MainStreet.com

Geithner: Saint or Sinner?

David Seaman — Fri, 20 Nov 2009 15:00:00 -0500

Did the bailout work? Or was it a monumental waste of taxpayer money? A little of both, maybe?

Some are calling for Treasury Secretary Tim Geithner’s head, but others think he should be given more time to help the economy to improve. As reported by CNN Money, a congressional panel hearing yesterday got heated, with “Republican Rep. Kevin Brady of Texas asking Geithner to consider resigning, citing the struggling economy, ‘frightening’ deficit and extensive job losses.”

But is the $700 billion financial bailout actually working? We sought answers from Main Street Americans, rather than policy wonks in Washington or on Wall Street. Here’s what they had to say.

“Bailout was not a good idea”

Michele Coy Toole, a Little Rock, Arkansas marketing consultant whose husband is general manager of an auto parts distribution company, is not happy with Geithner’s performance, and speaks about political issues on her Twitter feed. She sent the following comment to MainStreet in an email.

“I would have to say that the bailout was not a good idea for four reasons: 1) it increased the nation’s deficit 2) the whole idea of our country is about success and failure. You can't learn from your mistakes if someone ‘takes’ the consequences away 3) it missed with other industries, i.e. aftermarket auto parts. The cash for clunkers took 750,000 cars off the market, which directly impacts the aftermarket industry and lastly 4) It doesn't appear to have worked. Credit is still tight and the U.S. dollar has reduced in value reducing the buying power of average Americans as well as businesses… As for Mr. Geithner, I don't think he should have gotten the job in the first place. I think there are far more people with better qualifications than him (who actually pay their taxes correctly) that could have done a better job. Reviewing his job performance so far, I don't think he has done a very good job. People should be rewarded for performance and I don't see him performing very well at all so far.”

Ms. Toole makes some interesting points, particularly her line about removing the consequences of failure, which seems to many people to be the antithesis of a free-market system. Some of her points, however, are a bit more confusing to me. She seems to be mixing up the bailout and the Cash for Clunkers program, which had little to do with Geithner and was more the brainchild of the Democratic Congress and the administration.

“Secretary Geithner is doing a good job”

“I think Secretary Geithner is doing a good job, and I'm a pretty progressive guy. People say that President Obama should be cut some slack in terms of unemployment numbers, so why not Geithner? We all know that unemployment is a lagging indicator of the economy and because of the President's stimulus package, Americans will find good-paying jobs again. I don't think anyone really liked the bailout. We gave billions of dollars to a lot of people that caused the problem. With that being said, it had a positive effect on the American economy. It allowed small businesses and entrepreneurs to get the much-needed credit to rejuvenate our economy again,” said Michael Suleiman, a 19 year old college student at Rutgers University who is involved in southern New Jersey politics as a volunteer.

Mr. Suleiman's comparison of Secretary Geithner to President Obama seems fair, but his point about small business is a bit off the mark. The bailout has not led to the opening up of credit markets for small businesses or anyone else. Credit is still very tight, as Federal Reserve Chairman Ben Bernanke recently told the Economic Club of New York: "Access to credit remains strained for borrowers who are particularly dependent on banks, such as households and small businesses... Small businesses have seen their bank credit lines reduced or eliminated, or they have been able to obtain credit only on significantly more restrictive terms.”

What do you think of Geithner’s job performance? Tell us in the comments, or on our Facebook page.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Holiday Gimmicks to Lure Shoppers

The Associated Press — Fri, 20 Nov 2009 14:00:01 -0500

By Ashley M. Heher, AP Retail Writer

As you rush into the holiday shopping season, you may catch a whiff of cookies baking at the mall or find a note from a roving elf on your iPhone or get a coupon by text message.

Across the nation, retailers and mall owners are trying to spark the holiday spirit with longer hours, more live music, twittering elves and even fresh-baked cookies.

Simon Property Group, the nation's largest mall owner, plans to give away more than 2 million bite-size chocolate chip cookies this season in partnership with Nestle's Tollhouse brand.

Cathi Weiner, a senior vice president at Simon Brand Ventures, calls it retail aromatherapy.

"I can't think of anything that can fit into it more — warm cookies in the mall and that type of comfort food feel," she said.

Shoppers will be able to snag several morsels at a time, along with a Nestle coupon during the promotion, which starts Black Friday, Nov. 27, at 100 locations and runs each weekend through Christmas. But it's strictly BYOM: bring your own milk.

Taubman Centers, with 24 malls nationwide, plans to focus on store employees by delivering breakfast to thousands of workers the day after Thanksgiving, known as Black Friday and traditionally seen as the launch date for the holiday shopping season.

The mall management company also plans to treat store employees to midday massages.

"We wanted our retailers to be at their peak performance," said Taubman spokeswoman Karen MacDonald.

Shoppers also will get free breakfast at Taubman malls in Los Angeles, Miami, Dearborn, Mich., and Wellington, Fla., while others will offer free parking.

Copyright The Associated Press 2009.

5 Dumbest Things on Wall Street: Nov. 20

Gregg Greenberg — Fri, 20 Nov 2009 13:43:49 -0500

5. Costco Flattens Coke

NEW YORK (TheStreet) -- Sorry, Costco (Stock Quote: CSCO) customers. No Coke, Pepsi (Stock Quote: PEP)!

Costco confirmed Monday that it ceased carrying Coca-Cola Co. (Stock Quote: KO) products due to a pricing dispute with the beverage maker. The wholesale club operator, which operates about 560 warehouses in the U.S. and abroad, said on its Web site that it will not remove bottles of Coke and Diet Coke currently displayed on its store shelves, but does not plan to restock them "until the matter is resolved."

Coca-Cola Co. refused to comment on the squabble, other than calling Costco an important customer and saying it will work with them "in a spirit of fairness."

Essentially, the Coke/Costco rift is a function of the recession. Strapped shoppers are pushing retailers to lower prices, while product makers like Coca-Cola are straining to maintain margins. What gives this particular fight some additional fizz is that it is being waged by an upstart retailer against one of the world's most heavyweight brands. And judging from the signs on Costco's shelves and site, they don't believe they are fighting above their weight class.

"Costco is committed to carrying name brand merchandise at the best possible prices. At this time, Coca-Cola has not provided Costco with competitive pricing, so that we may pass along the value our members deserve," said a message on the company's Web site, labeled "Price Alert!"

We here at the Five Dumbest Lab just hope both sides settle this silly beverage battle as quickly and amicably as possible. So when times get better they can go back to their normal practice of overcharging consumers for syrup, sugar and seltzer.

Dumb-o-meter score: 75 -- Our favorite soda? Dr. Brown's Cel-Ray Tonic! Can't beat that celery flavor.

4. Genentech Speaks Washington's Language

The nation's hardworking public servants in Congress are really speaking Genentech's language.

We aren't kidding you. They literally are.

According to the New York Times, lobbyists working for the biotech company, now a part of Swiss drugmaker Roche Holding, penned statements for more than a dozen representatives during debate over the health care bill earlier this year. The statements ultimately ended up in the House's official record.

The Times estimates that 42 House members picked up some of Genentech's talking points, including 22 Republicans and 20 Democrats. So at least the company was bipartisan in its ghostwriting.

Or, more likely, they were just covering all their bases.

Either way, emails uncovered by the Times show that the Congressional statements were based on information sent from Genentech employees to the company's lobbyists. Those very same lobbyists, of course, are no strangers to lawmakers on Capitol Hill. Genentech's political action committee and Roche have made contributions to House members, including some that have filed statements in the Congressional Record. Evan Morris, head of Genentech's Washington office, told the Times there was no link between the contributions and the statements.

Yeah, right. And we have a monument to sell you in Washington.

"I regret that the language was the same. I did not know it was," Rep. Bill Pascrell Jr., (D., N.J.) told the Times, adding that he said he got his statement from his staff and "did not know where they got the information from."

Well, now you know, congressman. And so do we.

Dumb-o-meter score: 80 -- It may have been profane at times, but at least the yelling in the Town Halls this summer was authentic.

3. GM's Payback Jive

Thanks for nothing, GM (Stock Quote: MTLQQ.PK).

General Motors said Monday it lost $1.2 billion from the time it left bankruptcy protection through Sept. 30. While that may seem like less than celebratory news, it was a much improved figure from previous quarters. In fact, performance at General Motors was so much better than anticipated that the auto giant also proudly boasted it will begin repaying $6.7 billion in U.S. government loans starting with a $1.2 billion payment in December.

And wait, there's more! GM intends to repay the entire debt over the next eight quarters, but could pay the full amount back to Uncle Sam as early as next year, if things go smoothly.

"We have significantly more work to do, but today's results provide evidence of the solid foundation we are building for the new GM," CEO Fritz Henderson said in a statement.

Hooray! The taxpayer is finally getting money back from GM -- and maybe earlier than planned. Sounds like great news to us.

Not so fast, Fritz. There is a catch. The money being returned is coming from GM's rainy day fund set up by the government.

Come again?

You see, GM entered bankruptcy protection with roughly $94.7 billion in debt. It emerged with $17 billion, including the $6.7 billion owed to the U.S. government. The government has given GM a total of $52 billion, including $45.3 billion in exchange for a 61% equity stake in the company.

GM CFO Ray Young, who is now in the process of being replaced as GM's top money man, said the government placed $16.4 billion of GM's loan money into a contingency fund as a precaution against falling sales or some other problem.

So in other words, the government is getting back GM's rainy day money even though the automaker is still drowning in red ink.

Dumb-o-meter score: 85 - That's kind of like robbing Peter to pay Peter, isn't it?

2. The (Double) Cheeseburger Rebellion

Watch your neck, your highness. There's revolution in the air at Burger King (Stock Quote: BKC).

In a letter to Burger King's board dated Nov. 11, but released this week, a group representing hundreds of franchisees attacked management for its "ill-conceived" decisions that they say could endanger their businesses.

What sparked this uprising among the King's once-loyal minions? A $1 double cheeseburger promotion forced on them after they voted against it two times. While costs vary by location, the $1 double cheeseburger typically costs franchisees at least $1.10. Hence, franchisees sued management over the matter earlier this month in a case still unresolved.

The band of disenfranchised franchisees also criticized an earlier corporate decision to snatch back millions of dollars in rebates distributed to franchise owners from soft drink companies.

Why should Burger King's management take this threat seriously? Because franchise owners operate approximately 90% of the company's 12,000 locations so they have a lot of sway with the board and the big cheese himself, CEO John Chidsey. Moreover, the board is already hearing from restless shareholders over its company's dismal stock performance, down 11% over the last year, vs. McDonald's (Stock Quote: MCD), which is up 13%.

"We feel this is a very sad time for the Burger King brand," according to the letter from the National Franchisee Association.

Burger King spokeswoman Denise Wilson, on the other hand, said the company's actions and its $1 double cheeseburger offer are in the best interest of its franchisees.

"BKC takes great pride in our franchise system and the actions we have taken to enhance our competitive position," she said in a statement Tuesday evening.

Clearly these two sides have a long way to go before they meat -- we mean meet -- in the middle and save the kingdom from total collapse.

Dumb-o-meter score: 90 -- Where's the beef? Just ask the Burger King franchise association. They've got a big one!

1. Kellogg Waffles on Eggos

Imagine Kleenex announcing a shortage of tissues? Or Jell-O rationing pudding? Well, that nightmare has become a reality for Kellogg (Stock Quote: K).

Yep, they are running out of Eggos.

Kellogg said this week that the supply of its popular Eggo frozen waffles is dwindling as a result of production interruptions at two of its four Eggo plants. Kellogg's Atlanta plant was shut down in September after a series of storms caused extensive flooding in the area. Several production lines at the company's Rossville, Tenn. bakery are closed indefinitely for repairs, according to the company spokeswoman Kris Charles.

The remaining -- and functioning -- Eggo plants are located in San Jose, Calif., and Blue Anchor, N.J. Not until the middle of 2010 will grocery store shelves around the country be stocked at pre-shutdown levels, Charles said in an email to the Associated Press.

"We are working around the clock to restore Eggo store inventories to normal levels as quickly as possible," wrote Charles.

Seems to us like the company should have had a backup plan for one of its most famous and profitable products. Right now the company is running the risk that consumers will simply "Leggo" of their Eggos and switch to another brand of waffle upon visiting the freezer aisle.

Our solution is for Kellogg to hand over waffle production to its Keebler division. You know those elves won't miss a shipment.

Dumb-o-meter score: 95 -- Then again, elves are awfully busy this time of year.

New York to Payday Lenders: "Pay Up"

Brian O'Connell — Fri, 20 Nov 2009 13:00:00 -0500

Payday lenders have a bad reputation, and the news coming out of New York this week isn’t going to change that anytime soon. This after two payday lenders and a Delaware bank were forced to pay more than $5 million to 14,000 consumers who were victimized – usually through paying higher interest rates than legally allowed. How did New York hold these payday lenders accountable?

The story begins with three companies: Telecash, Cashnet and County Bank of Rehobeth Beach, Delaware. According to the New York State Attorney General’s office, all of the companies were charging onerous interest rates for payday loans. Some loans came with interest rates of 500% or more. Backed by County Bank, the two payday companies set up shop mainly in the New York boroughs of Brooklyn and the Bronx and preyed on low-income New Yorkers who needed short-term loans – usually between $100 and $500 – which the borrower has to repay within a short period of time, but at a high interest rate.

Payday loans are problematic for many borrowers, but especially for low-income consumers who are often forced to extend – the industry term is "rollover" – the repayment timetable by paying exorbitant interest. According to a U.S. Congressional panel in Washington that’s studying the payday loan issue, borrowers are charged about $15 for every $100 borrowed for a two-week period. The panel says that translates into an interest rate of 390% annually. The study also says that payday loan operators draw many “repeat” borrowers, with the typical customer borrowing funds seven times a year.

A separate study by Paige Marta Skiba, of the Vanderbilt University Law School, and Jeremy Tobacman, of the Wharton School at the University of Pennsylvania, says that an estimated 10 million American households borrow on payday loans each year.

Apparently, consumer advocates in New York had seen enough. According to the New York State Attorney General’s office, payday loan operators Telecash and Cashnet, through an agreement with County Bank, disguised their payday loans as being made by County Bank. But New York claimed that federal banking laws permit state or nationally chartered banks to make loans throughout the United States at the interest rates permitted under the bank’s home state – that’s no more than 16% in New York. But County Bank was based out of Delaware, which, unlike New York, has no cap on the amount of interest that can be charged on a loan.

In other words, Delaware allows high interest payday loans – but New York doesn’t.

Payday loan industry officials don’t see their loans as a problem, with a common refrain coming from the industry that payday loans were never meant to be long-term loans, the bulk of which generate those gargantuan interest rates. They also point out that many states have implemented stiff regulations on payday loan rollover provisions – including New York.

But what tripped up County was operating as a bank (with Cashnet and Telecash acting as “fronts”) in New York, but under Delaware-type rules. Thus, the state of New York levied fines and penalties. Under the terms of the case, anyone who borrowed cash from either payday loan operator will be repaid based on the amount of interest they paid on their loans. New York estimates repayments anywhere between $10 and $4,500).

If you think you’ve been had by Cashnet or Telecash, and reside in the state of New York, contact the Attorney General's Help Line at 1-800-771-7755.

Are There ANY Jobs for Recent Grads?

David Seaman — Fri, 20 Nov 2009 12:00:00 -0500

As CNN Money has reported, “hiring for graduates will remain near its lowest level in decades after [a] 40% plunge last year.”

Hiring of graduates will decline by 2% next year, according to a recruiting trends survey done by Michigan State University. Master’s degree grads will see 11% less openings next year, “based on a weaker labor market for accounting students.”

Jobs for Ph.D.s, however, is something of a bright spot in an otherwise gloomy environment: they are expected to see a 20% “spike” in jobs next year, and MBA graduates will similarly see an 11% increase in job opportunities.

There are two other positive predictions for next year. First off, sounds like small companies will be hiring more in 2010: “Employers with fewer than 500 staff members said they expect hiring at their companies to jump by 15%. These companies will hire 11 new graduates on average in 2010, and 8 of them will be at the bachelor's level.”

Secondly, if you are lucky enough to have majored in environmental science or statistics, “job opportunities will climb by 6% and 11%, respectively.”

Areas with job growth

According to the survey’s results, “job opportunities in the South Central will rise by 6%, in the Northwest by 4% and in the Southwest 2%.”

What about openings in other areas of the country? Their numbers “will still sag,” unfortunately.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Gov’t Abandons Bush Era Investment Rules

The Associated Press — Fri, 20 Nov 2009 11:11:16 -0500

By David Pitt, AP Personal Finance Writer

DES MOINES, Iowa (AP) — The federal government has decided to abandon a Bush administration plan that would have permitted mutual fund companies and brokerage firms to offer investment advice to 401(k) customers.

The rule would have allowed financial advisers, who work with mutual fund companies and brokerages to sell investment products, to provide investment advice to 401(k) and individual retirement account customers.

It was one of several signed by former President George W. Bush in the final days of his administration. President Barack Obama, as he took office, issued executive orders freezing all proposed federal rules changes left unfinished by Bush.

The Obama administration, after reviewing the rule, moved forward with implementation. But after taking public comment, the rule was delayed several times.

On Thursday, the Department of Labor released a statement saying the rule would be withdrawn, effectively killing it.

"The department decided to withdraw the rule based on public comments that raised sufficient doubts as to whether the conditions of the final rule...could adequately protect the interests of plan participants and beneficiaries," the statement said.

The rule was supposed to give retirement investors increased access to advice about how to invest wisely, but critics said there was no way to be sure advisers, who also helped sell products, would give impartial advice.

House Republican leader John Boehner said the advice policy, included in the Pension Protection Act of 2006, was passed with bipartisan support. Killing it is unacceptable, he said.

"It is outrageous that the Obama administration would deny workers their right to high-quality investment advice that could help them restore valuable savings that have been lost because of this economic recession," he said in a statement.

However, House Education and Labor Chairman George Miller said the administration was right to pull the idea.

"It would have opened the door to unscrupulous advisers to make recommendation based on their financial stake and not in the best interest of workers," the California Democrat said.

The Department of Labor said it would propose a new rule on investment advice, but gave no specific date for its release.

___

AP reporter Sam Hananel contributed to this story from Washington.

Black Friday Could See Less Plastic

Brian O'Connell — Fri, 20 Nov 2009 10:22:16 -0500

No doubt about it, consumers are out shopping on Black Friday, but they’re leaving their credit cards at home.

A new study says credit card usage during the holiday season will be down at least 10%. What are shoppers doing instead? And what does the trend away from plastic mean to the credit card industry? Let’s take a look.

Prudent shoppers these days are hardly a surprise. With unemployment over 10%, and with “underemployment” – people who have either quit looking or who are working as freelancers or part-time – at 15%, consumers are in survival mode. Gone are the days of using our homes as ATMs, or breezily running up a tab on our credit card bills.

Now it’s all about debt reduction and bank savings – even on the cusp of a big shopping holiday like Black Friday. According to a new study by BIG Research, for the National Retail Federation, consumer credit card usage this holiday season will be down 10%. The study reports that only 28.3% of shoppers expect to use a credit card to buy holiday gifts during the next few weeks – that’s down from 31.5% in 2008.

The alternative method of payments? This holiday season it’s cash. In a nice piece of symmetry, the number of BIG Research’s survey audience who expect to use cash (9.1%) is pretty much the same number, percentage-wise, who’ll be reducing their credit card usage. Debit cards will also see more of the light of day, as 42.5% of shoppers plan to pay primarily with debit or check cards, a 2.5% increase from 2008.

That’s bad news for credit card issuers who will no doubt see less revenue from what usually is the most profitable period of the year. Retailers will suffer, too, as consumers tamp down spending on pricey goods like computers and jewelry, in favor of more practical gifts. According to the BIG study, holiday shoppers will buy more clothing (58.4% vs. 57.4%) and more toys (42.2% vs. 41.6%) than last year.

That’s one big reason why consumers can expect to see more discounts on lower-priced items. The BIG Research study points out that we’ve already seen Black Friday promotions such as “50% off of outerwear, $25 designer apparel and $10 toys.”

Altogether, the National Retail Federation expects retails sales to fall in 2009, although not by as much as 2008, however. Total sales should decline by 1%, to $437 billion this year (compared to a decline of 3.4% in 2008.)

It’s make-or-break time for card carriers and retailers, but consumers aren’t cooperating. Normally, the holidays generate between 20%-40% of total annual revenue for retailers. Credit card companies profits are up anywhere from 17% to 22% during the holiday rush, according to CardTrack.com.

But with card usage down, both markets will see bigger declines than expected, putting yet another proverbial coal in the stocking of the U.S. economy.

Partial Roth Conversions: Right for You?

Jeff Brown — Fri, 20 Nov 2009 09:24:43 -0500

Investors facing the Roth-conversion decision tend to see it as an either/or proposition: keep everything in the traditional IRA, or convert everything into a Roth.

But there’s a third option: leaving some money in the traditional IRA while converting the rest.

The most obvious reason would be to prevent the conversion from kicking you into a higher tax bracket. Income tax must be paid on deductible contributions and investment gains, and these sums are added to your taxable income. If converting everything would boost you from a 15% to 25% tax bracket, it could make sense to limit the conversion so you can keep the lower tax rate.

Many people doing that plan a sequence of conversions over several years until everything is moved into the Roth.

But it may be worth thinking about leaving some of your funds in the traditional IRA for good, to hedge against the uncertainty over future tax rates.

Generally, a Roth conversion makes sense if you expect to be in a higher tax bracket in retirement, since you could pay tax at today’s lower rate to avoid a bigger tax later. But if you expect your tax rate to fall, you’d pay less by sticking with the traditional IRA and paying at the lower rate when you make withdrawals later.

The problem is that, even if you can predict the size of your taxable income in retirement, no one knows what the tax laws will be in five, 10, 20 or 30 years. In the worst case, Washington could change the rules to give you a higher tax rate even if your income goes down.

By keeping some funds in the traditional IRA and converting the rest, you could have a bit more control over your future tax situation. The result won’t be quite as good as if you guessed correctly about your future tax bracket, but it won’t be as bad as it would if you guessed wrong.

Upon turning 70 ½, you would have to start required minimum distributions from your traditional IRA, even if you did not need the money. But RMDs are not as terrible as many people think. A person with a life expectancy of 20 years would have to withdraw only 5% of the traditional IRA assets that year. Obviously, you’re not required to spend that withdrawal, only to pay taxes on it.

If you needed more than the required minimum to live on, you could consider taxes when deciding whether to draw from the traditional IRA or the Roth. Using the Roth would be better if your tax bracket were high, or if drawing on the traditional IRA would kick you into a higher bracket. Drawing from the traditional IRA would make sense when your bracket was low.

A savvy retiree would also factor in tax implications of withdrawing from ordinary taxable accounts. In some years, you may be able to sell money-losing investments to offset the taxes you’d otherwise owe on money taken from a traditional IRA.

Use the Roth IRA Conversion Calculator to figure whether a conversion makes sense. Also check the conversion advice offered by your stock broker and mutual fund company. Charles Schwab (Stock Quote: SCHW) and T. Rowe Price (Stock Quote: TROW) offer detailed discussions.

The Secret to Getting A Cheaper Laptop

Seth Fiegerman — Fri, 20 Nov 2009 09:00:00 -0500

Do you want to buy a laptop or netbook for 100 bucks? Well, the trick is to look to your cell phone company.

In the last year, phone companies have entered the world of laptops. Companies like AT&T, Verizon and Nokia have partnered with computer manufacturers like Dell and Acer to debut a modified computer called the 3G laptop. These computers are usually similar in size to netbooks and use the 3G wireless Internet connection available on many smart phones.

The computers typically cost a few hundred dollars, but when you buy them with a two-year contract from the phone providers, you can get some of these 3G laptops for less than $100.

RadioShack started to sell an Acer netbook from AT&T at the end of last year for $99, and Best Buy actually experimented with selling a Compaq Mini for just 99 cents back in June. Both of these deals required signing long term phone contracts.

How can the companies get away with selling computers for that cheap. Well, according to Bloomberg.com, “technical support, product warranties and phone contracts are more profitable than the laptops and handsets themselves.”

Unfortunately, companies are enforcing certain limits to these plans. While customers can often get a free phone with an extended contract, the same is not likely to happen with computers (despite Best Buy’s experiment).

“We want to give customers a choice in how they use their netbook,” the president of AT&T emerging devices told Wired.com recently. “But free netbooks from AT&T on contract is not part of the plan.”

On top of that, phone companies are very alert to ways users could scam them. A few months ago, reports came out that Ericsson had developed a special modem for its 3G laptops that had a built-in kill switch. The reason, as BoingBoing.net noted, was that “carriers are worried that customers might sign up for a contract, then stop paying their monthly service fee but continue to use the laptops.”

On the other hand, it's important for consumers to figure out whether the monthly plan you sign up for ends up costing so much that it nearly nullifies the savings on the computer. In some cases, the answer may be yes. But one strong positive of buying your computer through a phone company is that you will not only get wireless Internet, but you may also get free access to Wi-Fi hotspots around the country that usually cost money.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Holiday Charity: Gifts With Good Karma

Althea Chang — Fri, 20 Nov 2009 07:00:00 -0500

Charitable giving made easy, even in a less than cheery economy.

Incredible Winter Cruise Deals

Seth Fiegerman — Fri, 20 Nov 2009 07:00:00 -0500

We found 10 Cruise deals this winter that will knock your socks off.

