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Consumer Archive

Consumer

Credit counselors say resolutions not right for everyone

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WASHINGTON (12/28/12)--There is a right way and a wrong way to do most things, the National Foundation for Credit Counseling (NFCC) reminded recently, while adding that the adage applies to making New Year's resolutions about debt.

Gail Cunningham, spokesperson for the NFCC, offered tips on how to determine when a resolution is appropriate and when it is not.  Even the most noble intentions, she warned, can backfire.

The NFCC suggests considering the following before making these 2013 commitments:

  • Pay off debt:   If increasing payments to creditors means compromising the timely payment of priority obligations, it's not the proper use of money.  Keep the home life stable by ensuring that the rent or mortgage is current, utilities are on, food is in the pantry, gas is in the car and medicine is purchased.  The goal is to have all debt obligations met in a timely manner, but when money is tight, paying in the proper order is essential to prevent a bad financial situation from becoming worse.
  • Begin exercising: Signing a long-term contract at a gym or exercise club could result in wasted money if resolve wanes and the membership is not used.  Also, costly home-exercise equipment might end up in the next garage sale. To test exercise staying power, first look for free or lower-cost options such as running, exercise tapes, taking the stairs instead of the elevator, parking far from the door, or joining the dog for a brisk walk. 
  • Save money:  A financial cushion can provide a safety net in times of emergencies, but paying double-digit interest on credit card balances is definitely the elephant in the room when it comes to saving.  To find money to begin or increase savings without taking away from debt repayment, each time an item is purchased on sale, put the amount saved into a designated savings account.  After all, savings from a sale isn't really savings at all unless it's tangible.
  • Start investing: Everyone needs to plan for their retirement, but an amateur playing a professional's game can be dangerous.  An effective way to build retirement security is to invest through monthly contributions to an employer's retirement plan.  On top of the tax advantages, these plans often include professional guidance which can be safer than independently investing.
  • Increase skills: It is no secret that student loan debt has a stronghold on many young adults who assumed that a good education would equal a good job, one that would provide enough income to repay the loan.  As an alternative to taking out a student loan, first explore which grants might be available, as a grant does not have to be repaid.  Also, consider skill centers which offer job retraining and teach computer courses, as many of these centers offer their services free of charge to consumers.  Obtaining additional CEUs (continuing education unites)  is another cost-effective way to improve skills and impress an employer.
The NFCC was founded in 1951. Use the resource link below to access its website.

Survive holidays on budget with H&FF Radio

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WASHINGTON (12/26/12)--Last Sunday's H&FF Radio prepared listeners for the holidays with party, charitable giving, and shopping tips.

The show, which you also can hear later via the Internet, features Paul Berry, Washington, D.C., journalist and broadcaster, discussed these topics with special guests:

  • "Holiday Party Survival Guide." Andrea Woroch, consumer expert, Kinoli Inc., Fort Collins, Colo., advised party hosts and guests about gift-giving and more.
  • "Seasonal Giving." Mark Bergel, founder and executive director of A Wider Circle, Silver Spring, Md., suggested end-of-year charitable giving strategies.
  • "10 Reasons to Give Cards." Kendal Perez, marketing coordinator, Kinoli Inc., Fort Collins, Colo., and a self-confessed shopaholic and bargain hunter, weighed in on the pros and cons of giving gift cards.
Home & Family Finance is a resource center for personal finance information at the Credit Union National Association (CUNA). The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 90 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "Holiday alert: Steer clear of CyberScrooge" and "Create a Spending Plan for a Special Holiday" in the Home & Family Finance Resource Center.

Fees coming to a checkout near you

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SAN FRANCISCO (12/26/12)--Consumers could soon see checkout fees for using credit cards at brick-and-mortar businesses and online merchants alike. A July settlement among nine major banks, Visa, and MasterCard gives merchants the right to pass the costs of processing credit card transactions on to consumers through checkout fees (Consumer Action Dec. 13).

