Monthly Archives: October 2014

How to Bounce Back From a Financial Crisis

The general economy may be on the mend, but that doesn’t mean yours is.

Unemployment may be the lowest it has been since 2008 (5.9 percent as of September), and consumer confidence may be higher than in recent years, but that doesn’t mean your own bank account is tracking as well. In fact, you may find yourself feeling low because the economy is recovering and wonder if you’ve done something wrong.

You probably didn’t. It’s just your day, week or year to have some bad money luck. So if you’re in a tight spot and haven’t the foggiest idea how to deal with a financial crisis, here’s your three-step plan.

Survey the landscape. If things just got bad, “take a deep breath,” urges Commie Stevens, managing director of strategic and financial planning for Beacon Pointe Advisors in Newport Beach, California. “People in crisis often want to take immediate action to fix the problem,” she says.

Immediate action sounds logical. If you’re suddenly unemployed, you want to become employed as fast as possible, or if your car’s transmission dies, naturally you want to administer transportation CPR, stat. But you may make your money problems worse if you, for instance, take out a high-interest loan to replace the transmission or jump into the wrong job to bring in some fast cash.

“Taking any financial action the day of the crisis is rarely required and often results in costly missteps,” Stevens says.

Start planning now, however. There is no harm in brainstorming immediately if you’re up to it. That’s how you can talk yourself out of the bad ideas that look harmless at first glance.

Pare your budget. This is the time to do what you can to manage your monthly bills, especially if you haven’t done so in a long time. “Call the bank holding your home and car loans, as well as call your credit card companies to see if you qualify for a lower rate and lower payment on any of your debts and obligations,” says Jon Ulin, a certified financial planner and managing principal of Ulin & Co., in Boca Raton, Florida. “In some cases, a bank may provide clients a hardship allowance to pay a lower rate on their mortgage for a set period of time, of which the balance may be tacked back onto the loan principal.”

But you shouldn’t take a hardship allowance lightly. You’ll get relief now, but youâ??ll pay for it later.

You should also be careful what you say to your lenders. Asking for a hardship allowance may be the thing to do with your mortgage or vehicle lender, but telling your credit card companies you’re financially pinched is the last thing you want to do. If you share that you no longer have a job or your income has been compromised, your credit card issuer may end your spending privileges or lower your credit line.

This is also the time to try to lower your bills, like cancel cable television or at least drop some channels. If your problem is unemployment, “make every effort to not default on any of your obligations,” Ulin says, “as many employers are now looking at your credit score as part of the hiring process. It’s a wicked catch-22.”

Use what you have. You may feel helpless if your money problems are serious, but you may have more tools in your toolbox than you might initially think, as Zaida Khaze discovered.

Khaze, who lives in Palisades Park, New Jersey, says her family’s financial crisis came slowly. In 2009, she quit her job at a nonprofit organization shortly after her first daughter was born, then she decided to go back to work after her second daughter turned 6 months old. She and her husband, George, an entrepreneur who works in the entertainment industry, bought their home with the idea of having two incomes, and they were beginning to feel the financial effects of being a one-income household.

But in December 2011, shortly after Khaze began interviewing, and right about the time Khaze’s husband canceled their health insurance to save money, their oldest daughter was diagnosed with persuasive developmental disorder, considered a mild form of autism. Their medical bills shot up, and because the physician recommended a restrictive diet, so did their grocery bills. For the next two years, Khaze and her husband’s incomes were extremely tight.

Things have only started improving in the last year or two, as has Khaze’s daughter’s condition. Her PDD diagnosis was recently removed.

But during those two years, Khaze says she began working as a baby sitter through sites like Sitter.com and Care.com. She was able to find immediate work and could baby-sit, as well as take care of her own children, at her house. She and her husband also sold their second car for $9,000, using the money to pay for their daughter’s school. They found a free health insurance program for their kids through the state, and Khaze launched WiggleTot.com, which sells a pad that makes it easier to change a baby’s diaper.

Khaze is 41, but creating businesses is something Ulin says he sees a lot of his older clients doing. “If you’re a boomer nearing retirement in your 50s or 60s, professional reinvention isn’t just for young people,” he says. “We’re seeing plenty of boomers with an entrepreneurial itch seriously exploring startups as an option. These are highly educated people who lost their jobs and realize those jobs aren’t coming back. They’re utilizing their corporate skill sets to run their own companies.”

Of course, starting a business may not be in your DNA. In that case, Ulin suggests looking for work in industries that are hiring, such as health care, in positions that fit your skills. In this case, “you’re not reinventing yourself, you’re redeploying your skills,â? he says.