Avoid Black Friday Debt

Althea Chang — Fri, 20 Nov 2009 07:00:00 -0500

Here are a few shopping strategies to prevent bills from taking a toll on your post-holiday budget.

Dirt Cheap Flights

Seth Fiegerman — Thu, 19 Nov 2009 17:28:01 -0500

UPDATE: This deal is no longer valid.

JetBlue is offering a set of super discounted flights to and from cities across the country, starting at just $29.

Fly from New York to Boston for just $39 or from New York to Aruba for $129. Flights from Los Angeles to New York are just $89. These prices do not include taxes, but even with that added on, the flights are dirt cheap.

JetBlue is calling the deals its Sample Sale. The airline has held similar sales in the past, but the timing of this one is particularly useful for holiday travelers.

The deals are available until 11:59pm tonight, and are only good on flights between December 2 – 16th and January 6 – 10th. It’s the perfect promotion for the holidays, giving cash strapped Americans a great way to see loved ones and friends who live far away.

However, there is one downside. If you’re reading this, you have no excuse not to see your loved ones and friends who live far away.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Foreclosures Hitting More People with Prime Loans

The Associated Press — Thu, 19 Nov 2009 16:00:45 -0500

By Alan Zibel, AP Real Estate Writer

WASHINGTON (AP) — A rising proportion of fixed-rate home loans made to people with good credit are sinking into foreclosure, adding to concerns about the strength of the economic recovery.

Driven by rising unemployment, such loans accounted for nearly 33 percent of new foreclosures last quarter. That compares with just 21 percent a year ago, when high-risk subprime loans made during the housing boom were the main reason for default.

At the same time, the proportion of homeowners with a mortgage who were either behind on their payments or in foreclosure hit a record-high for the ninth straight quarter.

The Mortgage Bankers Association's report Thursday suggests the housing market and broader recovery could be thwarted by the continuing surge in home loan defaults, especially as the unemployment rate keeps rising. Lost jobs, rather than the shady loans made during the housing boom, are now the main reason homeowners fall behind on their mortgages.

After three years of plunging prices, the housing market started to rebound this summer. While optimists hope the worst is over, pessimists say there are simply too many foreclosed properties that have yet to be dumped on the market and expect further price declines.

About 4 million homeowners were either in foreclosure or at least three months behind on their mortgage payments as of September, according to the mortgage bankers group. Even if a quarter of those borrowers are able to stay in their homes, "there's a lot of potential inventory coming into the market next year," said Jay Brinkmann, chief economist with the Mortgage Bankers Association.

Those foreclosures will push home prices downward, especially in the hardest-hit California and Florida cities, places that are also coping with soaring unemployment, he said.

The record-high foreclosure numbers are being driven by borrowers with traditional fixed-rate mortgages, rather than the high-risk subprime loans with adjustable rates that triggered the mortgage crisis.

Subprime loans with adjustable rates have fallen to 16 percent of new foreclosures from 35 percent a year earlier.

Loans backed by the Federal Housing Administration also show increasing signs of trouble. More than 18 percent of FHA borrowers are at least one payment behind or in foreclosure.

Among states, the worst of the trouble is still concentrated in California, Nevada, Arizona and Florida, which accounted for 44 percent of new foreclosures in the country. Nearly 13 percent of all loans in Florida were in foreclosure, the highest in the U.S., followed by Nevada at more than 9 percent.

Copyright 2009 The Associated Press.

Can You Sell Your Home Without a Realtor?

Brian O'Connell — Thu, 19 Nov 2009 15:52:20 -0500

Real estate agents can be a big help in selling your home, but they can also take a good chunk of your sale price, too. That begs the question – can you – and should you – sell your house on your own? The answer is yes, but you really need to have your ducks in a row.

Before you embrace the idea of selling your own house, know that the home sales landscape is a tough one right now. According to the National Association of Realtors, home prices slid in eight out of every 10 U.S cities in the third quarter of 2009. The median homes sales price was also 11% lower than in the third quarter of 2008.

That means selling a home at the price you believe your house is worth is, well, a tough sell. So having a seasoned realtor in your corner may know how to push the right buttons to get your home sold at the price range you want.

Of course, realtors are mainly in business to make a buck. So while it might not be in your best interest to sell your home at a lower price, it’s not in the real estate agent’s best interest to sell your home for less money either. That’s how they generate commissions, wich are approximately 5% or 6% of the sale price. So if you sell your home at $300,000, at minimum, you’re going to pay your realtor $15,000.

Consequently, if you take the solo route, at least your selling the home on your terms, and you’re likely saving thousands of dollars in the process.

To start selling your home, sans realtor, take these steps:

Figure out the value of your home. You’ll need to peg the approximate value of your home before you put it on the market. To do so, you can use Internet real estate sites like Zillow.com that “ballpark” the value of just about every home in the U.S., most likely yours included. You can also check the local real estate sales in your neighborhood, via the local newspaper, and see what houses on your block go for when they’re sold. If you have a good relationship with a local real estate agent, pay him or her a small fee - $150 or so should do the job – to appraise your home (called a comparative market analysis in the real estate industry). Most realtors have thorough home sales listings in your community and can fairly easily peg the value of your home. Be upfront, though, and let the realtor know you’re selling the home on your own.

Clean it. Once you have a good grip on the value of your home, scrub your home, inside and out, from top to bottom. Make a list of needed repairs and get them done. Hire a professional cleaning service – expect to pay up to $500 for a deep cleaning of your home, or do it yourself. Outside, make sure your property is clean and landscaped – your yard and your house are the first things a potential buyer sees when they pull in your driveway. Nothing will drive them away quicker than a shaggy lawn or a front door with peeling paint on it. Realtors call the cleaning process “staging”, i.e. allowing buyers to easily imagine themselves living in your home.

Put your house on the market. Go to the hardware store and get one of those “For Sale by Owner” signs and stick it on your lawn – securely. Then place an ad in your local paper and on key real estate web sites like Craigslist.com. Make flyers and put them on community bulletin boards. You can also use a buyer’s agent to get your house on multiple listing services that professional realtors use.

Host an “Open House.” Place an ad in your local paper, preferably on Sunday when more eyeballs will see your ad touting your open house. Schedule it for a Sunday afternoon, again, for maximum impact. Have a “takeaway” in the form of a brochure or glossy photo of your home, with relevant information (square footage, number of rooms, finished basement, etc.) Have some fresh flowers on hand to make your home even more natural and agreeable to potential buyers. Play some jazz or classical music to set a comfortable tone for your open house.

You’ll need to hire a lawyer – it could cost $1,000 or so – to handle the title, disclosures, home sales agreement, and other critical paperwork. Also, when you get an offer, check to see if your buyer has been pre-approved for a loan (ask the buyer for his or her mortgage lender, then get a letter from the lender stating the buyer is pre-approved).

Once you finally sell the home, you should realize thousands of dollars in savings. Use $30 of it to buy a good bottle of champagne. Pop the cork and celebrate – you’ve earned it.

Negotiate the Best Deal For A Trade-In Car

Brian O'Connell — Thu, 19 Nov 2009 14:27:19 -0500

Slick auto salespeople will tell you that there isn’t much they can do to change the trade-in price of your old car. They say there’s a formula involved that just cannot be tampered with. Not so. You can negotiate a higher price for your trade – but only if you follow these key tips.

How auto dealers value your car. Do what the auto dealers do and visit one of the companies they use to peg the value of your car. Do so online, at the National Automobile Dealers Association, or “NADA”, Black Book, and Kelley Blue Book. Review each site thoroughly and get a good idea of the value of your car.

Don’t confuse dealer vale and retail value. These two “values” are different. By and large dealer value is $2,500-$4,000 less than retail value (the price you could theoretically get in the open market for your car). Dealer value places an emphasis on the cost of reconditioning your vehicle, its resale potential (can the dealer sell the car quickly or will it be stored on the lot for months?), and any advertising costs attached to the sale of your car. The starting point for your negotiations will likely be the dealer price – not the retail price.

Check the calendar. If you’re selling an off-road, four-wheel vehicle, do so in January, when the weather is colder. If you’re trading in a convertible, do so at the first sign of spring, when people start spending more time outside.

Visit multiple dealerships. Yep, it’s a pain in the neck, but visiting several auto dealers will give you a good idea of the best trade-in deal. Make sure you let the sales manager know that the number one factor in buying a car from him is the value of your trade-in. See if he can beat the best price you’ve secured so far.

Hike your chances by using the “right” dealer. Your chances of getting a great trade-in deal are increased if you approach a dealer who actually sells the car you’re looking to trade-in. For example, if you’re trading in a Ford SUV, take it to a Ford dealer first.

“Stage” your car. Put your car in the best light possible by cleaning it inside and out. Some higher-end car washes offer thorough cleaning and detailing services for under $100. It’s well worth that price to get a gleaming car to bring to dealers.

In all honesty, the best price you can get for your car is through a private buyer. But if you don’t have the time or inclination, then bone up on the secrets of the trade-in market, and buff up your chances on getting a great deal for your car.

The Post-Clunker Rise in Car Prices

The Associated Press — Thu, 19 Nov 2009 14:00:17 -0500

By Ken Thomas, Associated Press Writer

The government's Cash for Clunkers program offered a lot of Americans great deals on new cars. Now, those falling prices have shifted into reverse.

Prices for new and used cars rose sharply in October, partially reflecting a whiplash from the government trade-in program that winnowed inventories at dealership lots. The price spike also has to do with car companies delivering more expensive 2010 models to the showroom.

The Labor Department reported Wednesday that consumer prices for new cars rose 1.6 percent, the largest monthly increase since May 1981. Used cars also saw a price hike of 3.4 percent in October — their largest increase since September 1980.

All of this came against the backdrop of a sluggish economy — consumer prices are lower than a year ago and the higher car prices accounted for 90 percent of the overall 0.3 percent consumer price gains last month.

Economists and analysts said the steeper prices reflected a combination of factors in the new and used car market. Here's a look at what happened and what to expect in the months ahead.

Q: Why did new car prices spike when everything else was flat?

A: Cash for Clunkers, the summertime government program that gave consumers up to $4,500 to trade in a clunker for a more fuel-efficient vehicle, helped many new car dealers reduce their inventories in July and August. And most car companies have cut production because of the tough economy so many consumers had less to choose from when they surveyed dealerships in October.

The tighter inventories came as the new 2010 model year vehicles arrived en masse and many dealerships and manufacturers were less inclined to offer incentives.

"The Cash for Clunkers program may have wiped out the '09 models that have been sitting there but the brand-new 2010 models come and they can command a higher price for those," said Dr. James Brock, an economist at Miami University in Oxford, Ohio.

Q: How was the used car market affected?

A: Clunkers reduced the inventory of used cars because the government required the traded-in cars and trucks to be scrapped.

"A lot of (the used cars) were taken off the road in the Cash for Clunkers program so a lot of those trade-ins were scrapped instead of being available," said David Wyss, chief economist for Standard and Poor's in New York. "On top of that you had a pretty healthy demand for used cars because people aren't buying new ones."

Tom Webb, chief economist at Manheim Consulting, which produces an index of the used car market, said the lower new car sales in 2009 have reduced the number of vehicles traded-in to dealerships, reducing inventories and allowing used car dealers to charge a higher price.

Car companies have also cut their sales to rental companies, leading to fewer trade-ins of used cars from fleets.

Q: What does this say about the overall economy?

A: Hard to tell. Analysts noted that auto sales stabilized in October and showed improvements compared with the dramatic decline during the fall of 2008. If projected for an entire year, October sales rose to 10.5 million units compared with 9.2 million in September, a positive development but well below the annual sales of 15 million cars and trucks or more in the late 1990s and early 2000s.

The Cash for Clunkers program, meanwhile, galvanized auto showrooms during the summer but has led to reduced inventories, making it difficult to gauge the market until carmakers replenish car lots in the coming months.

"It's distorted the data both for new and used cars," Wyss said.

Q: Should I wait for prices to cool down? Or should I buy now?

A: Jesse Toprak, vice president for industry trends and insight with Truecar, a Santa Monica, Calif., company that tracks car buying habits, said he expects car prices to remain high for the rest of the year because dwindling vehicle inventories will keep dealer incentives down. Sport utility vehicles and pickup trucks, which tend to be more expensive, also take up a larger share of the market in November and December as consumers in cold weather states plan for the snow, mud and ice of winter.

But Toprak said consumers can still find a deal, especially if they're willing to buy an '09. His company found that "Black Friday," the hot shopping day after Thanksgiving, was the best day of the year to buy a car. Most consumers are shopping for sweaters instead of cars, average car incentives tend to be higher than normal that day and many dealers facing end-of-the-month sales quotas are more willing to bargain.

"It creates a perfect storm for car buying that day," Toprak said.

Copyright 2009 The Associated Press.

Senate, House Democratic Health Bills Compared

The Associated Press — Thu, 19 Nov 2009 12:00:52 -0500

By Erica Werner & Ricardo Alonso-Zaldivar, Associated Press Writers 

A comparison of the health care bills before Congress:
___

The Senate Democratic bill (Patient Protection and Affordable Care Act):

WHO'S COVERED: About 94 percent of legal residents under age 65 — compared with 83 percent now. Government subsidies to help buy coverage start in 2014. Illegal immigrants would not receive assistance.

COST: Coverage provisions cost $849 billion over 10 years.

HOW IT'S PAID FOR: Fees on insurance companies, drugmakers, medical device manufacturers. Medicare payroll tax increased to 1.95 percent on income over $200,000 a year for individuals; $250,000 for couples. New 5 percent tax on elective cosmetic surgery. Cuts to Medicare and Medicaid. Excise tax on insurance companies, keyed to premiums paid on health care plans costing more than $8,500 annually for individuals and $23,000 for families. Fees on employers whose workers receive government subsidies to help them pay premiums. Fines on people who fail to purchase coverage.

REQUIREMENTS FOR INDIVIDUALS: Almost everyone must get coverage through an employer, on their own or through a government plan. Exemptions for economic hardship. Those who are obligated to buy coverage and refuse to do so would pay a fine starting at $95 in 2014 and rising to $750

REQUIREMENTS FOR EMPLOYERS: Not required to offer coverage, but medium and large companies would pay a fee if the government ends up subsidizing employees' coverage.

SUBSIDIES: Tax credits for individuals and families likely making up to 400 percent of the federal poverty level, which computes to $88,200 for a family of four. Tax credits for small employers.

BENEFITS PACKAGE: All plans sold to individuals and small businesses would have to cover basic benefits. The government would set four levels of coverage: The least generous would pay an estimated 60 percent of health care costs per year; the most generous would cover an estimated 90 percent.

INSURANCE INDUSTRY RESTRICTIONS: Starting in 2014: no denial of coverage based on pre-existing conditions. No higher premiums allowed for pre-existing conditions or gender. Limits on higher premiums based on age and family size. Starting upon enactment of legislation: children up to age 26 can stay on parents insurance; no lifetime limits on coverage.

GOVERNMENT-RUN PLAN: A new federal insurance plan would be offered to compete against private carriers. The government would negotiate — not dictate — payment rates for medical providers. Unlike the House bill, states could opt out of the plan. It's not clear the proposal commands enough votes to survive, and it could be replaced by a standby system pushed by moderates that would not go into effect until it was clear individual states were experiencing a lack of competition among private companies.

HOW YOU CHOOSE YOUR HEALTH INSURANCE: Self-employed people, uninsured individuals and small businesses could pick a plan offered through new state-based purchasing pools. Employees would be generally encouraged to keep their work-provided coverage.

DRUGS: Grants 12 years of market protection to high-tech drugs used to combat cancer, Parkinson's and other deadly diseases. Drug companies contribute $80 billion over 10 years with the majority of the money used to limit the prescription coverage gap in Medicare.

CHANGES TO MEDICAID: Income eligibility levels likely to be standardized to 133 percent of poverty, which is $29,327 a year for a family of four, for all parents, children and pregnant women. Federal government would pick up the full cost of the expansion during the first three years. States could negotiate with insurers to arrange coverage for people with incomes slightly higher than the cutoff for Medicaid.

LONG-TERM CARE: New voluntary long-term care insurance program would provide a basic benefit designed to help seniors and disabled people avoid going into nursing homes.

ANTITRUST: Amendment expected to be offered on the Senate floor to strip the health insurance industry of its antitrust exemption.

____

The House bill (Affordable Health Care for America Act):

WHO'S COVERED: About 96 percent of legal residents under age 65 — compared with 83 percent now. Government subsidies to help buy coverage start in 2013. About one-third of the remaining 18 million people under age 65 left uninsured would be illegal immigrants.

COST: The Congressional Budget Office says the bill's cost of expanding insurance coverage over 10 years is $1.055 trillion. The net cost is $894 billion, factoring in penalties on individuals and employers who don't comply with new requirements. That's under President Barack Obama's $900 billion goal. However, those figures leave out a variety of new costs in the bill, including increased prescription drug coverage for seniors under Medicare, so the measure may be around $1.2 trillion.

HOW IT'S PAID FOR: $460 billion over the next decade from new income taxes on single people making more than $500,000 a year and couples making more than $1 million. The original House bill taxed individuals making $280,000 a year and couples making more than $350,000, but the threshold was increased in response to lawmakers' concerns that the taxes would hit too many people and small businesses.

There are also more than $400 billion in cuts to Medicare and Medicaid; a new $20 billion fee on medical device makers; $13 billion from limiting contributions to flexible spending accounts; sizable penalties paid by individuals and employers who don't obtain coverage; and a mix of other corporate taxes and fees.

REQUIREMENTS FOR INDIVIDUALS: Individuals must have insurance, enforced through a tax penalty of 2.5 percent of income. People can apply for hardship waivers if coverage is unaffordable.

REQUIREMENTS FOR EMPLOYERS: Employers must provide insurance to their employees or pay a penalty of 8 percent of payroll. Companies with payrolls under $500,000 annually are exempt — a change from the original $250,000 level to accommodate concerns of moderate Democrats — and the penalty is phased in for companies with payrolls between $500,000 and $750,000.

Small businesses — those with 10 or fewer workers — get tax credits to help them provide coverage.

SUBSIDIES: Individuals and families with annual income up to 400 percent of poverty level, or $88,000 for a family of four, would get sliding-scale subsidies to help them buy coverage. The subsidies would begin in 2013.

HOW YOU CHOOSE YOUR HEALTH INSURANCE: Beginning in 2013 through a new Health Insurance Exchange open to individuals and, initially, small employers. It could be expanded to large employers over time. States could opt to operate their own exchanges in place of the national exchange if they follow federal rules.

BENEFITS PACKAGE: A committee would recommend a so-called essential benefits package including preventive services. Out-of pocket costs would be capped. The new benefit package would be the basic benefit package offered in the exchange.

INSURANCE INDUSTRY RESTRICTIONS: Starting in 2013, no denial of coverage based on pre-existing conditions. No higher premiums allowed for pre-existing conditions or gender. Limits on higher premiums based on age.

GOVERNMENT-RUN PLAN: A new public plan available through the insurance exchanges would be set up and run by the secretary of Health and Human Services. Democrats originally designed the plan to pay Medicare rates plus 5 percent to doctors. But the final version — preferred by moderate lawmakers — would let the HHS secretary negotiate rates with providers.

CHANGES TO MEDICAID: The federal-state insurance program for the poor would be expanded to cover all individuals under age 65 with incomes up to 150 percent of the federal poverty level, which is $33,075 per year for a family of four. The federal government would pick up the full cost of the expansion in 2013 and 2014; thereafter the federal government would pay 91 percent and states would pay 9 percent.

DRUGS: Grants 12 years of market protection to high-tech drugs used to combat cancer, Parkinson's and other deadly diseases. Phases out the gap in Medicare prescription drug coverage by 2019. Requires the HHS secretary to negotiate drug prices on behalf of Medicare beneficiaries.

LONG-TERM CARE: New voluntary long-term care insurance program would provide a basic benefit designed to help seniors and disabled people avoid going into nursing homes.

ANTITRUST: Would strip the health insurance industry of a long-standing exemption from antitrust laws covering market allocation, price-fixing and bid rigging. The bill also would give the Federal Trade Commission authority to look into the health insurance industry at its own initiative.

Copyright 2009 The Associated Press.

Deborah Norville Wants Your Respect

David Seaman — Thu, 19 Nov 2009 11:42:22 -0500

Deborah Norville, TV journalist and currently anchor of Inside Edition, is hitting the pavement to remind Americans that respect—yes, that’s right—is not an obsolete concept. Instead, it’s a crucial component of any successful career or rewarding relationship.

“None of us can predict” the hand that will be dealt to us career-wise, Norville told us this morning, which is precisely why “recognizing the efforts of others” and being known as a “nice person” can be a solid insurance policy—or even an overarching life philosophy.

She told us that employees who felt respected come up with 50% more creative ideas and that students at one school where respect was implemented got 35% higher math scores. Disrespect is the number one factor in divorces, she added.

The economic downturn has made it all the more necessary to respect others, according to Norville, since employers have “to get more out of remaining workers.” Respect is an easy and free way to boost morale.

If you’re applying for a job, we imagine that respect may be useful as well: it sends an instant message of professionalism, and makes you non-threatening to the recruiter or interviewer.

There’s a blurb on the back of her new book, The Power of Respect, that sums it all up. “I recommend this book to anyone who wants to do anything with anyone else,” Richard Parsons, Chairman of Citigroup, wrote.

So if you are someone who wants to do something with someone, at some point in your life, maybe respect is worth learning more about. My own introduction to the idea of respect came at a young age, watching The Godfather trilogy: “But you don’t ask with respect. You don’t offer friendship. You don’t even think to call me ‘Godfather.’” It seems obvious that if you want something, respect may boost your chances of getting it.

How Unhealthy Is Your State?

Seth Fiegerman — Thu, 19 Nov 2009 11:00:00 -0500

If you live in Mississippi, you may want to think about moving, or at least going on some long jogs.

A recent study put out by the United Health Foundation ranked all 50 states in terms of healthiness, and found Mississippi to be the unhealthiest state in the nation, followed by Oklahoma. Vermont, on the other hand, was the healthiest state.

One particularly interesting result in the study is that eight of the ten least healthy states were in the south, while all six states in New England were ranked in the top 10.

So how did the process work?

The annual study takes in to account a wide range of health factors, including smoking rates, obesity, air pollution and the percentage of children who get vaccinated. The report found that people who live in the south are more likely to be obese or to be smokers.

This is the ninth consecutive year that Mississippi came in dead last. According to USA Today, “Mississippi is singled out for high rates of obesity, infant mortality and death from cardiovascular disease.” Vermont, on the other hand, has been on top now for three years, thanks to better than average smoking rates and obesity.

Still, even some of the unhealthiest states found cause for celebration from the results.

Tennessee has been ranked in the bottom 5 since 2003, but this year, the state managed to climb out of the hole, snagging the coveted sixth worst state in the nation spot.

"We still have work to do," the state’s Health Commissioner said, according to Tennessean.com. "But if you look at where we are in the short period of time, we have taken focused approaches and worked with partners from one end of the state to the other and have made some good investments."

Tennessee may not be the most fit state, but they certainly have a healthy dose of optimism. And optimism is something that states like Nevada could use right now. The state was one of the only two states in bottom ten not from the south, not to mention the fact that it ranked second to last on our Happiness Index. Nevada has had a tough year.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Recall Watch: Gas Grills and Pacifiers

Althea Chang — Thu, 19 Nov 2009 10:12:30 -0500

Design flaws in gas grills and pacifiers could lead to serious injuries, prompting widespread recalls, according to the Consumer Product Safety Commission.

About 663,000 Perfect Flame SLG Series Gas Grills are being recalled following 40 reports of fires after burners deteriorated and 23 reports of lids catching fire, causing 21 cases of burns to users’ hands, arms or face. In one case, a consumer sustained an eye injury that required surgery.

The grills were sold exclusively at Lowe’s (Stock Quote: LOW) stores nationwide between September 2005 and May 2009 for between $200 and $550. For more information, visit CPSC.gov.

Separately, about 641,000 pacifiers are being recalled because their mouth guards are too small and could cause babies to choke on them, the CPSC reports.

The Bobby Chupete pacifiers came in aqua, red, white or yellow colors and the picture of an infant is on the original packaging. There were sold at various retail stores nationwide between November 2004 and July 2009 for about $1. For more information, visit CPSC.gov.

10 Reasons to Bet on America

David Seaman — Thu, 19 Nov 2009 07:00:00 -0500

Warren Buffett and Bill Gates are still excited about America’s economic future. Here’s why.

Manage Your Money Like A Diet!

David Seaman — Thu, 19 Nov 2009 07:00:00 -0500

New York Times best-selling author Ramit Sethi gives MainStreet the straight talk on personal finances. And it turns out sound saving strategies are a lot like a great diet.

Big HDTVs Under $600

Seth Fiegerman — Thu, 19 Nov 2009 07:00:00 -0500

These 10 HDTV’s are all at least 32 inches wide and all are great bargains. Go Wild.

Bank of Mom and Dad: Wasteful Wheels

Farnoosh Torabi — Wed, 18 Nov 2009 22:00:00 -0500

Each week on SOAPnet’s new original reality series Bank of Mom and Dad, a twenty-something woman who is drowning in debt must pay the ultimate price ... letting her parents move in! With the assistance of money coach Farnoosh Torabi (that's me), Mom and Dad will teach their daughter to rethink her spending habits and transform her relationship with money.

This week former NFL cheerleader Julie Tempest and her $35,000 debt load take the spotlight. Her car loan, by itself, is more than $20,000 and her credit card balances amount to more than $10,000. The 27-year-old part-time dental assistant from Jersey City, N.J., is so broke that she’s been leaning on her mom Denise and brother Chad to make basic ends — from rent to food — to meet.

