You also need to know this year’s changes in tax laws. The government has created new and expanded deductions, credits and other breaks. They can benefit many people if they find time to read the fine print. Here are some details to watch out for before you submit your papers.

Standard Deduction – The basic deduction for 2009 is $11,400 for married couples filing together. For single individuals, the deduction is $ 5,700. There are higher amounts for the blind and people aged 65 years and above.

Charitable Giving – There is a new law that allows people who give money to charities, like relief to the recent Haiti earthquake, to deduct their contributions on their 2009 tax returns. This “immediate tax benefit” only applies to cash contributions after January 11, 2010 and before March 1, 2010. The gifts must be made specifically for Haiti quake victims.

Car Purchases – Taxpayers are eligible to deduct some or all of the state or local taxes or excise taxes paid for buying new cars, light trucks, motor homes or motorcycles during 2009. However, there are restrictions. Deductions are limited to taxes paid on up to $49,500 of the purchase price of each qualifying new vehicle. The new vehicles must be bought after February 16, 2009 and before January 1, 2010. Leases are not counted.

Home Purchases – The extended and expanded tax credit of as much as $8,000 will benefit those who purchased a house during 2009. It is widely known as the first-time homebuyer credit but can be useful to other qualified homebuyers.

Capital-Loss Carryovers – Be sure to check if you have loss carryovers. The rules are still the same. Capital losses can be used to soak up capital gains on a dollar-on-dollar basis. If there are more losses than gains, you can deduct up to $3,000 a year ($1,500 for married individuals and filing separately) from salary and other income. Additional losses are carried over into future years.

Mileage – The standard mileage for business use of a car, van, pick-up or panel truck for the period of 2009 is 55 cents a mile. If you use your car for medical reasons or as part of a deductible move, the deduction adds up to 24 cents a mile. If you use it to provide services to charity, the deduction is 14 cents a mile.

There are many sources available, including tax breaks for college costs and tax credits. We can assist in finding the most suitable options available for you. You can get them and more by signing up on the top-right form today.

It’s never too late to deal with these concerns. Here are four common money stressors, each with easy, do-it-yourself remedies:

Worry no. 1: Paying off debts

Solution: Perform plastic surgery, then build a cash reserve

If you’re worried about credit card dues, here is some quick advice: Pay off the highest-interest balances first. Consolidate debt as efficiently as possible through balance transfers. The key to financial freedom is to stop depending on credit cards. Whenever possible, use cash exclusively until all credit card bills have been paid off.

Worry No. 2:  Savings for a child’s education

Solution: Save $10 a day

The best way to afford college is to save early. $10 per day in a 529 college savings plan can be worth around $150,000 by the time a child reaches freshman year. The average cost of public colleges is $12,000, rising 7% every year while private colleges cost $30,000 a year. If possible, try supplementing a traditional 529 savings account with a second type of 529 plan: A prepaid tuition plan. This plan protects individuals from rising tuition costs by buying future college semester tuition at today’s prices. There are more than 250 member colleges in this plan. If the child ends up not attending any one of the member schools, one can withdraw the principal and its interest, and use it as a traditional 529.

Worry no. 3: Saving for retirement

Solution: Max out a 401(k), but don’t stop there

With the stock market in recovery, now is the time to invest if one has a 401(k). According to the IRS, the cost-of-living for pension and retirement plans for 2010 remain unchanged. This is good news for many who had feared that the limits would be reduced. Each year, in October, these limits are adjusted according to a formula based on the inflation rate in the third quarter versus the previous year’s quarter. For a larger retirement fund, save an additional 10% of your take-home pay. Have it automatically deducted. Invest it in other money-yielding plans.

Worry no. 4: Living beyond means

Solution: Put expenses on a 10% diet

Start cutting 10 to 15% from monthly expenses. Here are some examples:

Mobile phones The average cell phone usage is 422 minutes a month. Reducing allowable minutes from 600 minutes to 450 can save around 10%. Prepaid plans are a better deal for usage below 400 minutes.

Utility bills Older water heaters consume 25 percent of energy. Buying a $10 water-heater blanket can reduce bills by as much as 10%.

Auto insurance Raising a deductible from $500 to $1,000 can save up to 40%.

There are many options for saving and being free from financial worries. Start living a life without debt. Sign up on the form located on the top right to find out more.

Here are a few details to remember about the new rules:

You need a co-signer. The co-signer must be an adult willing to address any issues or debts that may happen if the student fails to pay. This applies if the student or the applicant is below 21 years of age.

If you can’t get a co-signer, present proof that you have the ability to pay. In the event that you cannot find an adult to co-sign for your credit card, you must prove that you can financially handle credit card payments. Just what is needed to prove this is up to the banks or the credit card company.

