Survey: Americans Mixed on GOP, Health Plans

According to a new Associated Press-Gfk poll, a slight majority of taxpayers (53%) support the campaign promise of many newly elected Republican leaders: to extend all of Bush tax cuts. However, they do not support a repeal of Obama's health care legislation.

CBN.com reports

Forty-four percent feel that only taxpayers making less than $250,000 a year should receive the cuts.

As for Obamacare, only 39 percent want to see the Republicans fulfill their pledge to kill the new health care law. Instead, 58 percent want it left alone or extended even further.

"I think everybody wants change," said Steven Lamb, 60, a Tenn. state government worker in Nashville who voted Republican last week despite opposing the party's stance on tax cuts and health care.

"I'm tired of what's going on, and the only way to do it is to make a change," he added.

Read more here

Tired of Living Paycheck to Paycheck

From CNN Money:

Question: I've been trying to be a little more thrifty lately. I realize that a lot of the luxuries Americans have are "wants" not "needs." Basically, I'd like to balance my household budget so I don't end up with just $30 at the end of the month. I'd even like to start building some savings. Any suggestions? --Kim, Idaho Falls, Idaho

Answer: A lot of people are experiencing the epiphany you've had about wants vs. needs.

Of course, we also have to keep in mind that one person's indulgence may be another's necessity. For example, a recent MainStay Investments poll that asked just over 1,000 baby boomers about their attitudes toward saving for retirement found that 46% considered weekend getaways not a luxury but a basic need.

I guess I can understand that. Someone who puts in lots of hours at a high-pressure job might very well see the occasional short trip not as an extravagance but a way to preserve sanity in a hectic life. I have to admit that I'm less sympathetic, though, to the 2% of my fellow boomers who classified professional manicures and pedicures as a basic need.

But despite individual differences in what we may consider "wants," it does appear that Americans have been rediscovering thrift of late. Last week's figures from the Bureau of Economic Analysis show that Americans saved 6.4% of after-tax income in June, the highest percentage this year. Granted, that's less than the 8.2% in May 2009. But it's a huge improvement from the 1% to 3% rates that were common back before the financial crisis.

Americans Who Swap Passports

Many American taxpayers are giving up their passports in an effort to avoid excess taxes. However, as this article from FinancialTimes.com explains, giving up your passport can result in a lot of other unintended sacrifices.

At the US Embassy in London, there is a waiting list that none of the officials likes to discuss. On the list are Americans hoping to give up their citizenship, as they seek shelter from the Internal Revenue Service.

One lawyer fighting for her clients’ right to do so is Suzanne Reisman, a former civil rights lawyer, who is now a private-client lawyer in Mayfair, central London.

“You make a lot of sacrifices when you have to pay US taxes and live outside the country for a long time. But you also make a lot of sacrifices when you give up your passport,” she says.

Having lived in London since 1998, Ms Reisman herself has considered giving up her US passport. But she probably won’t. “I don’t think I want to die in the UK,” she says.

With many executives living away from their countries of origin, the reasons to change citizenship range from clarifying tax status, making it easier to cross borders, particularly in the case of passport holders from emerging markets who find themselves working in countries such as the US for a prolonged period of time, or discovering that over time their allegiances have changed.

Continue reading at FinancialTimes.com…

More Americans Are Forfeiting Citizenship to Escape U.S. Taxes

According to the Financial Times, a significant number of Americans living outside the country are renouncing their US citizenship to avoid paying taxes on their worldwide income and gains.

As many as 743 American expatriates made the irreversible decision to discard their passports last year, according to the US government – three times as many as in 2008.

The trend was particularly noticeable in the UK, where 190,000 Americans live and work. There is a waiting list at the embassy in London for people looking to give up citizenship, with the earliest appointments in February, lawyers and accountants say.

More Americans' Credit Scores Sink to New Lows

From ABCNews.com:

The credit scores of millions more Americans are sinking to new lows.

