My Personal Finance Blog

The almost $790 billion American Recovery and Reinvestment Act signed into law will provide some benefits to almost 95 percent of workers, but most provisions won\’t happen automatically.

The Recovery Act gives taxpayers money to spend, incentives to spend it, and choices to spend it on. There are provisions that pay you now and some that pay you later. But for most us, this isn\’t a check-is-in-the-mail plan.  All of us will need to be informed and take action in order to benefit from the Stimulus bill. Taxpayers will need to have guidance to maximize the benefit.

The Saunders Learning Group recommends taxpayers take note of five areas where you may benefit:

More money in your pockets now Help for those who are disadvantaged Homeownership becomes more affordable Increased access to higher education Getting green from the garage

Nearly everyone wants to know what the Recovery Act will do for you in terms of direct income, credits and deductions that you can benefit from.  Saunders Learning Group recommends consulting with a tax professional to help break down the changes and what they may mean to each individual.

Put money in your pocket now

The bill includes provisions that immediately puts money into wallets of all sorts of people including employees workers, the unemployed, and retirees. For both 2009 and 2010, the Making Work Pay tax cut means up to $400 for individuals and $800 for couples through a reduction in income tax withholding; in other words, bigger paychecks.  While week to week this is not a big change, it does help stretch your dollars. Eligible workers may need to work with their employers to ensure any adjusted income tax withholding is appropriate for their situation.

For example, if you transferred to the new reduced withholding amounts, you may actually owe more taxes when you file your 2009 and 2010 returns.  You will most likely want to sit down with a tax professional to work out how your tax situation is affected by these changes.  Most accountants, CPAs, or tax professional will provide a free assessment as part of their annual services, or any fee should be modest, so take advantage of the new provisions by reviewing your situation with your tax preparer or accountant.

For eligible self-employed taxpayers, you can adjust your quarterly estimated payments. For taxpayers who do not receive the full amount this year, you will receive the remaining as a credit on next year\’s tax return. Social Security and SSI recipients, retired and disabled veterans, and railroad retirees will get a one-time payment of $250. The Social Security Administration and Veterans Administration will provide the information about who qualifies for this payment; eligible individuals won\’t have to do anything. Individuals on a federal or state retirement program who don\’t receive Social Security benefits can claim a $250 credit when you file your 2009 tax returns.

If you qualify for both the Making Work Pay Credit and the $250 payment, you can\’t get the full amount of both benefits.  In these cases, the Making Work Pay Credit will be reduced by $250. For all the federal retirees who are used to double dipping that is not going to occur with this bill.

If You are Unemployed

If you are unemployed you can receive many new benefits.  Just remember, in most cases, these benefits are included in your taxable income.  Many will receive a $25 weekly boost to your unemployment check. In addition, the first $2,400 in benefits are exempt from federal tax in 2009. Eligible unemployed workers paying for COBRA will benefit from a 65 percent federal subsidy for your monthly insurance premiums.

Helping more of those who have less

This act also expands the Child Tax Credit, allowing families to start qualifying for a credit with every dollar earned over $3,000. For taxpayers, this change translates into a refundable credit of up to $1,000 for each qualifying child under 17. Refundable credits give taxpayers a real boost because if the person has no tax liability, the credit is issued in the form of a refund.

If you qualify for the Earned Income Credit (EIC), you will see increased benefits here too. The Credit for families now covers three or more children. Previously, EIC benefits were capped at two children.

Making homeownership more affordable

The Stimulus act also provides a new $8,000 tax credit for first time homebuyers. If you live in the house for at least three years, you will not have to repay the credit, should you move after that time period. To qualify, you must purchase a home between January 1, 2009, through November 30, 2009. Taxpayers who have purchase a home in 2009 can actually take advantage of this credit on their 2008 return. For those who have already filed, filing an amendment is the best way to capture this full credit on their 2008 tax return.  Consult your tax advisor or accountant.  The Stimulus plan also includes tax credits for energy-efficient improvements such as replacing qualified new furnaces, windows, and doors to existing homes. The credit applies to 2009 and 2010 tax returns, with a lifetime cap of $1,500.

