Tough Times

How do we survive in these tough times? For those that are in retirement I hope you saved enough back and feel comfortable with how you have moved your money around. You should have been in a more conservative portfolio when you entered into retirement anyway. But for those of you who are just starting on a savings plan and just entering the work force here is an article I found on Yahoo Finance to help you with building an emergency fund.

An emergency fund is one of the first things you need to have before you start investing. This article shows ways you can save money for an emergency fund.

7 Ways to Sock Away Emergency Cash

by Jeffrey Strain

Monday, August 4, 2008 provided by TheStreet.com

Not having an emergency fund is the first step into the deep hole of debt.
With the economy forcing people to take a hard look at their finances, more people are realizing that they need to create an emergency fund, but how do you find the money to begin an emergency fund when you are just making ends meet?
Here are seven simple ways to find money to begin an emergency fund, which will allow you to create that all-important buffer for your finances.

Rearrange Your Current Costs

The least painful way to create an emergency fund is to rearrange the way you currently spend your money without actually giving up anything.
Chances are that you are paying much more than you need to be for a lot of the services you currently subscribe to such as cable TV, Internet access and phone service.

Calling these services with a competing offer in hand and asking for a better deal will often reduce the amount you are paying while keeping the exact same services you currently get.

The same can be done with home and car insurance as well. It usually costs companies much more money to find a new customer than it does to give you a discount, so they are often willing to give discounts to keep you from going to the competition.
You can then take the money you save to begin your emergency fund.

Play Saving Games

There are a number of saving games that you can play to get your emergency fund started. The most common of these is creating a money jar where you empty all your loose change at the end of each day, and collect the money at the end of the month to use for your emergency fund.

A wide variety of money games like this can serve the same purpose.

Increase Your Income

If you have already tapped all the ways that you know how to save money, another option is to make some extra money.

There are a number of ways that you can accomplish this, including finding a part-time job, doing freelance work or starting your own side business.
You can begin a number of jobs that cost very little money to create, and the extra money gained can become your emergency fund.

Sell Stuff

In all likelihood, you have way more stuff in your home than you need. A simple walk around you home looking into the closets, garage and other storage spaces should readily confirm this.

If you haven't used it in the past year, you probably don't need it. Instead of keeping it in storage and letting it gather dust, have a garage sale, put it up for sale on Craigslist or list it as an auction on eBay.

Set aside any money earned to initiate your emergency fund.

Pay Yourself

The reason that the IRS takes money out of people's paycheck each month is because if they didn't, they know that most people wouldn't have the money to pay their tax bill come April 15. They want to make sure they get their money, so they take it up front.

You should have the same attitude with your emergency fund and pay yourself first when your paycheck arrives. Have a set amount taken out of each paycheck before you pay any other bills that gets transferred into your emergency fund.

Another way to accomplish the same goal is to finish paying off a recurring bill such as a credit card or car payment. Instead of using this newly freed up money to buy new things, keep paying it, but this time to yourself earmarked for your emergency fund.

Set Up an Account

When setting up an emergency fund, you will want to open up a separate account so that the emergency fund money isn't mixed in with your regular spending money since mixing makes it much easier to spend the emergency fund money on non emergency things.

Online banks often offer money promotions for opening accounts, which can get your emergency fund started just for setting it up.

Pay Yourself for Things You Use

One of the easiest ways to always have an emergency fund available is to learn to pay yourself to use things you already own.

Getting into this habit ensures you have a mini emergency fund for all the things you use on a regular basis and puts you in a position of never having to buy things on credit again.

Embrace one of the above ways to begin the emergency fund, and give yourself a bit of breathing room.


Copyrighted, TheStreet.Com. All rights reserved.

Credit Scoring Insurance

I saw this article on insurane scores and did the 'ole cut copy paste so you could see it.

It is the best explination of consumer rating that I have seen for insurance scores in particular the weighting of everything and the the last part on what you can do to improve your scores.

DH

Credit-Based Insurance Score
By Triceiver.com Editors

Many consumers never heard of ‘insurance score,’ and even if they did, they knew very little about it. This is because insurance companies have done an amazing job to keep it as secretive as possible. They rarely mention insurance scores anywhere, even though virtually every company uses it today to help determine whether you qualify for insurance coverage, and at what rate.

Also known as credit-based insurance scores, or insurance risk scores, they are calculated from your financial records collected by the three credit reporting companies. The theory is that there exists a statistical correlation between a person’s credit history and the likelihood of filing insurance claims. In another word, if you have bad credit, you are riskier in the eyes of an insurer. So it is now possible that your car insurance will go up, despite a clean driving record, zero at-fault accidents, and living in a good neighborhood.

This doesn’t seem very intuitive to many people. In fact, two thirds of consumers surveyed by the Government Accountability Office (GAO) didn’t know that bad credit could cost them more in insurance premiums.

However, insurance companies have been arguing that using an insurance score is not only fair, but justified, citing a number of studies that proved a clear correlation between credit history and insurance risks. One particular study published by EPIC in 2003 released some interesting data to support that view. One of the findings in the report is that insurance scores are among the top three risk factors in each of the six automobile coverage studied: No.1 for Personal Injury Protection and Medical Payments, No.2 for Bodily Injury and Property Damage Liabilities, and No. 3 for Comprehensive and Collision Insurance.

As requested by the FACT Act, Federal Trade Commission (FTC) is also conducting studies to evaluate insurance scores. Also there have been increasing efforts from consumer advocates to demand more details from insurance companies and score developers. So the mystery about insurance scores will eventually unfold, but before that day comes, we have been able to gather most information available today, from numerous sources, and present you a detailed and non-biased analysis of insurance scores.

