Category Archives: Opinion

Practical Money Matters – March 4, 2015

By Jason Alderman

How to Avoid an Online Vacation Rental Scam

Imagine renting a home on a beautiful beachfront from a trusted website, arriving to start your vacation and finding out you’ve been scammed?
This scenario reflects thousands of complaints placed with the U.S. Federal Trade Commission (FTC) last year involving local vacation rentals. The FTC reports some victims lost money by wiring cash to thieves posing as property owners. Others lost money through fake websites replicating legitimate sites.
In today’s economy in which home sharing has become more popular, how do travelers protect themselves from a range of potential online scams? Here are some suggestions:
Review rental contracts carefully. Check the address of the property you’re interested in with on-the-ground resources like the local tourism office or the leading real estate brokerage in the community. While you’re speaking with the tourism office, ask if there have been any specific complaints against the rental service you have consulted or if there might be more reliable and possibly more affordable rental resources in town.
Be wary of your source. Legitimate property owners may use free print or web classified ads to save money, but it’s important to vet any free listing very carefully. Also, confirm with a live representative to ensure the site is legitimate.
Compare rental rates in the immediate area. A good deal might be tempting to seize immediately, but the FTC notes that severely below-market pricing for rentals and other vacation services in a community might indicate a scam. Crosscheck the pricing of home rentals and related services in the community before you make a reservation. Given the example above, don’t rely on the Internet alone. Pick up the phone and talk directly to a representative.
Check transient license law in your destination city. Transient licenses regulate properties rented to guests for time periods generally 30 days or less. Call your destination city to get details on their transient license law and whether you can confirm the registration of the property you’re considering. Ask the property owner for a copy of his or her transient license and see if the city will share the same license for your inspection to make sure they match. Also ask the city whether any specific complaints are available for the property you are considering.
Be wary of phishing scams. Be on the lookout for email and phone scammers who masquerade as employees of businesses you trust – they’re after your bank or credit information. If you receive emails or phone calls demanding advance payments, contact the original website to confirm your reservation and payment policy. Recently, travel site Booking.com had to pay out compensation to more than 10,000 customers from the U.S., UK, France, Italy, Portugal and the UAE who were victims of a phishing scam.
Follow recommendations. Personal recommendations from friends and family can ensure a safe transaction. If you know someone who has visited a destination or rented property recently, ask which companies or individuals they would recommend.
Report fraud. Inform the local police at your vacation destination, the local Better Business Bureau and the FTC. When you get home, notify your local police or your state attorney general’s consumer protection office to alert them to this particular cybercrime if you made the money transfer from your home state.
Bottom line: As online vacation rentals grow, so does cybercrime. Be cautious when booking arrangements online to protect your payments data.

Practical Money Matters – February 25, 2015

By Jason Alderman
Making Sure Loved Ones Are Prepared for Their Retirement Years
What if a sudden, debilitating illness, fraud or economic downturn affected your senior family member’s retirement, estate or long-term care issues? Would you be prepared to take over?
If the answer is no, you’re not alone. According to 2013 research from the Pew Research Center, four in ten U.S. adults are caring for a loved one with significant health issues.
Don’t wait for a crisis to initiate this conversation. Starting early can help you plan and even safeguard your own career and retirement planning. Here are some suggestions for starting the conversation:
Identify the missing links. Find information gaps you need to fill to help your senior relative plan for retirement. If key financial information – investment and banking accounts, legal documents or doctors’ contact information – is missing, list any and all unknowns to be researched and compiled.
Schedule a family financial meeting. Schedule a specific day and time and create an agenda that meets the needs of your senior relative. It is not always necessary to involve all direct family members in a preliminary discussion, but make sure that relevant individuals are aware of the meeting. After helping your senior relative assess his or her financial situation, make sure to identify next steps and responsibilities.
Locate important financial documents. Ask your senior relative to show you where his or her key documents and accounts are, such as retirement and pension information, checkbooks, investment statements, insurance policies and legal and estate data. Find out where incoming bills are kept in case you have to step in and help manage monthly bills.
Consider seeking financial counseling. Any number of reasons, from illness to fraud, may explain losing control of personal finances. If your relative has been working with a qualified financial or tax advisor, the family team should consider meeting with him or her if a need arises. If outside tax, financial or legal help is needed, the team and your senior relative should discuss who those professionals should be, what their fees are and what you expect them to do.
Make and agree on a plan. After all the information gathering and discussion is complete, make a plan – in writing, if possible – to review the senior’s wishes, set an action plan and assign responsibilities as necessary. As mentioned above, you should review this plan every year. And if problems emerge in any topic area from retirement to health issues, logon to practicalmoneyskills.com/personalfinance/ where you’ll find guidance throughout the Practical Money Skills for Life website .
Bottom line: Asking older relatives about retirement, estate and long-term care preparations can be an uncomfortable conversation. Making a plan and initiating early conversations to involve the right people can ease the financial strain and stress on everyone involved.