Figures provided by FICO Inc. show that 25.5 percent of consumers — nearly 43.4 million people — now have a credit score of 599 or below, marking them as poor risks for lenders. It's unlikely they will be able to get credit cards, auto loans or mortgages under the tighter lending standards banks now use.

Because consumers relied so heavily on debt to fuel their spending in recent years, their restricted access to credit is one reason for the slow economic recovery.

"I don't get paid for loan applications, I get paid for closings," said Ritch Workman, a Melbourne, Fla., mortgage broker. "I have plenty of business, but I'm struggling to stay open."

FICO's latest analysis is based on consumer credit reports as of April. Its findings represent an increase of about 2.4 million people in the lowest credit score categories in the past two years. Before the Great Recession, scores on FICO's 300-to-850 scale weren't as volatile, said Andrew Jennings, chief research officer for FICO in Minneapolis. Historically, just 15 percent of the 170 million consumers with active credit accounts, or 25.5 million people, fell below 599, according to data posted on Myfico.com.

Why Are Weddings So Expensive? Historians Find the Answer

From WalletPop.com:

The modern American couple starts life with a heavy financial burden: In a big city like Chicago, the average wedding costs between $22,500 and $37,500. Yet in the 1930s, it was cheap, costing around $400. There's no question that wedding prices are out of control. What went wrong?

I went to the Chicago History Museum, where historians have figured out how it happened.

Timothy Long is the costume curator of the museum, which (surprisingly) is thought to have the second-largest fashion collection in the world. Decades of wealth have found a repository in the museum's stacks, including the paperwork from the legendary Marshall Field's department store, which dates to the mid-19th century and was the king of the world's department stores for generations.

While poring through the museum's holdings, Long realized something important about the modern wedding: It became a massive, ostentatious production around the time the retail pioneers at Marshall Field's decided to turn the ceremony into a consumer event for Chicago's high society.

If you want to blame someone for how much weddings cost in our society, the paperwork points to Marshall Field & Company. For example, it was the first store to implement a gift registry for brides, which encouraged friends and family to make expensive public purchases on the couple's behalf. It created low-cost knockoffs of high-fashion garments so women of every income could imitate the rich. Also, in the name of luxury and convenience, it also designed a system that took couples under its wing to sell them a range of other expensive accouterments that proved their place in society, including flatware, linens, and catering.

Our Money Survey Reveals What Matters

According to Kiplinger.com, 1000 Americans have participated in a money survey through Synovate eNation and the results regarding Americans and their money are very interesting. Knowing these answers could help you understand your customers or clients if you have a business or a product to sell. While over half of those surveyed said that recent economic challenges had caused them to better align their personal values with their financial decisions, on the flip side, the recession has taken its toll on their charitable activities. Asked if they give back either financially or through volunteer efforts, a whopping 34%said no. The survey reported some other information as well, take a look:

Americans seem to be "struggling," at least that’s how one-third of the 1,000 respondents replied when asked to describe their financial situation. Another 24% said that they were worried, versus 29% who described their financial situation as stable. What's more, 43% said their finances had gotten worse over the past two years.

Their concerns have shifted. "Not enough retirement savings" continues to top the charts, cited by about one-fifth of survey respondents. But Americans now worry more about losing their job than they did two years ago -- 18% versus 15% -- and are less concerned about credit-card debt -- 13% versus 18% two years ago.

They're less willing to take risks. A whopping three-fourths of those interviewed say recent market volatility has affected the way they handle money at least a little. And 55% are less willing to take risks with their money. "Ironically, by shunning stocks and thinking they are avoiding market-volatility risk, people are assuming the risk of simply not having enough growth in their retirement portfolio to reach their long-term goals," says Patrick Egan, director of asset management for Thrivent Financial.

To see more take a look at the article here.

More Than a Million May Lose Jobless Aid Due to Deficit Concern

From Bloomberg.com:

Since the U.S. recession began in December 2007, Congress has extended the duration of weekly unemployment benefits for the jobless three times. Now, the lawmakers may have reached their limit.

