My New Choice

The falling dollar and rising prices has left many people tightening their financial belts to the limit, in some cases even facing the need to borrow money to pay existing debts (certainly not a recommended practice).

More and more people are finding it difficult to pay their bills and are faced with credit scores that are declining due to delinquent payments.

The downward slope of a declining credit score is a slippery one and many people feel helpless when they find themselves in this situation.

Credit Repair Service

When faced with a stack of mounting bills and a diminishing pile of money, some people throw up their hands and hope the situation will magically get better. Unfortunately, that is not the case. Instead they find their credit score has gone down the drain.

By monitoring your credit report on a consistent basis, you will be able to detect any problems early on and take steps to correct the problems. There will be occasions where the blemishes on your credit report are due to your financial mistakes, although there are also instances where the credit report contains inaccurate information.

This is where a credit repair service, such as Ovation Credit Report Repair, step in to help people clean up their credit reports.

As you might imagine, there are plenty of “fly by night” operations that don’t have your best interests in mind. Be careful when selecting a credit repair service and look for a company that offers things such as a free consultation, no upfront costs, and no long term contracts.

Educate Yourself

The credit repair services are great for people that don’t want to take the time to educate themselves about their options. Given that you are here reading this, I’m going to assume that you are not in that category as you are obviously making an effort to educate yourself.

That is where Ovation Credit Report Repair sets themselves apart from many of the companies in this industry, as they provide a wealth of free knowledge in their Learning Center. You’ll find things such as: e-books, videos, and podcasts. They also have something called Credipedia, which is their Credit 101 encyclopedia of all things credit.

By taking time to educate yourself regarding the options available to you, the process to dispute inaccurate items on your credit report, and your finances in general, you can most likely avoid having to pay for the services of a credit report repair company. If you’re still unsure, or intimidated, of the process then it might be worthwhile to have a free consultation with a service such as Ovation.

In most cases, you will be able to handle your credit repair on your own if you are willing to commit to the work that will be required. Whether you ultimately decide on using a credit report repair service or not, just be sure that you are making an educated decision and not jumping in blindly.

Disclaimer
This post has been a paid review and contains my thoughts on the positive and negative aspects of the site or service in question. With the intent of providing information that is valuable to my readers, if you object to this post please let me know.

While it is no doubt more convenient for consumers to rely on credit cards than use cash for all of their purchases, it may not be the same for those people who are in professions that rely heavily on cash tips.

In the days of old, it was possible for many waiters, cab drivers, attendants, porters, bell boys, doorman, performers, and other such “tipped” workers to live off of the cash tips they earned on the job. Many were able to keep the cash tips unreported as income as there was no paper trails to prove otherwise. Additionally, it was a nice benefit to having instant access to cash before payday rolled around.

However, there are more and more people carrying credit cards than cash for safety or convenience reasons and it is affecting the incomes of those who accept tips. There is now a very obvious paper trail when credit card tips are involved, which employees must report to the IRS as part of their income. As many patrons are now prone to paying their bills and adding the gratuity onto their total bill, waiters and other workers no longer get to keep tips outright on a daily basis.

There seems to be one advantage of customers using credit cards to pay for meals and such. It seems that consumers who add a tip to their total bill typically will give a higher tip than those laying cash directly on the table. Perhaps it is psychological: Simply writing down a number to many is different from having to count out and leave actual dollars.

Not only are waiters and other customer oriented staff effected by a so-called “cashless” society, but others who count on cash donations are also seeing a slowdown. For instance, musicians or charity groups, such as the street corner Santa’s, have in the past been able to make a decent day’s take from appearing or performing on a public street. However, since less people are carrying around actual cash in their pockets, less money is being tossed into the hats and collection baskets of those soliciting donations.

While a future life without cash is unlikely, at least in the approaching few years, it may actually become a necessity for business people such as cab drivers and yard sale entrepreneurs to be able to accept credit cards or face lost income. Many charities and groups who thrive on donations have reported to see an increase in online transactions despite the fact they are seeing less actual cash donations. Consider places you visit regularly and note that if money is changing hands there is probably a credit card sign on the door.

