Valentines Day Roundup

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Well todays is the big day. Cupid is on the prowl to get your heart. I am doing some shopping today for my wife. She said not to get her anything for Valentines Day, so I am out getting her something for Valentines Day.

Cheap Valentine's Day Gift at Barbara Friedberg Personal Finance

Dollar Matters: Fun with Investing at Financial Highway

Fighting Fair: How to Disagree About Money in Marriage at Free Fro Broke

The War on Debt: The Battle Begins at Home at Frugal Dad

Valentine’s Day Plans? at Five Cent Nickel

5 Frugal Valentine’s Day Ideas at Bargaineering

Help, My Spouse is Out Of Financial Control! at Personal Finance By The Book

I was mentioned in these carnivals and roundups:

Carnival of Wealth #25 – Valentines Edition

Personalfinancebythebook.com

Mint.com

Roadrunner.com

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Good Credit Saves You Money On Insurance - Sorry Dave Ramsey

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To get good rates on insurance you must have a good credit score. Our friend Dave Ramsey says swear off debt and let your credit score go to zero. If I do this my insurance rates will go up. Insurance companies take a look at your credit before providing you with a quote. Insurers have determined that a persons credit history tells a lot about what type of person you are. 


Now don't get me wrong. I am a fan of ol' Dave Ramsey. I drank the kool-aid long ago. But his idea of completely being off the debt grid is not for me, quite yet. I still need the effects of a good credit score. I tip my hat to Dave Ramsey everyday for showing the way, he will have to forgive me for this one detour off the plan.

When you apply for any kind of loan, lenders will look at your credit history for the following things. How often you have applied for credit. How you pay back your credit and what your overall credit history looks like.

According to this report you are either issued credit or told to hit the road. Insurers also want to look at the report for many of the same reasons. They want to get a general understanding of your overall financial picture. They also want to see if you can afford the premiums and how well you manage your credit.

They believe the way you take care of your credit will be the way you take care of their insurance. Bottom line low credit scores equal more claims.

If the insurance companies can tell if you will file more claims by your credit score, the way they do it is a well kept secret of the industry. There is no evidence of such a correlation being true in the general public.

Is it legal for the insurance company to access your credit report? Yes because when you sign the insurance application, in the fine print it says you are giving them permission to. 

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If you ask the insurance companies to not access your credit report they will probably say they will not be able to write you a policy. I can understand how factors like your past insurance claim history, location, marital status, age and income are proper in using to determine your risk level. But credit history, no.

Not only do insurance companies use your credit report. When you rent an apartment you can be turned down if the landlord sees you are not a good payer of your bills. The landlord may even charge you a higher deposit because of your poor credit. 


Cell phone companies access your credit worthiness when signing you up for a cell phone contract. You can be turned down because of a bad credit score. A low credit score would mean they would have to charge you a high deposit.

What would Dave Ramsey do in situation? He would rather have no credit score and be debt free and pay the higher premiums. I guess for him it's OK to pay extra, because he has the money to. He is the no debt guru, so it would be hypocritical of him to not do so. But for me I'll keep my credit score high so I can save some money on insurance. Maybe just having a mortgage is enough.


Remember check your credit score at Annualcreditreport.com where you can get a free credit report. You get one credit report per year per credit reporting service. There are 3 services so you can actually get 3 reports per year for free.

Related articles

• Your Insurance Company Wants to Know Your Credit Score (creditscore.net)
• Understanding The Dave Ramsey Credit Score Myth (creditscore.net)
• Dave Ramsey: Worker should save before contract up (knoxnews.com)
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Readers Question: A Debt Collector Is Threating me if I Don't Pay | What Should I Do?

Some debt collectors use horrific tactics to collect on bad debts. I have heard money guru Dave Ramsey on his radio broadcast relate the stories he has heard over the years of the over the edge tactics debt collectors use. 

Dave Ramsey told of a woman who was being harassed by a debt collector. Somehow the debt collector got out of her that her dog had died. Using this information, threatened her that if she didn't pay he would go and dig the dog up and hang it from a tree. This unnerved the woman so much she paid the debt. She was in such a state that she made several trips to the burial site of the dog to see if he had been dug up. 

This kind of harassment is extreme, yet everyday federal law is being violated by these debt collectors and it goes unpunished. The following list is the from the Fair Debt Collection Practices Act(FDCPA). This is the law that specifys how what practices debt collectors can not do. If they are doing these things you can report them to the FTC and sue them.

What practices are off limits for debt collectors?

Harassment. 

• Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:
• use threats of violence or harm; 
• publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies); 
• use obscene or profane language; or 
• repeatedly use the phone to annoy someone. 

