Archive for May 2011

By Jim Sloan

Credit cards come with all kinds of special features these days--zero interest balance transfers, free money rewards and even cash back promotional offers.

But many credit cards also often come with some kind of extended warranty for products you purchase with the card. What this means, usually, is that the credit card company will extend the terms of the original manufacturer's warranty for a period of time equal to the original warranty up to one year. Some extensions are only for six months, however.

In other words, if you purchase something with a 90-day manufacturer warranty on one of your zero percent credit cards that offers an extended warranty, you will enjoy a 180-warranty period. If you buy something on that card with a five-year warranty, you'll have six years of coverage.

The credit card's responsibility for covering your purchase only kicks in after the original manufacturer's warranty runs out.

Many people confuse extended warranties with things called "service contracts." Service contracts are a repair program you purchase from a store or a manufacturer which ensures that if your purchase breaks--either through faulty construction or because you brought your laptop into the bath with you and it got wet--it will be repaired or replaced free of charge.

Credit card warranty extensions are not service plans. Credit card warranties typically only cover defects in materials or workmanship; they won't protect you if you shower with your Macbook Pro.

By Maryalene LaPonsie

Remember when you couldn't go to the grocery store and buy a gallon of milk unless you had a couple dollars in your pocket? The move toward plastic started with gas stations and grocery stores, but for me, the defining moment came when I no longer had to worry about scrounging for change to buy breakfast on my way to work. Yes, one day - one glorious day - the clouds parted and the heavens sang and the fast food joints in the town began accepting credit cards.

So today you can buy everything from a 79 cent pack of gum to a $7,900 diamond bracelet with a little help from Visa, Mastercard and company. But should you?

While it may be convenient, there are 5 things you should avoid charging to your credit card:

Groceries: OK, if you are out of diapers and out of cash, it might be better to use credit than wrap little Johnny in a towel and hope for the best. But if you find yourself in a situation where you are charging groceries every week because you don't have any other way to pay, it is time to take off the rose-colored glasses: You have a problem. You need to figure out a way to spend less or earn more.

Now, the exception to this rule would be if you use one of the best cash back credit cards and pay off your balance each month. With zero percent credit cards and cash rewards, you can actually come out ahead so long as you don't carry a balance. Otherwise, you might be paying interest on those diapers for the next five years if you start making only...

By Richard Barrington

Taxes are such a hot-button topic that even the language of taxation is sensitive. What sounds like tax reform or simplification to some people comes off as code for tax increases to others.

Differences over tax policy are more than just perception, because there will be winners and losers from any changes in the tax code. In fact, because of the huge national debt, tax changes are a less-than-zero-sum game, meaning that winners and losers won't cancel each other out: when all is said and done, there will be a net price to pay in order for federal income taxes to address the national debt.

Prominent tax proposals

There are endless possibilities for federal income tax reform, but here are three major themes:

1. Simplification of the federal income tax code. This means getting rid of loopholes in the corporate tax code, and reducing the number of tax deductions available to individuals.
2. Adjusting federal tax brackets. An oft-mentioned trade-off for reducing loopholes and individual deductions is that it would enable tax rates to be lowered in at least some federal tax brackets. This was the essence of the Reagan tax reforms in the 1980s - tax rates were lowered in exchange for simplification which reduced many loopholes and deductions.
3. Raising taxes on high incomes. Traditionally, taxpayers with the greatest

By Kathryn Hawkins

When you sign up with a bank, you may think you're protecting your money--but in many cases, financial institutions implement fees and other charges that can chip away at your hard-earned savings.

Here are 7 ways to beat the banks and manage your financial life to save as much as possible:

1. Plan a budget based on your monthly income. Take note of how much you bring in each month and your various expenses, such as rent or mortgage, food, car payments, and entertainment. Then set up a chart to determine the maximum amount that you should spend on each expense category based on how much you make.
   
   If you find yourself going into overdraft or relying on credit cards to make payments, modify your spending habits so that you can live within your budget, whether that means getting a roommate or brown-bagging your lunch a few days a week.


2. Pay yourself first. Automatically transfer money from your checking to your savings account immediately after you deposit your paycheck. If you have extra cash, don't just let it sit there in your checking account--move it to a savings account, where it can accrue interest. Many savings accounts will gain over 1 percent per year--so if you have a balance of $5,000, you could make an extra $50 a year just for moving your money into one of the best high-yield savings accounts.


3. Sign up for minimum balance alerts. Many banks offer free services unless your account balance goes below a certain limit--in many cases, around...

By Jim Sloan

More than a few of us have felt our jaws drop when opening a bill from one of our credit card companies.

Maybe you were shocked to see that your interest rate had jumped on your zero percent credit cards or that there were fake credit card numbers on your bill. Or maybe those balance transfer offers were not as good as you thought, or that best cash back credit card you got didn't reward you the way you expected it to.

Chances are the details were outlined to you in the fine print of your credit card application. But if these surprises weren't included in that disclosure and that the charges are unfair or unjust, you do have the right to complain about your credit card company to a state agency or the federal government.

The first step

Before reporting your credit card company to your state or federal agencies, try to work out your differences with the company itself. Call and explain your problem to them and ask about what procedures you should follow to correct the problem.

If that doesn't help, you can file...

By Jim Sloan

Although the interest rates banks are paying these days are painfully low, students and others just out of college should consider opening a rewards checking account. Rewards checking accounts offer some of the highest rates around, and the little extra you can earn in interest with one of these accounts can go a long way when you're just starting out.

Rewards and returns

Rewards checking accounts pay interest on your balances up to a certain level but require that you meet certain levels of account activity.

According to USA Today, rewards checking accounts are often a better investment than certificates of deposit, which lock up your money for a set term. Also, these checking accounts often give you better access to your cash than even the best savings accounts or money market accounts. Interest checking accounts provide an incentive to save and are a great way to get established and handle most of your day-to-day financial needs.

Good interest checking accounts can be found with many of the best online banks. But in addition there are often excellent interest rates paid for rewards checking accounts with smaller local banks and credit unions.

Terms to be aware of when comparing rewards checking accounts

One of the best checking offers available these days comes from Consumers Credit Union...