Does money affect your relationship?

We’ve all been there. A friend or relative approaches us a little down on his luck. The bills are piling up and they need a couple hundred dollars to get through payday. It’s an uncomfortable situation for both parties. For the person needing the money, they feel the humiliation of admitting they haven’t been able to keep their finances in order. For the potential lender, it’s a feeling of having to weigh the value of personal relationships with financial necessities.Click here for the fastest cash in town!!

  
How do you handle such a situation? Because every situation is as different as the people involved, it’s impossible to create a precise set of rules about lending money to personal friends or relatives. However, there are a few pitfalls you can look out for.
   
First, even though the situation is awkward, don’t avoid communicating clearly about expectations. If you simply do not want to lend the money, for any reason you choose, be direct and up front about your reasons. If you come across as indecisive, or make unlikely excuses, like not being able to afford it if it’s obvious that you can, it simply makes the situation more awkward for you and more humiliating for your friend.
   
Remember, this is your money we’re talking about, so you can decline the request for any reason. You can simply say you don’t lend money to friends.Get on the path to financial security with Debt.com.

   
If you do decide to make the loan, be extremely clear about what you want in return. Tell them you expect to be paid a certain amount every week until the money is paid off. Or ask them for some collateral. After all, you’re granting this person a tremendous favor by lending them money. It would be unreasonable of them to be offended by such a request.
   
Another option is to lend the money with the expectation that it will never be repaid. Be extremely careful under these circumstances, and only make such a loan to a close relative, such as a child or sibling. By not expecting repayment, you protect yourself from feeling resentful down the road. And if you are ever repaid, you can consider it a surprise.



 
 Here at Being Broke Sucks, we would also advise anyone considering asking for money from a friend or relative to only do so in case of a dire emergency. If you do this every time you’re just a little short, you gain a reputation as someone who’s always asking for money. You’re better off trying to work out an arrangement with your creditors.
   
The biggest problem, when money becomes an issue within a relationship is that it tends to become the defining issue, especially if a loan is never repaid. That’s why many people simply refuse to lend money to friends. It’s because they don’t want to lose the friendship.Increase Your Credit Score!

   
By communicating clearly about your expectations and needs, and not internalizing everything as a personal issue, you can almost separate your personal relationship from the financial transaction that has taken place. Otherwise, every interaction becomes a discussion about the money that is owed, and the discomfort forms a wedge between the two people.

What is Debt Settlement?

What is Debt Settlement? Find out at DebtSettlement.com
Debt settlement, also known as debt arbitration or debt negotiation is an approach to debt reduction in which the debtor and creditor agree on a reduced balance that will be regarded as payment in full.Get connected to Credit Counseling Services with Debt.com

The history of debt settlement as a concept, and in practice, dates back to the beginning of the monetary system and the establishment of lending institutions.

In America and through the world we can trace its history to the great depression which created a flurry of debt settlement activities within consumer lending practices and established the concept of debt settlement as an option which became a common practice among business and consumers during the 1930s.

There is no accurate estimate in history as to the number of settlements, but we estimate the figures in the millions. After the great depression the practice continued though not encouraged.

As a concept, lenders have been practicing debt settlement thousands of years. However, the business of debt settlement became prominent in America during the late 1980s and early 1990s when bank deregulation, which loosened consumer lending practices, followed by an economic recession placed consumers in financial hardships.
With charge-offs (debts written-off by banks) increasing, banks established debt settlement departments staffed with personnel who were authorized to negotiate with defaulted cardholders to reduce the outstanding balances in hopes to recover funds that would otherwise be lost if the cardholder filed for Chapter 7 bankruptcy. Avoid Bankruptcy! Get help today with DebtSettlement.com
Typical settlements ranged between 25% and 65% of the outstanding balance  
Alongside the unprecedented spike in personal debt loads, there has been another rather significant (even if criminally under reported) change – the 2005 passage of legislation that dramatically worsened the chances for average Americans to claim Chapter 7 bankruptcy protection. As things stand, should anyone filing for bankruptcy fail to meet the Internal Revenue Service regulated ‘means test’, they would instead be shelved into the Chapter 13 debt restructuring plan. Essentially, Chapter 13 bankruptcies simply tell borrowers that they must pay back some or all of their debts to all unsecured lenders. Repayments under Chapter 13 can range from 1% to 100% of the amounts owed to unsecured creditors, based on the ability of the debtor to pay. Repayment periods are 3 years (for those who earn below the median income) or 5 years (for those above), under court mandated budgets that follow IRS guidelines, and the penalties for failure are more severe.
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Essentially, the debt settlement company negotiates on the borrowers’ behalf with creditors to reduce the overall debts in exchange for an agreement upon regular payments to be made. Only credit card debts can be handled, not student loans, auto financing or mortgages. For the debtor, this makes obvious sense – they avoid the stigma and intrusive court-mandated controls of bankruptcy while still lowering, sometimes by more than 50%, their debt balances. Whereas, for the creditor, they regain trust that the borrower intends to pay back what he can of the loans and not file bankruptcy (in which case, the creditor risks losing all monies owed).