False statements. 

• Debt collectors may not lie when they are trying to collect a debt. For example, they may not:
• falsely claim that they are attorneys or government representatives; 
• falsely claim that you have committed a crime; 
• falsely represent that they operate or work for a credit reporting company; 
• misrepresent the amount you owe; 
• indicate that papers they send you are legal forms if they aren’t; or 
• indicate that papers they send to you aren’t legal forms if they are. 

Debt collectors also are prohibited from saying that:

• you will be arrested if you don’t pay your debt; 
• they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or 
• legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action. 

Debt collectors may not:

• give false credit information about you to anyone, including a credit reporting company; 
• send you anything that looks like an official document from a court or government agency if it isn’t; or 
• use a false company name. 

Unfair practices. 

• Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:
• try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge; 
• deposit a post-dated check early; 
• take or threaten to take your property unless it can be done legally; or 
• contact you by postcard. 

Do I have any recourse if I think a debt collector has violated the law?

You have the right to sue a collector in a state or federal court within one year from the date the law was violated. If you win, the judge can require the collector to pay you for any damages you can prove you suffered because of the illegal collection practices, like lost wages and medical bills. The judge can require the debt collector to pay you up to $1,000, even if you can’t prove that you suffered actual damages. You also can be reimbursed for your attorney’s fees and court costs. A group of people also may sue a debt collector as part of a class action lawsuit and recover money for damages up to $500,000, or one percent of the collector’s net worth, whichever amount is lower. Even if a debt collector violates the FDCPA in trying to collect a debt, the debt does not go away if you owe it.


Related articles

• What To Do When the Debt Collector Calls (abcnews.go.com)
• Four Mistakes Not To Make When Talking With A Debt Collector (creditscore.net)
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10 Great Tips When Looking for a Home to Buy

Shopping for a home can be an exhilarating or dreadful thing to do, depending on your personality. The applying for financing, the realtor's, the multiple homes to view, it's a lot of work. It's such a big decision that if done incorrectly, will have results that you must live with for a long time. I have compiled a helpful list of ten tips to get you started.

1. Never be the one who makes the first offer on a home. If the home is in your price range let someone else bid on it first. You may lose the bidding. But you will see what others think the house is worth.

2. On paper comparable houses look the same. Don't be in a hurry, because with a lengthy inspection you may find it has better views, parking or amenities. Take your time.

3.Realtors have a list of inspectors whose job it is to notice the worst details of the home. Skip the inspectors and get a seasoned building contractor who has seen it all. They will tell you where the dead bodies are buried. They have seen what damages can occur in a home and what it takes to repair them.

4. Never ever make an offer on a house that is broken or needs repairs. The seller may have the work done but will it be done correctly? There's a world of trouble that comes from shoddy work that may take months to show up.

5. The important thing when you select a house, is to be able to see what can be changed and what can't. For instance, you can change the rugs, repaint the walls, remodel bathrooms and kitchens. You can't change the road system, the neighborhood, the climate, or the schools.

6. Have a walk thru before closing. Turn on all the faucets. Check under the sinks. Turn on all appliances. The hot water heater,A/C, furnace, sump-pumps, sprinklers, etc. Do a thorough walk thru.

7. You need to look at your house closely and not get caught up in stupid things like granite counter tops or paint color. Look at doors and trim to see if they are cheap or solid, fixtures, kitchen drawers, closet space. Does the basement seem musty? Really take your time to look at the house you are buying.

8. Make sure that you really want to be a homeowner, especially of a house. There are hours of raking, painting, and other maintenance issues, plus no super to call when things break (and they will break). Owning a house takes more time, energy, and money than you expect.

9. Ask your homeowner friends for a list of expenses, so you know what you are getting into. Consider both ongoing expenses and big things out of nowhere like the roof needing replacing. Expect one big thing a year. Consider utilities, insurance, property tax, any assessments such as for sewers.

10. Spend some time in the neighborhood in the daytime and at night during the week and on weekends. Perhaps there is an incredibly noisy bar around the corner or a neighbor who plays his stereo at 2 am. Or neon signs that blink into the windows all night.

Spending some extra time, it will give you the confidence you are making the right decision.

Use these tips to access the compatibility of the home to your life style. Don't have house fever. People get caught up in the process. Remember take your time.

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How Do I Motivate My Son to Save Money?

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In life I believe most people are not born savers. So take this into account when your trying to help someone change direction. I was a spender for most of my life and did not change direction until I was forced to, out of necessity. Even then it didn't happen overnight, there was a lot of false starts along the way.