You can still apply online. However, you will still have to follow all the new rules.

Reactions

The issue of student credit card debt has affected local reactions to on-campus credit card marketing. In New York, all on-campus offers for credit cards are banned. In Texas, campuses have designated areas for credit card marketing. Even then, they are required to give financial literacy programs.

But for students who do know how to handle their money, the new rules are a mixed bag. There is agreement that credit cards marketed to students shouldn’t have high credit limits, and that students shouldn’t have to go through so much for a credit card. The bottom line for many is that a balance between accessibility and the credit limit should be found.

Sign up on the box at the right for more information on student credit card debt relief, consolidation and other similar options.

Dodge your credit with the best advice

If you are planning to refinance your mortgage or do anything else that requires borrowing, it is better check your FICO scores before doing the next move. Here are eight important tips to remember in order for you to improve your FICO scores:

Settle on time. This is an unwritten rule in credit cards: Never pay late. Delinquent payments have a negative impact on your FICO scores.

Pay it off. The fastest way to increase your score is to pay down an existing debt. If you pay a maxed-out card in full, there should be a dramatic increase in your score.

Spread it out. If you have more than one credit card, it is better to spread your balances. This could help your score slightly, as you are lowering your balance-to-credit ratio on each card.

Never open new accounts quickly. New accounts can lower your average account age, which will have an effect on your score.

Re-establish credit history. Opening new accounts responsibly and paying them on time will raise your credit score in the long term.

Apply for and open new credit if necessary. Do not open accounts just to have a better credit mix. It will not raise your credit score.

In all, credit scores can make or break your financial standing. When you have a good score, you can go into all the negotiations for the best lending programs. But the people with low scores will find themselves at the end of the line.

The best advice is to manage your credit wisely. Know all the options available.

debt/whats-the-score-with-your-credit-score-part-one/”>Click here for the first part of this article.

Sign up on the box at the right to find out more about your credit score, and other options that you can use when dealing with credit and loans.

In this first of two parts, find out how credit scores affect major financial transactions.

In today’s challenging economy, credit scores have become important to one’s financial stability. They are the hottest figures of the day and if you are not in good standing, chances are you are trapped in a situation that spells out nothing but economic trouble.

If you have a high score, you have red-carpet access to all kinds of credit. And if it your score is horrible, you will get a ridiculously high interest rate or no loan at all.

Finding out

When was the last time you checked your credit score? If you have not done it, now is the time to do so. Remember that credit scores are not just about borrowing. Do you need insurance? The underwriter verifies your credit score first before you get a policy. Even employers have to check on your credit scores before hiring you. Lenders are willing to give you what you need, and possibly more when they see you as a good creditor.

How a credit score is calculated

A company called Fair Isaac Corporation is responsible for finding out if you are worthy of credit. It prepares your FICO score, a number ranging from 300 to 850. Your FICO scores are calculated from the different credit data in your credit report. This data can be grouped into five categories: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%) and types of credit used (10%).

Fair Isaac gathers a constant flow of data detailing your spending habits through major credit-reporting agencies: Experian, Equifax and Trans Union. These agencies track how many credit cards you have, how much your car or housing loans are, and whether or not you are paying your bills on time. They score these data using the FICO software, which generates your three-digit number. A score above 750 is good, and the best loans go to people with scores above 780.

debt/whats-the-score-with-your-credit-score-part-two/” target=”_self”>Click here for the second part of this article.

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The ability to pay

Credit card companies will have to asses a person’s income and debt details, by verifying what people put down as their income in the applications. While this isn’t a bad idea in itself, this will affect small business owners and low-income families who use credit cards as a lifeline in times of crisis. This, too, raises questions for the unemployed, and about the ability of smaller businesses to raise capital and to improve themselves.

Car loans, mortgages, house expenses and medical bills all figured into the emergencies that credit cards were used as a stopgap measure. For those who know how to cycle through their finances, a credit card simply allows them to space out the payments, rather than have a heavy single-time sum. But with the new regulations, even financially responsible people may be unable to get the credit cards that they need.

Banks, however, can rely on income estimates based on previous spending habits, ability to pay loans and types of accounts opened.

What you can do

Be aware about how the credit card you’re applying for will verify your income – and if necessary, provide them with more info that you think will help. Also, if you have any debt unpaid at this point, then it’s time to pay them off as fast as possible. Credit scores will now play an important role in how credit cards will be approved.

Sign up on the box at the right to receive more options you can use with the credit card reform in mind.

Instinct

Your subconscious can sometimes pick up risks better than your conscious mind. If you have any doubts about a purchase or a loan, give it at least a day and think it over. You never know, you may see more sides to the deal than if you had gone ahead the first time.

