TURNING LOSERS INTO TAX SAVINGS...

From Kiplingers March 2008:

Losing money on an investment can be painful, but there is a positive side, you can use the losses to lower your tax bill.  In fact, cutting your losses instead of waiting for a bad investment to recover can be a savvy tax-saving strategy.    Here's why:  each dollar of losses offsets an equal amount of taxable capital gains, you can also offset taxes on up to $3000 of ordinary income ($1500 if you're married and filing separately) if your losses are high enough.  And if you still have losses left over, you can save them and use them to offset taxes in future years.

Paper losses don't count.  To use this strategy, you have to actually sell an investment, such as a stock or fund, for less than you paid.  That's why it makes sense to periodically purge losing positions that look hopeless.  "You want to do this throughout the year," says Janice Johnson, a tax consultant in New York City.  "You don't want to be caught selling at the end of the year when prices may be depressed."

Other losers I would like to get tax savings for:

1.  All the time I've spent watching reality TV (except The Nanny & Wife Swap)

2.  "The Heartbreak Kid" starring Ben Stiller

3.  My last blind date

THE LONGER YOU WAIT, THE LONGER IT WILL TAKE TO GET STIMULATED...

Putting off getting your taxes done may be costing you some sleep, may cost you penalties and finance charges, but it will delay your ECONOMIC STIMULUS PAYMENT, since payments are based on your tax return.

To receive a payment, taxpayers must have a valid Social Security number, $3,000 of income and file a 2007 federal tax return. IRS will take care of the rest. Eligible people will receive up to $600 ($1,200 for married couples), and parents will receive an additional $300 for each eligible child younger than 17. Millions of retirees, disabled veterans and low-wage workers who usually are exempt from filing a tax return must do so this year in order to receive a stimulus payment.

The IRS has a handy Economic Stimulus Payment Calculator on their site if you would like to see what your payment will be. Cool.

STAMP OUT HUNGER ON SATURDAY, MAY 10th...

The US Postal Service and Campbell Soup Company are getting together for a food drive on Saturday, May 10th. Participating is easy. Simply leave non-perishable food items in a sturdy bag (no expired items or glass bottles please) in front of your mail box and your mail carrier will pick it up. Your donation will be taken to a local food bank. Could it be any easier? Spread the word to your friends and neighbors. There are helpful downloads available at helpstampouthunger.com including a flyer for posting at work or around your neighborhood, and a Pledge Sheet and Collection Chart to get students excited and involved with the cause. You can even sign up to get a reminder email the day before. Last year the program delivered over 70 million pounds of food!

WHERE'S MY TAX REFUND? YOU CAN FIND OUT ONLINE...

It's April, bringing heartburn to some (probably most of us) who push doing our taxes right up to the deadline, and anticipation to others who are waiting for their return. Can't do much to help with the heartburn except recommend mint tea and better planning next year, but to those wondering where their return is, guess what? You can find it online! Just click here to go to the IRS INDIVIDUALS page and follow the instructions. You have to wait at least three weeks since you filed electronically or six weeks if you filed by mail, to get your answer.

To get to your personal refund information, be ready to enter your:

• Social Security Number (or IRS Individual Taxpayer Identification Number)
• Filing status (Single, Married Filing Joint Return, Married Filing Separate Return, Head of Household, or Qualifying Widow(er))
• Exact refund amount shown on your return

Don’t fall for any email scams about your refund! IRS never initiates emails!

STAGGERING CREDIT REPORTS...

Oprah has AHA! and WOW! moments, sometimes I have DUH! moments. Here is my latest. I realized it was May and I had not done my annual check of my credit reports and FICO scores (I usually check them every January to start my year off right). I like to use annualcreditreport.com because it makes the process so simple. Here is a one stop shop to get your yearly FREE credit report from all three reporting agencies; EXPERIAN, TRANSUNION, and EQUIFAX. Just go to the site and follow the simple instructions. You also have the option of paying to get your FICO score from each agency ($6 - $8 each).

A couple of days later I was watching the TODAY show and hear Jean Chatsky mention that you should STAGGER getting your reports - one every 4 months - so you can keep an eye on any new negative or illegal activity. Of course! That makes so much sense. Keeping an eye on errors is a huge part of protecting your credit rating. According to a 2004 study (the latest available) by the Public Interest Research Groups, or PIRG, as many as 79% of credit reports have errors — 29% of which are serious enough to potentially result in a credit denial!

Click here for further information from SmartMoney.com about the importance of your credit report and how to improve it.

MEET MONEY GIRL....

