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Are you Under-saved? Then Stop Saving This Way and Start This Way

by Bob Brooks

July 29, 2014

If you are under-saved, you are not alone.   A new poll just released by and The Penny Hoarder unearths a startling statistic:

73 percent of Americans have under $1,000 saved -- or don't have a savings account at all. Some additional findings:

  • Less than 14 percent of respondents have $10,000 or more saved.
  • Men are better savers than women; 33 percent of men versus 24.6 percent of women have savings of at least $1,000.
  • Generally, the more a person makes, the larger his savings account is.

Surprised? If you think about it, this goes hand and hand with the enormous amounts of credit card debt we see in this country. Everyone will experience at some point in their lives an unexpected expense. Most people are under-saved with an inadequate amount of money put back for emergencies. Thus, that expense goes on the credit card.

So, how do you create an emergency account when you haven’t been saving at all? Stop saving for the long-term if you haven’t prepared for the short-term. By writing that I might have just committed a cardinal sin. What do you mean stop putting money in your 401 K plan? We are always taught to save for retirement.

Think through this for a minute. Why save for the long-term when the short-term is exposed to liability? You could have hundreds of thousands of dollars locked up for the long-term. However, if a short-term emergency occurred without an emergency back-up plan, that long-term money does nothing for you.

Grant it there is nothing exciting about saving money in a savings account that earns .0010%. However, it beats accumulating debt. Emergencies will happen. Taking a year or two off from long-term saving in order to fund an emergency account could make a lot of sense.  

For more information on the, click here.

The Credit/Security Freeze – The Most Effective Way to Protect Your Credit

By Bob Brooks

July 25, 2014


There are several ways to protect yourself from identity theft. However, there is one that is superior to all.

Credit Monitoring

This is an identity theft prevention process. A credit monitoring service will alert you every time something changes on your credit report as well as anytime an inquiry for credit is made. I call it the first line of defense against identity theft. Once you find out that an unauthorized inquiry is being made, you can immediately contact that lender and stop the process. We recommend

Fraud Alert and Extended Fraud Alert

If you suspect or know you are a victim of identity theft, then you can place a 90 day fraud alert on your credit file. With that fraud alert on your credit file, lenders would have to contact you and verify that you are the person attempting to get credit. It works 75% of the time. You can also extend that coverage for 7 years.

Credit/Security Freeze

This is simply the best way to protect yourself. With a security freeze, NO ONE can access your credit file except you. You have to “unfreeze” your reports to open them back up for public access. If you have a credit freeze on your credit files, you have a lock on them. If you are a victim of an identity theft, you can get one for free if you mail in a police report. However, I have found if you suspect you are a victim of identity theft, you need it done immediately. You have to initiate this with the 3 main credit reporting agencies.

Here is what you do:

Equifax – You can do it on-line by clicking here

Transunion – You can do it on-line by clicking here

Experian – You can do it on-line by clicking here.

In most states it costs $10 per credit reporting agency. You can also “unfreeze” your reports at these same links. Once you freeze your accounts, you will get an online letter that gives you a PIN that you will use to “unfreeze” those accounts.

You have to weigh the costs. However, it makes sense to pay the fees to freeze and unfreeze your reports if you are not applying for credit that often.

If you want to completely lock up your credit files where no one can access your information without your approval, then you would initiate a credit freeze.

Obviously nothing is fool-proof and even with a security freeze you have to be diligent in making sure your information is protected.   However, out of all of the options, this seems the best way to go.

Ways to Save Money on Back to School

by Bob Brooks

July 22, 2014

I always am amazed at the amount of money it takes to go back to school.  From clothes to uniforms to school supplies, it can get expensive.  Kiplingers Magazine just published their 10 ways to save on back- to-school shopping and I thought I would share it with you. 

  • Shop your home first—take inventory of your drawers, cabinets and closets so you know what you already have before shopping. You’ll likely find that you already have several items such as notebooks and pencils that you purchased but your kids never used.
  • Email a teacher—if your child’s school doesn’t provide a shopping list, ask your child’s teacher what supplies are absolutely needed when classes start. This will help you avoid wasting money on supplies your child doesn’t need.
  • Set a budget—once you know what you already have, make a list of what you need to buy. If you set a cap before you shop, it will keep you from buying impulsively and overspending.
  • Know when to shop—for the supplies you need that are a specific brand or model, shop as early as possible to avoid the risk of stores running out. For more generic items, prices will drop closer to the start of school. Summer clothing is already deeply discounted and select retailers will have sales on jeans in mid-July to mid-August. August is also one of the best months of the year to find deals on laptops. And 15 states have sales-tax holidays during the month.
  • Know where to shop—it may seem convenient to get all your shopping done in one place, but hitting different sales will save money in the long run. For example, the best deals on folders and notebooks are at office supply stores. You’ll also find good sales at big-box retailers such as Target and Walmart.


