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5 Ways To Prevent Identity Theft

Patrice C. Washington — Thu, 16 May 2013 16:18:23 +0000

Don’t be fooled! Just because you haven’t been fully exposed to the reality of identity theft, it doesn’t mean you’re exempt. Researches say that if you haven’t been exposed to identity theft already, you know someone who has. According to the Federal Trade Commission, stolen identity was the No. 1 complaint from 1999 to 2010 and fraud amounts average between $48 and $54 billion per year!

You have to know that with our growing societal dependency on social media, and cellphones/ smartphones, we’re so much more exposed to the realities of identity theft. And, in this day and age, what can you do? Many of us use these means to stay connected to the world and expand our businesses, so hiding out is not quite going to do the trick no matter how much you attempt to disguise that Facebook avatar!

Lucky for you, we’ve compiled a list of a few things you can do to protect yourself from this costly epidemic.

Look at how you receive your mail and important documents. In many neighborhoods, your mailbox is not necessarily secured. You’re at the mercy of trusting people simply walking by. We’d hope that everyone would be honest, but unfortunately, it doesn’t always work that way. Switch to online or “paperless” statements from your financial institutions and other service providers. Or, think about utilizing a P.O. Box. Both may seem like a little more work, but not nearly as much as dealing with the headache of your identity being stolen!

Monitor your finances routinely. Far too often, people don’t realize their finances have been compromised until its pretty late in the game and too much damage has been done. What I’ve found for many people is that getting the mail out of the mailbox is one thing, but actually opening it up and reading it is another! You need to know what’s going on with anything associated with your name and social security number. Don’t ignore envelopes from companies you didn’t open an account with. . . That’s the point! If they’re sending you something, maybe somebody else did!

Check your credit often. And by often, we mean more than that one time of year you can get the free report from annualcreditreport.com. Typically you can find credit monitoring services through your financial institution or even the credit bureaus directly. You want to receive an alert as soon as a new account is applied for or opened in your name.

Use more than one password. I know, I know. It seems like too much trouble to memorize all these passwords, but if it keeps a crook off your heels and out of your wallet, isn’t it worth it? Use PINs and passwords with numbers, symbols and upper and lowercase letters that are difficult to guess. Remember, difficult means difficult. If I know your spouse’s name and children’s names 10 minutes into meeting you and can crack the password, you probably need to put a little more creativity into it.

Try out an identity protection service. Now, think about this like car insurance. You can have a black belt in defensive driving, but the reality is you’re still at the mercy of others while you’re out in the world minding your own business. If someone hits you, isn’t it great to be able to call your insurance company and have them handle all of the paperwork, phone calls, negotiations, etc? Now, if you’re identity is stolen, identity protection services can do the exact same thing!

Did you know that the average person will spend 165 hours working on closing accounts opened in their name due to ID theft? They spend another 58 hours correcting problems on existing accounts. Unless you can take three full weeks off of work to make this your full time job, you may want to consider it! And look specifically for companies like ProtectMyID which happens to be offered by the credit bureau, Experian.

Everyday somewhere in this country, an identity theft victim loses the opportunity to realize their dreams. Whether its not being able to obtain financing for a mortgage or auto loan or not being able to even take out a student loan, dreams are crushed because of lack of planning and preparation in this area. Get serious about making sure its not you.

BlackStartup: The African American Solution To Crowdfunding

Hayat Mohamed — Tue, 14 May 2013 20:08:16 +0000

In the past five years, crowdfunding sites like Kickstarter and Indiegogo have revolutionized the way entrepreneurs go about raising capital for new business ventures. Although these sites have helped turn countless of startup pipe-dreams into a reality, a significant number of entrepreneurs, Blacks in particular, aren’t necessarily feeling the same love…until now.

BlackStartup recently made its debut with a crowdfunding platform that focuses on funding projects and ideas benefiting African Americans.

Founders Nathan Bennett-Fleming, Olugbolahan Adewumi, Aaron O. Brien, Kyle Yeldell, and Christopher Hollins are determined to close the “Black startup gap,” as they call it, by attempting to fix the root cause: lack of capital.

“I think it is important that we encourage non-profits and social enterprises to raise resources on our platform to address social problems facing the African-American community,” BlackStartup CEO Nathan Bennett-Fleming told NewsOne.

Financial Freedom: Will You Have To Work During Your Retirement Years?

Ingrid M. Ellis — Tue, 14 May 2013 14:16:59 +0000

Did you know that McDonald’s and WalMart have the highest employment rate of elderly people? I know you’ve seen them: greeting at the door, checking your returned items, slowly taking your order at the drive-thru window, cashiering. Will that be you? Will you have to work during your retirement years? Sadly, most people will not be in a position to retire from working until they are well into their 70′s or even 80′s.

