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How to Save Money

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Saving money is one of those tasks that's so much easier said than done. There's more to it than spending less money (although that part alone can be challenging). How much money will you save, where will you put it, and how can you make sure it stays there? Here's how to set realistic goals, keep your spending in check, and pay yourself first.


  1. Set savings goals. For short-term goals, this is easy. If you want to buy a video game, find out how much it costs; if you want to buy a house, determine how much of a down payment you’ll need. For long-term goals, such as retirement, you’ll need to do a lot more planning (figuring out how much money you’ll need to live comfortably for 20 or 30 years after you stop working), and you’ll also need to figure out how investments will help you achieve your goals.
    • Kill your debt first. Simply calculating how much you spend each month on your debts will illustrate that eliminating debt is the fastest way to free up money. Once the money is freed from debt payment, it can easily be re-purposed to savings.

  2. Establish a timeframe. For example: "I want to be able to buy a house two years from today." Set a particular date for accomplishing shorter-term goals, and make sure the goal is attainable within that time period. If it’s not attainable, you’ll just get discouraged.
  3. Figure out how much you’ll have to save per week, per month, or per paycheck to attain each of your savings goals. Take each thing you want to save for and figure out how much you need to start saving now. For most savings goals, it’s best to save the same amount each period. For example, if you want to put a $20,000 down payment on a home in 36 months (three years), you’ll need to save about $550 per month every month. But if your paychecks amount to $1000, it might not be a realistic goal, so adjust your timeframe until you come up with an approachable amount.
  4. Keep a record of your expenses. What you save falls between two activities and their difference: how much you make and how much you spend. Since you have more control over how much you spend, it's wise to take a critical look at your expenses. Write down everything you spend your money on for a couple weeks or a month. Be as detailed as possible, and try not to leave out small purchases. Assign each purchase or expenditure a category such as: Rent, Car insurance, Car payments, Phone Bill, Cable Bill, Utilities, Gas, Food, Entertainment, etc.
    • Keep a small notebook with you at all times. Get in the habit of recording every expense and saving the receipts.
    • Sit down once a week with your small notebook and receipts. Record your expenses in a larger notebook or a spreadsheet program.

  5. Trim your expenses. Take a good, hard look at your spending records after a month or two have passed. You’ll probably be surprised when you look back at your record of expenses: $300 on ice cream, $100 on parking tickets? You’ll likely see some obvious cuts you can make. Depending on how much you need to save, however, you may need to make some difficult decisions. Think about your priorities, and make cuts you can live with. Calculate how much those cuts will save you per year, and you'll be much more motivated to pinch pennies.
    • Can you move to a less expensive apartment or house? Can you refinance your mortgage?
    • Can you consolidate your debts so that you're not paying as much interest?
    • Can you save money on gas, or give up a car altogether? If your family has multiple cars, can you bring it down to one?
    • Can you get a better price on insurance? Call around and make sure you are getting the best price you can. Consider taking a higher deductible, too.
    • Can you drop a land line and either only use your cell phone or save money by calling over the internet for free with services such as Skype?
    • Can you live without cable or satellite TV?
    • Can you cut down on your utility bills?
    • Can you restrict eating out? Buy food in bulk? Start using coupons? Cook more at home? You might be able to save a lot of money on food.

  6. Reassess your savings goals. Subtract your expenses (the ones you can't live without) from your take-home income (i.e. after taxes have been taken out). What is the difference? And does it match up with your savings goals? Let's say you've decided you can definitely get by on $1500 per month, and your paychecks amount to $2300 per month. That leaves you with $800 to save. If there’s absolutely no way you can fit all your savings goals into your budget, take a look at what you’re saving for and cut the less important things or adjust the timeframe. Maybe you need to put off buying a new car for another year, or maybe you don’t really need a big-screen TV that badly.
  7. Make a budget. Once you’ve managed to balance your earnings with your savings goals and spending, write down a budget so you’ll know each month or each paycheck how much you can spend on any given thing or category of things. This is especially important for expenses which tend to fluctuate, or which you know you're going to have a particularly hard time restricting. (E.g. "I will only spend $30 a month on movies/chocolate/coffee/etc.")
  8. Stop using credit cards. Pay for everything with cash or money orders. Don't even use checks. It's easier to overspend when you're pulling from a bank or credit account because you don't know exactly how much is in there. If you have cash, you can see your supply running low. You can even bundle up the predetermined amount of cash allocated for each expense with a label or keep separate jars for each expense (e.g. a bundle/jar for coffee, another for gas, another for miscellaneous). As you pull money from a jar for that particular expense, you'll see how much remains and you'll also be reminded of your limit.
    • If you need to have credit cards but you don't want the temptation of having them available to use day-to-day, restrict that section of your wallet with a note or picture reminding you of your savings goals.
    • Credit cards are not inherently evil; it's all about your self control. If you use them responsibly (i.e. completely pay them off every month), you can benefit from them. But the reason most credit card companies make money, however, is because people end up spending money that they don't have. Unless you are one of the people who can religiously pay off the balance in full every month, you're better off foregoing the promotions that credit card companies use to lure you in (cash back, introductory APR, airline miles, and so on).

