I mean, it was difficult enough on the average american when a $45 sweater was marked $25% off.  Most Americans are awful at doing math in our heads.  So, we either short cut it, "let's see, 25% off of $40 is $10, and 25% off of $5 is $1.25.  So, it's $45 minus $10, which is $35, minus $1.25, which is $34 minus a quarter, which is $33.75."  Hmm... is this sweater worth $33.75?  I dunno, is it closer to being worth it since I have spent all this time calculating the price in my head?  Actually, that method is pretty old school, since most just whip out their cell phones and use the calculator.

But now, they have these two step discounting methods.  The headline of this post is an actual sign that I saw at Macy's recently:

"60% Off When You Take Up To 25% Off the Already Discounted Price!"

And of course, on the actual signage the 60% Off and the 25% Off were about double the font size of everything else.  So, what do our minds do?  We don't bother with the smaller words, and just do some really basic math.  "60% and 25% sounds like 85%.  That's a lot." 

So, there I was, killing time, with no intention to buy anything.  But, heck, if I can get a screaming good deal, maybe I'll buy something.  I see a nice shirt, and pull it off the rack.  It's even my size.  Fortunately, this Macy's has price scanners (don't you wish every store had that?).  The tag on the shirt said $50, and there was a red sticker over the price tag (not over the $50, because they want you to know the original, inflated price) that said $25.  I took it to the price scanner, and it said "$20.00"

What?  I thought it would be less.  Dang it, maybe I should do some math in my head.  Wait a minute, what did that sign say?

"60% Off When You Take Up To 25% Off the Already Discounted Price!"

Aargh!  It says "60% Off" and the rest is just noise.  60% off of $50 is $20.  The $25 sticker and the extra words on the sign are just there for confusion.  It's there to get me to grab a shirt from the rack when I wouldn't normally.  By the time the shirt is in my hands, the likelihood that I am going to buy something just went up a whole bunch.

Heck, the fact that they got me to stop at a rack and even look already increases the odds that I will buy something on some exponential level.

Nothing worse then realizing that you got suckered in by effective marketing or store signage.  In the end, all is well.  I put the shirt back on the discount rack, and left empty handed.  The shirt wasn't worth $20.  And the original tag of $50?  You must be joking.

Seriously, the government is now getting into the business of giving financial advice? No thanks. Isn't this the classic overreaction that we see from our investors after a major market move, either up or down?

This isn't even a biased political commentary. The Republicans are just as bad as the Democrats on this count. Remember when W. Bush was running for President in 2000? One of the items that he campaigned on was giving Americans the ability to invest their portion of Social Security in the stock market. Then we had a market crash, and that idea died. Can you imagine if this passed a couple of years earlier? Criticize Social Security all you want, but it is what it says it is, a social program, a safety net. Instead we would have had everyone dumping "their portion" of Social Security into dot-com stocks in 1999. The bubble would have been even worse, and the crash more devastating.

Fast forward ten years, and we have come off of the "lost decade" and specifically a recent market crash. So, what is the answer? Time to get super conservative and invest our retirement portfolios in annuities. Great job timing the market two years after the fact.

Actually, from the story, it appears that he is becoming a broker.  The difference is important, but sadly not recognized by a magazine called Financial Planning Magazine.  You see, he is going to work for the brokerage firm, Wadell & Reed.  Not that working for a brokerage firm precludes you from being a financial planner, although I would argue that it severly limits your ability to do so.

Additionally, the article quotes a Wadell & Reed spokesperson as saying, "He’s passed his Series 7, he’s passed his Series 6, he’s passed his health and life examination. He was just activated at the beginning of this month. He is now trying to build his own financial planning practice."

The problem is that those are broker and insurance agent licenses.  It is a license to SELL securities, mutual funds, insurance and annuities.  It doesn't give you any training, knowledge or ability to provide actual financial planning services.

But this is a good story.  I applaud Aames for turning his life around.  He has gone through some really difficult periods, including bankruptcy, homelessness, attempted suicide, not to mention having to be "the guy who was the sidekick on Charles in Charge."

This means that certain things that we take for granted simply are not reality there.  Things like buildings built to earthquake safety standards, well trained and equipped emergency response people, the ability to bring in aid from nearby regions quickly and safely.

I pulled this off of Kathy Kristof's twitter (@kathykristof).  She has compiled a list of links and tips to help those suffering in Haiti.

Read her advice here, and take a moment to help now.

We entered the decade worried about Y2K.  It began with hanging chads and the dot-com bust, 9/11 and the war in Iraq.  We had Hurricane Katrina, the housing ponzi scheme that led to the housing bust and the near collapse of our financial system.  The fall of Enron, Worldcom and Arthur Anderson near the beginning of the decade and Lehman, Bear Stearns near the end.  We had two major stock market crashes and recessions.  One was even dubbed The Great Recession.

Not for me.  This was the decade in which I met and married my wife.  I saw my two nephews born, making me an uncle, my parents grandparents, and beginning the next generation in my family.

While long hours cause some to lose themselves in their career, this decade I found myself in my career.  I am satisfied every day that my clients' lives are at least a little bit better because of the work done in our office.  Ten years ago, I could not have said that.  Ten years ago, I was worried about making a commission.

I have always believed that adversity leads to learning.  If that is true, our country has a lot to learn from this decade.  And I believe we have.

We learned that in the darkest of moments, patriotism still lives in America.  When we are attacked on our own soil, our political, religious and economic differences can be set aside and we can all pull together.

