Avoid Foreclosure and Get Help With Your Mortgage Payments

From the USA.gov Blog:

Avoid Foreclosure and Get Help With Your Mortgage Payments:

If you need help paying your mortgage, you may be eligible for assistance through a variety of programs.
Through the Making Home Affordable program, you can

• Refinance and take advantage of lower mortgage interest rates.
• Reduce your monthly mortgage payments.
• Get mortgage relief if you’re unemployed.
• Get help when you owe more than your home is worth.
• Avoid foreclosure when homeownership is no longer affordable or desirable.

You can also talk to a housing counselor to get advice on buying a home, avoiding foreclosure, or learning about reverse mortgages.
If you’re considering refinancing your mortgage, learn the costs and determine if the time is right for you.
Get help with your mortgage and foreclosure questions.
To learn about other free resources to help you no matter what your financial situation, sign up for our e-mail list or visit our page.

Go Direct

Direct Deposit: Theft Protection for Your Federal Benefit Payments

Help safeguard your money from financial crimes by switching from paper checks to electronic payments today

Source: U.S. Department of the Treasury, Financial Management Service

If you receive federal benefit payments by paper check, did you know that criminals can steal your check from the mailbox, making you a victim of financial crime?

Last year alone, more than 540,000 Social Security and Supplemental Security Income checks were reported lost or stolen.  Despite the risks, people in Michigan still rely on 182,600 Social Security paper check payments each month, putting their money in danger of check theft and other financial crimes.

Ensuring you get your money the safest way possible is one reason why the U.S. Department of the Treasury is getting rid of paper checks for federal benefits. Payments instead will be made electronically, which eliminates the risk of stolen checks and helps protect you from financial crime.

If you are about to apply for federal benefits, you will receive your payments electronically from day one. If you already get federal benefit payments by check, you must switch to an electronic payment method by March 1, 2013.

Don’t leave your money at risk by waiting for the deadline. It’s fast, easy and free to switch to one of the two electronic payment options recommended by the Treasury Department:

·         Have a bank or credit union account? Sign up to get your money by direct deposit to a checking or savings account. Your federal benefit payment will go straight into your account on payment day each month.

·         Prefer a prepaid debit card? Switch to the Direct Express^® Debit MasterCard^® card. You money will be posted to the card account on payment day each month. You can make purchases and get cash back with purchases at no charge anywhere Debit MasterCard^® is accepted. There are no sign-up fees, overdraft fees or monthly fees. Some fees for optional services may apply. For information on card fees and features, visit www.GoDirect.org. No bank account or credit check needed.

To switch to direct deposit or the Direct Express^® card, contact your federal benefit agency office, visit the Treasury Department’s Go Direct^® campaign website at www.GoDirect.org, or call the U.S. Treasury Electronic Payment Solution Center at (800) 333-1795. For direct deposit to a checking or savings account, you can also make the switch at your local bank or credit union.

Direct deposit offers you theft protection for your federal benefit payments. Don’t wait – make the switch today.

What is the Debt Limit?

What is the Debt Limit?: From the USA.gov Blog:

"The federal government can borrow money to pay its bills, just like taking out a loan. The debt limit is the maximum amount that Congress allows the government to borrow, similar to the credit limit on a credit card. The government will exceed the current debt limit of $14.3 trillion dollars on August 2 unless Congress votes to raise the limit before that date.

Raising the debt limit would let the government borrow enough money to pay bills that it already owes, such as Social Security and Medicare benefits, military salaries, interest on the national debt, and tax refunds. It does not mean that the government has decided to spend more money.

According to the U.S. Treasury, “Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. That would precipitate another financial crisis and threaten the jobs and savings of everyday Americans.”

This isn’t the first time that the government has reached its debt limit. The limit has been raised, extended, or revised 78 times since 1960.

Learn more about the debt limit from the U.S. Treasury.