Increasing access to higher education

More Americans will qualify for the American Opportunity Tax Credit, to get a new, partly refundable $2,500 tax credit for college tuition in 2009 and 2010. By making the credit partially refundable, nearly 4 million low-income students now can qualify for the credit. This is a better alternative for taxpayers than the two existing higher education credits.

A new provision expands which expenses can be included in the popular 529 college savings plans. If you are starting to spend for college under this plan, you can now include computer and computer technology costs as qualified expenses in 2009 and 2010. Previously, eligible expenses included only tuition, room and board, and books, supplies and equipment that were required for attendance at the school.

Go Green

The package allows taxpayers to deduct the state and local sales and excise taxes paid on the purchase of new cars, light trucks, recreational vehicles and motorcycles. The vehicles must be purchased between the enactment date of the Act through the end of this year.

The Act also provides a tax credit of up to $7,500 for families who purchase plug-in hybrid vehicles purchased after 2009 or plug-in conversion after date of enactment and before 2012. Even if you don\’t itemize your tax return, you will be able to benefit from this.  You will find a tax credit line for this on your 1040 tax form.  Again it is always best to consult a tax preparer, accountant or CPA.

While this act also provides for several other spending provisions, the individual tax savings available will benefit almost all US taxpayers, making it more important than ever to review your tax situation and take advantage of the benefits of the Stimulus recovery provisions.

 

Floyd D. Saunders has 35 years of experience in the financial services industry. Floyd’s diverse background includes experience in retail banking, investment banking, insurance, investments, financial planning, and tax preparation. He has been an adjunct faculty member for St. Mary’s College, Moraga, California, and Community Colleges in California, teaching courses in managerial finance, money and banking, and principles of banking. He has also taught extensively for the American Institute of Banking and various banks.

Mr. Saunders’ professional experience includes assignments in the business lines of retail banking operations, investment banking, institutional trust and securities services, employee and management training, and systems engineering for banking, accounting, and tax preparation firms. He has worked for Bank of America, JP Morgan and JPMorgan Chase, and as a consultant in the financial services industry. He has prior experience as a registered representative and has published several articles on personal financial planning.

Mr. Saunders has authored four programs for the American Bankers Association, Banking on Mutual Funds and Annuities, Mutual Funds and Annuities, Introduction to Securities Markets and Investing in Securities.
Mr. Saunders earned a Master of Arts degree in Management from Central Michigan University and a Bachelor of Arts degree from San Diego State University.

“You have left it too late.” Thousands of people are hearing this every day and experiencing that sinking feeling when they realise something once so freely available, is now denied to them. People without savings or perhaps with less than 2 months wages in the bank (that’s the majority of people of working age) were able to buy Income Protection insurance very easily. This insurance policy provides a financial lifeline for them and their families if their income is interrupted by Unemployment, Accident or Sickness. Its seems almost overnight that people who were considered the best clients of insurance providers, typically banking and financial services, are now struggling to find cover. They have joined people in the building trades and estate agents who were in the first wave of occupations to fall victim of the credit crunch. We are now seeing the impact of the wider recession.

Take cover

For families and individuals with minimal savings, it will be vitally important for them to move quickly before their sector is the next to suffer the same fate. For many it is only a matter of time before either Mortgage Payment Protection Insurance or Income Protection Insurance is denied to them as well.

One in ten jobs in the UK rely on the retail. It does not take a genius to calculate that the retail sector will see significant contraction and job losses, particularly those handling big ticket items or discretionary purchases. Think in terms of the bad news already filtering through about a down turn in car sales, kitchens, and furniture. After all, most people can put off big purchases, especially as the property development frenzy of recent years peters out.

Engineering is another where shrinking order books see managers beginning to check their company redundancy terms. This may prove to be a precursor to one of many ‘difficult conversations’ with employees. Indeed, they may find they are soon to join their fellow ex-employees looking for alternative work.

For the majority of people in Britain, money for savings simply does not exist. Up until now this has not been a problem as jobs were plentiful. Unless signed off from work on a long term basis following an accident or due to sickness, being out of work was very temporary indeed. How long can people expect to be out of work as Britain falls into recession? Though everyone will have a different experience, any job search is guaranteed to be much harder than it was last year.