  9. Open an interest-bearing savings account. It’s a lot easier to keep track of your savings if you have them separate from your spending money. You can also usually get better interest on savings accounts than on checking accounts (if you get interest on your checking account at all). Consider higher-interest options such as CDs or money-market accounts for longer savings goals.
  10. Know where your money is. And how much of it, too. If you accidentally overdraw your bank account, you will incur hefty bank fees; worse yet, the place you paid with that check may slap a bounced check fee on top of that, and send the check in again, resulting in a second overdraft fee from the bank! So just a few cents missing to cover that check could result in over $100 in fees. To avoid that, you should always know how much money you've got in your account(s), so you never cut a check for more than what you have.
    • Look into checking and savings accounts that pay interest. Also, consider CDs (certificates of deposit) for longer-term savings with low risk.

  11. Pay yourself first. Savings should be your priority, so don’t just say that you’ll save whatever’s left over at the end of the month. Deposit savings into an account (or your piggybank) as soon as you get paid. An easy, effective way to start saving is to simply deposit 10% of every check in a savings account. If you get a check or sum of cash, say 710.68, move the decimal point one place to the left and deposit that amount: 71.07. This works well and requires little thought; over several years, you've a tidy sum in savings. Over decades, you'll be a millionaire.
    • You can set up an automatic transfer from your checking account to your savings account.
    • Many employers allow you to deduct savings from your paycheck. The money is directly deposited in your savings account so you never even see it on your paycheck.
    • You can also have investments for retirement taken directly out of your pay, and the taxes may be deferred with this option.



  • Always OVER estimate your expenses and UNDER estimate your income.
  • If you can afford to share things you have, from food to living space to appliances, try to do so. What goes around comes around when it's between close friends, soon enough, you'll find your friends doing the same, and everybody benefits.
  • Have a professional shopper go through your closet before you hit the mall. They will help you assess what you already have and what timeless items you can invest in to create more looks from those you already have. There are services that do this (e.g. Visual Therapy in NYC and TimePros in Los Angeles). Remember that this service can cost a pretty penny. Don't use this method unless you have a tendency to make $250 - $400 shopping trips!
  • Have a hobby? Match your funds. One important habit for saving is if you have a hobby, such as model airplanes, scrapbooking, dirt biking, scuba diving, etc., set a hard and fast rule that whatever you allow yourself to spend on your hobby, you match those funds to your savings. For example, if you buy yourself a $45 pair of riding gloves, another $45 goes to your savings. Serious about saving? Try doubling your matched funds! These savings plans will do two things: Save money regularly and quickly, and really show you how much you are spending on your hobby, when it costs you twice as much.
  • If you receive unexpected cash, put all or most of it into your savings, but continue to set aside your regularly scheduled amount as well. You’ll reach your savings goals sooner.
  • If you vacation normally, use the web to search for affordable vacation deals instead of paying full retail price. Some sites offer very discounted vacations by partnering with resorts across the country. Essentially, you are required to go on a 90 minute sales-pitch to buy a timeshare at the resort, and in exchange you receive an extra cheap luxury vacation and often freebies like theme park tickets, gas, or dinner certificates.
  • Make purchases with paper money, not exact change, and always save the change. Use a piggy bank or jar for your coins. Coins and change may look insignificant but when accumulated over time they can help you save. Some banks now offer free coin counting machines. When you redeem your coins, ask to be paid by check so you won't be tempted to spend your newfound cash.
  • Type in 'money savers' to your search engine and search around, you never know what might pop up.


  • Do not go out "window shopping" with any money on you. You will only be tempted to spend money you cannot afford to lose. Only shop with a predetermined shopping list.
  • After a long week of working, you may want to indulge in some luxury, telling yourself, "I deserve this". Remember that the things you buy are not gifts to yourself; they are trades, products for money. Say, "Of course I deserve this, but can I afford it? If I can't afford it, I'm still a worthy person, and I still deserve to meet my savings goals!"
  • Unless you're in truly desperate financial straits (like 10 seconds from eviction and your three children are starving) don't try to cut corners connected to health. Basic preventative care for yourself, your family, and your pets might cost you a $60 office visit or a $30 heartworm pill today, but the skipping it will contribute to expensive problems and heartache down the road.

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Article provided by wikiHow, a wiki how-to manual. Please edit this article and find author credits at the original wikiHow article on How to Save Money. All content on wikiHow can be shared under a Creative Commons license.

Identity theft

What is identity theft?

Identity theft occurs when someone uses your personally identifying information, like your name, Social Security number, or credit card number, without your permission, to commit fraud or other crimes.

The FTC estimates that as many as 9 million Americans have their identities stolen each year. In fact, you or someone you know may have experienced some form of identity theft.
The crime takes many forms. Identity thieves may rent an apartment, obtain a credit card, or establish a telephone account in your name. You may not find out about the theft until you review your credit report or a credit card statement and notice charges you didn’t make—or until you’re contacted by a debt collector.

Identity theft is serious. While some identity theft victims can resolve their problems quickly, others spend hundreds of dollars and many days repairing damage to their good name and credit record. Some consumers victimized by identity theft may lose out on job opportunities, or be denied loans for education, housing or cars because of negative information on their credit reports. In rare cases, they may even be arrested for crimes they did not commit.

How do thieves steal an identity?

