Saturday, February 28, 2009

Clashing Over Money In A Marriage

Appearances can be deceiving. Recently, my cousin told me that he has filed for divorce from his spouse. That is sad as he had a happy marriage, at least that was the impression we get whenever they attend family functions.

He told me that their numerous conflicts over financial issues got out of hand. To be sure, he is not alone in citing money problems for marital strife. Sometimes, arguing about money on a regular basis could be due to other issues being unresolved.

Clashing Over Money In A Marriage
These core issues will haunt the marriage without a satisfactory solution. My own experience is that managing a marriage requires effort, it is a merger of two people with different habits and personalities. Thus, whenever there are disputes, open communication, understanding and patience are required.

Here are some questions you can ask yourself before the situation gets ugly:

1. Is there a communication breakdown?

Don't let your spouse second guess your thoughts, desires and preferences. Communicate effectively as guessing often leads to misunderstanding, and subsequently hurt feelings and even resentment.

Choosing the right timing is half the battle won. If either of of you are already upset or angry, communicating about finances is usually futile as your negative emotions spillover which usually lead to harsh exchanges of words. You should broach sensitive issues in a way that is comfortable for both of you.

Try writing down your concerns first before lashing out in an emotional manner. Be clear about what you need from your spouse - is it paying for a big ticket item, planning a family budget or balancing the check book? Set a positive tone and good results will follow.

2. Are you hurt or resentful?

Sometimes, it's easier to argue about money than to admit our hurt feelings. We may have unknowingly hurt our spouse, but because they bottled it up, we are unaware of our insensitive actions.

The result is that the hurt continues and the other party vent their resentment by over-reacting to every issues. Instead of letting such negative emotions hinder your relationship, gather the courage to deal with the hurt.

Bring it out in the open in a healthy way. Do it before tackling money issues. That way you'll be able to discuss your finances without the extra burden of emotional baggage.

3. Are you afraid of money facts?

Are you afraid to talk about money because you don't want your spouse to discover that you spent money foolishly, didn’t pay the bill when you were supposed to, or have kept other financial secrets?

Trust has to be established in a marriage before sensitive and important issues like finances can be addressed properly. However dishonesty destroys trust. As they say, once bitten twice shy; when trust is destroyed, your spouse will not rely on you for future decisions, which can leave you feeling upset, and the cycle repeats itself.

Never make a significant financial decision without talking to your spouse. If you've been hiding something, the real issue is not about finances, it's about being honest.

In order to lay a smooth foundation in marriage for you to build your financial future, try communicating in a clear and loving manner, getting rid of emotional baggage and embracing honesty today.

Wednesday, February 25, 2009

Millionaires Who Give Money To Help: A Rare Breed?

Since last year, I have seen so much gluttony on Wall Street (bankers taking astronomical bonuses even as they cry out for taxpayers' money...) that I have almost given up on humanity.

Have our moral standards declined so much that we have no qualms about earning money at others' expenses? To be frank, I will love to see more heartwarming tales of caring and sharing from these rich people.

Millionaires Who Give Money To HelpActually, there are many millionaires who give money to help people in need, like this modest guy who gave money away to strangers and left little for his family members. At Christmas time, you may find secret Santa Claus lurking around dark corners and handing out $100 bills to strangers.

Such charitable acts deserve accolades but too bad, the media do not give sufficient coverage, either because the millionaires do not wish to seek publicity or because readers are more interested in useless gossip.

In any case, I am worried that in the aftermath of this financial crisis, millionaires who give money to help could become a rare breed, if this Wall Street Journal article: "Help, We’re Running Out of Rich People," is anything to go by.

I know a lot of millionaires have their wealth destroyed as the economic recession borders on the 1920s Great Depression. Even if you have not invested in the stock market or real-estate, hardworking and fiscally responsible folks are still affected as many businesses are struggling to survive the lack of credit and demand.

With shrinking assets, President Obama is set to exacebate the woes of the rich (by his definition, people with joint income exceeding $100,000 are RICH). This group will be taxed heavily (increase to 39.6% from 35%) as Obama seeks to reduce the deficit.

Obama will also raises taxes on the investment gains of private-equity and hedge-fund chiefs and the rate for capital gains and dividends.

