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Loan Forgiveness for Teachers

Jill Hare | Editor, TheApple — Fri, 19 Jun 2009 12:04:00 -0700

TheApple has researched and compiled a complete list of states that offer loan forgiveness for teachers. Not all states offer loan forgiveness, but there are federal programs that may help teachers erase school debt.

State list in alphabetical order:

A-C

D-I

J-N

O-Z

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Alaska

Alaska Teacher Education Loan

The Alaska Legislature established the Teacher Education Loan (TEL) to encourage Alaska high school graduates to pursue teaching careers and to teach in Alaska rural elementary and secondary schools. There is up to 100% loan forgiveness to qualifying borrowers and a $7500 annual limit.

Get qualified to teach in this state now.

Source: http://www.alaskadvantage.state.ak.us/page/254

Arkansas

Get qualified to teach in this state now.

Arkansas Geographical Critical Needs Minority Teacher Scholarship

Minority students may receive up to $1,500 per academic year for four years or the completion
of a degree if they agree to teach in the Delta or an area of the state designated as having a
critical shortage of teachers by the State Board of Arkansas

Contact: Linda Harris ● 870.575.8256 ● harrisl@uapb.edu

Arkansas EdLoan for Teachers

A special student loan repayment program designed exclusively to make the cost of education
for teachers more affordable and rewarding than ever.

Contact: Arkansas Student Loan Authority ● www.asla.info

Minority Masters Fellows (MMF)

MMF provides forgivable loans to graduate-level minority students who were recipients of
Minority Teachers Scholars Program loans. Recipients may receive a maximum of $7,500 for one
academic year (or up to $2,500 per summer for a maximum of three summers). Recipients must
teach in an Arkansas public school or public institution of higher education for two years after
completion of their Masters program. This shall be in addition to any teaching obligation the recipient may have to fulfill based on receipt of MTSP funds.

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Contact: Arkansas Department of Higher Education ● 800.547.8839 ● www.adhe.edu

State Teacher Assistance Resource (STAR) Program

The Arkansas State Teacher Assistance Resource (STAR) provides forgivable loans to students pursuing an education degree leading to an initial teacher licensure. Recipients must teach in designated subject and/or geographical critical shortage areas in Arkansas public schools after completion of licensure requirements.

Source: http://www.adhe.edu/divisions/financialaid/Pages/fa_star.aspx

h3. Colorado

Get qualified to teach in this state now.

Colorado Loan Incentive for Teachers (LIFT)

Teachers can get a maximum of $2,000 a year toward loan repayment for up to four years.

Colorado Loan Incentive for Teachers

1801 Broadway, Suite 1300

Denver, CO 80202

Early Childhood Development Professional Loan Repayment Program

Must be employed full-time for at least nine months at a licensed child care facility to qualify. Could earn up to $1,000 in loan repayment per year for two years.

Early Childhood Development Professional Loan Repayment Program

1801 Broadway, Suite 1300

Denver, CO 80202

Continue reading for D-Z

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h3. Delaware

Get qualified to teach in this state now.

Delaware Teacher Corps

Loan forgiveness provision at a rate of one year of teaching in a Delaware public school critical needs subject for one year of loan and loan not to exceed cost of tuition.

Teacher Shortage Areas in 2008-09:

1. Art
2. Bilingual Teachers
3. Business Education
4. English
5. ESOL (English to Speakers of Other Languages)
6. Foreign Language
7. Mathematics (all levels)
8. Music
9. Reading Specialists
10. Science (all levels)
11. School Librarians
12. Special Education
13. Technology Education

Source: http://www.doe.k12.de.us/infosuites/students_family/dhec/how_to_apply/financial_aid/FA_webpages/teacher_corps.shtml

h3. Florida

Get qualified to teach in this state now.

Critical Teacher Shortage Student Loan Forgiveness Program

The Critical Teacher Shortage Student Loan Forgiveness (CTSLF) Program provides financial assistance to eligible Florida teachers who hold a valid Florida Teacher’s Certificate or Florida Department of Health License by assisting them in the repayment of undergraduate and graduate educational loans that led to certification in a statewide critical teacher shortage (CTS) subject area.

Source: http://www.floridastudentfinancialaid.org/SSFAD/factsheets/CTS-LF.htm

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h3. Georgia

Get qualified to teach in this state now.

HOPE Forgivable Loans

If you are a teacher serving in a low-income or subject-matter shortage area, it may be possible for you to cancel or defer your student loans. If you have a loan or multiple loans from the Federal Direct Loan Program or the Federal Family Education Loan Program (FFEL), you may be eligible for deferment if you are teaching full-time in a teacher shortage area.

Source: http://public.doe.k12.ga.us/tss_teacher.aspx?PageReq=TSSTeacherShortage

h3. Illinois

Get qualified to teach in this state now.

The Illinois Teachers and Child Care Providers Loan Repayment Program

Federal Stafford loan borrowers who fulfill a five year agreement in a particular low-income school could get a maximum of $5000 in loan forgiveness.

The Illinois Teachers and Child Care Providers Loan Repayment Program

1755 Lake Cook Road

Deerfield, IL 60015

h3. Iowa

Get qualified to teach in this state now.

Teacher Loan Forgiveness

The State of Iowa offers cancellation benefits to teachers. The maximum annual award is 20% of the teacher’s total federal Stafford loan balance, including principal and interest, not to exceed the average resident tuition rate established for students attending universities governed by the Iowa Board of Regents for the first year following the recipient’s graduation. For 2009 graduates, the maximum award is $6,704.

Source: http://www.iowacollegeaid.gov/commissioncentral/loanforgiveness/teacher.html

Continue reading for J-Z

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h3. Maine

Get qualified to teach in this state now.

Educators for Maine Program

A merit-based forgivable loan program that provides assistance to students pursuing a career in teaching, speech pathology and child care.

Source: http://www.famemaine.com/education/financialAidPrograms.asp#educatorsforMaineProgram

h3. Maryland

Get qualified to teach in this state now.

JANET L. HOFFMAN LOAN ASSISTANCE REPAYMENT PROGRAM (LARP)

Maryland residents who provide public service in Maryland State or local government or nonprofit agencies in Maryland to low income or underserved residents.

Teachers at any level or subject field who teach in schools designated as Federal Title I or Schools Identified for Improvement by the Maryland State Department of Education (MSDE). The official list of schools is available at the bottom of the LARP program description page (see below). Head Start Programs are not eligible.

Teachers with the following areas of certification:

1. technology education (secondary);

2. chemistry (secondary);

3. computer science (secondary);

4. English for Speakers of other Languages-ESOL (elementary & secondary);

5. health occupations (secondary);

6. Latin (secondary);

7. mathematics (secondary);

8. physics (secondary);

9. earth/space science (secondary);

10. physical science (secondary);

11. dance (elementary and secondary);

12. reading specialist (elementary & secondary);

13. speech language pathology (educational service area);

14. Spanish (secondary); and

15. special education: generic - infant to grade 3; grades 1 through 8; grades 6 to adult; hearing impaired; severely & profoundly disabled; visually impaired.

Source: http://www.mhec.state.md.us/financialAid/ProgramDescriptions/prog_larp.asp

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h3. Mississippi

Get qualified to teach in this state now.

Mississippi Teacher Loan Repayment Program (MTLR)

Mississippi funds are available to help teachers pay back their undergraduate loans if they currently hold an Alternate Route Teaching License and currently teach in a Mississippi Teacher Critical Shortage Area or Critical Subject Area.

Recipients may receive up to $3000 annually toward their undergraduate loans for a maximum of four years. Awards are paid directly to the loan servicer. Recipients must apply each year.

Source: http://www.mississippi.edu/riseupms/financialaid-step3-grants-loans.php?article_id=239

h3. Montana

Get qualified to teach in this state now.

Quality Educator Loan Assistance Program

The Quality Educator Loan Assistance Program provides for the direct repayment of educational loans. The total loan repayment assistance may not exceed $3,000 per year for up to four years.

Source: http://www.mgslp.state.mt.us/Content/Managing_Your_Loan/Repayment_Options/Quality_Educator_Loan_Assistance_Program

h3. Nebraska

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Shortage Areas/Low Income Loan Forgiveness

Teachers that teach in approved shortage subject areas or low income schools, including Title 1 schools, may qualify for loan forgiveness in Nebraska.

Source: http://www.nebraskateachereducation.org/loan_scholar.htm

h3. New Mexico

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Teacher Loan-For-Service

The purpose of the Teacher Loan-for-Service is to proactively address New Mexico’s teacher shortage by providing students with the financial resources to complete or enhance their post-secondary teacher preparation education.

The award may not exceed $4,000 per year. Each award may be renewable for up to five years if application is submitted each year.

Source: http://fin.hed.state.nm.us/content.asp?CustComKey=196394&CategoryKey=197309&pn=Page&DomName=fin.hed.state.nm.us

h3. North Dakota

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Teacher Shortage Loan Forgiveness Program

The intent of the Teacher Shortage Loan Forgiveness Program is to reduce a student's loan indebtedness for individuals teaching in North Dakota at grade levels and/or in content areas identified by the Department of Public Instruction as having a teacher shortage.

Funding recipients are eligible to receive up to $1000 per year in continued loan forgiveness for each consecutive year they teach in a teacher shortage area, subject to a maximum of $3,000.

Source: http://www.ndus.nodak.edu/students/financial-aid/details.asp?id=430

Continue reading for O-Z

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h3. Oregon

Get qualified to teach in this state now.

Loan Forgiveness Low-Income Program

The program is designed to allow loan forgiveness based on poverty rate of schools where teachers are employed and have loans under the Federal Perkins Loan (Perkins)/National Direct Student Loan (NDSL), Federal Family Education Loan (FFEL), and William D. Ford Federal Direct Loan (Direct Loan) programs.

Source: http://www.ode.state.or.us/search/page/?id=1668

h3. Tennessee

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Tennessee Math & Science Teacher Loan Forgiveness

The Tennessee Math & Science Teacher Loan Forgiveness Program provides financial assistance to Tennessee public school teachers seeking an advanced degree in a math or a science, or a certification to teach a math or a science. Loan forgiveness requires employment in a Tennessee public school system two (2) years for each year of the loan funding received.

Source: http://www.tn.gov/CollegePays/mon_college/math_science.htm

h3. Texas

Get qualified to teach in this state now.

Student Loan Forgiveness for Teachers

Every year the Texas Education Agency (TEA) produces a list of subject-matter teacher shortage areas and a list of designated low-income schools that are submitted to the US Department of Education (USDE). Teachers with certain types of student loans may qualify for partial loan forgiveness, deferment, or cancellation benefits. Eligibility for these benefits depends on the type of loan the teacher has, the date of his/her first loan, and whether the teacher serves in a designated low-income school or subject-matter teacher shortage area.

