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Thinking Like a Rich Person, Telecommuting On H&FF Radio

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WASHINGTON (3/29/13)--This week H&FF Radio teaches you to think like a rich person, explores whether working from home is a good idea and cautions against sharing too many spring break pictures on Twitter and Facebook.

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

  • "Use Your Tax Refund like a Rich Person." Professional speaker and consultant Steve Siebold, author of the book "How Rich People Think" and co-founder of the consulting firm Gove-Siebold Group, Boynton Beach, Fla., says putting your tax refund in savings isn't necessarily the best use of the money and suggests some alternatives.
  • "Is Working From Home the Future?" Corporate speaker and author Linda Galindo, Park City, Utah, explains why some bosses say telecommuting works great but still want to see their employees in the office.
  • "Online, Your Past Can Haunt You." Cybersecurity expert Jessie Varsalone, a professor at Baltimore County College, warns that what young people share through social media could prevent them from landing competitive jobs. Varsalone says companies regularly screen applicants' social media activity before making job offers.
Home & Family Finance is a resource center for personal finance information at 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 "Decide What to Pay for Growth Stocks" and "Step Carefully: Covering Digital Footprint Is Key to Web Privacy" in the Home & Family Finance Resource Center.

IRA Contribution Deadline Fast Approaching

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MADISON, Wis. (3/27/13)--The federal tax filing deadline is right around the corner and, while it may be too late to take advantage of many 2012 tax-saving strategies, there still is time to save with an Individual Retirement Account for 2012--if you act soon.

You have until April 15 to make a 2012 IRA contribution. Doing so will bring you one step closer to a more secure retirement--and you might even receive a tax deduction or a tax credit for making your contribution.

"Even if you cannot make the full IRA contribution, take a tax deduction, or receive a tax credit for your contribution, you still may want to consider making an IRA contribution, no matter what the dollar amount," according to Dennis Zuehlke, compliance manager for Ascensus in Middleton, Wis. The company provides retirement plan services to financial organizations nationwide.

"Americans' confidence in their ability to retire comfortably is at historically low levels, so any contribution to an IRA, regardless of the amount, is better than none at all," Zuehlke added.

You can contribute to a traditional IRA if you are younger than age 70½ and have earned income. You can contribute to a Roth IRA regardless of your age, provided that you have earned income and your modified adjusted gross income (MAGI) for 2012 is less than $125,000 if single, or $183,000 if married filing a joint tax return.

The 2012 IRA contribution limit is $5,000. If you reached age 50 by the end of 2012, you can make an additional catch-up contribution of $1,000, for a total contribution of $6,000. However, if your earned income for 2012 is less than $5,000 (or $6,000 if age 50 or older), then the amount of your contribution cannot exceed your total earned income.

If you contribute to a traditional IRA, all or part of your contribution may be tax-deductible. Whether your contribution or a portion of your contribution is deductible depends on whether you are an active participant in an employer-sponsored retirement plan, your marital status, and your MAGI. If both you and your spouse are not active participants in an employer-sponsored retirement plan, then your entire contribution is tax-deductible. If either you or your spouse is an active participant, then you may not be able to deduct the full amount of your IRA contribution, depending on your filing status and MAGI.

With a Roth IRA, contributions are never deductible. But all qualified distributions and even some nonqualified distributions from a Roth IRA may be taken tax-free.

Regardless of whether you contribute to a traditional IRA or Roth IRA, you may be eligible for a tax credit. The saver's tax credit is a nonrefundable credit to help offset the cost of the first $2,000 contributed to a traditional or Roth IRA. To be eligible for the credit, you must have reached age 18 before the end of 2012, not be a full-time student or dependent, and have an adjusted gross income (AGI) within certain limits. For 2012, single filers with an AGI of less than $28,750 ($43,125 for head of household filers, $57,500 for joint filers) are eligible for a credit of 10%, 20%, or 50% of the first $2,000 of their traditional or Roth IRA contribution. This credit is in addition to any tax deduction for making a traditional IRA contribution.

New Credit Scoring System Helps Consumers

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LOS ANGELES (3/26/13)--You have a poor credit history, or none, so you can't get a loan, right? Not true anymore. The three major credit bureaus--Experian, Equifax and TransUnion--have teamed up to create a new scoring model for calculating credit scores in the 3.0 version of VantageScore (KABC-TV March 18).

