Sunday, January 30, 2011

Winterize Your Finances

Now that a new year is upon us and the news years resolutions hopefully are still in progress, its a good time to take some financial inventory. To help keep your "financial machine" well oiled consider the following:

1. Start early gathering up all necessary information necessary to do your taxes.

2. Obtain and review a free copy of your credit report. You are entitled to one free credit report every year. The official online site is Dispute errors in writing -sample letters can be found on the FTC website.

3. If you carry balances on your credit cards develop a plan to pay them in full and then pledge to yourself that you will pay card bills in full every month. If necesary seek the help of a local and reputable non-profit credit counseling organization.

4. Take some time to evaluate your estate plan or develop one if you have none. A simple will may be all that you need and most lawyers charge very reasonable fees to prepare one. Some things that may trigger the need to revise your estate plan include the birth of a new child, getting married or divorced, death of a beneficiary and an increase in your assets.

5. Start building or adding to your "rainy day" fund. Many experts recommend an amount equal to a minimum of 6 months living expenses be kept in liquid, safe investments. With today's uncertainty a full year is even better.

6. Re-evaluate and assess your investment and retirement portfolio with your investment advisor.

7. Set aside $30 dollars so that when you are finished with "winterizing" your finances, you and your spouse or significant other can take in a good movie on a drab winter day.

Tuesday, January 25, 2011

Credit Report Errors: Patience and Persistence

Having errors on your credit report can be a frustrating experience. In today's financial world your credit report is the financial equivalent of your resume. It is one key in enjoying a financially stable life.

In my practice I am getting an increasing numbers of calls about credit report errors. These potential clients often have clear errors on their reports and attribute some type of adverse decision to those errors whether it be a denial of a loan from the local bank or an increase in their insurance. These potential clients want and need help sooner than later.

The problem is that under the Fair Credit Reporting Act, no action can be taken against a credit reporting agency until a dispute letter has been written. Even then, if the error persists, bringing a legal action may not be a good option if legitimatly negative information is on the credit report that arguably caused the problem. Thus, to effectively confront an error on your credit report may require a series of correspondence and also phone calls to establish a clear trail of trying to correct the problem. When a consumer is facing denial of a loan or other adverse action, this may seem like a frustrating requirement - after all they did not cause the problem. However, in the end this documentation not only will satisfy a requirement of the FCRA but also could yield significant damages in the appropriate. Ultimately, the best resolution will be a correct credit report. For some sample dispute letters see the FTC website.