Here are steps you can take to avoid checkout fees:

  • Shop around. Merchants are allowed to charge a fee equivalent to what they'll pay to accept your card, typically between 1.5% and 3% of the total purchase. Some merchants won't charge fees for using a credit or charge card. Before you get to the cash register, look for in-store signage or ask a sales person if you'll be charged a fee. If you will, consider shopping elsewhere.
  • Know your rights. By law, merchants can't surprise you with fees at the last minute, try to hide fees, or overcharge you. Retailers must provide clear disclosure of fees with signs at the store entrance, at the point of sale, and on the customer's receipt. Receipts must list the amount of the fee, a statement saying the merchant is imposing a fee, and reassurance that the fee isn't more than what it will cost the merchant to accept the card. Online merchants must disclose fees on their homepages. Checkout fees remain illegal in 10 states; see the resource links.
  • Request a discount. Don't hesitate to ask merchants that charge a fee for a discount.
Consumer Action recently published an online guide with information about checkout fees on its knowyourcard.org website.

For related information, listen to the Home & Family Finance Radio segment "Credit and Debit Cards: A Way of Life" in the Home & Family Finance Resource Center.

HandFF Radio talked ID theft eldercare on Sunday

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WASHINGTON (12/14/12)--Sunday's H&FF Radio discussed guarding your personal information during the holidays, helping elders stay in their homes and communities, and ensuring neck and back health.

The show, which you also can hear later via the Internet, featured Paul Berry, Washington, D.C., journalist and broadcaster, discussing these topics with special guests:

  • "ConsumerProtect@holidays." Scott Mitic, CEO of TrustedID, Redwood, Calif., suggested ways to protect yourself from identity theft while shopping for the holidays.
  • "Assisting Elders." Sandra Markwood, CEO of the National Association of Area Agencies on Aging (n4a), Washington, D.C., discussed eldercare for seniors.
  • "Health Care and Chiropractors." Dr. Michael Zuschnitt, chiropractor, Century Spine Center, Easton Md., talked about how chiropractic fits into your overall health care.
Home & Family Finance is a resource center for personal finance information at the Credit Union National Association (CUNA). The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 90 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "Elders Are Easy Targets for Scams" and watch "Guard Your Plastic Cards" in the Home & Family Finance Resource Center.

Avoid pesky fees

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NEW YORK (12/11/12)--Before you get slapped with a fee on top of what you thought was a final price, learn what you can do about hidden fees beforehand.  Shouldn't the price of an airline ticket include your luggage? Why should you pay $15 more for the Internet when you're already paying for a room in the hotel? What about those $34 overdraft fees? (MSNMoney Dec. 3)

Here are ways to get around some of the peskiest fees--ones that are unnecessary, give little in return, or are overpriced.

Financial institutions:

  • Overdrafts: If you make the occasional mistake of writing a check for more than you have in your account, your financial institution will charge you to cover the negative balance. To avoid fees or to pay less, check your balance regularly online and link your savings account to your checking account. Better yet, switch to a credit union--overdraft fees are, on average, $20 compared with $35 at a bank.
  • Foreign transactions: If you use your credit card in another country or buy something from a non-U.S. company, you will pay a fee, usually 3% of the transaction. Shop around for a card that doesn't charge this fee. Most credit unions charge no more than the 1% the card company charges them.
  • Other fees: Banks have found a lot of ways to get more money out of customers. Some charge as much as $100 a year simply for having a checking account. Add more fees if you want paper statements and to use an ATM. You'll do better at a credit union. Credit union fees, when they exist at all, typically are lower than bank fees. In addition, you'll pay less for loans and earn better dividends on savings.
Airline fees:

  • Checked baggage: Are you paying $25 to check a suitcase when you fly? Avoid the fees by flying Southwest and JetBlue, the two airlines that don't charge for baggage. Or choose an airline that doesn't charge baggage fees if you use its branded credit card.
  • Carry-ons: Two airlines, Spirit and Allegiant, charge a fee for carry-on bags. If it's not possible to avoid those airlines, look at the cost of shipping your bags--it might be a lot less.
  • Pet or lap fees: You'll be charged to bring kitty in a carrier whether you fly domestic or international. You most likely won't be charged for a baby younger than two in your lap if you stay in this country, but leave the U.S. and your lap fee can be as high as 10% of the price of a full-fare ticket. Shop around.
Rental cars:

  • Collision damage waiver: This expensive coverage can cost from $25 to $40 a day and the protection is limited. Check with your insurance agent and a credit card customer service representative to see what coverage you already have. You might be able to skip the added expense on domestic car rentals.
Hotels:

  • Resort fees: Hidden fees are against the law but some hotels assess them anyway—as much as $30 a night. If you pay to stay at a hotel, don't pay more for amenities such as use of the exercise room or pool, Internet access, or even newspapers. Before you book a room, get the facts on fees from a front-desk decision-maker (not the 800-number) and ask to have fees waived. If it's too late and you're already at the hotel, use any one of the many free apps to help you find the nearest free Wi-Fi hotspot.
For related information, read "Seven Questions to Ask Before Traveling Abroad" and watch the video "Money and Travel" in the Home & Family Finance Resource Center.

Mortgage payoffs e-clutter on HandFF Radio

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WASHINGTON (12/7/12)--Sunday's H&FF Radio talks about early mortgage payoffs, getting rid of digital clutter, and ensuring your holiday rental car is safe.

The show, which also can be heard later via the Internet, features Paul Berry, Washington, D.C., journalist and broadcaster, discussing these topics with special guests:

  • "Early Mortgage Payoff." Jackie Graham, agent for First Home Mortgage, Arlington, Va., suggests mortgage payment strategies.
  • "Electronic Organization." Jennifer Stewart, owner of Organizing by Jennifer, St. Louis, discusses how to eliminate digital clutter.
  • "Is Your Rental Car Safe?" Pamela Oakes, owner of Pam's Motor City Automotive, Detroit, reveals how to rent a safe auto for the holidays.
Home & Family Finance is a resource center for personal finance information at the Credit Union National Association (CUNA). The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is sponsored by America's credit unions and their 90 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "Seven Tips to Avoid Auto Breakdowns" and "More Seniors Carry Mortgage Burden" in the Home & Family Finance Resource Center.

Holiday alert Steer clear of CyberScrooge

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DULLES, Va. (12/4/12)--Online scams are more popular than ever during the holidays, putting online shoppers and mobile device users at increasing risk.

A study conducted in September by security company McAfee revealed that, of the 70% of consumers who plan to shop online this holiday season, 24% plan to hand over personal information in return for getting something of value (Huffington Post Nov. 22).

Of those planning to use smartphones or tablets to buy holiday gifts, more than half (54%) plan to use apps. Here's the humbug: Cybercriminals target mobile users through malicious applications, and 28% of smartphone and/or tablet owners admit they don't pay attention to app permissions.

Expect cybercriminals to cast a wider net beyond online shopping sites. Crooks target your credit card information and send viruses from text messages, fake classified ads  and bogus charities.

Even social media sites require vigilance; some contain gift card offers claiming to be from major retailers. Don't bite--the offers typically are scams to gain access to your social media account, opening the doors to any accounts you've tied that account to, or to post illegitimate offers on your behalf (NewsTribune.com Nov. 27).

Here are just a few of the most dangerous online scams to watch out for, courtesy of McAfee:

  • Social media scams: Be cautious about raffle contests, fan page deals advertising the hottest holiday gifts, installing apps just to get a discount, and Twitter ads using blind and shortened links that could be malicious.
  • Freebie offers: Steer clear of "Free iPad" offers or contests. The hype around iPhone 5, iPad Mini and other hot items is one trick cybercrooks use to get you to let your guard down and click on a dangerous link.
  • Skype message scare: A new Skype message scam--taking advantage of those connecting with loved ones during the holidays--attempts to infect your computer and hold your files for ransom. A change in the password-reset feature is keeping crooks at bay--for now (Yahoo!News.com Nov. 14).
  • Bogus gift cards: Don't buy gift cards online from third parties; the cards may be fraudulent.
  • Dangerous e-cards: That quick holiday greeting in your in-box might not be legitimate. Some e-cards contain malicious spyware or viruses that infect your computer if you click the link to view the greeting.
For a complete list of the "12 Scams of Christmas" and tips to protect yourself, use the link.

For more information, read "Protect Your Mailbox, ID This Holiday Season" in the Home & Family Finance Resource Center.