On the Horizon: What the Gov't May Do to Your Money in 2012

  • Government Work

    We’re not going to sit here and tell you what the government is going to do in 2012, because quite frankly, expecting them to do anything at all is a bit of a stretch. After all, 2011 was a year that saw the government come to the brink of shutdown due to partisan bickering, and the supercommittee appointed to resolve the debt debate predictably failed. We wouldn’t bet too much money on the prospect of the government having a productive 2012. Still, the past few years have seen the implementation of various financial reforms in response to the sub-prime mortgage meltdown, so the government does occasionally make real decisions that impact consumers. We decided to peer into our crystal ball and consider some of the changes that the government could bring to your money in 2012. Photo Credit: Getty Images
    Simplify Your Credit Card Agreement
  • Simplify Your Credit Card Agreement

    One of the more exciting developments for consumers in 2011 was the official opening of the Consumer Financial Protection Bureau, a new government agency intended to regulate consumer financial services. But from the beginning it has come under fire by Republicans in Congress objecting to its leadership structure, and Richard Cordray, Obama’s pick to lead the agency, has yet to be confirmed by Congress. But that hasn’t stopped the agency from making big plans that could impact consumers. On Wednesday, for instance, it unveiled a new template for credit card agreements intended to cut through the legalese and help consumers understand just what they’re getting themselves into. The new agreement, which follows an analysis of credit card-related complaints made to the agency, clearly lays out the pricing and terms of the agreement in plain English, and does it in a standardized format that makes comparisons simple. The template will go through a comment phase in which the public can weigh in on what they like and don’t like about the form before the final version gets a rubber stamp from the agency. Photo Credit: consumerfinance.gov
    Simplify Your Mortgage Agreement
  • Simplify Your Mortgage Agreement

    Of course, credit card agreements aren’t the only contracts that trip up Americans looking to borrow. To that end, the CFPB has also proposed a standard form for mortgage agreements that likewise simplifies the terms. The new form clearly states not only the interest rate and monthly payments, but also how high those figures can go in the case of an adjustable rate mortgage. That would have been especially useful in avowing the mortgage meltdown, which was partially attributed to homeowners defaulting after misunderstanding the terms of their mortgage. The new form is currently in the testing phase, and final regulations will be rolled out no later than July 2012. Photo Credit: consumerfinance.gov
    Make Mail Slower and Pricier
  • Make Mail Slower and Pricier

    The U.S. Postal Service has struggled mightily in the last few years to keep up with heavy pension requirements and a more digital world, and it posted a $5 billion loss in the 2011 fiscal year. That has led to a series of cost cutting moves, including raising the price of its first-class stamps from 44 cents to 45 cents effective on Jan. 22. OK, that’s only a penny, and you’ll only be gravely affected if you just purchased hundreds of 44-cents stamps. But the Postal Service is also cutting costs by shutting down many of its branches and fulfillment centers; the former may make it harder to find a post office in your area, and the latter will make mail take longer to arrive. Under the proposed changes, it will no longer be possible for regular first-class mail to arrive the next day. So if you’ve gotten used to paying bills and sending in rent checks the day before, plan to start allowing at least two days of lead time starting sometime next year. Photo Credit: Getty Images
    Keep Your Bank Rates Low
  • Keep Your Bank Rates Low

    We know death and taxes are the only sure things, but at least for the next year we can pretty much guarantee that bank rates will stay low as a result of Federal Reserve policy. The Fed announced in August that it plans to keep the key interest rate at near-zero levels through at least mid-2013. And as you might expect, that announcement sent already-low rates plummeting even lower, with even 36-month CDs now returning less than 1% APY. It would take a miraculous turnaround in the country’s key economic indicators – we’re looking at you, unemployment – to get the Fed to consider reversing this policy decision. So expect your savings accounts to continue their dismal returns through all of next year. The good news? If you’re looking for a loan and can manage to get one, you’ll continue to get great rates throughout the year. Photo Credit: stuartpilbrow
    Kill Baggage Fees
  • Kill Baggage Fees

    For a while now, your best shot of avoiding baggage fees when you fly has been to go with JetBlue or Southwest, the only two major domestic carriers that don’t charge for your first checked bag. But recently Congress has started making noise about stepping in to provide some fee relief. Sen. Mary Landrieu (D-La.) introduced a bill in November that would require every U.S. carrier to stop charging fees on the first checked bag, as well as on carry-on bags. In a satisfying bit of turnabout, any airline in violation of the new law would have to pay a hefty fee for its transgression. As we said at the time, it’s hard to imagine this bill actually going through – airlines made more than $4 billion in fees in 2010, so don’t expect them to let this one go without a big fight. But hey, you never know. Photo Credit: geishaboy500
    Make It Easier to Find a Job
  • Make It Easier to Find a Job

    One of the more interesting provisions of Obama’s now-defunct jobs bill was a new rule making it illegal to discriminate against someone for being unemployed. That provision came in response to mounting evidence that periods of unemployment carry a stigma for job seekers, and some companies even explicitly say that they won’t hire people who are unemployed. Employment experts we spoke to at the time were doubtful about the law’s prospects for success, and those prospects are even dimmer with the American Jobs Act dead in the water. And even if it did pass, such a law would likely do little to stop employers from considering employment status in making hiring decisions. Still, it would be interesting to see if the government revisits the issue in 2012. Photo Credit: Getty Images
    Cut Down on Unexpected Phone Bill Charges
  • Cut Down on Unexpected Phone Bill Charges

    Here’s one that you’ll definitely see in 2012: The beginning of the end for cellphone “bill shock.” As smartphones have grown more ubiquitous and unlimited data plans have disappeared from the major carriers, bill shock – unexpected charges for exceeding plan limits – has been on the rise. And with the Federal Communications Commission making noise about stepping in to regulate such billing practices, the wireless industry agreed in October to start implementing a system for alerting consumers in danger of exceeding their limits. The wireless industry has agreed to a self-enforcement regime, whereby each carrier will agree to start sending text messages to subscribers approaching and exceeding plan limits on data, text, voice and roaming. The carriers will implement at least two of the four alerts by Oct. 17, 2012, and all four alerts will be mandatory by April 17, 2013. Sadly, the government can’t stop Verizon and AT&T from capping its users’ data allowance. But it’s good to see that the threat of regulations will soon force your carrier to warn you of impending overage charges. Photo Credit: Getty Images
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