Kids are especially tough to motivate. They are usually so immature it's hard to find a way to reach them. They are inundated by a constant barrage of TV ads, showing them nice shiny things to buy. They actually expect their parents to buy them these things. So back to the question; How do I motivate my son to save?

There isn't a one size, fits all answer to the question. Like me you will have to find something your child feels strongly about. Kids always want you to buy them something. This is your opportunity to use the situation to teach a lesson. Showing them that life is about prioritizing todays wants and integrating them into long term goals. 

One technique I have used to teach my kids is to relate a story about my youth. I told them the story about when I was young and went to my parents to buy me a bicycle. I described how they couldn't afford it and told me to save up for it. I had a small job at my Dad's work, sweeping up. I worked many months at that job. Over time I made enough to buy that bicycle. I told them that the way to get things was to work for them. I told them that they must learn WORK=MONEY. My Dad taught me that lesson and I will be sure to teach that to my children.

You must show your kids how present choices affect their future options. Talking to your kids about the things they need and want. Letting them come up with ways to reach their goals. Kids know they have to save for things but they chose not to because they are in the "I want it now" mode. Getting them to stop acting like this, only comes with time.

I am lucky to have 3 out of 5 children that have learned saving is the way to operate. But the other 2 don't quite get the idea and are taking a little longer to catch on. I firmly believe that if your children don't learn to work and make their own way they just could be living with you the rest of your life.

Related articles

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Debt Collectors Are Calling me Everyday - What are my Rights?

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The Federal Trade Commission (FTC), the nation’s consumer protection agency, enforces the Fair Debt Collection Practices Act (FDCPA), which prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from you.

Under the FDCPA, a debt collector is someone who regularly collects debts owed to others. This includes collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and then try to collect them.


If you’re behind in paying your bills, or a creditor’s records mistakenly make it appear that you are, a debt collector may be contacting you.

Here are some questions and answers about your rights under the Act.

What types of debts are covered?

The Act covers personal, family, and household debts, including money you owe on a personal credit card account, an auto loan, a medical bill, and your mortgage. The FDCPA doesn’t cover debts you incurred to run a business.

Can a debt collector contact me any time or any place?

No. A debt collector may not contact you at inconvenient times or places, such as before 8 in the morning or after 9 at night, unless you agree to it. And collectors may not contact you at work if they’re told (orally or in writing) that you’re not allowed to get calls there.

How can I stop a debt collector from contacting me?

If a collector contacts you about a debt, you may want to talk to them at least once to see if you can resolve the matter – even if you don’t think you owe the debt, can’t repay it immediately, or think that the collector is contacting you by mistake. If you decide after contacting the debt collector that you don’t want the collector to contact you again, tell the collector – in writing – to stop contacting you. Here’s how to do that:

Make a copy of your letter. Send the original by certified mail, and pay for a “return receipt” so you’ll be able to document what the collector received. Once the collector receives your letter, they may not contact you again, with two exceptions: a collector can contact you to tell you there will be no further contact or to let you know that they or the creditor intend to take a specific action, like filing a lawsuit. Sending such a letter to a debt collector you owe money to does not get rid of the debt, but it should stop the contact. The creditor or the debt collector still can sue you to collect the debt.

Can a debt collector contact anyone else about my debt?

If an attorney is representing you about the debt, the debt collector must contact the attorney, rather than you. If you don’t have an attorney, a collector may contact other people – but only to find out your address, your home phone number, and where you work. Collectors usually are prohibited from contacting third parties more than once. Other than to obtain this location information about you, a debt collector generally is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.

What does the debt collector have to tell me about the debt?

Every collector must send you a written “validation notice” telling you how much money you owe within five days after they first contact you. This notice also must include the name of the creditor to whom you owe the money, and how to proceed if you don’t think you owe the money.

Can a debt collector keep contacting me if I don’t think I owe any money?

If you send the debt collector a letter stating that you don’t owe any or all of the money, or asking for verification of the debt, that collector must stop contacting you. You have to send that letter within 30 days after you receive the validation notice. But a collector can begin contacting you again if it sends you written verification of the debt, like a copy of a bill for the amount you owe.

Debt collectors are relentless in hounding you for their money. They will call day and night, ignoring the law in pursuit of a settlement. They will harass you and belittle you into paying them. They will use psychological pressure to make you pay them before you pay your electric bill. They are good at their job. You have legal rights under the law, it's your duty to know these rights because they afford a protection that you are due.

Federal Trade Commission Website - http://www.ftc.gov

Related articles

• Understanding The Statute Of Limitations On Debt (creditscore.net)
• How to Win the Debt Collection Game with Dignity (trueslant.com)
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