Europe’s Financial Crisis Leads to Suicide Surge
The harsh spending cuts introduced by European governments to tackle their crippling debt problems have not only pitched the region into recession — they are also being partly blamed for outbreaks of diseases not normally seen in Europe and a spike in suicides according to the AP.
The report goes on to say that the “worsening health was driven not just by unemployment, but by the lack of a social welfare system to fall back on. People need to have hope that the government will help them through this difficult time”.
I think that it is “nice” to have public assistance programs available for the truly needy. There is however something inherently wrong with these social programs. I believe these programs promote government dependency.
A growing dependency of government is what got us into so many of our problems, and what is our own government doing? They are promoting that very dependency. Instead of raising people up, we are keeping them down. We are creating a generational dependency on social programs.
According to the 2012 Index of Dependence on Government more people than ever before—67.3 million Americans, from college students to retirees to welfare beneficiaries—depend on the federal government for housing, food, income, student aid, or other assistance.
Once considered to be the responsibility of individuals, families, neighborhoods, churches, and other civil society institutions, Americans are looking to the government to take care of them.
The ethic of self-reliance joined with a promise to the brotherly care of those in need appears threatened, well nearly absent in today’s society. There was a time, before all of the social programs, when people took care of each other. If you were having trouble the first thing you did was —anything you could — to get back on your feet.
There was no sitting around waiting for the government to come to the rescue. Your church, or family or friends helped out, and you helped others when they were in need. We took care of ourselves without a dependency on the government.
Our social programs including Social Security, Medicare and Medicaid are unsustainable in their current form.
Over the next 25 years, more than 77 million baby boomers will begin collecting Social Security checks, drawing Medicare benefits, and relying on long-term care under Medicaid. There will be no event so financially challenging to these programs over the next two decades than this shift of boomers into retirement.
More than 70% of Federal spending goes to dependency programs.
With so many Americans on or soon to be on the government dole and nearly half of all Americans not paying income taxes, there is no way we can pay for all of this and our spending will spiral out of control (it’s almost there now). With an increase in recipients and a decrease in the number of workers left paying for these programs, we will soon reach our fiscal tipping point much as other countries have already, and this will put us in a certain domestic debt crisis of our own.
In doing research for this article I have found no evidence that Americans are suffering a rise in medical ailments and suicides. But we have not quite reached the same crippling financial problems as our friends across the pond.
…but trust me when I tell you, it’s coming.
H&R Block Snafu Delays Refunds
…mandatory field on tax form left blank
Marketwatch.com — H&R Block, the nation’s largest tax preparer, confirmed that its software failed to fill out a mandatory field on Form 8863, which is used to claim educational credits. The IRS would not say what percentage of the roughly 600,000 faulty returns came from H&R Block (US: HRB), but the company received thousands of complaints on its Facebook page and on Twitter.
I have to tell you, I would be pretty mad if this had happened to us. My wife and I used TurboTax to prepare and file our tax return; we have for the last 5 years or so, and have never had a problem. I used H&R Block when I was younger and all I remember was an expensive “loan” in order to get my return immediately. I thought the days of those short term refund loans were over but they are not. Now there is what is called a RAC / RAL or Refund Anticipation Check / Loan.
RALs are those short-term loans usually at outrageous interest rates, for the amount of an expected refund. Tax prep fees are usually deducted from your return amount also. A “good” RAL might have an APR of 40%; a bad one can end up costing 10 times that much.
When combined with other the cost of the RAL can approach loan-shark levels.
Thankfully, this might the last year people need to be warned about RALs. That’s because the RAL industry is getting squeezed by federal regulators, who are cutting off bank funding to the biggest RAL lenders, and by the Internal Revenue Service, who is making it easier to get refunds quickly and without crazy fees.
You know, what’s really problematic is the fact that you have to pay H&R Block something like $150 for 30-40 min of time with their “tax consultant”. If I’m paying for an “expert” to prepare my taxes, I would expect there to be no errors. I realize the “tax consultant” is a human, prone to making mistakes, but this goes farther than the individual tax preparers, the fault falls on H&R Block for failing to stay up-to-date with the IRS and failing to properly train their “tax consultants”.
H&R Block explained that a form had changed, Form 8863 relating to student tax credits, and that in previous years, five lines on the form could be left blank for a “no” answer. Starting this year, preparers must enter an “N” in those fields or risk a delay.
H&R Block said it learned about the tax form change after it had submitted hundreds of thousands of tax returns. The IRS said it was aware of the problem and it is continuing to review the situation and work with “affected software companies to assist in the processing of those tax returns.”
You know, I was always instructed when filling out any form, to never leave a “blank”. If it’s a “no” answer, mark it “no”. If something doesn’t apply, use “n/a”. You would think that H&R Block’s highly trained tax preparers would follow this thinking just from common sense, especially if you are dealing with the Government.