Designated low-income schools are those with greater than 30% of enrolled students from low-income families, in districts that are eligible for Title I funds.

Source: http://ritter.tea.state.tx.us/edex/loanforgive.html

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h3. Utah

Get qualified to teach in this state now.

T. H. Bell Teaching Incentive Loan

The Teaching Incentive Loan (TIL) is funded by the Utah State Legislature. TIL recipients are required to pursue an educator preparation program, obtain educator licensing, and then teach in Utah public schools for a period equal to the time they received assistance. The TIL consists of a waiver (of tuition and fees at the Utah public institutions and $995.00 per semester at private institutions) to be used for a period not exceeding 8 semesters. The program is jointly administered by the State Board of Education and the State Board of Regents.

Source: http://www.schools.utah.gov/cert/scholarships/Scholars.htm

h3. Washington

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Future Teachers Loan Repayment Program

The Loan Repayment program encourages outstanding students and paraprofessionals to become teachers, and assists current teachers in obtaining additional endorsements in shortage subjects.

In return for conditional scholarships or loan repayments, participants agree to teach in Washington K-12 public schools, (usually two years of teaching for each year of funding). Funding is available for approximately 100 recipients in 2009-10.

Source: http://www.hecb.wa.gov/paying/waaidprgm/future.asp

Continue reading for Federal Programs

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h3. In Multiple States:

Federal Perkins Loan Cancellation

Teachers may have up to 100 percent of a federal Perkins Loan discharged (cancelled) for
teaching fulltime in a public or nonprofit elementary or secondary school system. Qualifying
persons must serve fulltime as 1) a teacher in a school serving students from low-income
families; 2) as a special-education teacher, including teachers of infants, toddlers, children, or
youth with disabilities; or 3) as a teacher in the fields of mathematics, science, foreign languages, bilingual education, or in any other field of expertise determined by a state education agency to have a shortage of qualified teachers in that state.

Contact: Federal Student Aid Information Center ● 800.433.3243 ● www.studentaid.ed.gov
(The Non-Traditional Licensure program fee does not qualify for Perkins loan cancellation).

Federal Stafford Loan Forgiveness

The program allows eligible borrowers to receive forgiveness for their outstanding student loan
balances on FFEL and Direct Loans. It also allows for forbearance of repayment during the 5-year
teaching period leading up to forgiveness. Fulltime elementary and secondary teachers in
designated low-income schools may receive up to $5,000. Fulltime math, science and special
education teachers in designated low-income schools may receive up to $17,500 in loan
forgiveness.

Contact: Federal Student Aid Information Center ● 800.433.3243 ● www.studentaid.ed.gov
(The Non-Traditional Licensure program fee does not qualify for Stafford loan forgiveness).

10 Ways to Make Extra Summer Income for Educators

Jill Hare | Editor, TheApple.com — Thu, 18 Jun 2009 08:52:00 -0700

Since the job market is tight, teachers may have trouble finding summer work- like waitressing or retail as in previous years. The one constant teachers have is connections with students- especially when they're on summer break. Utilizing existing relationships over the summer has been a great way for teachers to earn extra money and help out parents who trust teachers with their children. Use your set of teaching and leadership skills in various ways to make money. As always, use your school policy handbook to make sure your actions follow proper protocol.

Next page: #1

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1. Start Tutoring

[photo:73790]Parents know that their children need intellectual stimulation over the summer to keep up their skills. Many parents use this time to help their child focus on a particular area of learning. Teachers that tutor can help students learn in a more relaxed environment away from school. Try the library or park for on the spot learning- use different kinds of locations to help teach skills. Read signs on a walk, or shop in a store for math- it's tutoring on the go!

"I've tutored almost every summer since I was a teacher. My school system doesn't allow for tutoring of students while they're in my class, but once the year is over, it's okay to do it. Once a week seems to be good for both the parents and my summer schedule," says Lauren, a 6th grade teacher in Columbus, Ohio.
"It's not a lot of money, but it's nice extra money to save or allocate towards something I'm saving for.

Sample hourly rate: $20 per students

Next page: #2

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2. Teach Music Lessons

[photo:73796]If you are a music teacher or a teacher who plays an instrument, giving music lessons can be a great way to supplement income and share your talents with youth. From singing to playing the piano, children thrive in music instruction. Take the summer months to focus on fun music, like musicals or popular tunes students may know from TV or movies. Music lessons could even include a field trip to see a live music ensemble at the library or local performance venue.

A few years ago, I started a week-long series of summer camps through a local music academy to teach beginner piano. My students loved seeing me over the summer as much as I did them! The different venue and format of piano school seemed to energize both me and my students.

Sample hourly rate: $30 per student

Next page: #3

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3. Teach Swimming Lessons

[photo:73802]If you're a trained lifeguard or expert swimmer, you may qualify to teach private swimming lessons or through a local YMCA program. Check out the requirements necessary and get ready to spend some time getting wet and fit!

"I was a lifeguard in the summer months every year and even during college," Molly, a high school English teacher shared. "It was fun to brush off those skills and earn some extra jobs over the summer. What's better than being at the poll and earning extra money?!"

Sample hourly rate: $15 per student

Next page: #4

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4. Form a Book Club Lessons

[photo:73805]If you have a love of reading, share it with others! For students who may not be into spending time outside, a book club can be a great way to keep them learning and interested in reading. Organize 5-10 students (depending on age) and pick a fun book for them to read each week. During weekly meetings you can discuss the book, have snacks, and even act out a part of the book. Books with movies could be a great way to cap off this series!

Sample hourly rate: $15 per student

Join TheApple Book Club to get ideas from other teachers.

Next page: #5

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5. Give Tennis Lessons

[photo:73799]If you're a sporty person and good at tennis, use your skills as a teacher to help students learn tennis. Get on board with a local fitness gym as a tennis teacher for young students or let your friends know you'd be willing to teach their kids tennis. It's great exercise and a good way to earn some extra money.

Sample hourly rate: $15 per student

"I knew a teacher who played tennis in college," Beth, a middle school science teacher shares. "She was really good and it was neat for the kids to get to see her talent at tennis- so different from her personality as a math teacher!"

Next page: #6

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6. Start a Fit Club

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This kind of club would be good to organize for students who like to keep active. Have a weekly time where students meet and get walking! Stroll through local parks, discover nature, and local attractions. Biking, hiking and walking could all be great options for this group.

Sample hourly rate: $10 per student

"When you're a PE teacher, you get requests like this all the time," Lisa, an elementary PE teacher from Tennessee shares. "I started thinking, 'Why am I saying I'm busy when I could be making some extra money over the summer and helping students stay in shape'?" So I took them up on it a few years back. I started a family and haven't done it for a few years, but I would definitely do it again when my kids are old enough to participate over the summer."

Next page: #7

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7. Organize a Lunch Bunch

[photo:73793]Some parents are looking to keep their kids social this summer. What better way that with a lunch bunch? Not only can students get together to talk, but the lunch bunch could be a picnic outside or a way to experience new cultural foods. Make sure you get a list of allergies before planning meals!

Sample hourly rate: $10 per student (plus cost of food)

My home economics teacher did this back when I was in elementary school. It was a lunch bunch with a culinary twist. We went to her house every Friday for several weeks and she taught us how to make something new for lunch. I remember it fondly and I'm sure my mom does, too!

Next page: #8

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8. Host a Movie Night

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Most parents would be thrilled to get a quick date night out. An easy way to make money would be to organize a movie night for participating families. Pick a theme- like Disney or Harry Potter (depending on the age). Host just one night or a summer series. Pop the popcorn and you're ready to go!

Sample hourly rate: $10 per student

Next page: #9

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9. Work at a Summer Camp

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One of the best ways to make money over the summer is to think about what is in most demand in your area. When kids are out of school, summer camps are crowded. Whether it's a camp at the water park or your local YMCA, check and see if camps are hiring additional staff to lead games or activities.

Teacher Rachel Gold says, "I loved seeing kids at camp develop their own personalities away from their parents, becoming more independent." Is teaching a same a huge money maker? Gold says, "No, but the experience is worth it. Meeting new people and seeing the kid's changing dynamic is great."

Sample weekly rate: $150 a week

Next page: #10

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10. Work Towards a Raise

[photo:73771]

This one won't pay off immediately, but come fall or next year, getting extra degree hours or professional development could pay for itself with a boost in your salary scale. You've got to invest in your degree qualifications to get a return, so do some bargain and quality class shopping online to see what you can learn and how it can help advance your career.

Visit TheApple's Summer Section to get more great ideas.

Do you have an idea to share about how to make extra money? Write it in below!

What to Do if You Can’t Pay Your Bills

Jeffrey Strain | MainStreet.com — Tue, 16 Jun 2009 08:01:00 -0700

Lacking the cash to pay your bills is a bad situation, but avoiding the problem is worse.

If money is scarce and bills are coming due, don’t panic. Gather your statements and a calculator, and go into planning mode. Tackle the crisis as a whole, rather than dealing with issues as they arise, which raises the risk of making poor financial decisions that could affect you for years to come. As you pull yourself together, keep these five crucial steps in mind:

*1. Call the companies you owe*

People faced with a budget shortfall will often try to avoid the companies they owe. They simply stop paying without giving a reason. But you should always call your creditors to alert them of your predicament. They might be willing to negotiate a compromise that will resolve the situation.

*2. Prioritize your bills*

One of the biggest mistakes people make when money is short is to try to be “fair” when paying their bills. If they can only afford to pay one bill, they pay one this month and a different one next month. It might seem like a logical solution, but they could hurt their credit scores and anger the companies they owe.

Some bills are more important than others. Prioritize your creditors and then pay them accordingly. Your mortgage lender should be at the top of the list.

Tips 3 to 5 on the next page >>

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*3. Conserve cash if you can’t pay your mortgage*

When people realize they can’t afford their mortgage, they often put those funds toward other bills. They should save that cash instead.

If you’re falling behind and facing foreclosure, you’ll need enough money to rent a new home. While foreclosures take months to complete, the previous owners usually have to move right away.

*4. Know your rights*

If you can’t make deals with the companies you owe, expect calls from aggressive debt collectors. They’re allowed to call people who owe, but they’re not allowed to threaten debtors with violence, arrest or seizure of property. They’re also prohibited from calling at odd hours or using obscene language. For more on the Fair Debt Collection Practices Act, visit the Federal Trade Commission’s web site.

*5. Don’t ignore the situation*

People caught in a financial crisis face difficult choices, but they need make them. Delaying action will only make the problem worse and leave you with fewer options. Addressing the issue immediately prevents the kind of long-term damage that leads to financial ruin.