ViewPoint: Iowa Legislature to Consider Fuel Tax Increase

By Dawn Pettengill
I believe every day working at the Capitol is a blessing and a big responsibility. That’s why I do my best to make votes based on facts — by getting your input and doing my research.
One that is turning into a real killer decision is the fuel tax vote coming up. The last time the fuel tax was increased was in the late 80s. In 2006, a comprehensive study was done on road/bridge infrastructure needs. We were short of meeting those needs by about $220 million dollars a year. At that time, I made a commitment to support an increase in the fuel tax and have said so every year.
Nearly ten years later, we still haven’t increased the fuel tax and our lack of money for maintenance is showing. Cities and counties are borrowing money to fix roads when they should be able to count on money from the Road Use Tax Fund. Every penny of gas tax generates around $22 million for the Road Use Tax Fund, which is a Constitutionally protected fund reserved solely for roads and bridges.
Two years ago, the Governor told the DOT to find efficiencies. They did, reducing spending by $50 million. The dollars saved went to road repairs. We know there are more ways to find savings, but they don’t come close to $220 million a year.
After reaching out to my constituents, I received input on both sides of a fuel tax increase. Nobody wants to pay more, but some can see it is needed. Nobody wants to vote for it either, but some see the need. It is my job to make these decisions and I was supporting it. Like so many things in Des Moines, a couple of Democrats, Republicans and the Governor came together to see what everyone can agree on. When we got the bill last week from that select group, the bill has some “deals” in it that I’m not sure I can vote for.
The bill is supposed to be a money raiser for the Road Use Tax Fund, with a 10 cent fuel tax increase, $220 million. But included in that bill are a couple of decreases. One is a ten year ethanol differential that reduces the Road Use Tax Fund about $7.5 million a year. Okay, we are raising $220 million a year and then we give ethanol $7.5 million of it in the same bill? I support ethanol and have voted yes on this every year. But c’mon, let ethanol stand on its own. Also added was the same thing for biodiesel, only three cents a gallon instead of the two cents for ethanol. Again, these are supports for our Iowa economy, but it makes it harder to vote for the bill…adding to the cost of gas to fix roads and then cutting breaks in the same bill.
A few other things were added and I’m not as committed as I was before, but will do my best to keep you taxpayers at the desk with me when I make the final vote. I know one thing for sure. The fuel tax is the cheapest hit to your wallet and it hits harder the people who drive more, like me. That’s the way it should be. I don’t want people who drive to church once a week paying higher registration fees again. Stay tuned.
Also, hopefully this week we will finish out the supplemental state aid debate and get it to the Governor. We sent our bill over to the Senate three weeks ago and finally got their response late last week. Stay tuned there too.
If you have any concerns or questions, give me a call at 515-281-6879 or send an email to dawn.pettengill@legis.iowa.gov. I’m here for you!