Overall, technology is making it easier to become a cashless society and having at least one credit card on hand can help protect you from fraud when making purchases, unlike regular bank debit cards. If you plan to use a credit card the next time you visit a hotel or dine out at a restaurant, throw a few extra bucks into your wallet for the wait staff. They’ll appreciate your effort.

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Tisha Kulak is a writer for Creditorweb.com, where she writes about credit card offers, finances, credit cards, and responsible credit card use.

Online shopping has revolutionized the way we shop.

We sit in the comfort of our own homes and survey different brands of the same item, check and compare prices, read user reviews and decide what it is that suits our own needs best.

There are a lot of benefits when you shop online, including:

Better Access

Searching for products is easier online, you can more easily access items and while something may have run out of stock at a particular store, you can still see it online! You don’t have to wait for the store to open; you can shop on holidays too!

Another huge plus of shopping online, is not having to battle the hordes: crowds can be a real nuisance when you are out shopping, they slow you down and prevent you accessing the good deals. This is especially true when you are doing last minute holiday shopping and everyone else has the same idea!

Save Time, Save On Gas

You also save a lot of time when you shop from home, because you don’t have to waste time traveling to the store. As an added bonus, with the price of gasoline continuing to rise, you also save money on gas since you don’t have to drive to the store.

Save Money

The reason that shopping online can be cheaper is because it cuts out the overhead of running a store: rent, electricity and utility bills, paychecks for employees, maintenance costs etc. The seller can therefore afford to sell you an item at a cheaper rate. Also online coupons can save you a lot of money.

Sending Gifts Is A Snap

One great advantage of shopping online is being able to send gifts to people with minimum fuss, even if they live in a different city or even a different continent!

Say you want to send a gift to your dad for Father’s day (it’s coming up on June 15th so there isn’t much time left), but he lives in a different city. Hop online and search for something he might like, once you find the right gift you can have it delivered directly to his doorstep on the correct day, without ever leaving the comfort of your computer chair!

Pre-Owned Items

Another huge benefit of shopping online is the access it provides to pre-owned items, both as a buyer and a seller.

As a buyer, you can often save a considerable amount of money by finding pre-owned items for sale online. Just like buying a used car, you can often find items that are still in great condition that the current owner no longer wants because something better came along.

You also have an opportunity to turn around and sell your own items online. Just like you might be online looking to buy someone’s pre-owned items, there are people looking to buy your old items. This can be a great source of additional income, some people have even turned it into a profession.

Buyer Feedback

Consumer message boards and forums have made manufacturers more quality conscious and accountable. Being able to read user comments on any particular product comes in extremely handy when you are trying to make up your mind about what to buy. You have the benefit of other people’s experience, either good or bad with a product.

These are just some of the reasons why online shopping has become as popular as it has.

How has shopping online changed the way you shop?

For those of you that are planning a getaway this spring or summer, I am going to talk a little bit about the dos and don’ts of travel to help save ourselves some money and some hassle.

Check All Options

When you do your booking, especially for air tickets, check all the possible ticketing sites and compare the offers that each one has so you can pick the lowest one or the one that suits you best in terms of travel date, time, kind of carrier etc.

A lot of you may be aware that you get better deal on weekdays rather than weekends. Also there is this site which claims to do all the hard work for you by comparing a combined total of 500 travel sites and some 600 airlines to find you the cheapest deals, so you may want to check that one out.

Having said this, don’t ignore the option of visiting a travel agent completely, because the internet may not always be the cheapest place to buy. Sometimes sitting across from someone who will plan out and book your itinerary makes more sense. What travel agents can sometimes do is give you the benefit of bulk booking.

Check Yahoo Message Boards

Message boards are a great place to find out what travel deals people are talking about, what bad experiences they have had so that you know what or where to avoid and you may find some links to pages that you may have been looking for!

Last Minute Deals

Sometimes waiting till the last moment can get you the best possible deal, because hotel rooms can go on ’sale’ too! The only problem with waiting for the last minute deals is that you run the risk of not finding any deals and having to pay a price that might be higher than had you planned ahead.

