Senators have been trying to draft a finance reform bill that allows a new consumer protection agency oversight powers into various financial entities. With so much misbehavior at large banks, there’s no question reform is needed, but many senators question the extent of that legislation. Included in the bill, as it currently stands, is the right to regulate not only banks, but also payday lenders, debt collectors, and other types of financial entities, not associated with the banks that got the country in trouble in the first place.

Payday Lenders Cry Foul

Payday lenders have always been a favorite target for regulatory efforts, but the recent legislation being considered has even some in the Senate wondering whether it goes too far. Senator Bob Corker, of Tennessee, wants a compromise in consideration that payday lending has become a large business that contributes billions of dollars to the economy in many states.

One of the items that Senator Bob Corker is promoting is that the new consumer protection agency can be created, but to not allow it to enforce the rules it sets directly. Instead, for those non-conventional lenders like payday lenders, a separate body of regulators would have to be petitioned to provide enforcement. This doesn’t sit will with people who want massive reform as they claim it will make the new consumer protection agency ineffective if it can only set rules, but not enforce them directly.

Is Limiting Interest Rates Fair to Payday Lenders?

Another item under consideration is the idea of cap interest rates to 36% APR to all consumers, whereas now only loans to military people and their families are thus regulated. While credit card rates being capped makes sound sense in many cases, payday lenders argue that their business model would fold under these limitations.

Payday lenders charge up to 400% APR when the fees are annualized. However, the loans are short-term loans that are meant to be paid back on the next paycheck cycle and to meet emergency needs. They are designed to help people with low incomes and bad credit histories a different avenue to obtain a loan solely on the basis of their credit history. However, by providing this service, the payday lenders take on a large amount of risk that they will not be paid back as the demographic is a high-risk group. The higher the risk in lending, the higher the interest rate. Scaling it back to 36% would mean that payday lenders might have to change their approval rates and/or the requirements for obtaining a payday loan. At any rate, it’s clear they will not be able to do business as usual and thus limit their services. This may prove a hardship for people who need another avenue besides conventional lending sources to obtain emergency funds.

Payday Lender Influence Grows in Washington

It’ll be interesting to see what the final finance reform bill looks like. Right now, one thing is clear: payday lender influence is growing in Washington. Senator Corker, for instance, has received approximately $31,000 from his long-time friend and payday-lending owner of Check Into Cash. This was only one campaign contribution from one payday lender and there are more. This growing influence isn’t just through personal contacts and campaign contributions, but the payday lending industry has become very proactive in understanding how to influence legislation of their industry as they have been a major target over the years.

There is now a political action committee called Community Financial Services Association that was created in 1999 to address legislation being proposed to regulate the payday lending industry. This committee also provides campaign contributions to Senators in the hopes of influencing their decisions.

Finance Reform Needed

While finance reform is definitely needed for banking and lending industries, the debate rages on as to how to do it in a way that is fair to everyone, both consumers and businesses. What may work for a bank, that offers loans to people who have good credit histories, might not work for a payday lender. Which financial entities will be regulated and how? Can there be a “one size fits all” type bill? This is a hot topic of conversation in the closed doors of Capitol Hill. There will be a lot of discussions on how to tweak the bill so as to not hurt the economy, provide fair lending standards to consumers, and also keep businesses that provide a needed service open for business to the same demographics they have served in the past. One thing is certain: Change is coming.

As time goes on, we can find ourselves in a dangerous position with thousands of dollars of debt that is owed and nowhere to turn. Sometimes, we rebound and make the necessary payments, but other times, we must declare bankruptcy of allow our credit cards to go into default. Credit card debt can lead to financial ruin or salvation depending on our capacity and ability to pay on time. One slip up and we can get so behind that we seem to always be catching up.

Budgeting is a great way to avoid overspending and being forced to use our credit cards. If we can budget successfully, we can use our bank account money to take care of food, bills and other financial obligations without having to constantly resort to using credit. Once we have a budget formulated and have made the necessary cuts in it to make sure we can make ends meet without help from credit card companies, we can use our credit cards to make purchases that will be paid off quickly without overstretching ourselves.