I feel sorry for Mr. & Mrs. John Q. Public who filed their tax return and is expecting their refund only to find out it’s going to take at least 21 days for the IRS to figure everything out and issue the refund.
Now, my good friend TurboTax is not exempt from errors either. Last week, the Minnesota Department of Revenue warned taxpayers against using TurboTax to file their state income taxes, finding 10,000 returns had problems. In a terse statement, the Minnesota Department of Revenue said it would stop processing tax returns filed through Intuit (the company that operates TurboTax) if the problem is not fixed.
Well, I don’t live in Minnesota so it doesn’t affect me but if I did, I wouldn’t be as upset with TurboTax since I know full well that I am filing my return on my own with the help of a computer program. There’s not a $300 an hour “Tax Consultant” using their knowledge and expertise to make sure my return is done correctly.
If you want to insure your taxes get prepared correctly, seek out an Accountant or Bookkeeper certified to prepare tax returns.
… Often times you get what you pay for.
Little Known Database That Helps Debt Collectors Call You at Work
…The Surprising Way Debt Collectors Know Where You Work
BusinessInsider.com — It is “perhaps one of the most powerful and private databases of American’s personal information ever created, containing 190 million employment and salary records, covering more than one-third of US adults.”
So there is this site called The Work Number and basically what they do is employment verifications for employers. That sounds OK right? Well, it is. It keeps companies from having to spend time verifying employment, they just outsource the job. One catch however, is that the company is required to provide The Work Number with weekly salary and employment information. So to make this requirement easy to handle, most companies provide The Work Number with access to their HR database directly.
What this means is that The Work Number has the work and salary history of millions of Americans. You might think that this is no big deal, after all they have to do employment verifications, and they need that information. Here’s the problem, The Work Number is owned by Equifax, one of the big 3 of credit reporting agencies, and they like to sell information, and sell they do. They market directly to debt collectors.
…ever wonder how the bill collector got your work number? Well, there you go.
Are debt collectors allowed to call you at work? Yes and no. Let’s take a look at some of the things the bill collectors can and can’t do. Keep in mind that what applies to debt collectors doesn’t always apply to the creditor who is trying to collect their own debt.
- FDCPA (Fair Debt Collection Practices Act) is what regulates debt collectors and their practices.
- Third party disclosure — debt collectors are prohibited from disclosing or discussing your credit or debt, with any third party. There are exceptions however, they may talk to your attorney, a credit reporting agency and the original creditor. They can also contact your spouse or your parents if you are a minor.
- Debt collectors are not allowed to contact you at unusual or inconvenient times or places. Typically the time to make calls is between 8 a.m. and 9 p.m.
- They are not to contact you if you have an attorney or other agency handling your debt.
- They may contact you at work unless, your employee prohibits calls at work or you advise them that you cannot receive calls at work, it’s best that you send a letter to that affect.
- They may not harass or threaten you. Specifically they cannot:
- Threaten violence
- Any harm or threaten to harm you or another person’s reputation or property
- Use profane or abusive language
- Call you repeatedly, or
- Make calls to you without identifying themselves as bill collectors
- Collection companies are not allowed to add interest of fees or charges that are not authorized by the original agreement or by state law
- …and many others
There is one tried and true method to get the debt collectors off of your back… pay your bills! I know it sounds easier than it is. If you find yourself overwhelmed with debt the best thing to do is contact a professional to help you get your life back.
If you are currently past due, the benefits of a debt management program will provide you with a fresh start. The biggest long-term benefit of the debt management plan is the reduction in interest. Reduced interest allows you to pay off your principal balances faster while saving you possibly thousands of dollars in finance charges.
In order to determine your eligibility you can fill out an online budget application form Now and then you will speak with one of our Certified Personal Finance Counselors © at (800) 920-2262.
Finance Is Really Not That Complicated
Seriously, personal finance is not all that complicated. Sure it can get crazy when you throw in estate planning and charity foundations, but the principles behind personal finance are as easy as they come.
You can actually strip it down to just a few points:
1. Spend less than you earn.
Make $50k a year? Great, spend $49,999 or less (or whatever your after-tax amount comes out to). Got your paycheck and it’s an even $1,000? Awesome, just don’t spend any more than that and you’re golden. It’s really not that convoluted.
2. Don’t go into debt.
Don’t spend money lavishly and throw all sorts of stuff you don’t need on your credit card. Don’t take out $40k loans for a new car, or a new boat, or a new electronic robot that makes you coffee and brushes your teeth for you every morning. Again, nothing too complicated here.
3. Save money.
Whether it be in a savings account, a checking account, your 401(k), your Roth IRA, your safe, or even in your bed mattress (which I really wouldn’t advise), storing away money is a pretty simple concept – all you have to do is NOT spend it 😉
I bring this up so matter-of-factly because a lot of people I know try to make this much harder than it really is. Wake up – it’s not! If you’re just looking for excuses to avoid responsibility, then by all means do your thing. But if you really CARE about making a change and laying down your financial foundation, then snap out of it and START. The basic rules of personal finance are easy, it’s applying yourself that’s the hard part.
