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CACC Moneywise Monthly
Budgeting & Savings News You Can Bank On
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March 2013
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Five tips on how to manage your money better
Perhaps it's the $851 billion in credit card debt Americans owe, or the $8 trillion borrowers owe on their homes. Or maybe it's because the median household income is only roughly $50,000. Whatever the case, April is National Financial Literacy Month, with the goal of helping Americans establish and maintain healthy financial habits.
Patrick Bet-David, an entrepreneur, author and self-made success has made financial literacy his personal crusade. He came to America with nothing and built a financial services marketing empire. When he arrived in the U.S., he was shocked to find so many people struggling in what people around the world consider to be the land of opportunity.
Here are five of Bet-David's tips on what people can do to better manage their money:
Focus on new ways to earn money
People complain they don't have enough money, but they come home at 5 p.m. and call it quits. That's not good enough! If you're serious about getting ahead, start a side business learning to cut hair, selling jewelry or cell phone cases, cleaning houses or whatever. It doesn't matter what. Just start a business! With the opportunities presented by today's technology, it isn't that hard to do.
Ignore the Joneses
We all know the expression, but the best advice is to ignore the Joneses altogether and live your own life. Get rid of the things you really don't need. Cancel your cable TV. Stop drinking soda. Cut out Starbucks. Are you really using that pricey gym membership? Do you really need a landline these days? Make a promise to never pay retail for something and become a better buyer using websites like Overstock, Craigslist and eBay.
Expect more
People usually make the amount of money they feel they are worth, and most people sell themselves short. If you have a high self-image, you will create a world for yourself that meets that self-image. Stop bringing yourself down and start building yourself up.
Get thick on cash
The notion that the American Dream is linked to buying a home is ridiculous. About 90 percent of middle-class America buys too early. When you have three years of your mortgage payment saved in cash, then you can buy a house. It's much better to have liquidity. Cash gives you freedom. Get thick with cash before you think about major mortgage debt.
The right balance of urgency and patience
Have patience while choosing what to do to make your money. Wealthy people typically choose one industry and become the best at it, and this can take time. Act with urgency because people think they have a lot of time when they really don't.
TAKE ACTION:
April is National Financial Literacy Month. Get a head start by committing to read at least one personal finance book by the end of next month. Here is a list of top books:
Change your money management style for free with the Money Smart program developed by the FDIC? It's the smart way to improve your fiscal fitness!
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Are you a Shopaholic?
Excerpted from http://recessionista.com
Like any addiction expert will tell you, the first step to recovery is admitting that you have a problem. So, admit it: you're an overspender! Now here's how you can get it under control:
You spend money when you're emotional. This doesn't just mean upset or angry (although who hasn't engaged in a little retail therapy?) but also when you're happy. No matter your mood, buying new things makes you feel better, and you can always find a way to justify your purchase. Much like people who eat to suppress or celebrate their feelings, those who spend when they're emotional are at risk for larger issues. Small frivolous purchases are one thing; but once you're hooked, you need larger and more expensive purchases to maintain that same shopping high.
And guess what? It's a vicious cycle, because those same feelings that you might be trying to suppress by spending often lead to additional feelings of stress and anxiety. Chances are that when you go on a spending binge, the results are more costly than you expected. With excessive spending comes debt; and with debt, comes phone calls from debtors, lowered credit scores, and in extreme cases, bankruptcy. If your spending habits result in temporary happiness only to be overcome by financial stress, repeat after us: you have a spending problem.
Read the entire article here.
** Do you need help creating your family budget? Talk to a CACC Credit Counselor toll-free 1-800-763-1874 or visit www.caccdebt.org.
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New Tools for Retirement - Why the Ones that Get You There Won't Keep You There!
3 Ways to switch up strateges and guarantee income
by Philip Rousseaux
If there's one thing Americans have learned from the financial crisis of 2008, it's that they do not want to lose their money - again - especially for folks of a certain age, says financial advisor Philip Rousseaux, a member of the esteemed Million Dollar Round Table association's exclusive Top of the Table forum for the world's most successful financial services professionals.
"Losing nearly everything you've worked for throughout your entire adult life is right up there with being diagnosed with a major medical condition; it means the lifeblood of your future has been drained," says Rousseaux.
"Aggressive investment strategies that offer potentially huge rewards are fine for people younger than 40, but even they should have at least a portion of their retirement portfolio in investments that will provide a guaranteed income. The closer you get to your retirement age, or if you're already retired, the more important it becomes to change the tools in your financial toolbox."
