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The Weekend: Saturday
& Sunday, January 25 & 26, 2003:
Have you ever
wondered how the folks at Consumer Credit Counseling Service are
paid? What sort of success rate do they have for their
debt-laden clients? They are without a doubt, the
best known non-profit debt counseling service on the planet! And
with the economy the way it is, combined with the unbridled greed
of the credit card and banking industries, the debt counseling
business (overall) is huge. But CCCS is facing some stiff
competition; lots of upstart debt counseling companies-non-profit
or not-are pressuring the "voluntary" commissions paid
to CCCS and others in the business.
CCCS-Los Angeles president Peter
Lake answered some tough questions on the air during my KFI-Los
Angeles radio show on January 19, 2003, but within a few
minutes...figured out that someone on his CCCS
team dropped the ball and didn't do their homework. If they'd
spent 30 seconds on this website and searched for previous
Dover-authored articles about CCCS, Mr. Lake would have never
come on the show. Here's a little taste of what you
missed.....
Why does CCCS pound the fact that
they're a non-profit organization? Dover's Reality: Because
the vast majority of consumers don't have a clue about what
non-profit really means. Bottom line? Non-profits do make
money...they just distribute what would normally be returned to
shareholders as dividends and pay it out to employees or
officers as bonuses. They make money, kids...they're not
charities-they're spin-masters that play on your lack of savvy.
How is CCCS paid?
If you wanna read their spin and side-stepping explanation, read
the answer they've posted on their website
here. Dover's
Reality? These
"voluntary contributions" that CCCS receives are also
known as commissions. The fee received by CCCS amounts to a
commission for collection services-which in my book makes them a
debt collector. Let's see...they're being paid by your creditors
to "work out" a repayment plan that's supposedly in
your best interest. You believe that? You're a fool if you do! I
promise you their loyalties are with the people paying
them...not with the beaten-down-and-buried-in-debt consumer who
naively seeks their counsel.
"Our average DMP [Debt
Management Plan] can take up to 40 months..."
said Mr. Lake. Really? Not according to one DMP I have in my
hands. The [former] client of CCCS-Los Angeles is now filing for
bankruptcy...something she should have done a year ago, instead
of trusting CCCS. Here's the scoop:
- She's a 74 year old senior citizen and owns
nothing. She rents an apartment, works part-time to make extra
cash to pay bills and takes home a net of $740 a month, plus
whatever meager Social Security benefits she's eligible to
receive.
- She signed up with CCCS-LA a year ago and
has never missed her $229 a month payment; she enlisted their
help to repay two credit cards: $2,404 to Capitol One and $6,666
to Providian.
- In one year she has paid $1,008 on the
Capitol One credit card...and the original balance has been
reduced to $2,057...out of $1,008 in payments the balance has
gone down only $347.
- You'll love the wonderful progress they've
made on the Providian card: She's made $2,005 worth of payments
and her balance has gone UP from its original $6,666 to $6,929!
She now owes $263 more than when she signed up with CCCS-Los
Angeles!!!
To recap: This
woman is 74 years old and at the current amortization rate,
she'll be finished paying off these two credit cards when she's
the ripe old age of 154 years old. That's right: Instead of the
40 month DMP touted by Peter Lake, this poor woman's current
payout plan will take 80 years. She's paying an estimated 53%
APR...out of $229 only $9.33 is going to principal and the rest
to interest and "fees." Refresh my memory one more
time: She signed up with CCCS to pay off her debts and after
they did a personal evaluation, this was the best they could
come up with?
What ever happened to the CCCS
nationwide promise of negotiating with creditors and using the
stellar reputation and leverage of CCCS to get creditors to
reduce or waive finance charges? You first need
to read their spin on this huge part of their sales pitch as
posted on their website. [Go
read it now!!!] Okay... you
tell me: Does it look like CCCS is delivering on their
promise in this horrible example I just laid out for you?
Ben's CCCS-Bottom Line:
Should you repay your debts? Absolutely...but remember that the
bankruptcy laws are there for a reason. I don't care how or why
someone's gotten themselves into financial trouble-that's not
the issue right now. Getting people on the right track is what's
important...if re-negotiated repayment plans are the answer,
then do it! But it's becoming increasingly obvious that more
consumers should take a serious look at pulling the ripcord by
invoking their rights under federal [and state] bankruptcy laws.
This woman's example should serve as a confirmation of what I've
been preaching: If the creditors won't play ball and renegotiate
the repayment schedule, then tough luck. See ya in court.
