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Emily Starbuck Crone

Emily's list: Warning labels edition

This week, the Food and Drug Administration revealed the new graphic warning labels that will be slapped on cigarettes by next year. These nine grisly images depict things such as a man smoking through a tracheotomy and a corpse of someone who smoked. Other images include a smoker's rotting teeth, smoke surrounding a baby and lungs charred by cigarettes.

Everyone knows cigarettes are bad for you, right? Tobacco kills around 443,000 people in the United States each year, according to the U.S. Centers for Disease Control. About 20 percent of our population still smokes. Cigarette warning labels are already much more prominent in Europe, but the U.S. hasn't had a drastic change to cigarette packaging in 46 years, when the Federal Cigarette Labeling and Advertising Act of 1965 was passed.

Our new labels are going to take up a lot of real estate, too. According to the U.S. Food and Drug Administration, the new cigarette health warnings will appear:

  • on the top 50 percent of both the front and rear panels of each cigarette package.
  • in the upper portion of each cigarette advertisement, occupying at least 20 percent of the area of the advertisement.
Warning labels edition

The law instituting these actually passed in 2009, but cigarette companies have until September 2012 to get on board. The tobacco companies are, of course, fighting it with lawsuits, but we'll see what happens.

I wonder what the world would be like if more things came with scary warning labels. What if payday loan stores had a large window decal that said, "May keep you in debt forever!" Or if mortgage companies had to put "Danger of foreclosure if you take out more than you can pay!" on its paperwork.

Unlike smoking, credit cards aren't inherently bad for you -- they can be valuable financial tools and the source of all kinds of rewards. But some people don't have much financial education, so one area of the financial reform laws that I liked was the requirement that credit card companies make the terms easier to understand. Credit card agreements are now unreadable to four out of five American adults. I also really like that the statements now have to show how long it would take to pay the debt off. I think it's a good reality check.

What do you think? Are warning labels the answer for cigarettes? Or risky personal finance tools? Warning labels aren't as important when you already have a solid education about those things. Increase your personal finance smarts by reading my favorite blog posts from the past week. I'm not blowing smoke and I promise it won't be a drag.

1. Frugal Dad discusses his journey out of debt and explains how to avoid "lifestyle creep" and save instead of going into (or back into) the red.

2. Bargaineering lists the pros and cons of giving prepaid debit cards to your kids and whether regular debit cards are a better option.

3. My Journey to Millions features a guest post from his wife, who explains why she went from hating credit cards to seeing how they can be a useful tool if used wisely.

4. Money Beagle explains how personal finance is a bit like cologne; a little common sense goes a long way.

5. Wisebread presents a list of seven important financial lessons that frugal parents pass on to their kids.

6. Finance Fox discusses the importance of eliminating the extra things you pay for but don't really need and shows how he managed to do this.

7. In light of his own credit card being used for unauthorized purchases, Cash Money Life offers advice on what to do if your credit card is stolen.

8. I Will Teach You to Be Rich bemoans recent news that most Americans couldn't come up with $2,000 if needed and offers advice on how to avoid being in that situation.

9. Good Financial Cents talks about many bad money habits that can truly damage your finances.

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