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Bad Spending Habits That Can Be Corrected

July 28th, 2014 | No Comments | Posted in Financial News

A little frugality may lead to a lot of financial progress.

shutterstock_43188082Americans have a great deal of disposable income relative to many other nations, yet our free spending can take us further and further away from the potential for financial freedom. Some people fall into crippling spending habits and injure their finances as a consequence.

Bad habit: failing to save. Saving – saving even $50 or $100 a month – isn’t that hard under most financial conditions. Even so, some households don’t put much of a priority on building a cash reserve of some kind, a portion of which could be used for equity investment.

When you don’t make saving a goal, you don’t have any money to withdraw in a pinch – so if you need to get ahold of some money, where do you find it? Basically, you have three options. One, turn to friends or Mom or Dad. Two, divert money that would go toward a core need (food, rent, the heating bill) toward the sudden crisis. Three, charge your credit card. (There are other options, but they are best not explored.)

Good habit: save just a little, then a lot. You can start a savings campaign by saving “invisibly” – that is, just spending $10 or $15 or $20 less on a regular expense each month. Maybe two or three, even. That’s less than a dollar a day per expense. When your earnings climb further above your financial baseline, you can increase the amount you save/invest.

Bad habit: buying things on a whim. The correlation between impulsive spending and credit card use isn’t too hard to spot. Spending money you don’t have on material items that will soon depreciate doesn’t put you ahead financially.

Good habit: set a budget when you shop. As you arrive at the market, the mall or the local power center, arrive with a limit on what you will spend on that shopping trip and stick to it. Take an hour (or a day) to mull over any big buying decisions – are you buying something you really need? Lastly, use cash whenever you can.

Bad habit: living on margin. Living above your means, charging this and that credit card – this is a path toward runaway debt. You may look rich, but you’ll carry a big financial burden that risks being “out of sight, out of mind” in between credit card statements.

Good habit: strive for lasting affluence, not temporary bling. Possessions symbolize wealth to too many Americans. Real wealth is measured in accumulated assets. They aren’t usually visible, but you can count on them in the future, in contrast to ever-depreciating luxury goods.

Bad habit: buying unnecessary services. Cable subscriptions, extended warranties, service contracts for highly reliable items, health club memberships that translate into little more than an alternate place to shower – they all add up, they all siphon some of our dollars away each month. In many cases, we pay for options rather than necessities.

Good habit: evaluate who benefits most from those services. Are they benefiting the provider more than the consumer? Are they entrees to a “main course” – a steady, long-range financial exploitation?

Go against the norm – it might leave you a little wealthier. In April, Gallup found that 62% of Americans liked saving money more than spending it. Just 34% liked spending more than saving. This appreciation of frugality is relatively new. As recently as 2006, 50% of Americans told Gallup that they enjoyed saving more than spending with 45% preferring spending.1

If we love saving money, a key statistic doesn’t reflect it. According to the Commerce Department, the typical U.S. household was saving 4.8% of its disposable personal income in May. The personal savings rate for 2013 was 4.5%, the least in any year since 2007. Compare that to 6.7% across the 1990s, 9.3% across the 1980s and 11.8% during the 1970s.1,2

Perhaps many of us want to save but can’t due to financial pressures. Perhaps the economic rebound is encouraging personal consumption over saving. Whatever the reason, Americans on the whole don’t seem to be saving very much. That’s the status quo; going against it might help you build wealth a little more easily.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

1 – gallup.com/poll/168587/americans-continue-enjoy-saving-spending.aspx [4/21/14]
2 – bea.gov/newsreleases/national/pi/pinewsrelease.htm [6/26/14]

Protect Your Car From Vehicle Theft

July 28th, 2014 | No Comments | Posted in Lifestyle

shutterstock_152527646Summer is here, which means vehicle theft is in full swing. According to the FBI, July and August are the top two months for vehicle thefts in the country. More than 715,000 vehicles were stolen and about $4.3 billion was lost to motor vehicle theft in 2011. Below are some tips to help reduce the risk of your car being stolen.

  • About 40-50 percent of vehicle theft is due to driver error, which includes leaving the keys in the ignition, keeping doors/windows unlocked and leaving sunroofs open.
  • Never leave your can running and unattended, even if it is just for a few minutes.
  • Try to park in well-lit, public areas.
  • Have you vehicle identification number etched into each piece of glass. This may deter an auto thief because of the time and money involved to replace the glass to remove the car’s identity.
  • If your car does not come with an alarm system, consider installing one. Display an alarm decal near the door handle.
  • If you park in a garage, take the ticket with you. It’s the thief’s ticket out of the garage too.
  • If you take your car for repairs or use valet parking, only leave the ignition key. Make sure no identifying information is attached to the key.