Don't drill me about encouraging
consumers to be irresponsible: It takes two to
make a credit transaction! Why do these credit card
companies continue to extend unsecured credit to consumers that
obviously can't handle this type of debt? Greed.
Pure and simple. If they don't issue the credit cards, the
people can't run 'em up. The "sword of responsibility"
cuts both ways, kids.
Wanna fire those
bottom-feeding, tele-terrorist debt collectors?
Looking for the Cease & Desist Letter you heard discussed on
the air? Look
no further...and relax. You're
gonna be fine.....
Didja know that
you're probably your own worst enemy? At least
when it comes to the world of identity theft...You're probably
making yourself a much bigger-and easier-target for the bad guys.
I hate to have to keep writing about this topic, but the
increasing frequency of national news stories should be a pretty
good indicator of how serious a threat and widespread an epidemic
it's become.
- If you have your mail
delivered to your home or apartment or condo, it's just a matter
of time before you're a victim of mail theft, which is only a
heartbeat away from identity theft.
- Law enforcement officials
say mailbox break-ins, primarily at apartment and condominium
complexes, are largely to blame for a huge increase in
identity-theft complaints in 2002.
- Thieves get quicker
results at apartment complexes, where breaking one lock can give
them access to as many as 20 mailboxes. Private residences are
also targeted, but it's primarily apartments because of the total
number of mailboxes you can access in one location.
Make
yourself less of a target!
1.
Don't leave your outgoing mail in or on your mailbox awaiting
pick-up by the mail carrier. Use a traditional drop-off mailbox or
personally hand-off your mail to the carrier.
2.
Leaving it out in the open is an invitation to the bad guys to
help themselves...especially those traditional mailboxes with the
flags that signal to the carrier there's mail to be picked up. The
thieves have kinda picked-up on this clever signal.
3.
If you're going to have your mail delivered at home, make sure
you've got a U.S. Postal Service-approved locking mailbox or a
mail slot. Especially if your mailbox is located on the street for
curbside delivery, get a Post Office approved lock on it. Your box
is on your front porch you say? Same drill applies.
4.
If you have your mail delivered to your home, don't allow the bank
to mail new checks to your home address. Tell them you want to
pick your checks up from the most convenient branch and they
should play ball and allow you to do this. The thieves love to
steal checks because they know that they can convert them into
merchandise by writing a few dozen hot checks on your account for
a week before you (or your bank) have any clue that you've been
hit.
Since we're
discussing checks...let's talk about what you put
on the front of your checks while I've got your attention, shall
we? What's the bare-minimum amount of information you need to have
on the front of your checks? Two
clichés come to mind: "Loose lips sink
ships" and "Less
is more."
- I'm still amazed at the
number of consumers that practically print their life histories on
the front of their personal checks. According to several
retail/consumer banking experts, all you need to have on a check
is the routing information (encoded along the bottom of the check)
in addition to the usual blanks for the "Payee" name,
amounts and signature. But since few retailers would readily
accept such a minimalist check, only the bare essential
information needs to be on the face of your checks.
- Name: Follow the "less is more rule."
Instead of Benjamin F. Dover, I'd put B.F. Dover on mine. Instead
of a street address, I'd use my P.O. Box address.
-
Don't have a mailing address that's different from your residence
address? Then at the very least, please tell me
you've got a mail slot that allows the mail to be delivered into
the home and not sit in the box, just waiting for the thieves to
help themselves to.
-
No mail slot? Then buy a U.S. Post Office-approved
"locking" mailbox. Remove temptation and lower your
chances of becoming a victim of identity theft.
- You don't need to print your telephone number on the front of
your checks, either: If they need it, let 'em ask
you for it, and they can write it down. Don't print
"His" and "Hers" driver's license numbers on
your checks, either. (Same principle applies.)
-
And I wish the consumer banking industry would refuse to allow
consumers to shoot themselves in the foot: Every
time they allow unwitting consumers to print their Social Security
Number on the front of their checks, it's another identity theft
nightmare just waiting to happen. (Believe it or not, this still
occurs with great regularity!)
If you've
purchased any CDs in the last few years, I've
gotta way for you to make a few bucks with no strings attached!
The music industry said they weren't guilty of price-fixing, but
because they're so gosh-darned generous, they decided to spend
over $125 million in cash, CDs and legal fees. Read
all about it
and then click
here to see how you can get your check!