Your financial crisis may not be unemployment or even underemployment. You may have that car with transmission problems or be facing a raft of medical bills you can’t possibly pay. But the point is always the same: Don’t panic, and be wary about grabbing the first solution that comes along. If you aren’t careful, a quick fix may put you in a fix later.

http://money.usnews.com/money/personal-finance/articles/2014/10/28/how-to-bounce-back-from-a-financial-crisis

‘Collabition.’ ‘Decisioning’: The worst corporate jargon around

corporate jargon dot top

NEW YORK (CNNMoney)

For instance, when you’re asked to “strategerize a greenfielded, collaborative solution that considers the equities of all stakeholders” you may think you should do something eco-friendly.

But you’d be wrong.

According to one CNNMoney reader from Alexandria, Va., who was asked to do this very thing, what you’re really supposed to do is just work with everyone on your project to come up with a solution.

Or consider the role of peanut butter. Unless you work for Skippy, you may wonder what it has to do with anyone’s job. But if you ask the numbers guys in your division, they may talk about how “we peanut butter spread the dollars across all segments.”

The real meaning? We allocated money to every department (or region or category of expense), according to another reader, who works in the insurance industry.

Linguist Geoffrey Nunberg, who teaches at University of California, Berkeley’s School of Information, equates corporate jargon with high school slang — the kind teenagers use to sound like they belong.

“Using it marks you as an insider,” Nunberg said.

Plain English seems to be in particularly short supply when there’s potential to scare the pants off the rank-and-file.

Quiz: Are you a corporate jargon junkie?

One reader got word that management planned “to leverage internal efficiencies by enlisting external resources, thus driving a reduction in operating costs, thereby enhancing shareholder value.”

Translation: Layoffs are coming. That way we can promise to reduce our operating costs, which Wall Street loves! But don’t worry — we’ll outsource the old jobs to an outside firm, which may even hire the very same folks who get pink-slipped!

“Good thing no one ever asked how much money we saved, because the answer was none. Our operating costs actually went up,” said a CNNMoney reader in Sarasota, Fla., who worked at a company that promised to “leverage” and “enhance” efficiencies.

That may help explain why outsourcing is such big business. An invitation to an industry conference about the practice promised to “have one foot planted in the reality of present day, and the other in the future, so we can develop a realistic roadmap for crossing this chasm from today’s tactical efficiency to our utopia of achieving genuine business value and alignment between business operations and corporate objectives.”

Plain-English translation: No idea. But utopia sounds nice.

Related: Workaholism: Regain balance before you burn out

Judging from the slew of submissions from CNNMoney readers, there’s a long list of words and definitions that you need to know to be an insider these days. Here are 10 of our favorites:

Ideation session: Sure, you could just say you’re having a meeting to come up with good ideas for a new project. But why not hold an ideation session to action plan a strategy?

Collabition: Word mash-ups can be fun. Or they can make you cringe. Exhibit A: collabition, an ill-conceived merger of “collaboration” and “competition.” It’s a close cousin, of course, to coopetition (cooperation + competition).

Onboard: Training new employees is essential. So is persuading colleagues why your proposal is a good one. But “onboarding” them makes it seem so much more … sporty?

Rightsize: Getting rid of workers sounds like a such a downer. Why not keep things upbeat and say you’re “rightsizing” the company.

Decisioning: Making a decision. Really, why is that so hard to say?

Parking lot: When you don’t want to talk about something — say when you’re running a meeting and get caught short by a question — you might say “let’s put that in the parking lot.”

Level set: When someone says, “let’s level set” or “we need to level set with the group” it’s akin to saying “we should get together to figure it out.”

Unsuck-it.com, which deciphers business jargon, offers another definition: to agree on expectations.

Or you can use it to postpone dealing with something unpleasant, such as when someone questions the wisdom of what someone else says. “Once that phrase gets pulled [in a] meeting, the glaring disagreement is kicked along to be dealt with later,” said one reader.

Cadence: Who says marching band has to end when you leave school?

When you’re in sales, you might call clients once a month to make sure they’re happy. But apparently it sounds much better to tell your team to “establish a regular cadence of outreach with our clients to ensure we are delivering value,” a reader wrote.

Updation: Merely an awkward way to say “update.” A reader from North Carolina said it began as a joking term when his company was developing its current operating system. Now it actually appears in the operating system as an “action description.”

Open/ing the kimono: To reveal or be transparent about something. Several readers nominated this as a contender for all-time worst corporate jargon. Agreed.