Mom’s been dipping into her pension to pay Julie’s monthly bills and Chad has agreed to let Julie sleep on his couch, since she can’t afford her own place. But enough is enough. Her family is unable to keep up with their financial support. Meantime Julie shows no signs of slowing down her free-fall spending and addressing her debt. I spent the week with the Bank of Mom and Chad coaching Julie with the following advice:

Make More Money. Julie’s not working enough and her income shows it. Her part-time dental assistant position brings in an average $1,380 a month. To keep up with her bills, pay her monthly minimums on her credit cards and start saving for her own place, Julie will need to bring in at least an extra $300 a month — at least! To inspire her to make more money, Mom and Chad arranged to have Julie teach a couple of classes at a local cheerleading school for kids. The managers at the school thought Julie did a nice job and said they would consider hiring her for some shifts. The takeaway: When you need extra money consider a part-time job that lets you turn an existing skill into a revenue stream.

Sell Your Car. This is a recurring issue on Bank of Mom & Dad as some young women have car payments exceeding half their take-home pay. In Julie’s case, her fancy sport car is not really affordable unless she begins earning an extra $800 a month. This was the hardest reality for Julie to face, since she has a deep attachment to her car. When she’s in her car, she feels richer than she is. It’s an abusive relationship, I explained to her. The car is preventing her from addressing bigger financial problems and to get on with her life.

Don’t Wait for Prince Charming. Julie has admitted to being financially dependent on ex-boyfriends and that part of her hopes that her money woes will go away once she marries a rich man. She has seen many of her cheerleading friends leave the NFL and settle down with wealthy husbands and Julie sometimes hopes for the same, mainly so that she can be financially free. But what she doesn’t realize is that she is the only one who can save herself and that being in debt is not attractive. With the help of a dating and matchmaking expert, Mom and Chad were able to drive the point home and make Julie think long and hard about her dependency issues.

Catch a new episode of Bank of Mom and Dad Wednesdays at 10 p.m. (9 p.m. Central) on SOAPnet.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Senators Blast Internet Tricksters

The Associated Press — Wed, 18 Nov 2009 16:00:00 -0500

By Lolita C. Baldor, Associated Press Writer

WASHINGTON (AP) — With Cyber Monday, the unofficial start of the Internet holiday shopping season nearing, a Senate committee Tuesday condemned three online companies, saying they are tricking consumers into signing up for subscription services they don't want.

Internet companies Affinion, Vertrue and Webloyalty are using aggressive sales tactics to scam millions of customers, the Senate Commerce Committee said.

According to a committee report, the three companies enter into agreements with other more familiar Internet shopping sites that sell movie tickets, flowers and other items.

Just before a customer completes the sales confirmation process the customer gets an offer that often promises $10 cash back or other rewards, and appears to be connected to the shopper's original transaction.

When the shopper clicks "continue," or "yes," the shopper — often without knowing — enters into a new financial contract with a membership club operated by Affinion, Vertrue or Webloyalty, the report said. The shopper's credit card information is sent to the membership club company, which charges monthly fees, by the shopping site the shopper originally visited.

"Beware if you're a consumer," said the committee's chairman, Sen. Jay Rockefeller, D-W.Va. "I worry about this because the holiday shopping season is just beginning." He added that while the companies insist they are not breaking any laws, "just because what you say you do is legal doesn't make it right."

While the day after Thanksgiving is known as Black Friday, historically the point when retailers start to turn a profit, the following Monday has become known as Cyber Monday because it's the day when many shoppers begin trolling the Internet for bargains from computers at work or home.

The three Internet companies said in statements that they have put additional safeguards into effect, including clearer disclosure statements and new requirements that customers must enter the last four digits of their credit card number to formalize the subscription purchase.

"We only want members in our programs who want to be members so they can take advantage of the opportunity to save hundreds of dollars a year, and even a few complaints is too many," Webloyalty said in an e-mail statement.

Consumers, however, had their own stories to tell.

Linda Lindquist of Sussex, Wis., told the committee that she went online to buy movie tickets and clicked on a coupon that said "Get $10 off your next purchase." She said she thought it was a legitimate offer from the movietickets.com Web site she had just bought the movie passes from.

A few months later, she said, she realized she had been billed more than $300 for "Reservation Rewards" and "Shoppers Discounts" — two subscription services she didn't knowingly sign up for. She complained, and was later told by movietickets.com that she would get a full refund.

"I am a college educated person who is online every day," she told the committee. "I have seen many scams and offers on the Internet and have only been lured in by one, this one, due to the fact that the scam was associated with a reputable Web site and required just one click."

The committee began its investigation in May into the use of aggressive sales tactics on the Internet, and in its report said more than 450 e-commerce companies have partnered with the three firms in the past 10 years.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

The End of the Post Office?

Seth Fiegerman — Wed, 18 Nov 2009 15:15:00 -0500

United States Post Offices are even sadder places to work now than they usually are.

From the way people talk about the post office these days, you’d think the place was on the verge of shutting down.

The post office recently reported a $3.8 billion loss in the 2009 fiscal year. This comes after the postal service cut operating costs by $6 billion and cut tens of thousands of jobs. To make matters worse, this is the third year in a row that it has lost billions of dollars.

As CNN Money reports, the postal service industry is now formally considering eliminating Saturday service as a way to cut costs further. By some estimates, this could save as much as $3.5 billion a year. Yet, this idea has been tossed around for months, with some arguing that it would be better to skip Tuesday, rather than Saturday. At this point, maybe we should just rely on carrier pigeons for half the week instead.

However, the postal service is considering another basic change to help make up for the budget shortfall.

At a recent government panel discussion (aptly titled, More Than Stamps: Adapting the Postal Service to a Changing World), congressional representatives refused to discuss the option of cutting service. Instead, they are hoping to innovate in other ways.

According to the Washington Post, postal service officials are looking for congressional permission “to sell items such as pens, markers and presentation folders, along with banking, insurance and telecommunications products.” The Post also points out that some branches do already sell greeting cards.

Now that’s innovative thinking. Because there’s nowhere else you can go to pick up envelopes, pens and folders. That is, assuming the government forces Staples to close.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

New Sears Card Offers Credit Score Access

Brian O'Connell — Wed, 18 Nov 2009 13:45:16 -0500

On any list of high-end retailers, you likely won’t find Sears (Stock Quote: SHLD).

The retail giant has long been a value play for shoppers more than it has been a high-fashion, glamour stop at the mall, like a Nordstrom’s (Stock Quote: JWN) or a Neiman Marcus (Stock Quote: NMG).

So maybe Sears has to try harder, as it’s doing with its new store rewards credit card that offers you free access to your credit score on a 24/7 basis. The card comes with a new “credit score simulator tool” to educate consumers on how credit scores are calculated and how they can take steps to raise their credit scores.

The new Sears MasterCard (Stock Quote: MA) also provides discounts to cardholders, along with a deferred interest option.

A visit to the Sears Web site, along with a follow-up call to a customer service representative, lays out the credit card details.

With the card, you get access to a Transunion Transrisk credit score that is updated monthly, accessible online, and with no cost to the cardholder. According to the Web site, you have to log in to SearsCreditScore.com to find your score information. Cardholders can also sign up for monthly e-mail notifications. A bonus: Usually when you (or anyone else) checks your credit score, your score gets dinged a few points. But with the Sears MasterCard, all updates won’t count as an inquiry that might lower your credit score.

The credit card’s simulator tool enables cardholders to get a grip on their credit scores, with a user-friendly “A-F” letter grade set-up that ranks different metrics used to calculate your credit score. The feature also includes easy-to-use charts (that’s Sears description, anyway) that explains the relationship between credit grades and credit scores. “Improving one or more of your credit grades is an easy way to protect your credit and financial health,” the site says.

The Sears credit score simulator also has built a feature that explains how cardholders can raise their credit score by improving on 14 everyday financial behaviors.

The Sear MasterCard has a multi-tiered interest rate system that weighs changes to the prime rate, shopping behavior and cash access usage.

Sears says the APRs may vary each billing period based on changes to the prime rate.

It breaks down like this:

The purchase APR equals the Prime Rate plus 17.15%.
The cash access APR equals the Prime Rate plus 18.15%.
The default APR equals the Prime Rate plus up to 22.15%.

Sears says it reserves the right to raise your rate via a default APR based on the “seriousness of your default with us and your credit history.”

At least, you have to give Sears points for creativity. Check the card out for yourself here.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Husband vs. Wife: Insuring Against Disaster

Marek and Lori Fuchs — Wed, 18 Nov 2009 13:00:33 -0500

Lori and Marek Fuchs have never fought in their 16 years of marriage — except over money. In this column, Mr. and Mrs. Fuchs, a real-life married couple with three kids (ages 12, 8 and 5), articulate their very different approaches to personal finance.

This week, the Fuchs talk about the recent theft of their car from the driveway and the lesson we can all learn about home and car insurance.

Mr. Fuchs: Quite a surprise the other morning, huh?

Mrs. Fuchs: When the kids slept past 7 a.m.? I was shocked too.

Mr. Fuchs: That’s not it — you’re repressing that your beloved car was stolen from our driveway.

Mrs. Fuchs: Oh, you had to bring it up. I’m still in the denial stage of mourning. I loved that Acura.

Mr. Fuchs: Well, lucky for us, we had theft insurance. Auto theft insurance is pretty straightforward. Most have it for cars unless they are real junkers. But it got me thinking about replacement insurance for homes, which people are not as vigilant about.

Mrs. Fuchs: You mean you aren’t as vigilant about?

Mr. Fuchs: Believe it or not, I am. Don’t forget: When I am not writing columns, I serve as a firefighter. I know these things happen. If our house burns down, we’d have about $750,000 to replace it. I’ll get that sauna I always wanted. But according to a 2006 study by MSB, a construction data firm based in Wisconsin, more than half of homeowners don’t have sufficient replacement coverage. Some of these homeowners had enough originally, but then they are in the house for 20 years, and forget to increase the amount of coverage. Construction costs have increased over time, in a big way.

Mrs. Fuchs: Does that mean when their house burns down, they assume they are covered but the replacement value assumes construction costs from 20 years ago?

Mr. Fuchs: Exactly. It’s quite a fix. Krissy Posey, a spokeswoman for Allstate (Stock Quote: ALL), said that even today, more people are giving into the temptation to cut coverage, assuming that lower housing prices means lower construction costs, which is doesn’t.

She points to a study by Xactware, that had the cost of rebuilding a damaged home up 3.95% last year, despite the decline in home prices. Posey works for an insurance company, so you’d expect her to say it, but it’s a valid point: “When trying to cut costs on insurance, consumers should be weary of making a penny-wise, pound-foolish decision that could put them at risk financially.”

Mrs. Fuchs: It is expensive to rebuild a house. Especially if they want the Carrera marble in the master bath.

Mr. Fuchs: Not me — I’d slip on that stuff while getting out of my sauna. Anyhow, until just more than a decade ago, replacement was standard in homeowner policies, with at least 50% for contents. But now you should check your policy — probably once a year. Make sure you can rebuild and refill your house (remember: you don’t have to rebuy your land) for what you are allotted. If circumstances change — like an addition or the purchase of that Picasso you always wanted, factor it in.

Mrs. Fuchs: You could even use that as an occasion to shop around for policies. I’ll go out on a limb and say you should probably check all of your insurance policies every year or so to make sure they are still relevant and adequate.

Mr. Fuchs: Good to see that your car getting stolen has not diminished your judgment. One more thing: If readers have an old house like we do, they should really factor in the cost of rebuilding a house that is up to modern building codes. That might run you more than you think.

Mrs. Fuchs: I don’t even want to see what is inside our walls.

Mr. Fuchs: Probably nothing. But I hope we never have to find out.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

The Benefits of Choosing Your Successor

Joe Mont — Wed, 18 Nov 2009 12:15:50 -0500

BOSTON (TheStreet) — Warren Buffett, secretly, has one for Berkshire Hathaway (Stock Quote: BRK.A). Rupert Murdoch made news when he tipped his hat with initial details of News Corp.'s (Stock Quote: NWS). Robert Benmosche nearly triggered one for AIG (Stock Quote: AIG) when he huffed and puffed about government oversight.

The "it" in question is a business-succession plan, something a surprising number of companies, particularly small businesses, lack.

A recent survey by MassMutual found that 62% of the businesses it questioned don't have a legally documented succession plan. That means that in the event of death, disability or divorce, the loss of leadership and resulting uncertainties could bring about hardship and controversy as heirs carve out a niche for themselves.

The low percentage of succession plans presents an opportunity for insurance companies like John Hancock and MetLife (Stock Quote: MET) as they market whole-life policies that can assist with the passing of the torch.

"At the end of the day, it's about where you want your business to go," says Beth Wood, assistant vice president of business owner advocacy at MassMutual. "So many business owners, especially small-business owners, worry about the day-to-day but forget about the long term and thinking about where they want their business to go in terms of ownership."

Wood relates a story told to her by a business acquaintance about how things can go wrong. In this instance, a man lost his wife to a car accident.

"After three weeks of grieving, he decided he needed to pick himself up," she says. "He walked into his wife's business, where her former partner was, sat down at a staff meeting and said, 'OK, I'm ready to work.' Because there was no buy-sell agreement, he inherited 50% of the company. His wife's former partner was shocked and, even though she didn't really care for the gentleman, found herself in the position of having a new de facto partner."

Even businesses that have a plan in place through a buy-sell agreement may be in for trouble if there isn't enough money for a buyout. As a result, a whole-life policy can do double duty in such a situation. The death benefit can be used to purchase the deceased partner's shares from an estate, funding the buy-sell agreement. It can also provide a guaranteed cash value.

Tim FitzGerald, president of TFG Financial in Shreveport, La., a New York Life Insurance agent who works in succession planning, said some companies try to fund buy-sell agreements with a combination of term insurance or mutual funds. That can cause problems when a business partner decides move on if the stock market tanks or investment gains cause a large tax liability.

Still, marketing whole-life policies to businesses in need of a succession plan has proven to be a challenge.

"When people ask me what I do, I say I work with closely held, dysfunctional family businesses," FitzGerald says. "There is always dysfunction going on in a family business. I will always have a job because I'm the guy who gets in there and mediates. A lot of what I do is counseling and holding hands and having one brother arguing with, and screaming at, the other brother. It is all about negotiating these buy-sell agreements."

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Who's Hiring Telecommuters: GE Money, Accolade Support and Software Engineering of America

Bobbi Dempsey — Wed, 18 Nov 2009 11:30:44 -0500

Looking for a job that lets you work from home? Here are three companies with telecommuting opportunities available right now.

GE Money

What they do: A division of GE (Stock Quote: GE) that handles financing, loans and lines of credit.

Types of positions available: Client service representatives.

Hours/Pay: Positions are part-time, involving 19.5 hours per week or less. Pay is "competitive," and includes pension plan and rewards bonuses.

Requirements: High school diploma or GED, plus customer service experience. Must live within 65 miles of a GE Money call center (in Tempe, Ariz.; Charlotte, N.C; or Merriam, Kan.) in order to attend training sessions.

Other info: Must have high-speed Internet connection and landline phone.

Apply here.

Next Page: Accolade Support

Accolade Support

What they do: Cell center services for businesses.

Types of positions available: Technical support agents.

Hours/Pay: Hours vary, with full-time and part-time openings available. Pay is $10 to $12 an hour.

Requirements: Must have quiet home office with landline phone. Must have PC with a wired Internet connection.

Other info: Must have good customer service, sales and communication skills.

Apply here.

Next Page: Software Engineering of America

Software Engineering of America

What they do: Provider of data center software solutions.

Types of positions available: Software sales managers.

Hours/Pay: Work is generally performed during normal business hours. Pay involves base salary plus commissions.

Requirements: Three years experience in enterprise software sales, ability to drive the "full sales cycle" from beginning to end and ability to sell a diverse range of products.

Other info: Previous experience selling to System Z/Mainframe customers a plus.

Apply here.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Banking Deals of the Week: Nov. 18

Brian O'Connell — Wed, 18 Nov 2009 10:30:00 -0500

There’s a sense of growing discontent among the U.S. public, with many wondering if current economic trends (especially regarding jobs) have become current economic culture.

In other words, are things going to stay this bad for a long time?

Even President Obama seems worried. Yesterday he told Fox News (yes, he’s talking to Fox again) that current U.S. debt loads are unsustainable. If our debt load grows too large, we run the risk of dipping back into a recession, the President said.

“It is important though to recognize if we keep on adding to the debt, even in the midst of this recovery, that at some point, people could lose confidence in the U.S. economy in a way that could actually lead to a double-dip recession," he said.

OK, fine. But talking about debt without mentioning the fact that the federal government has dug a $1.2 trillion financial hole this year is like talking about great gorilla movies without mentioning King Kong.

So, no wonder consumers are losing confidence. The double-talk coming out of Washington just isn’t resonating with the public – and with good reason. Americans are antsy about the economy and Washington seems to be adding to, instead of fixing, the problem.

That’s the environment we’re dealing with right now, and it has bled over to the bank interest rate environment. By and large, rates are low, with few signs of creeping back up this year.

But it’s our job to find some pearls in the murky depths. And this edition of “Deals of the Week” promises not to disappoint.

Checking Account

Let’s start with a good checking account deal for residents of Alabama, Arizona, Colorado, Florida, New Mexico and Texas.

Right now, you can open a new checking account at BBVA Compass Bank and get a brand new 8 GB Apple iPod Touch for doing so.
Just go to the bank’s web site to register. You’ll need to enter your account number along with your claim code to get the iPod. You’ll also need a minimum of $100 to open the account.

You have to open the account by Dec. 15 and have your paycheck added to your new account via direct deposit within six weeks of opening your account.

Note, too, that you’ll have to report the iPod (worth $180) as a gift on your 2009 tax returns.

Certificates of Deposit

Jacksonville (Fla.) Bank has a nice deal on its six-month, one-year and two-year bank CDs. Check it out.

Six-month CD – 1.75% APY
One-year CD – 2.25% APY
Two-year CD – 2.60% APY

Compare that to the BankingMyWay National CD Rate Tracker this week:

Six-month CD – 0.64%
One-year CD – 0.99%
Two-year CD – 1.42%

You don’t have to be a resident of the state of Florida to qualify for the great rates – all you have to do is apply online and be prepared to have your funds transmitted via electronic fund transfer.

For more information, visit this site.

Bank Savings Accounts

Ridgestone Bank is offering a 2.5% APY for new subscribers to its Momentum Savings Account and Momentum Checking Account. And, you earn a $50 bonus for signing up (but you’ll have to open a direct deposit account to get the bonus).

According to the bank’s Web site, you’ll have to open both accounts to qualify for the great rates, and the rates only apply for account balances between $2,500 and $49,999. Anything higher and the rate slides to 1%. Anything lower and the rate falls to a piddling 0.25%.

You’ll have to agree to receive your monthly bank statements online and agree to make at least eight transactions a month, including checks and debit cards.

You can’t apply for the deal online, but you can sign up via telephone, at either (847)805-9520 or (262)789-1011.

For more information, visit Ridgestone's Web site.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Costco Bounces Coke Products

The Associated Press — Wed, 18 Nov 2009 10:29:44 -0500

By Emily Fredrix & Sarah Skidmore, AP Food Industry Writers

ATLANTA (AP) — Costco customers may have to look elsewhere for Coca-Cola products now that the retailer has stopped carrying them because the pair are fighting over prices.

The public squabble between one of the nation's largest wholesale club operators and the world's largest soft drink maker is likely to fizzle quickly. But it reveals real tensions as retailers and product makers square off on prices.

As shoppers continue to grapple with the recession, retailers want to win their favor by giving them low prices. But that has been creating tension between product makers like Coca-Cola Co., who are working hard to maintain profit margins while meeting retailer demands.

Typically such negotiations take place behind the scenes, but once in awhile, a public dispute erupts.

"Beneath this surface of harmony, it's a dogfight out there," Gerry Khermouch, editor of Beverage Business Insights, said Tuesday at an investor meeting held by the soft drink maker at its hometown of Atlanta.

Retailers want to wield more power in determining pricing with product makers, who they depend on to stock their customers' favorite brands, Khermouch said.

Costco has been aggressive in putting up signs on store shelves and notices on its Web site.

"Costco is committed to carrying name brand merchandise at the best possible prices. At this time, Coca-Cola has not provided Costco with competitive pricing so that we may pass along the value our members deserve," said a message on the company's Web site labeled "Price Alert!"

A Costco executive confirmed the move Monday but would not discuss the matter further.

The wholesale club operator, based in Issaquah, Wash., is not removing products like Coke and Diet Coke from store shelves, but it does not plan to restock them "until the matter is resolved," according to the message on its site.

Coca-Cola said in a statement late Monday it won't comment on ongoing negotiations but said Costco is an important customer and that it is committed to working with it "in a spirit of fairness."

This dispute is notable given the size and visibility of both companies, said Jim Hertel, managing partner at retail consulting firm Willard Bishop.

"It's not unprecedented, but it doesn't happen every day," Hertel said.

Earlier this year grocer Delhaize SA in Belgium said it would no longer stock at least 250 Unilever products because the food and consumer products maker was making "unprecedented" demands that would force retail prices up 30 percent, the two companies reached an agreement within months.

But the pricing pressure is more intense at Costco, whose business model is designed around offering lower prices than traditional retailers.

Hertel said most likely, the companies will recognize there is a mutual interest and will find a way to resolve it.

"These are complex relationships and hugely valuable," he said.

Who will win? Beverage analysts said don't bet against that famous logo.

"This is not going to bully Coke into changing its pricing strategy," said John Sicher, editor of trade publication Beverage Digest. "I think Coke is going to basically be focused on the right price and right market for its products, no matter what."

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Employer Stock: Blessing or Curse?

Jeff Brown — Wed, 18 Nov 2009 09:12:05 -0500

Is company stock making a comeback?

A new study by Charles Schwab (Stock Quote: SCHW) finds many companies renewing emphasis on using their own stock to reward and motivate employees.

About 25% of the 200 firms polled said they would increase stock-related benefits in the next year, while 68% said they would maintain their stock plans at current levels despite economic woes causing firms to trim other forms of pay and benefits. The survey covered stock offered through options, through restricted-share programs that vest over time and through performance-based rewards.

Other studies suggest that many employees are starting to increase employer stock purchases through 401(k) plans.

Which leads to the question: Are employees taking too much risk?

The strategy of investing in employers' stock got a black eye in the Enron collapse of 2001, when thousands of the energy company’s employees lost both their jobs and retirement savings.

Afterward, many financial advisers urged employees to lighten up on company stock. The Pension Protection Act of 2006 gave employees with three or more years on the job the right to sell shares obtained from employer matches of 401(k) contributions. Employees can sell shares acquired with their own contributions at any time.

Still, about 10% of 401(k) assets are held in company stock, and some employees keep the bulk of their accounts in employer shares, according to the Employee Benefit Research Institute.

Most experts argue that individual investors, especially those who are not savvy stock pickers, should have no more than 10% of their holdings in any single stock. On the other hand, many people do get rich with holdings in a single company. Just ask the employees who got in on the ground floor of Microsoft (Stock Quote: MSFT).

The 10% rule generally applies to the investor’s entire portfolio. There may be nothing wrong with having 20%, 30% or 40% of your 401(k) in company stock if you have lots of well-diversified holdings outside of your 401(k).

Still, employees are wise to look at employer stock just as they would any other firm’s. In other words, would you buy it if you didn’t work there? If the answer is “no,” you should probably steer clear of it. If the firm offers shares at a discount, you can sell soon after getting them, pocketing a quick profit.

If the answer is “I don’t know,” you may not be practiced enough at stock analysis to bet on individual stocks from any company. This is why most small investors are better off with mutual funds, which leave the stock picking to the pros.

Many employees invest in their own firm out of a sense of loyalty, or because they feel they know the firm well. Many employers offer company stock because they think a share of ownership gives employees an incentive to work harder. But employees should put these considerations aside and focus on expected returns.

For an investment in employer stock to make sense, it has to offer a better return than you can get elsewhere. In fact, it would have to do considerably better to offset the risk of having so many eggs in one basket.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

iPhone App of the Week: Minding Your Miles

Stephen Dalton — Wed, 18 Nov 2009 07:00:00 -0500

The week we look at an iPhone app that will help you save on your taxes and keep track of driving expenses.

Black Friday: 10 Reasons Not to Shop

Althea Chang — Wed, 18 Nov 2009 07:00:00 -0500

Are you financially stable enough to shop for the holidays?

Bizarre Money-Making Schemes

Seth Fiegerman — Wed, 18 Nov 2009 07:00:00 -0500

People will do anything to make a few bucks, especially in a recession. Here are some of the strangest stories.

Unemployed Flock to Jury Duty

David Seaman — Tue, 17 Nov 2009 16:45:00 -0500

With great power comes great responsibility, but not a great paycheck. In fact, serving as a juror in a Manhattan court typically pays $40 a day — windfall! Unless your employer pays you during jury duty, in which case you get nothing at all from the courts except for the wellspring of hot pride that results from doing a citizen’s duty. But what if you’re unemployed and really want a shot at those 40 big ones?

According to the friendly bloggers at Consumerist, eagle-eyed justice enthusiasts who happen to be out of work are calling up Manhattan’s jury division clerk and saying things like, “Look, I lost my job; now would be a good time for me to serve.”

