Trick or Treat!?

This week’s CBTV show is entitled, “Is Your Financial Advisor a Trick or Treat? The Truth About Some of the Bad Apples Out There!”

The U.S. Department of Justice recently released the United States Attorneys’ Annual Statistical Report for Fiscal Year 2010, which revealed an 8% increase in the number of “white collar” financial fraud cases.  It was also reported that “white collar” fraud made up a greater percentage of overall criminal cases in 2010 at 9.4%. The good news, is that of all the cases prosecuted in 2010 by the U.S. Attorneys’ office, the conviction rate was an astounding 91%!  More than 1,500 defendants were convicted of a financial crime during fiscal year 2010, for crimes ranging from Ponzi schemes, to mortgage fraud, securities fraud, and quite a few others. 

“White collar” crimes are defined as “non-violent” crimes, committed by an individual or group, for financial gain.  Typically, white collar criminals pose as professionals and have knowledge of financial policies and investments.  In an effort to prosecute these criminals, the federal government has enlisted the Offices of the U.S. Attorney General to serve as the nation’s principal litigator and “chief federal law enforcement officer.”  They prosecute the federal financial fraud cases that are reported to the Securities and Exchange Commission or those investigated by the FBI.  In their Fiscal Year 2010 Annual Report, they revealed that white collar criminal cases involving lending and investment frauds were on the rise in 2010.  Fortunately, they closed nearly 6,000 cases throughout the year, with nearly 8,000 defendants convicted, and almost two-thirds of them being sentenced to prison.

The Federal Trade Commission (FTC), who is responsible for protecting consumers from fraud, deception and unfair business practices, recently released its annual list of top consumer complaints for 2010.  “Imposter scams” made the top 10 list for the first time.  These scams take place when imposters pose as friends, family members, respected companies or government agencies, and convince consumers to send them money.  The FTC received over 1 million consumer complaints in 2010, and 4% of those were imposter scams.  One particular imposter scam is taking advantage of senior citizens, and is known as the “grandparent scam,” with scammers posing as grandchildren in dire need of financial help.  Another type involves homeowners struggling to avoid foreclosure, with scammers offering to secure a mortgage loan modification for a fee.  “Texting” scams have also become quite popular, with the victim receiving a text message on their cell phone, which says that one of their bank accounts is frozen, and they need to call a number and reveal their account information. 

White collar crimes are a real concern for everybody today, particularly those older Americans who are struggling financially.  The federal government has tried to put an effective consumer protection system in place to fight financial fraud, using organizations such as the SEC, the FBI, the FTC, and the U.S. Attorney Generals Office.  But they can only do so much, and they really can’t help victims who don’t file a complaint. The FTC conducted a random telephone survey a few years ago and found that only 8.2% of victims actually reported these crimes.  That means more than 90% of all victims are not taking any action! So the real key here, is to be vigilant whenever you’re approached with any investment opportunities that seem “too good to be true,” and question everything. The fact of the matter is, there are a lot of bad apples out there, so be sure you investigate them thoroughly, before you take a big bite out of any one of them!

To help you in selecting the very best financial advisor you can find, be sure to log on to our website and download our FREE report, “10 Questions to Ask Your Financial Advisor – Before You Invest a Dime With Them!” - a free report that gives you the information and tools you need, to select the best financial advisor you can to help build a financially secure future.

I would like to hear from you on this important topic. Have you ever been a victim of a financial scam or fraud? Did you recover all or part of your investment? Did you report it? Let me know.

Until next week, Dump Debt, Invest Wisely, Believe in Yourself and Make it Happen!

-Matt

http://www.ChecksandBalances.TV

http://www.facebook.com/ChecksandBalancesTV

http://www.twitter.com/MatthewJRettick

New Bank Fees

This week’s CBTV show is entitled, “New Bank Fees Got You Down? Let our Checks and Balances Process Help!”

New federal debit card rules went into effect on October 1st, reducing the fees financial institutions can charge merchants to process each debit card transaction, from an average of 44 cents to 21 cents.  Major banks with more than $10 billion dollars in assets have seen the amount of revenue made from debit card transactions, cut in half as a result of these new federal rules.  Unfortunately for most Americans, this has forced many banks to find new ways to replace this lost revenue, and they’re looking to you and me to fill the void. Bank of America recently announced it would start charging their depositors a $5 monthly fee to help offset this loss in revenue. As you can imagine, this set off a backlash from customers who are sick and tired of incurring additional fees, especially during these financially trying times.  In the face of hard economic times and corporate greed, as demonstrated outside the halls of Wall Street lately, this latest move by some banks to nickel and dime their loyal depositors, is coming to a boil!