There are obvious drawbacks – credit reports will show evidence of debt settlements and the associated FICO scores will be lowered as a result. Get FICO Score Watch Now!
There’s always the possibility of lawsuit whenever debts lay unpaid. Since few creditors wish to push borrowers toward bankruptcy – and the potential of governmental protection against all debts. In addition, the specific debts of the borrowers themselves affect the success of negotiations. Tax liens or domestic judgments, for reasons that should be clear, remain unaffected by attempts at settlement. Student loans, even those not federally subsidized, have been granted special powers by recent legislation to attach bank accounts without possibility of Chapter 7 bankruptcy protection. Also, some individual creditors, including Discover Card, for example, tend to have an aggressive resistance against negotiations.



In order to work with a debt settlement company, a consumer needs lump sum cash (best scenario), or build up enough funds over pre-determined period of time. Once enough funds are built up the negotiation process can begin with each creditor individually. Accounts can be held by credit card companies or may be sold to collections agency for average of $0.15 on the dollar. In which case debt can still be negotiated. The debt settlement company negotiates with the credit card companies for 35% - 50% of the existing balances. The debt settlement companies typically have built up a relationship during their normal business practices with the credit card companies and can come to a settlement agreement quickly. Once the consumer pays the agreed upon amount, the debt settlement companies take a percentage of the savings of the forgiven debt as the fee. With the current economic crisis, more and more credit card companies may be willing to settle existing credit card debts rather add to their already large written off bad debt.


 What the Creditors get out of it

The creditor’s primary incentive is to recover funds that would otherwise be lost if the debtor filed for bankruptcy. The other key incentive is that the creditor can often recover more funds than through other collection methods. Collection agencies and collection attorneys charge commissions as high as 40% on recovered funds. Bad debt purchasers buy portfolios of delinquent debts from creditors who give up on internal collection efforts and these bad debt purchasers pay between 1 and 12 cents on the dollar, depending on the age of the debt, with the oldest debts the cheapest.Collection calls and lawsuits often push debtors into bankruptcy, in which case the creditor often recovers no funds.

How to stay afloat when you are unemployed

The job market is shrinking during this current economic downturn. Job loss can be devastating both emotionally as well as financially for the hundreds of workers who are told weekly that their jobs will be terminated. It is one of life's most traumatic experiences, often causing feelings of anger, anxiety, and hopelessness. How you react to job loss will actually make or break your search for new employment. The reality of job loss is dealing with practical and emotional losses: practical loss is the loss of income and benefits until employed again. Emotionally, job loss may damage the self-image and worth while fears about the future and the ability to meet financial commitments may be overwhelming. Many worry about how they are viewed by others. Some even look to Cash Next Business Day!
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 Recovering and rebuilding after job loss

Seeking and finding a job without recognizing, understanding, and addressing emotional consequences may destabilize successful recovery. Recovery after a job loss is thus the ability to work through a challenging time without becoming overcome by circumstances, swept away by emotions, or feeling defeated.

The stages of recovery and rebuilding

Recovery after job loss can be viewed as a series of stages, each with a goal and tasks. It helps people understand their experience as a process that develops and changes over time, and can help them to maintain their self-control even when they may feel anxious and unconfident.

Stage one: Accepting reality and coping

Job loss is often quite shocking. This stage begins with a sense of bafflement as people are totally taken aback by this turn of events. Recognizing what you are feeling is the first step toward relief. The main goal of this stage is to survive this initial phase without doing anything damaging to self, future options, or relationships. It is important to adjust yourself to this new reality, handle instant emotional response, deal with issues of self-esteem and humiliation and simultaneously cope with family issues.