Who develop insurance scores?

There are currently three sources that generate insurance scores:

1. Fair Isaac, the developer of the famous FICO credit scores. They also have different names:Equifax: InScoreExperian: the Experian/Fair Isaac Insurance ScoreTransUnion: the Fair Isaac Insurance Risk Score
2. ChoiceTrust from ChoicePointThere are also multiple scoring models, but the most popular one is ChoicePoint Attract.
3. Individual Insurance CompaniesSome insurers use their proprietary methods, such as Progressive's A24 credit-scoring model and Farmers’ Fire & Auto Combined Evaluation Tool.


What is in an insurance score?

An insurance score takes into consideration many data contained in your credit report. Below is a breakdown of the Fair Isaac Insurance Score model which outlines the importance of each category. Note that the importance may vary slightly for different group of consumers.

Payment History (40%)

Payment information on specific accounts (credit cards, mortgage, car loans, etc.)
Delinquency and how long past duePublic records (bankruptcies, tax liens, judgments, etc.)CollectionsNumber and types of accountsTime since negative marks

Amounts Owed (30%)

Total amount owed on all accounts and on different types of accountsNumber and types of accounts with balancesUtilization rate overall and on specific accountsProportion of installment loan amounts still owing.

Length of Credit History (15%)

Age of oldest account and average age of all accountsAge of oldest account, by type of accountLength of credit historyTime since accounts opened, by specific type of account

New Credit (10%)

Number of recently opened accountsProportion of new accountsNumber of recent “hard inquiries” Time since recent account openings and hard inquiries

Types of Credit Used (5%)

Number and types of accounts, current status, recent information.

What is not in your insurance score?

Anything not in your credit report, plus Soft inquiries (made by yourself, companies for promotion purposes, employer, etc.). Your age, marital status and where you live (these are important factors considered by insurance companies, however) & Your employment information.

How to improve my insurance score and pay a lower premium?

The following tips have proven to be very helpful in raising one’s insurance score as well as credit score, but the key is to manage credit responsibly, and you will see better scores naturally with time.

Check your credit reports periodically and fix any errors immediately.

Go to http://www.annualcreditreport.com/ to get free reports or order them from http://www.myfico.com/ to constantly monitor your records from all three credit reporting companies. Start correction process as soon as possible because it takes time. If you have negative marks that still remain on your report after expiration date, dispute with the credit bureaus.

Pay your bills on time.

Plain and simple, but it is the best advice you can get anywhere. If you are late, don’t wait until the next billing cycle and make the payment immediately, as the time your payment is over due is as important as a late payment itself. Also ask the lender whether they can forgive you by not reporting it to credit bureaus. If this is your first time, they might just agree.

Keep your credit utilization rate below 35%.

This applies to both single account and overall credit limit.

Don’t close old credit card accounts

It will decrease the average age of your accounts. If you have too many credit cards and need to cancel some of them for security reasons, start with the most recent ones and try to allocate the credit lines onto other cards with the same issuer.

Pay down credit card debt

This will not only save you a pile of money, but also increase your credit/insurance score as insurers view credit card debt negatively as compared to other installment loans.

Apply for new credit cards only as needed.

Even though new credit increases your credit limit, this can lower your score in the following months and will significantly damage your insurance score in some models. Opening multiple new accounts in a short time will definitely hurt your score, especially if you have relatively short credit history.

Establish credit history early

Apply for a credit card as soon as you are eligible and make payment on time. Don’t worry about initial credit limit being too low; it will increase over time. If a family member with good credit can add you as an authorized user, it will jump start your credit building process.

Rebuild credit if damaged

If your credit has been damaged by bankruptcy or charge-offs, start the rebuilding process early. Get a secured credit card is a good alternative if you don’t qualify for other regular cards.

Do your rate shopping within a few weeks

If you are applying for a mortgage and need to shop around for better rates, plan ahead and do it within 15 – 30 days. Each time you give permission to a lender to check your credit it will result a “hard pull,” which will lower your score. But scoring models are sophisticated enough to count multiple inquiries of the same type in a short period of time as just one, thus not affecting your score much. Your own inquiries don’t affect your score at all, so there is no need to worry about monitoring your credit activities.

Have mixed accounts of different types

Having a mixture of installment loans (mortgage, car loan, etc.) and credit cards will raise your score, if you manage them responsibly.

Shop around and compare quotes from several insurers

Insurance companies use different models to calculate your insurance score, and they can vary significantly. So shop around before accepting a quote.

Ask about your insurance score

If you see a sizable increase in your premium when renewing a policy, ask whether insurance score played a role. Demand to see your score. You should also ask for a recount if you have fixed certain errors in your credit reports.

Earthquakes, just to keep them in our thoughts.