Here is one of my favorite things on the web, MONEY GIRL, QUICK AND DIRTY TIPS FOR A RICHER LIFE. This podcast is part of the QUICK AND DIRTY TIPS series, which are short and informative podcasts that can be downloaded onto your computer or MP3 player via their website or iTunes, FOR FREE! You can also read the transcripts as well as get additional resource information about the topic on the website. Why do I like this so much? Because it is convenient, very informative, and QUICK!

Enjoy the current installment entitled GOOD DEBT VERSUS BAD DEBT: Do you know what distinguishes good debt from bad debt?

THE CREDIT CRISIS...WHAT THE...?

Since the writers strike I have had more time to pay attention to what all the experts are saying about the economy as I wait to get back to my job (as well as go through my piled up issues of Martha Stewart, and learning how to cut my own cuticles). I have watched many hours of CNBC and spent as much time online hearing the opinions of people a lot smarter than me give complicated explanations and totally opposite views on the outcome of it all. In the end I think I get the gist of it, at least enough to know how it is effecting me in the broad strokes so I can manage Eve's personal economy accordingly.

That's why I love articles like this from the New York Times:

Can’t Grasp Credit Crisis? Join the Club

By DAVID LEONHARDT

Published: March 19, 2008

Raise your hand if you don’t quite understand this whole financial crisis.

It has been going on for seven months now, and many people probably feel as if they should understand it. But they don’t, not really. The part about the housing crash seems simple enough. With banks whispering sweet encouragement, people bought homes they couldn’t afford, and now they are falling behind on their mortgages.

But the overwhelming majority of homeowners are doing just fine. So how is it that a mess concentrated in one part of the mortgage business — subprime loans — has frozen the credit markets, sent stock markets gyrating, caused the collapse of Bear Stearns, left the economy on the brink of the worst recession in a generation and forced the Federal Reserve to take its boldest action since the Depression?

I’m here to urge you not to feel sheepish. This may not be entirely comforting, but your confusion is shared by many people who are in the middle of the crisis.

Read More

AGRESSIVLEY WORK THAT INVESTMENT ACOUNT, EVEN AFTER 40...

I have a significant birthday coming up this year. As a result I have become increasingly aware of talk show subjects such as "Love and Dating, EVEN after 40," "Feeling and looking your best EVEN after 40," "Feeling vital and worthwhile, and good for anything EVEN after 40." Ok I made up that last one up, but I actually heard the other two. I am starting to look forward to 40, not a lot, but a little. Maybe I will finally feel like a grown up, or maybe not, EVEN at 40.

Suggestions for those who need to play catch up in their retirement planning after 40.
from O Magazine:

The obvious advice from our panel to anyone who is behind in her savings is to spend less and save more, but John Claghorn has a further suggestion: " If you are going to be working for another two decades, and you are not going to be withdrawing money from your 401(k) or IRAs to buy a home or pay college tuition, invest as aggressilvly as you can tolerate.

IN YOUR 30'S - MAX IT OUT FOR RETIREMENT...

Here's my story. I started contributing to a Roth IRA ten years ago. I thought I was totally on track because I maxed out my allowable contributions each year. Here is where I was clueless... I left it sitting in the Money Market account offered by the Custodian at the time, TD Waterhouse, and didn't invest it for several years. I might have done just as well growing that money if I had put it under my mattress! Bad idea. Money Markets sometimes earn far less interest than a regular Savings Account does. Now I know better, but I wish I would have read this article way back when...


From O Magazine - Amanda Robb
Now's the time to max out your contributions to your retirement accounts (if you haven't already). The easiest way to choose an appropriately aggressive retirement plan in to invest in a "lifecycle" or "lifestyle" fund -- one that automatically adjusts your holdings to less risky investments based on the number of years until you retire, says Suze Orman. For a rough idea of how much you'll need for retirement, Eric Tyson offers three scenarios:

1. You'll need 65 percent of your projected preretirement income if you save 15 percent of you annual income, are a high-income earner (generally more than $100,000), will own your home debt-free when you retire, and plan to live modestly in retirement.

2. You'll need 75 percent if you save 5 to 14 percent of your annual income and want to maintain your preretirement lifestyle.

3. You'll need 85 percent if you save less than 5 percent of your annual income, have to pay a mortgage or rent in retirement, and want to maintain your current lifestyle.

JUST IN CASE YOU DIDN'T GET IT...WHAT TO DO IN YOUR 20'S

JUST in case you didn't get the March 2008 copy of O magazine, or JUST in case you skipped over the money articles starting on pg 162 because you had already read the whole rest of the thing and had dropped it in the tub a few times (that may just be me), I am going to give you the good stuff.

When it comes to retirement, "IS IT EVER TOO EARLY TO START WORRYING ABOUT LATER?"