This approach can work well if you have some flexibility in your schedule.

Flying is Cheaper Than Driving

I love driving, but on a long distance trip flying is usually cheaper and obviously a time saver as well. If you notice, fuel prices these days are just sky-rocketing so filling your tank keeps costing more and more, whereas air ticket prices have not increased that much. And if you are flying, remember a round trip is cheaper than a one-way ticket.

If you are driving and opt for a rental car, remember that most of the time you may not require travel insurance because your current car insurance policy may cover you, just be sure to check with your insurance agent. If not, you can pay by credit card as many cards now offer coverage when renting a car.

Tips Traveling With Kids

Notice how excited a kid is at the thought of taking a trip, but once you are on your way that same cheerful, excited kid becomes whiny, bad tempered and perilously close to a tantrum?

First make sure the child has plenty to keep him or herself occupied. Toys, books, puzzles, some favorite music etc. I found this very useful and comprehensive list, full of suggestions for babies and older kids.

When you sense that your child’s about to lose it, divert him or her. Distract them with a game, engage them in some activity such as looking for something that isn’t really lost, or even read out a favorite story. These are good to keep in mind because a happy child is the difference between a good holiday and awful one!

If you are tallying up your expenses every month, you may be shocked at how much you are spending on groceries.

Obviously, groceries aren’t a luxury you can do without and perhaps that is why so many of us are lenient with our grocery budget.

However, there are many ways to reduce this monthly expense.

Here are 12 simple ways to save money on groceries:

1. Buy a few Sunday papers each week and clip coupons. However, you should only save coupons of items you really enjoy. Never buy something solely because it is on sale.
2. Before you go to the store, carefully plan a sensible list. Do not stray from the list once you are in the store, no matter what is dangled in front of you in the checkout line.
3. Always buy at least a week’s worth of groceries. The more trips you take to the store, the more you risk “impulse buying.”
4. Always shop on a full stomach. You will likely buy more food when you are hungry.
5. Where applicable, you should opt for poultry instead of the much pricier red meat.
6. If possible, go to the store without your children. They have a tendency to help you fill the shopping cart.
7. Don’t be a name brand snob. Generic store brands are often just as good and will save you a lot of money in the long run.
8. Foods like pasta, rice and beans are filling and inexpensive. They make good staples in a frugal diet.
9. Items with the highest markup are often placed at chest and eye level. Don’t forget to check out foods that are stored lower on the shelves, as they may offer the best deals.
10. Shop early in the morning or late at night to avoid crowds. The faster you zip through the store, the less likely you are to stray from your list.
11. Watch your cashier ring up your items and then carefully review your receipt. Mistakes are more common than you realize and they will cost you unnecessary expenses.
12. Two words: ramen noodles.

One of the least flexible expenses in your household budget is the grocery bill. However, the tips above should help you be a little more diligent and creative when trying to reduce the cost.

By-line:
Heather Johnson is a freelance writer as well as a feature article contributor for Reward Programs, a site which helps consumers pick the best rewards program to best meet their needs. Heather welcomes your comments and emails related to job inquiries at her email, heatherjohnson2323@gmail.com.

Some of us are lucky - or foolish depending on how you look at it - in that we will be receiving a check in the mail from Uncle Sam bringing the glad tidings of a tax refund!

Forbes estimates that on average, tax payers will be receiving approximately $2,480 by way of a tax refund.

So “Splurge or Save?” That is the question!

Since this blog is all about becoming debt free, you won’t see me advising you to go spend every last penny of your tax refund if you do have debts to pay off. So let’s discuss some of the options for making good use of that tax refund.

Pay Towards Your Debt (Credit Cards, Mortgage, etc.)

Paying towards your debt, particularly credit card debt given the high interest rate on many credit cards, is a wise use of your tax refund. You will be able to reduce the amount of interest you are being charged on a monthly basis and will feel much better by knocking out a chunk of your debt.

If you don’t have any credit card debt, or the rates are very low, you might benefit from using your refund to make an extra principal payment on your mortgage. Given the reduction in savings rates in recent months, you may be able to do better by paying towards your mortgage rather than holding the funds in savings.