Study Maps Faults for New York Quakes

08.27.2008

While earthquakes in the northeast United States are smaller and less frequent than in California or Japan, the risks still warrant attention from officials. Even a modest earthquake could wreak millions of dollars of damage on Manhattan.
A magnitude-5 earthquake occurs in or around New York City about once a century, and a magnitude-6 or larger quake occurs once every 670 years, according to a new study. The most recent magnitude-5 or larger was in 1884.
Researchers at Columbia University mapped out a family of faults after analyzing 383 quakes around New York City from 1677 to 2007. A previously unidentified boundary runs 25 miles to Peekskill, N.Y., from Stamford, Conn., passing within a mile of Indian Point nuclear plant.
Copyright 2008 The New York Times Company. All Rights Reserved.
New York City may seem immune to earthquakes, at least compared with its West Coast megacity counterpart, Los Angeles. But there is some danger.
A new analysis of 383 quakes in a 15,000-square-mile area around New York City estimates that a magnitude-5 earthquake in or around the city occurs on average once a century, and a magnitude-6 or larger quake occurs once every 670 years. An even larger magnitude-7 is estimated at once every 3,400 years.
Researchers at the Lamont-Doherty Earth Observatory at Columbia University analyzed earthquakes that occurred from 1677 to 2007 as well as data gathered by seismic instruments in the past 34 years and mapped out a family of faults responsible for most of the earthquakes. Their report appears in the current issue of the Bulletin of the Seismological Society of America.
''We now have some way to look at the geology and use it to map the hazards,'' said Leonardo Seeber, a senior researcher at Lamont-Doherty and one of the study authors.
The historical record includes three earthquakes of magnitude-5 or larger, the most recent in 1884. That quake originated offshore near Coney Island and toppled chimneys in the city.
While earthquakes in the northeast United States are smaller and less frequent than in places like California or Japan, the risks still warrant attention from officials, the researchers said.
''New York City is a major concentration of people and buildings, so if you combine the rate of earthquakes with what is there to be damaged, that combination becomes relatively high,'' said John Armbruster, another study author. ''There's a lot to be damaged. A magnitude-5 earthquake under Queens is going to be much more damaging than a magnitude-5 earthquake in upstate New York.''
Lynn R. Sykes, an emeritus professor of earth and environmental sciences at Columbia and the lead author of the study, said critical facilities needed the most attention. That includes schools, fire stations, bridges -- and the Indian Point nuclear power plant 24 miles north of the city. The study found a previously unidentified boundary, likely a fault, that runs 25 miles to Peekskill, N.Y., from Stamford, Conn., passing within a mile of Indian Point.
With the new data, engineers could better analyze what types of forces the plant might experience in an earthquake along that fault. The owner, Entergy, is seeking to extend its operating licenses of the two reactors at Indian Point by 20 years.
Even a modest earthquake could wreak millions of dollars of damage on Manhattan. And, surprisingly, the lack of large earthquakes makes the smaller earthquakes potentially more damaging. In places like California, the many earthquakes have weakened the top layers of crust, making for less buildup of strain and less powerful quakes near the surface. Thus, the most damaging earthquakes usually originate 5 to 10 miles underground.
In the New York area, most earthquakes are much shallower, within three miles of the surface. A shallow earthquake shakes the surface more violently than a deep one of the same magnitude. Mr. Seeber said a recent magnitude-2.3 earthquake near Warwick, N.Y., shook items off shelves, and there were reports of damaged foundations.
Stiffer rocks in the New York area also transmit farther the higher-frequency vibrations that shake objects harder. ''These very shallow earthquakes can deliver a big punch even though very small,'' Mr. Seeber said.
The Appalachians Mountains were first pushed up several hundred million years ago, and those ancient large faults, including the Ramapo fault that also passes near Indian Point, have been quiet. The earthquakes have instead occurred along smaller faults running perpendicular to the older faults.
PHOTO: HAZARD: What is thought to be a fault runs near the Indian Point nuclear plant, 24 miles north of the city. (PHOTOGRAPH BY SUZANNE DECHILLO/THE NEW YORK TIMES)
Document NYTF000020080826e48q0001b
____________________________________© 2008 Factiva, Inc. All rights reserved.Science Desk; SECTFStudy Maps Faults for New York Quakes By KENNETH CHANG 658 words26 August 2008The New York TimesLate Edition - Final3English

Buyer Beware of "Counterfit Electrical Products"

I ran across this recently along with a really neat video of counterfeit electrical cords. One day I will learn how to put video on this blog but for now you'll just have to read what I find.

Here's the article. You can click on the above link and try to find the video yourself too or you can try this link to the Consumer Product Safety Commission. http://www.cpsc.gov/

David

The Electrical Safety Foundation International (ESFI) encourages you to be more proactive in safeguarding your family and home from dangerous electrical products.


Here are the top 5 things you can do to avoid hazardous electrical products:

1) Avoid buying electrical products from deep discount stores. Many consumers unknowingly purchase counterfeit electrical products. Knock-off extension cords, decorative lights, receptacles, hair dryers, irons, toasters and hundreds of other consumer products have caused shocks, electrocutions and fires. These products are missing key safety features and are often found at deep discount stores, flea markets, and on similar online forums


2) Make sure that your home has Ground Fault Circuit Interrupters (GFCIs) and that they are working. GFCIs are special outlets that recognize when electricity is leaking from an electrical product and then cut power to that product in milliseconds. GFCIs have been credited for saving thousands of people from electrocution over the last three decades. If GFCIs were installed in all homes, experts suggest that 70 percent of the approximately 400 electrocutions that occur each year in the home could be prevented.


3) Use extension cords appropriately. No joke…this is an issue. CPSC estimates that about 2,000 people are treated each year for injuries associated with extension cords. Remember that extension cords are designed for temporary use only. Do not run them under furniture or rugs. Replace cracked, worn or frayed extension cords with new ones.


4) Use the appropriate wattage of light bulb. Want a brighter room? Just grab a higher wattage light bulb, right? Wrong! A bulb of too high wattage or of the wrong type may lead to fires. Some ceiling fixtures and recessed lights even trap heat.


5) Let common sense be your guide. Altering plugs or cords and using electrical products close to water are recipes for disaster.

If you ever have any questions or concerns about an electrical product, call the manufacturer or qualified service professional.

KY helps with Roadside assistance

FYI

Keep this number in your car and you can phone them 365 days a year, 24 hours a day in KY

1-877-FOR- KYTC
1-877-367-5982

They will send someone to you if you are stranded on an interstate or parkway in KY. FREE!

