The Federal Trade Commission Fights Back Against FreeCreditReport.com

Update: The videos are slow to load at the moment…

The songs are not as catchy, but the message is perfect and easy to understand.  I found this originally on Consumerist.com, which was recently purchased by Consumers Union, the non-profit that runs the popular Consumer Reports magazine.

If you have been awake for five minutes over the last couple of years, you have probably heard those catchy tunes from FreeCreditReport.com.  (Don’t go there!)  While they will give you your credit report for free, you very well may get trapped in to ongoing fees related to credit report updates.

However, there is a genuine and legitimate free credit report website, and it is called AnnualCreditReport.com.  At some point, the government required Experian, Equifax, and Transunion (the three credit reporting agencies) to provide Americans with a free credit report once a year.  AnnualCreditReport.com is their joint project to make that happen.

I would do three things:

1.  I would watch these videos.  They are entertaining enough to watch and share.

2.  Visit consumerist.com on a regular basis for great consumer tips.

3.  Visit AnnualCreditReport.com once a year to get your latest credit information and verify that it is correct.

Enjoy:

And this one:

Want A Politically Viable Gas Tax? Make It Voluntary - Freakonomics Blog - NYTimes.com

Image via Wikipedia

I am not very confident that this would work because of some logistical issues (see the comments below the story) but it is a very interesting idea that possibly could be implemented in some type of hybrid form.

The idea in a nutshell?…

The government would offer a $500 advance tax rebate each year for every car you choose to sign up for the tax. In return, you would commit to pay an extra $1 for each gallon of gas you buy. The actual tax paid would be based on miles driven and fuel economy. Thus a Chevy Impala rated at 19 m.p.g. would be charged $5.26 each 100 miles, while a Prius rated at 46 m.p.g. would be charged $2.17 per 100 miles.

For cars with average fuel efficiency (22.4 m.p.g.), you’d break even if you drove 11,200 miles a year. People who already drive their cars less or who drive fuel-efficient cars would be particularly likely to opt for the independence bonds. But even these folks would have a strong economic incentive to reduce their driving.

Want A Politically Viable Gas Tax? Make It Voluntary - Freakonomics Blog - NYTimes.com

Arizona Family of Seven lives debt free on $44k a year

This is incredible.  We have cut way back in our family as well, only buying with cash/debit, and being frugal about most things.  However, we are nowhere near as tight as this family of seven in Arizona.

Note:  Is there anything odd about this family’s last naming being “Economides” considering the subject?  It is akin to Mr. Christmas being a pastor, or Mr. Noble being known as noble, or Mr. Frank, hot-dogging around.

How family of 7 live on $44K a year - Staying Afloat - MSNBC.com

The couple and their five children bill themselves as “The Cheapest Family in America” and “The Frugals.” On Thursday they showed TODAY viewers how they, too, can have everything they need and live debt-free in an expansive home in one of America’s tonier neighborhoods — on less than $45,000 a year.

“The economy is in a tailspin, and we’re just perfectly fine,” Annette Economides told TODAY’s Ann Curry in New York, adding, “I am the Warren Buffett of groceries.”

With great jobs being far and few between, here is how to find one

This list contains some pretty basic and common sense advice, and is probably more relevant in a strong economy, where everyone who wants to work is working.

I would probably add a couple of things to this list.  One of the first questions anyone asks when they are looking for a job is, “How much does it pay?”  I would also venture to guess that others may ask themselves, “What would my peers and family think.”

The pay question is the most complicated one.  If you are only getting a job because of the pay, chances are, you won’t be happy.  Consider pharmacology.  Yes, it pays $60+ an hour, but many people cringe at the idea of standing behind a desk sorting pills 8 to 10 hours a day.  Not only that, but considering the trends of American culture, many people never make enough money to satisfy their spending habits.  Take the pharmacologist again.  Apparently a high percentage of them buy a Mercedes upon graduation.  Good for them, but while they may make 3 to 4 times more than you, their car payment is 3 to 4 times more as well.  So, they get to have a job standing behind a desk sorting pills for 8 - 10 hours a day so that they can drive home at 8:00 PM in their Mercedes and impress their family and friends.  (Which thoroughly covers the second question.)

Don’t get me wrong, pharmacist are very important, and many people are psychologically cut out for that line of work, but I think you get my point.  Just in case, as long as you have money for food, shelter, water, and clothing, after that, no matter how much money you make, it will never be enough…unless of course, you are one of the minority of Americans who do not base their happiness on the material things that they have accumulated over the years.

Consumer Tips: Empowering YOU to be a savvy consumer Blog Archive - Do this to find a great job « - Blogs from CNN.com

2. Once you think you know those broad areas, open yourself up to what else might rouse you. Here’s a simple technique to identify what that might be: Collect the last four or five issues of Fortune and go through them one by one. Rip out any article or advertisement that sparks a chord. Don’t over-think this. Spread the articles and ads out on the kitchen table and put them into logical groupings. You’ll notice patterns and areas that you probably didn’t realize you were interested in.