Said one reader: “I end up visualizing whoever said it and I really don’t want to …. Plus, in my experience, the person then proceeds to lie, which makes the phrase even more abhorrent.”

First Published: October 26, 2014: 3:38 PM ET

http://rss.cnn.com/~r/rss/money_pf/~3/oSsmniDjlLo/index.html

IRS changes the 401(k) rules for 2015

“For those over 50 years of ageâ??a group that needs to be far more aggressive about savingâ??the fact that they can get $24,000 a year in contribution is a strong message for them to save at a significant rate,” said Kevin Crain, Bank of America Merrill Lynch’s managing director with more than 30 years of experience in the retirement industry.

“If you look back to 2009, limits on 401(k) were around $16,000. These aren’t huge bumps but it’s slowly incrementing upwards and it’s a nice message on the opportunity and power to save,” Crain said.

Read MoreThe procrastination penalty for retirement savers

If a worker is investing in both an after-tax Roth IRA (where withdrawals are tax-free), as well as a pretax program, then the contribution limit applies to the amalgamation of both accounts, the IRS said.

For small business owners and self-employed workers that invest in an SEP-IRA or a single 401(k), the 2015 annual contribution limit rises to $53,000, a jump from $52,000 in 2014.

People who max out their contributions remain a minority but that group is growing, Crain said. In general, about 15 to 20 percent of active contributors max out their contribution limit, he said.

Read MoreLook who’s using flex time now

http://www.cnbc.com/id/102115185

Senate Republicans block consideration of student loan bill

Updated at 12:15 p.m.

The Senate shot down a proposal Wednesday to allow Americans paying off student loans to refinance at a lower rate, bringing yet another Democratic priority to a grinding halt.

The bill, authored by Sen. Elizabeth Warren, D-Mass., failed to clear a procedural hurdle that would have brought it up for consideration in the face of Republican opposition. It went down by a vote of 56 to 38. It would have affected an estimated 40 million people begin paying a lower interest rate on their loans, but never would have won GOP support because of the way it was paid for: a minimum tax of 30 percent on Americans earning between $1 and $2 million each year.

“Today is a really good day for billionaires. For the 40 million people dealing with student loan debt it wasn’t such a good day,” Warren said after the vote. “This raises the fundamental question, who does Washington work for? Does it work for those who can hire armies of lobbyists to make sure that every single loophole in the tax code is protected for them? Or does it work for young people who are trying to get started in life?”

But Republicans called the bill a “political stunt” that would do nothing to help future students.

“The Senate Democrats’ bill really isn’t about students at all, its really all about Senate Democrats, because Senate Democrats don’t actually want a solution for their students, they want an issue to campaign on to save their own hides this November,” said Senate Minority Leader Mitch McConnell, R-Ky.

McConnell and Sen. Lamar Alexander, R-Tenn., the top Republican on the Committee on Health, Education, Labor and Pensions, both said it also fails to address the root of the problem.

“This is not a serious proposal. It’s not going to help people. College graduates don’t need a dollar a day tax subsidy to pay off their loan. They need a job…and they’re experiencing right now the worst situation for finding a job that they’ve seen in a long, long time,” Alexander said.

Senate Majority Leader Harry Reid, D-Nev., however, said that the mounting student loan burden – more than $1 trillion across the economy – prevents college graduates from being able to otherwise move on with their lives by getting married or purchasing homes.

In a press conference following the vote, he quoted Dave Bratt, the Virginia Republican who beat House Majority Leader Eric Cantor in a primary election Tuesday night, as saying, “The Republican Party has been paying too much attention to Wall Street and not enough attention to main street.”

“We saw another example of that just a few minutes ago down on the Senate floor. The Republicans shut down debate on a common sense bill to help 44 million Americans struggling under the crushing debt of student loans,” Reid said.

President Obama has taken up the cause of student loans this week, moving to expand a program that caps the amount borrowers have to pay in loan payments at 10 percent of their monthly income. At a speech announcing his executive action on Monday, he urged lawmakers to support Warren’s bill and lambasted Republicans for their expected refusal to do so.

“It would be scandalous if we allowed those kinds of tax loopholes for the very, very fortunate to survive while students are having trouble just getting started in their lives,” Mr. Obama said. “If you’re a big oil company they’ll go to bat for you. If you’re a student, good luck. Some of these Republicans in Congress seem to believe that just because some of the young people behind me need some help, that they’re not trying hard enough.”

The student loan bill is likely to be relegated to a campaign issue now along with other proposals to boost the minimum wage and close the gender wage gap that have also been defeated in the Senate this year.