To view the full article and see the other 5, visit:

How Bad is it in Detroit? Really Bad

by Bob Brooks

July 21, 2014


The bankrupt city of Detroit is in worse shape than anyone can imagine.  Once the fourth largest city in the country, it is now 18th smaller than Austin Texas.  According to this source, 60% of the children in Detroit live in poverty.

It takes money to run a city of that size and Detroit lies in financial ruin.  When you are bankrupt, you lose critical services such as police, schools, water/trash, etc.   The median cost of a home in Detroit is $9,000.  It is estimated that there are 33,500 vacant homes and 91,000 vacant residential lots.  There is good reason why; the crime is the worst in the country.


The murder rate is 11 times higher than New York City.  There are about 2,500 police officers in the city.  Police Stations are only open 8 hours a day because of budget cutbacks. 


The sad facts about Detroit are a mile long.  Just recently, I received an email from a progressive movement (and no I don’t support the progressive movement) talking about the water situation in Detroit.  Apparently, so many residents have become behind on their water bills that thousands have had their water shut-off.  Water costs have also increased and people can't afford to keep their water services.  Thus, ”thousands of low-income families have no water for drinking, bathing, cooking, or flushing the toilet.” 


United Nations experts have called the water shut-offs to low-income residents a violation of human rights.  You wouldn’t think that something like this could be occurring in America.  Just last week, the bankruptcy Judge insisted that the city do something about this problem.  However, there really is no money to extend services to those who cannot afford it.  How did this occur?  Debt and irresponsible spending.  The more concerning fact is that so many other cities are heading down this same path.  These are the stories that get lost in the media. 


Are these types of situations fixable?  Only if the government were to get involved.  The problem is that helping out bankrupt cities is so far down the list on the agenda of most politicians.   Plus, if you help out one city, you have to help them all out

Can Our Country Get Out of Financial Trouble? 9 Important Steps to Take

by Bob Brooks

July 18, 2014


Dear Bob,

I have been thinking about the direction of our country financially.  It just seems that there is no way out of the debt and irresponsible spending by politicians.  What do you think the future holds?  I would like your opinion.


A:I have had the opportunity to interview many authors who have devoted books to this question.  I have heard many opinions.  I have come to a simple conclusion. 

The economy is fixable. It would be a painful process.  However, it is fixable.  Second, in order to fix the economy politicians would have to put the country ahead of politics and make decisions that would be politically distasteful.  For politicians to put the country ahead of politics, they would have to be less concerned about their own agendas and getting re-elected.  In order for that to happen, they would have to take the politics out of Washington.  What is the likelihood of that happening? 

We have escalating wars in the Ukraine and in the Gaza strip.  These are significant.  What are the elected leaders doing?  They are holding their fundraisers for re-election. 

Our national debt is continuing to increase and not in any way decrease.  Without taking action, it will get to a point of no return.  There is not a care in the world in Washington and the spending continues. 

You have to look at it from the standpoint of the politician.  As long as the politician stays elected, the politician and their families stay shielded from any of the mess that is created.  For example, they don’t even have to participate in Obamacare.  As long as they are elected, they are royalty.  To stay elected, they have to take care of people and play politics.  It is a dangerous cycle.  This is not a democrat or republican thing. It is a political thing.

So at our expense, we are safeguarding the lifestyle and power ranking of every politician in Washington.  I am sure that is an unfair statement to say they all are that way.  It is safe to say that a high enough percentage of them are that way and enough to eventually bankrupt the system.

Given the high probability that within some point we will see the consequences of debt and irresponsible spending, what should your response be?

  1. ELIMINATE debt and get your own spending under control
  2. PRIORITIZE your financial planning for the future (most leave it to chance)
  3. DEVELOP a plan B for your investments because Plan A might be a tough one to follow
  4. PRACTICE Biblical teachings when it comes to money
  5. TEACH your children Biblical teachings when it comes to money
  6. PREPARE your children for an uncertain future
  7. FOCUS on your relationship with God and His Will for your life– after all, 17 trillion of debt doesn’t change that important discipline
  8. TRUST and have confidence on the promises of God and that God will walk you through anything
  9. REFUSE to worry about something you can’t control – you can only control steps 1 through 8
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