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How Changes in Michigan Tax Law Affect Michigan Retirees

How Changes in Michigan Tax Law Affect Michigan Retirees: From the Red Tape Blog: "
A new law governing how retirement income will be taxed starting in 2012 sets up a three-tier system, depending on a retiree's age. All three tiers avoid taxing Social Security income and military pensions. For couples, the age of the older spouse applies. Here's how the system works:


• Residents born before 1946 will continue to get the same tax breaks they have now. Public pensions will not be taxed. Income from private pensions, 401(k)s and IRAs will not be taxed on amounts up to $45,120 for single filers and $90,240 for joint filers. This will affect about 480,000 tax returns.


• Residents born between Jan. 1, 1946, and Dec. 31, 1952, will have all retirement income liable to tax, whether it's from a public or private pension, 401(k) or IRA. Exemptions can be claimed for up to $20,000 for a single filer and up to $45,000 for joint filers. Above those levels, retirement income will be taxed at the state income tax rate of 4.35 percent. When these residents turn 67, the $20,000/$40,000 exemption applies to all income, not just retirement income. If household resources exceed $75,000 for a single return or $150,000 for a joint return, the $20,000/$40,000 exemption is eliminated. The exemption also is eliminated if a taxpayer claims a deduction for a military or railroad pension. This will affect about 230,000 returns.


• Residents born after 1952 will see all retirement income taxed as regular income until they turn 67, at which point they'll qualify for a senior income exemption of $20,000 for single filers and $40,000 for joint filers on all income. If household resources exceed $75,000 for a single return or $150,000 for a joint return, the $20,000/$40,000 exemption is eliminated. A taxpayer can forgo the $20,000/$40,000 exemption and instead deduct 100 percent of Social Security income. A taxpayer claiming the $20,000/$40,000 exemption can't claim the deduction for Social Security or the standard personal exemption. This will affect about 150,000 returns.


Sources: Senate Fiscal Agency, Treasury Department



For the full article, see Kathy Barks Hoffmann, 'Michigan pension tax change takes toll on retirees; Critics say it's a shift to help big business', Lansing State Journal, June 6, 2011.

Original post blogged on b2evolution.

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Top 10 Tools and Tactics to Trim Your Bills [Lifehacker Top 10]

Top 10 Tools and Tactics to Trim Your Bills [Lifehacker Top 10]: From Lifehacker: "Cutting down your cellphone, rent, credit card, and other bills is the gift that keeps on giving, all year 'round. Try these negotiation tactics, savings tips, reminder plans, and other tips to cut down your paycheck killers.

Photo by Casey Serin.

10. Double-Check Your Credit Card Statement

When you've automated your finances and feel like you're watching your purchases at the store, it can be easy to overlook the surprisingly frequent purchases you didn't make on your credit card bill. As Consumer Reports points out, it happens all too frequently—even twice in two months. Having to provide a card twice because it "didn't go through" is a red flag, but sometimes stores, restaurants, and online vendors are just overzealous with their charges. (Original post)

9. Reduce Your Rent with a Letter

Rent increases can seem like a fact of life, but if you're in an area hit hard by the real estate downturn, it doesn't have to stick. The Wall Street Journal detailed the efforts by some Manhattan roommates to run the math and reduce their rent with a letter, and it worked to the tune of $300. Your mileage will certainly vary, but if you're consistent with payments and fairly reliable, you don't have to pay more when everyone else is paying less. Photo by Editor B. (Original post)

8. Use Junk Mail to Reduce Your Card Interest

Those dozens, maybe hundreds of credit card offers you get each year, promising that you'll be approved if you even so much as sneeze so it sounds like 'yes'? You can use those offers, and a strategic phone plan supplied by The Simple Dollar blog, to lower your current card's interest rate, if you're having to pay on it every month. Photo by amishsteve.