Just got an
e-mail from someone who wants to know what to do:
"I just got a letter from Providian telling me that
they checked my credit report and have decided to cancel
my credit card! Can they legally do this?" If it hasn't
happened to you (yet), it might in the months ahead. What
can you do?
Ben's
Bottom Line:
-
Check your credit reports at least once a year to make sure the
information being reported about you is hopefully flattering but
at the very least, accurate.
- Be
aware that if you're having problems with any of your creditors,
or you've been loading up on debt, this is all the excuse and
reason many credit card companies need to jack up your interest
rates, even if you're current and within your credit limits with
them!
By the way:
The best way to get outta the trap with these loan sharks? Pay off
the cards and close the accounts ASAP. If you've gotta home,
you'll really wanna think about pulling out some equity and paying
off the cards with a tax-deductible loan. If you want some
terrific information on home mortgages (or any part of the home
buying process) you'll wanna check
out the free 2003 Home Buyer's Guide, just released last week.
Is the IRS legal?
According to an e-mail from (listener) Jeffrey: "Dear
Ben: I've been hearing for many years now that the IRS is illegal
and that the entire system of income taxation is unconstitutional.
I've done some extensive research and want you to check out this
website and tell me what you think. There's no law that requires
us to file income tax returns, pay income taxes or have any taxes
withheld from our paychecks. The lawyers have even proven this to
be the truth!!! Check it out for yourself..."
There's a slew of sites out there touting this
point of view, all of them use the same strategy: Quoting excerpts
from the Constitution out of context to try to make their points,
and then they fan the "us vs. them" flames of
discontent. After they've successfully whipped you into an
anti-government frenzy, they'll hit you with a hefty fee to
either:
-
Join their "association"
- Go
to their seminars
-
Buy their books
-
Buy their tapes...
...or some combination thereof. Ben's
Tax Protestor Bottom Line? If you're okay with
stashing all of your cash in a mattress in your quest to
"live off the Big Government Radar" the rest of your
life out in the middle of nowhere, then go for it! But rest
assured that the IRS isn't gonna jack around with you. Anytime you
start believing some of the legal "experts" that want to
go mano-y-mano with the IRS in a debate, you're following a
dangerous course of logic.
Speaking of the
IRS, some of you need help cutting deals with the world's most
powerful debt collection agency: Enrolled Agents
have been around since the Civil War and, along with attorneys and
CPAs, are authorized/empowered to represent you in front of the
IRS. Many Enrolled Agents are former IRS Agents and know the
lay of the land and will do a great job for you for an extremely
reasonable fee. Click here
to read more about them and dealing with the IRS...
I may have
stumbled across a little technique your creditors may
inadvertently be benefiting from that could be setting you up for
late charges! I love how smart you guys
are...here's an e-mail that proves it, and may save you some
money on late fees for the rest of your life! "Just
a heads up, Ben: I'm in the printing business, and suggest your
readers/listeners/viewers pay special attention to how their
credit card payment coupon is SUPPOSED to line up with the address
window in the return envelope. Many times, the envelope is made
incorrectly or the statement coupon is sized wrong. Either way,
the return address is partially hidden, causing delays in getting
the payment posted. Result? Late fees! I suggest ignoring their
instructions to not staple through the check and the envelope.
That way, the address is sure to stay visible. So what if it
causes "extra work" on the part of the credit card
posting department. If they want their money, let them do the
extra work. This happened on a couple of major credit card company
bills recently...and they're not alone. Keep up the great work.
Sincerely, Greg N. in Dallas"
Ben's Billing Bottom
Line?
Dilemma: You know the
return portions of your credit card billing statements always tell
you to not staple the envelope. I know all about their automated
sorting equipment that opens our envelopes containing checks and
payment coupons. But the Post Office has automated sorting
equipment too...and if the return coupon doesn't line up through
the little window in the envelope properly, your payment gets
there late. And they get to pop you with another late fee!
Solution?
I'd never encourage you to staple their precious
envelopes, but you might wanna make sure before you seal
the envelope that the entire address is clearly visible through
the window. If it's not? A little piece of tape will
help keep it in place...or a staple if you're one of those
thrill-seeking types that likes to really push the
"envelope" [no pun intended] in life. (You know
who you are: You're the wild ones who run around the house with
scissors..or drink milk that's a day-or-two past its expiration
date.)
Here's another way your bank is
setting you up for failure...while setting themselves up for
bigger profits! According to a recent story in The
New York Times: "At least 1,000 banks
are encouraging customers with low balances to overdraw their
checking accounts, allowing the banks to skirt credit laws and
collect billions of dollars in new fees.