According to the Insurance Information Institute, about one-third of a typical comprehensive auto insurance premium goes to pay for auto theft claims. A car is one of the most expensive pieces of personal property you own so it is worth taking a few additional steps to protect it.

 

July 2014 – Monthly Economic Update

July 28th, 2014 | No Comments | Posted in Monthly Economic Update

July 2014 - Monthly Economic Update

Drivers Beware of This E-ZPass Scam

July 28th, 2014 | No Comments | Posted in Lifestyle

zpass

As if driving on toll roads wasn’t already an annoying experience, drivers now have to watch out for a scam targeting E-ZPass users. The Metropolitan Transit Authority of New York (MTA) issued a warning to toll-road travelers to watch out for an E-ZPass phishing scam that popped up recently: It’s an email to consumers saying they haven’t paid a toll and need to rectify the debt as soon as possible.

How to Spot a Scam

Phishing is an identity theft strategy in which scammers impersonate a seeming legitimate company or person in an attempt to have you divulge your personal information or account credentials that can then be used by thieves to hijack your accounts. Email is essentially the master key to your life – bank accounts, social media and personal interactions – which is why it’s such a coveted target for identity thieves.

The fake E-ZPass email looks like it comes from the company (the bottom even shows a link to its phishing policy, next to its privacy policy and terms and conditions), and it asks the recipient to download the invoice for his or her unpaid toll. It’s pretty convincing, and if you’re the kind of person who gets flustered by a notice of outstanding debt, it’s easy to feel like you should download the bill and take care of it ASAP.

The real E-ZPass doesn’t send emails to people if they miss tolls. The same is true for a lot of companies following up on debts (like the Internal Revenue Service, for example), so if you receive an email asking you to pay up, you should call customer service before clicking anything.

What to Do If You’ve Been Hacked

If you fall victim to one of these charades, take immediate action to shield your identity. Start by resetting your email password, enable multi-factor verification if you haven’t yet done so, then update login credentials to other sites, like your bank accounts and social media accounts. A strong password is important, but it won’t do much if someone gets access to it or if you use it across multiple accounts. Here are some tips on creating strong passwords.

Preventing identity theft is very difficult, which is why you need to fine-tune your damage-control plan. Monitor your accounts for unauthorized activity by checking your transactions regularly (daily, if possible), and check your credit scores for sudden changes, which can be indicative of fraud. You can get your free credit data through Credit.com, and you should also review your credit reports, which you can get for free once a year.

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30 Gorgeous Travel Locations: Most-Pinned Places on Earth

July 28th, 2014 | No Comments | Posted in Lifestyle

As kids we tore breathtaking photos from travel magazines and glued them into scrapbooks or threw them on our walls. Today we share those photos on Pinterest, no glue sticks required. Though the medium has changed, the sentiment is the same— we’ve got serious wanderlust.

Pinterest shared with Mashable the top most-pinned places on Earth. And while some are instantly recognizable (hello, Big Ben!), others, like Canada’s Abraham Lake, are lesser known.

1. Paris, France

Paris-france
Image: Flickr, Moyan Brenn

2. Eiffel Tower, Paris, France

Eiffel-tower
Image: Flickr, Yann Caradec

3. London, England

London
Image: Flickr, Lies Thru a Lens

4. New York City, U.S.A.

New-york-city
Image: Flickr, Aurelien Guichard

5. Abraham Lake, Canada

Abraham-lake

6. The Blue Lagoon, Iceland

Blue-lagoon-iceland
Image: Flickr, Ben124.

