A Financial Port in Any Storm

Finance
“When you’re dying of thirst, it’s too late to think about digging a well.” -Japanese Proverb The waters are receding slowly, but the images of post-apocalyptic devastation remain in the mind’s eye.  It is too late for the victims of Hurricane Sandy, but what can we do to prepare ourselves financially for such a disaster that may strike with little notice? Prepare for the emergency itself:  From an investment viewpoint, cash may be “trash” these days, but you need to have some handy to pay for necessities when ATMs are down and credit cards are not accepted.  Keep a few “Benjamins” or as many “Presidents’’ as you can afford to stash away in a safe, accessible place.  Choose a spot you can get to quickly when all hell breaks loose,…
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Renter Nation – Redux

Finance, Life & Community
We are aware that as a result of the recession, more people are choosing to rent rather than buy homes.  What may come as a surprise is that there is an emerging trend towards renting not just homes, cars, and movies, but other items like phones and even children’s toys. Renting is not just for the poor anymore: The stigma of renting is lessening as more of the 20- and 30-somethings impact the consumer market.  Partly due to the uncertain job market, high student loans, and the need to be able to pick up and move quickly, more are opting for the flexibility of living a minimalist lifestyle. Why buy that designer dress you want but may use only once when you can rent it for the day? “I want…
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I Love Rock n’ Rollovers

Finance
People are starting to find jobs now, slowly but surely.  So, after signing their employment forms, dusting off their desks, and arranging their photographs, the last thing on their minds are their orphan 401(k) or 403(b) accounts.  Often, these balances are left behind at former employers, and soon forgotten. As hard as it may be to be reminded of your former employer, it is best to act right away to establish control over your retirement assets.  Here are several options to consider. Cash Out We strongly advise against this option. You will be subject to ordinary income tax rates on the entire balance. And, if you are under age 59 ½, you will also have to pay a penalty tax of 10% on these balances.  If your past employer requires…
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Rising College Cost are as Certain…

Finance
The only thing certain is death and taxes, you say?  I say it is the rising cost of college.  Tuition costs have grown exponentially, by some counts as much as four times the rate of inflation over the last 25 years. So parents-to-be should be stashing away for college almost as soon as that gleam in the eye becomes a reality. States across the union have established various tax-advantaged ways (529 plans) in which to save for your child’s college education.   But like everything else, there are choices and some confusion about which plan is best for you.  Below is a summary, but additional information is available at www.misaves.com, or www.savingforcollege.com, among others. Prepaid versus Flexible Plans Prepaid plans like the Michigan Education Trust (MET) allow you to buy college…
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Hard times still call for insuring our children

Finance, Life & Community
For years, Detroiters have seen our children gunned down in the streets or killed for senseless reasons. Through death after death, we have watched crying families on television being interviewed by news anchors pleading with the public to help pay for funeral costs. Many families are not able to have a funeral immediately and have to scrape up money to help with the expenses. We are in danger of becoming numb to the rampant deaths plaguing our city. It was not the drive-by shootings or other gang-related killings, or the deaths related to breaking and entering, that caused me to realize that parents need to legally protect their children by purchasing life insurance policies. It was Nicole Turner’s story of her 11-year-old son suddenly dying while playing video games that…
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Make EITC Payments Automatic: A Plea to President Obama On Behalf of Working Families

Finance, Opinion
For years now, I’ve been advocating the need to make Earned Income Tax Credit (EITC) payments to Poor & Working Families automatic. President Bush did this a few years ago when practically every American got a check in the mail for $600 as the first round of economic stimulus. This time, President Obama should target only those U.S. families with an income under $42,000 per year and are deemed eligible for EITC (go to www.irs.gov/eitc for more info).  The federal budget for EITC is about $40 billion per year, so this is revenue neutral---no new money is needed to fund this benefit. Typically, seven million Americans leave over $7 billion on the table because they do not file for EITC. Be the blessing and remind all of your relatives and…
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