Online shopping has also become much easier in recent years and it can be tempting to use a credit card to buy things that we just do not need. In most cases, those selling items are reputable, but it is always in the best interest of the consumer to check the reputation of the seller of anything online to make sure that you will receive what you have ordered in a timely manner. There are ways to resolve any conflicts that you may have with a seller such as simply speaking to them and letting them know that you have not received your item or that the items are not what they should be.

Misrepresentation is something that can happen and it is best to speak with the company to try to resolve the issue without having to resort to getting the credit card company or bank involved. Sometimes, though, it may be necessary to do a chargeback and recover your money for items not received. In many instances, this may be the only way to recover your money from an unscrupulous seller, but you must make sure that you have exhausted all other avenues before proceeding.
Merchants are able to report you for charging back fraudulently, so you must check to see if this has been done. There is a website that tracks such transactions called Bad Customer. The merchant can have you put on a list that other merchants can check and refuse to work with you in fear of a fraudulent chargeback. If you initiated the action for good reason, you can have Bad Customer research the transaction and remove you from the list or you can pay $99 to have yourself removed from the list as well as long as Bad Customer can prove that it was a one-time thing and that you will not do it again.

Retailers lose billions of dollars every year to fraudulent chargebacks, so it is important that they only deal with buyers who are honest and are willing to work with them with any order problems. Once you initiate a chargeback, it is very difficult for the retailers to recover their lost money. Many people who have signed up for trial offers have forgotten to cancel and refuse to sign for packages and claim they never received their goods, which is considered “friendly fraud”, but you may end up on the blacklist by doing this, so fulfill your obligations and open communications to resolve any unforeseen conflicts. It is better to play it safe than to end up on this list of people merchants want no part of, effectively limiting your online shopping choices.

Why You Should Apply Early

State deadlines can range between February 15th, in Connecticut, to July 1st, in Louisiana. In between, the average state deadline is closer to March 15th. Either way, you need to get a head start to get your FAFSA in early, if you want there to be sufficient funds if you have demonstrable need. Otherwise, if you file late, the funds may run out even if you qualified. Check the deadline for your state at the official FAFSA website. The sooner you file the better your changes of obtaining aide, if you qualify.

Why It’s Difficult To File Early

Federal regulations don’t actually require that your tax documents be delivered until the last day of January. That usually means people have to wait until February to file their taxes. If you or your parents are required to submit their income information on the FAFSA, it can be difficult to do so early. For that reason, you can estimate that information and file an amendment later. If you are an emancipated minor, you may not need to file your parents’ income information. If you are listed as a dependent, you will need to get that information ready to file as quickly as possible. You can start to complete your tax returns and wait for your W-2s to arrive to finish the process quickly in time to file the FAFSA early. If you wait until the last minute, you’ll only hurt your chances for getting financial aide, even if you qualified for it.

Bank of America has decided to implement this change right now rather than wait. Rather than allow their customers to go over limit, Bank of America will now stop purchases if they exceed the balance in their account. Many people do this unknowingly as they are not aware of certain transactions taking place on their account and with current salaries at a low, many are purchasing items dangerously close to the bottom of these accounts. With current trends, the banks stand to lose millions of dollars in revenue from fees as well as purchases.

As of July, banks will have to get the consent of their customers to charge any overdraft fees and Bank of America is well aware that it would be an uphill battle and that their customers will not sign these types of guidelines. Rather than fight it, Bank of America has decided to institute the new laws now to possibly keep customers and show that they are not predatory like the Government seems to portray than as in the media. Many of the larger banks will fall in line with Bank of America as they all scramble to find new and inventive ways to charge fees. It is likely that fees for checking account maintenance will go up as well as yearly fees on credit cards, which is already occurring across the board.

