Stay home on Black Friday; Buy Alternative Gifts

 Black Friday is NOT the best day for holiday gift deals. As a follow up to the Nov. 10 post reporting the study by the Wall Street Journal, NPR this evening confirmed with another authority that Friday does not offer the best prices. It's appalling that so many retailers open on Thanksgiving Day when low paid employees (often with few or no benefits) are forced to work when they could be home with the families. It's long past time to take a more sustainable approach to holiday gift giving. Avoid the crowds, sleep late on Friday (if you don't have to work), and check out Alternative Gifts International: http://www.altgifts.org/

Skipping a Loan Payment is a BAD Idea

It's that time of year again when financial institutions encourage you to think they are doing you a favor by offering to let you skip a loan payment. All this does is increase their profits because you end up paying more interest. Just day NO!

Why you’re often better off saving for retirement than buying a home

Is homeownership the best way to build wealth? Not for many. A study by HelloWallet found that many would have generated more personal wealth by renting a home and investing their money in tax-advantaged accounts.  As reported in The Washington Post http://www.washingtonpost.com/news/get-there/wp/2014/11/11/why-youre-often-better-off-saving-for-retirement-than-buying-a-home/ U.S. home prices lost 43% from 2005 to 2012, yet the vast majority of Americans consider home ownership to be a good idea and the best way to build wealth. But is it? For half of current homeowners—the answer is no, according to a new study by HelloWallet. People in those households would have built more wealth by renting and investing their money in 401(k)s, IRAs or other tax-advantaged investments.  Most of the income tax breaks go to the highest earners, thus low to moderate income households subsidize the wealthy. View:  House of Cards: The Misunderstood Consumer Finance of Homeownership http://www.hellowallet.com/research/house-of-cards

Can you hear the outcry from the real estate industry? So, young adults, think carefully about committing a huge chunk of your future paychecks to the biggest, most expensive house that you can possible “afford” (according to the real estate sales person and mortgage broker who will collect their fat commission at closing and don’t care if you can afford the house in the long run).  Once they have children most Americans aspire to live in a single family house. It’s true that the rental stock is not the same as the stock of homes for sale. Just don’t get suckered into thinking you’re going to get a big tax break. As the study authors point out, the mortgage tax deduction is ripe for revision to end subsidies for the well-off that encourage building of large, unsustainable houses.

Holiday hype differs from pricing reality. Stay Home on Black Friday!

Based on data from 4,500 retail websites from 2008 to the present, The Wall Street Journal reports that Black Friday is NOT the day for best prices; in fact, you are likely to find items out of stock if you shop that day. So stay home and get caught up on sleep; spend time with your family. Celebrate Buy Nothing Day instead.

• Last year's biggest price cuts came the Sunday before Thanksgiving and the day before Turkey day. 
• The weeks before Black Friday offered better deals that the weeks before Christmas.
• You are likely to find items OUT of Stock on Black Friday.
• You can follow prices of 10 popular holiday gifts with the WSJ's Christmas Sale Tracker: http://graphics.wsj.com/Christmas-Sale-Tracker
• Shop at the Alternative Gift Market instead: http://www.altgifts.org/. Logan's AGM events will be Saturday, Nov. 22 at the Presbyterian Church (Center St. & 200 West), 9 a.m. - 2 p.m.
• BTW abundant research shows that your $ is much better spent on experiences than on possessions (remember that much of the most hyped holiday gifts end up taking up valuable storage space and eventually...in the landfill).

young or old, Get started or boost your retirement planning with Financial Planning for Women

You’re never too young (or it’s never too late) to plan for retirement/refirement/the next phase/your later years… to figure out a retirement plan (whatever you want to call that phase of life when you can reinvent yourself)

Although FPW focuses on the financial side of life, we recognize that there is much more to the later years than money. You will come away with resources to help you: invest for financial security in later life and understand the importance of starting NOW, (funny) book suggestions to guide your financial and life planning, great websites with excellent tools, and motivation to get going! So come to FPW November 12 and bring a friend, S.O., daughter, sister, mother or spouse. Erica will address strategies and planning for those under 50 and Jean will focus on the over 50 stage. We can’t promise to provide a complete plan in an hour or so but we’ll provide the resources for you to get started and the motivation to continue your planning for a robust later life.