7. Skip the Dry Cleaning on Certain Clothes

'Dry clean only' is not a hard and fast rule, according to a veteran dry cleaner. For clothing made primarily of polyester and nylon, washing yourself, on a gentle cycle, is entirely do-able, according to EcoSalon's interview with an expert. Cotton, which you'd think could be handled at home, should actually go to the cleaners if the tag says so, to avoid shrinking. Bamboo, too, is a safe DIY cleaning candidate, but ... wait, who owns bamboo-based clothes? Photo by Wm Jas. (Original post)

6. Never Pay Late Fees with Smart Reminders

Paying late fees on bills that merely slipped your mind or missed your desk stinks. There are ways to triple-check you know a bill is due, and they're all free. For bills that offer online payments and email statements, we suggest our set-and-forget system for sorting reminder emails. Personal finance manager Mint.com also offers free email and SMS reminders when bills are due, whether or not you're signed up with the biller itself. Finally, there's 'batching your bills"—calling your billers, asking to reset your billing periods to a common point (the first or 30th, perhaps), and then paying them as they come in. It gives you a clear view of your obligations for the month and fewer mid-month doubts about what you owe. Photo by *_Abhi_*. (Original post (batching))

5. Offer Up-Front Payment to Cut Medical Bills

The billing offices at hospitals, doctor's offices, and insurers are not suffused with an air of optimism. They pretty much expect to hear excuses, hound people, and eventually ring up collections offices. That's why calling them up first thing and offering to pay your bill in full can actually cut real money off the top, according to the NY Times' Bucks blog. Since posting this, we've heard from lots of readers, in comments and email, who succeeded with this tactic. It's one of the most honest savings you'll see in modern times. Photo by ernstl. (Original post)

4. Learn the Art of 'Just Asking'

It seems strange to think that, after you've signed up for a service or started shopping at a store, you can ask them to pay less for something and get that offer. But as Jason found out, there are ways of getting people on the phone, or talking over a counter, and reduce your bills by just asking. In his case, he picked up a serious discount on cable and internet, discovered semi-secret Office Depot sales, found out about customer rewards programs he'd never known about, and even got a larger garbage can at a lower cost. Photo by stopnlook.

3. Track Your Phone's Data Usage and Switch Accordingly

It's been easy to get aggravated at cellular companies for making the switch from all-you-can-eat unlimited plans to measured tiers. Don't they take enough already? But the majority of smartphone users don't use as much data as they think, as Fierce Wireless points out, and would probably save money on a capped plan. How to know if you're in that minority? Use the tools we compiled to monitor your cellphone data usage, whether you're running Pandora while you're driving or doing some occasional tethering. (Original post: tiered pricing)

2. Hit Up BillShrink

They started off by comparing and analyzing cellphone plans for you, which was already helpful and impressive. But now service comparison site BillShrink can tell you the best deal possible on credit cards, television service, savings and CD accounts, nearby gas, and, still, the best cellphone and smartphone service. There's a bit of casual business partner promotion, as you might expect, but BillShrink at least arms you with a realm of options to look through. (Original post)

1. Run Through a Day-Off Checklist of Savings Moves

What if you actually acted on all those things you always say you'd do 'If I had the time'? Better still, what if someone made you a checklist of potential savings to check out, interest rates to boost, credit cards to swap out, and utilities to ring up and ask for a better deal? Ron Lieber made exactly that checklist, and told the story of his productive day off. (Original post)

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What's the best move you've made to save monthly money in the last year? Where did you find not-so-obvious savings inside your services? Spread the wealth in the comments.

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Manage Debt While Saving for Retirement

Manage Debt While Saving for Retirement: From GovGab: "Recently the Oprah Winfrey show featured a multiple part series on debt called Debt Diet. The series emphasizes how Americans are drowning in debt and not saving enough. The show offers an action plan to help families get out of debt. The series follows three families as they wrangle with trying to implement the step by step action plan to reduce their debt.
It is critical that you know how much debt you really have and how much you are spending. If you have too much debt, you need to get your spending under control and manage your credit cards better. It may be a matter of teaching yourself to say “NO” to new purchases and to follow a spending plan. Or, you may need to explore new ways to increase your income.

When you are struggling with debt it is difficult to even think about saving for retirement. In order to have the resources you need later in life, you should begin to set aside resources now. Most people struggle with how much to save now, so they will be in good financial shape 20-30 years into the future. It may seem a bit like guessing or magic, but there are tools to help you estimate how much you will need. Social Security Online offers an estimate your retirement benefits calculator. There are other retirement calculators, as well.