Identity theft starts with the misuse of your personally identifying information such as your name and Social Security number, credit card numbers, or other financial account information. For identity thieves, this information is as good as gold.
Skilled identity thieves may use a variety of methods to get hold of your information, including:

  1. Dumpster Diving. They rummage through trash looking for bills or other paper with your personal information on it.
  2. Skimming. They steal credit/debit card numbers by using a special storage device when processing your card.
  3. Phishing. They pretend to be financial institutions or companies and send spam or pop-up messages to get you to reveal your personal information.
  4. Changing Your Address. They divert your billing statements to another location by completing a change of address form.
  5. Old-Fashioned Stealing. They steal wallets and purses; mail, including bank and credit card statements; pre-approved credit offers; and new checks or tax information. They steal personnel records, or bribe employees who have access.
  6. Pretexting. They use false pretenses to obtain your personal information from financial institutions, telephone companies, and other sources. For more information about pretexting, click here.

Smartmoney:Credit-Card Traps You Still Need to Watch For

President Obama signed the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009, marking a major milestone in consumers’ love-hate relationship with credit cards.The new rules go into effect in nine months (though some will kick in as soon as 90 days) and banks start curtailing the abusive practices this legislation reins in. Read on to find out what else might change for you as a consumer in terms of new fees, higher rates, change in grace periods, less rewards and the possibility of no more promotional rates.

In fact, as the new rules go into effect in nine months (though some will kick in as soon as 90 days) and banks start curtailing the abusive practices this legislation reins in, other practices will likely emerge that can hurt consumers just as badly. “The pendulum may have swung in the wrong direction”, says Dennis Moroney, research director and senior analyst for TowerGroup, a research and advisory-services firm focused exclusively on the financial-services industry. “The banks now have to respond to these changes.”

You may not like that response. Whether you use your credit cards as a tool to rack up free rewards points or you carry debt that you’re hoping to repay one day, you should watch out for new fees, higher interest rates, less generous rewards and fewer promotional offers. Here’s what you need to know.
Watch out for new kinds of fees

The new law prohibits over-limit fees (unless the cardholder agrees to allow transactions that exceed their limits). To make up for that lost revenue, banks will likely introduce other fees. “You will see a re-emergence of fees for all kinds of other services,” says Robert McKinley, founder of, which provides industry research and analysis. Among the fees cardholders should watch out for: fees for rewards programs and possibly even fees for checking your balance, he says.

Also, expect annual fees to make a comeback, says Moroney. In the 1980s, annual fees were standard, but were dropped as competition among card issuers heated up. Moroney predicts that some issuers will slap annual fees on all their credit cards, while others will tie the fee to spending thresholds, so that only big spenders get a free ride.

What cardholders should do: To protect against unpleasant surprises, examine credit-card statements and change-in-terms letters carefully. For now, card issuers can change terms at any time with 15 days’ notice, but once the new law is in effect, they will have to give 45 days’ notice.
Prepare for higher rates

Universal default allows card issuers to hike rates if a cardholder's credit score drops or if they make late payments on other accounts. Once the new legislation is in place, issuers will lose this powerful risk-management tool. Without the ability to hike rates if a cardholder's perceived risk level rises, card issuers will just start charging higher rates across the board, says Moroney.

“We’re going back to the kind of marketplace we had in the 1980s,” McKinley says. “You’ll see interest rates go back to the 19% to 20% range for most people.” The average variable-rate credit card today charges a 10.79% APR, according to

What cardholders should do: To avoid higher interest charges, consumers who carry a balance will have to shop around for lower rates -- perhaps in exchange for paying an annual fee, says Linda Sherry, a spokeswoman for Consumer Action, a nonprofit education and advocacy organization. Those who pay their balances in full each month shouldn't be affected, she says. To compare credit-card interest rates on new-card offers, use sites like, or
The end of grace periods?

The new legislation requires card companies to give consumers at least 21 days to pay their bills. But it doesn't require them to offer a grace period, which isn't the same as the cardholder’s due date — though the two usually coincide, says Chi Chi Wu, staff attorney with the National Consumer Law Center. While the due date designates the day by which a payment must be received for the cardholder to avoid a late-payment fee, the grace period is the time during which the cardholder isn’t charged interest.

McKinley says card issuers may get rid of grace periods altogether, so that cardholders who pay their balances off each month will start paying interest immediately after making a purchase. “The industry has for many years wanted to get rid of the grace period on convenience users,” he says.

What consumers should do: The only way to avoid interest charges if this happens is to stop using credit cards altogether, says Wu.
Say goodbye to 0% APR promotions

Low or 0% introductory APR offers have been a boon to diligent card users who played the balance-transfer game. Banks were able to offer those deals thanks to the card users who made a late payment before the offer expired, triggering the bank’s penalty rate of 20% or more. Now that banks won’t be allowed to increase interest rates on existing balances — and all promotional offers have to last for at least six months — these promotions will likely disappear, McKinley says. At best, consumers with excellent credit may receive introductory rates in the 6% range.

What cardholders should do: If you have a low-APR offer right now, be on your best behavior: Send payments on time and don’t do anything to trigger a penalty rate such as exceeding your credit limit.
Rewards programs will be less rewarding

Credit-card companies have already been scaling back on rewards programs. Once the new legislation kicks in and they feel the squeeze of lower revenue from penalty fees and interest charges, they’ll become even less generous. Spending thresholds will likely go up, Moroney says, so you'll have to spend more to earn miles, points or cash back. Banks may also adopt more stringent rules, such as wiping out your rewards balance if you make a late payment.