Reform In Place

The Credit Card Reform Act of 2009 was signed May 2009, and is now in effect. Besides making some dubious credit card practices illegal, like universal default clauses, it has paid special attention to the marketing of credit cards to people still in college. Regulations put in place now will make it much more difficult for students to get themselves too far in debt while they are still in school full-time. Instead, those students under the age of 21, who are full-time, will be restricted to borrowing only 20% of their income on a credit card and even that requires a co-signor

Co-signor Integral to Strategy

By requiring a co-signor on credit cards for students, the government hopes to curb credit card abuses. If a student cannot obtain a co-signor, they won’t be giving credit. Even if they get a co-signor, they will be limited to borrowing only 20% of their income. Finally, all credit card rate hikes have to be approved by the co-signor.

What Hasn’t Been Reformed

Universities and colleges have some responsibility for the rampant marketing of credit cards to college age students. They get paid to allow credit cards to market their students, using their mailing lists, and through what are referred to as an affinity contract. These contracts can be extremely lucrative for both the university and the lender, and have been the reason more students were targeted this way. The legislation in place doesn’t limit this relationship between schools and lenders and thus it still doesn’t address the issue of aggressive marketing tactics on their home ground. It’s hoped that by limiting the usage for the college student consumer that this will help to curb the problems in credit card lending for people under 21 who are in school full-time.

What May End Up Happening

However, credit cards are not the only alternative to lending for college students. As long as a college student is employed, they can also still apply for a payday loan. It is feared that with the reduction in easy credit on a credit card, many students will turn to other sources of lending to help finance their way through college or for incidentals like books and laptops. These alternatives can be costlier for the student in the long run, but serve an important function to provide credit when credit has been limited in other ways.

Conservation of earth’s resources is good stewardship

1. Replace Your Showerheads

Old showerheads can use up as much as 5 gallons of water a minute. Newer, low-flow showerheads are rated at 2 gpm or less. That’s cutting your usage in half, without even reducing the number of showers you take. A good low-flow showerhead can range from $15 to $30, and many can be installed on your own. If you want to be sure not to damage other piping as you twist and turn the showerhead to secure it, hire a plumber to finish the job.

2. Install Rain Barrels

Free water falls from the sky all the time; we just don’t bother to collect it. If you were to collect it, it can be used for such things as watering your plants indoors or your garden outside. You can use it anywhere that you do not need chlorinated water, like in the laundry or even to take a bath. Most people use it just to reduce their water bill in the summer, when they’re watering their vegetable garden and lawn. You can create your own DIY water barrels. Water barrels range from DIY options as low as $15 to over $100 for manufactured ones.

3. Use Less Water When Flushing

You don’t have to replace your toilet, with a low-flow option to do this; however, it’s still a great option. There are state rebates to replace your toilets that can cover the cost of installation. Check your state website to see what incentives are available. Otherwise, you can also get the same effect by putting a couple of bricks in the tank or a 2-liter soda bottled filled with water. This displaces the water so that the tank is full with less and flushes with less.

4. Replace Your Washing Machine

You can easily use 55 to 60 gallons of water every time you run the laundry. It’s always best to run the laundry with a full load, but what if you could save water even then? With appliance rebates out for energy star compliant appliances, you can get a new washing machine that is a water miser also. You will have to front close to $800 for some of the newer machines, but some of that will be rebated depending on what state and federal rebates are available.

5. Use Less Water

While for $5 or less, you can replace the tap end to get it to aerate the water that you use on tap; it pays just to shut off the valve. Running water when you don’t need it is the main way you spend money for nothing on water. Fix any leaks that occur in the household, even if they are tiny. A small leak can add many gallons of usage a day, and will be reflected in a higher water bill.

For Immediate Emergencies

If you have no cash, but the dental emergency can’t wait, you can always resort to getting check advance loans that will allow you to float the coast until your next pay period. If you’re employed, but don’t have a dental plan, you can opt to put monies aside for dental and medical emergencies through your flexible spending account. Just use all of it before the year’s end, so that you don’t lose it. For Medicare recipients, some emergency dental care is provided as long as it is required for another covered procedure to take place. Thus, if you are in an accident and shatter a jaw, Medicare may cover resetting the jaw and any necessary dental work associated with that covered procedure.

