Back-to-school shopping usually consists of running out at the last minute and going to one store to try to get everything. If you do a little planning and put in a little extra effort, you will find yourself saving quite a bit. In other words, it pays to shop around.
Families surveyed by The National Retail Federation expect to spend an average of $96 per child on school supplies, and more than $600 when clothing, shoes and electronics are included. These numbers, however, do not include the additional items many schools are adding to their back to school lists this year such as dry erase markers, toilet paper, tissues, and anti-bacterial wipes. School budget cuts have left the burden of the extras up to the parents. This is estimated to drive the estimated $96 per child up to about $104 per child.
A few morning show segments this week have featured the cost comparisons of 20 items typically found on a school supply list, which inspired me to look into costs and may prove to be quite helpful. Comparing apples to apples in terms of quality, I priced major brand names: Crayola crayons, markers and colored pencils; Five Star notebooks, Avery Binders; Pilot G2 gel pens; Oxford folders; Texas Instruments TI-30 calculator. For more generic items such as rulers, protractors, index cards and loose leaf paper, the lowest price was focused on. Note: the items chosen were plain solid colors on everything — no patterns or designs.
The results were pretty dramatic: The same 20 items on my list cost $27.20 at an independent discount store, and three times as much, $83.44, at CVS. Big-box stores Target and Wal-Mart came in at $31.64 and $36.70, and Staples charged $66.72.
Both the independent and chain dollar stores (Family Dollar, Dollar General and Dollar Tree) have grown aggressively in the last decade, adding thousands of stores nationwide between 2001 and mid-2009, according to a study by The Nielsen Company. “There’s no question that the dollar stores are getting more and more shoppers every day,” says Britt Beemer, CEO of America’s Research Group. “When they added more food products to the stores, they really established value with consumers. They sell bread for $1 a loaf, and at the grocery store it’s $1.89 or $2.59. The dollar stores make a stronger value proposition as they added grocery, because people know the value of things they buy most often. Because they attract so many shoppers every week, manufacturers can no longer ignore the channel.”
For school supplies, you should definitely visit dollar stores first and then wait as far until the end of the season as you can for other stores so the items will be marked down as much as possible. The other nice advantage to dollar stores is that if you have a child like I was that like the colorful patterns and designs, you can generally find those there as well and for only $1.
Annuities, reverse mortgages, life insurance pools, principal-protected notes… the options being offered to senior citizens hoping to ensure a comfortable retirement are innumerable. And in a growing number of cases, that may be the intention as more scammers, often the elderly themselves, try to con retirees. Though hard numbers are difficult to come by, many lawyers and advocates for the elderly say more seniors than ever are being lured into investment schemes that are unsuitable for people of their age or are outright swindles.
One out of five Americans over the age of 65 has been the victim of a financial scam. That means more than 7.3 million seniors have been taken advantage of financially through inappropriate investments, high fees, or fraud. Many of today’s scam artists have a particularly good understanding of their victims, this being because the fraudsters themselves are of retirement age, if not exactly retired. More elderly con artists than ever seem to be preying on retirees, perhaps because senior citizens put more confidence in someone their age.
In November, William Kirshner, 84, a financial adviser in Corpus Christi, Tex., was sentenced to five years in prison for stealing more than $100,000 from senior citizens and other clients who invested in promissory notes issued by his company. Ronald Keith Owens, 74, was sentenced to 60 years in prison in January 2009 for persuading investors, including retirees, to put more than $2.6 million into nonexistent bank-related investments. And William Walter Spencer, 68, a Franklin (Tenn.) financial adviser, sold elderly members of his church promissory notes that turned out to be bogus.
Veterans are one of the biggest targets. Several groups offer to help former soldiers sign up for a $2,000-a-month benefit from the Veterans Affairs Dept. in Washington. While the program is real, some groups are telling seniors they can only qualify if they liquidate their assets and purchase an annuity, which usually comes with a hefty sales commission.
Reverse mortgages, which let people aged 62 and older get cash out of their homes and are repaid when the borrower dies or moves, are a big part of many scams. One popular ruse is urging the elderly to finance annuity purchases with a reverse mortgage, despite a ban on cross-selling them with other financial products. Other unsuitable investments being pushed on seniors are pools of life insurance policies, similar to the bundles of home mortgages that helped fuel the financial crisis. Some of these have turned out to include policies that don’t exist, and it’s unclear whether they’re supposed to be overseen by state insurance regulators or the Securities & Exchange Commission.