One last option related to your debt is that now might be the time to take advantage of decreasing rates and refinance your mortgage. The tax refund could be used to help cover the closing costs during a refinance.

Car Related Expenses

If you haven’t had your car serviced in awhile, there is no better time than now and you can use your tax refund to cover the expense. Perhaps the car needs new tires, or an oil change and tune-up that you have been putting it off.

Proper upkeep of your car will reduce the chance of a breakdown, while also increasing the fuel efficiency of your car. Car maintenance items are best handled early before it becomes a much more serious and costly problem to fix.

Maybe you have been thinking about selling your car in the near future, you can use your tax refund to get it detailed. This costs you approximately $175 and can boost the resale value of your car by as much as $1000+/-.

Set Up a Fund

If you don’t have one already, set up an emergency fund for those times when you are really in need of the extra cash. This is a great fall-back to have in place at all times!

Also, if you are planning for a major expense in a few months time, such house repairs, make a fund for that specific purpose and put away the money in a high yield savings account so that it is available when you need it, along with a small bonus!

Splurge?

If you want, you can apportion part of the refund for all of the nice, sensible expenses above and use the rest to go a little crazy. While you certainly want to be frugal with your money, you don’t have to deprive yourself of all pleasures.

So what will you spend it on, how will you treat yourself?

Perhaps a day’s spa treatment to rejuvenate and revitalize you! Or perhaps dinner at your favorite restaurant and a show you have been meaning to see for a while. Or perhaps you can go in for that Blackberry or X-Box or whatever gadget you have been lusting after. Or perhaps you can take a trip out of town for the whole family.

Charity

Last but certainly not least, you can use your tax refund to help those less fortunate by donating the funds to a worthwhile cause that you support. Having the ability to help someone in need can be very rewarding, and chances are you will remember that much longer than the dinner out at the fancy restaurant.

So…what have you planned to do with your refund?

With the days before we should all have filed our income taxes dwindling away, I am about to undertake something rather ambitious: discuss some tax breaks and exemptions.

The reason I say “ambitious” is because the income tax code is a whopping 1.3 million words long, and that makes it twice as long as Tolstoy’s massive tome “War & Peace” (just a bit of interesting trivia I thought I’d share).

Now there are literally thousands of tax breaks, so I am going to discuss a few breaks that are the most likely to apply to you and your tax situation. And it is our right - and perhaps our duty to ourselves - to do as much as possible to limit our tax liability through appropriate use of the available tax breaks and exemptions.

You can choose to pay fewer taxes by managing your finances in a way to minimize your taxes. It is possible to itemize deductions including expenses for health care, state and local taxes, personal property taxes (such as car registration fees), mortgage interest, gifts to charity, job-related expenses, tax preparation fees, and investment-related expenses. Throughout the year, keep track of all your itemized expenses so at the end of the year you have a clear idea what you can claim as exemptions.

With proper record keeping, you may find that you can take advantage of tax breaks/credits for things such as college expenses, saving for retirement, or for adopting children.

Here are 5 tax breaks that you may be able to take advantage of this year if you have not already done so:

Mortgage Exemptions

A new tax break in 2007 allows you to deduct your mortgage insurance premiums, in addition to any mortgage interest that you pay, on your 2007 tax return - assuming of course that you itemize your deductions and that your mortgage insurance policy went into effect after December 31, 2006.

Another tax break related to mortgages is the mortgage debt forgiveness, which means that if you had mortgage debt canceled/forgiven by your lender you will no longer have to pay income taxes on that amount.

IRA Deductions

In the past few weeks we have been talking a lot about IRAs, so you may know that while you cannot claim exemption for your contributions to a Roth IRA, you can for your contributions to a Traditional IRA (up to $4000 in 2007 and an additional $1000 if you are over 50).

You have until April 15th, 2008 to fund your 2007 IRA contributions so it is not too late to take advantage of any associated exemptions when you file your taxes.