You can actually do this yourself to make money. About 20 people have requested to serve since May. Normally, jury duty is the absolute last thing anyone would volunteer for, but with unemployment running at 10.2% right now, many people could use an extra $40 a day.

Plus, Manhattan’s jury division chief clerk has noticed a “more diverse” group of jurors lately, saying that the court is “getting a lot of Wall Streeters and other professionals.”

If you’re on the fence about volunteering, consider this: It’s sort of like the 3D, live-action, fully interactive version of watching Nancy Grace, combined with the most tedious John Grisham novel you have ever read. Want to give it a go? Here’s a link to the commissioner’s contact information for New York State.

If you live in another state, contact your local commissioner of jurors or court clerk and see if you can request service.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Leave Your Credit Cards At Home

Seth Fiegerman — Tue, 17 Nov 2009 16:00:00 -0500

Wouldn’t it be nice to slim your wallet and leave your credit cards at home? Or better yet, just get rid of them all together?

Well, a new mobile application promises to be the next step in making this a reality.

ShopSavvy, which is available on Android-based phones and the iPhone, bills itself as a tool to help users “bridge the gap between shopping online and shopping at the store.”

The New York Times reports that shoppers can “use the phone’s camera to scan an item’s bar code in a store to see if it is available for less online. If so, the shopper can buy it with one click.”

The application relies on PayPal, a service that has helped many companies digitize purchases and even paychecks. PayPal may play an even greater role in the future of virtual transactions.

“What we’re trying to do and what we think is very important is to displace the use of cash or checks,” Scott Thompson, the president of PayPal, told The Times. “We’ll just have one wallet, and it lives in the cloud.”

We just hope that cloud is under lock and key so our information doesn’t rain down everywhere.

In the meantime, some credit card companies are working on this goal, too.

Earlier in the year, Visa introduced a system for cell phone payment that allows users to scan their phone in place of swiping a card. This tactic of mobile phone payments has become popular in Asia. The service will likely be available in the U.S. later next year.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Turning a Holiday Gig into a Permanent Job

The Associated Press — Tue, 17 Nov 2009 14:30:05 -0500

By Chip Cutter, AP Business Writer

NEW YORK (AP) — As companies hire extra workers for the holidays, some of these seasonal employees are already wondering: How do I turn this temporary position into something permanent? And, in this economy, can I?

Retailers who are typically big seasonal employers are suffering through a prolonged slump in consumer spending that's forced many to cut back staffing. Other employers such as the United States Postal Service have implemented hiring freezes. So, while these companies are employing temporary help, they don't expect to make many permanent offers.

Still, personnel consultants and company executives say there are plenty of opportunities for hard-working seasonal employees to stay on even after the new year. Shipping giant UPS Inc., for one, says it could eventually hire thousands of workers who make it through the frenetic holiday season.

The first step in nabbing a job: Make it clear that you're interested in the company, and looking for a permanent role. Most seasonal workers never get a chance at other jobs because they simply never ask, said Jeff Joerres, the CEO of staffing company Manpower.

But be tactful, and don't pester management.

"Make yourself available for additional opportunities," he said. "But don't over extend yourself."

More tips for making the transition from temporary help to full-time employee:

REMEMBER THE BASICS

Even when a job is short-term, employees need to behave as they would in a full-time, permanent position. So, arrive on time, follow your schedule and don't request time off work unless it's absolutely necessary.

Seasonal workers do to tend to get the less desirable shifts, such as late nights and weekends. But to make a good impression, just smile and keep working hard.

"In a temporary employee, that's the No. 1 thing employers look for: reliability and dependability," said Craig Rowley, vice president of the global retail sector for the Hay Group, a consulting firm.

Along with that, show that you're willing to be flexible. If managers ask you to work longer, do it. Likewise, if they need someone to pick up an extra shift, be the first to volunteer.

Small gestures can go a long way in winning over employers, Joerres said.

"There's an amazing amount of people who show up for work and want to collect a paycheck and don't show that they want anything more than that," he said. "And I think that disappoints employers."

AUDITIONING FOR A JOB

A seasonal job, like an internship or temporary gig, is truly a multi-week job interview.

Supervisors watch to see how well employees fit with the company, and they quickly judge how easily workers pick up on new tasks.

That's because many companies treat seasonal positions as "auditions to find some of their best people," said John A. Challenger, chief executive of consulting firm Challenger, Gray & Christmas.

To stand out, look for ways to "wow" customers and demonstrate a mastery of the business.

At the high-end kitchen retailer Sur La Table, CEO Jack Schwefel says the best seasonal workers are the ones who are able to interact with customers on a personal basis while also explaining the key differences between products, such as a copper-bottomed pot versus a steel one.

Sur La Table will hire about 2,000 seasonal workers this year to work in its stores and distribution warehouses, essentially doubling the size of the company's work force. Schwefel said up to 20% of those seasonal workers could eventually be offered either permanent part-time or full-time jobs.

REALIZE: OPPORTUNITIES DO EXIST

In fact, companies across a variety of industries say they're still interested in hiring their temporary workers, even amid the recession.

UPS plans to hire about 50,000 seasonal workers this year. Some of those employees will work in the company's hubs, loading and unloading trucks, while others will be on the road with drivers going door-to-door to deliver packages.

The jobs can be exhausting, given that the holidays represent the company's busiest time of the year.

But spokeswoman Karen Cole said employees who make it through peak season could be in a prime position to land a permanent job, initially on a part-time basis. The company hopes to hire about 20% to 30% of its temporary work force this year.

At the staffing firm Manpower, the company hires about 10,000 seasonal employees to work for distribution centers, credit card processing facilities and other companies during the holidays. About 40% of those workers could eventually snag a permanent job, Joerres said.

That's certainly good news for people like Steve Brannigan.

The 46-year-old was laid off from his job as a manufacturing engineer in the auto industry near Detroit about two years ago. He worked a couple of odd jobs, but couldn't find another full-time position.

So, he recently moved to Portland, Ore., to be closer to relatives, and is now working two seasonal jobs: one at an ice skating rink, and another in the bakery department of a Costco store.

He's hoping one of them will lead to a permanent position.

"I hope to find a job out here," he said, and "hopefully, a career."

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

5 Signs You’re Addicted to Credit Cards

Brian O'Connell — Tue, 17 Nov 2009 13:45:00 -0500

How do you know if you have an unhealthy attachment to your plastic — and are potentially vulnerable to a mountain of debt? BankingMyWay has five red flags that suggest your relationship with your credit card is headed into addiction territory.

First, know that Americans, even despite these though financial times, love their credit cards. Check out these statistics:

In 2008, consumers had an average of 5.4 cards, according to an Experian (Stock Quote: EXPN) market report.
The U.S Census Bureau reports that there were 159 million credit cardholders in the U.S. in 2000, 173 million in 2006 and it estimates that number will hit 181 million by 2010.
The Census Bureau also reports that there were nearly 1.5 billion credit cards in use in the U.S. in 2006. According to The New York Times (Stock Quote: NYT), a stack of all those credit cards would reach more than 70 miles into space, and be almost as tall as 13 Mount Everests.

Why do we have so many credit cards? Maybe it’s the way we view credit.

Historically, credit cards aren’t that ancient — in fact, they’ve only been with us for about 50 years. The first widely accepted credit card was issued in 1958 by American Express (Stock Quote: AXP) and the first general-use credit card that allowed balances to be paid over time was the BankAmericard (later changed to Visa (Stock Quote: V) which came out in 1959.

The idea, at least from card issuers, wasn’t to spend money you don’t have with a credit card. Rather, it was a convenience — you didn’t have to stop at the bank for cash to buy those Chuck Taylor basketball sneakers. You could use your plastic instead, thus saving you a trip.

But over time, too many U.S. consumers decided that credit were essentially free money for the time being, and thus spent happily without worrying about the bill coming due in 30 days (and even then, a minimum payment would suffice).

The “spend now, worry later” mindset is one we've had for the past 20 or 30 years, and it took a major economic downturn to snap us out of it. Data is emerging that Americans are doing a better job in keeping balances low and using their cards more sparingly post-recession.

But, if that doesn’t sound like you, and you’re worried that you still view credit cards as “free money” maybe it’s time to get a grip.

To see if you’re addicted or not, check the following list of “red flags” that indicate your attachment to your plastic is an unhealthy one:

1. You have both a debit card and a credit card in your wallet, but use the credit card to make a purchase. It’s smarter to use the debit card and pay as you go. Using the credit card only adds to your debt burden.

2. You own two or three store credit cards. Getting into the habit of having plastic in your pocket is a sure sign that you have an unhealthy attraction to credit. Pare back the store credit cards and use cash or a debit card to make store purchases. Better yet, stay out of the mall altogether and buy your clothes and shoes at discounters like Marshall’s or TJ Maxx (Stock Quote: TJX).

3. You only pay the minimum balance. If you can’t use a credit card, and then pay off the balance within a reasonable amount of time (say, three months or less) that suggests you’re too dependent on your card. If you can’t pay more than the minimum balance, put the card in a desk drawer until you do pay it off.

4. You spend more than you earn. If, at the end of the month, your credit card balance exceeds your monthly income, you’ve got a real problem. If that happens, get the scissors out and cut the card up and work to pay off the debt. Don’t close your credit card account, though — it could hurt your credit rating.

5. Take the “emergency” test. If you habitually use a credit card, and want to stop, try this tip: When you have the merchandise in hand, ask yourself if it meets the "emergency" standard that credit cards should operate under. A broken-down car on the highway is a real emergency — a sale on leather jackets or tickets to a ballgame isn’t.

The trick in detaching yourself from unhealthy credit card practices isn’t a complicated one. Just look at your credit card statement first.

Then, if you look in the mirror and don’t like what you see, it’s time to cut the cord — and cut up your cards.

Hopefully, then you’ll have a much healthier addiction — an addiction to cutting debt out of your life.

Financially at least, you’ll live happier ever after.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Who’s Hiring Part-Time: UPS, Key Bank and Sherwin-Williams

Bobbi Dempsey — Tue, 17 Nov 2009 13:00:00 -0500

Looking for part-time work? You’re in luck. Here are three companies with part-time openings available right now.

UPS (Stock Quote: UPS)

What They Do: Major shipping and delivery company.

Types of Part-Time Position(s) Available: Package handlers and driver helpers; they have many temporary/seasonal openings during the holiday season, but also have lots of opportunities for permanent part-time workers.

Desired Hours Per Week: Around 20 hours per week. Several shifts are available; many driver helpers work between 8 a.m. and 8 p.m. on weekdays, but there are some package handler shifts available during late night and early morning hours.

Starting Pay: About $9.50 an hour.

Benefits: Permanent part-time employees get health benefits, tuition assistance, discounts on various retail products.

Requirements: Ability to work quickly and lift packages up to 70 pounds. Driver helpers must have good customer service skills and enjoy working with people.

The Inside Scoop: Driver helpers don't actually have to drive the vehicle; they meet the driver at an agreed-upon location, and take packages from the truck to homes or businesses at stops along the route.

Apply here.

Next Page: Key Bank
Key Bank (Stock Quote: KEY)

What They Do: Bank chain with more than 1,000 branches in 14 states.

Types of Part-Time Position(s) Available: Tellers.

Desired Hours Per Week: Around 20 hours per week, generally during daytime business hours, but some Saturday shifts may be required.

Starting Pay: "Competitive" hourly rate.

Benefits: Health coverage, retirement plan, discounts on company products and services.

Requirements: High school diploma or business experience, cash handling experience, ability to use calculators and office equipment.

The Inside Scoop: Company stresses the importance of customer service and friendly attitudes. You'll be expected to greet customers by name whenever possible and to always smile and make eye contact.

Apply here.

Next Page: Sherwin-Williams

Sherwin-Williams (Stock Quote: SHW)

What They Do: The nation's largest retailer of paint, stain and wall coverings.

Types of Part-Time Position(s) Available: Customer service.

Desired Hours Per Week: Up to 32 hours per week; some weekends may be involved.

Starting Pay: About $10 an hour.

Benefits: Medical, retirement plan, company discounts.

Requirements: Previous sales experience; knowledge of paints and related products preferred.

The Inside Scoop: Must have valid driver's license and be able to pass a background check.

Apply here.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Roth IRAs Mean Big Business for Finance Firms

Joe Mont — Tue, 17 Nov 2009 12:15:15 -0500

BOSTON (TheStreet) — Plug "Roth IRA conversion" into a search engine, and it will spit out online calculators and stories seeking to explain whether the move is worthwhile.

Major retirement-investment players — Fidelity, Charles Schwab (Stock Quote: SCHW), Vanguard and T. Rowe Price (Stock Quote: TROW) — are setting aside space on their Web sites for the individual retirement account created in 1997 and named after its chief legislative sponsor, the late Sen. William Roth.

The companies are positioning themselves to be front and center for good reason. In addition to the value that a Roth conversion may provide for investors, financial advisers may be able to attract customers in what has become the hottest topic in retirement investing.

Roth IRAs differ from traditional IRAs in several ways. While you don't get a tax deduction for making a contribution to a Roth IRA, those contributions grow without taxes and you don't have to pay any tax upon withdrawal in retirement. And Roth IRAs aren't subject to the same minimum distribution requirements that traditional IRAs are, so you can take out money when you want to.

Starting on New Year's Day, investors will be able to move retirement assets, such as those from traditional IRA or 401(k) plans, to a Roth IRA regardless of their income level. The $100,000 salary cap will be waived. Whether the advantage of tax-free investment growth, as offered by a Roth plan, is more beneficial than paying taxes upon distribution is a question many people are having a hard time determining. For example, converting to a Roth IRA may not make sense if you can't afford to pay the upfront taxes. Conversely, a Roth plan might be a worthy hedge against a rising tax bracket.

A recent survey by Fidelity found that 82% of investors planned to seek professional assistance with the conversion process, either from a financial adviser or a tax- or estate-planning specialist.

In response, the firm has made an effort to load up its Web site with information about Roth conversions. Last week, joining its collection of fact sheets and how-to articles, the mutual-fund firm launched what it's calling a "Roth IRA conversion tool."

The service is comprehensive yet easy to use. Needed information is prompted via a series of basic questions, and users receive an instant assessment if they're likely to benefit from a Roth IRA conversion. They can also experiment with varying scenarios of how much is converted. The tool illustrates how changes in factors, like tax rates or withdrawal rates, might affect the outcome of a conversion.

For existing Fidelity clients, much of the form is automatically populated using personal data, state-by-state tax statistics and actuarial tables.

"We try to educate individuals, and hopefully the education and value we provide will encourage a broader relationship with Fidelity or an initial relationship," says Chris McDermott, the firm's senior vice president of investor education, retirement and financial planning. "We want to help people get their arms around how that impacts their personal situation because there are a lot of nuances to this."

Getting to the crux of those personalized details is spurring the growth of these online tools.

"How do we get someone to engage in this dialogue and educate themselves?" McDermott asks. "Easy-to-digest content and articles, as well as guidance tools like the one we've just launched, support this dialogue both from an advisory standpoint as well as a self-directed perspective."

In a recent survey, Schwab researchers found that more than a quarter of those polled described the conversion opportunity as "more confusing than health-care reform." Of the 400-person sample, only 14% said they were "extremely confident in explaining the Roth IRA conversion rule changes," and 71% said they would likely consult with a financial adviser. Forty-nine percent say they would consult a tax planner.

To fill the need for knowledge, Schwab has a dedicated area of its Web site set aside for comprehensive guidance regarding Roth conversions.

"The rules are fairly complex and can be confusing to an individual," says Bryan Olson, head of portfolio consulting for Schwab. "Without question, something that is both new and confusing creates opportunity to educate and potentially get new business. We are proactively reaching out to clients on the topic, because we know that the majority of people are unaware of the pending rule changes."

As investors learn more about the conversion opportunity, Olson expects to see participation move beyond initial expectations come Jan. 1.

"If you look at our survey, 72% said they are not planning to convert, but then, when you look at the responses, 61% percent said they aren't aware of the changes," he says. "It makes me think there is a big gap in knowledge and that a lot of people say they are not going to convert because they don't know about the conversion just yet."

Online resources, Olson says, are "helpful in terms of getting the thought process started."

"I think we are hoping that it gets enough people engaged in the process and as they start to see the variables that are included, and the assumptions that need to be made, it will lead them to start asking questions and thinking, 'Maybe I do need some expert advice here.' "

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Meet Jim Cramer Tonight

Kali Geldis — Tue, 17 Nov 2009 11:30:00 -0500

Don't get mad, get even. You’ll have the chance to do just that tonight at 7 p.m. in Manhattan when you get to meet Jim Cramer.

The man behind CNBC's Mad Money and our sister site, TheStreet.com, will be at the Union Square Barnes & Noble to discuss his new book, Getting Back to Even: Your Personal Economic Recovery Plan.

If you're one of the many people on Main Street who lost a good portion of their hard-earned savings, come listen to some advice on how to take advantage of current market conditions from the best-selling author. The event also includes a signing, but if that isn't enough to tempt you, here's a tidbit of what you'll be missing from Getting Back to Even:

"Why should you listen to me, and what makes this book so different from the standard fare? I'm a stock guy after all, and aren't stocks what got us into this mess in the first place? Look, I have been at this for thirty years. Unlike the usual peddlers of financial advice, I actually made myself rich by investing in the stock market and managing the money of my wealthy clients at my old hedge fund ... . But beyond that, I've also been where you are right now. I know what it's like to lose a vast amount of money in a short period of time. I know how it feels to have my very future on the line. I understand the stress and the fear, but I also understand how to come back."

Don't miss out on Cramer's 25 new rules for post-apocalyptic investing and his 12 stocks to watch in the economic recovery, all detailed in the book.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

CD Rate Trends This Week: Nov. 17

Brian O'Connell — Tue, 17 Nov 2009 11:00:00 -0500

Certificate of deposit rates pulled back further last week, in an economic environment where policymakers are in no rush to raise interest rates, and banks and lenders aren’t in a position to follow suit.

For the week, not a single CD rate category pushed upward. Down at the low end, three-month CD rates fell to 0.42% from 0.44%, while six-month CDs slid to 0.64% from 0.67%.

One-year CDs sunk, as well, to 0.99% from 1.02%, and two-year CDs fell to 1.44% from 1.47%. Four-year models dug a deeper hole, falling to 1.92% from 1.97%, and five-year CDs treaded water at 2.28%.

All updated rates come courtesy of the BankingMyWay Weekly CD Rate Tracker.

These scenarios shouldn’t change any time soon — not as long as the Federal Reserve promises to keep interest rates down. That’s exactly what Fed Chairman Ben Bernanke said this week. Appearing at the Economic Club of New York on Monday, Bernanke told his audience that the Fed was determined to keep rates down as long as it would take until the economy perked up again.

There may be one way out, but it’s not exactly the path of least resistance. The dollar is currently being hammered in global currency markets, marking double-digit declines during the past six months. Typically, lower interest rates put downward pressure on the dollar which, at this time, isn’t viewed as a major danger by economists. In fact, it might even help spur the economy.

Here’s an example: As Bernanke pointed out in his New York speech, commodities like oil and gas are priced in dollars, so they’re cheaper to buy when the dollar is in decline. When consumers and businesses buy more oil, for example, that helps the economy, which is the Federal Reserve’s “big picture” priority right now (dollar be damned). Bernanke, after all, said "we use our interest rate tools to try to meet our mandate — full employment and price stability.”

The fact that the weakening dollar makes exports cheaper also contributes to the U.S. economy, making the Fed even less likely to raise rates to buck up the dollar.

Of course, the Fed can’t let the dollar go into free-fall. That would likely lead currency investors to dump the dollar and really put the U.S. economy between a rock and a hard place. But foreign investors are between a rock and a hard place, too. Take China, which is the single largest investor in U.S. assets. A declining dollar threatens those investments, and that’s a legitimate concern to the Chinese government. China is also the third-largest seller of consumer goods to the U.S., so if it pulled out of its U.S. investments in a major way, that would not only hurt the U.S. economy, it would strike a blow against the Chinese economy, too — given all the computer equipment and blue jeans we buy from the Asian Tiger.

Consequently, the status quo is the best option for U.S. policy makes and foreign investors — if not for domestic bank CD investors. That won’t change before the Fed’s Open Markets committee meets in mid-December, where the decision will likely be made to hold interest rates steady. So look for more of the same going forward, at least for a month.

Some banks will raise CD rates anyway, if only to get new customers in the house before the economy improves. Find the ones with the best deals at BankingMyWay. There you’ll find some of the best CD rates out on the marketplace, all at the click of a few keystrokes.

Right now, that’s the best move a CD investor can make. Unless you count waiting for the glacial-minded Federal Reserve to act as a “good move.”

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Fed Targets Gift Card Abuse

The Associated Press — Tue, 17 Nov 2009 09:45:34 -0500

By Jeannine Aversa, AP Economics Writer

WASHINGTON (AP) — The Federal Reserve on Monday proposed new rules to protect consumers from unexpected costs or restrictions on gift cards.

More than 95% of Americans have received or purchased gift cards, the Fed said.

Under the proposed rule, consumers must have at least five years to use the gift cards before they expire. The Fed also said service or inactivity fees can be imposed only under certain conditions.

Such fees can be charged if the consumer hasn't used the card for at least a year, if the consumer is given clear disclosures about them and no more than one fee is charged a month, the Fed said.

The Fed was directed to take the action under a law Congress passed in May.

"Consumers who do not use the value of the card within a short period of time may be surprised to find that the card has expired or that dormancy or service fees have reduced the value of the card," the Fed explained. "Even where fees or terms are disclosed on or with the card, the disclosures may not be clear and conspicuous."

The public, industry groups and other interested parties can comment on the Fed's proposal, which could be revised before a final rule is adopted.

The Fed said the new provisions are slated to take effect Aug. 22.

"These rules are the right step, but it would be far better for them to take effect in time for this holiday shopping season," said Sen. Charles Schumer, D-N.Y., who championed the gift card crackdown in Congress. "We will continue to push the Fed to speed up the effective data so that we end abuses by gift card issuers as soon as possible."

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Is the Adjustable-Rate Mortgage Dead?

Jeff Brown — Tue, 17 Nov 2009 09:05:24 -0500

Take a glance at the latest BankingMyWay.com mortgage survey and you’ll see that rates on one-year adjustable-rate loans have gone up, while rates on 30-year fixed-rate deals are cheaper, with both hovering around 5%.

It raises a question: Are ARMs suitable for anyone these days?

Only a small subset of borrowers appears likely to benefit from adjustable loans in today’s market — people anticipating a financial windfall in the next few years. According to the Mortgage Bankers Association, adjustable-rate loans account for just 5.5% of recent mortgage applications.

The popularity of ARMs waxes and wanes as market conditions change. There are two chief reasons to opt for an ARM, and neither applies today.

First, ARMs often start with a low initial rate that means smaller monthly payments than on a fixed-rate loan of the same size, at least for the first year or two. If the ARM starts out at 3.5% and the fixed loan at 5.5%, the savings can offset the risk that the ARM’s payments could rise over time. Also, an ARM’s low starting payment can make it easier for the borrower to qualify for the loan, or enable the borrower to get a bigger loan.

Unfortunately, ARMs currently offer no upfront savings, while they still pose the risk of rates someday rising above the 5% you can lock in with a fixed-rate deal. That makes an ARM unappealing.

Second, an ARM can be an acceptable bet if one believes interest rates will stay low for a number of years, or fall lower. That will keep the ARM rate low once annual adjustments begin.

But today’s rates are so low the odds favor them going up over time, not down.

With neither of the basic ARM benefits applicable today, the only remaining benefit is found in an often-overlooked feature of ARM adjustments. With each adjustment, the new payment is figured by applying the new interest rate to the remaining principal or outstanding debt. That means the borrower can reduce the payment by making extra principal payments.

In contrast, extra principal payments on a fixed-rate loan allow the borrower to pay off the loan sooner, reducing interest costs over the loan’s life. But the required monthly payment stays the same.

The Mortgage Loan Calculator shows you’d pay $1,610 a month on a 30-year fixed loan of $300,000 charging 5%. An ARM for the same amount at that rate would charge the same.

Now suppose that two years after taking out the loan you came up with $100,000 from selling another property or investment, or from an inheritance.

Put the $100,000 into the fixed-rate loan and the payment will remain $1,610 a month, though the loan will be paid off 13 years ahead of schedule, saving nearly $150,000 in interest charges.

But if you put that sum into the ARM, the payment would fall to just $1,026, assuming the rate remained 5%. After the first five years, you’d still owe $275,487 on the original loan. Reducing that by $100,000 and figuring a new payment for the 25 remaining years slashes the payment.

At this point you could choose between paying only $1,025 for the next 25 years and continuing to pay $1,610 in order to pay the loan off 13 years early. Either way, the $100,000 principal payment will save you a fortune in interest costs. But if you had the ARM, you’d have the option of making a smaller payment if and when you wanted to.

Prepayments work the same way with three-, five- and seven-year ARMs, but your payment will not fall until the initial fixed period ends.

If the ARM approach appeals to you, use the shopping tool to investigate all types of ARMs for the best deals. Wells Fargo (Stock Quote: WFC), for example, has a five-year ARM starting at just 3.625%, and JPMorgan Chase (Stock Quote: JPM) has one at 3.25%.

—For more ways to save, spend, invest and borrow, visit MainStreet.com.

How I Got My Book Published

David Seaman — Tue, 17 Nov 2009 07:00:00 -0500

Wondering if it’s time to quit the 9 to 5 and try your luck at writing a novel? MainStreet caught up with literary insiders to see what the odds really are like.