7. Amsterdam, Netherlands

Amsterdam
Image: Flickr, megoizzy

8. Central Park, New York

Central-park
Image: Flickr, edmenendez

9. Taormina, Italy

Taormina-italy
Image: Flickr, Mathieu Dessus

10. Venice, Italy

Venice
Image: Flickr, trishhartmann

11. Glacier National Park, Montana

Glacier-national-parlk
Image: Flickr, backpackphotography

12. Rome, Italy

Rome
Image: Flickr, Bert Kaufmann

13. The Crags, Australia

Crags
Image: Flickr, Robert Hoge

14. The Caves Resort, Jamaica

Negril-jamaica
Image: Flickr, Abir Anwar

15. Barcelona, Spain

Barcelona
Image: Flickr, Bert Kaufmann

16. Ennis Bluebonnet Festival, Texas

Bluebonnets
Image: Flickr, Robert Hensley

17. Brooklyn Bridge, New YorK

Brooklyn-bridge
Image: Flickr, slowpoke748

18. Musée du Louvre, Paris, France

Louvre
Image: Flickr, Problemkind

19. Prague, Czech Republic

Prague

20. Viewpoint Ingang Jachthaven Reitdiep, Groningen, Netherlands

Gronigen
Image: Flickr, XPeria2Day

21. Bagan, Mynamar

Bagan
Image: Flickr, Stefan Munder

22. Big Ben, London

Big-ben
Image: Flickr, robmcm

23. Budapest, Hungary

Budapest
Image: Flickr, Maurice

24. Westminster Abbey, London

Westminster-abbey
Image: Flickr, Mark Ramsay

25. Portknockie, Scotland

Portknockie
Image: Flickr, Deborah Main

26. Istanbul, Turkey

Istanbul
Image: Flickr, Robert S. Donovan

27. Santorini, Greece

Santorini
Image: Flickr, Pedro Szekely

28. Florence, Italy

Florence
Image: Flickr, Chris Yunker

29. Yosemite National Park, California

Yosemite
Image: Flickr, docentjoyce

30. Masjid Putra, Malaysia

Malaysia
Image: Flickr, KELANTAN JOTTINGS

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10 Things Millennials Won’t Spend Money On

July 28th, 2014 | No Comments | Posted in Lifestyle

By 2017, millennials will have more buying power than any other generation. But so far, they’re not spending like their parents did.

shutterstock_145756319Millennials are often maligned for their lack of financial literacy, but there is one money skill the younger generation has in spades: saving. After growing up during the Great Recession, millennials want to keep every cent they can. (If you don’t believe us, just check out this Reddit Frugal thread inspired by our recent post on millennial retirement super-saving.)

This generation may be way ahead of where their parents were at the same age when it comes to preparing for retirement, but the frugality doesn’t end there. Kids these days also aren’t making the same buying decisions our parents made. Here are 10 things that a disproportionate number of today’s young adults won’t shell out for.

The average American still consumes 71% of his or her media on television, but for people age 14-24, it’s only 46%—with the lion’s share being consumed on phone, tablet, or PC. Many young people aren’t getting a TV at all. Nielsen found that most “Zero-TV” households tended toward the younger set, with adults under 35 making up 44% of all television teetotalers.

Millennials aren’t the only ones tuning out the tube. In 2013, Nielsen reported aggregate TV watching time shrank for the first time in four years.

2. Investments
By all accounts, young people should be investing in equities. Those just entering the work force have plenty of time before retirement to ride out market blips, and experts recommend younger investors place 75% to 90% of their portfolio in stocks or stock funds.

Unfortunately, after growing up in the Great Recession, millennials would rather put their money in a sock drawer than on Wall Street. When Wells Fargo surveyed roughly 1,500 adults between 22 and 32 years of age, 52% stated they were “not very” or “not at all” confident in the stock market as a place to invest for retirement.

Of those surveyed, only 32% said they had the majority of their savings in stocks or mutual funds. (Too be fair, an equal number admitted to having no clue what they were invested in, so hopefully their trust fund advisors are making good decisions.)

3. Mass-Market Beer
Bud. Coors. Miller. When parents want a drink, they reach for the classics. Maybe a Heineken for a little extra adventure. Millennials? Not so much. When Generation Now (thank god that moniker didn’t catch on) wants to get boozy, the data says we prefer indie brews.

According to one recent study, 43% of millennials say craft beer tastes better than mainstream beers, while only 32% of baby boomers said the same. And 50% of millennials have consumed craft brew, versus 35% of the overall population. Even Pete Coors, CEO of guess-which-brand, blames pesky kids for his beer’s declining sales.

4. Cars
Back when the Beach Boys wrote Little Deuce Coupe in 1963, there was a whole genre called “Car Songs.” Nowadays you’d be hard pressed to find someone under 35 who knows what a “competition clutch with the four on the floor” even means.

The sad fact is that American car culture is dying a slow death. Yahoo Finance reports the percentage of 16-to-24-year-olds with a driver’s license has plummeted since 1997 and is now below 70% for the first time since Little Deuce Coupe’s release. According to the Atlantic, “In 2010, adults between the ages of 21 and 34 bought just 27 percent of all new vehicles sold in America, down from the peak of 38 percent in 1985.”

5. Homes
It’s not that millennials don’t want to own homes—nine in ten young people do—it’s that they can’t afford them. Harvard’s Joint Center for Housing Studies found that homeownership rate among adults younger than 35 fell by 12 percent between 2006 and 2011, and 2 million more were living with Mom and Dad.