You could call the number for a state highway and they would get a trooper to you if need be but that's all. They will not tow or pay for a tow but will help with all they can at the scene even calling the tow service for you. They will help change tires and other emergencies on the side of the interstate as they are aware of how dangerous it is to be on the side of a busy road doing that kind of thing by yourself.

Good to know your tax dollars are at work!

Article on CD's

I saw this interesting article in the AAII (American Association of Individual Investors) Journal.

Just informative for someone learning how to invest and information on a conservative investment.

State Farm Bank offers very competative interest rates on CD's so check with us each week to see what they are.


Certificates of Deposit

A certificate of deposit (CD) is an interest-paying savings vehicle. A CD has a stated maturity date, a specified interest rate and can be issued in any denomination by commercial banks, thrifts and credit unions.

How It Works

A certificate of deposit is a promissory note issued by a bank, thrift institution or credit union. It is a time deposit, meaning the institution keeps your money for the stated time and you are restricted (in the form of a penalty) from accessing the money prior to the maturity date.
This type of investment is less liquid than a cash deposit such as a checking or money market account. Because of this, interest rates are usually higher compared to cash deposit rates. If you must access the money before maturity, you will pay a penalty (typically a loss of interest payment over a certain period), which will eat into your total return.
A typical CD can be purchased for any amount and has a number of time period options. The most popular are between three months and five years. Usually, a longer holding period means a higher interest rate. CDs are insured by the FDIC up to $100,000.

Types

There are numerous types of CDs meeting most any investor’s holding period, interest rate and initial investment needs.
Traditional CDs, which most people are familiar with, allow you to deposit any amount of money, at a predetermined rate for a fixed time period. CDs with an initial investment of less than $100,000 are called small CDs. These are typically purchased by individual investors.
CDs with initial purchases of more than $100,000 are called jumbo CDs. These are usually purchased by institutional investors such as pension funds.
A bump-up CD gives you the option to increase the interest rate on your investment if the bank has increased the rate after you bought your CD. For example, if you bought a three-year CD at 5% and one year later the bank raises the rates on three-year CDs by 0.5%, you have the option to get the higher rate (5.5%) for the remainder of the term. Typically you have the option to do this only once during the holding period and the initial rate on the CD might be lower than a traditional CD rate to reflect this option. This can be a good option if you expect rates to rise substantially in the future.
A liquid CD allows investors to withdraw money without a penalty. Most banks will require a minimum balance over the life of the CD. Banks can also set a first penalty-free withdrawal date whenever they like, so you still may not be able to take out money right away. Also, there might be a limit to the number of withdrawals you can make over the CD term. The interest rate will typically be higher than a cash deposit account, but lower than a similar term traditional CD.
Zero-coupon CDs are very similar to zero-coupon bonds. You buy a CD at a deep discount to par, which is the amount you will receive at maturity. The coupon payments refer to the interest payments, so a zero-coupon CD will not earn interest. Your return depends on how much the initial investment is discounted from its par value.
Callable CDs allow a bank to call back a CD after the call-protection period expires, but before its maturity. In this case, the bank is attempting to shift interest rate risk to the investor. If rates fall, they can call any CDs with higher interest rates, and reissue them at the lower rate. There is typically an interest rate premium for investors purchasing this type of CD.
Brokerage CDs are sold through a brokerage firm. They often pay higher rates and are more liquid because the broker creates a secondary market. [For more detailed information about brokerage CDs, see the Offbeat Offerings column in the May 2007 AAII Journal.]

How to Trade

You can purchase a CD through any bank, thrift or credit union, and some brokerage firms. With the popularity of on-line banking, you have more options and more competitive rates. Your neighborhood bank may offer a rate that is more than it offers on a cash deposit, but typically an on-line bank can offer an even higher rate. This is because they do not have the costs associated with running brick-and-motor branches.
Investing in a CD at a bank or on-line is easy. After filling out the requisite paperwork, you can send the bank the money either via check or E-transfer from one bank to another. After the CD matures, the bank will typically transfer the money to a chosen account, or will roll it over into another CD.

Investor Suitability

Putting your cash reserve in a CD can earn you more interest than using a cash deposit account.
A more sophisticated way to invest in CDs is through laddering. Interest rates rise and fall as the economy ebbs and flows, and most investors do not want to get stuck in only low-interest-rate-paying CDs as rates are rising. One way around this dilemma is to ladder, spreading the maturity of your CDs over various timeframes. This technique assumes that longer-term CDs are almost always offered at a higher rate than shorter-term CDs.
As an example of a five-year ladder, with $20,000 to invest, you would invest $4,000 (or $20,000 ÷ 5) in each ladder “rung,” with the rungs consisting of one-, two-, three-, four-, and five-year CDs. After the one-year CD matures, it is rolled over into a new five-year CD (because after one year passes, each remaining CD has one year less until maturity). This will continue as long as you decide is appropriate.
By replacing the longest maturity CD each year, you will be getting a higher rate and if rates are rising, you will not be stuck in a long-term CD and unable to earn the higher rate.

Tax Consequences

For all CDs, you are taxed on any interest earned. Zero-coupon CDs are taxed on “phantom income” even though the actual interest is not paid to you. Your bank will send information about your interest earnings for tax purposes each year.

The Pros

Safe InvestmentsCDs are insured by the Federal Deposit Insurance Corp. (FDIC), for banks, and the National Credit Union Administration (NCUA), for credit unions. They are guaranteed to return the agreed upon rate over the CD term. [Make sure you understand the rules for FDIC and NCUA insurance coverage to ensure your CDs are fully covered.]
Higher Rate Than Cash DepositsBecause you do not have immediate access to the cash, banks typically offer a higher interest rate on CDs than on traditional cash deposits.