Bank of America is the largest financial institution in the U.S., and estimated that the cap on transaction fees would cost it approximately $2 billion dollars annually in lost revenue.  Their response was to charge its customers a new monthly fee of $5 for debit card transactions, beginning early next year.  An additional $60 per year, per customer would give Bank of America $3 billion dollars a year in new revenue, based on its 57 million depositors, providing the bank with $1 billion dollars more than it was making previously.  But Bank of America is not alone. Other major banks such as JPMorgan Chase and Wells Fargo are also testing $3 monthly debit card fees in select markets and Atlanta-based SunTrust bank began charging a $5 monthly fee this past summer.

Some have argued that the government’s overregulation of banks through the Dodd-Frank Act has resulted in banks simply passing along their loss in revenue to consumers. However, losing a significant amount of revenue has given major banks little choice, but to charge extra fees to their customers.  Two weeks before revealing the new monthly debit card fee, Bank of America announced plans to cut 30,000 jobs as part of a plan to save $5 billion dollars through 2014, revealing that times are tough for banks as well.   

In this current economic climate we find ourselves in, it seems as though we are constantly being nickel and dimed by the companies we do business with.  From companies like Bank of America who will soon charge their customers $5.00 a month to use their debit cards, to airlines charging travelers extra money to check their bags, to major consumer goods companies who have down-sized the contents of their product, but still charge the same money, it’s consumers who are ultimately paying the price!

As CBTV celebrates our first year anniversary, we want to remind you that Checks and Balances TV is all about bringing you balanced advice and financial truth, so you can make informed financial decisions.  Our Checks and Balances process is designed to give you a balanced perspective on all things financial, to teach you about other options available, and give you both sides to every story, so you can take control of your finances and gain financial freedom.  We work very hard to continuously give you the information you need to financially succeed, and we thank you for your support in making CBTV, America’s #1 source for balanced financial advice!

Until next week, Dump Debt, Invest Wisely, Believe in Yourself and Make it Happen!

-Matt

http://www.ChecksandBalances.TV

http://www.facebook.com/ChecksandBalancesTV

http://www.twitter.com/MatthewJRettick

A New Financial Reality

This week’s CBTV show is entitled, “Are You Ready for – The New Financial Reality?”

What’s causing this “New Financial Reality?” A perfect storm really, such as: the continued volatility in the stock market, the uncertain future of Social Security and Medicare, the real estate collapse, mortgage foreclosures, high unemployment, the staggering national debt, dwindling personal savings, and much more. The number of people concerned about their long-term financial future has risen dramatically, to two-thirds of all retirees and working Americans, according to the Principal Financial Well-Being Index. As a result of this loss in confidence, many Americans are downgrading their expectations for the future, and being forced to take more personal responsibility for their financial future than ever before.

There are many contributing factors shaping this “New Financial Reality, most importantly is the current and future state of our economy.  Americans can’t hide from the fact that Standard and Poor’s downgraded long-term U.S. debt for the first time in history, and that the unemployment rate has continued to linger above 9%. Real estate values for most Americans, has continued to remain low, and the stock market volatility has been so unpredictable that millions of Americans have lost trillions of dollars in their retirement plans.  We also, can’t help but be concerned about pension plans that are “under-funded,” and the very real possibility of Social Security going bankrupt in 2036.

However, the “New Financial Reality” is self-made as well.  Not everything happening to boomers and retirees are because of external pressures – some are because of internal pressures and decisions.  For example, some people have lost their confidence in retiring comfortably because they’ve spent the greater part of their adult life spending everything they’ve made, to keep up with the Jones’.  Here’s some late-breaking news: the Jones’ are broke, too! Unfortunately, instant gratification has replaced delayed gratification, and as a result, a new financial reality is on the horizon for many.  A prime example of this, is the “reality” that more than half of all U.S. workers have less than $25,000 dollars in savings and investments, according to the Employee Benefit Research Institute’s latest Retirement Confidence Survey.  That type of savings won’t get you through the first year or two of retirement, let alone a more than likely 20-year plus stretch.    Now is the time to get serious about your financial future, by writing out a monthly budget, spending less and saving more! Your retirement success depends on it! 