Recalls: Blowers, Bikes, Batteries & More

Althea Chang — Tue, 17 Nov 2009 07:00:00 -0500

These products could burn, shock or otherwise hurt you.

The Most Shoplifted Items of 2009

Seth Fiegerman — Tue, 17 Nov 2009 07:00:00 -0500

These items flew off the shelves this year, often thanks to shoplifters.

Ridiculous Start-Up: Billionaire Auction Site

Seth Fiegerman — Mon, 16 Nov 2009 17:00:00 -0500

An economic downturn may not be the best time to try hawking multi-million-dollar goods, but that didn’t stop one group from launching the first ever luxury auction Web site.

BillionaireXchange.com made its debut last week, after a trial version of the site launched several months earlier. The site is marketing itself as the first and only online marketplace specifically designed for billionaires. But, as ABC reports, this may be a bit of a stretch.

“Co-founder Quintin Thompson says the ‘billionaire’ in BillionaireXchange is aspirational; the site is meant mostly for millionaires, but associating your company with millionaires is too ordinary to lure ultra-high-net-worth members,” according to ABC. Though, as ABC also points out, many billionaires (and even some millionaires) may not be the type to peruse auction sites online.

So, is anyone actually taking part in this auction? According to the co-founder, 12 billionaires signed up for the service and 68 transactions, worth a total of $180 million, took place during the trial period.

There are multi-million-dollar yachts, aircrafts and a Ferrari Enzo on sale. Many of the highest priced items currently on the auction block are real estate, such as this $9 million Italian castle, and even A-Rod’s mansion, which has a starting bid of $10 million. Hurry though, there are only 12 days left to buy it and that price will likely go up now that the Yankees have won the World Series and he’s no longer public enemy #1.

Yet, as of now, there are no bids for any of these items, according to the site.

Perhaps one problem is that the site requires all bidders to prove they have at least $2 million in liquid assets. This certainly limits their target audience.

Obviously, a luxury auction site needs to function a little differently than a site like eBay. For one thing, payments are not released until the person has received their item.

"If a $30 lamp doesn't show up, you're not going to be too crushed, but a $50,000 watch is a different story," the co-founder of the site, told The New York Post.

The lowest starting bid on the site is $1,000, and that’s for only the lowest tier of products. It does make sense when you think about it. Bidding $1,000 on a million-dollar product is the same as bidding a penny on a $10 purchase, but even more insulting.

So what can you get for a modest $1,000? A bottle of champagne.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Why You Should Consider a $0 Tax Refund

Miranda Marquit — Mon, 16 Nov 2009 16:15:00 -0500

Every year, millions of Americans look forward to their tax refunds. It always feels like a windfall since the average refund, according to the IRS, is more than $2,000.

But that money, for most people, isn’t really a windfall. It’s called a refund for a reason: That money is already yours. And you’ve been offering the government an interest-free loan.

Putting your money to work for you

When you get a tax refund, you are simply getting your own money back. It means you have overpaid on your taxes and the government has been using the excess for a year, while it hasn’t been benefiting you at all. Think about your last tax refund. You could have been using that money to your advantage all year by:

Paying down debt. High-interest debt is a money waster and getting rid of it can help you keep more of your money, instead of lining the pockets of your creditors.
Investing. Offering the government an interest-free loan means that you are getting nothing in return. What a waste of money! Instead, you could have been putting that money to work for you through investments. Even a CD or online savings account is a better use for your cash than lending it out without a yield.

Adjusting your withholdings

Chances are that, if you look at your W-4, you withhold a little extra each month for your taxes. Instead, fill out a new W-4, and only claim the necessary exemptions for your dependents. This way, you’ll end up with more in your paycheck that you can use to your advantage. Either use this money to make debt payments, or have it automatically deposited into a high-yield savings account or investment account.

If you are self-employed, you adjust your estimated taxes every year. Only pay what are you expected to according to the formula offered by the IRS. Be aware, though, that if you earned more this year than last year, you may owe additional taxes. If the discrepancy is larger than $1,000, you could be charged a penalty. But, if you have paid at least 90% of your taxes for the current year, or if you pay 100% of what was shown on last year’s return, your penalty will be waived.

Striving for a $0 tax refund is a smart move that can help you use your money more efficiently.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Holidays Not So Happy for Many Charities

The Associated Press — Mon, 16 Nov 2009 15:15:00 -0500

By Donna Gordon Blankinship, Associated Press Writer

SEATTLE (AP) — American charities have weathered a significant drop in giving this year, and while they're hoping for a holiday miracle, a recent survey shows they will probably see a decrease in year-end generosity.

In light of the economic downturn, only 38% of Americans say they are more likely to give a charitable gift as a holiday present this year, compared to 49% last year, according to a survey conducted by Harris Interactive..

Some of the biggest U.S. charities say they are budgeting for a disappointing Christmas.

The survey commissioned by Wash.-based World Vision indicates they are prudent to not raise their expectations for now.

The survey did find, however, that 74% of Americans plan to increase their charitable giving once the economy improves.

The nation's most successful fundraising organizations expected to see their income decline by an average of 9% in 2009, according to the Chronicle of Philanthropy.

Harris Interactive contacted 1,001 U.S. adults in a random telephone survey, and claims a 95% "confidence level."

About the same number of Americans are giving to charity these days, but they are giving fewer dollars, said Justin Greeves, senior vice president of Harris Interactive, which regularly polls Americans about their charitable giving.

Times are doubly tough this year for many nonprofits because the need for their services is increasing at the same time donations are decreasing, but Nancy Brown, chief executive officer of the American Heart Association, said her organization is doing its best to cut expenses not services.

"I say this to our staff all the time: 'Our mission is not in a recession'," said Brown. The Dallas-based nonprofit ended its fiscal year on June 30 with donations down about 11.8%, and a staff cut of 371 people or about 10% of its work force.

The charity did grow in two ways this past year: both the number of donors and the number of volunteers increased. "More people with less money is better than less people with less money," Brown said.

Northwest Harvest, operator of Washington state's largest food bank, also reported volunteerism was up this fall while cash donations were down.

Executive Director Shelley Rotondo said the statewide hunger relief organization distributed more food, in keeping with a record increase in need, during fiscal 2009 than in any time in the agency's 40-year history.

But that generosity is not continuing at the same pace this fiscal year.

Donations did not meet expectations during the first quarter of fiscal 2010, which ended in September, and Rotondo was not optimistic about the second quarter, thanks to state unemployment figures holding steady near 10%.

Donations to charities with more of an international mission did not see the same boost in generosity that groups like food banks saw in 2009.

World Vision saw individual cash donations drop by $33 million this past year, but government grants, corporate donations and staff cuts made up for most of the shortfall.

Devin Hermanson, senior director of the nonprofit's gift catalog, has high hopes for the holiday season, despite the fact that the agency's own survey points in the opposite direction. This year's survey found 57% of American adults planned to spend less on holiday presents, but that's better than last year's 71%.

"Now that things are getting ever-so-slightly better, people are thinking I am going to give my kids a little more this year than I have been giving," Greeves said.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Tuition Costs Increase Despite Sour Economy

Brian O'Connell — Mon, 16 Nov 2009 13:50:01 -0500

The College Board’s latest study on college tuition shows that the price for college has risen by 6.5% — right in the teeth of the recession. But all is not lost. For students and families, there are some more pleasant figures in the study, too.

BankingMyWay will open this — the week before Thanksgiving break for collegians — with a look at college prices going into 2010.

The Big Kahuna of college cost barometers is the College Board’s annual tuition report. This year, the study says that the average price for four-year public colleges climbed $29 on a year-to-year basis to $7,020. Tuitions at private four-year colleges rose 4.4% for 2008-2009 bringing the average yearly cost to $26,273, the College Board says.

The news isn’t all sour and dour. According to the study, the average college tuition bill is skewed by exorbitantly higher prices for select private and public colleges. That paints a different picture for families struggling to pay for college costs — a brighter picture, actually.

This from the College Board report:

About 19% of students enrolled in private four-year colleges attend institutions that charge tuition and fees below $18,000.
Thirty-two percent of full-time students enrolled in public four-year colleges and universities attend institutions that charge tuition and fees between $3,000 and $6,000.
While private four-year institutions have a much wider range of tuition and fee charges, only about 20% of all students attend colleges with tuition and fees totaling $36,000 or higher per year.

The College Board study is titled "Trends in College Pricing 2009 and Trends in Student Aid 2009." It’s well worth checking out. See a summary at the College Board Web site.

Another eye-opener from the college financial scene comes from Northern New York — Ithaca College, specifically — where the school is paying students who have been accepted to stay away for one year. The New York Times (Stock Quote: NYT) reports that Ithaca paid 31 accepted students $10,000 each to defer. The payouts came after Ithaca accepted too many new students, causing a housing crunch that it couldn’t fix.

Another program has Ithaca paying older students $2,000 to move off campus, thus freeing up dorm space.

Maybe Ithaca had done too good a job of resurrecting its admissions program. In 2008, the school saw admissions rates (or “yields” as they’re called in the recruiting world) were off by 11%. But with an aggressive marketing push, and slightly lower admissions standards, Ithaca was able to draw 20% more enrollees than it had expected. Thus, the $10,000 payouts to students to take the year off.

As the New Year beckons, and college acceptance season heats up, BankingMyWay will keep a closer eye on college cost issues. For now, prices are up, although most schools are doing what they can to keep students happy — and keep their sanity in tough economic times.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Student-Loan Defaults Rise with Unemployment

Joe Mont — Mon, 16 Nov 2009 13:25:34 -0500

BOSTON (TheStreet) — The weak economy and double-digit unemployment rates have caused student-loan defaults to hit their highest level in nine years. It's a trend that could cost the government billions of dollars and harm the creditworthiness of an up-and-coming generation.

Federal student loan borrowers are considered in default if they don't pay for 270 days. The default rate increased to 6.7% for fiscal 2007 from 5.2% in fiscal 2006, according to the most recent figures available from the Department of Education.

The rate represents borrowers whose first loan repayments came due between Oct. 1, 2006, and Sept. 30, 2007, and who defaulted before Sept. 30, 2008. Nearly 3.3 million borrowers entered repayment during that time, and more than 225,300 borrowers — divided among 5,776 institutions — defaulted.

Because federal default statistics are typically two years old by the time they are processed and released, the most current data is starting to reflect the recession's impact. That suggests that defaults could rise further.

In 1990, nearly one in four borrowers defaulted on their federal loans when default rates set an all-time high of 22.4%. The rate dropped to a record low of 4.5% in 2003.

"When a borrower falls 60 days or more behind in paying back a federal student loan, they are required to contact a guarantor and seek assistance," says Bob Murray, a spokesman for USA Funds, an Indianapolis-based loan guarantor. "Requests from lenders is up 20% year-to-year, so it's pretty clear that the economy is having a significant impact on the repayment success rates of students. We have a financial stake if a borrower defaults. We are on the hook financially for part of it."

USA Fund's employees have made 85 million phone calls to borrowers who were behind on payments. The group says these efforts and counseling helped avert defaults on more than 93% of the accounts it handles, preventing defaults on more than 1.5 million accounts that might have cost taxpayers $22.5 billion or more.

Kimberly Carter, repayment assistance manager for Boston-based American Student Assistance (AMSA), is used to hearing "get in line" when she reaches out to past-due graduates.

"There are options with federal student loans that are different from consumer debt or other types of debt," she says. "If we can just get them on the phone and talk to them, we can usually provide some assistance to them. You don't want to sound threatening or scare them, but they have to understand that their student loan is not going to go away, even if they file bankruptcy."

AMSA, a federally funded nonprofit, became the nation's first private student loan guarantor in 1956. It manages more than $45 billion in loans.

"In the past, our business model was about collecting on defaulted loans," Carter says. "About 10 years ago, we decided that we should focus on helping people keep their loans in good standing and preventing defaults and delinquencies before they occur."

That challenge will likely grow as students rely on more loans to finance their educations. According to the U.S. Education Department, federal student-loan disbursements for the 2008-09 academic year totaled $75.1 billion, a 25% increase over the previous year. The single largest beneficiary of these loans was Apollo Group (Stock Quote: APOL), a for-profit education company that owns the University of Phoenix. Federal loans constituted more than 86% of its $3 billion in tuition revenue.

Six months after graduation, when the first bill arrives, is often where problems first emerge. May's graduating class will start receiving bills this month.

There are several options for borrowers falling behind, including repayment plans with monthly sums that start low and increase along with the debtor's salary. A new option enacted by Congress on July 1 allows qualified borrowers to limit their monthly payments to 15% of their discretionary income. Payments can also be deferred up to three years if the borrower can prove a hardship, such as unemployment.

Congress is working on a package of financial aid reforms. A bill passed by the House in September that's awaiting approval from the Senate would remove private lenders from their middleman role in the distribution of federal loans. Proponents of the legislation say it could save the government $80 billion to $87 billion during the next 10 years, which could help increase the loan pool. The move could have a dire impact on lenders, such as SLM (Stock Quote: SLM), better known as Sallie Mae, which manages more than $192 billion in federal and private loans for more than 10 million borrowers.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Who’s Hiring Full-Time: Perot Systems, Symantec and United Online

Bobbi Dempsey — Mon, 16 Nov 2009 13:00:00 -0500

Unemployed? Worry not! Every Monday, MainStreet finds companies that are hiring full-time workers—right now.

Perot Systems (Stock Quote: PER)

Who They Are: Worldwide provider of information technology services and business solutions.

Where They Are: Headquartered in Plano, Texas, with 23,000 associates worldwide.

What They Want: They have a lot of tech openings. They also need people in customer service, health care and marketing.

Coolest Job: They need an Information Security Director in their Plano, Texas, headquarters who will oversee their security systems and operations. Job duties will include network forensics, data protection, loss prevention and disaster recovery. Candidate should have expertise in computer system audits, security architecture and computer network defense.

Apply here.

Next Page: Symantec

Symantec (Stock Quote: SYMC)

Who They Are: Provider of computer security, storage and systems management solutions.

Where They Are: Headquartered in Mountain View, Calif., with numerous other facilities worldwide.

What They Want: Most openings are tech-related. They also need people in marketing, sales and development.

Coolest Job: They need a Principal Online Crime Expert for their consumer security brand, Norton. Duties would include conducting original security research, spearheading projects to overhaul important threat communication vehicles and serving as a company spokesperson on security topics.

Apply here.

Next Page: United Online

United Online (Stock Quote: UNTD)

Who They Are: Online provider of consumer products and services; divisions include Classmates.com, MyPoints and NetZero.

Where They Are: Headquartered in Woodland Hills, Calif., with other offices in the U.S., Canada, Germany, India and the U.K.

What They Want: They have openings in software development, client services, marketing and sales.

Coolest Job: They need a Director of Loyalty and Direct Marketing who will oversee direct marketing programs, direct mail and packing inserts. This person will create, implement and improve customer loyalty programs and rewards campaigns. Requires college degree (MBA preferred), 10+ years in B2C marketing and good leadership and communication skills.

Apply here.

Next Page: Bonus Job!

Bonus Cool Job of the Week

Nickelodeon is seeking a Virtual Worlds Producer who will manage development of new multiplayer worlds for the kids, teen and family markets. This person will work closely with creative, marketing, technology and other teams to produce cool virtual worlds. Must have five years of industry experience in project management and game production.

Apply here.

Gen X: Why Do They Hate Their Jobs?

The Associated Press — Mon, 16 Nov 2009 11:40:43 -0500

By Martha Irvine, AP National Writer

CHICAGO (AP) — They're antsy and edgy, tired of waiting for promotion opportunities at work as their elders put off retirement. A good number of them are just waiting for the economy to pick up so they can hop to the next job, find something more fulfilling and get what they think they deserve. Oh, and they want work-life balance, too.

Sounds like Gen Y, the so-called "entitlement generation," right?

Not necessarily, say people who track the generations. In these hard times, they're also hearing strong rumblings of discontent from Generation X. They're the 32- to 44-year-olds who are wedged between baby boomers and their children, often feeling like forgotten middle siblings — and increasingly restless at work as a result.

"All of a sudden, we've gone from being the young upstarts to being the curmudgeons," says Bruce Tulgan, a generational consultant who's written books about various age groups, including his fellow Gen Xers.

This isn't the first time Gen Xers have faced tough times. They came of age during a recession and survived the dot-com bust of 2000. In recent years, though, more members of the generation — stereotyped early on as jaded individualists — had families or began settling down in other ways. It was time, they thought, to enjoy the rewards of paying some dues.

"We were starting to buy into the system, at least to some extent," Tulgan says, "and then we got the rug pulled out from under us."

Now, in this latest recession, nearly two-thirds of baby boomer workers, ages 50 to 61, say they might have to push back their retirement, according to a recent survey from Pew Research.

Meanwhile, on the other end of the age spectrum are Gen Yers, who are often cheaper to hire and heralded for their coveted high-tech knowledge, even though many Gen Xers consider themselves just as technologically savvy.

"It's so annoying," says Lisa Chamberlain, another Gen Xer who wrote the book Slackonomics: Generation X in the Age of Creative Destruction. ''First, it was always the baby boomers overshadowing everything. Then there was this brief period in the mid-'90s where Gen X was cool.

"Now it's, 'What are the new kids doing?' It's like 'Yo, hello, the Google guys are Gen Xers.'"

They can sound a little whiny. But there's also some evidence that Gen Xers really are being taken for granted at work.

One survey done this year for Deloitte Consulting LLP, for instance, found that nearly two-thirds of executives at large companies were most concerned about losing Gen Y employees, while less than half of them had similar concerns about losing Gen Xers.

The assumption is often that Gen Yers are the least loyal and most mobile, says Robin Erickson, a manager with Deloitte's human capital division.

However, she points out that a companion survey of employees found that only about 37% of Gen Xers said they planned to stay in their current jobs after the recession ends, compared with 44% of Gen Yers, 50% of baby boomers and 52% of senior citizen workers who said the same.

Everyone surveyed worried about job security. Gen X and Gen Y were most likely to complain about pay. But a "lack of career progress," was by far the biggest gripe from Gen Xers, with 40% giving that as a reason for their restlessness, compared with 30% of Gen Yers, 20% of baby boomers and 14% of senior workers.

Gen Yers, meanwhile, were more likely than the other generations to cite "lack of challenges in the job" as a reason they would leave, while baby boomers more often chose "poor employee treatment during the downturn" and a "lack of trust in leadership."

The Deloitte study warns of a "resume tsunami" once economic recovery begins, especially among Gen Xers, and notes that many executives were largely unaware of employee complaints unrelated to money.

Such findings don't surprise Rich Yudhishthu, a 37-year-old Gen Xer who's a business development consultant from Minneapolis.

"The lack of promotional opportunities has pretty much killed job loyalty within a generation," he says.

Liza Potts, a 35-year-old professor at Old Dominion University in Norfolk, Va., agrees, but also notes that the disillusionment took hold for many of her peers as far back as childhood.

"Many of my friends had hoped to have jobs like their parents — places they would stay forever that would take care of them like they did their parents. But then we saw that start to crumble for our folks," she says, recalling friends whose fathers and mothers got laid off from companies such as IBM or had to relocate.

Now worried about their own foreclosures, debt and unemployment, her generation is left to do the soul-searching their parents did.

"Is there still time to become something different? Must we just accept where we are? Is there time to innovate elsewhere?" asks Potts, who left her own career in the software and Internet industry for a life in academia. It's meant less money, she says, but also more freedom to choose her work hours and projects.

In Chicago, 40-year-old real estate agent Adon Navarette has taken on extra jobs to make it, from consultant for an energy supply company to starting his own health and wellness business. He's heard his peers sniping about other generations, but also thinks their experience with other rough economic patches makes them resilient, too.

It's a pivotal moment, he says.

"What's going to define me as a Gen Xer is how I come out of this. What's going to define me is, 'What have I done to allow myself to take advantage of the market when the market turns around?'" he says.

Sometimes, it means working for less money.

Jon Anne Willow, co-publisher of ThirdCoastDigest.com, an online arts and culture site in Milwaukee, is among employers who've recently been able to hire more experienced candidates for jobs traditionally filled by 20somethings.

They're hungry to work, she says. And as she sees it, that gives her fellow Gen Xers and the baby boomers she's hired a distinct advantage over a lot of the Gen Yers she's come across.

"When the dust settles, they'll be exactly as they were before and we'll just have to sift through them and take the ones that actually get it and hope the rest find employment in fast food," she quips.

Spoken like a truly jaded Gen Xer.
___
Martha Irvine is an AP national writer. She can be reached at mirvine@ap.org or via http://twitter.com/irvineap.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Mortgage Trends This Week: Nov. 16

Brian O'Connell — Mon, 16 Nov 2009 10:28:11 -0500

To get right to the point, mortgage rates are down again this week, scraping against historic lows as confidence in an economic rebound squares off against stock investors, who continue to bet on better times right around the corner.

That has led to not only volatility in the stock market, which Wall Street usually treats like a trip to the dentist, but to uncertainty among banks, lenders and creditors.

From Nov. 9 through Nov. 13, the Dow Jones Industrial Average rose more than 150 points, signaling more confidence from big investors. But the rest of the nation — especially consumers — remains wary. With new numbers coming out this week from big benchmark indicators like retail sales, inflation and manufacturing activity, maybe the economic view will crystallize a little bit more, though that still may not be enough to push rates higher.

For the week, mortgage rates were once again lower right down the line. Both 15- and 30-year mortgage rates, as measured by the BankingMyWay.com Weekly Mortgage Rate Tracker, fell back, with the former down to 4.52% from 4.63% and the latter off to 5.04% from 5.22%. Adjustable-rate mortgages slipped as well. One-year ARMs were the exception, rising up to 4.64% from 4.25%. But three- and five-year ARMs were in sick bay, down five basis points to 4.49%, and down eight basis points to 4.24%, respectively.

It wasn’t only consumer anxiety keeping mortgage rates pinned to the mat. The bond market has shown scant interest in longer-term Treasuries, with weak demand for both 10-year and 30-year Treasuries during the past few weeks. As regular rate watchers know, if bonds are weak, then mortgage rates usually are, too. We did see a temporary rise in mortgage-backed securities later in the week, but it wasn’t enough to offset the damage that had already been done.

There’s no question about it. If you’re looking to lock in a great mortgage rate, the future is right now. As banks get healthier, and the housing market grows inevitably stronger, mortgage rates will rise again — and we’ll look back at late 2009 as the good-old days.

So don’t let the sun set on a good deal. To find the best deals on mortgage rates, click on to BankingMyWay’s Mortgage Rate Search.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Roth Rules for Retirees: Know Your Tax Bracket

Jeff Brown — Mon, 16 Nov 2009 09:05:11 -0500

Ask an expert whether you should convert a traditional IRA into a Roth IRA and you’ll hear a lot about tax brackets. A conversion is more likely to make sense if you expect to be in a higher bracket in retirement than you are now.

But there’s another tax-bracket issue to consider: What would a conversion do to your tax rate in the year you do it? If it would lift your bracket much higher — from 15% to 25%, for example — it could pay to spread the conversion over two or more years to stay in the lower bracket.

Income tax must be paid on taxable portions of money converted from a traditional, tax-deferred IRA, just as if you were making a withdrawal in retirement. The taxable portions are investment gains plus original contributions that were tax deductible.

If you’d made $5,000 in deductible contributions and $7,000 in non-deductible contributions, and the account had grown to $30,000, the taxable amount would be $23,000. You would not have to pay tax on the $7,000 non-deductible contribution because that money had already been taxed.

If you converted the entire account in 2010, you’d add $23,000 to your taxable income. That could easily lift you into a higher tax bracket.

Fortunately, the same law that lifted the income test determining who is eligible to convert also provides for people who convert in 2010 to divide the tax bill evenly over 2011 and 2012. If you chose that option, a conversion done in 2010 would add nothing to your tax bill for that year, but it would add $11,500 to your taxable income in each of the following years.

Complicated enough? Wait, there’s another twist. If you have more than one traditional IRA, you have to blend them together to figure the taxable portion of the converted amount, even if you only convert money from one account. This is done by adding together the value of all the accounts and figuring what percentage of the total is taxable.

Imagine, for instance, that in addition to the $30,000 account described above, you had another account worth $50,000, all of it taxable because there had been no nondeductible contributions. The combined account value would be $80,000, with $7,000 in deductible contributions. The $73,000 in taxable value is 91.25% of $80,000. So 91.25% of the $30,000 you convert would be taxable — $27,375.

It’s all a big headache, and can be a nightmare for people who have not kept good records.

Once you figure the taxable amount you would add to income for 2010, or 2011 and 2012, look at tax-bracket tables. The 2010 tables are not out yet, but CCH Inc., a tax-analysis firm, has a projection. It shows that a married couple filing a joint tax return would move from the 15% bracket to the 25% bracket when income exceeded $68,000. If a conversion pushed the couple over this line, it might pay to spread the conversion over two or more years to stay in the 15% bracket.

Keep in mind that various deductions and credits are subtracted from total, or gross income, to arrive at taxable income. A couple with $68,000 in taxable income would be earning $75,000 or $80,000. You can find your taxable income on your most recent tax return — line 43 on Form 1040.

Use the Roth IRA Conversion Calculator to see if this move makes sense, and take a look at the conversion tips offered by the brokerage firm Charles Schwab (Stock Quote: SCHW) and fund company T. Rowe Price (Stock Quote: TROW).

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Consumer Outrage: Hotel Horrors

David Seaman — Mon, 16 Nov 2009 07:00:00 -0500

Most hotel experiences are pleasant and relaxing—but here are a few less than glowing accounts.