© 2014 CBS Interactive Inc. All Rights Reserved.

http://www.cbsnews.com/news/senate-republicans-block-consideration-of-student-loan-bill/

Can I get a Social Security do-over?

Robert Powell, USA WEEKEND 12:02 p.m. EDT October 10, 2014

USA WEEKEND personal finance advice columnist, Robert Powell(Photo: Josh T. Reynolds for USA WEEKEND)

Veteran personal finance journalist Robert Powell answers your questions for USA WEEKEND.

I started collecting Social Security at 62. That was January of this year. I thought I was going to be able to stop working full time and go part time. Unfortunately, I don’t think I will be able to stop working full time till sometime next year. Can I go back and suspend my Social Security?

— Mark Esing, Lake City, Fla.

However, you could withdraw your application for Social Security retirement benefits. If you are receiving benefits and change your mind, you can withdraw your claim within 12 months and re-apply at a future date.

If you choose this option, however, remember that you must repay all the Social Security benefits you and your family received. The repayment must include any benefits you, your spouse or children received (whether they live with you or not) and money withheld from your Social Security checks, including Medicare Parts B, C, and D premiums, voluntary tax withholding (VTW) of federal income taxes, and any garnishments.

Read more of Robert’s advice here. Submit a question below.

Read or Share this story: http://usat.ly/1xytFje

http://www.usatoday.com/story/experience/weekend/lifestyle/2014/10/10/personal-finance-can-i-get-social-security-do-over/17032777/

Faith Calendar | Heraldnet.com – Local News

at Everett Unity Center for Positive Living, 3231 Colby Ave. More info: 425-258-2244, www.everettunity.org . Unity Lynnwood: The Aug. 3 message by Spiritual Director Richard Loren Held is Jesus and Prayer. Myrtle Fillmore’s letters (co-founder of Unity) is the source for this material and will be the focus of study for August. Services are at 9 and 11 a.m.at 16727 Alderwood Mall Parkway. More info: 425-741-7172 or www.unityinlynnwood.org . Meetings, classes Jewish ethics: Explore Pirkei Avot (Ethics of the Fathers), 7:15-8:15 p.m.
For the original version including any supplementary images or video, visit http://www.heraldnet.com/article/20140802/NEWS01/140809808/Faith-calendar-

Linda Stern | Journalist Profile

Linda’s Feed

Oct 1, 2014

NEW YORK, Oct 1 (Reuters) – It makes sense, given the gains

workers have seen in their retirement plans and in home prices

in recent years, that they would consider tapping their 401(k)

accounts to buy homes. And that is exactly what a growing number

of workplace savers are doing, according to a new study from

Fidelity Investments.

“Over the past year alone, more than 27,000 investors took

loans specifically for the purchase of a home,” said Fidelity,

which looked at data from workplace retirement plans it runs.

Sep 3, 2014

NEW YORK, Sept 3 (Reuters) – When everyone else starts

loading their backpacks and shopping the back-to-school sales, I

know it is time for me to dive back into TurboTax.

That’s because fall is the perfect time to plan my approach

to the tax forms I won’t file until next April. By using the

next four months strategically, I may be able to reduce the

amount I have to pay then.

Aug 13, 2014

NEW YORK (Reuters) – Investors who wish they were better at buying low and selling high actually have a tool that can force them to do just that. It’s called “rebalancing” – the practice of regularly re-allocating a portfolio so the investments in it stay in their originally intended proportions.

A 60 percent stocks-40 percent bonds portfolio will get out of kilter if you leave it alone long enough. To rebalance, you have to cut back on the portion that grew – typically the stocks – and add money to the other side.

Aug 13, 2014

NEW YORK, Aug 13 (Reuters) – Investors who wish they were

better at buying low and selling high actually have a tool that

can force them to do just that. It’s called “rebalancing” – the

practice of regularly re-allocating a portfolio so the

investments in it stay in their originally intended proportions.

A 60 percent stocks-40 percent bonds portfolio will get out

of kilter if you leave it alone long enough. To rebalance, you

have to cut back on the portion that grew – typically the stocks

– and add money to the other side.

Jul 30, 2014

NEW YORK (Reuters) – The financial advice business is changing dramatically in every aspect, from how advisers spend their time, to what they charge, to how they label and promote themselves.

The result? Further confusion for consumers who probably sought help to find clarity in the first place.

Jul 30, 2014

NEW YORK, July 30 (Reuters) – The financial advice business

is changing dramatically in every aspect, from how advisers

spend their time, to what they charge, to how they label and

promote themselves.

The result? Further confusion for consumers who probably

sought help to find clarity in the first place.