I think the number of rich millionaires in America are not declining, what is happening is the significant reduction of taxable income.

However, money given to charity should not be compromised. At times like these, money for the less fortunate becomes even more critical. It is up to the millionaires when and how much to give though.

Sunday, February 22, 2009

Cooking Tips To Save Time and Money

Today, I will just have a quick post about saving time and money in the kitchen, without compromising our health. Times are bad but it doesn't mean we have to live in cardboard houses or eat poorly, just to save the few pennies.

Here are a few suggestions:

1. Buy foods that are easy to prepare, like pasta and tomato sauce, rice and beans, or canned tuna packed in water.

2. Plan ahead and cook enough food to have leftovers. Casseroles, meat loaf, or a whole cooked chicken can feed your family for several days. Be sure to freeze or refrigerate leftovers right away to keep them safe to eat.

3. Buy fresh fruits and vegetables that are in season. Buy only as much as you will use so they won't go bad.

4. Also buy frozen or canned vegetables (no salt added) and canned fruit packed in juice. They are just as good for you as fresh produce and will not go bad.

5. Try canned beans like kidney, butter, pinto, or black beans. They are loaded with protein, cost less than meat, and make quick and easy additions to your meals.

6. If your local store does not have the foods you want, or its prices are too high, go to another store or your local farmers' market. Share a ride or the cost of a taxi with friends.

Friday, February 20, 2009

Money Joke: The Misprinted Money Melee

This crook mistakenly made a counterfeit $8 bill instead of a $10 bill.

He decided to try getting the $8 bill changed so he went to the teller at the local bank and asked for change.

The teller looked at the $8 bill, hesitated, and then gave the crook two $4 bills as change.

Tuesday, February 17, 2009

Tug Of War Between Retailers And Frugal Consumers

It is like a flu bug... frugality is now the hallmark of Americans as they churn up ever creative methods to save and buy stuff in bulk. How smart you shop has become a new status symbol. From a macroeconomic and retailers' point of view, this situation is, of course, not ideal.

Nevertheless, when the good old days of rising income, heavy debts and buying on credit is over, retailers have to adapt by delivering long-term value in their products, not empty promises.

Retailers And Frugal ConsumersPromotion strategies are also being re-adjusted to entice buyers. It is common to see banners at supermarkets screaming out slogans such as: "Go Green," "Loyalty Programs," "Value," "Best Prices" and "Local Ownership."

Like most Americans, I love buying in bulk to save money but let's not forget that many retailers have capitalized on this mentality to improve their sales, at our expense in terms of health and finance.

Some of the things which consumers get "punished" for when chasing good deals:

1. Being Tricked Into Paying Higher Prices

Buying in bulk may sound cool but it is not always cheaper, according to Frugal Dad. Supermarkets are not foolish to engage in money-losing business, so check the unit pricing before taking discounts for granted.

2. Beware of "Special Deals"

We are tempted whenever we see "special deals" but do you know that some retailers mark up their prices on such products? Or they have packaged the products in such a manner that it is difficult to gauge the actual price. End of the day, we get only minimal savings, not the 20% or 50% we are led to believe.

The stores coupons are also reserved for more expensive or less popular brands. The best approach for consumers is to shop at one store and learn its prices.

3. "Loyalty Programs"

Loyalty programs means that we are forced to pay higher prices for not joining. The alternative is to sign up and compromise our privacy, we will be inundated by offers which encourage us to purchase more, even when we have little use for the products.

4. Pay For Cleanliness

Retailers that order food in bulk often face cleanliness problems when they maximize space to accommodate their immense inventory. Rats, flies, ants, and other vermin require extra costs (to employ more staff and get in pest control) to eradicate. Surveys have found that about half of all deli and meat workers engage in unsafe/unhygienic practices.

5. ‘Fresh’ is Relative

Baby/infant food are strictly regulated but there are no federal laws mandating product dating for other products. A retailer may legally sell foods beyond the use-by date as long as the product can be considered unspoiled and safe to eat. Even repackaging is legal.

6. Impulse Shopping

Retailers have many tricks up their sleeve to get us to buy more than we plan. Sometimes a shopping list prepared in advance is not enough to restrain your impulse buys.