Practical Money Matters – February 18, 2015

By Jason Alderman

Starting Roth IRAs for Your Grandkids

Many grandparents go above and beyond to offer financial help to adult children and grandchildren. If you’re seeking to contribute to your grandkids’financial future, one option might involve opening a custodial Roth IRA (www.irs.gov/Retirement-Plans/Roth-IRAs) on your grandchild’s behalf as soon as he or she starts reporting earned income.
While grandparents often find 529 college savings plans advantageous for their personal estate planning as well as supporting their grandchild’s educational future, custodial Roth IRAs may allow for more flexibility depending on the child’s future needs. For example, a young adult may use tax-free Roth IRA proceeds to fund education expenses not covered by savings or a down payment on a first home. Roth IRAs may also be a useful and collaborative savings tool for important expenses young adults have, such as continuing education or a down payment on a first home.
Unlike traditional IRAs, Roth IRAs are funded with after-tax dollars. That means the account holder doesn’t get a tax break at the time of initial or successive deposits, but the money grows tax-free and can be withdrawn tax-free – a benefit for a grandchild who may need a substantial sum in the years to come.
Here’s an example of how much an initial $2,000 deposit in a Roth custodial IRA can grow. For an account opened at the time the child is 16, the $2,000 opening deposit – without any more money added to the account – could be worth roughly $55,000 at the time the child reaches age 65 assuming a 7 percent expected rate of return.
What if the child needs to make a tax-free withdrawal sooner, such as at age 35, for example? Based on the same earnings calculation as above, he or she would receive a less impressive sum of roughly $7,200. Of course, it remains a potential solution if there is a severe need for cash.
In 2015, the annual contribution limit for all IRAs is $5,500. It is possible, though not that easy, for a minor to open a Roth IRA on his or her own, which is why it’s good for grandparents – or any qualifying friend or relative – to shop for custodial accounts with low fees and low investment minimums to start. This is compounded annually.
As you evaluate a decision to open a custodial Roth IRA, check with the broker and the account administrator on any institutional or state rules on custodial accounts and what information you’ll need to open one. Depending on those rules, there’s a chance that grandparents may not be able to open the custodial account directly and you will have to work through their parents or legal guardian to get started.
Also, consider the following:
Make sure you’re financially secure. The MetLife study notes that many grandparents tend to overextend their financial support when it comes to family members in need. Seek advice from financial, tax and estate professionals on how much you can reasonably afford to give and the best means to do so.
Coordinate with your grandchild’s parents or guardian. It is important for family members to remain open about all money issues, particularly in relation to minors. Discuss what provisions the parents have made for the child and whether your idea complements financial strategies already in place. If not, keep talking and discuss other ways you can help.
Consider your grandchild’s potential handling of the account. When your grandchildren reach legal age or meet other key requirements of the account, they can take control of the money. Will they be ready? If not, evaluate other investment vehicles that better meet your objectives.
Bottom line: Setting up a custodial Roth IRA may be a good way for grandparents and grandchildren to work on retirement or other financial goals.

Help Desk: Photographs

HelpDesk
Help Desk: An Inside Look at The Progress Review

If a picture is worth a thousand words, then there is more than ample reading on The Progress Review’s websites. In less than a year, we’ve posted more than 60 photo galleries, in excess of 3,000 pictures. And that figure does not account for all the photos we shoot. For example, the 150 photos from the sectional wrestling tournament posted online on Feb. 8 numbered more than one thousand on Mary Bauer’s camera before they were selectively edited and processed.
We post a lot of pictures because we take a lot of pictures, more than we could ever hope to publish in The Progress Review print edition, which typically spans 8-10 pages each week. Posting pictures online allows our readers to enjoy images that otherwise would not see the light of day.

With technology that allows a burst of a half dozen photos to be taken in little more than a second, it doesn’t take long to generate hundreds of images, way more than anyone wants to scroll through on their computer, tablet or cell phone.

Given the number of photos The Progress Review shoots, it is not surprising when we receive requests for reprints of images we’ve published.
In a perfect world, reproductions of the photos we publish would be free. Unfortunately, equipment and software costs, along with the immense amount of time invested in travel and image processing, make photography one of the more expensive activities we undertake.

Over the years, our efforts to accommodate such requests has been met with varying degrees of success. We’ve learned that the costs associated with providing actual photo reprints is much higher than our customers are willing to pay. And who can blame them? You can walk into any photo retailer and generate an instant photo print for 29 cents (or less). The reason why most newspapers charge several dollars for a comparably sized photo reprint is more about the amount of time it takes to process the order than the actual reprint itself.

Our quest to provide photos in a timely fashion at a price closer to what our readers are willing to pay has evolved into a previously unexplored dimension for us- digital downloads. Digital downloads offer several advantages:

Instant delivery. As soon as the purchase is complete, an e-mail is sent with a link to the photo. One click and the photo is downloaded to your computer.

Multiple Uses. A digital photo can be immediately used online with social media profiles like Facebook and Twitter. They can also be used to order as many reprints needed for personal use, and the reprint size is not limited to 4×6 prints.

Cost Effective. Because digital download photo galleries can be processed in bulk, it takes us just a fraction of the time previously needed to offer them for sale. Less time translates into much lower prices. In fact, The Progress Review now offers progressive discount pricing on digital photo downloads ranging from 50% to 80% off. Once you’ve purchased a total of ten photos, all successive photo downloads are just one dollar each.

If you enjoy looking at photos, logon to www.theprogressreview.co or The Progress Review’s online marketplace, www.shoplpcink.co and click on the photo gallery links. You’ll find lots of galleries to look at, and while there is no cost to view the images posted there, the option to purchase a digital download is there if you want it.

If you have any questions or would like more information about this Help Desk topic, call 319-342-2429.