Principal-protected notes are another investment being pushed on the elderly. Seniors tend to fall for these because the name makes it sound as if they’re risk-free; in fact the principal isn’t always protected, as holders of notes backed by Lehman Brothers learned when the firm collapsed.
The new financial regulatory reform bill would crack down on advisers who market themselves as specialists in investments for seniors, and another measure would include harsher penalties for anyone committing securities fraud against the elderly. “We need better regulation of this industry,” says 75-year-old Senator Herb Kohl (D-Wis.), who heads the Senate’s Special Committee on Aging, “so seniors can tell the difference between professionals who offer clear and unbiased financial advice and bad actors… who steer them toward inappropriate financial products.”
According to a 2008 Bureau of Labor Statistics survey, the average baby boomer has worked 10 jobs by his or her 42nd birthday. Younger people tend to change jobs even more frequently; sometimes as often as every one or two years when they are fresh out of college.
Many job changers simply leave their pensions, 401(k) accounts, or other employer-sponsored retirement plans in the care of their former company without giving it a second thought. Sometimes former employees forget about these older retirement plans. Something could also happen with the company that prevents them from paying you. For example, companies may merge, get bought out, or go out of business and be unable to contact you when it is time for you to begin receiving your pension or other retirement benefits. But that doesn’t mean your money isn’t still there. Whether you left behind $100 or $100,000, it’s your money and you should claim it and use it toward your retirement goals.
If you were once employed by a company that offered a pension, try contacting your former company. If you can’t find the company or they don’t have a record for you, then contact the Pension Benefit Guaranty Corporation, a Federal agency that insures private sector pensions. At the PBGC website you can look up information about pension plans trusted by the agency. To make your claim you will need to provide a variety of information including your Social Security number, the dates you worked at the company, pension plan name, PBGC case number, and company or plan sponsor name.
The PBGC may also be able to help you find a lost 401(k) plan. If that doesn’t work, try the National Registry of Unclaimed Retirement Benefits (NRURB). The NRURB is a free service managed by the La Mesa, California based benefit distribution processing firm PenChecks that works to put you in contact with your former employer so you can claim your retirement benefits.
Another important step in your retirement planning is consolidating your retirement accounts. It’s much easier to balance your portfolio and plan for retirement when you only have a few accounts. You may be able to roll some or all of your previous retirement account balances into one or two accounts. For example, you may be able to roll old 401(k) plans into your current 401(k) plan or you can roll over a 401(k) plan into an IRA. You can also roll all your other IRAs into a new IRA.
Make sure you understand which accounts can be combined and which accounts must remain separate though. You can’t combine traditional IRAs and Roth IRAs. But you may be able to do a Roth IRA conversion, which will re-characterize your traditional IRA contributions. Keep in mind that you may have to pay taxes when you make the transition from a traditional IRA to a Roth IRA.
BP is becoming increasingly strict with its demands for documentation from victims filing claims for lost wages and income in the Gulf region. Immediately following the spill, many initial payments were distributed in uniform amounts with minimum documentation necessary based on estimates. Now, BP is only going to make payments based on very specific documentation of the losses. As a result of these more stringent standards, some claimants could get more money than the standard check they have been receiving while others could get much less.
Those claimants that are already in the claims system but have yet to submit the necessary documentation will get a $1,000 “good faith” check for July as they continue to gather papers, but they will not get full payment until proper documentation has been submitted. Once the claimant submits the necessary documents, if they show that the victim is due more than the $1,000 advance payment for July, BP said it will provide a supplemental payment to make up the difference.
In the first months after the oil spill, BP was just cutting checks to the victims based on estimates without requiring specific documentation. For example, boat captains that ran a crew got a $5,000 initial check and deckhands got $2,500. The problem, especially in this scenario, was that fishermen earn the bulk of their annual pay in a few peak months that vary depending on the particular seafood being caught. Now, when they submit their paperwork, those variations will be accounted for.
As BP tightens its demand for documentation, the company insists it is not trying to shortchange any claimants. I don’t believe Gulf residents will see it this way at all. Is BP trying to shirk responsibility?
Divorce is a major financial transaction; that being said, it can have major tax implications and some pitfalls you will want to try and avoid. This is especially true when splitting up tax-favored retirement accounts between you and your soon-to-be ex-spouse. You are going to have to plan ahead to make sure that the tax results work out favorably for you. For example, if you have a qualified retirement plan at work or a self-employed business retirement program, you’ll probably have to divide up your retirement account(s) between you and your ex as part of the divorce property settlement. However, if you do so carelessly, if can create a real tax fiasco for you.
