Buddy's Tips #002- Identity Theft: Prevention Suggestions

Protect all of your personal financial information. Make it a personal rule “NEVER” give out personal financial information (e.g. checking or credit card numbers; social security numbers) unless you have initiated the action or transaction and it is a legitimate purpose.

Ignore all e-mail spam asking for your information or verification or any other solicitation to gain information directly from you. Do not click on any link embedded in the e-mail. DELETE all of these e-mail as a personal rule of thumb.

Report lost or stolen credit cards or checks immediately. Both can be stopped or blocked immediately.

Carry one or two credit cards in your purse/wallet and never carry information with important numbers (e.g., Social Security Card, pay stubs, PIN numbers).

Buy a Shredder and shred all financial information, statements, account receipts, ATM receipts, bank deposit receipts, etc. with account numbers or personal financial information on it. Keep wallet and purse clean of receipts…empty your receipts daily into a closed container for security reasons. Use them to review your credit card statement monthly and then shred those receipts that you do not need to keep.

Guard your ATM PIN number and account receipts. Don't discard them.

Guard your mail (top security). Don't use your personal mail box to mail bills. Drop your bill payments in a regular mail drop box or at the Post Office itself. When you arrive home each day remove all mail from your personal mail box immediately.

Use “Bill Payer” (or a similar electronic bill paying program) at your local bank or credit union to pay your monthly bills. This will save writing a check (e.g., reduces exposure of your checking account number), save on the cost of postage (e.g., 44 cents per 1 ounce envelop in 2009) and fuel (e.g., driving to the drop box or post office to mail the bill) and time (e.g., on-line bill payment can take only seconds to accomplish). It also gives you a record of payment similar to your check and it reduces “check float” time, which saves you money on any mortgage payments (e.g., reduces interest paid).

Develop a tracking chart of your monthly billing, so you know when you usually receive your individual bills each month. If regular bills stop coming call the company and investigate why. Sometimes a false change of address is used to divert information.

Know your anticipated account balance (based on tracking chart). Check your statements carefully. If there is a discrepancy contact the company issuing the statement immediately. You have 30 days from receipt of statement to dispute a charge and begin corrective action.

Know your checking balance and verify it on-line or upon receipt of statement.

If you are suspicious about a bill investigate it and take immediate action!
o Contact the police and file a report.
o Contact lost or stolen card and fraud division of your bank, credit union, credit card issuers immediately!
o Contact the fraud division of the three major credit reporting agencies mentioned above.
o Contact Social Security Fraud Hotline: (800) 269-0271
o Contact the FTC Identity Theft Hotline: 1-(877)-438-4338

If you use an on-line computer install firewall software to prevent access and don’t put financial information directly on your computer.

FREE CREDIT REPORT:

Check your credit report for FREE every four months by contacting one of the three credit reporting companies and requesting a free copy of your credit report. This will allow you to monitor your credit report each year at no cost to you.

o Equifax (www.equifax.com) (800) 685-1111 or (888) 766-0008 or (800) 525-6285
o Experian (www.experian.com) (888) 397-3742
o Trans Union (www.transunion.com) (800) 916-8800 or (800) 680-7289


INTERNET RESOURCES:

Federal Trade Commission web site: www.consumer.gov/idtheft
Internet Crime Complaint Center: http://www.ic3.gov/default.aspx
Identity Theft Resource Center: www.idtheftcenter.org
Privacy Rights Clearinghouse: www.privacyrights.org
FTC free booklet: http://www.ftc.gov/bcp/edu/pubs/consumer/idtheft/idt04.shtm
“ID Theft: When Bad Things Happen to Your Good Name”, or
call (888) 687-2277 for a shorter version (ask for stock number D18052)

Buddy's Tips #001- Sources of Money

Here are some of the sources I have used in the past to generate "cash" depending on the need:
1. Your current income: Reduce spending (i.e., live on a very tight budget)
2. Refinance Home Mortgage
3. Home Equity Loan
4. Home Equity Line of Credit
5. Construction Loan
6. Co-signed Loan (e.g., family or friend)
7. Secured Loan (e.g., savings or share loan; collateral loans)
8. Savings
9. Unsecured Loan (e.g., personal unsecured loan)
10. Loan (secured or unsecured) with payments made by savings account interest plus prepayment supplement
11. Credit Card Cash Advance
12. Whole Life Insurance Cash Value Loan
13. Gifts from relatives
14. Loan from relatives or friends
15. 401(k) Loan
16. Sell something thru self-marketing (e.g., sell personal items through garage sale, e-bay, craigslist)
17. Pawn Shop (e.g., borrow against a personal item)
18. Consignment shop (e.g., sell a personal item)

Free Market Financial System?