We have learned that housing prices don't just go up by double digits every year forever.  That you should actually have an income, some money and maybe have decent credit before you buy a house.

We learned that stocks are volatile, and that there is no magic formula.  "dot-com" does not ensure success, nor does asset allocation prevent all manner of losses.

We learned that our country is ready to elect an African-American man the president, but may not be ready to let him lead.

We learned that "too big to fail" simply means that they probably shouldn't get that big.

We learned that black swans exist.

I look forward to the next decade, and to learning what we will call it.  "The 10s"  or "the Teens" or the "Twenty Tens"?

Most of all, I look forward to what we, as a nation, will learn.  And what lies ahead for my wife and me.

Happy New Year to you.  May all of your dreams come true in the decade ahead.

It's a good move for the golden arches as they continue to compete with Starbucks for the coffee crowd.  To really make the move, I think they need to change the decor and seating.  Throw in a few comfy couches and some lounge music and they may really have something.  Although, I can't imagine fries and McNuggets getting cleaned out of the couch cushions.

In the end, I'm just totally in favor of more places providing free wifi.  So, way to go Micky D's!  I'm lovin' it!

We allow ourselves an allowance of $300 per month for personal expenses, including gifts to one another.  It's a generous amount, but you can imagine that the "mine" checking account doesn't typically sit at a very high balance (like maybe around $1,000).

We use one credit card for our common expenses, the Hilton Honors American Express card.  We typically run up a monthly balance of around $2,000-$3,000.  Last month included some large unusual expenses, so our balance was $3,500.  Of course, we pay our balance in full each month.  So, I went online and scheduled a payment without reservation, knowing that we keep enough in the "Ours" account to cover it.

Well, one side not on this.  The American Express card used to be my card before we were married.  And the "Mine" checking account used be my primary personal checking account.  So, it was one of the banks linked to the American Express card for payment.  And, of course, I accidentally selected the wrong bank account.

You can imagine what followed.  American Express submits payment to by Chase bank account, and it is rejected as NSF (Non-Sufficient Funds).  I get dinged with a $33 NSF fee.  I received notification by email, but I didn't even open the email because I thought it was a typical "your statement is ready" or "update to our account terms" email.  So, the next day Amex resubmits the payment request, and again it rejects.  Another $33 fee.  This time, I open my email, and... "Holy Crap!  What happened?"

Here's how I resolved it.  I called the bank and asked politely for both fees to be reversed.  As I have been a long time account holder and do not have any NSF charges on my record they agreed.  Then I called American Express and learned that they resend any rejected payment request three times.  So, the third one will happen today.  And, no, they will not reverse the $38 returned payment fee.  However, they did agree not to charge finance charges for my balance in full payment not being received on time.  I then jumped right back on the Chase site to make a transfer of funds from our joint account to my individual account so that the third payment attempt is not rejected.

Phew!  Crisis averted.

My next action was to remove my individual checking account from the list of payments accounts for that American Express card.  Don't want to make that mistake again.

Unfortunately, for many, dealing with overdraft charges is a much more real and potentially frequent experience.

An article in today's LA Times by Kathy Kristof tells the story of one woman and her struggles with bank overdraft charges (and her high wire balancing act to try to avoid them).  The troubling part of the story is the description of the policy of most banks in this situation.  In the event that multiple charges against an account arrive on the same day, they arrange them from largest to smallest and try to pay them that way.  What usually happens is that the first one causes overdraft, and all subsequent charges also cause the account holder to get dinged with NSF fees.

So, in my story above, let's say that I also has a small check of $20 that I wrote to a friend that arrived on the same day as my Amex payment.  And two other debit transactions of $39 and $78 that same day.  If I understand the article right, the bank would have attempted the American Express payment first, and rejected it.  Due to the large payment attempt, other three transactions would also have been rejected.  Or, if not rejected, paid, but still incur NSF fees.  This despite the fact that there was plenty of money in the account for the $20, $39 and $78 transactions.

At $33 a pop, it's an expensive policy for consumers and a profitable policy for the banks.  According to Kathy's article, Chase will be changing their policy "in the first few months of 2010."

Can't come soon enough.

As you can imagine, there's no way I have time to read all of them.  So, I scan the table of contents and pages for anything that catches my interest.  I read some articles in full, but most get a partial read through.  Based on the pile of magazines currently sitting in my inbox, I think it's safe to say that keeping current on industry publications is a talent that I have not yet mastered. 

One publication that I try to give a fairly thorough read each month is the Journal of Financial Planning.  The Journal of Financial Planning is the official publication of the Financial Planning Association.  The content is relevant, and largely unbiased.  It tends to lean more on the academic and analytical, and less on the sales/soundbite format that most magazines favor, especially the consumer oriented ones.

Upon reading the magazine, I always find that there are articles for which I have an opinion to share and nobody to share it with.  Seriously, my wife is patient and a good listener, but there's only so much that I can talk about the "interesting article that I read in the Journal of Financial Planning."  I've learned the hard way that the word "interesting" is highly subjective.

What better place to share my opinions without worry about whether or not anyone will care or listen than this here blog!  So, I'm going to start a series in which I review and comment on articles from the Journal of Financial Planning.  These posts will be identifiable by the Journal's logo as seen at the top of this post.  Also, I may use some surprising words as "this is a review of an article found in the December 2009 issue of the Journal of Financial Planning."  I know, totally confusing.