The Cons

LiquidityMost CDs do not have liquidity without penalty. If you withdraw the money before maturity, you will be heavily penalized.
Interest Rate RiskBecause you are locking in an interest rate, you may miss out on higher rates if interest rates rise. The longer the CD term, the higher the risk that your original rate will be lower than the going rate before it reaches maturity.
Low ReturnCompared to other riskier investments such as stocks, the returns can be very low.

Additional Information

BankRate.comwww.bankrate.com BankRate.com offers a wealth of information on CDs. The CDs & Investments section includes frequently asked questions, national CD rate comparisons, recent news stories and commentaries about the CD market, calculators and more. All of the data is free and updated regularly.
SECwww.sec.gov/investor/pubs/certific.htm The SEC offers tips on choosing and researching CDs. Cara Scatizzi, AAII Associate Financial Analy
By Cara Scatizzi, AAII Associate Financial Analyst

Dog Bites!

An interesting Article off the News Hub...

Study Shows Dog Bite Claims Up, Totaling More Than $350 Million in 2007



07.11.2008

Dog bites now account for a third of all homeowners insurance liability claims, costing $356.2 million in 2007 – or 10 percent more than the year before, according to the Insurance Information Institute (III).

The average cost of dog bite claims increased by 11.5 percent last year to $24,511, according to an III analysis. Since 2003, the cost of these claims has risen nearly 28 percent. However, the actual number of claims paid by insurers has remained relatively stable over the past three years at about 14,500.

More than 4.7 million people are bitten by dogs annually, resulting in an estimated 800,000 injuries that require medical attention, according to the Centers for Disease Control and Prevention. With more than 50 percent of bites occurring on the dog owner's property, the issue is a major source of concern for insurers.

"While the number of dog bite claims has remained about the same in the last three years, the average cost per claim continues to rise because of increased medical costs as well as the size of settlements, judgments and jury awards which have risen well above inflation in recent years," said Loretta Worters, III vice president.

Dog Owner Liability

According to III, dog owners are liable for any injuries their pets cause if:
The owner knew the dog had a tendency to cause that kind of injury.
A state statute makes the owner liable, whether or not the owner knew the dog had a tendency to cause that kind of injury. The injury was caused by unreasonable carelessness on the part of the owner.

There are three kinds of law that impose liability on owners:

1) Dog-bite statute: The dog owner is automatically liable for any injury or property damage the dog causes, even without provocation.

2) "One-bite" rule: In some states, the owner is not held liable for the first bite the dog inflicts. Once an animal has demonstrated vicious behavior, such as biting or otherwise displaying a "vicious propensity," the owner can be held liable.

3) Negligence laws: The dog owner is liable if the injury occurred because the dog owner was unreasonably careless (negligent) in controlling the dog.

In most states, dog owners are not liable to trespassers who are injured by a dog. A dog owner who is legally responsible for an injury to a person or property may be responsible for reimbursing the injured person for medical bills, lost wages, pain and suffering and property damage.

Coverage for Dog Owners

Homeowners and renters insurance policies typically cover dog bite liability. Most policies provide $100,000 to $300,000 in liability coverage, according to III. If the claim exceeds the limit, the dog owner is personally responsible for all damages above that amount, including legal expenses. Most insurance companies will insure homeowners with dogs. However, once a dog has bitten someone, it poses an increased risk, and insurance companies may charge a higher premium or exclude the dog from coverage. Some insurers require dog owners to sign liability waivers for dog bites. Some will cover a pet if the owner takes the dog to classes aimed at modifying behavior.

Because a single lawsuit can end up costing hundreds of thousands of dollars and exceed the level of personal liability coverage available through a standard homeowners policy, III advises homeowners to consider purchasing a personal excess liability policy, otherwise known as an umbrella liability policy.
____________________________________
© 2008 Factiva, Inc. All rights reserved.

FYI:
The average cost of dog bite claims increased by 11.5 percent last year to $24,511.

State Farm’s Numbers:

State Farm® paid $84.6 million in dog bite claims last year, which is up compared to the previous four years, when payments ranged from $74 to $78 million. However, the number of paid claims in 2007 – about 3,500 – is about the same as in 2006 and down slightly from previous years. For example, the number of dog bite claims in 2003 was 4,000.

State Farm’s Policy:
State Farm does not refuse insurance based on the breed of dog. We believe there are good dogs and bad dogs within every breed, just as there can be responsible and irresponsible owners of each breed. Under the right circumstances, any dog might bite. However, the state of Ohio determined last year that pit bulls meet the definition of a ‘vicious dog.’ The owners of pit bulls or any American Staffordshire Terrier mix in that state are subject to specific requirements to protect the public from injury. State Farm believes it is in the best interest of its policyholders not to provide coverage under its homeowners policy in Ohio for this breed of dog.

Dog Bite Prevention Tips:

Consult with a professional (veterinarian, animal behaviorist or responsible breeder) to learn about suitable breeds of dogs for your household and neighborhood.

Spend time with a dog before buying or adopting it. Use caution when bringing a dog into a home of with an infant or toddler. Dogs with histories of aggression are inappropriate in households with children.

Be sensitive to cues that a child is fearful or apprehensive about a dog and, if so, delay acquiring a dog. Never leave infants or young children alone with any dog.

Have your dog spayed or neutered. Studies show that dogs are three times more likely to bite if they are not neutered.

Socialize your dog so that it knows how to act with other people and animals.

Discourage children from disturbing a dog that is eating or sleeping.

Play non-aggressive games with your dog, such as "go fetch." Playing aggressive games like "tug-of-war" can encourage inappropriate behavior.

Avoid exposing your dog to new situations in which you are unsure of its response.

