You are the 47 Percent

By Joel Mathis in the Los Angeles Daily News, September 23, 2012

Are you married? Have a job? How about a kid or two? Did you get a tax refund last year because your status as a working parent made you eligible for an Earned Income Tax Credit?

Congratulations: Mitt Romney thinks you’re a welfare-addicted bum.

See, when Romney talks about that 47 percent of Americans who don’t pay income taxes, he’s talking about you.

You may not think that’s true, because of course you pay plenty of taxes – there’s the payroll tax that comes out of your check every week, the fee that goes to pay for Social Security. And of course, the world is a maze of taxes for you: Every time you fill up the gas tank or buy a birthday gift for the kid, the price is a little higher because of the extra few cents that goes to the state or local governments.

Surely Romney’s talking about somebody else?

Somebody who sits at home and waits for a government check they didn’t earn?

Nope. He’s talking about you.

See, to get to that 47 percent number, Romney has to include folks who actually work but didn’t officially pay income taxes because they didn’t earn enough, or because they qualified for the Earned Income Tax Credit.

Nearly two-thirds of Romney’s laggardly 47 percent paid payroll taxes.

And to state the obvious: You generally have to be on a payroll to pay the payroll taxes. You have to have a job.

Now: Romney obviously wasn’t taking you into account when he said that 47 percent is “dependent on government” and “entitled to health care, to food, to housing, to you-name-it.”

Which is the problem: Romney wasn’t taking you into account. He and the rest of the Republican Party have been so solicitous of so-called ‘job creators” that they’ve treated job doers rather shabbily. It’s something to think about when you vote in November.

Reduce the Risk of Becoming a Victim of Financial Elder Abuse

Advise sent to me from a law office.

Five Tips to Help you Reduce the Risk of Becoming a Victim of Financial Elder Abuse

1. Choose a Caregiver with Caution

Do not assume that by hiring a caregiver through a bonded agency you are guaranteed to get someone who has been checked. There is no current law requiring mandatory background checks for in-home caregivers in California

2. Keep an Inventory of All Jewelry

Jewelry is the number one item that is stolen from homes occupied by elders. Not only should your jewelry be kept in a locked drawer, you should have photographs of rare, valuable, or sentimental items in a separate location. In the event of theft, such photographic evidence will be useful in tracking down the missing jewelry at a pawn shop.

3. Every Home Should Have a Shredder

Every piece of mail containing your name, address and any other identifying information should be shredded before being discarded. The most effective type of shredder is the crisscross cut shredder. Even envelopes with your name and address should be shredded. Never throw away old checkbooks from closed accounts or bank credit card application forms. There is no danger in over shredding.

4. Protect Your Incoming and Outgoing Mail

Never allow incoming mail to sit in an unsecured mailbox where the public has access. Mailbox theft is rampant. Similarly, never leave outgoing mail in an unsecured mailbox with the red flag raised as this simply provides as easy alert to the thief who is “cruising” the streets. Consider either purchasing a locked mailbox or renting a post office box from your local post office.

5. Obtain a Credit Search on Yourself at Least Two or Three Times a Year

Identity theft is rampant. The only way to have peace of mind is to obtain a credit search on yourself periodically from one of the three major credit bureaus – Experian, Equifax and TransUnion. This will enable you to discover whether someone has applied for, or obtained, a credit card in your name.

When You Retire Will the Money be There?

No one cares more about your savings and investments more than you. You need to become an expert on the kinds of investments that you are comfortable with holding. Don’t let a financial adviser take control of your funds. No matter what he/she says, they do not understand your true wishes and needs. They will not be the one in pain if those savings are lost.

The unpleasant reality is that most of us do not save enough money for our retirement years. The reason is obvious. The cost of living takes our paychecks. It’s not a new situation. This has been a fact for all of history. It is the reason that Social Security was created in the 1930s. That insurance provides sufficient income in retirement years to prevent starvation. It is only enough to pay for food, housing, and other basic necessities.

The problem is that Social Security has become the only income resource for many retired Americans. (401(k) plans have not become the outstanding resource that many believed would occur. The reason is they are not a mandatory savings plan. It is a voluntary program. The average balance in all 50 million (401(k) accounts is just over $60,000 according to the Employee Benefit Institute. Even people within 10 years of retirement have saved an average of only $78,000, and more than a third have less than $25,000.

I still hear financial gurus saying that you should be receiving 10% or more on your savings. I know such investments do exist but they are not well known. Those that do pay that level of return are high risk securities that most people are not prepared to take. Even Vanguard’s High Yield Corporate Bond Fund pays 6.75%.

Even if you savings are small there are magazines you can view in the library and sites that do not charge anything. My favorite is Morningstar. You do not have to subscribe to obtain much of their information.

Start today thinking about where your income will come from when that day comes when you want to say “It’s time for me to retire.”