Vaccinate us from the ‘Big Three’ - The ‘Transportation Enlightenment’ is on the horizon

Bailing out the three auto companies would not be good governance and would prevent, or at the very least, slow the oncoming transportation enlightenment.  A bailout would be akin to a massive effort in the 11th century A.D. to bail out the Dark Age.  There.  I said it.  Wow.  That feels good.

Some companies, no matter how large they are, deserve to fail, regardless of the consequences.

I have had a bad feeling about the auto bailout since it was proposed, and that feeling has not gone away.  However, until today, I just figured that the right choice will be made in Washington.  If the bailout attempt fails, which appears to be the case, it will be a good example of the avoidance of “groupthink.”  (According to Answers.com, Groupthink is, “The act or practice of reasoning or decision-making by a group, especially when characterized by uncritical acceptance or conformity to prevailing points of view.”)

Bad companies should fail, regardless of the consequences, especially if they are going to be bailed out at the expense of innovation.  I personally know, as most of us do, many people who will lose their jobs and become financially devastated by the auto company failure, but like a recruit at boot camp in the Marines, the auto industry needs to be torn down so it can be built back up in a grander image.

Michael Moore, love him or hate him, documented the failure of GM over 20 years ago when Roger Smith, the CEO of GM at the time, was systematically betraying the American “widget” worker, sending jobs oversees.  Instead of investing in the American automobile company and technical innovation, he put GM’s massive resources in to buying large stakes in completely unrelated businesses.

GM and Chrysler are bad companies that deserve to fail.  Unfortunately, like the sinking of the Titanic, they are going to bring down a lot of innocent people with them.

But here is the good news.  GM and Chrysler’s pending failure, and possibly Ford being not far behind, does not eliminate the demand and the need for new cars.  Because we are still a largely free-market based system, other companies will pick up where GM and Chrysler failed.

I believe that while we will take our lumps in the process, this will lead to a sort of automobile/personal vehicle/transportation period of enlightenment.  The transportation enlightenment is on the horizon.  Many of the workers who will lose jobs will get new ones in the same industry, but in the meantime, perhaps we should take the same $14 Billion that is proposed to bail out the auto companies and use it to provide career training and other support services to those workers to help them get back on their feet.

Instead of bailing out poorly run businesses, we should invest in the ingenuity, grit, and future of the American worker.  Our government needs to look at this current financial crises as an opportunity to vaccinate our free market system from the ignorance and greed of the bolo-hatted businessman, and put it back in to the education, workforce, and business systems necessary for economies to thrive in the 21st century.

For more reading, visit http://freakonomics.blogs.nytimes.com/2008/12/11/whats-the-point-of-bailing-out-the-auto-industry/

Save more than 30% on your next car purchase - the Daddy Hogwash way

I am hoping my next car purchase is as stress-free as possible.  As of right now, my wife and I have no car payments.  She has a 2001 Ford Windstar and I have a 1998 Ford Explorer.  They serve their purpose.

When thinking about my future vehicle purchase, I think about three things:

1. I will most likely never buy a new car again.  (Stay tuned for my reasoning)
2. I will do everything in my power to buy my car with cash.
3. I want my next car to be more environmentally friendly.

I had never considered number 1. on my list before I read the following anecdote attributed to Warren Buffett.  As many of you know, Buffett, for many years after he attained billionaire status, continued to drive around town in his VW Bug.  He was asked often, “Why don’t you buy a new car Warren?  You certainly can afford one.”  In no time at all, he replied back, “Well, for the history of my investment experience, I have made an annual return of 23% of compounding interest.  I estimate that a new car would cost me roughly $20,000.  If I took that same $20,000 and invested it at the 23% a year, that works out to about $9,958,257.  I don’t know about you, but $9,958, 257 is just too much money to spend on a car.”

So, on to number 2.  I know that the chances of me making a 23% return on an investment is slim-to-none.  But I did find an online savings account that will give me 2.75%.  (When I first opened the account, it was almost 4%, but the economy tanked.)  I am keeping my fingers crossed that I can get another five years out of my Explorer.  Since the average life of a vehicle is 16 years, cradle to grave, that is reasonable.

Consider two things right now.  Since I am not going to buy a new car, I could buy a used car in my budget for $10,000 and take out a loan at 6% or so for five years.  If I did that, the total payments for my car would equal $13,382.  Or, I could take another route.  I could put $35 a week in my vehicle savings account (that currently has $822 in it) and collect my 2.75% interest for five years.  That is $9922 of my own money, but a total of $10,777 in my bank account.

I can now buy a $10,000 used car for $3382 less than I would have paid otherwise, and still have another $777 left over…which I could use for a better car, or to start the savings for my next car.

Of course, most likely, it would even be better than that, because five years from now, I should be collecting more interest on my account.  2.75%, God willing, is about as low as that rate is going to go.  Not to mention, hopefully I will be able to start putting away more than $35 a week for a car at some point.

Here is a calculator so you can play with the numbers yourself.

What would you do?