Stage two: Surviving

On entering the second stage, disillusionment begins to fade. People begin to deal with issues of survival and emotional and financial stability. This stage involves laying the foundation upon which people will re-build their lives, and includes emotional, practical, and financial tasks.

Stage three: Formulating a plan

Formulating a plan gives you a systematic and step-by-step guide on what to do and when. The primary goal of this stage is the assessment of needs, skills, and dreams, and primary tasks include taking stock of life, assessing choices, developing plans and re-building self image.

Stage four: Decision making and self renewal

It represents the end of this journey; from basic recovery to self-renewal and self-determination, and involves the active implementation of decisions, accepting personal responsibility, taking emotional risks and re-gaining self confidence.

Rebuilding after job loss is a process that takes place only over time. The amount of time will depend on the personality of the individual, his or her approach to life, resilience, and support system.

Tips for recovering from job loss

Steps to overcome the feelings of hopelessness and desperation that frequently accompany job loss:

Understand the stages of loss

It is quite likely for a worker to go through stages of loss after a layoff. These stages are often similar to those you experience after losing a loved one: shock, denial, anger, bargaining, depression, and finally, acceptance. Recognizing these stages will help you get back on your feet more quickly.

Recover gracefully

As with any loss, there will be a recovery period. Feelings of anger or sadness may last weeks or may be even months. Give yourself time to grieve the loss, and express your feelings in healthy ways so they will pass more quickly. Even though you may be restructuring your life around an imposed career change, it is important to acknowledge your grief.Lexington Law Firm

Keep a diary

Keep a record of how you feel, both good and bad, for at least a month. Confronting your hurt, frustration, and fears may be the first step to healing the hurt. Equally important are remembering successes experienced on the previous job, the good times you had with coworkers, and the characteristics you like most about yourself.

Stay motivated

Keeping grounded is key. Volunteering, formal classes, and exercising at the gym are excellent ways to build structure into your days and may provide that important lead to the next job.

Going to the gym two or three times a week help to deal with a lot of stress. Vigorous exercise reduces  the day-to-day irritants. It also helps you relax and become mentally focused.

Develop your roadmap

Develop a vision of where you want to be and compare this to where you are in the present times. This will help you identify the gaps that will provide the foundation of your roadmap. A roadmap helps determine your “best fit” course of action, based on your circumstances and vision. It outlines the strategies that you should use to help you get a new job or help your company through the economic slow down.

Form a temporary routine till your next job

Form a new (temporary) daily routine to follow until you find your next job. Routines help clear the mind, keep productivity high, and promote a feeling of usefulness.

Find support

Form a support group among your friends and family. It is helpful knowing that you are not alone and that the feelings you are having are normal. Being around others is a very important part of the healing process. These individuals may also provide valuable leads on prospective jobs.

Look for a new job 

Get organized by making a list of all available organizations, companies, and agencies within driving distance. Revise your resume and begin knocking on doors, making phone calls, and writing letters of application.

It is always important to remember that dealing with a job loss is not easy; it happens to most and to the best. The key to recovering is recovering with grace and dignity.

If You Really Want To Get Out Of Debt....

Now, there isn’t one way to get out of debt, and the best program should be tailored to each person’s individual situation. But if you feel like you just don’t know how to begin, this program is designed to give you a sort of guide — one that should be adjusted to fit your financial situation.



It’s aimed not at people who have their finances together and are just trying to pay off a credit card or two. It’s aimed at those who have trouble finding any extra money to pay off debts, who seem to find themselves getting deeper and deeper into debt, and don’t know how to stop it. In other words, it’s a bit of an emergency program.

Disclaimer: I’m not a financial advisor, and if you are in need of one, I suggest you find a qualified advisor. My only qualification is that I’ve made great strides in getting my finances under control, in starting an emergency fund, in paying all my bills on time, in not getting further into debt, and in eliminating my debt (I should be done by the end of this year). This program is based on my experiences, and on the large number of books and websites I’ve read.

Being Broke Sucks provides a 12 step get out of debt plan!!

1. Acknowledge the problem. The first step is admitting you have a problem. The first week, all you have to do is say to yourself, “I have a problem with debt. I got into this because I spend money I don’t have. But I believe that there’s a way out, and I can do this. I can control my spending, make a plan, and slowly get out of debt.” That’s a major step. Now set aside just 30-60 minutes a week to deal with your finances — make it a set day and time, and don’t let yourself miss this appointment.