They are quietly drawing the line at 99 weeks of aid, a mark that hundreds of thousands of Americans have already reached. In coming months, the number of those who will receive their final government check is projected to top 1 million.

It’s a deadline that has rarely been mentioned in recent debates over jobless benefits, in which Republicans have delayed aid because of cost concerns. The deadline hasn’t been lost on Teauna Stephney, a 39-year-old single mother from Bothell, Washington, who said she could become homeless once her $407 weekly checks stop in June.

“What are people like me supposed to do?” said Stephney, who said almost two years of benefits haven’t proved long enough for her to find work after she lost her last job in August 2008. Referring to lawmakers, she said, “I would like them to come and talk to me and spend a day in my shoes.”

Democrats who have pushed through the past extensions agree there’s insufficient backing to go beyond 99 weeks, largely because of mounting concern over the federal deficit, projected to reach $1.5 trillion this year.

US Tax Bite Smaller than Other Nations'

From CSMonitor.com:

As millions of Americans file their tax returns this month, they can find some solace in comparing US tax rates with those in other nations. Or can they?

The United States still has a lower overall tax burden than the typical advanced economy in Europe. But the gap isn't as big as you might think, and it may be poised to shrink as the pace of federal spending ticks upward. Here's a look at how Americans' tax burden ranks against that of citizens of other countries, and why it matters.

How do US tax rates compare with those in other nations?

The average American pays wage-based taxes that are similar to what Britons pay – and not much lower than in France. Japanese citizens enjoy the lowest rates among the Group of Seven large industrial economies, or G-7. This includes national and local income taxes, plus payroll levies such as the employee share of Social Security.

But wage and payroll taxes are just part of the picture. Add in sales taxes, capital gains taxes, property taxes, and corporate taxes, and the US sends 28 cents of every dollar of output to the government. That still matches Japan for the lowest ratio of tax revenue to gross domestic product (GDP) among the G-7 nations. France and Italy score highest.

Poll: More Americans Say Their Taxes Fair

According to a new poll from CBS News, the average taxpayer’s opinion on how fair the U.S. tax system is depends a lot on how much money you make. The survey found that 50% of Americans think the amount they pay the government in taxes is fair, which is a slight decrease from the last few years.

The percentage who think they pay more than their fair share in taxes has risen from 37% three years ago to 43%.

Back in 1997 Americans viewed the amount of taxes they paid as even less fair. Then, 49% said they were paying more than their fair share of federal income taxes, while 47% said they paid the right amount.

To establish this data CBS polled over 850 random adults in the country using random phone numbers to find participants. If you would like to see more about their methodology, or checkout the full study then head over to CBS News.com.

8 Do's and Don'ts For Your 401k

From MSNMoney.com:

When it comes to saving for retirement and building a portfolio to last a lifetime, most Americans are way behind the eight ball -- and the nine ball and just about every other ball on the pool table.

More than 54% of Americans report that the total value of their household savings and investments, excluding the value of their primary homes and any defined-benefit plans, is less than $25,000, according to the Employee Benefit Research Institute's annual Retirement Confidence Survey. What's worse, 27% have less than $1,000 in assets. Just 11% have more than $250,000 set aside.

Yes, those figures include Americans young and old, those just heading into the working world as well as those about to check out of it. But in the main, Americans need to modify their savings and spending patterns to have any hope of enjoying a standard of living to which, rightly or wrongly, they've become accustomed.

It's not rocket science, at least not according to experts. Here are some nest egg do's and don'ts from Hewitt Associates and Merrill Lynch.

1. Participate in your plan

If you're lucky enough to have a 401k at work, contribute to it. That will greatly improve your financial well-being, according to Bank of America Merrill Lynch, which recently introduced a new tool designed to monitor and score the "financial wellness" of 401k plans in general and, by extension, the employees who participate in them.

The new tool looks at four plan-participant behaviors: saving, investing, setting and monitoring retirement goals, and nest-egg preservation. Not surprisingly, savings and investing behavior -- which represent 80% of the overall score -- are the primary drivers of financial wellness.