Whether investors are decades or a just a few years away from retirement, or are currently retired - and whether or not they lost most, some or no money at all during the mass money meltdown - Rousseaux offers tips and tools to help you stay retired:
Look for the hidden fees in your employer-sponsored 401(k)
Last July 1, a new Department of Labor rule required all hidden fees attached to retirement plans and mutual funds be disclosed to employers and employees. By some estimates, up to 90 percent of fees attached to retirement plans are hidden! Get an accounting of all fees and if you can't decipher the information, attend a financial workshop or talk to a financial adviser. It may be time to roll some your money into a less expensive plan. According to an AARP survey, 71 percent of those with a 401(k) had no idea they were paying fees for their retirement accounts.
Explore fixed-rate indexed annuities
Investing all of your retirement savings in Wall Street exposes you to a lot of risk. That may be acceptable when you're in the prime of your career, but it's important to find alternatives that provide for growth while protecting savings. "Fixed-rate indexed annuities, where you loan an insurance company money and it guarantees you payments over a specified length of time, allows you to forecast the income you'll generate," Rousseaux says. "While these annuities will have a ceiling on interest rates, they'll also have a floor. Your principal is safe and you can ride an up market without the risk."
Turn your IRA or 401k into a joint account
For many people this may sound like a new concept, but this is something Everest Wealth Management has been using a planning tool for the last decade. While it's true the IRA, which stands for Individual Retirement Account, is something only one person can own, many alternative investments such as a fixed annuity offer benefits such as guaranteed lifetime income. Within these plans the owners have the option to guarantee income on both lives, thus creating a joint income for both the husband and wife.
How much you have isn't as important as you think
For years planners have touted finding your magical number so that you can afford retirement. This is simply not an accurate measurement and isn't what matters, according to Rousseaux. "With interest rates at 60-year lows and people living longer due to health care advances, the priority in planning is how much income can you generate and will that income last for your lifetime." The income your investments can generate is the key to successful retirement planning in the second phase, which Rousseaux calls the distribution phase.
Philip Rousseaux is the founder and president of Everest Wealth Management and Everest Investment Advisors money management firm.
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If you have the desire and the ability to make extra payments towards your DMP, contact CACC Customer Service to coordinate making the extra payment. Since your DMP is set up to pay a certain amount each month changes must be handled properly to make sure you do not get removed from the Creditors DMP.
CACC Customer Service: 1-800-763-1874 Do you know someone who would benefit from money management strategies and information? |
How to "pop the question" for less
By Andrea Woroch
Did you know that there actually is a National Proposal Day? It was created to kick-start conversations about getting married, no doubt, by Wedding Planners or dress makers. National Proposal Day happens in March and has gained traction amidst hundreds of other random observances. Though not yet part of the federally recognized calendar of holidays, the event will get some people's minds churning about the best ways to propose.
Though it's an important milestone, a proposal doesn't need to rival the cost of the actual wedding. Read on for inexpensive, meaningful ways to pop the question.
Scavenger Hunt
Love notes and scented candles are all you need to create a romantic scavenger hunt. Tie in memorable moments to the clues placed throughout your home, which should ultimately lead to you and the ring. Make sure you have a bottle of bubbly to pop once he or she says, "yes!
Create a scrapbook
Present your loved one with a scrapbook filled with pictures and captions of your favorite memories as a couple. Print digital images for as little as a penny per print through Snapfish. Write "Will you marry me?" on the last page of the album, and get down on one knee when she flips to it. Not only will it be unexpected, but you'll have a wonderful keepsake of the moment to treasure for years to come.
Make a game of it
From Scrabble to Pictionary, you can ask for your partner's hand in a playful and surprising way. Rearrange the tiles in Scrabble to spell out "will you marry me" while he or she is getting a drink or using the restroom. Manipulate a Pictionary card and be on bended knee when you accurately guess your soon-to-be fiancé's drawing of a marriage proposal.
Plan a picnic
A bottle of wine, a cozy blanket and a secluded spot sets the scene for an uber-romantic proposal. Stream love songs through Pandora as you reminisce about the first time you met. Consider hiding the ring among picnic fixings inside the basket for your loved one to find.
Make it a family affair
For those who can't imagine celebrating a special moment without family close by, go ahead and get them involved. Invite family and friends over for dinner and pop the question just before serving the first course. If you'd rather finish the meal first, you can always wait until dessert. Just make sure there's enough Kleenex to go around for everyone.
Andrea Woroch is a nationally-recognized consumer and money-saving expert who helps consumers live on less without radically changing their lifestyles.