Ask For A Better Deal

Professional dentists are suffering from this recession, like everyone else. Shop around for the best deal, and be clear that you don’t have insurance. If you pay cash upon completion of the procedure, and without filing an insurance claim, they may be more amenable to offering you a better rate. At the very least, they can include other services for free for being a new patient that you might otherwise have had to pay for yourself. Always ask ahead of time what the procedure might cost, before you actually agree to have it performed. Some professionals may even be open to barter in these tough economic times. If you don’t ask, you won’t know. They’ll just assume you don’t mind paying full price. The key here is always to ask for a better deal.

Temporary Fillings

Maybe you’re just a little tight this month, but expect a fatter paycheck next month. If that’s the case, a small delay in care might be the solution. Instead of eating only applesauce during that time, to avoid hitting the sore spot in your mouth, you can opt to use some temporary filling material to smooth out the cavity until you can see a dentist.

Temporary fillings are available at a pharmacy and are typically made from the same materials as real fillings, except that they don’t set. Zinc oxide powder and pure clove oil make a great mixture for a temporary filling and the clove oil has a soothing and anesthetic effect on the cavity. Thus, when you use these products, it can not only reduce the chances of having painful encounters with food you’re eating, but it also protects the tooth better. These temporary fillings are not meant to be used forever, and will gradually dissolve in the mouth until they are no more. You can replace the filling, or opt to go to the dentist when that happens, helping you to budget this dental emergency on your timeframe.

Tourist Dentistry

Heading on a vacation to Mexico? Maybe you want to consider visiting the dentist during that time, even if it does spoil one of your days off. The savings in dental costs across the border can more than make up for the time spent in the dentist’s chair while on vacation. Many people have found medical tourist trips to be well worth the added stress, and now you can add dentistry to that list. If you have no dental insurance, and you don’t want to pay full price, this is definitely a way to do it.

Seek A Dental School

Dental schools can offer dentistry performed by students under the watchful eye of a fully trained professional. To be fair, most of these schools have long waiting lists, so if your dental emergency is immediate, you more than likely will have to pay full price. However, if you can wait to get that bridge done, you might want to apply to the school for treatment. Sometimes they will offer the service based on need or in a lottery system. Either way, the cost of the procedures done in a dental school will be far less than at a regular dentist’s office.

How to Advertise for A Roommate

If you’re not in college anymore, but seeking a roommate, your first question might be: “Where do I advertise?” Online bulletin boards like Craigslist are easy places to start, and they don’t cost anything to advertise. The heading is “rooms/shared” under your major city heading. Other places to advertise are in your local newspaper, and within roommate websites like Roommates.com. In some cases, you may have to pay a fee to advertise, and others will allow you a small period, like a week, to post for free.

Screen Your Potential Roommates

When you advertise, be sure to put in what you desire in a roommate. The best arrangements don’t just need your financial needs, but also take into account your chosen lifestyle. Someone who hates dogs, for instance, may not want to room with you if you have several dogs. The same is true for people who smoke, party, or even have differing religious or political viewpoints. The best match is someone who will appreciate your own lifestyle and endeavor to fit in as seamlessly as possible. The first way to attract such a roommate is to make it clear this is what you seek.

Avoid Being Scammed

Unfortunately, the ease of online communication in searching for a roommate has also led to scammers frequenting these areas, trying to scam you out of money. The paid sites, like Roommate.com, are not as open to such shenanigans, but one still has to be careful. The majority of scams are people who claim to be outside the local area and wanting to rent the room, sight unseen. This should be an immediate warning bell, as the minute they agree to send you money without even meeting you, you know they are setting you up for a scam. They will send out a bad check or money order and then renege on the arrangement, asking you to send them back good money instead.

Some unfortunate would-be renters have also been scammed when genuine advertisements and photos are hijacked and then priced significantly lower than the market price. The scammer hopes to obtain that money by eager renters so eager to score a deal, they will fail to realize they are being scammed. Sometimes, scammers have even cased a good rental, broken in, shown the home to a prospective target, and then taken off with the money. Later, the renters find out the home wasn’t even owned by the person who rented it. This is a good reason why you shouldn’t let people know when you will be home or not. Schedule all viewings only mentioning when it is most convenient to visit, not when you will not be around.