To divide up qualified retirement plan accounts the tax savvy way, you need to establish domestic relations order, or QDRO. The QDRO establishes your ex’s legal right to receive designated percentages of your retirement balance or designated benefit payments from your plan. The good news is that the QDRO also ensures that your ex, and not you, will be responsible for the related income taxes when he or she receives payouts from the plan. The QDRO arrangement also permits your ex-spouse to withdraw his or her share of the retirement plan money and roll it over tax-free into an IRA. That way, your ex can take over the management of the money while postponing income taxes until withdrawals are taken from the rollover IRA. If the money in your qualified retirement plan gets into your ex-spouse’s hands with out a QDRO being in place, however, you will be facing a potentially disastrous tax mess. You will be treated as if you received a taxable payout from the plan and then voluntarily turned the money over to your ex.
You don’t need a QDRO, however, to divide up an IRA between you and your soon-to-be ex without dire tax consequences. All you have to do is arrange for a tax-free rollover of money from your IRA into an IRA that you can set up in your ex’s name. Then your ex can manage the rollover IRA and defer taxes until he or she begins taking money out of the account. You still need to be careful though. The tax-free rollover deal only applies when your divorce agreement requires the rollover. If the money important that you never transfer IRA money to your ex in advance of a legal requirement in your divorce papers to do so or you could, again, get hit with all the taxes.
So the question remains, are you going to divide up your tax favored retirement account money in the smart way or the dumb way? Unfortunately, many competent divorce attorneys know little or nothing about taxes, so you will need to find a legitimate tax professional who has handle lots of divorce-related tax issues.
Small Business insurance is more often than not a necessity, not an option. If you are a business owner, you will have many choices, some of which are far better options than others. Buying business insurance is among the best ways to prepare for the unexpected. Without proper protection, unexpected events such as the death of a partner or key employee, embezzlement, a lawsuit, or natural disaster could bring about the end of any thriving operation.
Anything ranging from everyday worker’s compensation insurance to the relatively obscure executive kidnapping coverage is available for nearly any business at risk. Considering the multitude of available options, business owners must carefully weigh whether the cost of certain premiums will justify the coverage for a given risk. Do the means justify the end?
General Liability
Many business owners buy general liability, or an umbrella policy, to cover legal issues due to claims of negligence. This coverage helps protect against payments as the result of bodily injury, property damage, medical expenses, the cost of defending lawsuits, and settlement bonds or judgments required during an appeal procedure.
Product Liability
Every product is capable of personal injury or property damage. Companies that manufacture, wholesale, distribute, and retail a product may be liable for its safety. In addition, every service rendered may be capable of personal injury or property damage. Businesses can be considered liable for negligence, breach of an express or implied warranty, defective products, and defective warnings or instructions.
Home Based Business Insurance
Contrary to popular belief, homeowners insurance policies will not, generally, cover home based business losses. The most commonly needed insurance areas fro home based businesses include business property, personal and advertising injury, loss of business data, crime and theft, and disability.
Internet Business Insurance
Web based businesses may wish to look into specialized insurance that covers liabilty for damages done by hackers and viruses. On top of that, e-insurance often will cover specialized online activities, including lawsuits resulting from meta tag abuse, banner advertising, and electronic copyright infringement.
Criminal Insurance
No matter how tight the security may be in your workplace, theft and malicious damage are always possibilities. While the dangers associated with hacking, vandalism, and general theft are obvious, employee embezzlement is much more common than business owners think. Criminal insurance and employee bonds can provide the necessary protection against losses in most criminal cases.
Business Interruption Insurance
Some business, especially those along the Gulf Coast, may wish to acquire insurance that covers losses during natural disasters, fires, and other catastrophes that may cause the operation to shut down for a significant amount of time.
Trying to reform retirement benefits has always led to volatile politics in Washington, but Europe proves to be no different. Today, many debt burdened European countries, as well as the United States, are considering raising the age at which retirees can collect partial and full pension benefits. Not surprisingly, the you know what is already hitting the fan.
Retirement ages vary between countries. While many have set 65 as the official age that you can collect full benefits, some places favor an earlier break from the rat race. Some groups of workers in Greece are now able to claim benefits in their 50s, while the retirement age for everyone else is 60 for women and 65 for men. A planned overhaul of the system would change all that. Greece, as part of its broader austerity plan, has committed to bringing the minimum early retirement age up to 60 for everyone. This means that pension benefits for many will be reduced if they’re claimed between 60 and 65.