What cardholders should do: If you’ve accumulated a sizable amount of miles, points or cash back and worry that your card may scale back its program, it may be smart to redeem your rewards now — while the free lunch is still available.

for more information

How to Invest

from wikiHow - The How to Manual That You Can Edit

Whether you have $20 or $200,000 to invest, the objective is the same: to make your money grow. The means, however, vary dramatically based on the amount of money being invested, the state of the market, and your own investing style.


  1. Pay off high interest debt. If you have a loan or credit card debt with a high interest rate (over 10%) there's no point in investing your hard-earned cash. Whatever interest you earn through investing (usually less than 10%) won't make much of a difference because you'll be spending a greater amount paying interest on your debt.[1] For example, let's say Sam makes has saved $4,000 for investing, but he also has $4,000 in credit card debt at a 14% interest rate. He could invest the $4,000 and if he gets a 12% ROI (return on investment--and this is being very optimistic) in a year he'll have made $480 in interest. But the credit card company will have charged him $560 in interest. He's $80 in the hole, and he still has that $4,000 principal to pay off. Why bother? Pay off the high interest debt first so that you can actually keep any money you make by investing. Otherwise, the only investors making money are the ones who loaned it to you at a high interest rate.
  2. Build your emergency fund. If you don't have one already, it's a good idea to focus your efforts on setting aside 3-6 months of living expenses just in case. This is not money that should be invested; it should be kept readily accessible and safe from swings in the market. You can split your extra money every month, sending part of it to your emergency fund and part of it to your investing fund. Whatever you do, don't tie up all of your extra money in investments unless you have a financial safety net in place; anything can go wrong (a job loss, an injury, an illness) and failing to prepare for that possibility is irresponsible.
  3. Write down your investment goals. While you're paying down high interest debt and building your emergency fund, you should think about why you're investing. How much money do you want to have, and in what period of time? Different investors have different goals, such as:

  4. Choose your investments. The bigger the chunk of money you have available for investing, the more choices you have. Most people diversify by investing in more than one place, but the way they split their investments depends on their goals and the amount of risk they're willing to accept.
    • Savings accounts - low minimum balance, liquid but with limitations on how often the account is accessed, low interest rate (usually much lower than inflation), predictable
    • Money market accounts (MMAs) - higher minimum balance than savings, liquid but with limitations on how often the account is accessed, earns about twice the interest rates of savings accounts,[2] high-yield MMAs offer higher interest rates but higher risks
    • Certificates of deposit (CDs) - similar to savings account but with higher interest rates and restrictions on early withdrawal, offered by banks, brokerage firms and independent salespeople, low-risk but reduced liquidity, may require high minimum balance for desired interest rates
    • Bonds - a loan taken out by a government or company to be paid back with interested; considered "fixed income" securities because the same income will be generated regardless of market conditions,[3] you'll need to know the par value (amount loaned), coupon rate (interest rate), and maturity rate (when the principal and interest must be paid back)
      • Stocks - usually purchased through brokers; you buy pieces (shares) of a corporation which entitles you to decision-making power (usually by voting to elect a board of directors), you may also receive a fraction of the profits (dividends)#*Dividend reinvestment plans (DRPs aka Drips) and direct stock purchase plans (DSPs) - bypass brokers (and their commissions) by buying directly from companies or their agents, offered by more than 1,000 major corporations,[4] can invest as little as $20-30 per month, can buy fractions of stocks, can be high-risk.

    • Real estate property - ties up money (not easy to liquidate investment), capital intensive (usually leveraged through mortgage loans)
    • Mutual funds - not insured by any government agency, built-in diversification, some funds have low initial purchase amounts, you'll have to pay fees
    • Real Estate Investment Trusts (REITs) - similar to mutual funds, but instead of investing in stocks, they invest in real estate

  5. Save money to invest. If you don't already have money set aside for investing, you'll need to build up your investment fund. By now, you should know how much money you'll need to reach your goals, given the risks you've chosen to undertake.
  6. Buy low. Whatever you choose to invest in, try to buy it when it's "on sale"--that is, buy when no one else is buying. For example, in real estate, you'll want to purchase property when it's a buyer's market, which is when there's a high proportion of properties for sale versus potential buyers. When people are desperate to sell, you have greater room for negotiation, especially if you can see how the investment will pay off when other's don't (or perhaps they do, but can't afford to act on it at the time).
  7. Hold on tight. With more volatile investment vehicles, you may be tempted to bail. It's easy to get spooked when you see the value of your investments plummet. If you did your research, however, you probably knew what you were getting into, and you decided early on how you were going to approach the swings in the market place. Some people prefer to hold on no matter what, and others set a value at which they'll jump ship. Keep in mind, however, that when you're selling your investments out of fear, so is everyone else, and your exit is someone else's opportunity to buy low.
  8. Sell high. If and when the market bounces back, sell your investments. Roll the profits over into another investment (buying low, of course) and try to do so under a tax shelter that allows you to re-invest the full amount of your profits (rather than having it taxed first). In the U.S., examples would be 1031 exchanges (in real estate) and Roth IRAs.