The ABCs of Managing Money

Geezeo.com — Tue, 16 Jun 2009 07:59:00 -0700

Budgeting isn't always easy - but it doesn't have to be impossible. And it's worth it. You'll live with less worry now, and endure less headache later on.

Luckily, the Geezeo blog has come up with some basic money management strategies that are as simple as ABC.

Follow their guidelines to squash your debt, start saving, and stop wasting money.

A is for ...

Originally published on Geezeo, a free web-based personal finance application that makes it easy to track your finances, set financial goals, and learn from others. Popular content includes Money 101 and Money Confessions.

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Always Keep Track

You should always keep track of all of your accounts, and running balances of those accounts - specifically, the ones that you use on a daily basis. This will help prevent late payments or being overdrawn on your checking accounts, or going over your limit on your credit accounts.

B is for ...

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Build Credit Carefully

You don’t want to run out and snatch up every credit card offer you receive. Be selective, and don’t go crazy. You want as many as you can handle, and that you can keep in good standing (preferably paid off), but not so many that you lose track or risk running up the bills.

C is for ...

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Cut Down on Non-Essentials

If you are trying to pay off debt, then you should reduce or even eliminate non-essential items. The money you save could could give you extra money to put towards your other debts.

D is for ...

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Destroy Possible Ways to Fall into Debt Again

If you find it hard to resist the urge to max out your credit card again, then you may want to consider cutting them up. If you want to have them “in case of emergency”, be sure to leave them at home (unless you're about to be somewhere you couldn’t easily get to them - like going on a road trip).

E is for ...

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Execute a Plan of Action

A goal, without a plan, is just a dream. You should always map out how you plan to budget better, or how you plan to track your spending, or how you want to pay off your debt. If you don’t, you could get lost quite easily.

F is for ...

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Figure Out All of Your Debt

If you are wanting to budget in order to get control of your debt and pay it off, you need to know how much you owe and to whom you owe it.

G is for ...

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Grow Up!

It’s time to take responsibility for yourself and your actions. If you are old enough to obtain debt, then you are old enough to pay it off. You can’t rely on anyone but yourself.

H is for ...

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Have Back-Up Plans (Emergency Funds)

It’s important to save up enough money to have a cushion. You should determine what your goal is. For some it’s 3-6 months. For others, it's at least a year's worth. You need enough to take care of you in an emergency, as well as if you lost your job. If you do lose your job and don't find one right away, you want to have enough money saved up to pay your bills at least for a time.

I is for ...

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Include Every Debt

Don’t ignore a debt because you don’t think it’s important. When paying off your debts, you should include all of them so you have have a full financial picture of where you are.

J is for ...

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Just Do It!

Sometimes you just have to suck it up and take care of your debt. There are times when you may lack the motivation. However, if that is the case with you, just start doing it, no excuses, and after a while, as the debt starts to decrease, you'll feel great and want to continue.

K is for ...

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Keep Yourself in Check!

When it comes to paying off debt, the initial payments can be exciting! For once you are seeing that balance go down. However, “things come up” (which is why we encourage an emergency fund!). So this could affect what you could pay towards your debt. Don’t let it continue once the “emergency” is over. Keep a check on where your money is going (always tracking your accounts) so that you can spot any mishaps in your plans. Don’t get in the habit of making up your own “emergencies” as well. Just because your friends suddenly decide to go out tonight, and you want to go, don’t sacrifice your goals for one night of fun. That’s not to say you can’t go -- just try to find a way to cut costs.

L is for ...

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Live Life for Your Future

Many people will tell you that you should live for today, because you just don’t know what will happen tomorrow. While that may be partially true, you can say the same about tomorrow. You don’t know if you'll lose your job, or if your child will get sick. So the best thing you could do is “set yourself up for success” so that when these things come up, you are prepared. And keep in mind, there are still plenty of things you can do to enjoy today! You just have to be willing to think outside the box at times.

M is for ...

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Make It Possible

Whatever your goals are, you have the power to make them reality. Take a proactive role in your finances, and you will find ways to make this possible. Don’t earn enough to put towards your debts? Find ways to create more income. Take up a second/part-time job, start a home-based business, or try moving up in your current job. If you simply don’t know what you owe, create a list of the things you do know about. Think there's more? Check your credit report (which can also help you spot possible mistakes in your records).

N is for ...

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Never Go to the Grocery Store Hungry

Here’s a tip that pertains to saving money doing an easy task that everyone has to do at some point: If you are going grocery shopping, try to eat at least a snack before you go. This will help curb the tendency to put whatever looks good in the moment into your cart. When you are hungry, and you are looking at an aisle of food, everything may look good and you won’t be saving money! (Remember to take your list with you to the store as well!)

O is for ...

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Offer to Take on Extra Shifts

We talked earlier about creating more income with work. An easier way to do this would be to simply take on extra shifts at work, if you can. This will allow you to not have to add a new job, but will still create more income for you to put towards your debts. All you have to do is calculate how much extra you would have from the extra shift(s), and then apply that to a debt.

P is for ...

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Pursue New Careers

Whether you dislike your current career, or if you see no room for growth, it may be time to look at a new one. Start talking to others who are in your field of choice.

Q is for ...

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Quit Negative Thinking

Automatic negative thoughts (or ANTs) can be damaging to your success. You should try to keep yourself from automatically assuming that you aren’t going to be able to accomplish something, or that you would, no matter how hard you tried, fail. You have to kill those ANTs as soon as they begin to come in. At first this may not be easy, but if you are keeping an eye out for them, and instantly turning around to think something positive, then you will be able keep those negative thoughts at bay until they are no more.

R is for ...

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Reduce Costs of Essentials

If you are not able to take on extra shifts or take on a second job, then maybe it’s time to consider if you really NEED to have DVR or if you can downgrade on your internet. If you have a cell phone, do you really need to have a home phone too? There are many areas you can consider when it comes to cutting costs. Many families have chosen to eat at home more. This also contributes to more quality family time as well.

S is for ...

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Stay Focused on Long-Term Goals

While short term goals are good - it’s good to think about your long term goals. You will want the short term to add up to the long term. If your end goal is to own your own home, then you will want to get rid of credit card debt and the like, as well as start saving for your down payment. These short term goals are going to allow you to attain your long term goal of finally owning your own place.

T is for ...

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Trouble Won't Find You, You Find Trouble

Many people blame credit card companies for the problems they have with their debt. However, you are the one who chose to open the card. No one forced you to do it. No one forced you to use the card either. So it is no one else's fault. Which is why you need to take control. You need to take responsibility. Once you do those things, you will be on the path of financial independence. Stay away from it if you think you may have a problem later.

U is for ...

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Understand Your Biggest Weaknesses

If you know that you are going to have a hard time resisting the urge to buy that new pair of pumps, then maybe it is best to avoid that store altogether. If you are trying to decide on a big purchase, for instance, a car, and you know you can’t afford to drive anything over $20,000, don’t tempt yourself by test driving something above that price range. When it comes to purchases, big or small, do not test your emotions, because more than likely, you will begin to rationalize while this is better than that, or why you should get something now verses saving up for it later.

V is for ...

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Variety Is the Spice of Life

When grocery shopping, you may have made your list, and you may have been sticking to it very well. But let’s say that you were going to get roma tomatoes, but the vine tomatoes are on sale. Or how about lettuce for salads but the pre-mixed salad bags are on sale (you could save money AND time on this one). You won’t know if you like something unless you try it, so be open to new experiences. You never know, a recipe might be better with the replacement.

W is for ...

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Wait Out Your Purchases

If you want something, and it is a big purchase, you may want to wait out the purchase to see if you still want it in 2-3 months. Even 2-3 weeks could allow you enough time to determine if it’s really necessary. If it’s a smaller purchase, you may still want to wait it out as it could go on sale or get even drop in price.

X is for ...

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X-amine Your Goals

Sometimes you will need to revisit your goals, and adjust them according to your current circumstances. If you realize that a current goal is not attainable with your immediate circumstances, put it on the back burner, and work on the next one. Then revisit it in the future to see if you can do it. As you complete goals, create new ones. Always keep an eye on where things are heading, and you will be able to better stay on track. Also having your goals in a place that is readily seen on a daily basis will help keep your goals fresh in your mind, and hopefully deter you from anything that may get you off track.

Y is for ...

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You Should Always Have Faith in Yourself

You can do anything as long as you put your mind to it. You should always remember that if you make a decision, work hard at achieving it, you will attain it (even if only eventually). You have to have faith in yourself, and keep telling yourself positive things (avoiding those ANTs).

Z is for ...

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Zip Up Your Wallet

Don’t spend it just because it’s there - Finally, when it comes to your spending, you should keep track of where you money has gone, and where it needs to go. Just because there is money in your bank account today does not mean you should buy something. You may have upcoming bills you need to pay for first. Or you may even have bills that have not cleared your bank yet. This is why keeping a budget, and keeping track of your accounts is vital. Even better is to keep a check register so that you know what bills you have paid even if they have not cleared your bank.

Get more finance tips for teachers here.

Shred It Up: Which Financial Docs Can Go Now

Staff Writers | MainStreet.com — Tue, 16 Jun 2009 07:59:00 -0700

Knowing how long to keep an important financial document is the key to maintaining your personal security as well as managing clutter. Some documents can be shredded after short periods of time, while others should be kept indefinitely. Here’s a handy guide to help you figure out what to keep and what to shred, beginning with the short-lived documents:

Keep for 45 Days

• Credit card receipts. Once the bill comes, you can shred these unless they will be deducted at the end of the tax year.

Keep for One Year

• Non-permanent bank records such as retail, utility and personal expenses that are not tax-deductible.

• Brokerage statements from active securities to show capital gains and/or losses at tax time.

• Utility, credit card and other bills can be shredded after one year for anything except large purchases.

Keep for Seven Years

• Tax documents, including tax returns, canceled checks, receipts and records for tax-deductible items like alimony, charitable contributions, mortgage and student loan interest, retirement plan contributions, etc. NOTE: The IRS has three years from the date you filed to audit your returns if they suspect errors. You also have three years to amend your tax returns if you find an error on your part or receive additional documentation. The IRS also has six years to challenge your return if you underreport your gross income by more than 25 percent, so be sure to keep all W-2s, 1099s and other income reporting paperwork.

• Credit card statements

• Housing purchase documents and related paperwork

Continue reading on the next page ->

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Keep Permanently

• IRA contributions. These are vital because you may need to prove the amount of your contributions when it comes time to withdraw funds at retirement age.

• Retirement/savings plan statements. To save space, you can keep the yearly statements for each account and shred the quarterlies at the end of each year after you’ve verified the annual reports.