Newcomers and those who bring new participants will receive a “reward” in the form of recent issues of Money or Kiplinger’s magazines or other financial planning resources.
Details at http://www.usu.edu/fpw/

Women Benefit from Financial Advice

"Women are less confident about retirement than men, save less for retirement, and often say they don’t know what to do to improve retirement planning — but give them the right advice and their behaviors change.That’s according to a survey conducted by TIAA-CREF, which found that women’s confidence concerning retirement increases substantially, and their behavior changes, when they’ve gotten financial advice," as reported by Marlene Satter: http://www.benefitspro.com/2014/10/29/advice-spurs-women-on-retirement-planning?ref=hp
"The problem is that while the number of women who want financial advice is on the increase — 33 percent of respondents said they did, compared with only 24 percent in 2013 — they don’t know where to go to get it."  So check our the reliable resources in this blog and attend Financial Planning for Women.

Can't we talk about something more pleasant?

Dealing with the final years of life can be a real trial but you can't help laughing about Roz Chast's sad tale of her parents' last years. Roz Chast is a cartoonist for The New Yorker so the book is illustrated like a comic.  The account of her parents’ final years is hilarious, sad, disturbing and thought provoking. I have not laughed so hard (about stuff that isn't really funny) in ages! The photos of her parents' stuff really sent me over the edge! Hilarious, ridiculous, and way too familiar.   It's the kind of final years and death we all want to AVOID at all costs. I came away feeling grateful that my experience with my parents was nowhere near this bad (and far less expensive). Read a preview at: http://projects.newyorker.com/story/chast-parents/

Stock Market Volatility

S&P 500 Losses of 10% or More Since 1950
Total Occurrences: 28 Times
Average Loss: -21.6%
Median Loss: -16.5%
Average Length: 7.8 Months
Greater Than 20% Loss: 9 Times
Greater Than 30% Loss: 5 Times
If your portfolio is heavily invested in stocks you need to be ready for the wild ride. If you can't stomach such a loss (remember, it's only on paper unless you panic and sell), it's time to re-set your asset allocation to a more conservative mix.
Thanks to Lon Jefferies for the S&P data "The next market correction? Remember the ace up your sleeve." http://networthadvice.com

7 Commandments of Holiday Shopping

Sorry to raise this topic so soon after Halloween but the December issue of Consumer Reports arrived with 7 spending rules to help avoid problems when holiday shopping.
1. Thou shalt manage receipts. (needed for returns, warranties, proof of purchase) in a paper or computer folder.
2. Thou shalt use credit cards Which provide fraud protection. Don't buy just to build up more points or frequent flyer miles.
3. Thou shalt keep track of rebates. read the fine print and follow the detailed instructions to the letter. You often have to jump through ridiculous hoops to get the rebate.
4. Thou shalt not take on debt. Do i need to say anything more? If you can't afford it don't buy it! Give gifts of time or homemade treats. If you haven't had my Christmas granola, you're in for a treat.
5. Thou shalt not fall victim to hype.  Stay home or go for a hike on Black Friday. Avoid the crowds and over priced (50% off!! Off what?) merchandise that will end up in the land fill shortly. Where are last year's must have toys?? Research by Consumer Reports found prices FELL after Black Friday!
6. Thou shalt not become a target... for ID theft. Don't give out personal info! Avoid the incessant marketing that will ensue if you provide your phone or email address to retailers. Lots on this blog about avoiding ID theft.
7. THOU SHALT NOT GIVE GIFT CARDS!!! Often loaded with fees (to buy, to use, and when you don't use them. The recipient is restricted to a specific retailer and they can't save part of what they receive. Maybe they really need cash to pay bills rather than another sweater. Give cash or a check instead and let the recipient decide what they need/want.

How to Fix Social Security

Confused about Social Security? Worried that it won't be there for you? Frustrated with the lack of action by Congress to deal with the looming financing problems? Wondering who to believe?
The non-partisan Center for Retirement Research at Boston College has updated their easy to understand educational tool to clear up the confusion and point the way toward a reasonable solution: "Everything the earnest but overburdened citizen needs to know about the Social Security financing shortfall and the leading proposals for addressing the problem." Enjoy learning about SS with this colorful, clear explanation of the problems and solutions: http://crr.bc.edu/wp-content/uploads/2011/08/SS-Fixit_9.4.14_WEB.pdf
It being election day, voters need to pressure their members of Congress to stop focusing on obstruction and work together (like we were taught in kindergarten) to address this important issue.