Lenders use your credit score to determine your ability to handle financing, similar to a mortgage or car loan. VantageScore 3.0 might help you and millions of others establish a credit history, access loans, and perhaps boost scores.

While the traditional and most popular scoring model, the FICO score, still will be around, the VantageScore is gaining ground. Seven of the top-10 financial institutions, six of the top-10 credit card issuers, and four of the leading auto lenders and mortgage lenders are using it today.

Here's what you should know about VantageScore 3.0 and FICO:

1. Paid-off collection accounts matter. If you settled or paid a collection account in full, VantageScore will not count it against your score--as long as the balance is zero. FICO will factor it in for as many as seven years, even if you pay it off.

2. Previously unqualified consumers benefit. The new VantageScore system could help you qualify for more competitive credit rates by weighing rent, utility and telecom payment records. If you have a very limited credit history, you are invisible to FICO.

3. Natural disaster victims get a break. If you're the victim of a natural disaster, VantageScore 3.0 allows you to benefit from good credit behaviors, such as making payments on time. The new system will protect you against negative accounts by ignoring them. FICO ignores both positive and negative accounts, making it difficult for you to improve your score.

4. New scoring range aligns with FICO. VantageScore is changing its scoring range to align with FICO's 300-to-850 range. Earlier versions of the VantageScore system ranged from 501 to 990. This mismatch often caused confusion for American consumers and lenders.

FICO may take up some of VantageScore's methods. The agency has announced that it will begin looking into ways of factoring in alternative records to calculate scores for those without or with limited credit history.

Investing In Lean Times, Tax Day Advice On H&FF Radio

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WASHINGTON (3/25/13)--Sunday H&FF Radio dug into how to invest during sequestration, steeled for the rapidly advancing April 15, and planned the perfect vacation.

In this episode, which you can listen to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discussed these topics with special guests:

  • "Sequestering Your Dollars." Michael Farr, president of investment firm Farr, Miller & Washington, Washington, D.C., imparted some financial wisdom about where--and where not--to put your dollars during these times of government austerity. Farr also explained why the market is making leaps and bounds amid so much uncertainty.
  • "The Tax Man Cometh." Eric Smith, a spokesperson for the Internal Revenue Service, Washington, D.C., reminded listeners T-Day, April 15, is imminent and shared changes in the tax rules that could affect their filing.
  • "Travel Like an Expert." Susan Tanzman, president of Martin Travel & Tours, Los Angeles, gave the dos and don'ts of planning a successful vacation. 
Home & Family Finance is a resource center for personal finance information at Credit Union National Association. 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 "EITC can help taxpayers, if they're aware" and "Do You Need a Travel Agent?" in the Home & Family Finance Resource Center.

Keep Credit Intact: Dispute Report Errors

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NEW YORK (3/19/13)--An error on your credit report can cost you more than just the time it'll take to correct it. That error also could result in a lower credit score, which could mean you'll pay higher interest rates on loans or be denied outright. Getting slapped with an undeserved high-interest rate happens to about 5% of consumers who have credit report errors (New York Times.com March 4).

Credit reports and credit scores, while different, work in sync. A credit report shows your credit activity over time. It shows if you owe money and to whom. It also shows whether you make payments on time or if you're late; it shows if you've stopped making payments altogether. Based on information in your credit report, a credit score is a three-digit number lenders use to assess whether or not to offer you credit and at what price. Negative credit information, accurate or inaccurate, can result in a lower score.

If you have a low credit score, you'll pay more to acquire a loan, but that's not the only way a low score affects your finances. A low score also can result in not being able to rent an apartment, get affordable insurance coverage, or get a job.

The first steps in making sure your score is the score you deserve are to review your credit report for accuracy and to report any discrepancies, according to the National Foundation for Credit Counseling (NFCC), Silver Spring, Md. Follow this advice to make sure your report is clean:

  • Check your credit report. You can request one free report a year from each of the three major credit reporting bureaus by visiting annualcreditreport.com. This is the only website officially authorized to provide credit reports. You also can call 877-322-8228 or complete a request form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. Stagger the reports every four months in rotation so you can keep tabs throughout the year. Review your report at least three months before you make a potentially affected financial move so you have time to dispute any errors and have them corrected.
  • Review your report for accuracy. Look for errors, large and small, as well as omissions such as an account that you paid but didn't get credit for. Verify the basics such as name, Social Security number, and address.
  • Know your rights. The Fair Credit Reporting Act (FCRA) gives you free access to your credit report within 60 days if you've been denied a loan, insurance, or a job based on information in your report. It's up to you to initiate the dispute process.
  • If you find an error, file a dispute with the credit reporting agency. File the dispute in writing so you will have a paper trail. In your dispute, include your full name and address, what you want investigated, the disputed items, and an explanation of why you think the information is inaccurate. FCRA generally requires credit reporting companies to investigate items in question within 30 days to 45 days of when the dispute was filed.
  • Understand that accurate negative information won't be removed. Negative information that is true will stay on your report. Credit reporting agencies can report most negative information for seven years; bankruptcies can remain on your report for 10 years.
  • Stay clear of credit repair companies. There is no such thing as a quick fix and there's nothing that a credit repair business can do for you that you can't do for yourself--for free. Most credit repair companies charge high fees and rarely deliver results.
For help reviewing your credit report ask the staff at your credit union or call an NFCC member agency certified counselor. Call 800-388-2227 to be connected to an agency in your area, or visit DebtAdvice.org.

For more information about disputing credit report errors, read "Clean Up Your Credit Report" in the Home & Family Finance Resource Center.

On H&FF Radio: Personal Toll Of Sequestration, 7 Financial Warnings

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WASHINGTON (3/16/13)--It was danger ahead on H&FF Radio, as Sunday's show digs into sequestration's impact on average Americans and seven signs your family's finances are on the brink of ruin.

In this episode, which you can listen to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discusses these topics with special guests:

  • "HSA Highlights." Mark Baker, health savings account specialist, UnitedHealthcare's Golden Rule Insurance Co., Indianapolis, broke down HSAs: what they are, their tax benefits, why they're increasingly popular, and how to acquire one.
  • "The Personal Cost of Sequestration." Dr. Barbara O'Neill, a personal finance professor at Rutgers University, New Brunswick, N.J., explained the impact the federal government's austerity measures could have on family budgets and how to prepare for it.
  • "Seven Financial Warning Signs." Susan Tiffany, certified credit union financial counselor and director of consumer periodicals, Credit Union National Association, Madison, Wis., said routine overdraft charges and arguments about money are warning signs your family's financial ship is headed for an iceberg.
Home & Family Finance is a resource center for personal finance information at 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 "March Financial Fitness Challenge--7 Financial Warning Signs You Can't Ignore" and "Fast Fact: Average Money Mistake Price Tag: $23,000" in the Home & Family Finance Resource Center.

Good Deeds, IRA Changes, And Dental Health On H&FF Radio

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WASHINGTON (3/11/13)--Sunday's H&FF Radio featured the latest news on IRA contributions, the importance of regular visits to the dentist, and an American-born Israeli philanthropist's plan to change the world through good deeds. 

In this episode, which  can be listened to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discussed these topics with special guests:

  • "No Amount Is Too Small." Dennis Zuehlke, manager of the retirement-planning firm Ascensus, Madison, Wis., said the 2013 contribution limit for an IRA has increased to $5,500, but reminded listeners to contribute whatever they can afford.
  • "Healthy Teeth, Happy Wallet." Sheila Dobee, a dentist in Fremont, Calif., discussed the importance of routine dental care to a family's overall health and finances.
  • "Activate Your Goodness." Shari Arison, an American-born Israeli businesswoman and billionaire, discussed her book "Activate Your Goodness," and its message that good works can transform the world for the better.
Home & Family Finance is a resource center for personal finance information at 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 "Four Key Steps to "No Regrets" Retirement" and "Don't Miss Out on Retirement Plan Pretax Dollars" in the Home & Family Finance Resource Center.

Grandparents Can Plan Estates, Pay For College

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NEW YORK (3/12/13)--With the number of parents capable of saving for their children's college education dwindling, financial planners are pitching grandparents on the benefits of college-savings plans.

According to Sallie Mae, about 14% of all families with children younger than age 18 used the college-savings 529 plans last year--unchanged from 2010, the last time the student loan lender published the report (MarketWatch Feb. 28.) Moreover, the deposits are small and getting smaller, down to $1,770 on average in 2012--a 6% drop in two years.

Traditionally, 529 plans are used by parents to save for their children's education. But the state-sponsored tax-advantaged investment accounts can be an attractive estate-planning tool, an efficient way for a senior to transfer assets while contributing to a grandchild's education.