The banks' programs cover checks that would
otherwise bounce and even allow people to overdraw their accounts
with ATM and debit cards. The fees are paid disproportionately by
low- and moderate-income people, according to industry consultants
who help banks create and market the programs. One consultant
advises banks to maximize the fees by opening branches "in
supermarkets, particularly supermarkets with a middle to down
market and a family target market."
Banks say that they are offering a service
that enables people to avoid paying bounced-check fees to
retailers. But many inside and outside the banking business say
the programs, while extremely profitable for the banks, are a bad
deal for consumers and amount to high-interest loans.
The move to encourage overdrafts is a major
shift. In the past, when consumer groups complained that
bounced-check fees were excessive, banks generally responded that
high fees encouraged people to use their checking accounts
responsibly. Now, with banks increasingly dependent on fees from
consumers, overdrafts have become a source of profit."
Ben's Check Bouncing Bottom
Line?
1. If you don't balance your
checkbook, you will end up padding the bank's bottom line...they
are going to get you one way or the other.
2. Should the banks to be
faulted for wanting to find ways to be profitable? Of course
not...but their tactics encourage consumers to make stupid and
potentially expensive financial mistakes are suspect, at best.
3. Less than 25% of the
nation's checkbook carrying populace balances their account every
month: You snooze...you lose! If you don't balance your checkbook,
you're asking for trouble and setting yourself up for disaster.
Should the bank make a mistake and you fail to catch it within 60
days of your statement date, you're screwed. Period. End of
discussion. Buh-bye! Wanna
read more about it?
Do you know how
to avoid getting short-changed by your insurance company? A
large portion of the nation is shivering in
below-freezing temperatures this weekend...which sets the stage
for many of you about to be forced to deal with your
insurance company for claims ranging from busted water pipes (and
the damage that goes with it) to car accidents and the heartburn
that comes from making new friends at the auto body shop...or ER.
Ron
Alford's website is a terrific, pro-consumer resource that
will help you beat the insurance companies at their own game,
whether it be homeowners, renters or automobile insurance.
Remember: Their adjusters are paid to say no! Insurance companies
love to take your premiums but hate to pay claims. Claims are
their biggest threat to their profitability...and fraudulent
claims have created an atmosphere of distrust that they shouldn't
be blamed for having.
However, their
bottom line is directly affected by the amount of cash they have
to pay out for claims, fraudulent or not.
Their reality? This is an industry that's trained to say no...or
short-change consumers what they're rightfully owed when they've
suffered a legitimate loss.
Consumer's Rule
1: You've got to fully understand that insurance
is seriously different than any other product or service. To be
able to "win" a settlement, you must first lose! What's
worse is that when you have lost, you have lost the use of your
car, your home, or your business. Under these circumstances, you
also lose your ability to think and function as a normal person,
which gives you a larger handicap-in addition to not knowing the
claim game, the rules or how it is played.
Consumer's Rule
2: The insurance adjusters have more experience
than you do! The sellers of insurance have been practicing their
game for over 260 years and invested billions of worker-hours
honing their skills. They created the policies they sell and
they're the ones who have controlled most of your knowledge about
the insurance game. Remember, they're the ones that sold you on
trusting them to give you the rules.
Consumer's Rule
3: If you don't manage your insurance, your
insurance will manage you. Take time to understand risk and how to
deal with it. Simply buying an insurance policy without
understanding how to collect the money from the company is not in
your best interest. The time you invest to learn will make you as
smart as the sellers, which is what you need to be if you want to
be on a level playing field. Take the time to know every rule.
And speaking of
broken-pipes and water-related damage claims: I've
got a terrific section here on the my website that will give you
some unique insight into the big database that's keeping track of
homeowners (and renter's) insurance claims. It's called C.L.U.E....and
you'd better have a clue about any property you're thinking about
buying before you put any money at risk. Read
all about it here...
Ben's
Insurance-Related Bottom Line? It's a game you're
going to lose if you don't know how to play it. Understanding how
they work before you're under stress can make all the difference.
You're gonna love
the latest story about a company that got popped for another one
of those "sounds too good to be true" promises
that turned out...you guessed it! Too good to be true!
Lose weight while you sleep? Sure...it's easy to take a few ounces
of paper out of your wallet, 'ya dopes! Read
more about it...
Would you undress
or shower in front of a camera in plain view? You
might want to start treating cell phones with the same level of
respect! You're not gonna believe why you could find yourself
having your Cell Phone confiscated in locker rooms, bathrooms or
secure areas around the world. Say
cheese and read more about it.....