• Bank records for important expenses, such as those related to taxes, home improvements, business expenses, and mortgage payments.

Shred Now

• Closed retirement, savings, checking or other financial accounts with a zero balance.

• Receipts from non tax-deductible items like groceries, most retail purchases, etc.

• Tax documents more than seven years old.

Conditional Documents (Times Vary)

• Brokerage statements can be shredded when the corresponding securities are sold or accounts are closed.

• Bills for large purchases such as jewelry, appliances, antiques, cars, furniture, computers, collectibles and other investment pieces should be kept until the item is sold or no longer in your possession.

• Medical records should be kept as long as necessary, given your current health circumstances. You probably don’t need to keep a report of your chicken pox doctor visit from third grade, but an abbreviated lifelong record of immunizations and illnesses can prove to be quite useful for many doctors. You may consider scanning these documents and storing them digitally to save space.

4 Things That May Trigger Your Spending

Hannah Waters | Geezeo.com — Wed, 03 Jun 2009 06:56:00 -0700

Overspending is easy to do. Everyone falls for it every now and again because sometimes you just feel the need to spend. However, there may be things that trigger our overspending even when we know that we are on a budget and cannot really afford to spend money.

1) Stress – Work, family, friends, sickness, money…all these things (and many more) can lead to stress in someone’s life. Stress can definitely trigger your spending because it allows you to take your mind off
of whatever may be bothering you for that little amount of time. Even if it is just going out for dinner or a drink after work…although you may not be able to afford it, if you think it will take away your stress and allow you to relax a little bit you are willing to spend the money.

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2) Peer Pressure – As you get older you think that you outgrow peer pressure and that it really not longer effects you. However, this is really not the case. In the work environment or even just with friends, peer pressure is very prominent as you get older. When shopping with friends, if they are buying things or if they tell you that something looks good on you and that you should buy it sometimes you fall into the trap and end up purchasing something just because someone said you should.

Next page: Final two culprits >>

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3) Emotions – If something is happening in your life that has got you down or on the flip side makes you want to celebrate, this often triggers a side of you that makes you want to spend money. Similar to stress, spending allows you to forget bad things that are happening. However, if you get a promotion or something, you spend money to celebrate. The same goes for if you have a date or vacation…you are excited so spend more money.

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4) Credit Cards – Credit cards definitely give us an easy out. Even when people know that they do not have the money to spend, they know that a credit card can still allow us to spend. This is one of the worst influences because it will get you in serious amounts of debt that you have to account for later on. People get sucked into the credit card trap without really thinking about what they are doing and before they know it they have spent way more than they thought.

All of these things can trigger over spending that you know you should not be doing if it does not fit within your budget. Try to find things that will substitute spending money to help celebrate or make yourself feel better. In the long run, giving into these things that trigger your spending will only make you struggle with your budget or lead you into a great deal of debt down the road.

7 Common Mistakes of First-Time Homebuyers

Katie McCaskey | Geezeo.com — Wed, 03 Jun 2009 06:55:00 -0700

Buying a home for the first time can be an invigorating yet scary experience. Here are some pitfalls to avoid when you’re buying your first home:

1. Buying Before You’re Ready

Although you may hear people say you’re “throwing your money away on rent,” it isn’t always wise to buy a home. If you make a good salary and have an expanding family, the desire to own a home is natural, but you have to make sure that buying makes good financial sense. Start by evaluating your debt and income. You should cap your spending on a home at no more than three times your household adjusted gross income. Also, you should reduce your income by your debt. This is how much house you can truly afford. Most financial experts also recommend that you have eight to 12 months in liquid assets in order to be totally prepared for homeownership.

Next Page: Not Asking Questions>>

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2. Not Asking Questions

For first-timers, being afraid to come off as too eager or annoying with questions can force you to miss important information. After all, smart people ask questions!

Don’t be afraid to ask for definitions or explanations of everything, even if you think it should be something you know. You never know how much trouble you can get into by not understanding basic home buying terminology.

Next Page: Underestimating Additional Costs>>

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3. Underestimating Additional Costs

Just because you can afford your mortgage payment each month doesn’t mean that you can afford a home. You must also take into consideration closing costs, property taxes, home repairs and unexpected emergencies. In addition to these expenses, you should consider the costs of upkeep, including utilities, lawn care, security systems, pest control and annual maintenance.

Next Page: Overestimating What You Can Afford>>

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4. Overestimating How Much You Can Afford

This goes back to being realistic about your income. Just because you’ve been approved for a loan amount doesn’t mean you can afford it.

Are you going to have enough income to pay it back? Your house payment is just one piece of a bigger financial puzzle. What other major expenses do you have on the horizon? Again, home repairs, HOA fees and property taxes are not small expenses & #0151; make sure you've done the necessary calculations, and are prepared to adjust your lifestyle accordingly.

Next Page: Forgetting About Resale>>

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5. Forgetting About Resale

This is a dangerous pitfall many people are contending with now that the market bubble has burst. They purchased homes that were “unique” or “needed work” but never got around to doing it.

Now, they’re stuck with homes that are worth even less than they paid for them and still are in need of repairs. Which brings us to the next pitfall…

Next Page: Thinking Home Repair Is Simple>>

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6. Thinking Home Repair Is Simple

This is a major no-no. Never assume a repair on a “fixer-upper” will be simple or cheap.

Even if you are doing the labor yourself, the cost of permits and materials alone can set you back an enormous amount of time and money, so be prepared for this.

And be careful. If you embark on a DIY project, but don't really know what you're doing, you could up spending a lot more time, money and effort to get the job done right later on.

Next Page: Forgetting About the Neighborhood>>

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7. Forgetting About the Neighborhood

Be sure to visit any potential home at night as well as during the day. This part is key - you may find it an entirely different world after dark.

Remember, if you buy a home, you are buying the neighborhood also. Keep an eye out for the area’s progress. Is it on the upswing or in the middle of a downturn?

Even if it is on the upturn — an indication of a good investment — will you actually feel comfortable living there for the next 5-10 years?

Make Your Taxes Less Taxing: Tips and Tricks

Wed, 01 Apr 2009 14:17:00 -0700

Taxes are overwhelming and complicated. There is form after form and it gets tough to keep them all straight. The most painful part, however, is seeing the toll it takes on you wallet. TurboTax, Military.com and TheApple have brought you expert financial advice to make your taxes as painless as possible and hopefully save a lot of money in the process.

Page 2: Tax Preparation Checklist

Page 3: 5 Ways to Make Your Taxes Less Taxing

Page 3: The 11 Most Overlooked Tax Deductions

Page 4: Top Ten Odd Ball Tax Deductions

Get all the tips and tricks....

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Page 1: Table of Contents

Page 2: Tax Preparation Checklist

Page 3: 5 Ways to Make Your Taxes Less Taxing

Page 4: The 11 Most Overlooked Tax Deductions

Page 5: Top Ten Odd Ball Tax Deductions

Tax Preparation Checklist

Go through the following checklist before you prepare your income tax return. Not every category will apply to you, so just pick those that do, and make sure you have that information available. When you're ready to prepare your income tax return using TurboTax software, you'll be surprised at how much time you'll save by organizing your information beforehand.

Before you start tax preparation

Print this checklist out. Check things off as you collect them, and enter information such as Social Security numbers and cash amounts.

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If you maintain your financial data in a personal finance software program such as Quicken®, print a report of your financial transactions for 2008. This is an invaluable tax preparation resource as you prepare your income tax return, and helps you clearly see where your money goes each year. Having this information in a report is much easier than going through your checks for the entire year.

As you review the report, highlight information you will need for your tax return or make notes to remind yourself of something later. If you need more information on a certain item, the report makes it easier to find the item on the computer when you need the detail. For example, if you know you paid check number 1077 to the IRS but don't know if it was for last year's balance due, an estimated payment for this year, or an extension payment, you can do a search for check number 1077 and get more detail.
Now you're ready to start gathering information. This income tax preparation checklist is divided into relevant categories to help you organize your tax information. As you receive or locate an item, check it off of the list.

Tax Preparation Checklist.doc

Updated for tax year 2008. Content provided by Kiplinger, courtesy of TurboTax, a registered trademark of Intuit Inc.

Next Page: 5 Ways to Make Your Taxes Less Taxing

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5 Ways to Make Your Taxes Less Taxing

Let’s face it: Doing your taxes is about as exciting as mowing your lawn. But, we all have to do it. And Uncle Sam doesn’t make it easy. The U.S. tax code literally fills thousands of pages. Thankfully, you don’t need to read them all to stay on top of your taxes. Here are five things that can make doing your taxes “less taxing” as Tax Day – April 15 – approaches.

1) First, understand what kind of “Taxes” you’re paying to begin with.

2) Now let’s talk about what you can do to reduce those taxes.

They’re not automatic.

Deductions do not reduce your tax bill dollar by dollar.

3) An even better way to cut back on your tax bill is through tax credits.

4) You don’t need to go it alone.

www.aicpa.org

5) What papers do you need to save?

Next Page: The 11 Most Overlooked Tax Deductions

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The 11 Most Overlooked Tax Deductions

TurboTax helps you find tax deductions you may have overlooked. Don’t overpay taxes by overlooking tax deductions. See the most common errors taxpayers make on their tax returns. …it’s all too easy to miss a trick and pay too much…

Every year, the IRS dutifully reports the most common blunders taxpayers make on their returns. And every year, at or near the top of the list, is forgetting to enter a Social Security number or making a mistake when entering the nine digits that identify us to IRS computers.

Before you bemoan such stupidity, ask yourself a simple question: Is that the most common error? Or just the most easily noticed goof?

Who knows how many people forgot—or never knew about—a deduction that could save them money? That’s not the kind of thing over which government bean counters lose a lot of sleep.

No doubt about it: The opportunity for mistakes is almost unlimited. The most recent numbers show that about 46 million of us itemized deductions on our 1040s—claiming nearly 1 trillion dollars’ worth of deductions. That’s right: $1,000,000,000,000! Another 85 million taxpayers claimed more than half a trillion dollars’ worth of standard deductions. Some of those who took the easy way out probably shortchanged themselves. (If you turned 65 in 2007, remember that you deserve a bigger standard deduction than younger folks.)

Yes, friends, tax time is a dangerous time. It’s all too easy to miss a trick and pay too much. Years ago, the head of the IRS told Kiplinger’s Personal Finance magazine that he figured millions of taxpayers overpaid their taxes every year by overlooking just one of the money-savers listed below. Without further ado, here are our 11 most overlooked tax deductions. Claim them if you deserve them, and cut your tax bill to the bone.

