Make the Most of Your Rewards Program Membership

I’m often intrigued and sometimes inspired by stories of people traveling the world using points and miles. There’s a well-known (within certain circles, at least) man who earned over a million airline miles by purchasing more than $3,000 worth of pudding during a special promotion in 1999. Or, you might have heard about people using coupons during a grocery store’s membership-only sale to get food and household products for free.

While I might not be as enthusiastic as some world travelers, or as extreme as some couponers, I do see the benefit in a program that’s free to join and offers you potentially money-saving perks. However, I also know it’s important not to get so caught up that I wind up spending more money than I would otherwise. As a friend of mine loved to say, “never spend a dollar to save a nickel.”

The perks of membership. There are many loyalty or rewards programs to choose from and the rules and benefits can vary. For example, a grocer’s program might offer the same in-store savings and exclusive coupons to all its members. By contrast, travel rewards programs often have tiers, different levels of membership with varying benefits depending on how often you travel or how much you spend. While the basic tier may offer discounted hotel rates or free Wi-Fi, the higher tiers might come with free room upgrades (including to coveted suites) and guaranteed early check-in and late check-out.

Recognize why companies might have rewards programs. When you’re a big fan of a company or product, getting rewarded for your loyalty can be great. After all, it’s a free perk if you were going to make the purchase anyway. But try not to get too attached to a particular company or product based solely on the rewards program.

Buying something simply because you get a discount as a member, or making a purchase “for the points,” might be a waste. You could find yourself with a pantry full of products that are slowly going bad, or paying more for a trip because you didn’t comparison shop the offerings from other airlines or hotel chains.

Joining a rewards program could lead to overspending if you’re not careful. Recognizing that the programs could be designed to get you to spend more, and more often, can help you refrain from overspending. Here are a few additional ways to make sure you maximize your benefits.

Don’t double-count your savings. You’re tricking yourself if you consider the rewards points from a retailer’s program as savings when making a purchase and then consider the same points as savings (again) when you redeem them for store credit. Count the rewards once, or don’t make them part of your buying decision at all.
Keep your programs organized. Points in some programs expire if you don’t use them within a specified period or have recent account activity. You could use a website, app or spreadsheet to help track your accounts, how many points or miles you’ve earned and when they expire.
Another way to avoid overspending is to consider your net cost when comparison shopping. To do this, you’ll need a list of the dollar value of each programs’ rewards points. You could take a shortcut and copy the values other enthusiasts place on each program’s points. Or, you could make estimates of your own based on trips or purchases you regularly make.

Now you’ll know when 1,000 points are worth $1 or $10 and can plan your purchases accordingly. In the end, you want to be able to make as close to an apples-to-apples comparison as possible, inclusive of the value you place on the rewards.

Bottom line: Consumer rewards programs offer a wide variety of benefits, including exclusive savings and complimentary perks. While it’s often free to join the programs, and you could get rewarded for doing so, keep the big picture in mind and be careful about letting your membership lead to unnecessary purchases.

By Nathaniel Sillin

3 Ways to Live a Debt Free Life

There is one thing the majority of us are guilty of and often times it happens so fast, we don’t even realize it until it is too late–over-extending ourselves financially. It starts off when we are kids with a shiny new bike or the latest (and most expensive) video game system; and it extends all the way into adulthood with our houses, cars, clothes, and vacations.

Madonna’s old statement still rings true over twenty years later– we all just live “in a material world,” and because of it, most of us are always left desiring something that is just out of reach. Whether you are living on your own for the first time at college or starting over again later in life, it’s important to stay grounded when it comes to your finances.

One of the greatest positions you can put yourself in life is to be debt free; it simply means you have the financial flexibility to have options that people who are in debt unfortunately do not. It may seem like a daunting task, but living debt free starts on a basic concept–being smart enough to avoid accumulating an owed amount that is greater than the amount you can afford.

Here are three expert suggestions that can keep you and your family out of harm’s way on the proper path to financial freedom.

Be Smart with your Credit Cards– While there is nothing more dangerous than a freshly freed college kid with a credit card, letting our cards get the best of us is something that is certainly not solely reserved for the youth of the world. That is why a credit card should be looked at as a means to pay for emergencies much more than a false sense of purchasing ability.