It’s going to be a while before young people start purchasing homes again. The economic downturn set this generation’s finances back years, and reforms like the Dodd-Frank Act have made it even more difficult for the newly employed to get credit. Now that unemployment is decreasing, working millennials are still renting before they buy.

6. Bulk Warehouse Club Goods
This one initially sounds weird, but remember: millennials don’t own cars or homes. So a Costco membership doesn’t make much sense. It’s not easy to bring home a year’s supply of Nesquik and paper towels without a ride, and even if you take a bus, there’s no room to stash hoards of kitchen supplies in a studio apartment.

Responding to tepid millennial demand, the big box giant is trying to win over youngsters by partnering with Google to deliver certain items right to your home. However, even Costco doesn’t seem all that excited about its new strategy.

“Don’t expect us to go to everybody’s doorstep,” Richard Galanti, Costco’s chief financial officer, told Bloomberg Businessweek. “Delivering small quantities of stuff to homes is not free. Ultimately, somebody’s got to pay for it.”

7. Weddings
Getting hitched early in life used to be something of a rite of passage into adulthood. A full 65% of the Silent Generation married at age 18 to 32. Since then, though, Americans have been waiting longer and longer to tie the knot. Pew Research found 48% of boomers were married while in that age range, compared to 35% in Gen X. Millennials are bringing up the rear at just 26%.

Just like with homes, it’s not that today’s youth just hates wedding dresses—far from it. Sixty-nine percent of millennials told Pew they would like to marry, but many are waiting until they’re more financially stable before doing so.

8. Children
It’s hard to spend money on children if you don’t have any.

After weddings, you probably saw this one coming, but millennials’ procreation abstention isn’t only because they’re not married. Many just aren’t planning on having kids. In a 2012 study, fewer than half of millennials (42%) said they planned to have children. That’s down from 78% 20 years ago.

Stop me if you heard this one: it’s not that millennials don’t want children (or homes, or weddings, or ponies), it’s that this whole recession thing has really scared them off any big financial or life commitments. Most young people in the above study hoped to have kids one day, but didn’t think their economic stars would align to make it happen.

9. Health insurance
According the Kaiser Family Foundation, adults ages 18 to 34 made up 40% of the uninsured population in the pre-Obamacare world. Why don’t young people get health coverage? Because they’re probably not going to get sick. This demographic is so healthy that those in the health insurance game refer to them as “invincibles.”

Since the Affordable Care Act, more millennials are gradually buying insurance. Twenty-eight percent of Obamacare’s 8 million new enrollees were 18-34 year-olds. That’s well short of the 40% the Congressional Budget Office wanted in order to subsidize older Americans’ plans, but better than the paltry number of millennials who signed up before Zach Galifianakis got involved.

10. Anything you tell them to buy
When buying a product, older Americans tend to trust the advice of people they know. Sixty-six percent of boomers said the recommendations of friends and family members influences their purchasing decisions more than a stranger’s online review.

Most millennials, on the other hand, don’t want their parent’s or peer’s help. Fifty-one percent of young adults say they prefer product reviews from people they don’t know.

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7 Creative Ways to Organize Your Mobile Apps

July 28th, 2014 | No Comments | Posted in Lifestyle

Try to find the Notes app on your phone.

If you’ve spent more than a minute hunting for this across your home screens, you may want to consider organizing your smartphone for easy access.

With thousands of apps at our fingertips, they can quickly overcrowd our screens. Apps are designed to improve our lives and make us more efficient, but trying to find them in a mishmash collection of colorful icons can be time-consuming.

Solve this problem by taking 15 minutes to clean out the jumble of app clutter, and find an organizational structure that works for you. After all, no one wants to be an app hoarder.

Here are seven creative ways to arrange your smartphone apps.

1. Verb-based folders

iPhone app folders categorized by verbs
For some people, default category names such as “Productivity,” “Reference” and “Utilities” are too vague.

Instead, take a second to think about what you use your phone for. Do you watch videos on YouTube? Listen to music? Read the news? Labeling folders with verbs such as “watch,” “play” and “learn” can help you jump to the app you’re looking for infinitely faster.

2. Color coding

iPhone apps arranged by color
Color coding isn’t just for notes, emails and closets.

An app icon’s visual elements are specifically designed to be easily identified and memorable. Your mind associates colors much quicker than black and white name labels, and colors can help you navigate your phone faster.

The end result may be a smartphone with a rainbow color scheme, but you’ll see that color filing may make your life run a little more smoothly.