1. State sales taxes.

This write-off makes sense primarily for those who live in states that do not impose an income tax. You must choose between deducting state income taxes or state sales taxes and, for most citizens of income-tax states, the income tax deduction usually is a better deal. IRS has tables for residents of states with sales taxes showing how much they can deduct. But the tables aren’t the last word. If you purchased a vehicle, boat or airplane, you get to add the state sales tax you paid to the amount shown in IRS tables for your state, to the extent the sales tax rate you paid doesn’t exceed the state’s general sales tax rate. The same goes for home building materials you purchased. These items are easy to overlook. The IRS even has a calculator on its Web site to help you figure out the deduction, which varies by your state and income level.

2. Reinvested dividends.

This isn’t really a deduction, but it is a subtraction that can save you money; this is the break former IRS Commissioner Fred Goldberg told Kiplinger’s that lots of taxpayers miss. If, like most investors, you have mutual fund dividends automatically invested in extra shares, remember that each reinvestment increases your “tax basis” in the fund. That, in turn, reduces the taxable capital gain (or increases the tax-saving loss) when you redeem shares. Forgetting to include the reinvested dividends in your basis—which you subtract from the proceeds of sale to pinpoint your gain—means overpaying your tax. TurboTax Premier and Home & Business tax preparation solutions include a very cool tool—Cost Basis Lookup—that will figure your basis for you and make sure you get credit for every dime of reinvested dividends.

3. Out-of-pocket charitable contributions.

It’s hard to overlook the big charitable gifts you made during the year, by check or payroll deduction. But the little things add up, too, and you can write off out-of-pocket costs you incur while doing good works. Ingredients for casseroles you regularly prepare for a nonprofit organization’s soup kitchen, for example, or the cost of stamps you buy for your school’s fundraiser count as a charitable contribution. If you drove your car for charity in 2007, remember to deduct 14 cents per mile.

4. Student loan interest paid by Mom and Dad.

Until recently, if parents paid back a student loan incurred by their children, no one got a tax break. To get a deduction, the law held that you had to be both liable for the debt and actually pay it yourself. But now there’s an exception. If Mom and Dad pay back the loan, the IRS treats it as though they gave the money to their child, who then paid the debt. So, a child who’s not claimed as a dependent can qualify to deduct up to $2,500 of student loan interest paid by Mom and Dad.

5. Moving expense to take first job.

Here’s an interesting dichotomy: Job-hunting expenses incurred while looking for your first job are not deductible, but moving expenses to get to that first job are. And you get this write-off even if you don’t itemize. If you moved more than 50 miles, you can deduct the cost of getting yourself and your household goods to the new area, including 20 cents per mile (plus parking fees and tolls) for driving your own car.

6. Military reservists’ travel expenses.

If you are a member of the National Guard or military reserve, you may deserve a deduction for travel expenses to drills or meetings. To qualify, you must travel more than 100 miles and be away from home overnight. If you qualify, you can deduct the cost of lodging and half the cost of your meals, plus 48.5 cents per mile (and any parking or toll fees) for driving your own car. You get this deduction whether or not you itemize.

7. Child care credit.

A credit is so much better than a deduction—it reduces your tax bill dollar for dollar. So missing one is even more painful than missing a deduction that simply reduces the amount of income that’s subject to tax. But it’s easy to overlook the child care credit if you pay your child care bills thorough a reimbursement account at work. Until a few years ago, the child care credit applied to no more than $4,800 of qualifying expenses. The law allows you to run up to $5,000 of such expenses through a tax-favored reimbursement account at work. Now, however, up to $6,000 can qualify for the credit, but the old $5,000 limit still applies to reimbursement accounts. So, if you run the maximum $5,000 through a plan at work but spend more for work-related child care, you can claim the credit on up to an extra $1,000. That would cut your tax bill by at least $200.

8. Estate tax on income in respect of a decedent.

This sounds complicated, but it can save you a lot of money if you inherited an IRA from someone whose estate was big enough to be subject to the federal estate tax. Basically, you get an income tax deduction for the amount of estate tax paid on the IRA balance. Let’s say you inherited a $100,000 IRA and the fact that the $100,000 was included in your benefactor’s estate added $45,000 to the estate tax bill. As you withdraw the money from the IRA and pay tax on it, you also get to deduct a proportional amount of the estate tax paid. If you withdraw $50,000 in one year, for example, you get to claim a $22,500 itemized deduction on Schedule A.

9. State tax you paid last spring.

Did you owe tax when you filed your 2006 state tax return in the spring of 2007? Then remember to include that amount with your state tax deduction on your 2007 return, along with state income taxes withheld from your paychecks or paid via quarterly estimated payments.

10. Refinancing points.

When you buy a house, you get to deduct points paid to obtain your mortgage in one fell swoop. When you refinance a mortgage, though, you have to deduct the points over the life of the loan. That means 1/30th a year if it’s a 30-year mortgage—that’s $33 a year for each $1,000 of points you paid. Not much, maybe, but don’t throw it away. And, in the year you pay off the loan—because you sell the house or refinance again—you may get to deduct all the as-yet-undeducted points. You do unless you refinance with the same lender. In that case, you add points on the latest deal to the leftovers from the previous refinancing and deduct the expense ratably over the life of the new loan.

11. Jury pay paid to employer.

Some employers continue to pay employees’ full salary while they are doing their civic duty, but ask that they turn over their jury fees to the corporate treasury. The only problem is that the IRS demands that you report those fees as taxable income. You’ve always had a right to deduct the amount, so you weren’t taxed on money that simply passed through your hands.

Next Page: Top Ten Odd Ball Tax Deductions

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Top Ten Odd Ball Tax Deductions

Admit it. As you've worked on your return, trying to come up with extra deductions to pump up your refund, you've taken a few flights of fancy. "Can I claim a deduction for all those blood donations at the Red Cross?" Nope.

"How about a charitable contribution for all the time I donate to the church?" Nope, again. "The wedding gift for the boss's daughter as an employee business expense?" Come on! On the other hand, over the years your fellow taxpayers have beaten the IRS in court on payments for many crazy things that most of us wouldn't even dream of claiming.

We've uncovered what we think are the weirdest deductions allowed, ranging from pet food to free beer.

1. Pet food

A couple who owned a junkyard was allowed to write off the cost of cat food they set out to attract wild cats. The feral felines did more than just eat; they also took care of snakes and rats on the property, making the place safer for customers. When the case reached the Tax Court, IRS lawyers conceded that the cost was deductible.

2. Moving the family pet

If you are changing jobs and meet a couple of tests, you can deduct your moving expenses — including the cost of moving your dog, cat or other pet from your old residence to your new home. Your pet — be it a Pekingese or a python — is treated the same as your other personal effects.

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3. A trip to Bermuda

This island is more than just a scenic place to visit: It's a great place to schedule a tax write-off. Business conventions held in Bermuda are deductible without having to show that there was a special reason for the meeting to be held there. That's a sweet perk.

Other countries in the Caribbean region qualify, too, including Barbados, Costa Rica, Dominica, the Dominican Republic, Grenada, Guyana, Honduras, Jamaica, Saint Lucia, and Trinidad and Tobago. Meetings held in Canada, Mexico and all U.S. possessions also receive this favorable tax treatment. Attend a convention in Paris, Rome or Beijing, though, and there's no deduction unless you can show it made as much sense to travel abroad as to head to Pittsburgh.

4. Body oil

A pro bodybuilder used body oil to make his muscles glisten in the lights during his competitions. The Tax Court ruled that he could deduct the cost of the oil as a business expense. Lest it be seen as a softie, though, the Court nixed deductions for buffalo meat and special vitamin supplements to enhance strength and muscle development.

5. A private airplane

Rather than drive five to seven hours to check on their rental condo or be tied to the only daily commercial flight available, a couple bought their own plane. The Tax Court allowed them to deduct their condo-related trips on the aircraft, including the cost of fuel and depreciation for the portion of time used for business-related purposes, even though these costs increased their overall rental loss.

6. Babysitting fees

Fees paid to a sitter to enable a mother to get out of the house and do volunteer work for a charity are deductible as charitable contributions, even though the money didn't go directly to the charity, according to the Tax Court. The Court expressly rejected a contrary IRS revenue ruling.

7. Breast augmentation

In an effort to get more tips, a stripper with the stage name "Chesty Love" decided to get breast implants to make her a size 56FF. A female Tax Court judge allowed Chesty to write off the cost of her operation, equating her new assets to a stage prop. Alas, the operation proved to be a problem for Chesty. She later tripped and ruptured one of her implants.

8. Landscaping

Sole proprietors who regularly meet clients in a home office can deduct part of the costs of landscaping the property. The deductible portion is based on the percentage of the home that is used for business, according to the Tax Court. The Court also allowed a deduction for part of the costs of lawn care and driveway repairs.

9. Free beer

In a novel promotion, a gas station owner gave his customers free beer in lieu of trading stamps. Proving that sometimes beer and gasoline do mix, the Tax Court allowed the write-off as a business expense.

10. Swimming pool

A taxpayer with emphysema put in a pool after his doctor told him to develop an exercise regimen. He swam in it twice a day and improved his breathing capacity. Turns out he swam in the pool more than his family did.

The Tax Court allowed him to deduct the cost of the pool (to the extent the cost exceeded its added value to the property) as a medical expense because its primary purpose was for medical care. Also, the cost of heating the pool, pool chemicals and a proportionate part of insuring the pool area were treated as medical expenses.

Bonus Oddball Deduction: Girlfriend.

The owner of several rental properties hired his live-in girlfriend to manage them. Her duties included finding furniture, overseeing repairs and running his home. The Tax Court let him deduct $2,500 of the $9,000 he paid her. The disallowed portion was for nondeductible personal services.

Updated for tax year 2008. Content provided by Kiplinger, courtesy of TurboTax, a registered trademark of Intuit Inc.

5 Ways to Understand Your Credit Card's Fine Print

Jennifer Openshaw | WeSeed — Fri, 27 Mar 2009 12:06:00 -0700

If you're like a lot of folks, you may have just received a "Dear Valued Customer" letter in the mail from your credit card company. No, you aren't being fired, but it might feel like it.

If you have an affiliate card issued through one of the big banks, it starts like this: "This challenging business climate has led Citibank, the issuer of [XYZ] Gold MasterCard...to notify us...they are making changes to the terms of many Citibank (C) credit card offerings....including the [XYZ] MasterCard product."

Uh-oh — here it comes.

The enclosed material, one of those multipage fine-print deals, starts off with "The Changes." It tells you that the APR, minimum-finance charges, transaction fees for foreign purchases, and "other fees" have changed, and that "supplemental pricing information" appears in "...your new card agreement [which] follows this notice."

Changed from what to what? Unless you have the last version of this document handy, you probably won't know what or how much. Like too many things in personal finance, you don't know what you don't know.