In France, 60 is the kick-off point for most people to collect full pensions IF they’ve worked 40 years. Those who started work in their teens can collect benefits as early as 56. But there is a proposal to raise the age to 62. French unions last week expressed their disdain in a nationwide strike. So chances are they won’t like hearing this: 62 may not be enough for the long run.
In Europe and the United States, life expectancy and time spent in retirement have been increasing, while fertility rates and the number of workers paying into the social security systems have been falling. This, obviously, does not add up or bode well for younger generations. In the late 1960s, men in Spain spent less than 10 years in retirement; now they spend more than 20. In France, the time in retirement has risen from 10 years to almost 25. The jump in the United States is also large, but not as drastic, from just under 10 years to roughly 18.
Of course, increasing the retirement age is only one piece of the pension reform puzzle that spurs controversy. Changes to the taxes that support pension benefits and adjustments to the formulas that determine them are also on the table. Many social security systems, like the one in the United States, are largely pay-as-you-go. Workers and their employers pay into the system and that revenue is used to support present-day retirees. Since public pushback can limit how much policymakers can do at any one time, and because unforeseen circumstances such as an economic crisis can create new concerns, pension reform is rarely a one-and-done deal.
Some countries that have embarked on reform in recent years, such as Sweden and Germany, created fail-safe mechanisms that automatically adjust benefits as needed to keep their systems solvent. Whether those kinds of changes will be accepted in the United States isn’t at all clear. But what is clear is that when U.S. policymakers choose to take up Social Security reform, which they haven’t done since 1983, chances are that every proposed change will make for a tough fight with the American public.
Prior to the recession, people simply looked for a house, any house, to buy. Later on, buyers were hesitant just thinking about buying. Now, they seem to be on a quest for perfection at the perfect price. Perfection seeking buyers are turning the battered real estate market upside-down. Agents are saying that this is leading to last-minute demands for multiple concessions, bruised feelings on all sides and many more collapsed deals than usual.
It is a complete reversal of roles from the boom, when competing buyers were sometimes reduced to writing heartfelt letters saying how much they loved the house and how they promised to eternally worship the memory of the previous owners. Nowadays days, it is the buyers who are coldly seeking the absolute best deal while the sellers are left in emotional turmoil.
It was largely expected that the housing market would suffer at least a temporary hangover after the government’s $8,000 tax credit expired in April, but not necessarily this much. In some places, sales dropped more than 20 percent from May 2009, when the worst of the financial crisis had subsided. Builders have been affected too. The Commerce Department has stated that the construction of new homes in May dropped 17.2 percent from April, which is significantly lower than forecast. Permits for future construction dropped 10 percent, suggesting a sluggish summer. Even the lowest home mortgage rates in decades are not doing much to promote deals. The Mortgage Bankers Association has said that applications for loans to buy houses were down by a third compared with last year.
Against such a backdrop of misery, buyers are empowered — and are taking full advantage of their position. Buyers, of course, say they are merely being smart. In some cases, however, agents have said that sellers literally cannot afford to make concessions. Another $10,000 will push them underwater, which means they will have to arrange the sale through the bank. Even when a sale can be worked out, it is not uncommon for everyone to walk away feeling more aggravated than excited.
BP’s new strategy to clean up its image and the Gulf Coast is to hand the job from its British CEO, who has been widely criticized for his inappropriate comments and yachting amid the crisis, to one of its top-ranking Americans. Bob Dudley is no stranger to tough situations; he protected the company’s interests in rough dealing in Russia even after he was barred from the country. Most importantly though, he is a fresh face for the oil giant as it attempts to fix the spill and protect its future. Dudley will take over as BP’s point man on the spill response, reporting to Hayward. Company officials have variously put the time frame at anywhere from immediately until after the spill is plugged, which doesn’t appear to likely happen until August.
Hayward’s gaffes include saying, “I’d like my life back,” and most recently enjoying a yacht race off the coast of England on Saturday while oil spill relief workers sweated it out. BP officials, however, say the switch is intended to allow Hayward to focus on running the company, rather than an attempt to bounce back from bad publicity. Analysts say Dudley’s job will involve nothing short of rehabilitating the environment, compensating everyone who has suffered a loss and generally salvaging BP’s global image.
