April 2010 Archives

President Obama has had it with Wall Street's shaky (and often unethical) financial practices that lead us to (and perhaps kept us in) a crippling recession. His administration is currently pushing a Wall Street reform bill that will help overhaul the American financial system. After a filibuster and several other stalls from the Republicans, the Senate unanimously agreed on Wednesday to begin a public debate on this. Obama says he hopes this reform bill passes quickly, and so do I.

According to Reuters, Obama says the bill "may reduce the bonuses for some of the players on Wall Street, but we'll end up having a safe, more secure financial system, and I think banks and other financial institutions can get back to making money the old-fashioned way by lending it to companies to build business and create jobs." One of my favorite quotes from Obama on the same topic is this: "Some of the behavior generally on Wall Street, even if it's legal, doesn't seem to serve an economic purpose." It's definitely time for more transparency.

The bill would add more consumer protection from predatory lending, in addition to much greater oversight in the banking industry and stock market. While we wait for the results, I hope you will read on and enjoy my roundup of some of the best personal finance blog posts from the past week!

Lesbian sex, abortion, gay marriage and ... credit card debt.

That mixed bag of hot-button topics is just a small sampling of what's in Esquire's "Survey of American Women," released in May 2010 issue. The just-for-fun study complied the results of about 10,000 women that took the men's magazine survey online between Feb. 4 and March 3, 2010.

Most of the questions centered around relationships (If you knew you wouldn't be caught, would you cheat?), sex (If you were or are a lesbian, what celebrity would you sleep with?) and plain old hawtness (Who's the best looking man in America? Hint: See picture above.) But readers also got a small peak at the financial habits of today's Esquire-reading women.

Read on to see what the survey results.

Unless you've been in a coma for the past week, you know that a volcanic explosion in Iceland on April 14 rocked Europe. Flights were grounded for nearly a week in more than 20 countries, leaving countless travelers across the globe stranded, many of whom had to sleep on cots at airports and live on a diet of airport food while running up their credit cards.

Those with travel insurance fared better than those without, but it was a pickle for everyone. Some countries resorted to sending boats to various countries to retrieve some of their citizens and military personnel. People missed weddings, funerals, birthdays, vacations, work and more.

Times like these prove why it's so important to have a hefty emergency fund set aside. It helps to have a credit card with a large amount of available credit in case you get in a bind. It's also always smart to carry some cash in case electricity goes out and your credit cards can't be processed. I recommend you spend a few minutes thinking about how prepared you are for an emergency.

I hope you will take the time to read the following roundup of some of my favorite personal finance blog posts from the past week!

What a week. This Wednesday, the U.S. stock market surged and hit major milestones it hasn't reached in nearly 19 months. Those of us with investments were finally able to do a happy dance!

This Thursday was probably the most dreaded days of the year in America: tax day. Most of us were scrambling to make sure our returns were filed and payments submitted before the clock struck midnight. I was actually quite happy on tax day for the past two years as I received a tax refund of around $2,000 each time. But then I realized that I was giving the government an interest-free loan and was missing out on around $166 of income each month. I changed my withholding amount, and this year was smacked with a $454 tax bill. It's not fun owing taxes to the government, but we all know what happens if you don't pay up.

Now that your taxes are taken care of and you can relax, read this roundup of some of the best posts in the personal finance blogosphere from the past week about credit card debt.

Seven of the best personal finance bloggers on the Web agreed to a group interview, and I'm happy to present it here.

Learn their tips for smart credit card use, best ways to pay down debt, find out their thoughts on the CARD Act and whether it's possible to live without a credit card.

It's a varied group, from FreeFromBroke to TheDigeratiLife to Man Vs. Debt to Mr. Credit Card, and so I'm not at all surprised they disagree on some issues. The one thing they have in common is a passion for figuring out personal finances. I learned some things and hope you will too!

I just read Fortune magazine's article on famed financial forecaster Meredith Whitney's predictions on the future of credit, of which she says there will be little to go 'round.

To sum it up quickly, she says the new Credit CARD Act's restrictions on card issuers -- especially in regard to restrictions on instant interest rate increases -- will, in effect, prevent banks from lending "en masse" like they had before.

Her conclusion: small businesses, the unbanked population and consumers who rely on credit cards to make ends meet will turn to predatory lenders and end up paying dearly in fees and interest rates.

But weren't we already paying dearly for our debt?

If you've ever defaulted on a loan or credit card, you have likely had creditors knocking on your door. If you fail to pay what you owe, many creditors hire private debt collection agencies to chase after you and try to recoup some of that cash, even if it's just pennies on the dollar. But what happens if you fail to pay your city's water or trash bill?

The practice of hiring debt collectors was primarily reserved for private companies, but things have changed in this shaky economic climate.

Several city governments are now relying on private debt collectors to gather up funds from residents for unpaid utility bills. It's part of a larger trend of government agencies, such as school boards, county courts and libraries, to hire third parties to do the dirty work of debt collection.