Egg to Plate: The Life of a Chicken

Althea Chang — Mon, 16 Nov 2009 07:00:00 -0500

Here's a step-by-step rundown of everything a chicken goes through before it lands in your belly.

Cool New Cars Under $5K

Seth Fiegerman — Mon, 16 Nov 2009 07:00:00 -0500

Our list of the cheapest cars in the world, hands down.

Who's Hiring This Week? (Nov. 15)

MainStreet.com Staff Writers — Sun, 15 Nov 2009 07:00:13 -0500

Check out MainStreet's round up of companies hiring full-time, part-time, freelance and telecommuting workers.

A Produce Trick to Save Cash

Althea Chang — Sun, 15 Nov 2009 07:00:00 -0500

Here’s how to cut your grocery bill and reduce wasted food without skimping on flavor or opting for cheaper but less wholesome options.

Best of the Week: Forbidden Gifts, Landlord Secrets & More

David Seaman — Sat, 14 Nov 2009 07:00:00 -0500

The gifts you should never give to a boss, finding your financial soul mate, uncovering landlord secrets & more. Don't miss this week's roundup.

Luxury Rentals on a Serious Budget

Seth Fiegerman — Sat, 14 Nov 2009 07:00:00 -0500

Want a truly memorable vacation? Consider this: you and your family can spend a week in a palace for less than $1000. Just try vacation rentals.

Black Friday Deals Already in Stores?

Glenn Hall — Fri, 13 Nov 2009 17:13:41 -0500

NEW YORK (TheStreet) -- Many retailers are preempting the Black Friday 2009 deals that traditionally arrive over Thanksgiving weekend and are desperately rolling out their Christmas specials in advance.

Even before Halloween, I started seeing Christmas decorations and prices appearing in stores. Sears (Stock Quote: SHLD) may well have been the first when it launched into its "Black Friday Now" campaign that started in October.

The Internet is now abuzz with blog reports about early Black Friday deals being offered by Best Buy (Stock Quote: BBY), Wal-Mart (Stock Quote: WMT), CVS (Stock Quote: CVS) and others. Target (Stock Quote: TGT) even created a Black Friday preview page on its Web site.

It's too much, too soon. Such blatant desperation and commercialization undermines the holiday spirit and the excitement that is supposed to start stirring after a big Thanksgiving with friends and family.

As a harbinger of an economic recovery, the retail sector is not showing much confidence. It's another sign that despite investor optimism that pushed the Dow comfortably back above the 10K mark, consumer pessimism is proving harder to overcome.

Despite the slight reduction in new claims for unemployment benefits reported yesterday, there are just too many Americans out of work. The 10.2% jobless rate reported for October is a level we haven't seen in 26 years.

In this environment, discounters rule. But even low-price leaders such as Wal-Mart and Kohl's (Stock Quote: KSS) are finding it necessary to go even lower. Both stores indicated this week that they plan aggressive discounting over the holiday shopping season.

The price pressure and early start to the traditional Black Friday discounts suggests that retail margins will continue to erode. About the only good news is that we don't need to worry much about inflation.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Great Black Friday Prices Via Twitter & Facebook

The Associated Press — Fri, 13 Nov 2009 15:40:01 -0500

By Betsy Vereckey, AP Retail Writer

NEW YORK (AP) — You may want to check Facebook and Twitter before heading to the mall the day after Thanksgiving.

Office supplies chain Staples Inc. this week used social media to advertise price cuts of nearly 50% for Nov. 27 on certain laptops, GPS devices and computer monitors, and still other merchants are expected to follow suit.

Dan de Grandpre, editor-in-chief of dealnews.com, said retailers are smart to use social networking sites because shoppers probably will stick around as followers of the company even after the sale.

"Twitter and Facebook are now major ways to disseminate information," Grandpre said.

One in five shoppers plans to use the sites in their holiday shopping this season, according to Deloitte Research.

Hundreds of Black Friday bargains from retailers such as diverse as OfficeMax and Old Navy already are being leaked on deal sites, even though the big sales blitz is still a couple weeks away.

And the fun won't end Nov. 27, traditionally seen as the day that the holiday shopping season launches.

After that, an iPhone application from dealnews.com that now tracks Black Friday deals, for instance, will show sales for the following Monday, now known as Cyber Monday because it's the first weekday after the Thanksgiving weekend and many consumers shop from their desks that day.

States Face Budget Disasters

The Associated Press — Fri, 13 Nov 2009 15:00:00 -0500

By Judy Lin, Associated Press Writer

SACRAMENTO, Calif. (AP) — In Arizona, the budget has grown so gloomy that lawmakers are considering mortgaging Capitol buildings. In Michigan, state officials dealing with the nation's highest unemployment rate are slashing spending on schools and health care.

Drastic financial remedies are no longer limited to California, where a historic budget crisis earlier this year grew so bad that state agencies issued IOUs to pay bills.

A study released Wednesday warned that at least nine other big states are also barreling toward economic disaster, raising the likelihood of higher taxes, more government layoffs and deep cuts in services.

The report by the Pew Center on the States found that Arizona, Florida, Illinois, Michigan, Nevada, New Jersey, Oregon, Rhode Island and Wisconsin are also at grave risk. Double-digit budget gaps, rising unemployment, high foreclosure rates and built-in budget constraints are the key reasons.

"While California often takes the spotlight, other states are facing hardships just as daunting," said Susan Urahn, managing director of the Washington, D.C.-based center. "Decisions these states make as they try to navigate the recession will play a role in how quickly the entire nation recovers."

The analysis, "Beyond California: States in Fiscal Peril," urged lawmakers and governors in those states to take quick action to head off a wider catastrophe. The 10 states account for more than one-third of the nation's population and economic output, according to the report.

Historically, states have their worst tax revenue year soon after a national recession ends. At the same time, higher joblessness and underemployment mean more people need government-sponsored health care and social safety-net programs, further taxing state services.

California leads the most vulnerable states identified by the report, which describes it as having poor money-management practices. Since February, California has made nearly $60 billion in budget adjustments in the form of cuts to education and social service programs, temporary tax hikes, one-time gimmicks and stimulus spending, according to the Legislative Analyst's Office.

Many of those fixes are not expected to last. The state's temporary tax increases will begin to expire at the end of 2010, while federal stimulus spending will begin to run out a year after that.

Gov. Arnold Schwarzenegger estimates California will run a deficit of $12.4 billion to $14.4 billion when he releases his next spending plan in January. The governor warned that the toughest cuts are ahead.

"I think that we are not out of the woods yet," Schwarzenegger said this week.

At the same time, the Legislature is hamstrung by requirements that budget bills and tax increases be passed with a two-thirds majority, a mandate that the report labeled "a recipe for gridlock."

The Pew report was based on data available as of July 31 and scored all 50 states based on revenue changes, unemployment, foreclosures and budget requirements. It also gave them grades. California and Rhode Island scored worst with D-pluses, then New Jersey and Illinois with C-minuses.

In reviewing why some states are suffering more than others, Pew found that the 10 states tend to rely heavily on one type of industry, have a history of persistent budget shortfalls or face legal constraints making it extra difficult to implement major changes, such as tax increases.

Many require a supermajority vote for passing tax increases or budget bills.

Several state legislatures were unable to enact long-term fixes. Instead, they asked voters or governors to make the call, or used accounting gimmicks to put off the hard choices until later.

For example:

— Arizona lawmakers relied on one-time fixes to balance recent budgets as the state's home foreclosure rate surpassed California's and the nationwide average. Among the many ideas being explored by the state are a plan to mortgage state buildings, then rent the property until the state regains ownership at the end of the contract.

— Michigan, where two of the Detroit Three automakers filed for bankruptcy protection this year, continues to offer tax incentives even as they take a toll on the state's pocketbook, leading to declining tax revenue. According to the Pew study, Michigan offered $6.3 billion more in total tax exemptions, credits and deductions than it actually collected in taxes in 2008.

— Illinois, which has run deficits every year since 2001, is facing an $11.7 billion budget gap for its next fiscal year, beginning in July, according to the Center on Budget and Policy Priorities. Pew's Government Performance Project ranked Illinois behind only California and Rhode Island for its lack of fiscal management on paying medical bills and pension liabilities.

— With Florida facing a shrinking population for the first time since World War II, Republican Gov. Charlie Crist and the GOP-controlled Legislature balanced a $5.9 billion shortfall with cuts, federal stimulus money and tax hikes, including a $1-a-pack tax increase on cigarettes. But the future remains uncertain.

"Florida continues to face the same challenges as last year, including a very austere budgetary environment," said Rep. David Rivera, a Miami Republican who chairs both of the Florida House's two appropriations councils.

___

Associated Press writers Bill Kaczor in Tallahassee, Fla., and Paul Davenport in Phoenix contributed to this report.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

A New Way to Fight Foreclosures

Brian O'Connell — Fri, 13 Nov 2009 13:06:27 -0500

Two legal decisions – one in a New York State Court and one in a Tampa, Fla. foreclosure court – to cancel a homeowner’s mortgage debt after the bank couldn’t find the mortgage paperwork, are sending shivers down the spine of mortgage lenders.

In September, a New York resident facing foreclosure requested a copy of the deed on his home. When the mortgage provider, PHH Mortgage, couldn’t come across with the paperwork, a bankruptcy judge waived the homeowner’s entire mortgage debt. The amount waived? $461,263.

Also this fall, a Florida foreclosure court ruled in favor of a jobless (and about to be homeless) Tampa-area woman who filed a request for her original mortgage paperwork. Using free court documents to make her request, the woman found, no doubt to her delight, that the mortgage carrier didn’t have the deed. Just like that, the foreclosure judge put a freeze on the proceedings and threatened to cancel the entire debt if the paperwork wasn’t delivered to court.

Are these stories anecdotal? Or do they signify a trend that could release millions of homeowners from foreclosure – and, like the New York homeowners, have their mortgage debt canceled entirely?

The data might surprise you. A 2008 University of Iowa study concludes that mortgage companies have a nasty habit of misplacing key mortgage documents. In the study, Iowa researchers reviewed 1,700 bank foreclosure cases and discovered that 40% of the time, the original home note was nowhere to be found.

There’s a legal precedent, too. In 2007, a federal judge in Cleveland tossed out 14 foreclosure cases when the lender, Deutsche Bank National Trust, couldn’t find the original paperwork.

So how can anxious homeowners take a crack at the missing paperwork gambit? It’s not easy, there are no guarantees, and you’ll likely need a good real estate lawyer.

But why not take a look? Start with the Consumer Warning Network Web site – that’s the site the Tampa woman used to save her home (for now) from foreclosure.

The site has free legal templates for key steps like firing off a letter to your lender or issuing a “motion to compel” to get a court to toss out a foreclosure case.

If you’re already fighting a foreclosure notice, you’ll need to get organized fast. The Consumer Warning Network Web site advocates taking these steps (directly from the group's site).

If your lender has already filed suit to foreclose on your home:

File a “legal request” form in court (the CWN has a sample one on its site). It’s a fill-in-the-blank legal request to your lender asking that the original note be produced, before it can proceed with the foreclosure. In some jurisdictions, the courts require the original request to be filed with the clerk of court and a copy of the request to be sent to the attorney representing the lender. To find out the rules where you live, call the Clerk of Court in your jurisdiction.
If the lender’s attorney does not respond within 30 days, file a motion to compel with the court and request that the court set a hearing on your motion. That, in effect, asks the judge to order the lender to produce the documents.
The judge will issue a ruling at your hearing. Many judges around the country are becoming more sympathetic to homeowners, because of the prevalence of predatory lending and servicing. In the past, many lenders have relied upon using lost note affidavits, but in many cases, that’s no longer enough to satisfy the judge. They are holding the lender to the letter of the law, requiring them to produce evidence that they are the true owners of the note.

If you are in default, but your lender has not yet filed suit against you:

File a legal request form to get the original paperwork. If the lender does not respond and files suit against you to foreclose, follow the steps above.
What have you got to lose? If your home is already in foreclosure proceedings, or you are in default and headed in that direction, take a shot at getting the original paperwork.

That shot might be a long shot, but it’s one more potential weapon in protecting your home.

Wal-Mart vs. Target: The Bargain Face Off

Seth Fiegerman — Fri, 13 Nov 2009 13:00:00 -0500

As we reported last week, many retailers ramped up their Black Friday deals nearly a month in advance in an attempt to attract more Americans weary about spending money in this economic climate.

But two companies seem to be in a head-to-head death match to win the day: Target (Stock Quote: TGT) and Wal-Mart (Stock Quote: WMT).

Target has a full arsenal of bargain goods. They announced an HDTV for $246 and are planning a fair share of gift card opportunities as well (though they are only worth $10). On top of that, Target just leaked its ace in the hole, $3 kitchen appliances. The retail store will offer items like coffee makers, sandwich makers and toasters for 300 pennies each.

Target may have a bit of an uphill battle, though, as most customers still have the perception that Wal-Mart is the cheaper store, despite the fact that a recent analysis of goods offered showed Target actually costs a little less.

Wal-Mart has already announced its fair share of incredible Black Friday deals this year. Wal-Mart is holding weekly shopping events leading up to the holidays. They have already offered bargain priced HDTV’s and laptops. Now, they’ve announced that customers who buy any of these cell phones from tomorrow through November 20 will get a $100 gift card.

Plus, Wal-Mart is planning to extend its holiday hours, staying open from 6am on Thanksgiving through the night and all of the next day.

We’re excited to see what else these two retail giants pull out in anticipation of the biggest sales day of the year. If this is a battle, it’s one that can only benefit consumers.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

5 Dumbest Things on Wall Street: Nov. 13

Gregg Greenberg — Fri, 13 Nov 2009 12:00:00 -0500

Irregular Regulators

NEW YORK (TheStreet) -- We've seen plenty of hostile corporate takeovers over the years. But the escalating battle between international regulators over the pending Oracle-Sun Microsystems deal is a new twist even for us.

The European Commission, which formally objected to the $7.4 billion merger on the grounds that it could hurt competition in the database market, called out the U.S. Justice Department Tuesday. The cause of EC's displeasure was a curious statement by the U.S. regulator reaffirming its August decision to allow the merger.

"We remain hopeful that the parties and the EC will reach a speedy resolution that benefits consumers in the commission's jurisdiction," Molly Boast, deputy assistant attorney general for the Justice Department's antitrust division, said in a statement Monday.

Miffed that the Justice Department was pressing for the merger while the ball was still in their court, EC spokesman Jonathan Todd brusquely responded Tuesday by calling the American statement "unusual."

"I cannot recall any instance where the European Commission has ever issued a statement concerning ongoing investigations in another jurisdiction," said Todd, adding, "We have our methods, they have theirs."

Good golly, Miss Molly, we have a good, old-fashioned bureaucratic brouhaha brewing.

Of course, this isn't the first time the two regulators issued different decisions on a merger case. In 2000, U.S. authorities approved General Electric's takeover of Honeywell, but the EC stepped in to block it the following year on antitrust grounds.

Nevertheless, the economic climate is very different this time around. The chips are down and even regulators know that it's every nation for itself.

And that means that even fellow trust-busters can't be trusted.

Dumb-o-meter score: 95 -- It's like going to a hockey game and seeing a fight break out -- among the referees. Pinnacle's

Pin-Head CEO

Pinnacle Entertainment says its CEO resigned "to pursue other business interests." We think his big mouth got him thrown out of the casino.

Daniel Lee stepped down as the gaming company's CEO and chairman Monday, barely a week after he allegedly confronted a St. Louis County Council member who voted in favor of a rival company's expansion plans. The Missouri State Highway Patrol, which performs investigations for the Missouri Gaming Commission, said it is looking into Lee's actions. Pinnacle owns two casinos in downtown St. Louis and is developing a third in St. Louis County to open next year.

Las Vegas-based Pinnacle said Richard Goeglein will be interim chairman and John Giovenco interim CEO. Both are currently on its board. Hopefully, each can control his emotions better than Lee.

According to The Associated Press Lee reportedly asked County Council member Steve Stenger to vote against a zoning issue for a casino being developed in the county by a competitor. Stenger voted in favor of it, however, sending Lee through the roof. The casino big-wig approached the council platform -- while the meeting was still in session mind you -- and told Stenger's assistant that her boss made a grave error and that he wouldn't forget the councilman's betrayal.

"It's one thing to come in and ask for something," Stenger said Monday. "It's another to come in and pressure someone and then make threats when you don't get what you want."

And performance has been left wanting of late at Pinnacle, which may have contributed to Lee losing it in public. The casino operator lost $21.9 million in its fiscal third quarter, compared with a loss of $11.8 million a year earlier.

You would think by now Lee would know how to take a loss in stride. It doesn't take a casino CEO to know that you won't be playing very long if you insult the dealer.

Dumb-o-meter score: 90 -- He used to be the pit boss, now he's the pits.

Disney's Christmas Jeer

Boy that Mickey Mouse can be a real Scrooge when things don't go his way.

Mark Zoradi, president of Walt Disney Studios Motion Pictures Group and the head of worldwide marketing for all Disney, Pixar, Touchstone and Disney nature movies, announced Monday he is stepping down immediately in the wake of a weak opening for the costly holiday movie, "A Christmas Carol." The 3-D remake of the classic Christmas tale, which cost $175 million and stars Jim Carrey, opened to a pitiful $30.1 million at the weekend box office in the U.S. and Canada and is expected to lose up to $100 million.

If only the ghost of Disney past could go back in time and stop whoever greenlighted that bomb, then maybe Zoradi would still have a job.

It's worth noting that Zoradi is not the only Disney movie executive sent to the sidelines this season. In fact, the Mouse House has been more like a rat trap for studio chiefs lately.

Last month, Disney named Rich Ross as chairman of its movie studios, replacing the popular Dick Cook, who oversaw a string of bombs. And Daniel Battsek, who ran Disney's low-budget Miramax Films, left in October after the company slashed the unit's workforce and cut the number of films it would release.

In all, Disney's studio revenue has fallen in each of the last five quarters, sinking from $1.82 billion in the March quarter of 2008 to $1.26 billion in the quarter ended in June this year. The studio also posted a $12 million operating loss in the June quarter, down from a $97 million operating profit last year.

Disney is counting on its latest addition, Marvel Entertainment, to lift its fortunes with a blockbuster or two. However, if Spider-Man can't use his spidey sense to pick some winners, he may be the next one out the door.

Dumb-o-meter score: 85 -- Disney to Zoradi: "Bah, Humbug!"

Goldman's Divine Inspiration

Wall Street may be a fertile ground for stupidity, but there are still times when we here at the Five Dumbest Lab struggle to find stories worthy of our list. If only we had a batphone to God like Goldman Sachs CEO Lloyd Blankfein, it sure would make our lives much easier.

The CEO of the gold-standard investment bank discussed his divine partnership in an interview with London's Sunday Times newspaper, saying his flock of bankers and traders are doing "God's work."

"We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. We have a social purpose," sayeth Blankfein unto the Times.

Oh, so that's why the Apostle Paulson -- praised be Hank -- saved his former firm from going under last year instead of those unbelievers at Lehman Brothers. It's because Goldman helps other companies be fruitful and multiply.

And while we were looking for a burning bush to show us the way, Blankfein opened our eyes to the real sign that the world economy was recovering. He said that bountiful bank profits and bonuses, like Goldman's $3 billion third-quarter earnings and $20 billion bonus pool, are the real indicators of heavenly times ahead.

"Others made no money and still paid large bonuses. Some are not around anymore. I wonder why?" asketh Blankfein.

We don't know, Lloyd. Why don't you call your boss? Surely He knows.

Dumb-o-meter score: 80 -- Brother Lloyd needs to take a vow of silence.

Benmosche the Brave

In the end, Bennie decided not to jet.

American International Group CEO Robert Benmosche said Wednesday he plans to remain in his job at the besieged insurer. Benmosche reaffirmed his commitment to the company in a letter to employees after a report in The Wall Street Journal claimed he was close to quitting. The Journal said Benmosche was fed up with government meddling and heavy restrictions on executive pay resulting from the $180 billion in bailout funds the company took from Uncle Sam last year in return for an 80% stake.

Benmosche said in his letter that while he was aggravated by the regulatory oversight, he and the board of directors "remain totally committed to leading AIG through its challenges and to continuing to fight on your behalf."

Wow, now that is a stand up guy! He is a man of such principle and character that he would rather quit after three months on the job than listen to his bosses in Washington. Take heed all you salary-capped AIG employees, because you truly have a special leader worth emulating now. If he can threaten to quit, you can too!

Of course, unlike many of his employees, Benmosche doesn't need the job or the headache, so he can threaten to jump ship and follow through. It's well known he could hang it up in a heartbeat and live quite cozily on the money he made at his last gig running Metlife.

But no. Benmosche is going to be a martyr. He's going to stick around and turn this ship around, or sell it off piece by piece, whichever comes first. And while he does that he's going to collect that entire $10.5 million pay package, which was approved by pay czar Ken Feinberg. The top 25 highest-paid AIG executives, on the other hand, will be limited in most cases to $500,000 according to the government's plan.

Now that's what we call sacrifice.

Dumb-o-meter score: 75 -- Benmosche could easily solve his compensation problem by sharing some of his own. There's plenty of it to go around.

Incubators Make Small Biz Growth Easy

Sharon McLoone — Fri, 13 Nov 2009 11:00:26 -0500

Incubators are a great resource for small business owners to cultivate and grow their firms.

Also referred to as “innovation centers,” incubators are often affiliated with a university or county economic development office. They house groups of growth companies, usually technology-centric, that can learn from each other while sharing resources provided by the incubator staff.

They’re generally funded by money from universities and municipal governments. States and counties like them because companies that grow in an incubator ultimately set up shop in an area nearby, giving the municipality a good return on its investment by boosting the neighborhood’s economic base, according to the National Business Incubation Association.

“An incubator is a great economic development tool to seed companies in a certain economic sector into your economy,” says Sally Sternbach, executive director for Rockville Economic Development in Rockville, Md. About 85% of firms housed in an incubator survive five years or more, she says. In Sternbach's county (Montgomery), the rate is 92%.

She says small business owners who currently work out of their homes but are ready to make a move to a more professional setting are good candidates for an incubator.

But for those entrepreneurs who do better work in a garage, an incubator wouldn't be a good fit. “You need to know if you’re coachable,” says Tom O’Neal, director of the University of Central Florida’s Technology Incubator in Orlando. “You don’t need to go to an incubator if you’re just looking for an address because people there are going to try and tell you and teach you things.”

But if you’re ready to make the move because you’re having more meetings or the kids and dog are providing too many distractions, an incubator might be right for you. “You’re getting to a point when you’re making a lot of brand new decisions and want to be around other people, digesting their experiences,” says Sternbach.

Before you make the move, make sure you have enough revenue to cover six months of leasing incubator office space, advises Sternbach. Rent at an incubator is about on par with the square footage costs of traditional office space, but offers other amenities at no extra charge.

Incubators began getting popular about 10 years ago, says Elaine Amir, the executive director of Johns Hopkins University, which is also in Montgomery County, and houses an incubator. She prefers to call it an “innovation center.”

Incubators initially were largely groups of biotechnology firms, she says. However, they have expanded to include other industries because for many small business owners “it’s a very different thing to be a scientist or an innovator and discover that process than it is to take it to market,” says Amir.

But incubators still trend toward tech firms. Retail is hard to do in a incubator because you “can’t really run a retail space out of an incubator” points out O’Neal. There are often themed incubators for biotech firms, information technology firms or there’s even an art incubator in Kansas City, Mo. “Most lifestyle firms like dry cleaners, pool cleaners can get the kind of help they need from working with a Small Business Development Center,” he says.

Incubator benefits:

Professional Look. An incubator offers conference space and provides a more professional environment for visits. “It also gives you an address that looks decent,” notes Sternbach.

Administrative Help. Incubators generally provide a receptionist and business basics like a copier, fax machine or dishwasher. “If you’re doing work and it’s timed and tedious the fact that you have to answer the telephone could knock out your experiment,” says Amir.

Get Through Startup Phase. Fledgling tech firms often take a while to get their services or product to reach the marketplace, says Amir. “When a business is not really operational and needs a support system, it’s probably a good fit for an incubator.”

Build an Existing Business. While most firms are fairly young when they enter an incubator, O’Neal says he’s seen 10-year-old firms join to jumpstart their businesses.

Business Planning. The University of Central Florida’s Technology Incubator requires any company applying for residency to complete a 21-hour course over 3 ½ weeks that includes making a business plan. There is an application process to enter any incubator and not just anyone is accepted.

Resource Center. Incubators often bring in experts by holding weekly or monthly seminars to educate tenants on legal issues like intellectual property concerns, marketing, fundraising, writing a business plan and other aspects of running a successful business.

Library Access. Most businesses housed in a university-affiliated incubator will have free access or for a nominal fee to the school’s library along with periodicals and other guides that can be expensive to subscribe to on your own. “We’ve also had innovation center companies work with the librarian to help them set up their own libraries when it’s time to move out,” says Amir.

Graduation

Firms are encouraged to graduate from an incubator once they have a steady revenue stream and are ready to take the commercial office space plunge. In Rockville’s program, a business can leave at any time with two months’ notice.

“Usually a company’s rent is increased 5% every year as sort of a nudge to encourage firms to move out so that others can move in,” says Sternbach. The incubator experts have seen companies stick around for six months to five years or more, but most are out in about three years.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

March 2010: D-Day For Low Mortgage Rates?