Now there's yet
another way for the bad guys to steal your identity:
It surfaced this week in
a recent USA Today cover story worth reviewing, and
really hammers home how much all of us are at risk. Ben's
Bottom Line? Unless and until we force lawmakers
to get off their butts and pass extremely aggressive and punitive
laws, combined with giving law enforcement plenty of dough to
pursue and catch the bad guys, we're never going to win this
battle. Severe penalties
must include long stretches of jail time for everyone even
remotely involved/convicted.
Justice is blind, but this latest
ruling from a federal judge proves that at the very least, it's
not deaf, dumb or obese-between-the-ears: Plaintiff's
attorneys that engage in litigation lotto should
be forced to pay the defendant's legal fees and court costs when
silly cases like this one are thrown out-read all about it
here.....
Could you be
sleeping with the enemy? With Valentine's Day
coming up soon, it seems timely to discuss the darker side of
love. Here's the inside scoop from Houston-based Private
Investigator Ed Pankau on
"How To Catch A Cheating Spouse [or significant other]":
Come home a
little earlier than expected: Then hit the re-dial
button on all the phones. You may not be the only one surprised by
who answers the other end of the phone.
Does your
significant other have a cell phone? The same
re-dial feature comes in handy here, too.
Cell Phones, Part
II: Most of them have a history of the last 10
phone calls dialed. Hmmmm...might be worth reviewing sometime when
the other person's in the shower or indisposed.....
Cell Phones/Part
III: Does your spouse have one? Why not? Don't you
care about their safety? Then get 'em one...then make sure you
have the bills [or copies of the bills] sent to you so you can
peruse the "calls made" list. Make sure you specify with
the cell phone company that you want a bill that includes a detail
of all incoming/outgoing calls.
Also worth
noting when you get a look at the phone bill?
Check to see who receives the first call they make (when they
leave for the day), and the last call they make before arriving
home.
Does your
spouse/significant other travel? After they leave
their hotel, call the front desk/business office/cashier a few
hours later, and tell them you're the assistant for [name of
target] and that they either didn't get/don't have/lost their
bill/receipt [pick one]. "Could you please fax a copy to
our office? Here's our fax number..." They'll never be
suspicious you'll have a chance to inspect the charges
incurred. You might be surprised at the amount of information on a
hotel bill [especially if the target has an expense account]: Room
service, in-room movies, mini-bar and [drum roll, please] a detail
of the phone numbers called. (Have fun...!)
Hmmmmm, new
underwear? Scents and style are always two big
warning flags that something's going on. She's wearing new
perfume? He's wearing new after shave? New boxers [if they wore
briefs]? New briefs [if they wore boxers]? New thigh-highs?
Garters? Underwear? Lacy bras? Bustiers? New romance almost always
triggers new purchases in these areas. Believe it.
Spending hours on
end surfing the Internet? If your
spouse/significant other is practically obsessive-compulsive about
checking their e-mail, there's probably more than just business
e-mails they're looking for. There's software out there that
monitors kids on-line activities...it works just as well to
monitor older-kids on-line time. Spector Pro automatically records
everything your spouse, children or employees do on-line. Features
include stealth e-mail monitoring, chat and instant message
recording, complete keystroke logging and more. Check it out and
then check them out: www.spectorsoft.com
Wanna get a copy
of a phone bill? A credit card statement? Run a license plate?
Get some background on someone...perhaps outside of conventional
channels? Then you need to find an information broker.
Don't ask/don't tell: They name a price,
you pay...they get you what you need.
Illegal? Perish the thought. Effective in the
world of personal intelligence? Play
to win kids. Wanna know where to
find an information broker? Check
out my one-stop shop for the intelligence community...
Skip the Rockford
Files re-enactment...learn how to analyze their handwriting
instead! Bart Baggett's the founder of www.handwritinguniversity.com
and one of the best handwriting analysts around. He's got all
sorts of free stuff on his website [of course he's setting you up
to spend some dough...but it's reasonably-priced and if you don't
like it, you'll get your money back]. There's more science at work
than might appear...click
here and get the free e-book Bart offered on the show.
The Weekend: Saturday
& Sunday, January 18 & 19, 2003:
From the "Pete Townshend
shoulda spent more time listening to this show"
Department: Here's something everyone listening right now can
learn from him....what Pete and a fellow pervert down in Florida
wished they'd know before the police popped 'em for possession of
child pornography: That's
right...here's a lesson all of us can learn: Take
a look at this story about this pervert in Florida...