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Sources and Citations





Article provided by wikiHow, a wiki how-to manual. Please edit this article and find author credits at the original wikiHow article on How to Invest. All content on wikiHow can be shared under a Creative Commons license.

III your Credit and Insurance

What does my credit rating have to do with purchasing insurance?
Credit scores are based on an analysis of an individual’s credit history. Insurers often generate a numerical ranking based on a person’s credit history, known as an “insurance score,” when underwriting and setting the rates for insurance policies. Actuarial studies show that how a person manages his or her financial affairs, which is what an insurance score indicates, is a good predictor of insurance claims. Insurance scores are used to help insurers differentiate between lower and higher insurance risks and thus charge a premium equal to the risk they are assuming. Statistically, people who have a poor insurance score are more likely to file a claim.

Your credit history can work for you or against you. Your proven ability to manage your money and meet your financial obligations is an indication of your maturity and stability and can open many doors. Prospective employers, landlords, lenders and even your insurance company view a strong credit history as a positive sign that you will meet your obligations and responsibilities to them as well. A poor credit history could result in not getting that apartment or dream job, and paying more for insurance coverage and higher interest rates on your mortgage and other loans.

IRS: Top Ten facts about the Tuition and Fees Deduction

The Tuition and Fees deduction of up to $4,000 is available to help parents and students pay for post-secondary education. Below are ten important facts about this deduction every student and parent should know.

  1. You do not have to itemize to take the Tuition and Fees deduction. You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A.
  2. You may be able to claim qualified tuition and fees expenses as either an adjustment to income, a Hope or Lifetime Learning credit, or – if applicable – as a business expense.
  3. You cannot take the tuition and fees deduction on your income tax return if your filing status is married filing separately.
  4. You cannot take the deduction if you are claimed, or can be claimed, as a dependent on someone else's return.
  5. The deduction is reduced or eliminated if your modified adjusted gross income exceeds certain limits, based on your filing status.
  6. You cannot claim the tuition and fees deduction if you or anyone else claims the Hope or Lifetime Learning credit for the same student in the same year.
  7. If the educational expenses are also allowable as a business expense, the tuition and fees deduction may be claimed in conjunction with a business expense deduction, but the same expenses cannot be deducted twice.
  8. You cannot claim a deduction or credit based on expenses paid with tax-free scholarship, fellowship, grant, or education savings account funds such as a Coverdell education savings account, tax-free savings bond interest or employer-provided education assistance.
  9. The same rule applies to expenses you pay with a tax-exempt distribution from a qualified tuition plan, except that you can deduct qualified expenses you pay only with that part of the distribution that is a return of your contribution to the plan.
  10. IRS Publication 970, Tax Benefits for Education, can help eligible parents and students understand the special rules that apply and decide which tax break to claim. The publication is available at or by calling 800-TAX-FORM (800-829-3676).

Links: 10 tips for getting the best financial aid package

Get Tax Help

For more information, check out these resources:

Read these publications online from FCIC:


* Names of resources and organizations included in this online article are provided as examples only, and their inclusion does not mean that they are endorsed by the Federal Citizen Information Center or any other Government agency. Also, if a particular resource or organization is not mentioned, this does not mean or imply that it is unsatisfactory.

Get FREE Tax Help

Free Tax Help

There are lots of free tax help programs out there for people who need it. The IRS offers a guide of tax services. Some highlights:

Volunteer Income Tax Assistance Program (VITA)

VITA offers free tax help for low-to-moderate income earners ($42,000 and below) who cannot prepare their own returns. To locate the nearest VITA site, call (800) 829-1040.

Tax Counseling for Seniors

Free tax help for senior citizens from trained volunteers. Call (888) 227-7669 to locate an AARP Tax-Aide site in your neighborhood.

Low Income Taxpayer Clinics (LITCs)

LITCs provide help to low income taxpayers, either free or at nominal cost. Some non-English assistance provided. The IRS has more information on low income tax clinics in your area.

Military Personnel Resources

The Armed Forces Tax Council (AFTC) offers free tax help for members of the Army, Air Force, Navy, Marine Corps, and Coast Guard, and their families. Visit this IRS page for general information about notifying the IRS on overseas deployment, and learn about combat zone tax benefits and other items.

E-File your taxes


E-file logoAccording to the IRS, 90 million people filed their taxes electronically in 2008. There are many advantages to e-filing your taxes – it’s easier, it reduces the risk of error and you’ll receive your refund faster (especially if you use direct deposit to receive your refund electronically). According to the IRS, e-filing is “virtually error-proof with an error rate of less than one percent.” There are three ways to e-file:

Go to a Tax Professional

See an authorized e-file provider who can electronically file e-files your taxes for you, usually at a fee. Fees may vary depending on the tax professional you choose and the specific services requested.

Do it Yourself on your Computer

Use purchased / free software on your home computer.

Free File (IRS)

If you made less than $56,000 in 2008, you can e-file your taxes directly with the IRS through their Free File program. It offers:

  • Free service
  • Services in English / Spanish
  • Automatic accuracy checks
  • Quick refunds (sometimes less than 10 days)

Note: Free File only works with your Federal taxes – you still need to file your state taxes.

What if you cannot pay your taxes?

