The Savage Truth on Money from Creators Syndicate

Even Summer Jobs Face Tax Obligations for 05/26/2012

Sat, 26 May 2012 00:00:00 -0700

Q. My son has a job for the summer — a real job with a real paycheck. So will he owe taxes on this money, and will he have to file a tax return?

A. Welcome to real life — where money earned is shared with the government. It may be a rude awakening for your son. The first thing he will be asked to do is fill out IRS form W-4, "Employee's Withholding Allowance Certificate ...

Updated: Sat May 26, 2012

Financial Planning for Those Who Can't for 05/22/2012

Tue, 22 May 2012 00:00:00 -0700

Many families focus on Mother's Day and Father's Day during this season of the year. But for many moms and dads, it is a bittersweet recognition. They are parents of children with disabilities — children who will never be fully capable of caring for themselves, living independently, earning a living and managing their finances.

For them, the task of parenting has a never-ending ti ...

Updated: Tue May 22, 2012

Disability Insurance More Crucial Than You May Think for 05/15/2012

Tue, 15 May 2012 00:00:00 -0700

Disability insurance is one of the most overlooked products in the insurance industry. No one wants to think about how different life would be if you were suddenly disabled and couldn't work, as a result of an accident or illness.

But how about this fact: Between the ages of 25 and 65, you're four times more likely to be disabled than to die.

Unlike life insurance, disability in ...

Updated: Tue May 15, 2012

Financial Incentives Change Behavior -- for Better or Worse for 05/12/2012

Sat, 12 May 2012 00:00:00 -0700

Q. I just read that Bank of America is going to give 200,000 homeowners a reduction of up to $100,000 in their mortgages — IF they are at least 60 days behind on their mortgage payments. Why are we rewarding people who are delinquent — and won't that encourage even more people to stop paying? I only ask because my family has been struggling to keep paying our mortgage. What do we ge ...

Updated: Sat May 12, 2012

Give College Students a Break on Loan Rates for 05/08/2012

Tue, 08 May 2012 00:00:00 -0700

Once again, Washington is playing politics with our future — both sides heating up an issue on which they basically agree but still want to play political games. This time, it's all about the interest rates on some federal student loans, which are scheduled to move back up to 6.8 percent in July.

But what no one is acknowledging is that even at 3.4 percent for a small segment of st ...

Updated: Tue May 08, 2012

Financial Literacy Month for 05/01/2012

Tue, 01 May 2012 00:00:00 -0700

April is Financial Literacy Month — a nationwide effort to "highlight the importance of financial literacy and teach Americans how to establish and maintain healthy financial habits," according to Wikipedia. Yes, the effort to spread the word about the importance of financial skills and capability has earned a place in our national consciousness, spurred on by the results of the ...

Updated: Tue May 01, 2012

Dividends Offer Attractive Return, but Tax Question Remains for 04/28/2012

Sat, 28 Apr 2012 00:00:00 -0700

Q. I was thinking about buying some dividend paying stocks, or a mutual fund that invests in them, so I could ?earn more than I'm getting in interest on my savings. But now I hear that the tax rate on dividends will go up. Should I buy those stocks?

A. That's a good question. A lot of investors have been buying stocks to get dividend yields of 3 percent or more. That looks very attractiv ...

Updated: Sat Apr 28, 2012

Economy Teeter-Totters Through Uncertainty for 04/24/2012

Tue, 24 Apr 2012 00:00:00 -0700

Which way will the economy, and the stock market, go? Both have been see-sawing back and forth, temporarily in a balancing act that has bulls and bears — and economists — holding their breath.

The stock market registers this standoff not only in the daily ups and downs but in dwindling volume, as each side waits for economic reports to bolster its case that either the economy ...

Updated: Tue Apr 24, 2012

Save-Up.com to Stash Cash, Win Prizes for 04/17/2012

Tue, 17 Apr 2012 00:00:00 -0700

Would you take a bribe? To do the right things? Things like saving and paying down your debt?

That's part of the interesting psychology behind SaveUp.com — a free website that lets you earn a shot at cash and other prizes, just for doing the right thing.

The concept has taken off since the site was launched Nov. 1, 2011. In less than six months, SaveUp users have deposited $ ...

Updated: Tue Apr 17, 2012

What If You Owe Taxes? for 04/14/2012

Sat, 14 Apr 2012 00:00:00 -0700

Q: I just found out that I will owe income taxes, but I don't have the money! What can I do?

A: I'm glad you asked, because this is an expensive situation if you ignore it. Even those filing for a tax extension are required to pay the taxes owed now. And if you fail to file and pay by April 17, you can face a penalty of 5 percent of the tax owed for each month, or fraction of a month, th ...

