Money In The News: Game of Thrones Star Broke, Unemployment Rate Down, Deducting Cat Food on Taxes, Starting an Emergency Fund

The Irish Times posts about how over $32 trillion in anonymous funds were revealed in off-shore bank accounts, and by who.

A number of high profile names were linked with offshore trusts and accounts, based mainly in the British Virgin Islands, including presidents, wealthy individuals and families, government officials, a British millionaire, and the eldest daughter of former president of the Philippines Ferdinand Marcos.

TMZ reports that Game of Thrones Star, Queen Cersei, is pretty much broke (not sure of the validity behind this entirely, but I know she is going through a divorce).

Actress Lena Headey — aka evil Queen Cersei from “Game of Thrones” — claims she’s dead broke with “less than $5 in her bank account” … and she desperately needs her tax refund to cover her living expenses.

Marketplace Economy posts about Unemployment falling to 7.6% with 88,000 jobs added to the industry.

The Bureau of Labor Statistics reports the economy added 88,000 jobs last month, falling below analyst expectations. The unemployment rate ticked down to 7.6 percent from 7.7 percent. posts about 6 steps to starting your emergency fund.

Make saving a non-negotiable expense.

Most people wrongly believe that they don’t have any income to save, because they expect the money to appear out of nowhere.

Savings is a process that you must be proactive in directing. Build the “expense” of saving into your budget, just as you’d approach a utility or credit card bill.

If you knew that going out to dinner with friends would make you unable to make your monthly car payment, for example, you’d have no choice but to postpone plans. Be just as disciplined about saving.

Generation X Finance posted an article about 9 crazy tax deductions that actually worked (Some of these make me go wtf?)

1. Cat Food
The Seawrights were allowed to deduct $300 for cat food. Yes, food for those fuzzy four legged pets that think that bringing their owners dead rodents and birds is the “cat’s meow” of a gift for a loved one.
The Seawrights argued that the deduction of the cat food was a legitimate business expense because they fed some feral cats on a regular basis, and the kibble kept the cats around the junk yard that they operated. Because the well fed cats regularly roamed around the junk yard, they hunted and killed rodents and snakes; so the cats were a natural source of pest control that protected their business.

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Money Drain: $3,000 Lost by not having the correct auto insurance coverage

How I was scammed from my auto insurance policy

Over the years I have always heard about how some insurance companies have scammed their customers in one way or another. Even though I have always been a smart shopper when it comes to my insurance coverage, especially auto, I was recently faced with a nightmare of an ordeal related to my auto insurance.

Prior to being scammed, I had been with the same insurance company for over ten years. When I decided to buy a home, I price shopped for home insurance policies and found that there were cheaper rates elsewhere. I also discovered that combining my policies together would lower the overall rate and make my premiums lower. I finally found a company that would save me money and offer the best coverage available for the premium cost. Little did I know that they were not all they said they would be and there were several loopholes in my policy that cost me a lot more than just the cheap premiums each month.

Last year, I had a driver pull out on in front of me and because the roads were slippery. I was unable to stop and ended up broad siding the car. While no one was hurt in the other car, my passenger had to have several surgeries on his lower extremities. When my insurance company was contacted by the hospital everything seemed fine. But when I called a few hours later to report the accident, I realized that my policy was basically not as broad as I thought it was. Initially, they told me that the policy canceled out the month prior because they did not receive payment until 3 days after the due date due to a computer glitch. I checked my records and reassured them that the automatic withdrawal was taken it out, in fact, a day earlier than expected. It was almost as if they were making excuses as to why they didn’t have to pay the claim. They argued with me that there was a short lapse in coverage and they would not be able to cover my entire claim because my rate would increase and the dollar amounts were different than in my original policy. They also said that if I turned in the claim to be processed that my rates would go up and my monthly premium would rise. My passenger ended up paying a lot of out of pocket costs because the insurance company refused to pay.

The next issue I ran into was the replacement value of my totaled car. A few days later when I talked to an insurance adjuster, they came back with a considerably lower amount to replace the vehicle than I thought I would get. My car was only a year old and they only wanted to replace around $5,000 worth of damages. The car only had 26,000 miles on it and was in excellent shape prior to the accident. They stated that this was company policy and the dollar amount was based on other vehicles that were comparable in value to mine. They didn’t even ask about the overall condition of the car before it was in the accident or how many miles it had on it.

I was stuck paying over $3,000 out of pocket and that was not including the insurance premium that skyrocketed an extra $140 a month. In order to prevent this from happening again and to prevent it from happening to others, it is important to check over all of the clauses in an insurance policy or contract before continuing the policy. Don’t always ask about the cheapest policy but inquire about what all is covered on the policy and any limitations that may be involved.