If you have lost your job, your home or are in serious debt, the thought of paying taxes on top of all this may make you want to pull your hair out. The IRS has released the following resources to answer questions about paying taxes while under financial duress.

Example: What if I can’t pay my taxes?
“Don’t panic. If you cannot pay the full amount of taxes you owe by the April deadline, you should still file your return by the deadline and pay as much as you can to avoid penalties and interest. You also should contact the IRS to discuss your payment options at 1-800-829-1040.”

Job Related

What if I lose my job?
What if I receive unemployment compensation?
What if my income declines?
What if I am searching for a job?
What if my employer goes out of business?
What if I close my own business?
What if I withdraw money from my IRA?
What if my 401(k) drops in value?

Debt Related

What if I lose my home through foreclosure?
What if I sell my home for a loss?
What if my debt is forgiven?
What if I am insolvent?
What if I file for bankruptcy protection?

Tax Related

What if I did not receive an economic stimulus payment?
What if I can’t pay my installment agreement?
What if there is a federal tax lien on my home?
What if a levy on my wages is creating hardship?
What if I can’t resolve my tax problem with the IRS?
What if I need legal representation to help with my tax problem but can’t afford it?

2008 Tax Changes

Some of the tax changes you’ll see from the IRS are relief for first-time homebuyers, green tax credits and tax relief for areas of the Midwest affected by natural disasters. Here is a quick summary of some of the more significant changes:

Stimulus Payments are Tax-Free

If you received an economic stimulus payment in 2008, good news - you don’t need to report them on your taxes (i.e. they are not taxable). You still need to list the amount you received on your tax forms – it’s listed as the recovery rebate credit on line 70 on form 1040, and on line 42 on 1040A.

Note: Receipt of a stimulus payment can affect whether you are able to claim a Recovery Rebate Credit. You might be eligible for one if, for example, you had a child last year, or you didn’t receive an economic stimulus payment.

Alternative Minimum Tax Exemption is Increased

The Alternative Minimum Tax (AMT) applies only when certain types of income are earned. For 2008, the AMT levels increased slightly:

  • $69,950 for married couples filing a joint return or qualifying widows and widowers (up from $66,250 in 2007)
  • $34,975 for a married person filing separately (up from $33,125)
  • $46,200 for singles or heads of household (up from $44,350)

If you make more than this amount, and if you take various deductions, you should spend a few minutes and use the IRS AMT Calculator to see if you owe the AMT. No, it’s not fun to do your taxes again, but until the tax law changes it’s your responsibility.

Green Tax Breaks

If you use solar power, solar water heating, fuel cells or wind energy on your property, you might qualify for the residential energy-efficient property credit. Some additions may allow up to $2,000 in credits. Use IRS form 5695 to claim it.

Got a hybrid? Are you the first owner? Check the Alternative Motor Vehicle Credit on the IRS site to see if you qualify.

Standard Deduction Increased for Most Taxpayers

In some cases, taxpayers choose to take the basic standard deduction rather than itemizing all of their deductions. The basic deduction has increased to:

  • $10,900 for married couples filing a joint return and qualifying widows or widowers
  • $5,450 for singles or married couples filing separate returns
  • $8,000 for heads of household

First-Time Homebuyer Credit

If you bought a house recently or are considering buying one, you may be eligible for a first-time homebuyer credit worth up to $7,500.

Note: The credit is actually more like a no-interest loan because it must be repaid to the government over 15 years.

Tax Relief for Midwest Disaster Areas

The Heartland Disaster Tax Relief Act of 2008 was created to help Americans affected by the storms, tornados and flooding that struck the Midwest between May 20, 2008, and July 31, 2008. If you live in portions of Arkansas, Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska and Wisconsin and were affected by these events, be sure to examine some of the major provisions available to you.

Standard Mileage Rates Adjusted for 2008

Auto mileage can be expensed at:

  • Business
    50.5 cents per mile driven from Jan. 1, 2008, to June 30, 2008
    58.5 cents per mile driven from July 1, 2008 to Dec. 31, 2008
  • Medical / moving
    19 cents per mile driven from Jan. 1, 2008, to June 30, 2008
    27 cents per mile driven from July 1, 2008 to Dec. 31, 2008
  • Charitable mileage rate is 14 cents per mile.

Farmer’s / Self-Employment Tax Changes

If you are self-employed, receive Social Security or disability benefits, and are eligible for the Conservation Reserve Program (typically for farmers and ranchers), you are exempt from the 15.3-percent social security self-employment tax. See the Farmer’s Tax Guide for use in preparing your 2008 returns.

FDIC- Is your money safe?

What Is the FDIC?

The FDIC – short for the Federal Deposit Insurance Corporation – is an independent agency of the United States government. The FDIC protects you against the loss of your deposits if an FDIC-insured bank or savings association fails. FDIC insurance is backed by the full faith and credit of the United States government. The term “insured bank” is used in this brochure to mean any bank or savings association with FDIC insurance.

To check whether your bank or savings association is insured by FDIC, call toll-free 1-877-275-3342, use "Bank Find" at, or look for the official FDIC sign where deposits are received.

FDIC Official Teller Sign

Generally, individual depositors are insured up to $250,000. (This level of insurance is in effect until December 31, 2009). The Federal Deposit Insurance Corporation (FDIC) will help you determine whether your bank is federally insured and the exact amount of your deposit insurance. If you do business with a credit union, you may contact the National Credit Union Administration (NCUA) for the same information.