Additionally, it is wise took into the many different options available to you as different cards offer different reward programs; still, experts recommend that it is best to use a card with benefits for big purchases only when you have the necessary funds elsewhere to pay for it. Remember, extending yourself, even for one billing cycle, can subject you to significant interest penalties.

There have been many studies done to show that swiping a card receives much less consideration then parting with cash; there’s just not as much of an attachment to it. Do not be one of the many who blindly swipes each month with no concept of the final bill until it hits their inbox.

Build Your Savings Early and Contribute Often – It’s always smart to start putting a little money to the side for savings the moment you begin to consistently earn a paycheck. If you are younger, it’s typically a fund for summer vacation or books in college, but as you get older, the concept of savings evolves and takes on a whole other level as both a retirement and emergency fund.

While it is not only fun, but important to live in the now and enjoy life, you should also begin pooling together anything you can spare to start a proper account as soon as possible. From there, set aside a small amount every other paycheck or bonus check to help grow the fund. Remember to keep in mind the most important rule of maintaining a savings account, though; the fund is for savings, not for spending!

Know Your Realistic Price Range for EVERYTHING– Whether it is the clothes you wear, the car you drive, or even the amount of times you go out to dinner, it is absolutely imperative that you know your true limit for spending. It’s easy to get carried away and follow trending styles or overdo it while out at the bar or at the game with your buddies, but haphazardly spending money can quickly put you in a financial bind.

That is why it is very important to establish a base line cost for common items and an understanding of certain situations, if any, allow for you to deviate from them. It’s okay to treat yourself on occasion, but don’t let it become too much of a habit until you can fully afford to do so. Playing it smart during routine purchases will allow you to keep more money to the side for big one off situations like buying a home.

Tax Season Brings Out the Tax-Related ID Theft Scams; Ways to Avoid Falling for Them

Here’s a gentle reminder that it is indeed tax season. While the actual day you have to submit your return is not until April, you should start gathering those tax documents now and file your return as soon as possible. This applies whether you are getting a refund or have to pay up. Once you file, a criminal cannot use your identity to file a claim, the IRS will immediately reject it as a duplicate filing. So if the scammer files a fake claim with your information first, it is a nightmare to get resolved.

Criminals wanting to deposit your tax return in their accounts or steal your identity are upping their game starting now. Those age-old IRS tax scams and likely some new ones will resurface, perhaps with a vengeance, for the next few months. And one of the best tips to avoid becoming a victim of tax-related identity theft is to file early.

The IRS defines tax-related identity theft as occurring “when someone uses your Social Security number to file a tax return claiming a fraudulent refund.” Scammers have many tricks to try and get that ever-so-personal number out of taxpayers. There are three main ways they do this; filing fraudulent returns, phone scams (vishing), and the ever so popular email or text message phishing. Here are a few examples that may show up this tax season:

1. Phony IRS agents call you up and inform you that you owe taxes. They come up with some official sounding “tax” you owe or they say you are owed a big refund. All you have to do is confirm your social security number (SSN).

2. You receive an email with a link that directs you to an official looking website asking you to update your IRS information. Of course, included in that information is your social security number.

3. You receive an email with a link directing you to a website that asks you to verify your e-file information for the IRS. This information includes your SSN, your credit or debit card number (for paying any tax due), address, etc.

4. Someone “official” shows up at your door unexpectedly and presents you with a badge that looks like it could be an IRS agent. You are told you owe taxes and her or she is there to collect payment or to take you to jail if you don’t pay.

Of course all of these are fake. The IRS has protocols in place for communicating with taxpayers and one thing you can be sure of is that no one from the agency will initiate communication with you using email, the telephone, social media, or by showing up at your door. They will first send a letter by US Postal Service.

The IRS also will never:

-Demand payment immediately without giving you the opportunity to appeal or discuss it.

-Require a payment method of wire transfer, pre-paid debit card, or gift cards.

-Ask for payment card information over the phone.

-Threaten to have you arrested for failure to pay any tax or fee.
According to the IRS, last tax season there was a 400% increase in phishing and malware incidents. The agency detected 35,000 fraudulent returns and prevented nearly $194 million from being issued fraudulently, as well. So once again, file early, because the IRS only accepts one filing per SSN. Beat the crooks to it.