Thank you for choosing Consumer Advocates Credit Counselors. We welcome your comments and suggestions for future issues. Please email education@caccdebt.org with your ideas.
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4 Smart Ways to Spend Your Tax Refund
It's the time of year that many Americans look forward to: tax refund season! The school of thought for most people is usually one of two theories on what to do with that money: use it to pay off credit cards, other expenses or put it in savings; or go wild, treat yourself to something nice like a vacation or shopping spree and enjoy it.
Steve Siebold, author of the book How Rich People Think, says dumping the average refund of $3,000 into savings isn't going to make a significant impact in terms of the big picture, so look for ways to get a healthy return with your refund.
His four recommendations:
Personal and business development
Formal education will make you a living; self-education will make you a fortune. There's a reason that very successful people are constantly attending business and personal development seminars. If you want to see a massive return on your tax refund, invest it in ways to better yourself such as self-improvement audio programs, business workshops and seminars or coaching and mentoring programs. School is never out for the great ones.
Start a business
There are 3 million millionaires in the U.S. and they are the largest buyer of personal services. It's a perfect time to use that refund to start a lawn care service, maid service, handyman business, pool cleaning company, grocery shopping service, etc. Huge opportunities also exist for selling and brokering used goods like clothes, toys, computers and sporting goods. These items can be purchased at garage sales and resold on and offline.
Get fit and healthy
Taking control of your weight and overall health is the fastest way to ascend to world-class success in all areas of your life. Use that tax refund to invest in exercise equipment or a gym membership. Not only will you feel better, but that confidence will carry over into everything you do. Your level of success in your career, relationships and everything else will drastically improve.
Take that vacation
The reason: the most successful people know the enemy of creativity and clarity is excessive cognition. Cognitive overload will bring anyone down both personally and professionally, and it's why world-class performers take this time off to slow their thought process down, and elevate their consciousness to gain a fresh perspective.
Have a money saving idea that you'd like to share?
Send it to us for possible publication in this newsletter!
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Countdown to Healthcare Reform
Tax Credits in 2014 When the Affordable Care Act brings enrollments through Health Insurance Marketplaces starting in October 2013, you may be eligible for a new kind of tax credit you can use right away to lower what you pay for your monthly health plan premiums. With most tax credits, you have to wait until you file your taxes to get the credit. But the new tax credit available through the Marketplace lets you reduce your costs right away. People who qualify can take the tax credit in the form of advance payments to lower their monthly health plan premiums starting in 2014, which can help make insurance more affordable. You'll see the amount of tax credit you're eligible for right after you submit your Marketplace application (coming in October 2013). Once you enroll in a qualified health plan, you can control how much of your tax credit you want to use to help pay your monthly health plan premiums. The tax credit is sent directly to your insurance company and applied to your premium, so you pay less out of your own pocket. The amount of tax credit you're eligible for depends on how much income your family expects to earn. When enrollment starts in October 2013, it will be important to double check your application to make sure everything is accurate. If the amount of income you report isn't accurate, you may not get the right amount of tax credit you're eligible for, and it could mean you have to pay back money at the end of the year. What are the subsidies? Subsidies will be determined on a sliding scale, based on income, so that individuals at the lower end of the income scale get the most help paying for their health insurance coverage. So, based on your income compared to the Federal Poverty Level, the amount you'll be required to pay for your health insurance will be a percentage of your income. The Federal Poverty Level in 2013 in the 48 contiguous states and District of Columbia for a family of 2 for example it is $15,510; and for a family of 4 it is $23,550. Hawaii and Alaska have slightly higher poverty levels. The Affordable Care Act has these parameters currently set up to decide how much you'll pay: Income Premium Limit Up to 133% of FPL 2% of income 133-150% of FPL 3-4% of income 150-200% of FPL 4-6.3% of income 200-250% of FPL 6.3-8.05% of income 250-300% of FPL 8.05-9.5% of income 350-400% of FPL 9.5% of income All people who buy coverage through an exchange will have a cap on their total out of pocket spending including deductibles, co-pays and co-insurance. As you can see, the more you earn the more you'll be required to pay for your Health Insurance coverage, but everyone will be expected to pay something, so all consumers need to understand the Affordable Care Act and be ready to cover some costs of their Health Insurance Coverage.
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Your friends and neighbors are suffering with money problems!
