February 17, 2015

What If It’s Not Working?

Credit: jesadaphorn at FreeDigitalPhotos.net
Money comes, money goes. You get paid. Wahoo! Then the cable bill comes... Then the phone bill... Then the water bill, power bill, car payment, and house payment all come on one, lovely day. @#$%! This is the month when homeowner’s insurance premiums come in? Did you forget about that? (I know I did!) Wow. There’s just not that much more left than before you and I got paid! And we’re supposed to go to that new, pricey restaurant this weekend with our friends… Do you ever feel like this? I think most people do.

So what should you do when it’s not working? You’re certainly working hard, and you’re reading all of those helpful financial blogs every time your friend pumps one out (hopefully), but your financial situation is just not improving that much. What should you do? In three words:

Try something different.

If you’re having trouble saving money, open a second cash account and direct deposit a portion from each pay check into it. Pretend it’s another one of those deductions on your check no one really understands, and I bet your cash will finally build!

If you’re having trouble paying down your credit card debt or you keep “overusing” your debit card, play rock, paper, scissors with your plastic cards and go with scissors! Cut them up into a lot of pieces (to help reduce the chance of identity theft), and try using cash. When you see how many pictures of Andrew Jackson or Benjamin Franklin something takes, it may feel different and help your self-restraint.

If you’re having trouble actually increasing your contributions to your retirement plan at work, think Nike - just do it! As long as your increased contribution isn’t horribly unreasonable, you’ll probably naturally figure out how to make your reduced income work once you have less income actually coming in.

The one I’ve actually seen a lot of lately is someone trying to do too many good things at once. I admire people who do this, but let’s be realistic; you can’t boost cash, pay down debt, save for a new car, save for a new house, save for your kid’s college, save for your kid’s wedding, and save for that long overdue dream vacation all at the same time. I mean you could, but unless you’re making really big money, that “shotgun approach” isn’t going to work. Based on my experience, most people taking the “shotgun approach” end up feeling like they aren’t making any progress, get frustrated, and then return to spending what they make. Instead, I’d suggest that you go with a “surgical strike approach,” and go after one or only a few items at a time. Boost cash, then pay down debt while keeping your cash up. Save for a car, buy a car, and then save for the new house. This way you will feel like you are making financial progress because you are accomplishing something that is tangible and observable. Things will get checked off your list, and you may find that your rate of financial progress seems to pick up momentum.

If what you are trying to do financially isn’t working, don’t feel bad. When talking about his many attempts to invent the lightbulb, Thomas Edison said that he had not failed, he’d just found 10,000 ways that didn’t work! Edison also said, “Our greatest weakness lies in giving up. The most certain way to succeed is always just to try one more time.”

If you don’t want to listen to this Thomas, that’s fine, but please listen to Thomas Edison. Try one more time!

-Tom

February 10, 2015

Scams Not to Fall For

Credit: Stuart Miles
A couple of weeks ago I got a call from a blocked phone number. I was curious (despite knowing what curiosity does to felines), so I decided to answer. There were lots of voices in the background and even a few phones ringing, but my caller gruffly asked if he had reached my residence. When I confirmed he had, things got real.

Muffled Voice: “This is the United States Treasury Department, and we are calling to notify you that you have several years of back taxes coming due.”
Me: “Really? I’m surprised to hear that. What tax years are in question?”
Muffled Voice: “You have several years of back taxes coming due, and you need to make a payment or face a lien on your property. You can pay now by credit card or wire transfer.”
Me: “That’s not going to happen. To which IRS Center should I make my payment (yep, that was a CPA joke)?”
[Click]



That call was a pathetic fraud, but I can see how it could scare someone who did not have their wits about them into divulging personal information and maybe even giving out a credit card number. Luckily, I didn’t fall for that farce (that is evidently still going on), but too many people have fallen victim to many similar scams. Today, I thought I’d give you a heads up on some of the latest scams that are out there.
  • Scam #1: Congratulations! You’ve won a sweepstakes or random drawing, but there’s just one thing, you’re pretty sure you didn’t enter. Once they ask you for banking information so they can withhold the proper taxes and send you your winnings, go ahead and wish them an unpleasant day.
  • Scam #2: You’ve won a free cruise or a vacation? I doubt it. Once they ask you for personal information so you can claim your prize and await further instructions, go ahead and hang up. Cruise on to whatever else you had planned for the day.
  • Scam #3: You get a call from a “friend” telling you one of your family members is in jail. This is evidently a favorite to use on grandmas whose grandsons are in jail and are “too embarrassed” to call their parents. Please don’t wire any bail money and promise to keep it a secret…
  • Scam #4: If you frequently sell things online personally or as part of your business, and someone sends you a check that is larger than your agreed upon price and they ask you to just send them the difference back, I hope you hear the alarm bells. They’re probably trying to get the difference from you in real money and leave you with a not-so-real check!
  • Scam #5: Would you like to buy this widget at a discounted price that’s only available for a limited period of time? I hope you don’t, but if you do, I hope you wouldn’t be so easily pressured into quickly handing over your personal and financial information.
  • Scam #6: Would you like to make a donation to the United Thieves of the Southeastern United States to benefit those who suffer from Antarctican Measleitis (asked in a super sweet voice)? With apologies to those who suffer from Antarctican Measleitis, no! Stick to the charities and causes you know. Your support is very much appreciated.
  • Scam #7: You get an email from one of your friends (whose email address has been hacked) telling you they randomly took an international trip, are in trouble, and need money. First, how many people take random international trips? Second, if your friend took a random trip to Mozambique without telling you they were going, aren’t you a little peeved? Why would you send them money? Third, call your friend, and see if they are okay. I’d be willing to bet they are, and whatever you do, don’t click the link!
  • Scam #8: You’re staying in a nice hotel, it’s kind of late in the evening, and you get a call from “the front desk” letting you know there was a glitch with the computer system and they lost your credit card information on file. They either need you to come down with your card or go over your information with them over the phone. You’re tired and tying your shoes again seems like a more significant inconvenience than it probably should, so you might be tempted to give your name as it is written on the card, your credit card number, expiration date, and the 3- or 4-digit security code. Don’t do it! It’s probably not the front desk of the hotel. Much more likely, it’s the guy two people behind you when you checked in who heard your last name and room number when the clerk wished you a nice stay!

I believe there really are a lot of good people out there in today’s world, but unfortunately, there are some real stinkers, too. There are some very sick and evil people who prey on the na├»ve, the lonely, and the elderly. Sadly, they are somewhat successful at it. Please be smart. Don’t give anyone anything unless you’re sure they are who they claim. Ask them questions they should be able to answer. Call them back on phone numbers you look up and email them back at email addresses you search for to test them.

Don’t fall for these scams. Don’t let your friends fall for them either.

-Tom