If you have been a victim of tax-related identity theft, contact the IRS directly and complete IRS Form 14039 Identity Theft Affidavit. In addition, contact the Treasury Inspector General for Tax Administration and file a complaint with the Federal Trade Commission (FTC). More information can be found on the IRS and FTC websites.

© Copyright 2017 Stickley on Security

Autofill Feature Used to Relieve You of Unintended Details

You know the autofill feature that is in browsers these days? It is supposed to relieve you of having to constantly fill in details over and over such as your email address, phone number, and even credit card details when your filling in forms on web pages. Well, a Finn named Viljami Kuosmanen discovered how that time-saving trick can also relieve you of more information than you intend sending it off to the bad guys.

The feature can be activated in Chrome, Safari, and Opera and the vulnerability was proven to be found in all of those. What happens is when the data is requested on a form, it can also enter data into other text boxes, even if they don’t appear on the screen. So, say you’re adding your email address to a page to sign up for an online newsletter. If there is a box lurking in the background, it can also grab other details that are saved in the autofill settings of the browser like your address. Some plugins, such as LastPass can also be used this way with their profile-based autofill functions.

The best way to avoid this is to disable the autofill feature, no matter how tedious filling that information in the boxes gets. However, should you choose to use it, don’t add any payment card, bank account, or other sensitive data into your settings. For example, when Chrome asks if you want to save the payment card details in the browser, just click “no.” You can edit and delete the information stored in the autofill settings in your browser settings menus.

In addition, always make sure the anti-phishing features are active in your browsers and that you have anti-malware and anti-virus installed and kept up-to-date on your computers and devices.

There are a couple of bits of positive news with this. Firefox is not vulnerable because it doesn’t yet have the autofill functionality; although it is in the works. The trick also still relies on tricking users into entering the data in the fake form. So, as long as you know what to look for and are always on the lookout for phishing, you can avoid giving up your data when it wasn’t your intention.

© Copyright 2017 Stickley on Security

Refinancing Your Debt Could Be a Good Idea If…

Have you ever considered how lenders compare applicants? Typically, the lowest rate goes to those who have the highest likelihood of repaying the loan on time. A lot of data goes into determining that probability, including the person’s credit, income and outstanding debt.

As these factors improve, your terms on new loans might improve as well. You could also refinance debts you took on earlier in life to take advantage of the changes. As a result, you might be able to decrease your interest rate, lower your monthly payment and save a lot of money.

Refinancing, which is often done by taking out a new loan to pay off existing debt, can be surprisingly simple. In some cases, you can submit all the information online, and the entire process will only take a few days. However, refinancing more complex debts, such as a mortgage, can take considerably longer.

While refinancing doesn’t always make sense, it’s worth considering if you’re in one of the following situations.

Interest rates dropped. Some loans’ interest rates depend on a benchmark interest rate, such as the London Interbank Offered Rate (LIBOR). Even if your financial profile stays the same, when the benchmark rate rises or falls, your interest rate on a new loan could rise or fall as well.

You want to change the terms of your loan. Because you’re taking out a new loan to pay off existing debt, you might have the opportunity to change the terms of the loan. For example, you could have a variable-rate student loan whose interest rate rises or falls with a benchmark. You might be able to refinance with a fixed-rate student loan and have certainty that your monthly payments won’t change in the future.

If you have a lower interest rate after refinancing and have the same amount, or less, time to repay the loan, you can save money over the lifetime of the loan.

You want to lower your monthly payments. Say you have a 30-year mortgage that you’ve been paying off for five years. If you refinance with another 30-year mortgage, you have an extra five years to pay off approximately the same amount of money. As a result, your monthly payments could be lower, but be sure to take into consideration the fact that you will likely wind up paying more in interest.

Your loan has a cosigner. Perhaps you asked someone to cosign your auto loan to improve your chances of getting approved or getting a lower interest rate. If you’re eligible for refinancing on your own, you might be able to release your cosigner and take full responsibility for the new loan.