6 months to get another job

In the spring of 2008 a specialist consultant working with ManPower, who asked not to be named, was advising his white collar clients they should think in terms of 2 – 3 months between jobs. He is now saying think six months or more and this will just be for temporary contracts. The Telegraph (10.10.08) were reporting a contraction in full time posts in the UK with the number of temporary vacancies still holding up. The selection and interview process for any job is far more intense and time consuming than in the past. One thing is for sure, it is not going to get easier and the competition for the few full time jobs available will be very tough.

Financial meltdown can be avoided

Check out the Web to search on Income Protection or Lifestyle Protection (very popular alternative name that used by the Post Office for example). Money Supermarket has a buyers guide and price comparison. People who try on-line quotations and find they have issues with acceptance criteria due to their occupation may need to approach a specialist broker instead.

Just don’t leave it too late and be forced to join the increasing numbers facing financial melt down who have nothing to fall back if their wages stop rolling in.

i:Protect offers competitive Income Protection Insurance and Lifestyle Protection Insurance to protect your family, your home and your income.

For those interested in building a real estate investing institute of their own, social media is extremely useful since it allows you:

1)    To tell others about your current real estate investing projects.

Most sites allow you to post pictures and videos, and you can use this feature to highlight your current properties. This can be a nice supplement to the ads you already post.

2)    To market yourself and your real estate investing institute with personality.

Most ads and flyers look the same, but in social media you can let your personality shine through. Whether you have a love of antique properties or extensive knowledge of condos in your market, social media lets you talk about what you are interested in.

3)    Ask and answer real estate investing questions.

In environments such as LinkedIn, you can ask questions of other users or answer questions that have been posted. This lets you do several things: it lets you get answers and opinions for questions you have yourself and it lets you meet others while also building credibility.

4)    To potentially find power team members and JVs for more real estate investing.

Social media sites like this one, for example, attract lots of people – from contractors to lenders to buyers. If you are looking for power team members, social media is a nice non-threatening way to network and meet others.

5)    To expand your referrals real estate investing exponentially.

In most cases, you build your referral list one person at a time. You ask person A to recommend person B and person B maybe recommends you to persons C and D. Maybe. With social media, there isn’t this amount of work for just a few referrals. With LinkedIn, for example, each time someone recommends you, everyone in their network sees your recommendation. One recommendation can be seen by hundreds of people. If you have just a few recommendations you could build up quite a referral list.

Real estate investing is serious business, and social media allows you to gain referrals and new customers for that business.  This is a marketing strategy that should not be overlooked, and highly recommended to fold it into your marketing repertoire to build out your own real estate investing institute to dominate your investment competition to create a 6 figure bank account, and realize 7 figure gains in as little as 7 months, part time.

Brad WoznyBrad Wozny is a real estate investing expert. Let Brad show you how to connect with eager real estate investor buyers & sellers of INVESTMENT properties. Access private money & creative lending resources. Claim your FREE Strategic Investment Manifesto and Download your 2 FREE real estate investing mp3 case studies at http://www.InstantRealEstateSolutions.com

In this article, we will continue the financial investing series with the discussion of financial market structures known as debt and equity markets in macroeconomics.

I. Debt markets

Fund borrowers can utilize debt instruments like bonds, debentures or mortgages. These financial instruments are legal document that require the borrower to pay lender certain amount of interest payment until a maturity date. The maturity date is the date the bonds expire Interest is paid at stated intervals until the maturity date, whereupon the borrower repays the principal.

A debt instrument can be

a) Short termInstruments require one year or less for repayment

b) Medium termIt can be repaid between one and ten years.

c) Long term.

It is longer than ten years to repayment.

II. Equity markets

The equity market raises funds by the issue of shares that create ownership in the corporation. There are different types of equities markets

1. Primary markets:

Only sell new issues of a security. Brokerage houses act as intermediaries and underwrite the securities by guaranteeing the price by the corporation or government issuing them. Initial Public Offerings (IPOs) are usually pre-sold and not available to the public.

2. Secondary markets:Resell securities that have already issued through the primary market andthey are sold in open market without a price guarantee by stockbrokers and dealers.

3. Exchange and over-the-counter markets:this is the stock markets that arrange for buyers and sellers to interact in one physical location.

4. Over the counter markets (OTC markets):Dealers hold an inventory of securities that they sell over the counter to anyone willing to accept their prices.