7. Slotting Fees

Some big retailers charge manufacturers a "slotting fee" to have their products placed in desirable locations. The fee varies greatly depending on the product, manufacturer, and market conditions.

For a new product, the initial slotting fee may be approximately $25,000 per item in a regional cluster of stores, but may be as high as $250,000 in high-demand markets. In addition to slotting fees, retailers may also charge promotional, advertising and stocking fees.

All these fees result in increased wholesale prices which are then passed on to consumers.

8. Scanners suck our money slowly

Here we are struggling to pinch pennies, but when the price is not right, our objective to save money becomes self-defeating. You may be surprised to know that overcharging by retailers is occurring with alarming frequency.

Just ask the CBS 3I Team which investigates stores with price scanner problems. They uncovered some stores with so many violations they were actually hauled into court for making you pay too much.

One way to reduce overcharging is to scrutinize your receipt and check the weight of your items. Some stores will give you the item for free if you catch their mistake. Many consumers have already sued retailers like Target, ACME, Redners successfully, so the odds of justice being served is strong.

Retailers wish to make as much profits as possible while consumers want to save money. If everybody is being frugal now, saving money becomes even harder. We have to be alert and go the extra step of doing homework like being familiar with unit pricing and comparison shopping.

Thursday, February 12, 2009

How To Search For Unclaimed Money?

While I am struggling to cope with this recession and trying to build as much of an emergency fund, I am amazed that there are people who leave money unclaimed. Are they too rich or just forgetful?

How To Search For Unclaimed Money?There are people like Brent Minnick who made a business out of locating unclaimed money. This guy combs databases and once he identifies recoverable funds, he tracks down the owners with a proposition of 25% commission for doing the dirty work of claiming the money. A win-win solution but it can get pretty steep for a $1 million dollar windfall.

If you are hungering for a windfall and do not want to go through a middleman, here are some sources to start with:

Saving Bonds

About 41 million U.S. saving bonds (mostly Series E and H bonds dating as far back as 1941) have matured and no longer earn interest. So your grandfather long-term investment could have matured and is worth a fortune. A $25 bond sold in the 1940s could be worth 10 times its face value today.

Some people don't redeem old bonds because they lose them or forget they ever owned one. Others hold onto bonds as a keepsake. Unfortunately, by not redeeming a bond, you don't get the income or the return of principal.

To find out if you have a matured bond issued in 1974 or later, use the Treasury Hunt database. This also reveals if your missing bond is one of the 15,000 bonds that are returned annually to the Treasury as undeliverable.

For older bonds, you can start the redemption process by filling out a detailed claim for lost, stolen or destroyed U.S. Saving Bonds (Form 1048). It's available online at TreasuryDirect or at local financial institutions.

If your memory of a bond is vague, the Bureau of Public Debt will try to trace it for you. Write to the bureau at Box 7012, Parkersburg, W.Va., 26106-7012. Filling in as much information, like the denomination, date of issue, name and address of the owner will strengthen your case.

Federal Funds

The Treasury Department also keeps a list of unclaimed money held by federal agencies. The largest pot of money, as at end September, belonged to the judiciary, with $168 million in unclaimed cash. Much of that is restitution paid by offenders to victims who can't be located.

It also includes dividend income belonging to bankruptcy creditors that can't be located. Usually, the court holds the money for five years and then turns it over to the judiciary's unclaimed fund. If you are owed money, you can make a claim. You must go back to the original court and obtain a court order.

Tax Refunds

You have three years to claim your tax refund before the money goes back into the Treasury's coffers. So if you never received your 2005 refund because you didn't file a tax return for that year, you have until April 15 this year to do so.

The Internal Revenue Service doesn't have figures yet on the amount of unclaimed refunds for 2005. But if past years are any indication, about 1 million taxpayers have left $1 billion to $2 billion on the table.

Obtain back tax forms and publications at IRS or call them at 800-829-3676.

There are other sources of unclaimed money like bank accounts, escrow accounts, utility or apartment deposits, final paychecks of short-term jobs, property settlements in divorces, safe deposit box contents, insurance policies and checks that have never been cashed.

So far, I have been searching for unclaimed money, to no avail. I guess my windfall comes from rifling through closets and old purses to find a few pennies. Maybe, you will have better luck than me.