The key to dealing with this “New Financial Reality,” is to make better informed financial decisions, and rethink your approach to preserving and protecting your money, through your own personal checks and balances system.  This may involve doing a number of things differently, including finding additional ways to pay off debt, stretching your paycheck (or unemployment check), hoarding your nest egg, reanalyzing your retirement plan, keeping up with payments on an upside down mortgage, or saving as much money as you can each month. You have two choices when it comes to your financial future, either accept this new reality, and work hard to make your financial dreams come true, or just hope for the best, but don’t change your spending and savings habits.  The choices you make now need to be the right ones, if you’re ever going to achieve financial security and stability in retirement. 

 I would like to hear from all of you who have read this blog. Do you agree with me that we are all living in a “New Financial Reality” that will continue on, perhaps forever? What steps are you taking to financially succeed in this new reality? Until next week, Dump Debt, Invest Wisely, Believe in Yourself and Make it Happen!

-Matt

http://www.ChecksandBalances.TV

http://www.facebook.com/ChecksandBalancesTV

http://www.twitter.com/MatthewJRettick

Changes in Retirement

This week’s CBTV show is entitled, “Columbus Day to Today: How Retirement Has Changed Since 1492!”

According to Financial Finesse, a leading provider of financial education programs, their 2010 Year in Review, found that 82% of employees are paying their bills on time, and 51% are paying off their credit card balances in full.  That’s the good news from a company that provides financial education programs to over 500,000 employees, from more than 300 corporations, municipalities and credit unions across the country.  The bad news, according to their newest study released September 14th, is that only 14% of those employees were on target to reach their retirement income goals. They also reported that nearly 4 out of 5 Americans have still not determined how much money they will need to have saved, to afford the retirement they were hoping for. 

Without proper financial planning and implementation, the age that people will be able to retire will continue to rise.  The Employee Benefit Research Institute, discussed this very topic during their 68^th policy forum held in Washington, DC, on May 12^th. The theme for this conference was, “Is There a Future for Retirement?”  EBRI’s discussions focused on baby boomers and Generation Xers, many of whom would not have adequate income to cover their basic retirement expenses and uninsured medical costs, even if they delayed retirement until they were past the age of 65. According to the Institute’s Research Director, Jack VanDerhei, continuing to participate in a defined-contribution plan, like a 401(k) past age 65, can make at least a 10 percentage point difference, in determining whether or not an individual has adequate retirement savings. And a 10% increase in your nest egg can go a long way in making your money last in retirement. 

The biggest issue pre-retirees are facing today, is uncertainty.  This uncertainty may be due to: fear that their pension may not be there when they retire, or that their Social Security benefits will be reduced, or having lost so much money in the stock market recently, that they will not have enough savings to get them through their retirement years.  Whatever the reason, those approaching retirement are losing confidence in their ability to afford a comfortable retirement.  The landscape for retirement has significantly changed, since the creation of Social Security, over 75 years ago.  Before that time, retirement in this country was widely seen as a means of getting aging factory workers out of the workforce. However, it wasn’t until the government instituted the Social Security program, in 1935, that offered these older workers a financial benefit to retire, in the form of a monthly Social Security check.

Raising the retirement age is one solution being discussed by Congress right now, to solve the problem of rising Social Security, Medicare and Medicaid costs. The average life expectancy in 1935, when Social Security was established, was 65 years, as of 2010 it’s 78.3 years. In addition, pensions and other employee benefit programs have become much too expensive to maintain for many companies, so benefits must be cut.  The changing financial landscape of retirement is forcing people to take more responsibility for their future finances.  Retirement, at least as we’ve known it in years past, has officially “retired,” and now, unless you take matters into your own hands, the future of your retirement, remains unknown.  Nobody wants to revert back to the industrial age, when people literally worked until they died.  While many Americans have relied on the government or their employer in the past, the only one you can truly count on to fund your retirement, is you.

So, whether we like it or not, each of us will have to become fully responsible for our own financial success or failure in life. And the earlier we take our financial destiny into our own hands, the better.

 I would like to hear your thoughts on this week’s show. What is your plan of action to financially secure your future?  Until next week, Dump Debt, Invest Wisely, Believe in Yourself and Make it Happen!

-Matt

http://www.ChecksandBalances.TV

http://www.facebook.com/ChecksandBalancesTV

http://www.twitter.com/MatthewJRettick