Ben's important lessons for everyone that can be learned
from this mess: Aside from seeking psychological
counseling for having an appetite or interest in child porn, the
real mainstream payoff should be obvious:
1. Just because you throw something away... taking your
trash out to the dumpster or putting it out on the street for
collection doesn't get you off the hook. If someone comes across
something that's trace-able back to you and reflects illegal
activity, you're dead meat!
2. Expect that anything you throw away could end up in front of
your boss... or your neighbors, your spouse or significant
other, or the police,
a judge
or a jury. And of course...it'll end up in the media if it's juicy
enough.
3. Of course you always need to shred anything with your name and
address on it: Even if it's as mundane as a catalog...shred
it!
4. Many of you have taken my advice and have begun using mail
drops or gotten a mail box from the Post Office. Don't be
lulled into a false sense of security on that front, either! Never
throw "junk mail" away at a facility like these. Remember:
Trash receptacles are open game and anyone can sift through these
and take whatever you've left. Catalogs, solicitations, you name
it....don't throw anything with your name on it, away! Shred 'em!
Burn 'em! But don't just toss 'em!
5. Any computer media (like the diskettes that got this former
child porn collector into hot water) must be properly erased or
better yet, burned or shredded! "Running a
magnet" over a diskette (like the dope in Florida did) simply
isn't good enough. If there's something critical, really private or
even criminal on a diskette, you need to use one of those bulk
erasers, like we've used in radio for years. Bulk erasers are big
electromagnets that really put out some juice and are designed to
thoroughly erase magnetic media. If you've got diskettes or
videotapes [attention Pamela
and Tommy Lee or other amateur home movie
producers] that you wouldn't want to be embarrassed by if they fell
into enemy hands, go
drop $40 on a bulk eraser at Radio Shack.
My advice? Be safe: Erase all used computer or
video/tape recording media, and then burn it. You really can't be
too careful!!!
6. Other computer media that can get you into trouble? CDs!
You'll never be able to erase a CD that's been "burned"
during the creation process. Get out a pair of heavy-duty scissors
and cut the CD up...and then burn it!
7. Speaking of shredders, spend the dough and buy yourself a good
one: All of the office supply places (like Office Max,
Office Depot, Staples, etc. or warehouse stores like Sam's or Costco
have 'em. Spend the extra money and buy a shredder that cross-cuts,
not strip cuts. Cross-cutting shredders will be more expensive, but
are worth the extra cash; many of the models available now have
built-in credit card shredding features that are terrific! Expired
or unwanted credit cards or ID cards can be pulverized into plastic
confetti in seconds. It's far more efficient that a pair of scissors
and makes it virtually impossible to piece back together the card.
I
bought my Aurora Cross Cut shredder at Staples...they've
always got rebate deals on these [I got $40 back when I bought mine
last summer] making the "net" price I paid under $80. The
same shredder's available on their website for (a net of rebate
price) of just under $60...so go buy one!
E-Filing or Free
Filing? Your pals at the IRS want to help yourself this tax
year: Sure, it sounds charitable enough...file
on-line for free...get your refund faster...save everyone a bunch of
dough. Why not give it a shot? Here's
the link you're looking for.....
Can you imagine what having a name like Charles
Manson, Jr. or Ted
Bundy, Jr. or Adolph
Hitler, Jr. would be
like?!? If you (or someone you know) is expecting a child,
I'll tell you why you (they) are absolutely nuts if you make that
kid a "junior," but first...take
a moment to read the story of Jamie Rodriguez.
Ben's Baby-Naming Bottom Line?
1. Naming a child after a father can
be a double-edged sword 20 years down the road. Dad never
knows how that sweet little baby's gonna grow up, and Junior never
knows what sorta financial brain damage Dad's gonna get himself
into. Do yourself a favor...check your ego at the door and don't
name the kid after the father. Depending on who self-destructs
first, it could be a source of problems forever.
2. Common names are bad enough when it
comes to credit and especially collections information confusion...but
throw in a Jr. or "III" at the same address and you're
asking for trouble. Let the kid have his own identity...no Juniors
or IIs, IIIs of IVs.
A guy called to ask if I
knew where he could go to compare credit card offers on-line:
Piece of cake...the best reference site to hit the Internet since Al Gore
invented it? Bookmark and browse it for yourself: www.cardtrak.com
Even if you do read the "fine print," what you end up
depositing in your bank account may not be what you thought it was!