Never approach a strange dog and always avoid eye contact with a dog that appears threatening.
Immediately seek professional advice if the dog develops aggressive or undesirable behaviors.

Are you on track for Retirement?

I just recently saw this in Money Magazine. I thought it was worth sharing.

The amount you need to have saved varies based on your age. Look at this worksheet to see where you stand. Remember this is only a guide. Don't get to bigheaded if your doing good but don't get to down if you are lagging behind.

If you are age: Enter your current income Savings amount should be

45 $................................. X 4.1 = $..........................

50 $................................ X 6.1 = $..........................

55 $................................. X 8.5 = $..........................

60 $................................. X 11.4 = $..........................

"I find the great thing in this world is not so much where we stand, as in what direction we are moving: we must sail sometimes with the wind and sometimes against it – but we must sail, and not drift, nor lie at anchor."

-- Oliver Wendell Holmes

Thinking about your retirement? Planning is essential. If you fail to plan, you plan to fail.

Do something, don't lie at anchor. Move forward when you have made your plan and stay diligent on it. I love the word diligent. It means to faithfully apply yourself by steady, earnest, and energetic effort.

If you do that for your retirement you will succeed.

Call me for any questions at 859-734-5338.

David

New Child Passenger 5 Star Saftey Rating System

We seldom get questions on car seats but I found this article helpful. I hope you will too. If you have children or grand children or have friends with children they may find this article useful. Feel free to e-mail it with the link below.

Parents - Not Sure Which Car Seat to Use?Are you looking for a new car seat for your infant, toddler or 4-8 year old child but overwhelmed by the choices and worried about how to properly install your car seat?

Use the New Five-Star Ease of Use RatingsNHTSA now provides parents a new five-star ratings system that allows you to evaluate how easy certain car seat features are to use before you buy a seat.

Are All Seats Safe?All car seats rated by NHTSA meet Federal Safety Standards & strict crash performance standards. While all rated seats are safe, they do differ in their ease of use in four basic catagories:

Evaluation of Instructions
Vehicle Installation Features
Evaluation of Labels
Securing the Child

NHTSA Ease-of-Use 5-Star RatingsNHTSA uses a five-star rating system to help consumers evaluate the four basic category ratings:

= Excellent features on this child restraint for this category.

= Above average features on this child restraint for this category.

= Average features on this child restraint for this category.

= Below average features on this child restraint for this category.

= Poor features on this child restraint for this category.

N/A= Does not contain any features that require a rating.

Simply click on the type of car seat you are buying and find the NHTSA ratings for:
Infant RearFacing Seat
Toddler ForwardFacing Seat
Convertible Seat
Child Booster Seat

It Must Fit Right To Work RightRemember, the best car seat is the one that fits your child properly, is easy to use, and fits in your vehicle correctly.

Get Your Car Seat Checked for Free. Be certain you've installed your car seat correctly by having it checked at an inspection station or by a certified child passenger safety technician.
Find a local inspection station - Click HERE.

For more information on NHTSA's Ease-of-Use Ratings, click HERE.
For additional information on child restraint systems click HERE.
For guidelines in using Ease-of-Use ratings in advertising and communications click HERE.

Social Security Retirement benifits by year of birth

In visiting with several clients recently about their retirement and helping them plan for it, they have asked about their social security benefits and when they will begin. I have attached the above link to show what ages you can start receiving SS benefits. You can begin getting benefits at age 62 but they are reduced based on your age anywhere from 20% to 30%. Look at the SS site and your year of birth to find out the age you can retire and maximize your SS benefits. If maximizing those benefits is not a concern you could retire earlier.

My additional suggestion is to contribute to your 401k if your employer offers one and then look at additional retirement plans such as a Roth IRA through our office. Whatever your employer offers as a match put that full amount in. If they match 1% put in 1%, if they match 3% put in 3% (that would give you a 100% return based on the employer matching the amount you put in and that's really hard to beat!). After that match is complete then venture out to the Roth IRA with us. With the laws that apply to the Roth IRA still in place, withdrawal of this money will be tax free when you begin retirement withdrawals from it.

If your self employed or your employer does not offer retirement plans then let's start with a Roth IRA. Come see me soon!

Boomers' Eagerness to Retire Could Cost Them

Boomers' Eagerness to Retire Could Cost Them
01.15.2008

© 2008 USA Today. Provided by ProQuest Information and Learning. All Rights Reserved.

They're known as one of the most rebellious generations in U.S. history, not to mention the largest. This year, the oldest of the 79 million baby boomers born from 1946 through 1964 turn 62, which means they become eligible for Social Security. The boomers - projected to live longer than any previous generation of Americans - will have the longest retirements, too.
Can they afford to retire? How far will their Social Security checks go? The reality is this: Many of those who retire early will accept reduced benefits - and in doing so will risk falling short of their financial needs.

So What Will This Generation of Retirees Do? About half of the soon-to-be-62-year-olds are expected to do just what their parents generally did: file for Social Security benefits at the youngest possible age, in exchange for a smaller benefit than they'd get if they waited to retire at 66. Many are relying on conventional wisdom that suggests they're better off filing for Social Security as soon as possible. Yet if they follow that advice, millions of the oldest boomers may be about to make a colossal error -- one that would be magnified by their record-setting longevity.

Over time, taking benefits early could mean a smaller payout, hefty taxes on their retirement savings and a heightened risk of outliving their money. In fact, the roughly 50% of the oldest boomers who the Social Security Administration estimates will tap their benefits starting this year will absorb a permanent 25% cut in benefits. Up to three-quarters of them are expected to file for benefits before age 66, their full retirement age. How much their benefits will shrink depends on how close they are to full retirement age once they begin to take those benefits.