Here are some additional resources to help you manage your debt and increase your savings:

• Dealing with Debt Videos
• Knee Deep in Debt – Facts For Consumers
• Money and Credit 101
• Money Matters
• Mymoney.gov Managing Debt and Credit
• Retirement Savings Education Campaign

Are your “get out of debt” strategies working for you? When it comes to retirement planning, do you think you are saving enough?"

Consider Economies of Scale When Evaluating Money Saving Tips and Tricks [Saving Money]

Consider Economies of Scale When Evaluating Money Saving Tips and Tricks [Saving Money]: From LifeHacker:
"Often people are quick to dismiss the benefits of frugal behavior modifications and decisions that yield only incremental savings. Factor in the economy of scale for the changes you're making to see the true savings.

Joe Shlabotnik [via ]

Over at the financial and frugality blog The Simple Dollar they took a hard look at how to judge whether a frugal change in your life actually yields a return and how you shouldn't dismiss small amounts of savings that add up over time. They examine various examples of saving money and how that stacks up over years, including simple things like making your own breakfast:

Take my homemade breakfast burritos. The procedure for making breakfast burritos takes about an hour and each burrito has about seventy cents worth of ingredients in it. In terms of one burrito, it's not a bargain at all – you can get a breakfast burrito for $2 pretty easily (although I think mine tastes better). However, the recipe makes thirty two burritos at once – you can then store them in the freezer for future use. This cuts the time commitment per burrito to less than two minutes, meaning that your hourly rate after taxes for making the burritos is somewhere on the order of $39.

You can also apply this type of thinking to projects that don't require continual renewal like the one time installation of a programmable thermostat. It might take you an hour to install it if you've never installed a thermostat before but over the first five years of ownership you can save hundreds of dollars in heating and cooling bills. The small initial cost of the thermostat combined with a small amount of your labor, multiplies over time to make the value of that single hour of labor worth significantly more than the initial investment.

Check out the full article at The Simple Dollar to see more examples of how economy of scale can turn small changes into large savings over the long term. Have examples of changes you've made in your own life that decrease your monthly expenses? Let's hear about it in the comments.

Is a Frugality Tip That Saves You a Quarter a Waste of Time? Some Notes on Economies of Scale [The Simple Dollar]

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TurboTax Re-Opens Free Tax Question Promotion [Taxes]

TurboTax Re-Opens Free Tax Question Promotion [Taxes]: From LifeHacker

"Tax season—it's coming up sooner than you think. If you've got any questions on your personal, federal income taxes, the folks behind TurboTax will once again call you back with a free answer between now and Jan. 31.

Just as with last year, actual humans affiliated with Intuit's TurboTax software and web applictions will answer questions left on their FreeTaxQuestion.com site, calling back within 24 hours. There's a limit of one question per person during the promotion, running through Jan. 31, and it only applies to federal taxes, not state-specifically Forms 1040 (personal) and 1065, 1120, or 1120S (business). You can leave your question from 8 a.m. to 5 p.m. Pacific time.

You will, of course, likely get a soft push toward TurboTax services, and questions beyond specific, technical issues should probably go to an accountant. That said, it's still a nice little freebie for a little piece of mind, and a good number of commenters were pleasantly surprised with their results last year.

Ask a Tax Expert Promotion

Maintain a Good Credit Score with the 20-Percent Rule [Money]

by Azadeh Ensha of Lifehacker:

Maintain a Good Credit Score with the 20-Percent Rule [Money]: "

Getting and keeping a good credit score is important in renting an apartment, buying a home, and most other finance-based ventures. CNN Money offers their best tips on how to maintain a FICO score, including the 20-percent rule.

Photo by Andres Rueda.

The article explains that how much you owe versus how much credit has been extended to you is the second most important factor in determining your score. By way of example, the author writes that if you've charged $5,000 on credit cards and have $50,000 in credit, your rate is 10 percent, which they say is "ideal"—though you can go up as far as 20 percent and still keep a good score. Once you consistently go over 20 percent, you begin to ding your credit score.

If you're lucky, you hardly ever carry over a balance on your credit card to begin with, but in case you've accrued a bit of debt, this is information worth knowing. Check out the link for the other credit tips, then watch our video covering ten credit score myths dispelled.

Win at the Credit Scoring Game [CNN Money]

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