Just because a major bank promises to charge you a certain interest
rate doesn't mean that they'll really follow through on their
promise: As crazy as it sounds, sometimes the biggest
banks are playing the biggest financial games. The nation's fifth
largest bank has their butt in the proverbial crack thanks to some
unsolicited "instant loan" checks they mailed out
recently. Read
more about it here...
Ben's [BLANK CHECK IN THE
MAIL/INSTANT LOAN] Bottom Line?
1. Every "instant loan"
offer you receive in the mail should be highly suspect:
No matter what the lender says, you can bet that any loan you agree
to through this method is going to be expensive.
2. Remember, you don't have to sign a "traditional"
loan agreement to paint yourself into the traditional corner of debt
hell, anymore: These "instant cash" advances in
the form of ready-to-deposit checks are just as effective when it
comes to making your (financial) life miserable.
3. Anytime you receive any sort of "check" in the mail,
even if it's "drawn" on one of your credit card lines of
credit...shred it immediately: Or burn it. Never just
throw them away, and never think that just because you tore it up
that the "threat" is now gone. The bad guys know what to
look for and are industrious enough to piece the check back together
in order to read the name and bank routing information, enabling
them to go print their own and make your life even more
miserable in 2003!
Do you know who to complain to if you lose your luggage the next
time you fly? Believe it or not, the rules have changed and it's not
for the better: The TSA is expecting to have a
"luggage policy" in place by the end of the year...but
that's not gonna do any of us much good right now:
1. Under current federal law, airlines are required to reimburse
passengers up to $2,500 for lost or damaged luggage: If
you need more coverage, you'll need to buy additional insurance. The
airlines are getting edgy about this because they're worried about
getting stuck with bills for luggage that was lost or stolen and
wasn't even in their control!
2. If your luggage has been
lost or is missing, you'll need to file TWO complaints:
One with your airline and the other with the Transportation Safety
Administration's Customer Response Center. The TSA's Response
Center/Customer Service number is: (866)
289-9673
3. Sometime in the next coupla weeks, the TSA will begin offering
luggage "seals" to passengers: If a bag has to
be opened, screeners can "snip" the seal and replace it
with a different colored seal so passengers will know their luggage
has been opened. TSA security personnel will supposedly place a note
inside your bag letting you know that it's been searched; they're
also talking about placing a sticker on the outside of the bag as
well.
Your wake up and smell the coffee reminder?
[Especially now!!!] Don't pack anything valuable in your checked
luggage. No electronics, no jewelry, no medications...nothing! Read
more from the TSA's website here...
The credit card companies and banks have spent over $800 million
trying to get the bankruptcy laws changed. With a new Congress back
in session, should you be preparing to pull the ripcord in the next
few months? San Diego bankruptcy attorney John Colwell
gave us an update on the outlook for the changing bankruptcy law
landscape. Click
here for the latest summary/progress report on bankruptcy reform...
Here's Ben's Top 5 Traps that are set and waiting for you to step
into in 2003: From creditors and credit bureaus to car
dealers and insurance companies, it's a mine-field loaded with
consumer nightmares that you can avoid:
1. Your credit card company loves to move the goalposts:
Assume nothing when dealing with them! These clowns are praying that
you stub your toe:
a. They'll watch your credit scores and the minute
they think you've become "a higher risk" because you may
be carrying a higher debt load-or you are victimized by erroneous
information or identity theft on your credit report-prepare to see
them jack up your interest rate. You don't have to have "done
anything wrong" on your account. In fact, you could be on time
and under your credit limit, but in most cases it simply doesn't
matter. Every month you must check the fine print at the bottom of
your statement to make sure you're paying whatever interest rate you
signed up (or thought you signed up) for.
b. Changing your due date: They'll unilaterally move
your date "up," reducing the number of "float"
or "grace period" days without any fanfare. Why? Because
they want you to mail your payment late; late payments = late
payment charges/credit card company profits...so be careful. Every
month: Examine your due date and give yourself at least 7 business
days to get your payment there by mail. Paying on line? Pay at least
three business days prior to the due date. Don't give them a chance
to slap you.