Brian O'Connell — Fri, 13 Nov 2009 10:17:20 -0500

The Federal Reserve doesn’t “do” deadlines, preferring to shape policy much like the Colorado River shaped the Grand Canyon – gradually, but inexorably, over time.

But signals from the Fed indicate that patience is wearing thin at the economic policy board, with some economists maintaining that the Fed must take the training wheels off and give the economy a chance to grow on its own. A big part of that strategy is encouraging private investors to jump back into the mortgage market – with or without a net from Uncle Sam.

It’s the latter point we’re interested in today. Recently, the Federal Reserve announced it will cease its mortgage security buyback program next March – a program that helped keep interest rates artificially low for much of 2009. That should change the rate picture by Spring 2010, most likely bringing interest rates upward.

It takes some tea-leaf reading, but that seems to be the consensus, based on the Fed’s own actions, directives and language used in recent public policy statements. For example, here are the minutes from last week’s Federal Reserve meeting, where the policy-making committee decided to keep the benchmark Federal Funds rate between 0% and .25% – for now – but phase out the mortgage security purchase program by Spring 2010.

“To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. The amount of agency debt purchases, while somewhat less than the previously announced maximum of $200 billion, is consistent with the recent path of purchases and reflects the limited availability of agency debt. In order to promote a smooth transition in markets, the Committee will gradually slow the pace of its purchases of both agency debt and agency mortgage-backed securities and anticipates that these transactions will be executed by the end of the first quarter of 2010.”

So there, in Federal Reserve-speak, you have it. The closest thing to a deadline you’re going to see – a March target to stop buying back mortgage-backed securities, which should trigger an almost immediate uptick in mortgage rates.

Here’s why. The end of the buyback program is only one of the weapons that the Fed can use to influence the economy. The others? Option #1 is usually an attempt to drain the excess reserves from the U.S. banking system. Option #3 is raising the Fed funds rate, a move that the Federal Reserve seems reluctant to do.

Right in the middle is the mortgage-backed security purchase program. That program represented $1.25 trillion of much-needed cash into the mortgage-backed security market.

To the average mortgage consumer, the program was a roaring success. With the Federal Reserve spending tens of billions of dollars monthly on mortgage securities that private investors likely wouldn’t have bought, interest rates were kept low, at between 5% and 5.25% for much of 2009.

But if the Fed follows through on its promise to close the program down, and lean on the private sector to pick up the slack, that could well leave a huge hole in the mortgage-backed securities marketplace. If the economy doesn’t cooperate, and sends private investors into the mortgage marketplace to plug the gap (a good bet right now), then look for interest rates to rise next March.

The Fed may not do deadlines, but it’s not above firing a warning shot to the American consumer. If you want to buy a home, do it in the next three or four months. After all, the difference in monthly mortgage payments of 5% or 6% can be measured in tens of thousands of dollars over the life of the loan.

So beware the Ides of March. After that, all bets are off.

Fed: Banks Need Consent on Overdraft Fees

The Associated Press — Fri, 13 Nov 2009 09:45:00 -0500

By Christopher S. Rugaber, AP Economics Writer

WASHINGTON (AP) — Banks will have to secure their customers' consent before charging large overdraft fees on ATM and debit card transactions, according to a new rule announced Thursday by the Federal Reserve.

The rule responds to complaints from consumer groups, members of Congress and other regulators that the overdraft fees are unfair because many people assume they can't spend more on a debit card than is available in their account. Instead, many banks allow the transactions to go through, then charge fees of up to $25 to $35.

For small purchases, such as a cup of coffee, the penalty can far exceed the actual cost of the transaction.

Under the Fed's new rule, which will take effect July 1, banks will be required to notify new and existing customers of their overdraft services and give customers the option of being covered. If customers don't "opt in," any debit or ATM transactions that overdraw their accounts will be denied, Fed officials said.

Many consumers do want checks and regular electronic bill payments to be covered in the event of an overdraft, Fed officials said. As a result, those transactions aren't covered by the rule.

Banks earn as much as $25 billion to $38 billion annually from overdraft fees, Fed officials said, but that total includes check overdrafts.

Many larger banks, including Bank of America Corp., JPMorgan Chase & Co., U.S. Bank and Wells Fargo & Co. began instituting similar "opt-in" plans in late September after coming under fire for the fees.

But consumer groups and other regulators, including Federal Deposit Insurance Corp. Chairman Sheila Bair, said new rules were still necessary to ensure smaller banks followed suit.

Many lawmakers have criticized the Fed for failing to provide sufficient consumer protection in the past, a defect they say contributed to last year's financial crisis. Sen. Christopher J. Dodd, D-Conn., on Tuesday introduced a bill that would strip the Fed of its consumer oversight.

Dodd also proposed legislation last month that would have imposed limits similar to the Fed's on the banks' ability to charge overdraft fees.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Coping With Bad College-Savings Results

Jeff Brown — Fri, 13 Nov 2009 09:00:00 -0500

You say you’re unhappy with your 529 college savings plan? You’re not alone.

Many investors are disgusted with the big losses their plans suffered, and industry data shows substantially less money flowing into these plans this year compared to two or three years ago.

But before you throw in the towel and move out of 529s altogether, take a reality check. Your 529 plan may not be as bad as you think, and the alternative may be no better.

The chief benefit is still there. That’s the tax-free treatment of investment gains withdrawn for higher-education expenses. Granted, that’s not too valuable if your account has losses rather than gains, especially if your child will start college in the next few years.

But if you’ve had the account for a number of years, or have five years or more before college expenses begin, investment gains could still be big enough to make tax-free treatment valuable.

Of course, if you have suffered losses, pulling your money out could be painless. You must pay tax and a 10% penalty on withdrawals that are not used for college or graduate school, but tax and penalty apply only to investment gains, not your original deposit.

Among the most disgusted groups of 529 investors are those who selected age-based funds that emphasize stocks when the child is young and gradually shift to bonds as the college years get close.

The brokerages and mutual fund firms that provide 529s can be faulted for not explaining more clearly that age-based funds do contain plenty of risk. Even if the target date is very close, many of these funds keep some assets in stocks, hoping to provide inflation-beating growth in case the funds aren’t tapped until the tail end of the child’s college or graduate school years. Some age-based funds went overboard, keeping more than half the assets in stocks even after the college starting date had arrived.

But the fact is that the market meltdown of 2008 was extraordinary, and torpedoed many types of bonds as well as stocks. About the only way to avoid losses would have been to invest in cash, and that would have ensured that an account’s growth would not keep pace with rising college costs, let alone exceed them.

The typical age-based 529 did no worse than the market as a whole.

Still, an unhappy investor has every right to explore alternatives. The first is to shift the account to a different 529, with the same firm or another. Your plan provider can tell you how.

Another option is to get out of the age-based fund and put some of the money into a stock-only 529 and the rest into one that specializes in bonds. That will give you more control over risks, though you’ll have to change the asset mix yourself as the child gets older.

Pulling out of your 529 in favor of a taxable investment could backfire if you have to pay tax and penalty on the withdrawal and then face tax on investment gains in the new account.

If you do look for new funds, keep a close eye on fees. The less you pay the better. Some 529s use index-style funds with rock-bottom fees. Morningstar Inc. (Stock Quote: MORN) has produced a list of funds it considers best. Also look at this list of top-performing plans compiled by SavingforCollege.com, a site full of useful 529 information. Note that Charles Schwab (Stock Quote: SCHW) is at or near the top in one-, three- and five-year categories.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Escaping Family During the Holidays

David Seaman — Fri, 13 Nov 2009 07:00:00 -0500

Sure you love them (maybe) but extended family can get on your nerves after a while—here’s what to do with them this holiday season.

Green Jobs that Pay Big Bucks

Seth Fiegerman — Fri, 13 Nov 2009 07:00:00 -0500

Make some serious green with these environmental jobs.

Save Cash With Retro Toys

Michael Schreiber — Fri, 13 Nov 2009 07:00:00 -0500

And you thought Capsela would never make a comeback.

Underwear Spending May Surprise

David Seaman — Thu, 12 Nov 2009 15:45:00 -0500

As reported by WalletPop, a British retailer’s study of male shoppers’ underwear buying habits yielded some unusual results.

Among them, the fact that “male shoppers don't buy their own underwear until they reach the ripe old age of 19.” Before that most crucial rite of passage, Mum buys the underwear. Really.

Also: “At 19, young men go on a boxer-and-brief buying binge, buying up to 31 pairs a year for the next four years of their life.” By age 23, underwear acquisitions taper off sharply, picking up again between the ages of 38 and 40.

According to the study results, this weird fluctuation in purchasing habits is explained by the motivation to “lure a potential mate.” (Around age 38, for example, underwear buys increase since “men who have been through a divorce [are] getting back in the dating game”—and they need to be armed with impressive underwear to do that, apparently).

As a guy, I don’t quite know what to make of this study: I’ve been buying my own skivvies for a while now, and as far as I can tell my purchasing patterns don’t correlate to any relationships. But at least I now have some solid ammo for the next time a female friend swoons unnecessarily over a British guy. “I’ve heard his mom buys his boxers,” I’ll tell her, shaking my head somberly. “It’s science.”

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Getting the Most Miles Out of a Car

The Associated Press — Thu, 12 Nov 2009 15:00:00 -0500

By Tom Krisher, AP Auto Writer

DETROIT (AP) — More people are keeping their cars longer for fear of going into debt or losing their jobs.

R.L. Polk & Co., an auto industry data analysis firm, says the median age of the American ride rose to a record 9.4 years in 2008.
If you do decide to stretch out the life of your car, here are some things to consider.

Just how long you can or should keep your vehicle varies with the make, model and the care put into it during its life, says Thomas Sewell, owner of Sewell Auto Care in Canton, Ga.

The Detroit Three, General Motors, Chrysler and Ford, are battling the perception that their cars don't last as long as those made by Japanese automakers, mainly Honda and Toyota. Although the Detroit brands have improved, many mechanics believe that you have a better chance of racking up miles on a Japanese car without too much trouble.

"The Japanese have a good head start on them, unfortunately for the domestics' sales," says Danny Beiler, part owner of an auto repair garage in Sarasota, Fla.

Sewell has seen owners extend the life of their car well over 300,000 miles with little trouble. But as vehicles age, the risk of a costly repair increases.

Automatic transmissions can fail after 150,000 miles. Manual transmissions will need clutches earlier, although a replacement clutch is far less expensive than a new or rebuilt transmission.

Engines also can fail, costing $3,000 or $4,000, says Sewell. When you face a costly repair on a high-mileage car, it's best to decide with your mechanic whether it's worth it.

"You reach a point where you have to weigh the options," says Sewell.

Here are four tips to help you make your ride last longer and avoid the pitfalls of pouring money into an old car.

1. Watch the fluids. Oil, antifreeze, transmission and brake fluids are the lifeblood of your car. Check frequently as your car ages. Some mechanics recommend checking every time you fill up with gasoline. If fluid levels drop too low, it can cause long-term damage to your engine.

2. Look for spots. If you have an oil or other fluid leak, you'll likely see small spots on the pavement beneath the hood. If you see a spot, check the fluids to make sure they're at the right levels. If the spots persist, get the car to a mechanic.

"You should definitely get it looked at before it turns into something bigger," says Sewell.

3. Follow the manufacturer's maintenance schedule. Michael Tschetter of Parker, Colo., has three cars with more than 150,000 miles on them and plans to keep two of them for several more years.

He says the recommended maintenance of changing belts, flushing fluids, replacing filters and swapping out spark plugs can be expensive, but it will cost you more to put it off.

Tschetter said he put $2,500 into his 2000 Honda Accord when it crossed 100,000 miles, even though it had no apparent problems. The investment, he says, has paid off. His car now has 153,000 miles and "runs like the day you drove it off the lot."

4. Work with a trustworthy mechanic. Visiting a reliable mechanic for things like fluid checks helps in many ways. The more a good mechanic sees your car, the more likely they are to catch small problems before they become big.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Reverse Mortgage Scammers on the Loose

Brian O'Connell — Thu, 12 Nov 2009 13:15:09 -0500

Uh-oh, you knew this was coming.

With more and more seniors looking into the reverse mortgage market, a new report warns that some of the most notorious players in the sub-prime world have moved over to the reverse mortgage market — and are setting up shop. Here’s what to look for so you don’t get fleeced.

First, what is a reverse mortgage? Essentially, it’s a loan on home equity, where a lender makes regular tax-free payments to the homeowner for life. In return, the lender takes ownership of the property after the homeowner’s death, or when the homeowner sells the home.

At face value, reverse mortgages can be attractive. For example, homeowners can opt to receive their cash via fixed monthly payment, lump sum or by line of credit. Plus, there is no income requirement and homeowners still retain the titles to their homes.

On the downside, reverse mortgages could impact a homeowner’s Medicaid eligibility, and can generate ample origination and management fees that must be paid by the homeowner. In addition, like most loans, reverse mortgages charge interest, which can increase debt loads over time. More so, the deeper into a reverse mortgage you go, the less money you’ll have to leave to your heirs.

No matter what the pros and cons, it’s full-speed ahead for reverse mortgage marketers. The report, which comes from the National Consumer Law Center, contends that reverse mortgage outfits are getting more aggressive — and growing more emboldened — as they target seniors and their hard-won home equity.

The report, titled Subprime Revisited: How the Rise of the Reverse Mortgage Lending Industry Puts Older Homeowners at Risk says that annual reverse mortgage volume has exceeded 110,000 U.S. homes, with a total value of about $17 billion. A slew of big banks are involved in the reverse mortgage market, including mainstays like Wells Fargo (stock quote: WFC) and Bank of America (Stock Quote: BAC). Big insurance companies, like Metlife (Stock Quote: MET), are treading into the marketplace, as well.

The NCLC isn’t shy about pointing fingers at big financial institutions, noting that reverse mortgage campaigns are slick, well-funded efforts that could gloss over the ramifications of entering into a reverse mortgage agreement. The report also cites “perverse incentives” to financial services brokers who are on the front lines in reaching out to seniors and extolling the virtues of a reverse mortgage.

This from the report: “Many of the same players that fueled the subprime mortgage boom — ultimately with disastrous consequences — have turned their attention to the reverse market. Lenders, including some of the nation’s largest banks, view that market as a source of profits that have dried up elsewhere. Mortgage brokers see it as a new source of rich fees. Predators who once reaped profits from exotic loans have now focused on wresting more wealth from vulnerable seniors. And securitization, which allowed subprime loan originators to disassociate themselves from the downside risks of abusive lending, is becoming commonplace in the reverse mortgage industry.”

The report, which notes there are no FDIC insurance, nor significant federal regulations protecting consumers from reverse mortgages, urges stronger federal bulwarks against unscrupulous companies and calls for a “suitability” standard that reverse mortgage marketers must adhere to. Counseling services to unwary seniors are also urged. Financial watchdogs have long held that companies which pry open seniors' home equity via reverse mortgages unfairly profit by getting homeowners to buy high-commission annuities or unnecessary insurance policies.

Those are all good reasons why the NCLC report is worth reviewing. Download it here and read the whole thing. The home you save may be your parent’s or grandparents — or maybe even your own.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Free Concerts from Your Home

Seth Fiegerman — Thu, 12 Nov 2009 12:30:00 -0500

Tired of coming home after a concert smelling of cigarette smoke and battling that ringing sound in your ears from standing too close to the amplifiers?

Well, now you can watch concerts from the comfort of your own home. And best of all, it’s free.

Billboard.com recently announced that it is launching a new Web site that will broadcast concerts from popular acts for free. The site, called BillboardLive.com, will feature Webcasts from big name acts like Usher and Alicia Keys. The site will kickoff by streaming a live concert from the band Daughtry next week. An R. Kelly concert will follow later in the month.

Users will have the option to view the concert from five different camera angles. No more straining your neck over the freakishly tall couple in front of you to catch a glimpse of the singer’s arm 200 feet away.

Best of all, the concert will be available on the iPhone, so you can cool down during your lunch hour and watch a concert at work.

So hold your Bic lighter (or your iPhone lighter app) up to the screen and sing along.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Are Americans Ignoring Their Finances?

Paul Ballew — Thu, 12 Nov 2009 12:00:00 -0500

BOSTON (TheStreet) -- U.S. households took a huge financial hit over the past year. Their net worth sank by $12 trillion from the peak. How can Americans rebuild their wealth, and how will financial advisers aid them?

Boston College's Center for Retirement Research recently released an update to the National Retirement Risk Index. (For the sake of full disclosure, my employer, Nationwide Mutual Insurance Co. underwrites the index research.) It quantifies the impact of the downturn on households' readiness for retirement. The new index shows that 51% of Americans aren't prepared to retire at age 65, compared with 44% in 2007.

The stock-market decline and recession underscore that we, as a society, are ill-equipped for retirement. While the results of the index update don't surprise us, some other critical developments regarding consumer attitudes are more troubling.

Our most recent research at Nationwide shows that the number of households with investable assets who have become disengaged from actively managing their retirement savings has jumped by a third. That means roughly half of all households who have money to invest can be classified as disengaged.

Simply stated, many more households have stopped doing the things they were doing to be prepared for retirement because of the downturn. We saw significant drops in those who say they seek financial advice, worry about their nest egg or are actively trying to boost their portfolios. That's disturbing, given the magnitude of the challenges we all face in rebuilding our portfolio.

Some of the increased disengagement stems from distrust of financial institutions, some of it from not knowing where to turn in a period of historic turbulence and yet more reflects a flight to safety, including the return to simple savings products.

Whatever the reasons, there are several implications for financial-services providers. These emerging attitudes pose a challenge and an opportunity.

Personal-savings rates are going to have to stay at levels that are double (maybe triple) those of the past decade. This increased savings is going to have to be augmented by good financial advice and counsel to help households repair their balance sheets. An asset allocation that is excessively conservative will complicate the repairing of balance sheets and could result in the shortfall persisting well into the next decade. Financial institutions and advisers are going to have to proactively address the concerns of households and help them find the appropriate investment strategy.

While the economy is recovering, cavalier attitudes that all consumers will automatically return with the market probably underestimates the lingering impact of the downturn.

— Written by Paul Ballew of Nationwide Mutual Insurance in Columbus, Ohio.

— For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

The 3 Easiest Banking Fees to Avoid

Miranda Marquit — Thu, 12 Nov 2009 11:00:00 -0500

Financial institutions make a killing off of fees. Whether it’s overdraft charges from the local bank or load fees charged by mutual funds, what you pay in fees can drain your finances and eat into your disposable income. Here are three avoidable fees that you might be paying:

Overdraft Fees

Overdraft fees are the granddaddy of them all. Earlier this year, CNN Money reported that banks are expected to collect $38.5 billion in overdraft fees. You can avoid overdraft fees by keeping track of your spending, especially when you use a debit card. This way, you are aware of how much you have, and you can keep a cushion in your checking account.

It can also help to link other accounts to your checking account. Some banks will let you link savings accounts, credit card accounts and additionally checking accounts to initiate automatic transfers that prevent overdraft. It's important to realize that “overdraft protection” usually comes with an annual fee and a relatively high interest rate.

Interest Charges

Credit card interest rates are notoriously high. You might be paying more than you imagine when you carry a balance. In order to avoid paying interest charges, you should be careful not to charge very much on your credit cards, and to pay them off every month.

You can get cheaper interest rates on auto loans and mortgages if you use credit responsibly and do your best to keep a good credit score.

Mutual Fund Fees

Mutual funds are famous for charging load fees, administrative fees and transaction fees related to turnover. Look for no-load mutual funds, and watch for funds that add loads to the back end. Additionally, you can save money in administrative fees by choosing index funds with low turnover.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Gift Card Discounts to Drool Over

Brian O'Connell — Thu, 12 Nov 2009 10:29:12 -0500

What do Americans want for Christmas this year?

Cards. Specifically, gift cards. A recent survey from the National Retailers Federation reported that sales of gift cards in the U.S. reached $25 billion in 2008 — much more than any other single gift during the last holiday season. Overall, 55.2% of U.S. adults want a gift card under the tree this year.

What’s more, the NRF estimates gift card sales to be higher this year than last — despite a crushing worldwide recession.

What deals can American consumers expect, specifically, from gift card retailers this year? Let’s see who’s been naughty and who’s been nice when it comes to good gift card deals:

Revenge of the big boxes: Big box retailers like Costco (Stock Quote: COST) offer a lot more than just pallets of toilet paper, as appealing as that sounds. Costco members can pick up a $90 iTunes gift card for just $75 this holiday season. Or for the culinary-inclined, $100 Wolfgang Puck gift cards are going for $80 at Costco.
Kohl’s in your stocking: Retail giant Kohl’s (Stock Quote: KSS) is offering Kohl’s Cash for every $50 spent in store or online. And starting this year, Kohl’s gift card kiosks will also offer a box of Godiva chocolates with every gift card purchase.
Beanie, Baby: L.L. Bean has a nice deal — an extra $10 gift card for every $25 you spend either in-store or online.
Have gift card, will travel: Marriott (Stock quote: MAR) also brings something to the table. The hotel behemoth will tag on an extra 10% for every gift card purchase of $50 or more.
Steak-Out: At high-end eatery Morton's, diners can get an extra $50 if they buy a $300 gift card. That offer ends Dec. 31, so act quickly. Rival Ruth’s Christ isn’t far behind — you can earn a 10% bonus card for every purchase of $250 or more at the restaurant.

When you shop for gift cards, remember the drill. Always read the fine print, check for expiration dates, avoid cards with any monthly fees attached, and check to see if the card issuer is in good financial health.

If there’s no motivation on that last point, just think of Circuit City last year and see if that rings a bell.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Are Big Banks Lending Enough?

The Associated Press — Thu, 12 Nov 2009 09:45:00 -0500

By Stevenson Jacobs, AP Business Writer

NEW YORK (AP) — The head of the Federal Deposit Insurance Corp. said Tuesday she's "very worried" that the nation's biggest banks aren't lending enough and warned the economy could take another turn for the worse without increased access to credit.

FDIC Chairman Sheila Bair said the FDIC's upcoming quarterly report would show that "not many large institutions are doing a very good job of lending." Instead, she said, some are taking advantage of near-zero interest rates by borrowing dollars cheaply to buy higher-yielding assets like stocks or commodities — a move known as the "carry trade."

"I don't see much money going out (from banks). I see a lot of carry trade," Bair told a banking conference in New York. "It used to be you take deposits and you lend out money. We'd like to see more of that."

Many banks have tightened lending standards following a wave of residential and commercial property defaults. Others say they want to lend but see little demand as consumers and businesses seek to pay off debt, not take on more.

The lack of lending by large banks is dangerous at a time when many small and midsize banks are teetering on the brink amid the economic downturn, Bair said.

"I'm very worried (that) the larger institutions don't seem like they're stepping up to the plate providing credit," Bair said. "Because if they don't do that, we're all in the soup."

Addressing the rash of bank failures, Bair said the FDIC had enough funds to shut down troubled banks and would tap its line of credit with the Treasury only as a last resort. There have been 120 bank failures this year, and Bair predicted "many more" ahead.

On the regulatory front, Bair reiterated her agency's bid to require banks to hold more capital as a buffer against rough times, even if it eventually reduces the amount of funds available to lend. She said the requirement would not only protect banks but could also help prevent asset bubbles by reducing excess credit in the financial system.

"I think we have the authority and hopefully the will to do that," she said.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Roth Rules for Retirees: When to Rollover

Jeff Brown — Thu, 12 Nov 2009 09:00:00 -0500

To rollover or not to rollover: That’s the question for millions of people who change jobs or retire in any given year. They must decide what to do with their defined-contribution retirement plans like 401(k)s, 402(b)s or 457(b)s.

The issue has always been complex, but now it’s even trickier for people who will have access to Roth IRAs after the first of the year repeal of the $100,000 income limit on “rollovers.”

In most cases there are four options: Leave your money in the former-employer’s 401(k) or similar plan, transfer it into the new employer’s or shift the money into a traditional or Roth IRA.

All but the Roth option can be done without triggering income tax. The Roth move can be expensive because of the upfront tax bill, but it may pay off in the long run, since Roth withdrawals are tax-free.

Here’s a quick run-down on the pros and cons of each move.

Keep the old plan. If you have at least $5,000 in the old plan, you can just keep it there, which is obviously the easiest option. It’s a good approach if you are happy with the plan’s investment offerings, especially if any aren’t available outside the plan. Note that once you leave the firm, you probably won’t be allowed to borrow against your plan assets or make new contributions. You’ll probably have to roll over to an IRA if you have less than $5,000 in the plan.

Shift your money to the new employer’s plan. This is a good choice if you like the new employer’s investment options or want to be able to borrow against plan assets. (Loans can severely damage investment gains.)

Shift to a traditional, tax-deferred IRA. Although you won’t be able to borrow against your account, an IRA rollover would give you virtually unlimited investment options, compared to one or two dozen mutual funds in the typical employer plan. You could invest in individual stocks or bonds, for example. A move to a traditional IRA (or a Roth) might allow you to choose investments with smaller fees than you’d pay in the employer plan.

Shift to a Roth IRA. In addition to getting a wider investment choice, this would allow you to make withdrawals in retirement without paying the income tax you would with an employer plan or traditional IRA, and you would not be required to start taking minimum distributions after turning 70 ½. The drawback is you would have to pay tax for the year you do the rollover. Tax would apply to all money that had not been taxed earlier, such as investment gains and original contributions that were tax deductible at the time. For a rollover done in 2010 the tax can be divided between 2011 and 2012.