From one of our favorite bloggers: Budgets Are Sexy
The Credit CARD Act of 2009 becomes Law
The President signed into law H.R. 627 (“The Credit CARD Act of 2009”) as Public Law 111-024. The law provides, in part: “Section 201(1) IN GENERAL.-Not later than 6 months after the date of enactment of this Act, the Board shall issue guidelines, by rule, in consultation with the Secretary of the Treasury, for the establishment and maintenance by creditors of a tollfree telephone number for purposes of providing information about accessing credit counseling and debt management services, as required under section 127(b)(11)(B)(iv) of the Truth in Lending Act, as added by this section.
(2) APPROVED AGENCIES.-Guidelines issued under this subsection shall ensure that referrals provided by the toll-free number referred to in paragraph (1) include only those nonprofit budget and credit counseling agencies approved by a United States bankruptcy trustee pursuant to section 111(a) of title 11, United States Code.”
Key Elements: Credit Card Act of 2009
Bans Unfair Rate Increases: Financial institutions will no longer raise rates unfairly, and consumers will have confidence that the interest rates on their existing balances will not be hiked.
Bans Retroactive Rate Increases: Bans rate increases on existing balances due to “any time, any reason” or “universal default” and severely restricts retroactive rate increases due to late payment.
First Year Protection: Contract terms must be clearly spelled out and stable for the entirety of the first year. Firms may continue to offer promotional rates with new accounts or during the life of an account, but these rates must be clearly disclosed and last at least 6 months.
Bans Unfair Fee Traps:
Ends Late Fee Traps: Institutions will have to give card holders a reasonable time to pay the monthly bill – at least 21 calendar days from time of mailing. The act also ends late fee traps such as weekend deadlines, due dates that change each month, and deadlines that fall in the middle of the day.
Enforces Fair Interest Calculation: Credit card companies will be required to apply excess payments to the highest interest balance first, as consumers expect them to do. The act also ends the confusing and unfair practice by which issuers use the balance in a previous month to calculate interest charges on the current month, so called “double-cycle” billing.
Requires Opt-In to Over-Limit Fees: Consumers will find it easier to avoid over-limit fees because institutions will have to obtain a consumer’s permission to process transactions that would place the account over the limit.
Restrains Unfair Sub-Prime Fees: Fees on subprime, low-limit credit cards will be substantially restricted.
Limits Fees on Gift and Stored Value Cards: The act enhances disclosure on fees for gift and stored value cards and restricts inactivity fees unless the card has been inactive for at least 12 months.
Plain Sight /Plain Language Disclosures: Credit card contract terms will be disclosed in language that consumers can see and understand so they can avoid unnecessary costs and manage their finances.
Plain Language in Plain Sight: Creditors will give consumers clear disclosures of account terms before consumers open an account, and clear statements of the activity on consumers’ accounts afterwards. For example, pre-opening disclosures will highlight fees consumers may be charged and periodic statements will conspicuously display fees they have paid in the current month and the year to date as well as the reasons for those fees. These disclosures will help consumers make informed choices about using the right financial products and managing their own financial needs. Model disclosures will be updated regularly based on reviews of the market, empirical research, and testing with consumers to ensure that disclosures remain clear, useful, and relevant.
Real Information about the Financial Consequences of Decisions: Issuers will be required to show the consequences to consumers of their credit decisions.
Issuers will need to display on periodic statements how long it would take to pay off the existing balance – and the total interest cost – if the consumer paid only the minimum due.
Issuers will also have to display the payment amount and total interest cost to pay off the existing balance in 36 months.
More Key Elements
Accountability: The act will help ensure accountability from both credit card issuers and regulators who are responsible for preventing unfair practices and enforcing protections.
Public posting of credit card contracts: Today credit card contracts are usually available only in hard copy and not in plain language. Now issuers will be required to make contracts available on the Internet in a usable format. Regulators and consumer advocates will be better able to monitor changes in credit card terms and evaluate whether current disclosures and protections are adequate.
Holds regulators accountable to enforce the law: Regulators will be required to report annually to the Congress on their enforcement of credit card protections
Holds regulators accountable to keep protections current:
Regulators will be required to request public input on trends in the credit card market and potential consumer protection issues on a biennial basis to determine what new regulations or disclosures might be needed.
Regulators will be required either to update the applicable rules, or to publish findings if they deem further regulation unnecessary.
Increases penalties: Card issuers that violate these new restrictions will face significantly higher penalties than under current law, which should make violations less likely in the first place.
Cleans Up Credit Card Practices For Young People at Universities. The act contains new protections for college students and young adults, including a requirement that card issuers and universities disclose agreements with respect to the marketing or distribution of credit cards to students.
DEBTHELPER.COM 