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NEW: Homeowner Affordability and Stability Plan

On Tuesday, February 10th, Treasury Secretary Timothy Geithner outlined a comprehensive plan to restore stability to our financial system. In the address, Secretary Geithner discussed the Obama Administration’s strategy to strengthen our economy by getting credit flowing again to families and businesses, while imposing new measures and conditions to strengthen accountability, oversight and transparency in how taxpayer dollars are spent. And Secretary Geithner explained how the financial stability plan will be critical in supporting an effective and lasting economic recovery.

You can get information about the President's Homeowner Affordability and Stability Plan at The $75 billion Stability Plan is a federal program to prevent mortgage foreclosures. But, beware! There are organizations offering consumers home loan counseling or help getting a Stability Plan loan for a fee, usually paid in advance. The Department of Housing and Urban Development (HUD) and HOPE NOW offer free and safe counseling services and can help you apply for assistance under the Stability Plan.

For more information, please visit

Homeowner Affordability and Stability Plan Executive Summary PDF Icon

Homeowner Affordability and Stability Plan Fact Sheet PDF Icon

Helping Homeowners Under the Homeowner Affordability and Stability Plan: Three Cases PDF Icon

Homeowner Affordability and Stability Plan Questions and Answers PDF Icon

Cell Phone Use While Driving
Fact Sheet

* Using cell phones while driving is a very high risk behavior with significant impact on crashes and society. More than 50 peer-reviewed scientific studies have identified the risks associated with cell phone use while driving.

* Drivers who use cell phones are four times more likely to be in a crash while using a cell phone. (1997 New England Journal of Medicine examination of hospital records and 2005 Insurance Institute for Highway Safety study linking crashes to cell phone records).

* There is no difference in the cognitive distraction between hand-held and hands-free devices. (Simulator studies at the U. of Utah.)

* Cell phone use contributes to an estimated 6 percent of all crashes, which equates to 636,000 crashes, 330,000 injuries, 12,000 serious injuries and 2,600 deaths each year. (Harvard Center of Risk Analysis).

* 80 percent of crashes are related to driver inattention. There are certain activities that may be more dangerous than talking on a cell phone. However, cell phone use occurs more frequently and for longer durations than other, riskier behaviors. Thus, the #1 source of driver inattention is cell phones. (Virginia Tech 100-car study for NHTSA)

* It is estimated that more than 100 million people use cell phones while driving. (CTIA – The Wireless Association reports 270 million cell phone subscribers. A Nationwide Insurance public opinion poll showed 81 percent of the public admit to talking on a cell phone while driving).

* The annual cost of crashes caused by cell phone use is estimated to be $43 billion (Harvard Center for Risk Analysis).

* Talking to a passenger while driving is significantly safer than talking on a cell phone. (University of Utah)

* Many businesses understand the risk and are already taking action. Among NSC members that responded to a survey, 45 percent (651 of 1453 respondents) said their companies had a cell phone policy of some kind. Of those, 22 percent said they re-engineered their processes to accommodate the policy and 85 percent said the policy did not affect productivity.

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FBI: Don’t be Fooled by Work-at-Home Scams

The FBI and the Internet Crime Complaint Center (IC3) continue to receive numerous complaints from individuals who have fallen victim to work-at-home scams and remind consumers to be vigilant when seeking employment online.

These work-at-home schemes are designed by criminals to gain the trust of job seekers in order to take advantage of working relationships to further illegal activity. Most victims do not even realize they are engaging in criminal behavior until it is too late.

In many of the reported scams, victims are often hired to “process payments,” “transfer funds,” or “reship products.” However, these scams exploit unwitting employees by having them cash fraudulent checks, transfer illegally obtained funds for the criminals, or receive stolen merchandise and ship it to the criminals.

Other scams entice victims to sign up to be a “mystery shopper,” receiving fraudulent checks with instructions to cash the checks and wire the funds to “test” a company’s services. Victims are told they will be compensated with a portion of the merchandise or funds.

Job scams also often provide criminals the opportunity to commit identity theft when victims provide their personal information, sometimes even bank account information, to their potential “employer.” The criminal/employer can then use the victim’s information to open credit cards, post on-line auctions, register websites, etc., in the victim’s name to commit additional crimes.

“Don’t get duped by these criminals offering easy money. Remain skeptical of unsolicited job offers that sound too good to be true and report any scams you might encounter,” said Richard Kolko, FBI National Press Office.

To receive the latest information about cyber scams, please go to the FBI website and sign up for e-mail alerts by clicking on one of the red envelopes. If you have received a scam e-mail, please notify the IC3 by filing a complaint at For more information on e-scams, please visit the FBI's New E-Scams and Warnings webpage at or
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National Auto Fraud and Theft Prevention System Goes Live

WASHINGTON—The U.S. Department of Justice today announced the availability of an online computer system to help protect states and consumers from automobile fraud and to provide law enforcement with new tools to investigate fraud, theft, and other crimes involving vehicles. The National Motor Vehicle Title Information System, or NMVTIS, will be available for consumers on January 30, 2009 and will be accessible through third party, fee-for-service websites. The Office of Justice Programs’ (OJP) Bureau of Justice Assistance (BJA) administers NMVTIS in coordination with the Federal Bureau of Investigation (FBI).