Dudley has plenty of experience protecting BP’s interests under great pressure. As chief of TNK-BP, a joint venture with a consortium of Russian billionaires, he steered the firm through a series of politically explosive disputes that saw one employee charged with espionage, the company’s offices raided by Russian intelligence, an investor boycott and a barrage of tax and labor investigations. At one point, there was a huge effort put forth to remove him from office, but Dudley clung on until 2008, at one point running the company from abroad after Russian authorities barred him from the country. Despite fears that BP’s partners would expropriate the British company’s share of the venture, BP has managed to keep its cut of TNK-BP’s multibillion-dollar profits.
Dudley also has shown a steady hand in his limited public appearances since the April 20 oil rig explosion that killed 11 workers and triggered the Gulf spill. He was the one tapped to make the rounds of the Sunday morning shows at the end of May when BP’s latest bid to stanch the flow fell short. “We failed to wrestle this beast to the ground,” he said matter-of-factly. A week later, he struck a conciliatory note as he toured the Louisiana coast with Gov. Bobby Jindal, saying he was frustrated and saddened by what he saw. He was there to promise that BP would fund state efforts to build sand berms to protect barrier islands from the oil. “We understand the importance of this,” he said. “We are deeply sorry.”
Industry insiders such as former Shell Oil president John Hofmeister have argued that BP from the start should have made an American the public face of its spill recovery efforts. “I’ve been saying for weeks that Tony Hayward ought to pass this over to his top American executive,” Hofmeister said Sunday. “He has completely competent people in the U.S. that can represent him in every instance.” Hofmeister said Dudley has been involved in the Gulf oil spill recovery effort from the start, and he expects no changes in BP’s approach once he takes over. “I think this is just a natural step for him to be exclusively focused on this aftermath,” he said.
President Barack Obama has said he would fire Hayward if he could, and many Gulf Coast residents have had their fill of him as well. Craig Bielkiewicz, a fisherman who’s unemployed as a result of the spill, said as long as BP foots the bill for the cleanup, it’s better that Hayward just stay away. “As long as he foots the bill and does what he says he’s going to do, then we don’t need him,” he said. “All we need is for him to back off and let us do what we need to do.”
Dear BP: Let the workers do their jobs and keep signing the checks. Stop wasting your money on PR campaigns; your image is in the tank for the time being. Let’s work on the real problem at hand: the oil leak.
The Federal deficit is over $13 trillion; what’s an easy to start cutting the debt? Stop writing checks to dead people.
The government sent benefit checks to 20,000 departed Americans over three years, totaling more than $180 million. This ridiculous number provoked the Obama administration to create a government-wide “do not pay” list as part of its brainstorming for ways to save taxpayer money. Once the database is up and running, agencies will have to search it before sending out payments. A pre-check check. “We’re making sure that payments no longer go to the deceased — it sounds ridiculous to even say it,” acknowledged Vice President Joe Biden in describing the database.
Also planned for inclusion: contractors who’ve fallen behind in their payments or, even worse, landed in jail, and companies that have been suspended or otherwise deemed ineligible for government work. “This stuff seems obvious on its face,” Biden acknowledged. “The voters will go, ‘My God, isn’t that happening already?'” In fact, the Social Security Administration does have what it calls a “Death Master File.” But some other agencies don’t routinely check it before issuing benefits. The same goes for the General Services Administration, which has an “Excluded Parties List System” for ineligible contractors. An order signed by President Barack Obama on Friday centralizes the information from numerous sources.
The figures don’t just stop at payments to the deceased; the figures also show that checks went to 14,000 convicted felons, both in jail and still on the lam. The three-year total there: $230 million. With the federal debt mounting and red ink worries spreading across Europe, Obama is under increased pressure to cut spending sharply. Recently, he told federal agencies to come up with ways of trimming 5 percent from their budgets next year, and of saving billions in Federal building costs. Another cost-cutting measure announced Friday was an online fraud detection program for Medicare and Medicaid. The Office of Management and Budget said those programs made $65 billion in erroneous payments last year.
The software, developed by officials charged with scrutinizing Obama’s stimulus plan, was demonstrated for reporters by OMB Director Peter Orszag. A slide show portrayed auditors using it to discover that a number of contractors and subcontractors scheduled for payment by the government were in fact located in a single home. Plus, a satellite photo showed the home had a pool and a boat. “Suspicious,” Orszag said. The White House believes there are improper payments of all kinds — from outright fraud to checks to inmates to simply mistyped pay stubs — totaled $110 billion in 2009. “We think we have the tools now to take a real bite out of this,” Biden said.
Back-to-school shopping usually consists of running out at the last minute and going to one store to try to get everything. If you do a little planning and put in a little extra effort, you will find yourself saving quite a bit. In other words, it pays to shop around.