III. Money Markets

Money markets trade securities with short maturity dates, usually of one year or less.

1. Government treasury bills (T-bills):

These are debt instruments purchased by corporations, other governments and consumers to finance federal government deficits.

2. Short term government bonds:

These are bonds that have a maturity date of less than three years and carry a fixed interest rate. They are equal in security to a T-Bill.

3. State and municipal short term notes and bonds:These carry interest rates that are determined by the credit rating of their issuer.

4. Banker acceptances:These are bank drafts issued by a firm. They have a stated maturity date, usually 30 to 90 days and can, for a fee, be guaranteed by a bank. They are also virtually risk free.

IV. Capital markets; Capital market instruments include the following:

1. Stocks:These are equity shares in a corporation.

2. Government bonds: These are long term debt instruments that have specific maturity dates, interest rate and are highly liquid.

3.Savings Bonds: These are sold directly to the consumer and always maintain their face value and may be cashed at any time.

4. State or provincial Bonds: These are issued by a state or provincial government.

5. Municipal Bonds: Issued by local governments and often used to finance specific projects.

6. Corporate Bonds: These are used to finance short or long term activities. They have a lower credit rating than government bonds, hence a higher interest rate.

7. Warrants: Warrants are certificates that give an individual the option to buy a stated number of shares at a specified price for a specified period of time.

V. Foreign exchange market

In the foreign exchange market, currency is bought and sold.

I hope this information will help.If you want more information of the above subject, you can find this series of articles at my home page:

http://lifeanddisabitityinsuranceunderwriter.blogspot.com/

http://financialinvesting05.blogspot.com/

http://financialinvesting06.blogspot.com/

All rights reserved. Any reproducing of this article must have all the links intact.
I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990

If you have a pre-existing condition that carries high risks for your insurance company, you may have trouble finding an affordable health plan. In fact, companies are not forced to insure you. If you are too risky, they can reject your application.

More than half of all insured people get their insurance from their companies. Group insurance plans reduce risk by sharing the cost equally. But, what if you can’t get into a group plan?

States offer a type of health plan called “risk pools.” Risk pools are intended to provide insurance to the uninsurable.

What Is A Risk Pool?

First, let’s look at how group insurance works. Even risky individuals can be covered under group health insurance at little cost to insurance companies because everyone shares expenses and risks. When the company has to shell out extra for claims made by a certain individual, the rate of the whole group goes up.

With individual health plans, there is no group. It’s just you. So, private insurance companies look at your medical history and risks. This is what determines your rate.

A risk pool is like a group of all the people within a certain state who can’t get private insurance because of pre-existing conditions and other health risks. It works in much the same way as group insurance does, except that the group in this case is not the company, but all the individuals in the state who can’t get insured.

Because they are obviously risky, risk pools cost more than regular insurance. This is not a government support program like Medicare or Medicaid aimed at low-income earners. Risk pools are usually quite expensive.

Does My State Have A Risk Pool?

Not every state offers risk pools, but most do. There are risk pools in Alabama, Alaska, Arkansas, California, Connecticut, Colorado, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, North Dakota, Oregon, South Dakota, Tennessee, Texas, Utah, Washington, Wisconsin, West Virginia and Wyoming.

Each state’s risk pool varies. You definitely have to be a resident of the state in which you apply. Other than that, the requirements are different in each state. In order to qualify, they may require that you prove that you’ve been rejected by an insurance provider because of a high health risk.

In most states, you can’t get a risk pool health plan if you qualify for Medicare or Medicaid. Some states also have an enrollment cap, meaning that they will only accept a certain number of applicants to the program each year.

Risk pools are operated by non-profit healthcare organizations. Currently, almost 200,000 people are enrolled in risk pools, which is not a large number if you consider how many Americans are uninsured. Some states, like Tennessee, are starting to have special programs for kids and specific diseases like diabetes.

Risk pools are convenient for individuals who are having trouble getting insured. You can take out a short-term plan to cover a gap in your employment or insurance.

If you have a pre-existing condition that puts you at high risk, you may feel like you should stick with your group plan so that you can stay covered. This might mean staying at a lousy job that you would just as soon ditch otherwise. Risk pools offer you more choices for your health insurance coverage.

You can also find more info on Long Term Health Insurance and Short Term Health Insurance.