Now consider those who wait till after age 66: They'll enjoy an 8% annual increase in benefits until age 70. (After that, there's no advantage to delaying benefits.) Yet on the most fateful financial decision most of them will make, only about 5% of retirees wait until after they've reached full retirement age to claim benefits. And it's a trend that's likely to persist, says Stephen Goss, chief actuary for the Social Security Administration.

Many retirees who plan to start taking their benefits early assume it won't make much difference over time. One of them, John McGinnis, 61, an insurance claims manager in Jacksonville, plans to file for Social Security next year. "I'm going to take them at the reduced rate, figuring I should live long enough that it will even out to my advantage," McGinnis says.
In reality, boomers who live the longest stand to lose the most by taking benefits early, according to an analysis by the American Academy of Actuaries. Retirees who file for Social Security at age 62 and live into their mid-90s could lose nearly $150,000 in benefits, says Ron Gebhardtsbauer, senior pension fellow with the academy.

Among the factors that could hurt boomers who take early Social Security benefits at age 62:
Longevity.

Laurie Ditzel, a retired teacher in Fairport, N.Y., turned 62 on Jan.5. Most of her older friends filed for benefits once they turned 62. Her own inclination, though, is to wait.
In part, that's because Ditzel, who's also a nurse, might return to work at some point. Under the law, Social Security beneficiaries who haven't reached full retirement age are subject to an "earnings test." It cuts their benefits by $1 for each $2 they earn over an annual limit. In 2008, that limit is $13,560. That's not the only reason Ditzel says she probably won't file for benefits this year. She also realizes that her retirement income might need to last for decades. An avid traveler and member of a crew team, Ditzel is in excellent health. "At the moment, I don't really need the extra income, and I'm thinking if I live to be 90, I'll be glad to have the higher (benefit) rates," she says.

In fact, there's a 41% chance that a 62-year-old woman today will live to 90; a 62-year-old man has a 29% chance. For a married couple, there's a 58% chance that one of them will live to 90 and a 29% chance that one will reach 95.

The Social Security Administration projects that the average retiree's "break-even" age for Social Security benefits is 77. A retiree who dies before then would have fared better by taking benefits at 62. Those who live past 77 would earn more by delaying benefits. Retirees who take reduced benefits at 62 and live to 90 would lose $39,000 in benefits; those who live to 95 would give up $54,000, the SSA says.

But some financial analysts say your losses would be far greater than that. If, for example, you include the annual cost-of-living increases that boost Social Security checks, Gebhardtsbauer's estimate of how much you'd lose by taking benefits early far exceeds the SSA's: $83,000 for those who take benefits at 62 and live to age 90 and nearly $149,000 for those who live to 95.
Gebhardtsbauer sets the break-even age a bit higher than the SSA does. That's because he takes into account interest earned by those who take benefits starting at 62. Even so, by including the annual cost-of-living increases, he calculates even more value in delaying benefits. The reason: The cost-of-living adjustments will apply to a larger sum.

Thanks to compounding, "those cost-of-living adjustments will be huge, especially if you live long in retirement," says James Mahaney, a retirement specialist at Prudential Financial.
Even if you're convinced you won't live so long, taking your benefits early could hurt your spouse. When a married beneficiary dies, the survivor can continue receiving his or her own benefit or the deceased spouse's benefit, whichever is more. So spouses who take their benefits early don't just shrink their own payouts; they also reduce the amount the surviving spouse will be eligible for.

Taxes.

Analysts generally urge retirees to delay withdrawing money from their 401(k), IRA and other retirement savings accounts as long as possible. That way, the thinking goes, the tax-deferred investments can grow and compound. But that advice, Mahaney says, ignores the punishing effect of taxes on Social Security benefits. If all your income comes from Social Security, your benefits usually aren't taxable. But retirees with other income, including withdrawals from most retirement plans, could owe taxes on a huge chunk - 50% to 85% - of their benefits. The tax was originally designed to target wealthy seniors. But because the income thresholds weren't indexed to inflation, the tax has spread to middle-income retirees.
Married couples with $32,000 in combined income face taxes on half their Social Security benefits.

Couples with a combined income of at least $44,000 could owe taxes on 85% of their benefits. (For the purposes of the tax, combined income includes half of a retiree's Social Security benefits, wages from a job, pensions and withdrawals from most retirement plans.)
The phenomenon has been termed a "tax torpedo." Yet for some retirees, it will more closely resemble an intercontinental ballistic missile. "People are going to be walloped," Mahaney says.

How can retirees avoid this nightmare? By using their retirement savings to pay living costs in the early years of retirement, Mahaney says, and then taking their Social Security benefits later. Those who do so will give up some tax-deferred investment gains. But in the long run, Mahaney says, it'll pay off: "It makes no sense to be creating more and more (tax-deferred) dollars that are going to be taxed at higher and higher rates."

To illustrate, Mahaney compared two hypothetical retired couples. Both have pretax income of $69,000. But the first couple has Social Security income of $24,000 and IRA income of $45,000. The second has $39,000 in Social Security income and $30,000 from an IRA.
Both couples will pay taxes on their Social Security benefits. But because the first couple has a larger IRA withdrawal, a bigger slice of their benefits will be taxed. The result: The first couple will pay more than $8,900 in federal and state taxes. The second couple? Only about $4,700.

A Bird in the Hand

Despite the lure of larger benefits, many retirees can't resist passing up the opportunity to file at 62, in part because they're worried about the future of Social Security.
Eddie Papps, 61, an independent contractor who has lived all over the USA and is currently working in Sarajevo, Bosnia-Herzegovina, plans to retire next year. He and his wife will receive small pensions.