Signing in

Unless it’s necessary, don’t co-sign a loan with someone, particularly a close friend or loved one. If your co-signer suddenly flubs on a payment, it’s more difficult to solve money matters with people you love or good friends. Even if your child is the one who asks for help, what is important is to keep your own financial ship under control, not anyone else’s.

This also applies to the idea of leaving your money under the control of your father, mother, husband or wife. Never hand over financial control to someone else. That includes bank accounts, as well.

Keep a list

It doesn’t matter if it’s just a can of soda – the point is, the more accurate your expense tally is, the better you will be able to control your finances. This is perhaps the most important budget-cutting tip you can follow. By keeping a list, you also create in your mind a counter-list of expenses you can do better without. Once you make that a “real written list,” you can then “edit” your budget. Any savings should go to either paying off your debt or saving up for a rainy day. With retirement, health insurance and education costs for your children to look forward to, it’s best to be as prepared as you can be.

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Here is the new set of credit card rules from the Federal Reserve.

No floors

Credit card companies will not be allowed to set minimum interest rates. They won’t be able to raise rates until 60 days have passed on a late payment. These rate “floors” had been used to make up for the risk involved with credit cards, particularly with more people being unable to pay on time, or at all. Monthly statements will have to indicate clearly how long it will take consumers to pay off their debt if they only pay the minimum every month.

Fair warning

However, the case will not be the same for variable interest rate cards, which base their rates on the prime rate. The prime rate follows the general trend of the economy. However, given that banks may try to pick the day with the highest interest rates for the month as the reference for their rates, the new rules say that they have to warn their consumers 45 days in advance when they will change their rates.

You’re in when you say you are

The credit card applicant or holder will not be automatically enrolled in programs that will allow them to charge beyond their credit limits. This practice introduces actions similar to overdrafts, with fees included that are sometimes not told to consumers.

Sign up on the box at the right to get more information about new credit card rules and options that can be to your advantage.

Warm yourselves correctly

Unless there’s a big front coming in, set your thermostat to around 65 degrees, and wear comfortably warm clothing, like sweaters and thermal underwear. You can lower it to 60 degrees when you go to sleep – just make sure to have a second blanket.

Insulation is the next step. For a few hundred dollars, the potential savings over the years (even with maintenance costs) are in the thousands. Take note of unused rooms, basements and attics in particular. Heavy drapes during the winter can also help in insulating windows.

Work savings

If you can walk or bike to work, you can both save more money, and at the same time keep fit, which may bring medical costs and expenses down (not to mention improve future insurance terms).

Pack your lunch. Even better, get a few of your friends at work to form a “lunch club,” so you all can share food. Aside from savings and adding variety and a pleasant atmosphere to your lunch breaks, it can also be the start of an effective peer network.

Eat well

Learn how to cook, even if it means “five-minute” preparations. Once you become more experienced, you will be able to match most restaurants for flavor and preparation. You’d be amazed at how much you’ve saved, and really, nothing beats good home cooking. If you will go out to eat, don’t be ashamed to budget your meal realistically.

And, if you can do all these savings without using your credit card, then it will be much better. Living on a cash-only basis can potentially almost double all the savings you’ve been able to do.

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By installment

Large debts are usually in the form of installment debts. These debts are designed so that the debtor must pay a part of the total regularly within an agreed-upon time. A percentage of the original sum, called the interest, is also added to the total as a form of fee.

Installment debts normally have specific interest rates. Car loans have rates that hover around 8% to 9%, while 30-year home mortgages usually have rates of 5% to 7%. Monthly payments are usually fixed at a specific amount over the whole period.

In the beginning, most of what you’ll be paying will go to the interest rate. However, as time goes on, the interest gets smaller as you pay more and more of the principal. Debt management and relief for this type of debt can be simplified to the following: look for affordable terms at the very beginning, and make sure that the monthly isn’t a drain on your resources.

Revolving credit

Revolving credit, also known as open-ended credit, is available any time. The best examples of this type are credit cards. The credit amount you can use is based on your income and credit payment history.

When you use the credit, you have to pay a minimum monthly amount based on the total outstanding balance. However, this is where the problem can begin. If you only pay the minimum amount every month, you can end up paying mostly for the interest and with only a small amount for the principal. If your balance is large, you may end up paying for it in years.

Credit card debt relief and management starts at the beginning. Credit cards should be used only in emergencies or when you absolutely need a large item you can pay for in a few months. Remove credit cards with a high-interest rate from your wallet, and if you can, get rid of them entirely. Always read your account statements carefully, to see how fees are calculated. Finally, transfer credit balances from accounts whose interest rates will rise in the next few months.

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