They need your Help! CACC is a non-profit, IRS approved 501(c)3 educational and counseling organization. Our expenses and operations are supported through generous contributions from corporations and individuals like you. Will you please consider providing some financial support so that we can continue our mission? The donation you make today will help fund debt relief programs, education and client services while providing help and hope to thousands. Won't you help us give the gift of Debt Relief?
YES, I'd like to help fund CACC's Debt Relief and Education efforts with a contribution of:
( ) $25 ( ) $50 ( ) Other $___________.
Please Mail your Donation to:
CACC Education Development
23123 U.S. 441, Suite 107
Boca Raton, FL 33428
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Free Workshops and Seminars 
As a non-profit Credit Counseling and Financial Education organization, CACC is dedicated to reaching out to the community. CACC provides financial education seminars and workshops at community centers, local organizations, and companies.
Popular Topics Include:
- Managing Money in Tough Times
- Creating and Using a Spending Plan
- Managing Debt
- Fighting Identity Theft and Financial Fraud
- Understanding Your Credit Report and Boosting Your Credit Score
- Creative Ways to Teach Kids About Money
- How to Get Out of Debt
Ask about customized seminars for your group, staff, congregation, organization, or club!
Call 1-800-763-1874 or e-Mail: education@caccdebt.org
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Consumer Advocates Credit Counselors, Inc. is a 501 (c)3 non-profit credit counseling organization providing credit counseling, financial education, and debt management services. Please visit our website at: www.caccdebt.org
Additional consumer resources:
Free Birthday Gifts
Stay Safe On-Line
US General Services Administration Federal Citizen Information Center
National Drug Abuse Hotline 1-800-622-HELP
National Domestic Violence Hotline 1-800-799-SAFE
Suicide & Depression Hotline 1-800-999-9999
National Council on Problem Gambling 1-800-522-4700
Fair Debt Collection Practices Act
Homeowners Hope Hotline for Mortgage Counseling and Assistance 1-888-995-4673
Benefits.gov
Learn about a variety of Government Benefits, how to qualify and how to apply.
Supplemental Nutrition Assistance Program (SNAP)
SNAP is the new name for the federal Food Stamp Program.
Temporary Assistance for Needy Families (TANF)
TANF is designed to help needy families achieve self-sufficiency. States receive a block grant to design and operate their programs to accomplish the purposes of TANF. These are:
-assist needy families so that children can be cared for in their own homes
-reduce dependency of needy parents by promoting job preparation, work and marriage
-preventing out-of-wedlock pregnancies
-encouraging the formation and maintenance of two-parent families.
Medicaid
Medicaid is health insurance that helps many people who can't afford medical care pay for some or all of their medical bills.
Good health is important to everyone. If you can't afford to pay for medical care right now, Medicaid can make it possible for you to get the care that you need so that you can get healthy and stay healthy.
Supplemental Security Income (SSI)
is a Federal income supplement program designed to help aged, blind, and disabled people, who have little or no income.
It provides cash to meet basic needs for food, clothing, and shelter.
Low Income Home Energy Assistance Program (LIHEAP)
If you can't afford to pay your home energy bill, your home may not be safe, and you may be at risk of serious illness or injury. The LIHEAP may be able to help keep you and your family safe and healthy.
National School Lunch Free Lunch Program (NSLP)
Established in 1946, The National School Lunch Program (NSLP) is a federally assisted meal program operating in public and nonprofit private schools and residential child care institutions. It provides nutritionally balanced, low-cost or free lunches to children each school day.
Federal Housing Assistance/Section 8 (FPHA)
Public housing assistance was established to provide decent and safe rental housing for eligible low-income families, the elderly, and persons with disabilities. Public housing comes in all sizes and types, from scattered single family houses to high rise apartments for elderly families.
Home Affordable Modification Program (HAMP)
888-995-HOPE
If you are struggling with your monthly mortgage payments or have already missed a payment, now is the time to take action.
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Contact Us:
phone: 1-800-763-1874
CACC Money Wise Monthly Editor in Chief:
Mike Schiano, "The DebtBuster"
'Til Next Month, Consumer Advocates Credit Counselors, Inc.
This newsletter is designed to provide accurate and authoritative information with regard to the subject matter covered. This information is given with the understanding that neither CACC nor the Editor and Writers are engaged in rendering legal, accounting, or other professional advice. Since the details of your situation are fact dependent you should always seek the services of a competent professional before making any financial decisions.
Copyright©Consumer Advocates Credit Counselors, Inc. 2013. All Rights Reserved.
Use of all or part of this newsletter is allowed with proper attribution and link: Source: Consumer Advocates Credit Counselors, Inc. www.caccdebt.org
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