2. Stop digging. If you’re in a hole, the first step is to stop digging, and that’s what you’re going to do this second week. For 30 days, see if you can stop any non-essential spending. If you have a major problem with credit cards, cut them up. If you’re not so bad with credit cards, at least put them away and don’t buy stuff online for one month. What’s essential? Obviously your bills, housing, auto, gas, groceries … that kind of stuff. Non-essential? Clothing, CDs, DVDs, books, magazines, gadgets … you know what I mean. Just 30 days. After that, you can decide how much to spend on these things.

3. Make small cutbacks. This third week, take a look at things you normally buy and see if you can cut out a few of them, or spend less on them. Groceries? See if you can buy house brands instead of name brands. Coffee? Make it yourself at home instead of buying out. Lunch? Try packing it to work instead of eating out. Add up what your cutbacks will save you this month.

4. Start an emergency fund. This fourth week, set up a savings account, if you don’t have one already, for an emergency fund. Now take the amount you saved in Step 3 (and even in Step 2 if you think you can make them last for awhile) and set up a regular automatic deposit from your checking to this emergency fund savings account for this amount. It’s important that before you start paying off debt, you have at least a small emergency fund. Aim for $1,000 at first, and you can grow that later. The reason: if unexpected expenses come up, and you don’t have an emergency fund, you will skip your debt payments to pay for the unexpected expenses. The emergency fund protects your debt payments.




5. Take inventory. OK, this is a step that we don’t like to take. But take a deep breath. You need to do this. Remember what you said in Step 1? You can do this. This fifth week, set up a simple spreadsheet. In one column, list all of your debts — credit cards, medical bills, auto loan, etc. You can leave out your mortgage, but put everything else. In the second column, put the amounts you owe for each debt. In the third, put the minimum monthly payment, and put the percentage interest in the fourth column. Total up the second and third columns to see your total debt owed and how much you have to pay, at a minimum, towards debt each month.

6. Make a spending plan. We don’t like to do this step either. But it’s not going to be as painful as we think. This sixth week, set up another simple spreadsheet. In one column, list your monthly bills (rent or mortgage, auto payment, utilities, cable, etc.) — everything that is a regular monthly expense. Then list variable expenses (things that change every month) like groceries, gas, eating out, etc. Later you should add irregular expenses (stuff that comes up once in awhile — less than once a month) such as auto and house maintenance, clothing, insurance, etc. But we won’t get into that now, as we want to keep it simple. In the second column, put down the amounts for each. Be sure to put enough for things like gas and groceries, as you don’t want to be short. Be sure to also include your minimum debt payments and your emergency fund deposit. Now, list your income sources and monthly amounts. There. You’ve got a temporary spending plan (you’ll want to add the irregular expenses later). Now, if the expenses are greater than the income, you’ll need to make adjustments until the expenses are equal to or less than the income.




7. Control spending. If you’re into your seventh week of this debt plan, you may find it hard to keep track of your spending and ensure that you’re sticking to your spending plan. Here’s the key: first do the emergency fund deposit. Then do the debt payments. Then do your monthly bills. Then withdraw the variable amounts in cash, and put them into separate envelopes. It’s old-fashioned, but it works, as you don’t have to worry about overspending. When your envelope is empty, you can’t spend anymore. Continue to cut back on non-essential spending as much as you can at this point, so you’re able to stick within your spending plan.



8. Pay bills on time. This may be a problem for a lot of people. It’s important, if you want to get out of debt, to start paying all your bills on time. If you follow the payment plan outlined in Step 7, your bills should be paid before you get to any discretionary spending categories. At this point, you want to focus on getting those bills paid on time, and making it a habit. If you have trouble remembering, try one of these methods: 1) pay bills as soon as they come in — take them to the computer and pay them online, or write out a check and prepare the envelope to be mailed the next day; or 2) set up a reminder in your calendar program to tell you when bills are due.