You'll find a lot of these changes these days. First, because of the banking crisis, cash-strapped banks are scrounging for cash wherever they can. Second, new federal legislation that takes effect in 2010 bans universal default, double-cycle billing, and a host of other evils. That's the good news. The bad: This is driving banks to get ahead of the potential $12 billion in lost revenue.

So here's what to do.

*Call an agent*

Pick up the phone immediately and find a live agent willing to explain the changes.

4 More Tips on the Next Page >>

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*Get a comparison*

Have the agent clarify what changed, not just what your card's terms are today or after the change. If your effective APR went from "prime +14.08%" to "prime + 17.99%," have them explain that and also what the resulting rate actually is. For any fees changed, ask them what the new and old fees are. Have them do an example if necessary to illustrate total cost.

*Be persistent*

When they're done, ask if there's anything else you should know. I found out that the "penalty period" for the higher default APR if you miss a payment had increased from 6 months to 12 months. Hard to find in the fine print, and it didn't come with the first explanation.

*Pay your balances in full and on time*

The adverse changes only applied to balances carried and/or a late payment; if you pay in full and on time you won't be affected. You might consider setting up auto-pay to avoid late payments.

*Ask for the good news*

These changes all sound like a takeaway; less benefit, more cost. However, the issuer also offered attractive balance transfers, 5 months for 1.99 percent with a 3 percent transfer fee; 3.99 percent for 10 months. Some issuers may offer other benefits anticipating negative customer reactions from changes in terms.

Protecting what you have and knowing about change are important in managing your credit and your finances in general. And incidentally, the banks and card issuers that do these changes well — raising cash without angering customers — stand to come out ahead.

Jennifer Openshaw, author of The Millionaire Zone, is co-founder and president of WeSeed, whose mission is to enable people to discover the stock market in their everyday lives through their passions, their jobs and the brands they know and love. Her empowering advice, which helps everyday Americans do more with what they have, hasbeen seen on Oprah, Dr. Phil, The Today Show, CNN, CNBC, and Nightline. You can find her on Twitter @jopenshaw or on Facebook.

How to Apply for Unemployment Benefits

Jacky Hayward | Monster Evolutions — Fri, 27 Mar 2009 12:05:00 -0700

Once you have been laid off, one of the first things you are likely to think about is how you are going to replace your income. Unemployment Insurance (UI) was established by the government to provide unemployment benefits to workers when become unemployed due to factors outside their control to financially assist them while they are looking for employment. UI is a joint federal-state program with money coming from the federal and state governments but the administration coming from the state, so the rules determining eligibility vary as well as the benefits received depending on the state in which you live. This article is thus intended to serve as a general guide to unemployment insurance.

What to Expect when Applying for Unemployment Insurance

To apply for unemployment insurance, you must first contact your state’s unemployment agency. Career One Step has a map of all the state unemployment agencies, which will be a good place to find out more about your state’s agency. With the increase in layoffs, there has also been an increased number of individuals requesting unemployment insurance. Many unemployment offices are holding longer hours but there is still a backlog. In this manner, if your state unemployment agency allows you to, applying online will likely expedite the application process.

Once you have applied for unemployment insurance, most states will verify your unemployment in some way; this may mean a short phone interview, an in person interview with an unemployment officer, or further verification via USPS mail. After your unemployment department has received your claim and all necessary verification, they will calculate your unemployment benefits on your past salary, usually using your last year and a half of salaried time. Your UI benefits will be proportional to your past salary, but will often cap out at a certain point, depending, again, on your state. In addition, it is likely it will take a few weeks for you to receive your first unemployment check after your local agency has received all the necessary materials.

What to Keep in Mind Once you Have Applied

Once you start receiving checks, each week or every other week you will have to complete questionnaire to prove that you are in fact searching for a job; after all, unemployment insurance is intended to assist you in your job search

In addition, unemployment benefits are taxable. You can elect to have a specified amount withheld each check, but you will be responsible to pay taxes on the income earned come the next tax year, so plan appropriately!

How Obama’s Stimulus Plan will help Unemployment Insurance

Obama’s stimulus plan is still being debated in the Senate, but, in its present state, the stimulus package aims to provide $62 -$76 billion to state fiscal relief in order to compensate for decreasing state budgets. State governments pay in part for unemployment benefits and state run health care programs. With the downturn in the economy, state and local governments will need to increase taxes in order to continue these public services without aid of the federal government; the goal of the stimulus is to keep taxes low while allowing state governments to continue to provide unemployment benefits and other state run programs.

In addition, the current stimulus plan provides $36 billion to states to budget through December 2009. This allotted money will increase unemployment benefits by $25 per week. Further, the stimulus proposal includes suspending taxes on the first $2,400 of these benefits.

How to Avoid an Audit of Your Taxes

By John Rossheim, Monster Senior Contributing Writer — Tue, 24 Mar 2009 11:46:00 -0700

Taxes are high enough; you don’t want to also pay penalties and interest because an audit reveals you’ve broken the rules. And Internal Revenue Service audits aren’t a vanishing anomaly; they’re on the upswing.

The IRS “has gotten almost nasty” in its pursuit of tax payments that could help reduce the federal deficit, says Sanford Botkin, a lawyer and CPA. Audit rates increased in 2007, both for overall individual rates and for higher-income taxpayers, reaching a 10-year high, according to IRS statistics.

Now that you’ve been forewarned, forearm yourself with these tips for reducing the chances that the IRS will send you an invitation you can’t refuse.

Choose Your Tax Advisors and Preparer Carefully

A highly qualified tax preparer will help you nip many common audit triggers in the bud. “You want an honest but aggressive accountant,” says Botkin, a former legal specialist with the IRS. That means interviewing preparers to determine if they will pursue all legitimate tax breaks without claiming questionable deductions that could raise red flags.

Watch Your Itemized Deductions

A tax return reporting a moderate $60,000 income while claiming a very large $15,000 mortgage interest deduction smells fishy. So the IRS uses computer algorithms to detect the smell of a tax return on which the key amounts relate to each other in statistically unlikely ways. That’s why it’s wise to include worksheets, disclosures, documentation or other explanations of large deductions and big changes from one tax year to the next with your return.

Small deductions that add up can also draw unwanted attention. “Look out for excessive miscellaneous itemized deductions like unreimbursed business expenses,” says Sandra Abalos, managing partner of accounting firm Abalos and Associates PC.

Learn About Tighter Rules for Charitable Gifts, Whether Cash or In-Kind

Keep giving, but be sure the recipients give you something back: Adequate documentation of the donation and its tax-deductible status. “Charitable contribution paper requirements are more intense this year,” says Kenn Tacchino, an adjunct professor of tax and financial planning at Widener University.

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Bob Greisman, a partner with accounting firm BDO Seidman LLC in Chicago concurs. “Be careful not to take large charitable contribution deductions if you can’t back them up,” he says.

Keep a Lid on Your Tirades

If you really want to avoid an audit, don’t attach a statement to your return saying you’ve declared your half-acre home lot a sovereign nation not subject to US taxation.

Beware of Garbage In, Garbage Out

Neither a human preparer nor tax-preparation software like TurboTax or TaxCut can help you avoid an audit if you supply them with incorrect data. Because a highly qualified professional may be more likely to sense that your numbers are off, “the IRS is looking harder at returns prepared with consumer software,” Botkin says.

Play the Calendar

Some tax experts claim that you can cut your chances of an audit by strategically choosing when you file. The idea is to file on or within a few days before the tax deadline, usually April 15. From January to March, returns arrive at the IRS much more slowly, so the chance that any given return will be examined rises. But be sure your return is postmarked on time; late returns trigger audits.

Remember that Neatness, Accuracy and Completeness Count

Carelessness catches the auditors’ attention. “The number 1 audit trigger is that you didn’t include all forms or sign them,” Tacchino says.

Don’t let handwriting or an arithmetic error land you in the auditor’s hot seat. Hard-to-read returns will peeve the data-entry specialist, and math mistakes will be caught by the IRS computer and may raise a red flag.

Finally, accept that while you can significantly reduce your chances of audit, you might still receive that unwanted envelope requesting more information or summoning you to a sit-down with the feds.

A small fraction of returns - probably less than 1 percent - are randomly chosen for audit. “We’re seeing more of these now,” Abalos says. “In Phoenix, the IRS has trained a whole bunch of kids on audits, so we’re getting pure random training audits.”

Bailout Bill Extends Tax Breaks for Individuals

Military.com | Kyle Stone — Wed, 04 Feb 2009 10:11:00 -0800

In 2008, legislation was passed to help rescue US markets and the economy. But did you know that these bailout bills also included a bundle of income tax breaks?

The biggest ones are known as "extenders" - popular tax breaks that might seem permanent to most taxpayers, but actually must be renewed every year or two.

Stuffed inside the *Emergency Economic Stabilization Act* are more than 100 tax provisions worth $150 billion in tax benefits. They include:

• Another “patch” to protect middle-class taxpayers from having to pay $61.8 billion in alternative minimum taxes, or AMT, a tax intended for the wealthy.

• Extensions of some popular tax breaks for 2008 and beyond that were scheduled to expire this year, including deductions for classroom teachers and for higher-education tuition.

• Major tax breaks for victims of the 2008 Midwestern storms, floods and tornadoes.

AMT Patch Completed in Time for 2008 Filing Season

Once again Congress has applied a one-year patch on the AMT. That means that millions of middle-class taxpayers will be spared from paying higher tax bills.

The AMT was conceived in 1969 as an alternative tax to ensure that the wealthiest taxpayers, even with their big deductions and loopholes, didn’t avoid paying income taxes. But because the tax was not adjusted for inflation, it has increasingly reached down into the middle class.

Recently Congress has passed a series of one-year fixes, rather than overhaul the AMT itself. Last year, the long delay in passing the patch required the IRS to briefly postpone accepting some 2007 tax returns.

With the AMT patch and other tax changes included in the bailout bill, taxpayers should be able to file as usual starting January 2009.

Popular Tax Breaks Extended For 2008 Tax Returns

• The $250 deduction for teachers who buy out-of-pocket classroom supplies. This deduction is "above-the-line," meaning that teachers and educators can qualify for it even if they don't itemize their deductions. Allowable expenses include classroom supplies, books and software.

• A deduction of $2,000 to $4,000 for eligible taxpayers with higher-education tuition and related fees. This above-the-line deduction allows married couples with incomes of $130,000 or less ($65,000 for individuals) to deduct up to $4,000 in higher education expenses and those couples earning $130,000 to $160,000 ($65,000 to $80,000 for individuals) to deduct up to $2,000.

• The option to deduct state and local sales taxes from federal taxes, instead of state income tax. This can mean big savings for taxpayers who itemize and live in states with no state income taxes: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming.