Some of the benefits of 529 plans:

  • You can contribute $70,000 tax-free upfront--five times more than the maximum tax-free gift--and, depending on the state, the 529 contribution could be eligible for a tax deduction or credit.
  • As the 529 account owner, you retain control of the account  and are the only one who can make withdrawals, even though after five years the money is no longer considered part of your estate.
  • You can use the account for nonqualified educational expenses, but the gains will be taxed at regular income rates and incur a 10% penalty.
Grandparents considering using a 529 plan can take steps to minimize its impact on their grandchild's student-aid application. Grandparent-funded 529 plans are assessed heavily, either as a student asset or as student income at 25% to 50% a year, resulting in significantly less student aid (Forbes Feb. 28).

To avoid this outcome, grandparents can transfer the account to a 529 plan controlled by their grandchild's parents before the first student aid application is due. Parental 529 plans are assessed at 5% to 5.6% and do not show up as income for either the student or parents.

For example, if Grandma transferred $100,000 from her account to a 529 plan controlled by her granddaughter's father, it would cost the grandchild $5,000 on her first student aid application, as opposed to $25,000 or $50,000 had Grandma retained control

Plan ahead. A few states don't allow a transfer in account ownership, though it's usually possible to roll over the assets to a 529 plan in another state that does.

For more information, read "Do You Need a Financial Plan?" in the Home & Family Finance Resource Center.

ID Fraud Claims 126 Million Victims In 2012

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NEW YORK (3/5/13)--Identity fraudsters made off with $21 billion from 12.6 million victims in 2012. Overall, slightly more than one of 20 consumers, 5.26%, learned they were victims last year (NBC News Feb. 20).

Javelin Strategy and Research's 2013 Identity Fraud Report released in February identified a 50% increase in the incidence of new account fraud, where the thief uses your personal information to fraudulently open new credit cards or loans in your name. Despite that dramatic increase, the study's author reported that simple credit card fraud still accounts for roughly two-thirds of all identity fraud.

Data breaches are especially troublesome. Almost one out of four consumers who received a data breach notification last year became a fraud victim. If you received a notice that your Social Security number was compromised by a data breach, you were five times more likely than other consumers to be a victim of identity fraud, and 14 times more likely to become a victim of new-account fraud.

Tablet owners are 80% more likely than all other consumers to become fraud victims, which researchers attributed to tablet users being younger and less risk-averse than older consumers.

How do crooks obtain your information? Still most common are traditional methods such as stolen wallets and "familiar frauds" where the victim knows the perpetrator who has access to statements or other legal documents.

What's your best defense?

  • Protect your mobile device. Install antivirus/anti-malware software to protect personal information you store and transmit. Make sure your operating systems are the latest versions, because updates patch security holes. And install or enable a passcode lock on your smartphone.
  • Be social-media smart. While on social networking sites, don't reveal personal details that crooks can use to crack security questions for your financial accounts and credit card logins. Verify that apps don't access any personally identifiable information.
  • Be wary of Wi-Fi. Don't access financial accounts in public Wi-Fi hotspots such as cafés, public libraries, or airports; 7.4% of consumers who did in the past 12 months became fraud victims, compared with 4.6% who did not.
  • Stay safe offline. Secure your financial records at home in a locked storage device. Shred paper documents that contain sensitive information. Request electronic statements and use online bill pay and direct deposit. Don't put checks in an unlocked mailbox. And opt out of preapproved credit offers--call 888-5-optout (888-567-8688).
For more information, read "Tax ID Theft: One Million Fraudulent Returns Expected" in the Home & Family Finance Resource Center.

Making Life Changes, Saving For Retirement On H&FF Radio

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WASHINGTON (3/1/13)--Listen to H&FF Radio this Sunday for small changes that can improve your career and seven steps to ensure you're saving enough for retirement.

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

  • "The 5 Degree Principle." Shannon Cassidy, author of the new book "The 5 Degree Principle" and director of the leadership-development firm Bridge Between Inc., Philadelphia, discusses her step-by-step guide to achieving lasting life and career changes that she's used successfully with her executive clients.
  • "The 7 Steps to a Healthy Retirement." Jane Clark, a senior editor with the magazine Kiplinger's Personal Finance, Washington D.C., says more companies are automatically enrolling employees in 401(k)s but cautions that most Americans need to save harder and longer.
Home & Family Finance is a resource center for personal finance information at 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 "Ten steps to fiscal fitness in 2013" and "Learn to Evaluate Financial Information" in the Home & Family Finance Resource Center.