– Submitted by Alex G

Lesson Learned:
Insurance is a complicated beast. Alex is right in a lot of his sentiments regarding saving money on car insurance such as saving money by combining car insurance and house insurance with the same carrier. There are several ways to save, but all of it is for naught if you don’t have what you need when the time comes.

The first step is determining how much car insurance you actually need. The Wall Street Journal gives a good break-down of how much car insurance you need, and what each policy means or what it covers. Obviously the more extensive the policy, the more expensive it is over time. For older vehicles (like my 1978 Ford Bronco), I usually get liability only. My bronco is a tank, so I’m not as concerned about personal injury (plus most of us have health insurance), but it can also do a lot of damage to fiberglass automobiles, so liability is crucial (and the minimum generally required to legally operate a vehicle).

The second step is to shop around and find a reputable insurance company by doing your research. Read reviews, don’t hesitate to shop online, read their policies to make sure it covers everything you need. Be pro-active and ask about discounts they might have available. Skip items you don’t need, or can get cheaper elsewhere (such as towing insurance).

And of course, get at least three quotes from different agencies, maybe one from a direct seller like Progressive, another from a large brand like Allstate, vary it up a bit to get an idea of which direction you want to go.

There are also a lot of tips that people don’t realize when utilizing your car insurance.

For example: Did you know that your credit history can affect your insurance premium? Not all of them do, but some insurers will assess an insurance risk score based off of your credit history.

In addition to that, some states will even allow you to stack your coverage, most don’t, but a couple will let you collect from multiple policies you might hold.

Either way, insurance is a nasty beast 🙂 You should do your research, and regularly reassess your insurance to see if you can get a better rate somewhere else. My future father-in-law recently saved $1500 a year by switching his insurer, which may be a success story here shortly 🙂

Amount Flushed Down the Money Drain: $3,000+

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Money Tip: Christmas and Taxes Don’t Have to Empty the Piggy Bank

My boyfriend Donald and I did our regular balancing of our accounts the other day. We are 30% to our goal of funds we have budgeted for the holidays this year.

What? The Holidays? We just FINISHED the holiday season, why are you talking about it again already??

Well, simple really. By planning now, we’re taking out all the headache and stress out of later. And it’s so simple, ANYONE with determination and a little organization can do it.

Learn how I plan for the holidays each year, a year ahead of time 🙂

Since Donald and I moved in together, I had to adjust my usual Christmas planning budget to account for the additional family, and now the new travel expenses we’ll have to visit his family in Texas every year. But the bonus of this is, he’s also taking on half of the budget from his own salary.  That way we’re both planning ahead and sharing in the expense.

It’s truly a simple concept to save for expected expenses.  People should take more advantage of this method for things they know they’ll have to have money for in the future.  Some immediate examples I can think of include:

  • Car insurance dues
  • Needed automobile maintenance such as new tires
  • Holidays (or birthdays and anniversaries)
  • Fuel oil fill-ups or septic clean-outs
  • New used vehicle (or brand new vehicle, if that’s your thing)

A lot of these you can get a really close estimate to how much you’re going to need to budget for.  For me, I know where I buy my tires from a wholesale tire joint, and I know the type of tires I’m going to need.  I called ahead of time to get a price, and maybe budgeted for $50 more than that, knowing I would want to replace them in 2 years.

So I had my price, my time-frame, and could easily figure out how much per paycheck to put away.  Once the time came for the new tires, I already had the money available, so no debt is accrued.

Easy Steps, because who doesn’t like lists?

  1. Make a list of an item or items you know you’re going to need or want in the future.  You can just use Google Docs or a simple Word file for this.
  2. Figure out or call for estimates for these items, add it to your list
  3. Calculate when you plan to get these items (tires every 2 years?  Holidays once a year?)
  4. Decide how much per paycheck based off of that number that you’ll need to put away to reach your goal.  For example, if I need $500 for new tires, I divide that by 12 months.  If I get paid twice a month, I can divide it by 24 instead to account for the two paychecks each month.
  5. Start auto-saving!  I put all of these in their own separate savings account so I know not to touch that money 🙂  By the time I’m ready for the tires, I can pay for them upfront without the stress or worry.

It really is just that simple, and it’s the same approach I use towards all of my regular bills, from life insurance payments, taxes, holidays, maintenance, etc.

What sort of methods do you have for planning future expenses?  I know my method may not work for everyone, but it’s done wonders for me.

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