Tuesday, February 10, 2009

Saving Money in Plain English

A short guide to how compound interest can help money grow over time. This video comes in an unbranded "presentation quality" version that can be licensed for use in the workplace.

Sunday, February 8, 2009

Do You Keep Up With The Joneses?

Previously, I mentioned about this $50K or $100K survey. Even though the statistical sample is confined to Harvard, the results represents quite accurately the mentality in our society. Aren’t we always comparing who has the flashier car or bigger house?

Do You Keep Up With The Joneses?
My wife and I will rather have the $100,000 because we have never been interested in keeping up with the Joneses. If you can make more money than me and enjoy fine dining, shopping, staying in 5-star hotels every day, so be it.

Coming home from a hard day's work and then spending time with my wife is more important, rather than chasing for more money by taking on another sideline job. I am satisfied when my current job allows me to afford simple indulgences without going into debts.

Fortunately, we did not adopt an extravagant lifestyle, even during the rolling good times when our household income inflated. Hence, there are less drastic adjustments for us to make in this recession.

Nevertheless, the survey caused me to think deeper about money, especially in this bloody period of deleveraging and wealth destruction. Why do we crave for money? Where we do draw the line and say we have enough money for a lifetime?

For a lot of us, the more money the better. I guess this boils down to our insatiable desire for status. After all, we like to judge ourselves by what others have and not what we need.

How do you feel about money? Do you think money and status are related? Does it stoke your ego to be able to spend more money than your neighbor?

Thursday, February 5, 2009

Why Hitler Is Vexed About Foreclosures?

Find out why Hitler is so vexed about foreclosures. Enjoy this comedic video.

Monday, February 2, 2009

Saving Money For Movie Fans

I love to watch movies but not at theaters. I do make exceptions though - some movies have such attractive storylines, cast or special effects that I just can't wait to catch it on the big screen.

However, most movies don't get me excited enough to make a trip to the theaters. It is wasteful as you don't just pay for the movie tickets, usually there are other expenses like meals, drinks, popcorns, gas, shopping, etc which can add up to a pretty expensive trip.

Saving Money For Movie Fans
A little patience (3-4 months but could be shorter these days) can save a lot of money over the long run. Here are a few tips to save more money for movie fans:

1. Re-Watch DVDs In Your Collection

My family budget allows me to buy 1-2 pieces of DVD per month and they are usually movies which are very entertaining or meaningful and I will never tire of watching the re-runs.

In this recession, I try my utmost to avoid rentals. Instead, I will just pull out those faithful favorites in my collection. Not only do I save a rental, but I spend quality time with my wife, thoroughly enjoy myself and rediscover my love for that movie.

I am flabbergasted that some of my friends buy DVDs regularly but they hardly watch any of them or let them collect dust after one viewing. It’s so wasteful, but I am not complaining since I borrow DVDs from them occasionally and they are kind enough to pass on some old movies to me when they clean up their house.

2. Buy Previously Viewed DVDs

There is nothing wrong with buying second hand DVDs. The movie quality will not suffer just because it has been viewed umpteen times. When I want to buy a movie, I usually head to Blockbuster's Previously Viewed section.

On average I spend about $8 per movie. Now, just compare that to a new DVD which can cost about $25-$30. The saving is immense when you do it every month. As for the picture or sound quality, I can assure you that the "Previously Viewed" movies are as good as the $25 shrink wrap copies.

3. Hold Off On HD

I am never one to rush into new technology. I guess I was one of the latest adopters of music CDs as I gave up on cassettes until the stores stopped stocking them.

To be sure, new technology is always far more expensive now compared to next year (or even next quarter). HD players and systems have already come down a lot in price, but in another year they’ll be exponentially cheaper.

I am fine with DVDs. I mean the difference between a good quality DVD and HD isn’t anywhere near the difference of the old VHS to DVD comparisons. If you really have money to spend, by all means, go ahead and get HD right away.

4) Join Netflix or Zip

I don't have a penchant for movie rentals but there are times when I feel generous and just want to watch a movie to kill time. I recommend a service like Netflix or Zip.Ca (for those in Canada).

You can get a simple cheap plan (like $9/month) that gives you 1 disk at a time. You can easily go through 4 or more movies a month and you never have late fees.