Most times when I sit with a client I ask, “At what age do you want to retire?” They often say, “Tomorrow” to be sarcastic or “By 65,” to be hopeful. The reality is, if you did not start stacking your chips early, it is unlikely for you to have what you really need by the time you reach retirement age. I know you may be reading this with a little side-eye but it’s the truth.

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If you are in your mid 30′s, early 40′s or later and you have not started investing your money aggressively before now, you are going to be in trouble in the next 20-25 years – unless you receive a large sum of money. Some people are disillusioned to think that Social Security will be available to factor in to your retirement needs. Have you read that statement lately? It clearly tells us not to depend on that system and to create other means of survival during your latter years. It all boils down to saving your money. Although you may not have had the education necessary to understand the importance of the “Rule of 72″ or the “power of compound interest,” it is still in your best interest to establish something that will help you achieve your ultimate goal, independence.

Read: Financial Freedom – Are Baby Boomers Outliving Their Income?

Discipline is the key in order to have money for the future. You have to be willing to make some sacrifices now so that you don’t pay the high cost of waiting later. If you don’t, you will find yourself coming out of retirement to work another job to make ends meet. Real talk! What I love is, it doesn’t take a lot in order to have what you need down the road. You don’t have to have goo-gobs of money, you just need to know what to do with what you have in order to be able to achieve a significant reward. That’s where meeting with a financial professional is going to come in handy. You need someone who can assess your needs, find out what you want and help you create a plan to get there. Don’t make the mistake of thinking you have time. Michael Jackson said it best, “Time Waits For No One”. Get your life together today so your tomorrow isn’t filled with shoulda-coulda-woulda.

Do You Really Know What Personal Finance Is? No Worries, We’ve Got Your Back!

Patrice C. Washington — Thu, 09 May 2013 17:17:08 +0000

If you were embarrassed by that question, don’t be. More people should actually ask and more personal finance gurus should stop assuming that everybody knows! Personal finance deals with your individual relationship with money. It serves as your financial outline; speaking to the way you obtain, budget, save, spend and manage monetary resources overall. These behaviors are assessed at various stages throughout your lifetime, taking into account a mixture of financial risks, as well as major life events like getting your first job or getting married.

Some of the major components of personal finance may include checking and savings accounts, credit cards, consumer and student loans, investment principles, income tax management and much more depending on which phase of life you are in. Despite which stage you fall into at any given time in your life, a positive relationship with money forces you to continuously assess the questions: “How much money and financial assets do I possess today?”, “How much money will I need at various points in the future?” and “How do I go about getting that money in the present?”

These questions are the foundation for creating a personal financial plan. The most basic plan will always include these five steps:

1. Assessment: Where are you now?

2. Goal Setting: Where do you want to be?

COMMENTARY: Are Deion Jr.’s Versace Sheets Over the Top or Fitting For ‘Prime Time’s’ Son?

Michael H. Cottman, BlackAmericaWeb.com — Wed, 08 May 2013 00:00:14 +0000

Deion Sanders Jr. is just a freshman at Southern Methodist University but he’s already living large by sleeping on gold satin Versace sheets in his college dorm room.

Junior’s father, former NFL star Deion Sanders, widely known as “Prime Time,” tweeted a picture of his son chilling on the glitzy Versace sheets.

As a parent, I’m not criticizing Deion Sr. for buying Junior the high-end bed sheets. After all, Sanders has gone through a tough divorce with an ex-wife who appears to be a bit unstable, and, by most accounts, Sanders seems to be a devoted and responsible father.

It’s no secret that Sanders likes expensive toys and is naturally drawn to bling; it’s part of his “Prime Time” brand and there’s nothing wrong with that. My only question is this: What message is Sanders sending to Junior when it comes to practical spending, saving money, and wise purchases?

“As a young adult, even if you don’t have or earn a lot of money, the financial decisions you make today can affect your lifestyle now and for years to come,” Luke W. Reynolds, Chief of the FDIC’s Community Outreach Section, told Black Enterprise magazine. “The good news is you don’t need to be a finance expert to take charge of your financial future. A few basic concepts can go a long way.”

Perhaps Prime Time has already had the financial talk with his son since Deion Sr. has earned a good sum of money from the NFL, CBS Sports and endorsement deals. He seems to be a smart self-marketer and knows how to earn a high-profile living so he could indeed be passing along his wisdom to Junior.

It’s not like Sanders can’t afford Versace sheets: He’s worth an estimated $40 million.