• Tax-free distributions to charities. IRA owners who have reached age 70½ — and who must therefore begin to withdraw money from their retirement accounts — can contribute up to $100,000 of otherwise taxable payouts directly to charity.

Bill Includes Disaster Relief for 2008 Midwest Storm Victims

The new law provides major tax breaks for victims of the tornadoes, storms and flooding that hit the Midwest this year between May and August, similar to those given to Hurricane Katrina victims. These include tax benefits for demolition and clean up, as well as education and housing.

The bill also offers more limited tax assistance to victims of Hurricane Ike.

Check Back With TurboTax

The new law contains many changes to taxes for individuals and businesses. More details will be added at TurboTax.com as they become available.

_Updated for tax year 2009. Content provided by Kiplinger, courtesy of TurboTax, a registered trademark of Intuit Inc._

10 Things You Should Know About Credit Cards

Monster.com — Wed, 04 Feb 2009 10:10:00 -0800

h4. 1. Interest Backdating

Most card issuers charge interest from the day a charge is posted to your account if you don't pay in full monthly. But, some charge interest from the date of purchase, days before they have even paid the store on your behalf!

Remedy: Find another card issuer, or always pay your bill in full by the due date.

h4. 2.Two-Cycle Billing

Issuers using this method of calculating interest charge two months’ worth of interest for the first month you failed to pay off your total balance in full. This issue arises only when you switch from paying in full to carrying a balance from month to month.

Remedy: Switch issuers or always pay your balance in full.

h4. 3. The Right to Setoff

If you have money on deposit at a bank and also have your credit card there, you may have signed an agreement when you opened the deposit account that permits the bank to take those funds if you become delinquent on your credit card.

Remedy: Bank at separate institutions, or avoid delinquencies.

h4. 4. Fees Are Negotiable

You may be paying up to $50 a year or more as an annual fee on your credit card. You may also be subject to finance charges of more than 18 percent.

Remedy: If you are a good customer, ask the bank to drop the annual fee and reduce the interest rate. Otherwise, you can switch issuers to a lower-priced card.

h4. 5. Interest Rate Hikes Are Retroactive

If you sign up for a credit card with a low "teaser" rate, such as 7.9 percent, when the low rate period expires, your existing balance will likely be subject to the regular and substantially higher interest rate.

Remedy: Pay in full before the rate increase or close the account.

h4. 6. Shortened Due Dates

Most card issuers offer a 25-day grace period in which to pay for new purchases without incurring finance charges. Some banks have shortened the grace period to 20 days -- but only for customers who pay in full monthly.

Remedy: Ask to go back to 25 days.

h4. 7. Eliminating Grace Periods

That fabulous offer you received in the mail for a gold card with a $10,000 credit limit and lots of features may not be so great. The most common "string" attached is the card has no grace period. You are charged interest on everything from the day you buy it, even if you pay on time.

Remedy: Throw the offer out!

h4. 8. Disappearing Benefits

Many banks entice you to sign up with extra benefits such as lifetime warranty, a 5 percent discount on all travel or protection if an item purchased is lost. Now, some banks have cut back on these extras without the fanfare that launched them.

Remedy: Read annual disclosure of changes, and switch cards if need be.

h4. 9. Double Fees on Cash Advances

Most credit cards impose both finance charges and a transaction fee on cash advances. Interest starts from the day of the advance, and the transaction fee can be up to 2.5 percent of the amount taken. Beware of cards advertising "no finance charges." Transaction fees may still apply.

Remedy: Limit cash advances.

h4. 10. Misleading Monthly Minimums

You may think it is beneficial to have a card where you only need to pay 2 percent to 3 percent of your balance monthly. It is just the opposite. The bank stands to make far more money from finance charges the longer you carry out payments -- and you foot the bill.

Remedy: Pay all you can monthly.

Six Tips to Put Your Financial House in Order

Kim Lankford / Monster.com — Wed, 04 Feb 2009 10:10:00 -0800

If you want to spend less time worrying about your money, then it’s time to get your financial act together. These six strategies can help improve your financial situation and simplify your life at the same time.

h4. 1. Put Your Savings on Autopilot

If you haven’t maxed out your 401k or other retirement plan at work, add an extra $50 or $100 every month. Increasing your contributions just a little can make a huge difference over time. By adding $100 per month when you’re 25, you’ll have an extra $330,000 in your 401k by the time you’re 65 if your investments return 8 percent annually, which is below the average long-term return for stocks. Since the investments are pretax, your $100 monthly investment will lower your paycheck by $75 if you’re in the 25 percent bracket. If your employer matches your contribution, you’ll get free money to help you save even more. And it’s the easiest way to save, since the money is automatically invested before you can touch it. If you’ve maxed out your 401k, invest $333 automatically every month in an IRA. Ask your IRA administrator to set up automatic payments.

h4. 2. Stop Worrying About Your Investments

Instead of pouring over your investment options and wondering when - and what - you should buy and sell, have the experts do it for you. Most mutual fund companies, and quite a few 401k plans, now offer target funds that match your investments to your savings time frame. If you’re in your mid-30s, for example, you can invest your retirement money in a 2040 target date fund. This fund invests aggressively when you have more than a decade to go before retirement, then gradually gets more conservative as you approach retirement. These funds are diversified, so you don’t need to invest your retirement money anywhere else.

h4. 3. Pay Bills Automatically

Signing up to have your bills paid automatically from your bank account saves you monthly check-writing hassles and mail-delivery worries; it also protects you from costly missed deadlines. After one late payment, some credit-card companies boost interest rates beyond 31 percent and charge late fees of nearly $40. And some card companies raise your rate if you miss a deadline on another card, even if you have a spotless record with them.

h4. 4. Streamline Your Files

Go through your financial files and toss what you don’t need. In general, you should keep your tax returns forever, but you can get rid of supporting documents after three years (six years if you have self-employment income). You can also get rid of monthly investment statements after everything matches with your year-end summaries and ATM receipts as soon as the transactions appear on your monthly bank statement.

h4. 5. Protect Your Identity the Simple Way

Instead of signing up for expensive services that monitor your credit records for identity theft, do it yourself for free. You can now get a free copy of your credit reports from each of the three bureaus (Equifax, Experian and TransUnion) every 12 months. Stagger your requests so you get one report every four months. Review each one carefully for errors or unauthorized charges.

h4. 6. Get Out of Debt

The best thing you can do to improve your financial health is eliminate high-interest debt. Try to use any bonus, raise or tax refund to pay off credit cards in full. Even adding a few hundred dollars to your payments can make a huge difference, especially if you can get your credit card company to lower your rate. If your minimum payment is 4 percent of your debt, a $5,000 balance with an 18 percent interest rate would start with a $200 monthly payment, which would take 32 months to pay off and cost $1,314 in interest. If you pay $500 per month on a 5 percent card, you’ll cut your interest charges to $118 and pay off the balance in just 11 months.

How does this simplify your life? Once you’re out of debt, you won’t have to juggle minimum payments, and you’ll save a ton in interest, which frees up extra cash to reach the rest of your financial goals.

Streamlining Your Personal Financial Documents

By Janet Barclay, MVA — Tue, 03 Feb 2009 09:52:00 -0800

Every week you introduce more paper into your home, in the form of newspapers, magazines, flyers, coupons, schoolwork, correspondence, bills, and other documents. It may or may not be difficult for you to ensure that reading material and advertising is discarded when you are finished with it, but when it comes to financial documents, it can be much more challenging to determine what you need to keep, and what you can toss. Here are a few simple guidelines.

Discard credit and debit card receipts and bank slips once the item has cleared your account, except in the following circumstances.

a) You will be claiming the expense on your income tax return. All supporting documentation must be retained for a designated period of time in case of an audit. You should check with your local tax authorities if you’re not sure what the regulation is where you live.

b) The item is under warranty, in which case you may be required to provide proof of purchase in the event of a claim.

c) The item is expensive and unique, and you will require proof of purchase in case of an insurance claim.

It is important that the receipts be filed under the appropriate heading (Tax, Warranties, or Insurance) so you don’t waste time looking for what you need when it’s time to make a claim or file your income taxes. These events can be stressful enough, so why make it even more frustrating for yourself?

If you are holding onto receipts simply as a reference of your expenses, considering entering the information into a software program such as Quicken or Microsoft Money. This will not only free your home of some of the paper, it will allow you to easily track your income and expenses and to quickly look up any needed information. These programs will also help you to keep track of your current account balances and upcoming bills and to create and track a personal budget.

If you don’t want to buy and learn a new software program, you can enter your information into a spreadsheet or database program instead. Other options would be to type the information into a word processor, or to manually enter it into a paper ledger book, but neither of these will give you the reporting power of a financial software program.

When discarding the documents you no longer need, it is highly recommended that they be shredded to avoid the risk of identity theft. This is especially important when dealing with financial documents which may include account numbers as well as your name and address.

Unless you are claiming the expense on your income tax, utility bills and the like can be discarded after a year, as can bank and credit statements. Most companies will not make adjustments if an error is not reported within that time.

By following these simple guidelines, you will reduce the paper clutter in your home, the amount of space you require for your filing system, and the stress and frustration of wasting time searching for the documents you need.

About the Author

© Copyright 2005 Janet Barclay. All Rights Reserved. Janet Barclay, Organized Assistant, offers a variety of professional quality services to support entrepreneurs and other individuals who are overwhelmed by the demands and technology of the 21st century. For further information, please visit her website at www.organizedassistant.com.

5 Insurance Myths Busted

Military.com Finance Center — Tue, 03 Feb 2009 09:51:00 -0800

Misinformation and myths plague the insurance industry. Many times consumers aren't sure how much insurance to purchase or if they have purchased the right kind to begin with. If you're one of the thousands of Americans that don't understand insurance and what it offers read this list of the top 5 insurance myths and the facts behind them."

h4. 1.) Auto insurance covers personal property left inside your car.

Nope. You’ll need renters insurance to cover the stuff in your car. “Renters insurance will cover any of your items, anywhere in the world,” says Etti Baranoff, associate professor of insurance and finance at Virginia Commonwealth University in Richmond, Va.

h4. 2.) My landlord’s apartment building insurance covers my belongings.

As a renter, you’re responsible for covering your items; your landlord isn’t. That’s why you need renters insurance. One of the first things to do after you get a policy is to either buy or borrow a digital camera to photograph everything you own. Store the photos on a portable drive that you can keep in a safe place. These photos will make it easier for you to remember what you own and report what you lost. To further help you document your belongings, The USAA Educational Foundation offers an inventory worksheet at www.usaaedfoundation.org/house/home_inventory_worksheet.asp.

h4. 3.) You’re covered by your auto insurance when you rent a car.