3. Alphabetical order

iPhone apps arranged in alphabetical order
If you find comfort in an A-to-Z world, this method may be for you. Instead of manually alphabetizing your apps, here’s an easier way to sort them on the iPhone:

  • Launch the Settings app.
  • Tap “General.”
  • Scroll down and tap “Reset.”
  • Tap “Reset Home Screen Layout.”

The icons that came with your Apple phone will be placed into their default locations, and your other apps will be sorted alphabetically.

If you like placing your apps in bins, another option is to create an “A” folder, “B” folder, etc.

4. How you hold your phone

Placing apps on your Android
Think about how you hold your phone. If it’s easier for you to open an app on the perimeter of your phone, then it may be best to place your frequently used apps strategically around the phone’s edges.

However, if you like to file away apps in folders, this may not be the ideal method for you.

5. Themed rows

iPhone apps arranged into themed rows
If you aren’t a fan of using folders, you can use the themed row method to place related apps together.

Assign a specific genre or theme to each row, like “day planning.” By grouping similar apps, you can easily identify which row to navigate toward.

For example, your first row can be dedicated to day planning apps such as your calendars, to-do lists and reminders. The second row could be dedicated to your favorite reading apps, and so on.

6. Frequency of app usage

iPhone home screen pages by frequency of usage
Arrange apps on different home screen pages in order of how often you use them. To keep your phone clean and easily accessible, the goal is to have no more than three home screens.

Place the apps you use most on the first page of the home screen. This is also a great section to include apps you need to get to quickly, like your camera.

On the second home screen page, you can organize folders by categories and subjects. This can be home to apps that you don’t access as regularly as the apps on your dock or home screen.

The third screen can consist of apps you use the least. You can also put apps that distract you (like games) or apps that you’re trying to use less in this space.

7. Emoji Folders

Screenshot of mobile apps organized with Emoji folders
You don’t have to label your app folders with just text. Instead, dazzle up your folders with emoji-themed labels.

For example, use the music note symbol for your music apps like Spotify and Pandora.

If you don’t want your emojis to stand alone, an alternative is to mix emoji pictures with words. The possibilities here are endless.

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Coffee Cup Size Leads to Caffeine Confusion

July 28th, 2014 | No Comments | Posted in Lifestyle

Coffee Cup Size Leads to Caffeine ConfusionHealth-related headlines often cite coffee as either a caffeinated curse or cure-all, with lines such as ‘x cups of coffee a day could lower or raise your risk of disease y’. But a new study into the caffeine and caffeoylquinic acid (CQA) content of various European coffees has again shown the huge variety in what ‘a cup of coffee’ means chemically, and how easy it can be for pregnant women to exceed the recommended 200mg of caffeine a day.

In a non-funded project – ‘curiosity driven research,’ is how group leader, Alan Crozier from the University of Glasgow, UK, describes it – the team measured the caffeine-to-CQA ratio in over 100 espressos. This expanded their previous study on coffees in Scotland. Crozier says a co-worker’s home town in Italy yielded the most consistent cups of coffee of the project. What with this, and research group member Iziar Ludwig’s trips back to Spain, there was no shortage of brews to analyse.

Results showed that the caffeine-to-CQA ratio in espressos ranged from 0.7–11, depending on the preparation conditions. With serving volumes from 13–104ml, it’s no wonder that Crozier says ‘cup of coffee is an exceedingly variable unit. To estimate health benefits using cups may be very difficult,’ – and inadvisable in epidemiological studies.

But what are CQAs? Beans contain various (poly)phenols, including 3-, 4- and 5-O-caffeoylquinic acids, the main phenolic compounds in coffee. Epidemiological studies have suggested the link between the lower risk of type 2 diabetes, cardiovascular diseases, and endometrial and hepatocellular cancer in habitual coffee consumers might be due to the presence of CQAs in coffee. They sound like super-compounds, but that’s a big ‘might’, and research continues.

Whilst the biological effects of CQAs are uncertain, one thing we do know about them is they are more sensitive to roasting than caffeine. The bean or blend also affects the caffeine-to-CQA ratio. Arabica and Robusta are the most common bean types and the latter contains twice as much caffeine as the former.

Tim Bond of the UK Tea Advisory panel suggests that ‘where preparation method can significantly impact composition, more information could be provided at the point of sale to allow consumers to make informed decisions.’

Nutrition and metabolism expert Kevin Croft of the University of Western Australia agrees: ‘Future research to provide more accurate estimates of coffee intake and biomarkers of key coffee constituents will provide more reliable assessment of links between coffee intake and disease risk.’

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