As I watch what is going on in Wall Street, I reflect back to the days of Enron and World.com and I'm more convinced than ever that we do not have a "true" free market financial system any more. What we have is a play ground for the wealthy and those who think they know it all. These are the folks who "like to make big deals" and receive big commission checks. In their arrogance, they look down on the "little people" who provide them the money that they so freely spend at no risk to themselves. Jesus says, "What does it matter if you gain the whole world and loose your life?" This question can be applied to our nation and those who drive its financial sector, "What does it matter if you gain the whole world and lose a nation?". What is the bottom line in all of this? Individual and corporate GREED!!!

So what does that mean for me as a consumer and investor?

Well, I will be putting my money in investments that are guaranteed by FDIC or real estate property. By purchasing real estate I accomplish two things: 1) I can provide housing for others (renters), which allows me to help my fellow man; and 2) I will receive an income. At least with real estate and FDIC insured investments I can control their usage without fear of loss of my investment due to the wild ideas of some money manager in a New York City brokerage house. I have lost all my respect, confidence and trust of big investment firms...they too don't know what they are doing. The loser will always be the hard working American, who is trying to save money for future retirement.

Giving my hard earned money to Wall Street, where they say "trust me"...is not the brightest thing for me to do. $700 billion dollars as a bail out...? While as a nation we may have no choice to save our economy and financial future, it is important to me that Wall Street work hard to return to private sector monetary sources as quickly as possible and return the loaned tax payers funds back to the American government as fast as possible. I hope that Congress has sense enough to "fire' the top executives and money handlers of these corporations before they give them the funds and hire people who can be trusted to protect the tax payer and investors in their daily financial decision-making. I also hope that Congress has sense enough not to pay large severance packages to executives who have brought their corporation and our nation to the brink of financial disaster.

Currently I save 15% of my earned income. I don't want to have some "free-thinking, money grubbing, speculator" in a brokerage house spend it on a poor financial strategy, dumb idea or speculative impulse.

Savings and Investment Program

One thing I learned early in life, thanks to my grandmother and aunts, was to save money. I had to teach myself how to do that "systematically". "Automatic withdrawals into savings" has been a big help in this regard. Over the past decade or so, with the advent of deferred savings programs (IRA, 401k, etc) I have always been able to save a little here and a little there and over time have been able to build up to the maximum established by law. The trick has always been to never allow any new income to get into my checking account. So the combination of "automatic withdrawal" and deferral programs, has made it even easier to save for retirement every pay day. God has been kind to me in this regard and I praise Him for His love and generosity.

All of this takes discipline and dedication. You have to have a personal "vision" of what you are trying to accomplish. It also requires much self-sacrifice. To save or invest for the future (mutual funds are an investment) you have to give up things you may "want" today, so that your investment program will allow you to live and enjoy life fully somewhere in the future.

My best friend began a savings and investment program 25 years ago starting at "0". He is today a millionaire... and owns 2 beautiful homes. So I know personally "putting money into savings and investments over time" works.

One final thing I learned, is that you have to save/invest at the same time you are reducing and eliminating debt. Time is truly money, so the longer you have funds invested the greater the benefits of compounding; stock growth; property value.

All of this has been a daily challenge for many years in managing my money. Especially, when you are trying to do all of this and meet the needs of your family, pay for college, maintain automobiles, etc...

It truly tests your skills. I pray each day for 30 - 60 minutes and asks for God's inspiration as I present my daily issues to Him. God has always shown me the right paths to follow. To quote Our Blessed Mother...Praise be Jesus!

Buddy's Tips #003- Mortgage Payment

Here is a technique I have used quite a bit. In the near future I will add my pre-payment techniques to this section. I pay my mortgage on a 25 day cycle. One technique I have used to maintain my 25 day payment schedule on my mortgage is to obtained a secure or unsecured loan to make my mortgage payment or prepayment. This technique can also be applied to other bills. While this may sound weird, it is actually a good way to meet all payment obligations in advance; it gives me an additional 30 days until the next billing cycle; and it gives me the time needed to pay-off the secured or unsecured loan during the 30 day time frame. Everybody wins and I do not have to worry about when I get paid to make my mortgage payment. Once I'm paid I simply pay off the loan.

Buddy's Tips #005 - Consolidation Loans

In January 2009 I consolidated a $5,000 energy loan into an existing share loan, which did two things for me: 1) eliminated a monthly payment of $136 to the City (so I have freed up $136); and 2) transfered my 5% energy loan to a share loan at 3% on which I pay a regular monthly payment anyway (so it cost me nothing new). I added the $136 to my monthly payment on the share loan to accelerate payoff. Consolidation loans are good when they free up funds to use in additional debt reduction strategies. This is how you should use Consolidation Loans.