Sanders has earned his net worth as one of the most versatile athletes in sporting history. He played for the Atlanta Falcons, the San Francisco 49ers, the Dallas Cowboys, the Washington Redskins and the Baltimore Ravens, playing multiple positions such as cornerback, but also occasionally as a wide receiver, kick returner, and punt returner. In baseball, he played for the New York Yankees, the Atlanta Braves, the Cincinnati Reds and the San Francisco Giants. He is currently an NFL Network analyst.

In February 2011, Deion listed two of his Dallas area homes for sale. One was listed for $7.5 million and the other for a $21 million. The $21 million mansion is 30,000 square feet and has eight bedrooms, 10-car garage, movie theater, bowling alley, basketball court and a 12-acre lake.

Still, with all of Sanders’ wealth, young adults like Deion Jr. need guidance and financial direction earlier in life these days as college, housing, cars, and life’s expenses become more costly.

Taxing Online Shopping

Mellody Hobson, special to BlackAmericaWeb.com — Mon, 29 Apr 2013 08:00:16 +0000

Mellody Hobson talks to listeners about the change in online shopping on this week’s “Money Mondays.”

Mellody, you want to talk to us about online shopping today.

That’s right, Tom. And I’m afraid I don’t have great news for most people. Last week, Congress cleared the way for a bill about online sales taxes known as the Marketplace Fairness Act, and it’s going to mean big changes for businesses and consumers. Right now, if an internet business has no physical presence in the buyer’s state, it doesn’t have to charge tax on the sale. The onus is left on the buyer to report the purchase—which can be done on your state income tax form. In reality, practically no one does this, so taxes go uncollected.

Under the proposed law, sellers would have to pay the sales tax to whatever state they ship the purchase to. This levels the playing field in that pure online retailers, such as Amazon.com, would be subject to the same rules as Walmart.com. Because Wal-Mart has actual stores in every state, it is required to collect sales tax on every transaction. This is not small potatoes. U.S. shoppers spent $225 billion online last year, so we’re talking about up to $24 billion in sales tax that now goes uncollected.

Okay, so who wins and who loses?

The winners are local economies who will collect all that tax money and the losers are consumers—who will have to pay it. Also losing are online businesses, who will have to charge more for their products in order to collect the tax.

Gold Losing Its Luster

Mellody Hobson, special to BlackAmericaWeb.com — Mon, 22 Apr 2013 07:00:43 +0000

Gold has been making headlines lately for its plummeting value. What does that mean for us?
The answer is not much. Most individual investors don’t own gold beyond what’s found in their jewelry box.

Gold is what’s known as a “fear trade.” Its price climbs when investors lose confidence in the traditional stock market. This is particularly evident when we look at historical gold prices. Gold hit an all time high of $1,900 an ounce during the market turmoil that followed a downgrade to the U.S. government’s credit rating in September of 2011. As a general trend, when the market falters, gold shines bright.

The good news is that I believe that the falling price of gold means that people are gaining confidence in the stock market. Gold is seen as a safe investment when the markets are not doing well—it’s a hedge against a declining stock market and inflation. Gold’s recent slump could mean rising stock prices.

Do you think gold is a good investment?
I do not believe gold is ever a safe investment because you can’t time when it is going to do well. For example, from March 1987 through May 2005, gold returned 0%—yes, ZERO for nearly two decades. Over that same period, the S&P 500 boasted an annualized return of over 10%.

Of course, there are other periods when gold has far outperformed the market, but it’s virtually impossible to guess when that will happen. Over the long-term, I think the stock market is a much safer and more practical investment. For one thing, shares of stock represent actual businesses that are creating value—be it products or services—whereas gold is just a hunk of metal that sits there. Unlike a business, gold won’t pay interest or dividends, and it won’t grow earnings. Even as a metal it doesn’t add much value—it’s primarily decorative, with 52% of its use in jewelry, 34% in investments and 12% industrial.

Spring Cleaning for Your Finances—Rubber Gloves Not Required

Mellody Hobson, special to BlackAmericaWeb.com — Mon, 15 Apr 2013 07:00:52 +0000

Mellody Hobson talks to listeners about cleaning up their finances on this week’s “Money Mondays.”

It’s time for some financial Spring cleaning?
That’s right. And I’m not talking about dusting your keyboard. Take a break from clearing the gutters and attacking all those bathroom nooks and crannies with a toothbrush and some bleach—It’s time to do some Spring cleaning of your finances.

Why is it so important?
A nationwide study conducted by LearnVest and Chase Blueprint found that about 50% of adults worry about money and 40% feel they lack control of their finances. That’s a lot of stress—and everyone is in a position to make it better. Taking stock of your finances is like purging your closet: An afternoon of hard work pays off. At the very least, it will help you get a handle on where you stand financially, giving you a better sense of control and a clearer vision about changes you need to make to reach your financial goals.