5 Myths About your Taxes

From the Washington Post:

1. The poorest and the richest Americans pay no taxes.

About 45 percent of households will owe no federal income tax in 2010, according to our estimates. Half of them earn too little, while the other half -- mostly middle- and lower-income households -- will take advantage of tax credits such as the earned income credit, the child and child-care credits, the American Opportunity and Lifetime Learning credits, which help pay for college, and the saver's credit, which subsidizes retirement saving.

But even citizens who pay no income tax still pay other kinds of taxes. They pay Social Security and Medicare taxes when they work, sales taxes when they buy things and property taxes on their homes. Drivers pay gasoline taxes, and smokers and drinkers pay excise taxes on tobacco and alcohol. According to our research, more than 75 percent of us will pay at least some form of federal tax in 2010.

Those who pay no federal taxes are mostly the low-income elderly or very poor families with children. Even about half of those with annual incomes under $10,000 pay some federal tax, most often payroll taxes on wages.

And yes, the richest Americans pay taxes, too. Though a tiny minority manage to avoid federal income tax through elaborate tax planning, 99.7 percent of those with annual incomes above $1 million will pay federal taxes this year, surrendering 27 percent of their earnings to the government. The average American taxpayer pays 18 percent.

2. Americans are overtaxed.

In 2007, federal, state and local taxes claimed about $3.8 trillion, or 27 percent of U.S. gross domestic product. That's nearly $13,000 for every American. Two-thirds of tax revenues went to the federal government.

Continue reading at WashingtonPost.com…

Americans Remain Skeptical Over Health-Care Revamp

From Bloomberg.com:

Americans remain skeptical about the health-care overhaul even after the U.S. House passed landmark legislation that promises to provide access to medical coverage for tens of millions of the uninsured.

At the same time, most say the government should play a role in ensuring everyone has access to affordable care, a Bloomberg National Poll shows. A majority also agree that health care is a private matter and consider the new rules approved by Congress to be a government takeover.

The poll found the percentage of Americans who favor the almost $1 trillion 10-year plan remained at about just four in 10 following the House vote on March 21 to send the bill to President Barack Obama, who signed it into law today.

“Anything called a ‘massive overhaul’ will be complicated, and it is hard for people to see what is in it for them,” said J. Ann Selzer, president of Selzer & Co., a Des Moines, Iowa- based firm that conducted the nationwide survey. “Even as Americans of all stripes agree there are problems with the current system, the escalating deficit makes them worry what the country can really afford.”

The poll of 1,002 adults was conducted March 19-22 and has a margin of error of plus or minus 3.1 percent. There was no meaningful movement of opinion the final night of interviewing, after the vote was taken.

Democratic lawmakers who approved the revamp over the unanimous objections of Republicans are counting on public support to grow once voters see the benefits of the legislation, which places new restrictions on insurers from denying coverage to people.

Report: Americans More Stressed About Finances

Even though the housing market seems to be improving and the trouble on Wall Street has settled down, reports are showing that Americans are more stressed now about their finances than they have been in nearly a year. As such, consumer confidence is at a yearly low (38.1) according to the September Consumer Reports Index. Check out the following article explaining why confidence is continuing to decline courtesy of Biz Journals.com.

Increased credit card, health care and personal loan issues are the drivers behind their dour demeanor.

When the index is greater than 50, more consumers are feeling positive about their situation. When it is below 50, more consumers are feeling worse.

On a positive note, shopping for big-ticket items such as a home or car looks strong for September, the report noted.

"Despite the negative forces consumers are facing, we have seen some stabilization and improvement in key indicators that suggest we could see an improvement in consumer sentiment over the next month," said Ed Farrell, director of the Consumer Reports National Research Center.

Consumer Reports Trouble Tracker found almost 38 percent of Americans have experienced at least one major negative personal finance event in the last 30 days.

Rise of the Super-Rich Hits a Sobering Wall

From the New York Times:

The rich have been getting richer for so long that the trend has come to seem almost permanent.