9. Start a snowball. Now that your finances are relatively under control, you can start a debt snowball. At this point, you should have the beginnings of an emergency fund, you should know how much you owe, you should have a temporary spending plan, you should be paying bills on time and controlling your spending. Now you can focus on paying your debt. Here’s what to do: If you can find at least $100 from your spending plan, use that to start your debt snowball. You may need to cut back on discretionary spending (as you did in Steps 2 and 3). Or, once your emergency fund is at $1,000, you can use the amount you were putting into that account for your debt snowball. If you have trouble finding $100 for a debt snowball, you need to look at what other expenses you can cut back on. OK, once you’ve found at least $100 for your debt snowball (and more would be better), take a look at your debt spreadsheet. First, order the debts from the smallest amount owed to the largest. Now, look at your smallest debt owed — you will start by paying $100 (your debt snowball) plus the minimum monthly payment on that debt each month, until the debt is paid off. When the debt is paid off, you will take the amount you were paying on it (let’s say $50 monthly payment plus the $100 debt snowball for a total of $150) and pay it to your next smallest debt, until it is paid off. Continue to pay off your debts, one at a time, until they are all paid off. Now you have a large sum you can put into growing your emergency fund, and funding your irregular expenses, and finally start investing.

10. Find larger cuts. Once you’ve controlled your finances and started your debt snowball, there are ways to increase the snowball — and hence the speed with which you get out of debt. Look at your larger expenses — are there ways you can eliminate or cut back on them? Can you sell your car for a smaller, used model? Can you find a smaller house or apartment to rent? Can you sell your house and rent a cheaper one? Can you get by with one car? Can you eliminate some services you’ve been using?
Whatever cuts you make, apply that amount to your debt snowball — don’t spend it.

11. Grow your income. Another great way to get out of debt faster is to make more money. Look at ways you can make money on the side — or ask for a raise or get a better job. Take 30 minutes to brainstorm. Are there ways you can start a small business online? Sell your valuables on eBay? Start freelancing on the side? Get a part-time job? This only has to be temporary, but the more money you make, the faster you’ll get out of debt. Be sure to apply your new income to your debt snowball.

12. Track your progress. On your debt spreadsheet, be sure to update it every payday (or however often you pay debt) so that you can see your shrinking debt amount. You should be able to calculate how many months you have left before you’re completely out of debt. It may be a long ways off, but it’s within sight!



Bonus step: Celebrate! It’s important to celebrate, not only when you’re out of debt, but along the way as you eliminate each debt. Have fun! Make this an adventure. It can be amazingly satisfying to stop spending and gain control of your finances instead. Find free entertainment, make it a challenge to be frugal and save money and find cheap used stuff. Pat yourself on the back along the way.

Recession over?! Did Obama do it?

Larger-than-expected gains in U.S. housing prices and consumer confidence on Tuesday lent new weight to views that the economy is emerging from the longest recession since the 1930s.
U.S. single-family home prices rose for the second month in a row in June, according to a closely watched index, and consumer confidence jumped in August.
In addition, President Barack Obama nominated Ben Bernanke to a second term as chairman of the Federal Reserve, removing some niggling doubt from investors' minds. The move promised a consistent approach to monetary policy in the years ahead.
The developments helped buffer the blow of projections for the U.S. budget deficit to reach its highest level in 2009, relative to the total economy, since World War Two.
"The recession appears to be over, with consumer attitudes lagging behind broad economic developments," said Steven Wood, chief economist at Insight Economics in Danville, California.



Major U.S. equities indexes closed higher after briefly hitting new 2009 highs on the day's events. Treasury bond prices initially fell as signs of a resurgent economy reduced interest in safer investments, but later rose after decent demand for an auction of two-year notes.
The Conference Board, an industry group, said consumer confidence climbed to a reading of 54.1 in August from 47.4 in July, handily beating forecasts, on an improved outlook for the job market and the overall economy.
The rise sent the index to its highest level since May. Still, some analysts warned not to get carried away.
"Confidence remains well below its historical average of 95 and it has not even regained the level of 61 seen before the collapse of Lehman almost a year ago," said Paul Dales, U.S. economist at Capital Economics in Toronto.
The weak labor market remains a sticking point to recovery, and especially a revival in consumer spending. Even the Fed has conceded the likelihood of a "jobless recovery," with the unemployment rate staying high long after growth resumes.
Americans saying that jobs were "hard to get" in August dropped to 45.1 percent from 48.5 percent but only 4.2 percent said jobs were plentiful.
"Most of the strength was in the 'expectations' component, so it looks like even though the near-term conditions are still a bit rocky, there is hope for the future," said Kim Rupert, managing director, global fixed income analysis, Action Economics LLC in San Francisco.