How do we go about doing it?
I suggest this five-step plan.

Step One: Check Your Credit
A Federal Trade Commission study of the U.S. credit reporting industry found that five percent of consumers had errors on one of their three major credit reports that could lead to them paying more for things like auto loans and insurance. Five percent doesn’t sound like much, but some studies quote as many as 70% of credit reports contain errors. It comes down to how you define “error.” Some things, like an incorrect address, will have no bearing on your score. Other things, like missed payments that never happened, could cause major trouble.

What kind of trouble? Higher interest rates and disqualification on loans and apartments, not to mention higher insurance premiums and in rare cases, even being disqualified for jobs.

This is why it’s so important to request a copy of your credit report from each of the 3 bureaus (Equifax, TransUnion, and Experian) on annualcreditreport.com. That is the only official site, so don’t fall for an impostor. If you’ve been denied credit, you can also get a free copy of your report from the bureau used by the lender who denied you. Should you find any errors on your reports, get to correcting them.

Financial Freedom: 3 Ways To Invest Your Tax Return

Ingrid M. Ellis — Wed, 10 Apr 2013 14:31:48 +0000

April 15th is quickly approaching. Many people are panicking to assure they get their taxes done before being penalized by the Internal Revenue Service (IRS). Some are fortunate enough to actually receive a return this year. Unfortunately, no matter how hefty the sum of return, a lot of families will frivolously blow through whatever monies owed them by the state and federal government on material things that can be done without (i.e., designer shoes, name brand clothes, flat screen televisions, etc). Now…I’m not saying having nice things is all bad but sadly, investing is the last thing on the minds of some. People often times feels as if they “have time” and can therefore wait to begin securing their families financial future. How wrong is this theory?!

For those who are considering using their returns wisely, here are some suggestions to get the ball rolling on some much needed savings.

Create a “wealth building” account. This is money specifically for retirement. Many jobs don’t offer “pensions” any longer and often times those who work for corporate America are left to religiously spend their money on low performing 401K plans. With any long term account, you want to make sure that you have access to the highest rate of return possible.
Establish a “short term” savings vehicle up to six months of income. This type of investment will allow you to save for unforeseen events, loss of job, disabilities, vacations, a new car…those short term horizon goals, usually 3-5 years. This is a great way to alleviate the possibility of you dipping into credit cards and creating unnecessary bills that you have to figure out how to pay off next tax season.
Open an “emergency fund”. You always want to have at least 3 months of income in this reserve account. Purchases that you will make in 0-2 years, vacations and other emergencies can be funded with this type of account.

You should also consider setting up college funds for your children. Whatever it is that you do, just make sure that you save. Life will not always be as it is today.

Getting Married? Prenups Aren’t Just For the Rich and Famous

Mellody Hobson, special to BlackAmericaWeb.com — Mon, 08 Apr 2013 07:00:24 +0000

I know people moan and groan about pre-nups, and at first blush, it’s easy to see why. A marriage is supposed to last forever, so managing its potential dissolution is hardly romantic.

It’s not candy and flowers.

They get a bad rap, but it’s not your mother’s pre-nup. A marriage is a contract, and a prenuptial agreement is putting finer points on that contract. It’s a legal agreement that specifies how couples will divide assets in the event of divorce. They’re not just for billionaires; They’re put in place to protect both parties; and with so much about gay marriage in the news, I also have to mention that they’re not just for straight people.

Historically, pre-nuptial agreements were for wealthy people who needed to protect extensive assets, a business or investments. But more and more middle class people are drafting prenups. A 2011 survey by the American Academy of Matrimonial Lawyers found that prenups had increased 73 percent over a five-year period. And this is interesting—more women are requesting them.

What do you attribute to the rise in popularity?
For one thing, an ailing economy has people thinking about money more. We all know that statistic about 50% of marriages ending in divorce (a trend that’s actually lowering), so people are being a little more realistic about a possible split. And people are getting married later in life. The average age of first marriage in the United States is 27 for women and 29 for men, up from 23 for women and 26 for men in 1990 and 20 and 22 in 1960. Because they’re getting married older, more people have actual assets they want to protect in the event the relationship goes south.

But what if both the bride and groom to be have no assets?
Great question. You can’t take half of nothing, right? Not so! In fact, you can end up taking half of less than nothing—meaning your spouse’s debts could haunt you. And again, I want to point to that rising age of newlyweds—more and more people are taking liabilities to the altar—like credit card debt and student loans. It makes perfect sense that spouses would want to protect each other from any liability one has going in. You’re saying “I do”, not “I owe.”

Also, you probably have some assets you haven’t thought about that you’d like to keep separate—like a retirement plan or an expected inheritance. Or what about property your parents may pass down to you and your siblings?