The system allows state motor vehicle administrators to verify and exchange titling and brand data and provides law enforcement officials, consumers, and others with critical information regarding vehicle histories. Consumers now have access to the vehicle’s brand history, odometer data, and basic vehicle information and can be redirected to the current state of record to access the full title record if available. Law enforcement can track the vehicle’s status from state to state by accessing the system directly.

According to the National Insurance Crime Bureau, car theft is a profitable business generating nearly $8 billion a year. Along with implementing this system, the Department has outlined the various responsibilities and reporting requirements for states, auto recyclers, junk yards and salvage yards, and insurance carriers. The Department has designed the system consistent with federal law that requires that the system be paid for through user fees and not dependent on federal funding.

Since 1997, the Department of Justice has committed over $15 million to assist states and other stakeholders in the implementation of NMVTIS. Currently, NMVTIS has the participation, or partial participation, of 36 states. Ultimately, with full participation from all 50 states and the District of Columbia, NMVTIS will prevent stolen motor vehicles, including clones, from entering into interstate commerce; protect states and consumers from fraud; reduce the use of stolen vehicles for illicit purposes including fundraising for criminal enterprises; and provide consumer protection from unsafe vehicles. In research conducted by the Logistics Management Institute, the system is estimated to save taxpayers between $4 and $11 billion each year. For further information on NMVTIS, visit

The Office of Justice Programs, headed by Acting Assistant Attorney General Laurie Robinson, provides federal leadership in developing the nation's capacity to prevent and control crime, administer justice, and assist victims. OJP has five component bureaus: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; and the Office for Victims of Crime. Additionally, OJP has two program offices: the Community Capacity Development Office, which incorporates the Weed and Seed strategy, and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART). More information can be found at

EPA- Fuel Efficient Cars

Fuel-efficient models come in all types and sizes, so consumers can save thousands of dollars over a vehicle’s lifetime without sacrificing performance. Included in the 2009 fuel economy leaders are diesel vehicles certified to EPA’s tightest emissions standards. Consumers now have access to the cleanest diesels ever available in the U.S. marketplace.

Each vehicle listing in the Fuel Economy Guide provides an estimated annual fuel cost. The online guide includes an interactive feature that allows consumers to insert their local gasoline prices and typical driving habits to receive a personalized fuel cost estimate. Fuel economy estimates now include the revised test methods implemented in model year 2008. These revised tests better reflect “real world” driving conditions and habits, including higher highway speed limits and use of accessories such as air conditioning.

For the first time, the Fuel Economy Guide is available to mobile users (, and is readily accessible from a mobile device, smart phone, or personal digital assistant (or PDA).

More online sources with fuel economy information:
Joint DOE/EPA Fuel Economy website for detailed information on fuel economy, including a complete version of the Fuel Economy Guide to download:

Comprehensive information about EPA’s Fuel Economy program:

The Green Vehicle Guide website to locate the cleanest and most fuel efficient vehicles:

The 2009 fuel economy leaders within each class as well as the lowest fuel economy models:

Pet Health Insurance for Cats & Dogs

10 Things You Must Keep in a Fireproof Safe

from LegalZoom
Author(s): Sherry Ciurczak

The images from the recent wildfires in California are heartbreaking—families fleeing their neighborhoods at a moment's notice, people returning to find their homes reduced to ashes and their most precious possessions gone forever. With help pouring in from all over the country, Californians are already starting to rebuild.

But the threat of fire isn't unique to California. In fact, the US Fire Administration estimates that fires nationwide caused more than $11 billion in property damage in 2007. Although 91% of Americans agree it's important to prepare for a disaster, only slightly more than half have taken steps to do so.

One great way to make sure you're prepared is to get a fireproof safe. What should you store it in? Here's a list of the top 10 suggested items to keep in your fireproof safe:

  1. Current insurance policies and agent contact information. You'll need this information right away if your house suffers damage in a fire.

  2. Your family's passports and original birth certificates. These can be a hassle to replace and will come in handy to establish your identity for other purposes.

  3. A list of your family's doctors, prescription medications, and contact information for all pharmacies you use. You may need these to get new supplies of medications you use on a regular basis.

  4. CDs or an external hard drive containing digital copies of all family photos. It's a good idea to scan all older family photos and keep a digital copy of them as well. Your family memories as preserved in photos are irreplaceable.

  5. Safety deposit box keys. If you store valuables at the bank, you'll want to make sure you can access them in the event of an emergency.

  6. Important papers related to investments, retirement plans, bank accounts, and associated contact information. You may need ready access to funds.

  7. Information on your outstanding debts, due dates, and contact information. It's important to keep tabs on your finances and protect your credit, even if you're displaced by a fire.

  8. Original Social Security cards. These can be difficult to replace and may be needed to establish eligibility for aid.

  9. Copies of your important legal documents, including powers of attorney, living wills, health care proxies—both for yourself and for anyone else for whom you are designated attorney-in-fact or health care surrogate. Having access to these can help ensure the protection they were created to provide.

  10. Copy of family wills and all wills in which you are designated the executor. It's important to safeguard wills so that loved ones are taken care of.

LegalZoom Can Help You Prepare