HOUSING PRICES IN BROAD-BASED GAINS
Other data supporting recovery hopes came from the Standard & Poor's/Case-Shiller housing price index. The housing market is considered a critical component to an economic recovery.
Prices of U.S. single family homes rose by 1.4 percent in June from May, after creeping up by 0.5 percent in April, suggesting the crippling housing slump is easing.
The Case-Shiller 10- and 20-city indexes have plunged by 54.3 percent and 45.3 percent, respectively, from their 2006 peaks.
June's improvement was broad based, with 18 of 20 metropolitan areas logging gains for the month.
"The most important take-away is the breadth of the rise," said Adam York, economist at Wells Fargo Securities in Charlotte, North Carolina. "The absolute worst is behind us."
Separately, the Federal Housing Finance Authority said U.S. home prices rose by 0.5 percent in June, according to its seasonally-adjusted monthly index, while prices fell by 0.7 percent in the second quarter.
"The S&P/Case-Shiller report dovetails with evidence from the FHFA house price index and the National Association of Realtors existing home sales report, suggesting that house price deflation has bottomed," said Anna Piretti, economist at BNP Paribas in New York.



BEN'S BACK
Bernanke's reappointment, while widely expected, was seen as a plus for markets that feared new uncertainty at a time the U.S. economic ship is finally righting itself.
Fed officials have warned that politicizing the U.S. central bank risked higher long-term interest rates as investors began to fear higher inflation taking root.
"Were Bernanke to be denied a second term in favor of, say, a current White House 'insider,' this would inevitably add to concerns about the blurring of lines between fiscal and monetary policy and the potential compromising of Fed independence," said strategists at analysis firm 4CAST Ltd.



For the time being, though, Bernanke & Company still face deflationary pressure from the huge "output gap" in the U.S. economy created by the deep recession.
"The news that the deflation-conscious Bernanke is going to be at the helm .... provides tentative support to our view that the zero-interest rate policy will remain in place until 2011 at the earliest," said Capital Economics' Dales.
The nonpartisan Congressional Budget Office (CBO) on Tuesday gave updated projections on the likely U.S. budget deficit in fiscal 2009 and beyond.
Spiraling deficit forecasts stretching far into the future have been cited as one element behind a dip in Obama's polling numbers, as Americans start to fear that tax hikes will almost inevitably follow.
The CBO forecast a fiscal 2009 deficit at $1.59 trillion, or 11.2 percent of projected gross domestic product, falling to $1.4 trillion or 9.6 percent of GDP in 2010.
It gave a 10-year deficit forecast of $7.14 trillion against $9.1 trillion.
Separately, the White House raised its forecast for the budget deficit between 2010 and 2019 to a total of about $9 trillion.

Do you have faith in the economy?

Consumer sentiment rose more than expected in August and expectations hit the highest level since the recession began, indications that Americans' pessimism about the economy may be lifting.





The housing sector also showed signs of life as a national measure of home prices posted its first quarterly increase in three years.
The New York-based Conference Board said Tuesday its Consumer Confidence index rose to 54.1 from an upwardly revised 47.4 in July. Economists surveyed by Thomson Reuters had expected a slight increase to 47.5.
Still, the index is well below 90, the minimum level associated with a healthy economy. Anything above 100 signals strong growth.
Economists closely monitor confidence because consumer spending accounts for about 70 percent of U.S. economic activity. Consumer sentiment — fueled by signs the economy is stabilizing — has recovered a bit since hitting a record-low of 25.3 in February.
Many analysts expect the economy to grow 2-3 percent in the current July-September quarter, spurred by a more stable housing market and the Cash for Clunkers program, which has boosted auto sales.
But economists worry that without healthier consumer spending, the recovery may weaken next year.




The housing slump and a weak job market have made consumers reluctant to spend. But the outlook for jobs is improving, the Conference Board said, with fewer respondents saying positions are "hard to get," and more claiming they are "plentiful."
Consumers' expectations for the economy over the next six months rose to 73.5 from 63.4 in July, the highest level since December 2007, when the recession began. The consumer confidence survey was sent to 5,000 households and had a cutoff date for responses of August 18.
Sal Guatieri, an economist at BMO Capital Markets, said the jump in the expectations index meant consumers likely will spend more in the months ahead.
"It won't be a smooth ride, but with consumer confidence now tracking higher, the groundwork for a sustainable recovery appears to be in place," he wrote in a note to clients.