They began to pull away from everyone else in the 1970s. By 2006, income was more concentrated at the top than it had been since the late 1920s. The recent news about resurgent Wall Street pay has seemed to suggest that not even the Great Recession could reverse the rise in income inequality.

But economists say — and data is beginning to show — that a significant change may in fact be under way. The rich, as a group, are no longer getting richer. Over the last two years, they have become poorer. And many may not return to their old levels of wealth and income anytime soon.

For every investment banker whose pay has recovered to its prerecession levels, there are several who have lost their jobs — as well as many wealthy investors who have lost millions. As a result, economists and other analysts say, a 30-year period in which the super-rich became both wealthier and more numerous may now be ending.

The relative struggles of the rich may elicit little sympathy from less well-off families who are dealing with the effects of the worst recession in a generation. But the change does raise several broader economic questions. Among them is whether harder times for the rich will ultimately benefit the middle class and the poor, given that the huge recent increase in top incomes coincided with slow income growth for almost every other group. In blunter terms, the question is whether the better metaphor for the economy is a rising tide that can lift all boats — or a zero-sum game.

More Americans Wary Of Tax Man This Year

From Reuters.com:

As a deep recession strips Americans of their jobs, homes and investments, the 2009 U.S. tax season promises to see a large uptick in first-time delinquent income taxpayers.

"Our calls are up 280 percent," said Richard Boggs, founder and chief executive of Los Angeles-based Nationwide Tax Relief, a firm that helps delinquent taxpayers resolve tax issues.

"We've seen a huge rise in what we call the rookie delinquent taxpayer," he said. "They are incredibly scared, and they have no idea what's going to happen to them because, God bless them, they've never owed before."

As the weak economy puts job security and a steady flow of income on a slippery slope, many are wary of the U.S. tax man, tax consultants say.

With household balance sheets under pressure, more U.S. households are having trouble keeping up with their day-to-day bills and struggling to pay their taxes.

"Folks are not paying their taxes because they are spending it on necessary living expenses," said Kristin Lavieri, an accountant with Weinstein & Anastasio, PC in Hamden, Connecticut.

She added that more of the self-employed, who are required to pay taxes each quarter, are likely to end up with back taxes. "When there is not enough money for general operating expenses, there most definitely isn't going to be enough for quarterly estimates," Lavieri said.

Among those not self-employed, many also have to make tough decisions that could carry long-term financial consequences.

Many withdrew funds from 401k and IRA retirement savings accounts before the permitted time, unaware of the punitive taxes and penalties this would generate, said Larry Walker Jr., president of the financial and tax services firm 4-Serenity Inc in Snellville, Georgia.

Withdrawals from a retirement account before reaching the age of 59.5 are considered taxable income and generally incur an additional tax of 10 percent of the amount.

Other taxpayers did not have enough tax withheld from paychecks. As a result, they now owe taxes or will not receive the amount of refund they usually do, Walker said.

U.S. Workers are Worse Off

According to a new study from Rutgers University, American workers are worse off than they have been in years. The study finds that more than 10% of the country is currently unemployed, or underemployed. This number represents a huge increase from last year, and is a bad indicator for our economy.

The study also had a few more interesting statistics about the economy which are outlined below.

• About 530,000 were subject to mass layoffs in the last year, growth of nearly 5 percent but a lower rate than five and 10 years ago.
• The median weekly earnings for American workers have not grown in real terms over the past eight years.
• At $6.55, the federal minimum wage is worth 40 cents less per hour, in inflation-adjusted dollars, than it was a decade ago.
• Although employer-assisted child care and employee wellness programs have grown quickly over the past decade, they still cover less than one quarter of American workers.
• Roughly 4 percent of the work force wants to work full-time but is working part time because they can't find full-time work.

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AMT Advice

The alternative minimum tax was created in 1969 to catch wealthy Americans who were avoiding paying their fair share of income taxes. Today, the AMT is now a taxing mechanism that adversely affects middle class Americans. For more information on the AMT check out Yahoo News.