You've heard it before: The most important thing is to invest in a 401(k) or other retirement account, and if you can't afford to contribute $15,500 to your 401(k) (the 2008 limit), at least set aside enough to maximize the amount your company will match. The challenge is to pick the right funds. "Choose your employer's most aggressive 401(k) fund," says John Claghorn, at RBC Dain Rauscher (Suze Orman's financial adviser). "The biggest mistake people make is being too cautious, especially when they're young." Susan Burke recommends: "Make sure your 401(k) fund has both U.S. and International stocks. The U.S. economy is growing more slowly than others, so you need to be globally diversified."

Two things...Suze Oreman has a financial adviser? Wow, that just goes to show you can never know too much about your money...and second, I wonder why they didn't mention the maximum you can contribute to your IRA in 2008? It's $5000 by the way.

Doesn't the above graph say it all? A better title for the article would have been START EARLY, AND DON'T WORRY ABOUT IT LATER!

TOMORROW...WHAT YOU SHOULD BE DOING IN YOUR 30's.

SUZE AND OPRAH ARE GIVING IT TO YOU FOR FREE...!

This is not an Urban Legend or rumor, I actually saw it on Oprah today (one benefit to me of the writers strike, I am catching up on my Oprah viewing).

Until Thursday, February 14th (tomorrow) by 5pm Pacific Time, you can get a FREE download of the entire book WOMEN & MONEY from Suze Orman.  Click on the book to go there, scroll half way down the page to where it says "download your free copy," and there you go.  The book is over 300 pages long, so please think about reading it on your computer in order to save trees.  It's available in English and Spanish.  You will kick yourself if you don't get this book - did I mention that it is FREE!!!  Tell your friends.  

EMPOWER WOMEN, CHANGE OUR WORLD...!

What can you do to improve the lives of women, if someone gives you $5,000 to start? Avon will give you that chance with their HELLO TOMORROW FUND:

What are YOU doing to change the world?

The Avon Hello Tomorrow Fund is an initiative of Avon Products, Inc. with the goal to empower women and improve society by providing individuals with cash awards that will allow them to pursue a project or initiative to better the lives of women (of all ages) in the United States.

Each week the Fund provides one $5,000 award to an individual who has submitted a compelling application that advances the interests of women and ultimately improves society. Applications will be accepted on an ongoing basis and award winners' stories will be shared with the world through avon.com and other promotions related to the Hello Tomorrow Fund.

I am going to apply. You should apply. You know you have good ideas on how to improve the world around you, think about it! Spend some time during your workout, your lunch break or your shower thinking of what you could do (instead of your thighs which is what I think about during all three of those activities), even putting that energy into the Universe is a good start.  Tell your friends, apply with a friend!  DO IT!

PROJECT LIFELINE, HELP FOR HOMEOWNERS IN TROUBLE...

Help is on the way:

"Project Lifeline," backed by the U.S. Treasury and Department of Housing and Urban Development, would pause foreclosure proceedings for borrowers more than 90 days in arrears while services determine whether they could make payments under new terms, the lenders said in a statement.

The effort would cover all types of home loans, unlike an earlier plan aimed at freezing interest rates for subprime mortgage holders who cannot afford rates that reset to higher levels.

Watch video, and read more as the plan is announced in greater detail throughout the day.

GETTING IN SHAPE, WITH CASH...

This morning I was looking through my new Shape magazine for my workout o' the week (I have a short workout attention span), I came across this blurb...

The average American woman under the age of 35 loses track of $2,709 in cash each year, according to a study conducted by Visa - meaning you spend $52 a week without realizing where it's gone. 

My first thought to myself was "wow", my second was "I think I probably do that," and my third was "I wonder why the cut off is 35 year old, I bet women older than that lose even more, because maybe they have more..."?  In any case, I am going to keep tabs for a couple of months on where my cash goes so I can cure my "financial amnesia."   Here are the suggestions made by Janet Bodnar, author of Kiplinger's Money Smart Women for 3 easy ways to save big:

1.  KEEP A RECORD - You don't have to write down your expenses forever, just do it for a month to see where you're bleeding funds.  You will probably be surprised.

2.  RESTRICT YOUR CASH FLOW - Start by taking a set amount out of the ATM, but tell yourself it has to last the week.  You'll think harder about purchases when you have a limited supply of money.  (My girlfriend Lou just told me she does that, and it helps her keep her spending down because she has to lay out cash, and eliminates the fear of her credit card bill).

3.  WAIT IT OUT - If you're shopping and see something you like, leave the item at the store overnight.  If you still want it the next day, go back for it.  You shouldn't deprive yourself, but you should be making conscious choices.

I would just add to #3, IF you have it in your budget, and IF you can afford it.  I am still obsessing over the Michael Kors "Astor Grommet" satchel ($498!!!), but I want a condo even more, so it will have to wait.