The housing sector also received positive news. The Standard & Poor's/Case-Shiller's U.S. National Home Price Index rose 1.4 percent in the second quarter from the January-March period, the first quarterly increase in three years. Home prices, while still down almost 15 percent from last year, are at levels last seen in early 2003.
The reports, along with President Barack Obama's reappointment of Ben Bernanke as Federal Reserve chief, sent the financial markets higher. The Dow Jones industrial average rose more than 80 points in midday trading, and broader indices also gained.
Obama said Tuesday that his administration's $787 billion stimulus package, and the extraordinary efforts by Bernanke to pump trillions of dollars into the financial system, have helped turn the economy around.
"Our auto industry is showing signs of life," Obama said. "Business investment is showing signs of stabilizing. Our housing market and credit markets have been saved from collapse."
Jobs are a weak spot, however, and could limit future consumer spending if Americans remain concerned about layoffs or declining wages.



Still, the Labor Department reported earlier this month that the unemployment rate dipped for the first time in 15 months, and workers' hours and pay rose slightly in July. The unemployment rate slipped to 9.4 percent, from 9.5 percent, while July job losses slowed to a total of 247,000, the fewest in a year and a big improvement from June's 443,000.

Being Broke Sucks: Short term savings solutions

Calculate how much you spend every month

The first rule of savings is to bank enough to cover the necessities if -- knock on wood -- an emergency arises. How much do you need? Well, how much do you spend on a monthly basis?
Add up what you spend each month on necessities such as food, shelter, transportation to work, and anything that you promised to buy your kids. (If you're not into keeping detailed records, there are online program like Quicken or from mint.com to help you if keeping records in not your strong point.

Add some padding for "just-in-case" scenarios

There are small emergencies (bad perm) and big ones (job loss). Bump up your monthly spending number a tad to account for things like job-hunting expenses, should you suddenly find yourself in need of a new gig. Then multiply that figure by three or six (for the number of months that you want to cover), factoring in other available monetary resources and the number of people for whom you're financially responsible

Gaze into your 1- to 5-year "big expenditures" crystal ball

With your emergency savings covered, now it's time to figure out what other kind of cash you should put aside. Planning a renovation, extreme dental work or a family vacation? These things are also part of your short-term savings strategy. Put 'em down on paper and estimate how much these purchases will cost

Figure out how quickly you will meet this goal

You want to fund your cash kitty ASAP (emergency expenses tend not to wait around until it's convenient). Come up with an amount you can afford to contribute each month. Make it one of those must-pay expenses -- just like your electric bill and grocery money. Yes, it's that important. Once the emergency stash is stashed, move on to the non-emergency short-term savings goals

Pick a parking spot for your cash

Easy access is essential when we're talking about emergency savings, so your money should be stashed somewhere you'll be able to get your hands on it quickly ... in case of, well, an emergency. It should also be in a "safe" investment -- meaning one that won't tank every time the stock market takes a tumble. That narrows it down to:
• High-yield savings accounts.
• Money market accounts.
• Money market mutual funds.

For non-emergency savings (where you pinky-swear to let the money sit untouched until you need it) less liquid investments -- such as certificates of deposit -- may offer you a better interest rate on your money I spoke about this here in "Where To Stash Your Cash!!!"

Click around and comparison-shop

Look at bank ads in newspapers, check out the best national rates on Bankrate.com, see what your broker is paying on cash in your brokerage account, ask your regular bank or local credit union what they offer, and get information on money market funds from websites like www.iMoneyNet.

Find out:
• What interest rates are available.
• What are the comparable yields over identical time periods.
• What timeframe the rate applies to.
• What fees (if any) there are to purchase and maintain the investment.
• The minimum investment required to get favorable interest rates.
(Investors beware: Some institutions will offer aggressive rates in order to lure you to send them your dinero, only to lower the rates soon thereafter. Check historical rates at Bankrate.com to test the interest rates over time.)

Just do it

The clock is ticking. There's no time to waste. A short-term emergency fund is one of Being Broke Sucks top money "must-haves." In fact, it may be the very thing that saves you from a long stretch of high-interest credit card debt after a fender-bender, chipped tooth, basement flood, or really unfortunate haircut

Extra credit: Automate it!

If you're having trouble saving, we highly recommend an automatic transfer program. You can also see if your employer will split your paycheck (direct deposit) between your ordinary account and your short-term savings account, or you could set up an auto-transfer from your checking account into your emergency account