Proceed carefully because applying for refinancing could hurt your credit. Applying for refinancing often results in a hard inquiry, when a potential lender reviews your credit. Generally, a single hard inquiry won’t have a large negative impact on credit, but multiple hard inquiries might.

When you’re refinancing a mortgage, auto loan or student loans you can still shop around and try to find the best rate without worrying about your credit too much. As long as the hard inquiries happen within a 14- to 45-day period (depending on the credit-scoring model) the credit-scoring model will consider them a single inquiry.

Consider the fees and find your break-even point before refinancing. Depending on the type of debt and the lender, there could be costs associated with refinancing debt. For example, some loans have an origination fee, either a flat fee or a percentage of the loan amount, which could be significant.

The break-even point is how long it’ll take you to recoup the costs associated with refinancing. For example, it could cost you $3,000 to refinance your mortgage, but you’ll save $150 each month. You’ll break even after 20 months because that’s when you’ll have saved $3,000 in monthly payments. If you plan on selling the home before the break-even point, it likely doesn’t make sense to refinance.

Use the same sort of calculations to weigh the pros and cons of refinancing other types of debts. When it looks like refinancing could be beneficial, shop around to try and find the terms that best fit your needs.

By Nathaniel Sillin

2 Ways to Begin Planning for Financial Security

For many of us, the American Dream is all about creating financial stability through what we all hope will be a successful enough career to warrant an early retirement; and of course, the earlier the better. When it comes to realistically planning for the future, however, your late 20’s can be a very interesting time – personally, professionally, and financially.

Not only are you further removed from the antics of college and squandering paychecks; 30 is staring you right in the face, and it’s suddenly holding you accountable for where you’re at in life. The time is also creeping closer and closer for taking the next step with relationships, houses, babies, and every other part of growing up that can make you quickly feel old.

Most importantly, though, is the fact that for many of us, our late 20’s represents a time when we are finally in a steady occupation and earning decent enough money to start looking towards the future.  That is why it is so important to prepare and be in the right position to take advantage of that moment; here are two ways to initially place yourself on the proper path to financial security:

  1. Properly Leverage the Resources around You- Whether it’s as simple as sitting down with your recently retired parents who can help outline best practices or looking into additional retirement options with your office’s HR Department, you are doing yourself a significant disservice if you aren’t utilizing every resource around you on your quest to gain financial security. Often, your friends and family have already gone through life’s major events- houses, weddings, babies, etc; so why wouldn’t you learn from not only their successes, but from their mistakes too? This practice should start when you are about to graduate college as you can pick up a lot from your friends in terms of how to find a job, begin paying off debt, and establishing a savings account. From there, work with your employer to learn all that they offer from a retirement fund perspective. Businesses will often even match a certain percentage of your paycheck if it is allocated to your 401k; you’d be a fool not to take advantage of that free money by contributing the maximum that they’ll match. As you get older, pay attention to the changing landscape of financial opportunities that come your way; be ready for AARP and embrace Senior Discounts whenever possible. Seek professional assistance and know your finances/assets! Remember, you simply can’t retire, early or not, without first learning how to do so; not in the broad sense, but for your specific situation.
  1. Stay On Track Through Short Term Goals – It can be very easy to get lost and, therefore, frustrated in solely establishing long term goals for yourself, especially in areas of your life that are considered high stakes for the future. Experts suggest that providing yourself with quick goals that offer success early and often can go a long way in getting you in the right groove of practicing sound financial activity. For example, rather than just a broad goal of retiring by 40, create a series of smaller goals that can act as both checkpoints for maintaining progress as well as milestone moments for celebrating achievement. Your first goal should b a simple one- get a full time job. From there, your next goals can be paying off half of your student loan debt by 25; all of it by time you’re 30. While striving towards loan freedom, you could also establish a string of professional and personal goals to match up where you plan on being at that point in your life. For example, at 25, secure a management position; by 30 save enough to buy a ring and get married. The point is, your goals are going to change from time to time as your life does; so although it is great to have an end-game (i.e. the broad sense of “early retirement”), you need to create a set of firm short term goals to help lead you there. It is way too easy to get lost in something that always feels like a distant dream; knocking down these goals one by one will help you build momentum and gain the confidence needed to ultimately succeed.