Updated: Sat Apr 14, 2012

Instead of Playing Lotto, Improve Odds by Planning Your Future for 04/10/2012

Tue, 10 Apr 2012 00:00:00 -0700

So you didnâ€™t win the mega-millions jackpot, but you sure had fun trying! I know, because I bought a few tickets myself. All told, we Americans bought $1.5 billion worth of Mega Millions tickets — a relatively cheap dream for a few hours or days.

It made sense at the time, from an emotional point of view, to spend a buck to buy that dream — despite the incredibly long odds ...

Updated: Tue Apr 10, 2012

Long-term Care Benefits Come Most Easily If You Know Your Policy for 03/31/2012

Sat, 31 Mar 2012 00:00:00 -0700

Q: I've heard that people with long-term care insurance have a tough time getting paid. Is this true?

A: Long-term care insurance has been getting its share of bad press lately, because of premium increases. But for those who are already receiving benefits, and their families, there is a very positive side to this story.

"Ten of the leading long-term care insurers pay $10.8 m ...

Updated: Sat Mar 31, 2012

How to Handle Soaring Long-term Care Rates for 03/28/2012

Wed, 28 Mar 2012 00:00:00 -0700

Fran Levitansky's 93-year-old mother, Dorothy, purchased a long-term care insurance policy more than 25 years ago. At the time, her coverage of $90 per day seemed appropriate. But her agent never sold her inflation coverage. Over the years, CNA raised the premiums from around $3,000 per year to $6534 per year. At least they were protected from the rising cost of custodial care.

Over time ...

Updated: Wed Mar 28, 2012

How Is a 90 Percent Long-term Care Rate Hike OK? for 03/27/2012

Tue, 27 Mar 2012 00:00:00 -0700

Bob Levy, age 69, and his wife, Cheryl, age 64, each bought John Hancock long-term care insurance policies 10 years ago. And every year since then, they have paid a combined premium of $3,893.40 per year. The couple live on a fixed income and the low interest they earn on their savings. So they were shocked when Cheryl received a notice of a 90 percent increase in the annual premium for the pol ...

Updated: Tue Mar 27, 2012

How You Can Hedge Long-term Care Costs for 03/24/2012

Sat, 24 Mar 2012 00:00:00 -0700

Q: I think it's a waste of money to buy long-term care insurance because you may never use it. And as you've

written, insurers keep raising premiums. Isn't there a better solution?

A: There are several solutions to hedging the potential cost of long-term custodial care, which is not covered by Medicare or any supplement. And, while the solutions are costly, they are far less expen ...

Updated: Sat Mar 24, 2012

Did You Know There Are Options to Repay Your Student Loans? for 03/20/2012

Tue, 20 Mar 2012 00:00:00 -0700

College students are graduating into mountains of debt — and without the income to start dealing with the debt. But here's a graduation present for every college student: a new website created by the college debt experts at Simple Tuition.

It's called PayBackSmarter.com, and it is the one site where you can gather all your student loans, figure out the required repayments and, most ...

Updated: Tue Mar 20, 2012

Creating a Mortgage for Your Relatives for 03/17/2012

Sat, 17 Mar 2012 00:00:00 -0700

Q: I want to lend my daughter and son-in-law money by making a $200,000 mortgage loan to them. How do I do this to make it legal, so I can pay taxes on the income and they can get a tax deduction on the interest and I can earn more than I would on a bank CD?

A: Making a mortgage loan to a family member can be a win-win deal — or it can breed resentment and arguments. That's why it' ...

Updated: Sat Mar 17, 2012

Debt: Can't Put It Off Forever for 03/13/2012

Tue, 13 Mar 2012 00:00:00 -0700

What do we do about the debt? It's making headlines — whether we're talking about Greek debt, or our national debt, or America's mortgage debt. There's just too much debt — and some bad ideas about what to do with it.

Let's start farthest away from home, where it is easier to see things from a dispassionate point of view. Greece needs to refinance an estimated 400 billion (eu ...

Updated: Tue Mar 13, 2012

Smart Dividend Strategy Pays Off for 03/06/2012

Tue, 06 Mar 2012 00:00:00 -0800

Why is the stock market rising?

The economy is still in rough shape, unemployment remains stubbornly high, housing remains weak, and the European financial system is a mess. Still, U.S. stocks are rising, and we're seeing daily headlines about the market hitting new four-year highs.

Why? Well, two reasons. First, despite the headlines, the economy is growing again, at least a bit. ...

Updated: Tue Mar 06, 2012

Cancer Insurance Worth the Cost? for 03/03/2012

Sat, 03 Mar 2012 00:00:00 -0800

Q: Should I buy cancer insurance?

A: Buying insurance is a choice that is based on mathematics — and

emotion. For instance, we buy homeowners insurance despite relatively long odds against a fire. But the odds of dying are 100 percent — and yet one-third of adult Americans carry no life insurance at all!

What about cancer insurance? These policies are meant to b ...

Updated: Sat Mar 03, 2012