2. Old credit card debts: Be careful for the newest
trick that promises to gain momentum in 2003! If you get a
pre-approved credit card offer, read the fine print closely! This
year's favorite new tricks?
a. Suppose you had a Visa card that you defaulted on 5
years ago; you owed them $3,000 and never paid. Now you get an offer
in the mail for a brand new credit card with a $5,000 limit...and
it's pre-approved...no strings!!! Just sign here and
it's yours...and you do.
b. You get your new credit card in the mail a few
weeks later, but it's not what you were expecting, because you
obviously didn't read (or understand) the fine print. The offer you
just bit on came from the same bank you stiffed 5 years ago. Since
they knew they were outside the "collectability" statute
of limitations, making them unable to collect the old balance from
you, they offered you a new line of credit, with one not-so-little
string attached:
The old balance-with accrued interest and assorted fees-has now
been charged to your new credit card. By the time it's over, that
old $3000 debt is now worth $5,500...and your bank was more than
happy to take the old balance and charge it to your new credit card!
Oops! That $5000 limit is now shot to hell because you've got a
brand new $5500 debt and (so sorry to inform you of this) but you're
over your limit by $500! Now the interest and over-limit fees really
start to stack up...and you're up the creek.
c. Credit guard insurance: You lose your job? We'll
pay off on your credit card balance! Really? Not so
fast...
- The guidelines are usually so onerous, by the time they really
do begin to pay off, it's at least 90 days down the road and your
credit scores are shot by then if you haven't been paying them.
- Define unemployed! Define disabled!! Define [fill in the blank]!!!
Once again their sales pitch sounds good, but their willingness to
pay off when you need it most is like pulling teeth and the
resulting experience? Horrific at best.
3. Credit bureaus: Ohmygod! Identity theft has reached
epidemic proportions! You'd better sign up for:
a. Our credit watch services for only $79.95 a year.
That way, you'll be the "second" to know [the credit
bureau will always be the first] that there's negative garbage
surfacing on your credit report. Don't waste your money on
this...pull your credit report a couple of times a year for $8-$12
from each credit bureau and scrutinize the "Inquiries"
section. And if you've been turned down for credit, insurance,
housing or a job because of your credit, you'll get a free copy of
your report, a right guaranteed by federal law.
b. Identity theft insurance! We'll "pay off"
and provide you with compensation if someone clones your ID. The
jury's out on this insurance...too new to rate...but I'm skeptical
because it sounds too good to be true. Skip it.
4. We'll protect you from the IRS! We'll go back and
audit your tax returns from the last 3 years and get you a ton of
money-your money-back into your pocket! We'll represent you if you
ever get audited by the IRS!
These
companies bait you with all sorts of promises, free books on tape
is one of their favorite hooks, and then they
get you on the phone and brow-beat you into buying one of their
programs. Plan on spending $2,000 or more...for a bunch of hype. And
why do these companies always seem to locate in Las Vegas, anyway? I
wouldn't touch these clowns, period. Altogether now: "If it
sounds too good to be true....."
5. Car deals: Just spend an extra $18 a month for an
Extended Service Warranty (ESW) on that wonderful car you're about
to buy and you'll be protected! Sure you will...
a. Do the math: That $18 (or
more, per month), by the time you tack on interest, could end up
costing you thousands over the term of the contract.
b. Extended Warranty Contracts (ESWs)
usually only kick in and pay off after the factory warranty expires:
So if you trade out of your cars before they're paid off and before
the factory warranty expires (especially relevant for those of you
that lease your vehicles) this is gonna be a waste of cash. The car
dealers love to sell 'em because they make some fat commissions on
them!
c. Good luck getting them to pay off:
If you use-or your mechanic uses-just one wrong term or buzzword,
you could be toast. For example: If they mention a rubber boot
around a defective shock absorber worn out, this off-hand remark
could cost you your ability to collect on what can be a major
repair...and end up in that vehicle's "permanent file"
forever, making future claims impossible.
Why? Because ESWs frequently (and intentionally)
exempt rubber products. The minute they hear that something's broken
and there's a rubber-related element to the potential claim, you're
toast. Bottom line? They're
always gonna do their best to not pay off on your claims. Beat 'em
to the punch: Either don't buy one of these ESWs or make sure you've
got a bright mechanic on your side who'll properly phrase any
pre-authorization discussions or correspondence with the company in
your favor.
United Airlines is doing some things they hope
will entice you to fly their friendly skies...and it could earn you
free tickets a lot faster...but there's a catch. (There's always
a catch!): Please remove all of the metal objects from
your pockets and read
all about it here...
Ben's Bottom line "insider secret" on airline deals?
If it's a "real deal," something worthwhile like a
double-miles offer, then you should see their competitors quickly
match it. If the competition ignores a "deal?" Then it's
really not a deal!
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