You’re probably covered. Most auto insurance policies — and even the credit card you use to pay for the rental — protect against theft and damages to a rental car. But there’s also a loss-of-use fee that usually isn’t covered. “This fee covers lost income to the rental car company when the car is out of service for repairs,” says Carolyn Gorman, a vice president at the Insurance Information Institute. “It can add hundreds of dollars in costs if the damaged car is out of service for a long time.” Be sure to check your coverage with your insurance and credit card companies before you rent.

h4. 4.) You’re young and healthy and have no assets. You don’t need life insurance.

Here are a couple of reasons it’s the right time.

* -Since you’re younger, you may lock in a lower premium rate. As you age, the rates get more expensive.
* -As you get older, there’s a chance you could develop health problems, which will make it hard for you to get life insurance.
* -If you have credit card debt or college loans, the policy can help pay them off if you die unexpectedly.
* -The final expenses, such as a funeral or hospital bills, won’t fall to your parents to pay.

h4. 5.) Red cars are more expensive to insure.

The color doesn’t matter. Things that do affect the price are the cost of the car, your driving record, and where you live.

About USAA
USAA, a diversified financial services company, is the leading provider of competitively priced financial planning, insurance, investments, and banking products to members of the U.S. military and their families. Named by BusinessWeek as 2007’s Customer Service Champion and ranked highest among financial services companies for customer advocacy in a Forrester Research survey, USAA provides convenient and accessible financial products to its more than 6 million members. For more information about USAA, or to learn more about membership, visit usaa.com.

7 Ways to Lower Your Utility Bill

Ethan Ewing for Military.com — Tue, 03 Feb 2009 09:50:00 -0800

The average American home will spend $990 on heating this year, according to the Energy Information Administration (EIA). Add that to the rising costs of food, clothing, and travel, and almost every individual and family will feel the pinch.

Fortunately, you can make your utility bills more manageable. Many steps to reducing your bills apply to everyone, even those living in barracks. And even if your utilities are currently paid as part of your rent, pay attention: By 2010, only 10 percent of military personnel will live in government-owned residences, and many private or service-owned residences require residents to pay their own utility bills, reports the EIA.

1) Turn down the heat. Much as we love a cozy home, lowering the thermostat will instantly lower your bill. The EIA says projects that for every degree you lower your heat, you can cut your heating costs by as much as 5 percent. At night, or when you are away, lower the temperature as far as possible while protecting your health and the safety of your pipes. Bundle up with a throw on the sofa, get some warm slippers, and wear a sweater or fleece. If necessary, stay cozy at night with an electric blanket, which uses less energy than heating the entire home or apartment.

2) Program the temperature. Make furnace settings automatic by installing a programmable thermostat. These devices cost about $40 and are simple to install.

3) Replace light bulbs. Replace traditional incandescent bulbs with compact fluorescent lights (CFLs) to save about 50 watts per light bulb and make a significant difference on utility bills. They do cost more to purchase, but they pay off over the life of the bulb. If you move frequently, you might want to keep the old bulbs to leave behind in the fixtures while taking your investment in bulbs with you.

4) Cut laundry costs. Wash clothes in cold water -- they will last longer and still get clean while saving energy. Hang clothes to dry, either outside or on a line in a garage, bathroom or spare room. If you do use the clothes dryer, try to use an Energy Star certified model, and be sure to clean the lint filter before every use to maximize air circulation.

5) Insulate. Carefully inspect your home for drafty spots where cold air can enter. The most common culprits are doors and windows. Install weather stripping and door sweeps to block drafts. Add old-fashioned "draft dodgers" for a quick fix at exterior doors. Other common areas for air leaks are locks, outlets, air conditioning units and recessed light fixtures. Cover outside vents, including air conditioning units. If possible, install insulated electrical outlet boxes and light fixtures. The Energy Star program offers a free guide to home insulation at http://www.energystar.gov/index.cfm?c=diy.diy_index.

6) Use the sun. The sun is a great source of natural energy. Taking small steps such as opening the drapes to let the sun's warmth in during the day, and closing them - or install insulating drapes - to keep heat in at night will make substantial differences in your heating bill. Leave lights off if sunlight provides enough light by which to read, shower, cook or eat.

7) Choose budget billing. Consider contacting your utility provider to ask about billing a set amount each month. Called "budget billing" by some utilities, the company averages your annual utility bills and bills one-twelfth of the amount each month. Bills usually will be slightly lower in the winter and summer and slightly higher in the spring and fall. Most importantly, the bill will be a predictable amount each month to simplify budget planning. (Those in Service-provided housing might already have this feature on their bill.)

If you find you can’t pay your utility bill, get help. Many states offer programs to help people keep the utilities on when they have trouble paying the bills. Contact your utility company to learn about its plan, and be sure to mention that you are a military family. For instance, Ohio's Patriot Plan is based on a law that states that utilities can’t be disconnected for nonpayment for any military reservist or National Guardsman deployed on active duty. In an emergency, organizations such as the Salvation Army might be able to help.

These actions share one common feature: The No. 1 action you can take to rein in your utility bills is to pay attention to the energy you use, and try to use only what you need. When you use utilities carefully, you'll be able to reduce your bills, while still enjoying the comfort of your home, while you're in the Service and beyond.

Streamlining Your Personal Financial Documents

By Janet Barclay, MVA — Fri, 30 Jan 2009 04:59:00 -0800

Discard credit and debit card receipts and bank slips once the item has cleared your account, except in the following circumstances.

b) The item is under warranty, in which case you may be required to provide proof of purchase in the event of a claim.

c) The item is expensive and unique, and you will require proof of purchase in case of an insurance claim.

About the Author

Tax Deducations for Teachers & All Educators

Jill Hare, Editor | TheApple — Thu, 29 Jan 2009 12:04:00 -0800

It's almost tax time again, and if you're an educator, you don't want to miss out on deducations that your career spending can qualify you for. To make sure I had the correct information to pass along to you for filing your 2008 taxes, I asked my talented tax man for the latest. Here's the specific information, right down to the line on the tax form for those of you who file your own taxes:

Grades K-12 teachers, instructors, counselors, principals and aides can deduct up to $250 of out-of-pocket expenses on line 23 of Form 1040 (up to $500 if MFJ and both spouses are educators.) To qualify, the taxpayer must have spent at least 900 hours during a school year as an educator. Qualified expenses included amounts paid for books, supplies (other than nonathletic supplies for course of instruction in health and PE), computer software and equipment, and other equipment, and materials used in the classroom. Amounts that cannot be deducted above the line can be deducted as unreimbursed employee business expenses, subject to the 2% of AGI limit.

Quick Reference Tax Summary for Educators:

• You must be a full-time educator (900 hours per school year)

• The equipment or materials you deduct must have been purchased for classroom use

• You can deduct up to $250 per person ($500 if both you and your spouse are educators)

• Mark these deductions on line 23, Form 1040

How Much Should You Save?

By Kim Lankford, Monster Contributing Writer — Fri, 23 Jan 2009 07:39:00 -0800

If you're 40 or younger, it's tough to predict how much money you might need when retirement is decades away. A few key calculations, however, can help you make sure your savings plan is on track.

h4. Saving Depends on Life Stage

Rebecca Pace, a Cincinnati-based financial planner and CPA, recommends putting aside at least 10 percent of your income when you're in your 20s and 30s -- and even more if you're single. "I wouldn't expect they could continue to add a lot to it while they're raising a family, but if they've put something aside early, it should continue to work for them until they can save again," she says.

Another good reason to save aggressively now: The younger you are when you start, the longer your money will have time to grow. This means you'll need to set aside a lot less to reach the same goal than if you waited just a few more years to get started.

For example, if you're 25, you only need to invest about $3,600 per year to end up with $1 million by the time you're 65 if your investments return 8 percent per year. But if you wait until you're 30 to start, you'll need to set aside about $5,400 per year to end up with the same $1 million at age 65. And starting at 40 requires $12,700 a year to reach the same magic $1 million. Finally, you'll need a whopping $34,000 per year to reach the same goal if you procrastinate until you're 50.

A recent study by T. Rowe Price reveals most people need to set aside at least 15 percent of their pretax salary for their investments to replace 50 percent or more of their current salary in retirement. This may be enough if you're getting an extra 20 percent or more of your preretirement income in Social Security and pension payouts. But you'll need to fill more of the gap yourself if you don't expect to receive a pension, live in an expensive area or will still have a mortgage or other housing payment after retirement.

h4. How to Afford to Save

The reality is that it isn't always easy to set aside money for retirement when you're nowhere near your peak income and just trying to pay your regular bills. The good news: You have plenty of help. The IRS and most employers kick in some money, so you can set aside a substantial amount of money without taking much of a hit in your paycheck.

For example, if your employer matches 50 cents on the dollar for up to 6 percent of your salary and you earn $40,000, you'd get the maximum match if you contribute $2,400 in a 401k. In that case, you'd get $1,200 from your employer, bringing your total contribution up to $3,600.

And that $2,400 doesn't lower your paycheck dollar for dollar either, since you're investing the money pretax. If you're in the 25 percent bracket, investing $2,400 would only reduce your take-home pay by $1,800 for the year. So it actually would cost you just $150 per month to end up with a $3,600 contribution every year. Start at age 30, and you'd have about $670,000 by age 65.

If you can also afford to invest $200 per month in a Roth IRA, your total savings rate would rise to 15 percent of your $40,000 salary. Continue to invest that much for 35 years, and you could end up with more than $440,000 at age 65, totally tax-free under Roth rules. Add the two together, and you'd have more than $1.1 million for retirement.

h4. Trick Yourself into Saving

Even with all these benefits, you may not initially be able to afford to save 15 percent of your salary. And you shouldn't be setting aside that much until you cover your other bases first -- keeping three to six months' worth of living expenses in an emergency fund so you don't have to raid your retirement account (and pay steep penalties) if unexpected expenses crop up. It's also essential to pay off high-interest credit card debt first so you don't waste money on monthly interest charges.

But once you've met these obligations, the best way to maximize your money is to get it into savings before you can spend it. With a 401k, the money is subtracted from your paycheck before you see it.

You can also make automatic investments into a Roth IRA. Even just $100 per month can add up to $1,200 a year. And if you're 30 now, keep saving at that pace for the next 35 years and your investments earn 8 percent annually, you'll have about $220,000 tax-free by the time you're 65.

While you'll still need to increase your savings rate when you can afford to, these examples demonstrate it's never too early to start. And it's easy to increase your savings rate whenever you get a raise, bonus, tax refund, gift or any other form of extra money. When you're used to living on less, it's easy to invest the extra cash before you can spend it.

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