Whether it's better to pay tax to do a rollover or to keep the employer plan and pay tax later largely depends on your tax bracket. A rollover to a Roth may not make sense if your tax bracket is higher now than it’s likely to be in retirement, since the tax bite would be smaller later.

For many years, rolling a 401(k) into a Roth was a cumbersome, two-step process of converting to a traditional IRA, then to a Roth. Now, it can be done in one step. Also, beginning in 2010, Roth conversions will no longer be restricted to taxpayers with incomes below $100,000.

Use the Roth IRA Conversion Calculator to determine whether a rollover to a Roth would make sense for you. And check with your employer plan provider, brokerage and mutual fund company for help with the nuts and bolts of a conversion. Many financial firms provide guidance on their Web sites. T. Rowe Price (Stock Quote: TROW) and Charles Schwab (Stock Quote: SCHW) have good ones, as do Vanguard Group and American Funds.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Gifts You Shouldn’t Buy Your Boss

David Seaman — Thu, 12 Nov 2009 07:00:00 -0500

With the holidays right around the corner, it isn’t too soon to start planning out your gift buys. If you’re shopping for your boss, however, you’ll probably want to avoid these choice items.

Find Your Financial Soul Mate

Seth Fiegerman — Thu, 12 Nov 2009 07:00:00 -0500

Our tips to help you figure out on the first date if you’ve met your financial soul mate.

Extreme Real Estate: Pin Thin Properties

Mark David — Thu, 12 Nov 2009 07:00:00 -0500

And you thought your house was cool? Check out these extremely awesome pieces of real estate.

Bank of Mom and Dad: Ruining Grandma's Credit

Farnoosh Torabi — Wed, 11 Nov 2009 22:00:00 -0500

Each week on SOAPnet’s new original reality series Bank of Mom and Dad, a twenty-something woman who is drowning in debt must pay the ultimate price ... letting her parents move in! With the assistance of money coach Farnoosh Torabi (that's me), Mom and Dad will teach their daughter to rethink her spending habits and transform her relationship with money.

This week we met “daddy’s little princess” Stacey from Landsdale, Pa. The 23-year-old is as an assistant kindergarten teacher struggling to make ends meet. She has more than $25,000 in debt, including several charged-off credit cards. When Stacey turned 18, she exercised her freedom by signing up for five credit cards, which she quickly maxed out.

Furthermore, Stacey has dropped in and out of college with no degree so far, lives at home with her divorced mom (because she can’t afford rent) and spends far too much on frivolous items (like $200 a month on doggy clothes for her pet).

Each month, aside from neglecting her credit dues she ends up short on her car payment. To make matters worse, her car is in her grandmother’s name and by not making the payments Stacey is effectively ruining her grandma’s credit (not to mention their relationship). Oh, Stacey. Here’s what mom, dad and I suggested:

FIND MORE AFFORDABLE WHEELS

This was a difficult message to get across to Stacey, since she is in love with her sports car. Our advice was to sell the vehicle and find a more affordable used car. The obvious dilemma with this is that Stacey wouldn’t be able to pay down her existing car loan by selling the car at the current market value, but it was financially better than what she’s dealing with now.

Here’s how we advised her to do it: Strike a deal with her local credit union to use some of the money she earns from selling the car to help pay down the existing car loan, then take out a private loan to pay off the remainder of the car loan. Begin paying down the private loan. Paying off the entire car loan allows her to transfer the car’s title to the buyer. With some of the other money she gets from the sale she could use it to buy a less expensive vehicle. In all, she could save at least $100 a month with this strategy.

FINISH SCHOOL

I designed a chart for Stacey illustrating that the more education she has the better her chances of earning more money. With only two years of college under her belt Stacey is in no position to demand a lot of money from her employers. If she wants to address her debt, start saving and be financially independent, she needs to finish school and invest in higher education.

GROW UP

Let’s not beat around the bush. Stacey is lost. She can’t decide on whether to finish school, even though mom and dad have generously offered to pay for her education expenses. Who turns down a free college education? Someone who doesn’t know what she wants from life, perhaps, like Stacey.

She parties like she’s 19 and has no concept of taking responsibility for her actions, proven by falling behind on her credit card and car payments. The first step in any kind of financial action plan is establishing goals and owning your adulthood. Stacey needs to soul search a bit and spend less time at the bars and more time thinking about her future.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Uncle Sam Wants A Donation

David Seaman — Wed, 11 Nov 2009 16:45:00 -0500

Uncle Sam wants your cold, hard cash so he can get out of his embarrassing $12 trillion in debt. He’ll hit you back, man. Promise. Actually, no. You get nothing in return except your donation can be counted as a tax-deductible contribution. This is the perfect article to send to that annoying friend from college who gets all riled up about the national debt… you know, the guy who sends you fifteen Ron Paul links per week and irritating photos of the national debt calculator.

As CNN reported, “Fiscal year 2009 saw $3.1 million in donations." Only $11,999,996,900,000 to go!

The program, in existence since 1961, isn’t known to many—but there is indeed a “Gifts to Reduce the Public Debt” account you can donate to… should you want to. Here are two ways to give Sam your donation: “One is to send a check directly to the Bureau of Public Debt, an agency within the Treasury Department. The address: Attn: Dept G, Bureau of the Public Debt, P.O. Box 2188, Parkersburg, WV 26106-2188. The other is to include a check -- separate from any tax payment you make -- with your federal income tax return.”

Of course, if you are like most Americans, helping out Uncle Sam probably ranks somewhat lower on the list of priorities than getting yourself out of credit card indentured servitude, saving your immediate family from heartbreaking high-interest debts, paying off student loans, and keeping the power on.

But if there’s some cash left over, now you know exactly where to send it. It’d be kind of cool if Uncle Sam also accepted donations for unwanted clothing, as Goodwill and the Salvation Army do. When you’re $12 trillion in the red, beggars can’t be choosers.

Twitter Partners with Linked In

Seth Fiegerman — Wed, 11 Nov 2009 16:15:00 -0500

Can you summarize your resume in 140 characters or less?

Twitter announced yesterday that it is partnering with LinkedIn, a career-focused networking site. Now, when users update their status on LinkedIn, they have the option to have that same update appear on the Twitter, and vice versa.

"More and more, people are finding that the persona they create for themselves on the Web is part of their resume in many ways," according to Biz Stone, a co-founder of Twitter. Ultimately, it’s a way for both sites to expand their user base.

But is it really a good idea to mix these two worlds? LinkedIn is considered by many to be insulated from the world of drunken photos and inane life updates that flood social networking sites like Twitter and Facebook. Do you really want employers to read about your career accomplishments and then stumble across posts about the last time you got blasted on Jagermeister?

PC World recently listed a few do’s and don’ts for users who take advantage of this new networking opportunity. One point they strongly emphasize is that while it’s fine to broadcast your LinkedIn updates on Twitter, it shouldn’t be a two-way street.

“Sharing an update about your recent promotion on LinkedIn via Twitter is a great idea, but all those drunken tweets you send out on Saturdays won't look so hot on your professional profile,” according to PC World.

Luckily, both networks will let you control which posts get published where. Use good judgment and don’t get so drunk you confuse the two sites.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Wal-Mart Extends Black Friday Hours

Seth Fiegerman — Wed, 11 Nov 2009 15:15:00 -0500

Wal-Mart’s (Stock Quote: WMT) Black Friday deals are so good, people would kill for them and, unfortunately, last year proved the point.

Thousands of overeager shoppers crowded outside a Wal-Mart in Valley Stream, New York, before store hours and accidentally trampled a Wal-Mart employee to death when the doors finally opened.

Customers may be even more ravenous this year as Wal-Mart continues to roll out one crazy deal after another in order to lure cash strapped Americans to their storefront.

In order to avoid another catastrophe this year, Wal-Mart is making several changes to the way its stores operate over Thanksgiving weekend. Discount stores will open at 6am on Thanksgiving Day and stay open through the night and all through Black Friday. (Wal-Mart’s supercenters will keep their usual schedule for the holidays).

As for the famous Black Friday bargain items, these won’t be rolled out in the store until 5am, as usual. But the hope is that customers will be more orderly if they don’t have to wait in line outside. "(Shoppers) will be dispersed through a 200,000 square foot store as opposed to all being right by the front door, waiting to go in," according to a spokesman for the company.

Once customers enter the store, they will see changes, too.

According to the New York Times, “When the products go on sale Friday at 5 a.m., workers will supervise the lines, giving shoppers the merchandise in the order in which they joined the line — until the goods are out of stock.” One worry, of course, is that the chaos outside the store will be replaced with chaos inside the store as people rush to line up for newly placed items.

Wal-Mart is not the only store trying to take precautions this year. The retail federation recently released a set of guidelines to help retailers and their employees manage their crowds during the holidays. Some points mentioned include giving shoppers wrist bands or tickets, and placing barriers outside the store to help manage the flow of traffic.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

Job Openings Still At Record Lows

The Associated Press — Wed, 11 Nov 2009 15:00:00 -0500

By Christopher S. Rugaber, AP Economics Writer

WASHINGTON (AP) — Job openings are at rock-bottom levels, according to government and private surveys released Tuesday, a trend that could keep the unemployment rate high even as layoffs slow.

Small businesses in particular are reluctant to add workers as they struggle to obtain credit. Many are pushing their current employees to produce more. Economists say small businesses account for about 60% of new jobs.

Still, there are some pockets of hiring as demand for information technology and sales professionals grows, according to government reports and job search Web sites. And there are signs that companies are adding more human resources personnel, which could signal more hiring down the road.

"We've seen a real spike in the hiring of contract recruiters," said Phil Haynes, managing director of AllianceQ, an employers' association that includes companies such as Starbucks Corp., Bank of America Corp. and Intuit Inc. "The recruiters come before the jobs."

But overall, it's a tough time to be out of work. There are about 6.1 unemployed workers, on average, competing for each job opening, a Labor Department report shows. That's down slightly from 6.2 last month, the most since the department began tracking job openings nine years ago.

It's a sharp increase from only 1.7 workers per opening when the recession began in December 2007.

The department's Job Openings and Labor Turnover survey said employers advertised about 2.5 million job openings at the end of September, up slightly from the previous month. That's down from a peak of 4.8 million openings in June 2007.

Layoffs are slowing a bit. Employers cut a net total of 190,000 jobs in October, the government said last week, much lower than the average of about 700,000 a month in the first quarter of this year. But until companies are willing to hire, the unemployment rate is likely to keep rising from its current level of 10.2%, the highest in 26 years.

The increase in joblessness came even as the economy grew by 3.5% in the July-September quarter, the strongest signal yet that the recession is over.

Many economists worry the U.S. will experience a jobless recovery. That happened after the last two recoveries in 1991 and 2001, when the unemployment rate didn't peak until 15 months and 19 months, respectively, after those recessions ended.

The National Federation of Independent Business said Tuesday that small companies remain skeptical about the recovery. Its Index of Small Business Optimism rose 0.3 points to 89.1 last month, the third straight increase but still below the 94.6 reading in December 2007.

Small businesses are reluctant to hire or invest in expansion, the monthly survey found. Sixteen percent of the survey respondents plan to cut jobs over the next three months, while only 9% plan to hire.

"Overall, the small business job machine is still in reverse," said William Dunkelberg, NFIB's chief economist.

Many small businesses also are still having a hard time getting loans, the report said.

Ray Pinard, the CEO of Boston-based 48HourPrint.com, was able to borrow to buy additional printing equipment but said it took much longer to find a lender than the last time the company needed a loan in 2007.

The additional equipment may eventually require more workers, but not anytime soon. "As we ramp up the volume on the equipment, we'll try to use existing personnel first," Pinard said.

Still, some companies are looking to increase revenue by hiring more sales people.

The Conference Board's Help Wanted Online report, released last week, found that sales jobs saw the largest increase in vacancies among the 10 largest occupations, with a jump of about 11%. But overall, total jobs posted fell by 83,200 last month to nearly 3.3 million, the business research group said.

Opel Solar Inc., an 8-year-old solar panel designer based in Shelton, Conn., and Toronto, Ontario, has added six positions this year as the government's stimulus package helped companies and communities get funding for solar projects.

Opel has one active opening, in sales, and will probably add one or two additional positions soon, vice president Pat Agudow said.

In addition, the information technology sector has been slowly adding jobs in recent months. According to the Labor Department's employment report last week, the computer systems sector added about 4,500 jobs in October.

Tom Silver, senior vice president for North America at Dice.com, a job site for technology professionals, said that job postings are increasing in two large technology markets — Silicon Valley and New York City — as well as some smaller locations, such as Austin, Texas, and Charlotte, N.C.

New York-based job postings have risen 16% so far this year, he said, while they are up 6% in Silicon Valley.

"For the first time in more than a year, recruiters and hiring managers have more confidence in the underlying business climate," he said.

___

AP Business Writer Tali Arbel in New York contributed to this report.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Slice and Dice: Card Companies Slash Rewards Programs

Brian O'Connell — Wed, 11 Nov 2009 14:30:19 -0500

Credit card consumers are under assault from all fronts, the latest being a sustained, industry-wide cutback on credit card rewards programs.

The trend toward lower reward options doesn’t make much sense at first glance — after all, what business wants to alienate its most loyal customers?

But card companies continue to struggle. According to the Web site LowCards.com, delinquency rates at five of the top six credit card issuers increased in September. With more cardholders owing more money, credit card companies have to look elsewhere to beef up the bottom line. And with tough restrictions coming from the Credit Card Reform Act (which kicks off in February), their options are limited.

"Issuers can't continue losing money. They have to find ways to make up the revenue, even if this angers Congress and consumers," says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. "To make matters worse for issuers, some fees and rate hikes will be prohibited after certain provisions of the CARD Act goes into effect in February.”

That leaves rewards programs in the crosshairs of the credit card companies. Here are some of the ways that card issuers are pruning back on rewards programs.

Late payment triggers. The primary hammer that card issuers are wielding is through late payments. More and more card issuers, including Bank of America (Stock Quote: BAC), Chase (Stock Quote: JPM) and American Express (Stock Quote: AXP) are canceling reward points built up in a period where the card holder hasn’t paid his or her bill.

Very late payers. If you’re behind on your card payment by two months, some card companies will cancel your accumulated reward points outright. Discover Bank (Stock Quote: DFS) will cancel reward points for missing two straight monthly payments.

Lower percentage formulas. Card companies are also cutting back on reward percentages. Instead of earning 1% or even 1.5% for amounts charged on the card toward reward rebates, card issuers are cutting that rate down. American Express, for example, has slashed one of its card-back deals from 1.5% to 1.25%.

Higher point hurdles. Card companies are also forcing reward customers to work hard for the money. Staples like free hotel rooms and free airline flights are increasingly going for twice the point totals from years past. Citibank (Stock Quote: C), for example, now makes travel reward customers earn 40,000 points for a flight valued at $400 — that’s up from 20,000 points previously.

What can reward customers do? For starters, make sure to pay your credit card bill on time. Set up automatic payments if you have to — anything that helps you meet your monthly card payment obligations will keep trouble at arm’s length.

If you do lose points due to late payments, some card issuers will allow you to “buy them back." For example, American Express Blue Card customers charge customers $29 for each month’s worth of points that were lost.

It’s getting ugly out there in the credit card rewards market. While you can’t stop card issuers from cutting back on rewards, you can mitigate some of the damage by keeping your payments on schedule.

It sounds strange, but in the Age of Recession, prompt credit card payments have become a rewards program of their own.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Husband vs. Wife: Last-Minute Holiday Saving

Marek and Lori Fuchs — Wed, 11 Nov 2009 13:00:00 -0500

This round, they try to make good on their failed promise to each other to save for the holidays. He promises to buy her a gift using frequent flier points, she says just wrap me a workable plan.

Can a married couple work together to fix a broken plan in time for a happy holiday? Or will the kids cry?

Mrs. Fuchs: Whoops, we did it again.

Mr. Fuchs: Oh no, a 4th kid?!

Mrs. Fuchs: No. We botched another financial plan.

Mr. Fuchs: Which one? Oh, I remember. Back in August, we vowed to set aside $100 a month for holiday shopping, which last year ran us about $1,500. But Black Friday, which signifies the start of the holiday shopping season, is almost here and guess what? In our busy life with all our expenses, we forgot again. Yet another good plan bites the dust. So what now? Time is tight. How should we save on the holidays if we haven’t stashed money away ahead of time?

Mrs. Fuchs: How do you feel about the night shift at Target (Stock Quote: TGT)?

Mr. Fuchs: Or celebrating the Chinese New Year instead—since it takes place in January we can take advantage of post-holiday sales. Or we can just pick fights with all of our relatives in the lead-up to the holidays and mend fences well afterward.

Mrs. Fuchs: You try explaining that to the kids. You’ll spend more on therapy than on gifts in the first place. But John Cioffi of Hazlet, N.J., had a good idea. What about wrapping our gifts in newspaper comic pages? That is good for the environment and I won’t have to shell out for adorable holiday gift wrapping. “It’s colorful enough,” Cioffi said, “and they usually run holiday themed strips two weeks before the holidays.” Plus, you’ll be saving the newspaper industry. We’ve also had past success in cutting down on adult gift giving by making side deals with siblings to only gift each other's kids.

Mr. Fuchs: Those are two good ones, but we need a plan with larger impact. At this point, we need something systematic — one of those four-point plans from a savvy financial planner.

Mrs. Fuchs: Where are you going to get one of those?

Mr. Fuchs: Surprise! The holidays came early for you — I have one!

Mrs. Fuchs: Oh joy.

Mr. Fuchs: Here comes Scot Stark, who runs Stark Strategic Management in Freeland, Md., and is president-elect of the Financial Planning Association-Maryland, to present you with your gift — a nicely wrapped four-point plan. Wrapped in comics, that is.

First off, Stark suggests paying cash for holiday gifts, which helps you resist the temptation to overspend your way into oblivion. “It just feels different to hand someone a $50 bill than it does to hand them your credit card and be charged $50.” True that, as they say.
Next, says Stark, ask for a discount. Even when they are not advertised, in this economy they might be yours for the asking. A few discounts can cut costs rapidly.
Third, Stark suggest the iPhone (Stock Quote: AAPL) App called Saving Benjis. It costs 99 cents, but more than earns its keep by allowing you to comparison shop while in actual stores.
Fourth, redeem purchaser points on credit cards. Many of these points are never used, but if you find yourself staring straight down the barrel of an expensive holiday season without having saved, look here. Which reminds me ... I haven’t gotten you a gift yet, but I have plenty of points stored up—

Mrs. Fuchs: As if ...

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Retail Therapy Is Cheaper Than Ever

Joe Mont — Wed, 11 Nov 2009 12:00:00 -0500

BOSTON (TheStreet) -- The lingering hangover of the recession has replaced the one-time mantra of "shop till you drop" with the new pricing strategy of "drop till they shop."

America has gone on sale, from traditional holiday gifts like electronics and basics such as food and housing to big-ticket items including cars.

Retailers are expecting the worst this holiday season after American shoppers from around the country said a year ago they planned to spend an average of $431 on gifts in 2008, a drop of 50% from a year earlier. Consumers will follow the same spending pattern this year, according to a poll by Harris Interactive.

Books and movies are taking front and center of the holiday season's price wars. Wal-Mart (Stock Quote: WMT), Amazon (Stock Quote: AMZN) and Target (Stock Quote: TGT), in particular, have escalated tit-for-tat out-pricing on DVDs, Blu-ray discs and best-selling books. In the case of DVDs, when Amazon instituted a $9.99 price point for select titles, Wal-Mart retaliated by undercutting the Internet retailer by a penny.

Not only big-box stores are offering discounts to lure shoppers. Even upscale retailers like Tiffany (Stock Quote: TIFF), Coach (Stock Quote: COH) and Williams-Sonoma (Stock Quote: WSM) have cut prices as the recession dragged on longer than at any time since the 1930s.

Starbucks (Stock Quote: SBUX), home of the $6 coffee, has dropped the price of lattes and iced coffee in some markets. How do you say "bargain" in fake Italian?

Across a slew of sectors, bargains and price breaks intensified as 2009 draws to a close, leading up to a holiday-shopping season that may make or break some stores.

FOOD

According to an October study by the American Farm Bureau, retail food prices in 29 states decreased for the fourth consecutive quarter and "are significantly lower than one year ago."

Retail prices for the most widely purchased food fell from a year earlier: whole milk, 27%; cheddar, 23%; potatoes, 22%; apples, 19%; eggs, 16%; vegetable oil, 16%; and ground chuck, 10%.

Items that bucked the trend and went up in price were bacon, orange juice and flour.

Food costs, however, can be tricky to gauge for consumers as manufacturers increasingly are packaging their goods in smaller packages. Where you live can also make a difference. Expect to pay more for a gallon of milk in New York City than you will in Wisconsin.

SMART PHONES

Even in a down economy, people still can't get enough of smart phones. But even as consumers gobble up the latest offerings by Apple, Research in Motion and Motorola, the price tag for these hand-held wonders is starting to drop.

According to forecasters with ABI Research, the greatest increase in smart-phone shipment volume over the next five years will be found in the $100 to $200 range. While only 18% of smart phones were priced less than $200 in 2007, 27% have cracked that mark this year. The research firm expects that by 2014, almost 45% of smart phones will hit that price point.

"Prices will hold at a certain point," says Kevin Burden, ABI's mobile devices practice director. "We may never see a $30 smart phone. But over time, smart phones will take a substantial part of the mainstream handset market."

HOUSING

Homes and apartments are at the lowest levels this decade.

According to Moody's, apartment prices nationwide declined 24% during the past year. On the East Coast, prices dropped the least, just 6%. In the South, they plummeted 44%.

Sales of new homes dropped unexpectedly last month as the effects of a soon-to-expire tax credit for first-time owners started to wane. (The credit is being renewed.)

The median sales price in October of $204,800 was off 9.1% from $225,200 a year earlier, but up 2.5% since August, according to the National Association of Realtors.

CLOTHING

If you're a guy in need of a new outfit, you're in luck. According to the U.S. Department of Labor, men's and boy's apparel prices have dropped 5.1% during the past six months. By comparison, women's and girl's clothing prices have risen 5.9%.

CARS

These are tough times for automakers but a good time for anyone looking for new wheels.

Including finance charges, the total cost of buying an average-priced light vehicle was $26,500 in the third quarter, down 5% from a year earlier, according to the Auto Affordability Index compiled by Detroit-based Comerica Bank.

Recession-spurred rebates and financing deals were credited for the increased affordability.

TECHNOLOGY

They hit the market as something of a novelty, but net books have caught on. With the right deal (sometimes connected to the purchase of a wireless connectivity card and service) you can grab one for around $200.

Almost 35 million net books will be shipped by manufacturers in 2009. The price-driven aspect of that success has some industry watchers speculating that basic laptops could drop to the $500 range in response.

Components have similarly come down in price. A terabyte of hard-drive space, once priced only within reach of corporations, can now be found for under $100.

Gamers will also have a few extra bucks in their pockets if they shop around. Various configurations of Sony's PS3 and Microsoft's Xbox have dropped to $299. The Wii, once believed to be frozen in price, is now on shelves for $199. For the most part, despite the hardware pricing, most games have retained their price points, a trend that may skew upward in response to the success that "The Beatles: Rock Band" had despite its $59 price tag.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

Who's Hiring Freelancers: RTUI, Mitchell 1 and Wise Payment Systems

Bobbi Dempsey — Wed, 11 Nov 2009 11:00:00 -0500

If you need extra money but don't want a staff job, freelance work may be the answer. These days, companies hire freelancers for everything from writing and design to delivery and sales.

Pros and cons: You usually don't get benefits, but can often set your own schedule and may even be able to work from home. The pay is self-employment income, and is viewed differently than normal wages by the IRS. You'll need to file specific tax forms with your annual return – and, depending on what you earn, you might need to submit quarterly tax payments. On the plus side, you can deduct many of your expenses, and may qualify for the home office deduction.

Here are three companies hiring independent contractors right now.

RTUI

What they do: National register tape advertising company.

Freelance opportunities available: Sales representatives.

Requirements: Sales experience, preferably in the B2B sector. Must have professional appearance and strong closing skills.

Hours/Pay: Hours may be long, especially at first while establishing yourself in your territory. Pay is based on commission. The company says some sales reps earn more than $1,000 per week.

Other info: Reliable transportation is required.

Apply here.

Next Page: Mitchell 1

Mitchell 1

What they do: Provider of business software for the automotive retail industry.

Freelance opportunities available: Sales reps.

Requirements: Sales experience, including cold calling. Experience in the auto repair industry and/or strong business management skills are preferred. Must have Windows software skills.

Hours/Pay: Work is generally done during normal business hours, but some long days may be required. Pay is based on a "lucrative" commission structure.

Other info: Company provides your inventory, extensive product training and continued sales support.

Apply here.

Next Page: Wise Payment Systems

Wise Payment Systems

What they do: Merchant bank card services, check processing, gift loyalty and rewards programs.

Freelance opportunities available: Sales reps.

Requirements: At least two years sales experience.

Hours/Pay: Company says you should expect to spend at least 40 to 45 hours per week on the job, with the majority of that time spent in face-to-face meetings with prospects either making presentations or closing sales. Pay consists of commissions, bonuses and incentives. Some commissions are paid up-front. They have signing bonuses of up to $10,000 for reps who hit certain sales levels during their first 90 days. Compensation plan is somewhat complicated, and is explained in an 11-page section on the company Web site.

Other info: You will be required to submit a daily report of your activities via phone or e-mail. Reps are required to participate in frequent training sessions via phone, online seminars, conference calls and classroom style training.

Apply here.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.