The Energy Policy Act of 2005

Consumers who purchase and install specific products, such as energy-efficient windows, insulation, doors, roofs, cooling and solar heating equipment in the home can receive a tax credit.

The amount of the credit and maximum value will depend on the energy-efficient improvement. As an example, you can receive up to $200 for installing energy-efficient windows in your home.

Dependents and Child Care

You are entitled to a $3,400 exemption per child against your taxable income for dependent children. Your child, even if he or she is over 18 and earning a pay check can entitle you to claim them as dependent, so long as you cover more than 50% of their expenses. The dependent must live in your home for more than half the year and be under the age of 19, or under 24 if a full-time student.

If you have to pay for child care or care of an elderly dependent while you are at work, you can claim deductions for payments you make beyond any amount that you already set aside in a flexible spending account. The maximum credit you may receive is a 35% credit on up to $3,000 in expenses for one dependent or $6,000 for two or more, with the amount of the credit decreasing based on your income.

Higher Education

You may be able to deduct certain higher education expenses even if you don’t itemize your deductions. Depending on your income, you may qualify to take a deduction on up to $4,000 in tuition and fees with the amount reducing to $2,000 as your income increases.

Be sure to evaluate all of the recent changes to the tax code as you prepare your taxes this year, as you may be able to take advantage of these tax breaks to save yourself some money.

IRAs in general, and the Roth IRA in particular, is a vast subject and many books have been written on it.

With these recent posts, I am trying to simplify this complicated issue and I hope that you are able to benefit from this attempt to clarify matters connected to Roth IRAs.

If you have been following my earlier posts, you probably have a fair idea of what a Roth IRA is and the general rules that govern it.

Since the Traditional IRA has been around for a longer time, people are more familiar with that, and a natural question would be what is the difference between a Traditional IRA and a Roth IRA?

This is what we will look at today.

Tax Deduction

The eligibility for a tax deduction is the first and most significant distinction between a Traditional IRA and a Roth IRA. Contributions made to a Traditional IRA are tax deductible while those made to a Roth IRA are not.

Thus when you are contributing to a Traditional IRA you are able to get a tax deduction which benefits you by reducing the cost of the contribution itself. By contrast, Roth IRA contributions are made from income that has already been taxed so you don’t enjoy any deductions when you make contributions.

Tax benefits in a Roth IRA accrue only when a person actually attains retirement age, as an early withdrawal of anything other than your contributions will trigger penalties and taxes.

As an example, if you make a contribution of $2000 a year to a Traditional IRA, then that two thousand is deducted from the total amount of taxable income. So if your annual income is $60,000 and you make a contribution of $2000, you then pay income tax on only $58,000. If you make that same contribution to a Roth IRA, you will pay tax on the full amount of $60,000 but when you eventually withdraw the amount and the money that principal earned in the intervening years will be yours tax free!

Taxes on IRA earnings

Whereas in a Traditional IRA, you pay taxes as and when you make withdrawals, in a Roth IRA, such withdrawals of the principal and earnings accrued thereon are wholly tax free so long as you follow the rules and regulations governing withdrawals from your Roth IRA. In fact with a Roth IRA, you can withdraw your principal contributions anytime, without any penalty.

The same is not true for the Traditional IRA because every withdrawal requires tax to be paid on it.

Mandatory Distribution / Withdrawal Age

With the Traditional IRA, mandatory withdrawals begin at age 59 and a half and these withdrawals are required to be continued until the age of 70 and a half.

The benefit of the Roth IRA is that it does not have this mandatory distribution age, and is therefore more flexible and adaptable to your own personal requirements.

Income Restrictions

There are no income limitations with a Traditional IRA, therefore anyone can make contributions. The Roth IRA requires that you fall within certain specified income brackets to make contributions.

If you plan on living a long and healthy life, and hopefully we all do, a Roth IRA seems to have several benefits so a person who actually reaches retirement age can enjoy tax free withdrawals in his or her twilight years.

What do you think? Have you given any thought to how you are going to plan for your retirement? Have you evaluated whether the Traditional IRA or the Roth IRA is best for your circumstances?

Let me know your thoughts.