Renting A Room Takes Time

To do this right, expect to take a month or so in the screening process. There will be no-shows and obvious mismatches. Keep looking because eventually you will get someone who is a match. It’s up to you to decide whether you want to run a background or credit check, both of which can be easily done via services available through the Internet. Keep on doing screenings until you have money in your hand, because often people back out because they either find another room or they can’t come up with first and last month’s rent on time.

Get a template for a rental agreement so that your new renter knows their financial obligations and has it down in writing. Everyone should sign. Collect first and last month’s rent, so that your renter doesn’t get tempted to leave you in the lurch without proper notice. If no notice is given, you should make it clear the last month’s rent is non-refundable and only applied when a clear 30 days notice is given. This way, you will have plenty of time to locate your next roommate.

More and more consumers are finding some great deals at their local thrift store. Depending on the store’s policy, you can find either costume or real gold and silver jewelry. In many cases, the jewelry was stuck into clothing by mistake and donated. Most thrift stores make it a point to notify owners when that happens, and the jewelry is returned. Otherwise, if no contact can be made and no one claims it, after a few months it is assumed to be donated and put up for sale. This gives the buying public the opportunity to buy nice jewelry pieces for far less than at retail prices.

Other great finds include antiques. You can find antique dishes and furniture, and sometimes lamps. If you’re not into antiques, people often donate brand new items, still in the box or with tags, because they simply don’t like the purchase, received it as a gift, or are unable to return it to a store. Just because it’s brand new doesn’t mean it’s priced higher. New clothes go for the same as used, and only do some household items get priced a little higher. Yet, you can still get a great deal sometimes for as little as 5 bucks.

Thrift Store Shopping Increased By 35%

Thrift store owners have reported on average a 35% increase in sales. You can blame the economy and the fact that thrift store shopping is now seen as a smart option, rather than only for those with a low-income. Even pawn shops, another place that used to be stigmatized by public opinion, have become more popular too. As people continue to look for ways to save money, thrift store shopping will continue to increase in demand for the foreseeable future.

Disengage When Not In Use

This can mean shutting off the lights when you’re not in a room, or unplugging appliances. Appliances like computers, TVs, and kitchen gadgets have ghost loads that continue to draw energy when plugged in. By getting into the habit of only using items when you need them, you can reduce your electric bill. Get a surge suppressor and plug your appliances into it, then shut them all off at night with one click.

Replace Bulbs With Compact Fluorescents

These bulbs can reduce your energy usage for lights up to 75%. They last 10 times longer than regular incandescent bulbs, keeping you from replacing bulbs as often. They cost more but will end up paying for themselves in as little as six months. They come in small and large sizes, so that you can replace even modern chandelier bulbs with tiny compact fluorescents. Each bulb you replace can save you as much as $30 dollars during the lifetime use. Multiply that by the number of bulbs you replace and you can see that savings really add up.

Replace Your Refrigerator

If your refrigerator was bought in 2001, you can benefit from a newer refrigerator. Newer models are up to 40% more efficient with energy demands, as long as they are labeled “Energy Star.” It can save, on average, about $50 per year as a refrigerator accounts for 15% of your total electric bill. Even though it costs several hundred dollars to replace your refrigerator, check with your state to see what rebates are available for people upgrading their refrigerators to obtain further savings.

Weatherize Your Home

Electric heat can be expensive if your home isn’t properly insulated. It’s an easy thing to determine whether you need more insulation in the attic or the walls. Your windows should be checked for drafts and leaks. Caulk areas that need it. If you can’t replace your windows with energy efficient ones, you can always use plastic thermal window coverings during the winter to reduce the electric bill for as little as $15 for four windows.

Check Your Vents

The number of vents that are open or needed changes from winter to summer. You can shut off an entire room that is not in use in the winter, and save that energy for where it is most needed. If you don’t mind a cold bathroom or basement, shut those vents off and leave the warmth for the rest of the house. Keep vents free from obstruction from furniture and your heating system and filters clean for maximum performance.