Jul 16, 2014

NEW YORK (Reuters) – Is there a target on the back of my dress? Because it feels like there is a target on the back of my dress.

It was painted there by the financial services industry, which has grown hyper-aware of the fact that women have a lot of money and are about to have a lot more.

Jul 1, 2014

NEW YORK (Reuters) – The U.S. Treasury Department has just given a tax break and its blessings to retirement savers who want to buy long-term deferred annuities in their 401(k) and individual retirement accounts.

The new rule focuses on a particular kind of annuity. These so-called deferred “longevity” plans kick in with guaranteed income when the buyer turns, say, 80 or 85 years old. For example, a 60-year-old man who spent $50,000 on a longevity annuity from New York Life could lock in $17,614 in annual benefits when he turned 80, the company said.

Jul 1, 2014

NEW YORK, July 1 (Reuters) – The U.S. Treasury Department

has just given a tax break and its blessings to retirement

savers who want to buy long-term deferred annuities in their

401(k) and individual retirement accounts.

The new rule focuses on a particular kind of annuity. These

so-called deferred “longevity” plans kick in with guaranteed

income when the buyer turns, say, 80 or 85 years old. For

example, a 60-year-old man who spent $50,000 on a longevity

annuity from New York Life could lock in $17,614 in annual

benefits when he turned 80, the company said.

Jun 20, 2014

New York (Reuters) – Jack Bogle, the founder of Vanguard Group Inc and the pioneer of low-cost index investing has won.

Data shows investors have steadily paid lower mutual fund fees every year since 2003. Some 35 percent of all money in mutual funds is managed passively by computer models instead of humans. The average upfront sales fee paid to brokers by mutual-fund investors has fallen 74 percent since 1990, according to the Investment Company institute, a trade group.

http://blogs.reuters.com/linda-stern/

Citigroup Says Sec Has Closed Its Probe Of Mortgage Securities, No New Enforcement Action | Fox Business

says it’s been told by the Securities and Exchange Commission that the agency has completed its investigation of the bank’s conduct regarding mortgage bonds and won’t bring further enforcement action. Citigroup said in a regulatory filing Friday that it received the information from the SEC this week. The SEC has filed a series of cases against Citigroup and other big Wall Street banks in recent years over their sales of securities backed by risky mortgages ahead of the 2008 financial crisis. The banks have paid hundreds of millions of dollars to settle the SEC charges. The five-year statute of limitations for filing such civil cases has imposed a deadline on the agency for bringing enforcement actions. SEC spokesman John Nester declined to comment.
For the original version including any supplementary images or video, visit http://www.foxbusiness.com/markets/2014/08/01/citigroup-says-sec-has-closed-its-probe-mortgage-securities-no-new-enforcement/

Pension Payments Delayed To Retired Chicago Teachers – Chicago Sun-times

My apologies to everyone, Rehak said. We definitely we will not let it happen again. But the delay caused confusion among some retired teachers. The fund had trouble deciding if it would open its Loop office Saturday to issue checks to those who need money immediately. At first it announced it would open, then later in the day reversed the decision. Finally, late Friday it said its offices at 203 N. LaSalle would be open from 9 a.m. to 3 p.m., however, the fund warned of possible lengthy waits.
For the original version including any supplementary images or video, visit http://www.suntimes.com/28996592-418/pension-payments-delayed-to-retired-chicago-teachers.html

Assurestart Launches Online Small Business Insurance Sales In Wyoming – Yahoo Finance

Buying a business owners policy (which combines business property and general liability coverage) through traditional commercial insurance channels can take several days or more. As a result of AssureStarts all-new technology and efficient direct sales process, the company is able to pass along savings in the form of lower rates. As the only insurer exclusively focused on small businesses, our mission is to help small business owners meet their unique insurance needs through an industry-leading technology platform, said AssureStart CEO Greg Tacchetti. A growing number of small businesses handle their administrative tasks on the Internet. Were offering a new way for them to buy business insurance and manage the entire process on their own, said Tacchetti. With certificates of insurance available at the point of sale, a small business owner can buy a policy online and present the necessary credentials to start work on a client project the same day. AssureStarts proprietary technology platform and recommendation engine can be accessed 24/7 via laptop, tablet or smartphone. During the application and purchase process, prospective customers can contact a licensed insurance professional by phone, email or web chat to ask questions or receive more information. AssureStart is backed by the financial strength of American Family Mutual Insurance Company, rated A (Excellent) by A.M.
For the original version including any supplementary images or video, visit http://finance.yahoo.com/news/assurestart-launches-online-small-business-151600524.html