Papps also has savings from his 401(k) plan. Papps says he doesn't really need Social Security income. But he plans to start taking his benefits next year anyway, just to be safe.
He says he thinks Congress will act to shore up Social Security, perhaps by cutting future benefits. But he believes those cuts won't affect people already receiving benefits. Therefore, "I'm not going to take a chance by waiting until I'm 65."

Robert Little, 61, a systems analyst in Philadelphia, feels the same way. He plans to retire from his full-time job this year so he can volunteer at the Philadelphia Zoo and spend time with his grandchildren. And he plans to file for Social Security this year, even though he knows his benefits will be reduced. "No matter who gets in the next (presidential) administration, they're going to be attacking Social Security," he says.
"It's better to be on the rolls, because there's less of a likelihood they'll do damage to those already getting it."

Unless Congress acts, by 2017 Social Security will start paying out more in benefits than it receives in tax revenue. By 2027, it will have to tap its trust fund to pay benefits. And by 2041, Social Security will be able to pay only about 75% of promised benefits, according to the agency's report to Congress. But the 79 million people born from 1946 through 1964 represent an extraordinarily potent voting bloc. Reducing their benefits "would be a huge political burden," Prudential's Mahaney says. He thinks lawmakers are more likely to raise payroll taxes on workers than reduce benefits for retirees.

David Certner, director of federal affairs for AARP, doesn't think that retiring boomers will suffer cuts in benefits, either. "We think Social Security benefits, particularly for those at or near retirement, are well-financed and will be there," he says.

Some Don't Have Option to Wait

Yet even if retirees are convinced their benefits are safe, most of them, Certner predicts, will continue to file claims before full retirement age. Many who are in poor health or have been pushed into early retirement don't have the option of waiting until 66 to file for benefits, he notes. "For millions, (Social Security) is basically their only source of income," Certner says. "We don't see that changing much."

And even though many analysts say boomers could bolster their financial security by working longer, employers don't always comply. Some companies dangle incentives to induce older employees to leave.

Peter Wagner, 61, who lives outside Kingman, Ariz., retired last year after his employer, Frontier Communications, offered him an incentive to retire before age 65. "It wasn't exactly a golden parachute," he jokes. "It was kind of bronze." Social Security benefits, which he plans to start receiving this year, will supplement his savings and buyout package, he says. Wagner's wife, Gail, died in December at age 53. Her death, he says, has reinforced his determination to enjoy the time he has left. "I'm doing all the things I like to do," says Wagner, an avid hunter and fisherman. "I've got over 20 acres and all kinds of projects I've been trying to do for years."
Even with early-retirement incentives from their employers, boomers who stop working risk running out of money -- a risk that could escalate if they take Social Security benefits early.
But that's a chance that many older boomers seem willing to take.

"The bottom line is, people would still prefer to retire than work," Certner says. "People can't wait to get to age 62 and get out."

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____________________________________© 2008 Factiva, Inc. All rights reserved.NEWSBoomers' eagerness to retire could cost them ; Filing for Social Security at 62 raises risk they'll outlive their money Sandra Block 2139 words14 January 2008USA TodayFINALA.1English

Insurers Get Behind Grants for Code Enforcement

01.04.2008
Copyright 2007 (c) A.M. Best Company, Inc. All Rights Reserved.
WASHINGTON (BestWire) -

State and local building departments would be eligible for up to $100 million in dedicated federal funds over the next five years, under insurance industry-supported legislation introduced in both chambers of Congress.

Sponsored in the U.S. House by Rep. Dennis Moore, D-Kansas, and in the Senate by Sen. Mary Landrieu, D-La., the Community Building Code Administration Grant Program would offer awards of up to $1 million for development and implementation of building codes, hiring and training of code officials, and other code enforcement activities.

The legislation requires grant recipients match at least a portion of the funds received, and calls on the Department of Housing and Urban Development to administer eligibility tests and ensure that governments in financial distress are given preferential treatment.
In introducing the bill, Landrieu said her interest was that Gulf Coast communities still recovering from hurricanes Katrina and Rita have the funds necessary to ensure compliance with upgraded home and building safety standards. According to a 2005 study from the National Institute of Building Sciences, U.S. taxpayers save $4 in disaster assistance costs for every $1 of federal funds spent on mitigation.
"Currently, no federal funds are designated for building code administration, and as a result, there is widespread lack of enforcement, presenting a major threat to public safety," Landrieu said.

The measure is the second significant bill introduced in Congress in recent months proposing an expanded federal role in state building code activities. In October, Reps. Doris Matsui, D-Calif., and Mario Diaz-Balart, R-Fla., introduced the Safe Building Codes Act, which would offer incentives to states that enact building codes, including 4% more in disaster relief funds for states that make the codes mandatory and implement enforcement mechanisms.
Like the earlier measure, Moore and Landrieu's bill has earned support from property/casualty insurers and their trade associations, including the American Insurance Association and the National Association of Mutual Insurance Companies.

"This legislation is vital to enhance and promote safer homes and businesses, especially in areas vulnerable to natural catastrophes," Justin Roth, NAMIC's senior federal affairs director, said in a statement. "Stronger building codes are key to protecting lives and property."

Moore's version of the bill, H.R.4461, has been referred to the House Financial Services Committee. Landrieu's version, S.2458, is before the Senate Banking Committee.
(By R.J. Lehmann, Washington bureau manager: raymond.lehmann@ambest.com)
BN-NJ-12-19-2007 1627 ET #
111030

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____________________________________© 2007 Factiva, Inc. All rights reserved.Insurers Get Behind Federal Grants for Code Enforcement 423 words19 December 2007Best's Insurance NewsEnglish