Advanced Personal Finance

You can easily stop most of the unsolicited credit card and insurance offers that come in the mail. I say ‘most’ because not every unsolicited offer uses prescreening through the credit bureaus. I did this several years ago when I first read how to do it. It takes all of two minutes.

“Prescreened” (also called “prequalified” and “preapproved”) offers come without your request from credit and insurance providers. Those firms buy lists from the credit agencies of people meeting their requirements.

How to opt out

Online - https://www.optoutprescreen.com/opt_form.cgi Using this form you can either opt in, opt out for five years online, or opt out permanently using a mail-in form.

Phone - 1-888-567-8688 This is an automated phone system version of the online one and is administered by the same people.

Note: You’ll have to provide home address, date of birth and SSN for verification.

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Since writing my post on identity theft for kids, I’ve come across the details of how a parent can request the credit report, if any, of his or her child. This comes from Smart Money.

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About a year ago, my wife was hit from behind and her car was ultimately declared a total loss. She was not seriously injured, thankfully. We did learn from the experience, though, and I’d like to share some of those lessons here. (We also later learned how not to buy a car)

I hope you never have to use this list.

1. Go to a hospital if you suspect any injury, no matter how slight. Except in the case of very low-speed collisions, you will certainly feel sore in the back and neck the next day. So there’s very little reason not to go to a hospital and get checked out.

2. Get a police report. This might seem a no-brainer, but insist that the police write up the accident. Sometimes they’ll be unenthusiastic about doing so. Make them do it anyway.

3. If at all possible, get phone numbers from witnesses. This is absolutely critical. In an accident, you must assume the other driver will give a version of events that puts them in the best possible light. People will often lie about the circumstances of the accident. I know. It happened to me. A woman drove into the side of my car on the beltway in broad daylight and told her insurance company it was my fault. Naturally, any insurance company is going to side with their client - they have a financial interest in doing so.

4. Take pictures. With the ubiquity of cell phone cameras, it’s pretty easy to take pictures of the scene and both cars. It takes a more than a little presence of mind, though, so if you don’t remember, don’t worry about it.

5. Call your insurance company as soon as possible. It’s important to immediately make a statement about the accident to your insurance company. You do not want them to hear about the accident first from the other insurer. Plus, the details of the incident are fresh in your mind.

6. Keep good records. Keep copies of all reports, medical bills, and estimates. Also start a log of contacts with both insurance companies. Record who you spoke to, when, and what the conversation was about.

7. Don’t mention a lawyer unless you truly intend to hire one. As soon as you mention to an insurance company you are talking to a lawyer, they will immediately stop talking to you. Then your hand is played - your committed to hiring one.

8. Don’t accept the first settlement offer. I’m definitely no negotiating professional, far from it. But I have it on good authority from a friend in the business and from personal experience that the first offer is always going to be laughably low. Just tell them that’s not an acceptable number.

9. Using your records, develop a reasonable settlement offer from your point of view. Things to consider include property damage, lost wages, medical payments, car rental, and personal inconvenience. I’ve been told it’s best to stay away from mention of ‘pay and suffering.’ It’s overused and tends to turn off claims agents.

These are all things we learned from our experience when my wife was hit from behind and went through the process. I’m not an expert in this (and don’t want to be!), so take this list as a starting point.

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Identity theft can be a problem for anyone - even kids. Among the most novel directions for identity thieves recently is their preying on children. As any parent knows, you have to get a social security number for your child when they’re born. The thing is, they won’t actually need that number for anything remotely associated with Social Security for a long time.

Remember, your SSN isn’t supposed to be used for identification, right? It says so right there on the card. The card that every business, bank, or government agency requires as identification. Yeah, that card.

In the meantime, identity thieves can use that number and other information to do all kinds of nasty things in your kid’s name. Your kid (and you) will never know until potentially years later when they go to open a savings account or apply for a credit card. Then the unpleasant news of their trashed credit at age 10 becomes all too clear.

Selling Your Kid’s Information

I didn’t know this until recently, but schools routinely sell student information to marketers (and anyone else) without consent. And I’m not talking about colleges and their unending onslaught of alumni credit card offers. I mean elementary and high schools. This is directly from the U.S. Department of Education:

Schools may disclose, without consent, “directory” information such as a student’s name, address, telephone number, date and place of birth, honors and awards, and dates of attendance.

You can stop schools from disclosing your kid’s personal information by filling out a Family Educational Rights and Privacy Act (FERPA) form. You have to get it directly from the school.

Remember, you can, and should, shred your credit card statements and other personal documents, but an identity thief can be just as effective, and is much less likely to be caught, by stealing a child’s identity.

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Finding room in your budget for saving and investing isn’t always easy. Here are some painless ways to find that extra couple hundred dollars per month.

1. Ask service providers like satellite TV companies and credit card companies to lower your rates. A simple call to DirecTV got me $10 off per month for a year. I just called and told them I could get such-and-such deal with Dish Network and would they lower my bill. Their response - sure; no problem. Took five minutes. If you have a credit card balance, the exact same technique can work. Call the issuing bank and simply ask them to lower your rate. Most times, they’ll do it. This technique works anywhere there’s good competition and/or customer acquisition costs are high.
2. Get quotes on auto and life insurance. Though the phrase is cliche, fifteen minutes actually can save hundreds on car insurance. It’s really easy to compare with tools like Lowermybills.com. Life insurance premiums, too, have dropped significantly over the last several years. Getting a quote is free and can save several hundred dollars per year. And you won’t necessarily have to switch insurance companies. With a better offer in hand, you can use it in the same manner as tip #1 above with your current insurer.
3. Cancel unused or underused subscriptions. Take a look at subscriptions you pay for - magazine, DVD, whatever. How much use do you really get out of them? If you’re not sure, just try living without them. Call the company and tell them to suspend your subscription for a month or two. If you don’t miss it, cancel, and don’t forget to get a refund for the remainder of your subscription. The same goes for pay TV channels like HBO.
4. Use the library. If you read or watch movies at home a lot, get acquainted with your local library. The books are surprisingly new and DVD rentals are a buck or two.
5. Review your auto insurance coverage. Check out what your deductible is, what add-ons like rental reimbursement you have, and your collision coverage. It doesn’t pay to pay for collision on older cars, so drop it and save a couple hundred bucks. Deductibles should be set as high as you feel comfortable. Check also to make sure you’re not paying for an add-on twice. By that I mean if you have AAA, it makes no sense to pay for towing through your insurance, for example.
6. Eat out once less per month. Just eating out once less per month can save decent money. For the three of us at a ‘regular’ sit-down restaurant, we’re looking at $40.
7. Pack your lunch. By eating yesterday’s leftovers for lunch every day at work, I figure I save in the neighborhood of $120 per month. Besides, it’s most likely healthier.
8. Ask for discounts. Make the most of being a AAA member or a student - ask for a discount. What’s the worst that can happen? They say no.
9. Compare prices on drugs. The legal kind. It’s shocking the variance in prices for prescription drugs from retailer to retailer. So before you fill that prescription, just call the pharmacies for a couple of different places.
10. Consider consolidating investment accounts. It’s common for investment companies to charge a quarterly ‘account maintenance fee’ for balances under some amount. We used to be charged every quarter because our mutual fund account was under $10,000. Once I consolidated, we were over their minimum amount and the charge disappeared.

None of these ideas are going to pull you back from the brink of bankruptcy, but if you’re looking for a little bit of extra room in your budget, trying one or two might do the trick.
Photo credits: fief.org, cri-dove.org, maine.com

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