With difficult economic times making people less likely to pay off their debts, this is exactly the kind of situation when companies will be more likely to hire third party debt collectors to hunt down their money. If you have unpaid debts and a debt collection agency gets involved, it’s useful to know what your rights are:

• You are allowed to ask them to verify your debt - that is, to prove that it belongs to you, and until they do so, no other action can be taken
• Debt collectors are only allowed to contact you between eight in the morning and nine at night.
• They are not allowed to ask your employer about any details of your work (including salary or length of service) but they do have the legal right to contact your employer to verify that you work there.
• After a particular period of time has elapsed without being able to contact you (the time varies), then a debt collector is legally permitted to use other methods to try to find you, including internet searches and contacting your neighbors, relatives or friends - however, they are not allowed to disclose anything about your debt to these people.

Nobody really wants to think about getting old and needing long-term care, but it’s important to consider the possibility that you might need expensive care. Do you have the savings to pay for this if it becomes necessary, or should you look at taking out a long-term care insurance policy? There are arguments for both sides which you really have to weigh up for your personal situation. (more…)

If you think having an MBA will help your career, you might be confused about which school to choose. Business Week creates a list every two years of the top schools for MBAs in the United States and some of the highlights from this list are:

• University of Chicago: It’s in the number one spot again with its Booth School of Business, right where it was when they last did the survey.
• Harvard Business School: This is second on the list but it’s the most expensive with tuition fees totalling almost $102,000. The great thing is the average student increases their salary by $44,000 when they graduate with a Harvard MBA.
• Stanford University: The most exclusive on the list, Stanford only accepts 8% of applicants (many others accept around 20 to 30%). Since they have small classes and a good location, the MBA here is clearly in demand.
• University of California Berkeley: It comes in tenth on the list, but is by far the cheapest with tuition fees adding up to “just” $84,000.
• Colombia Business School: Last time they did this survey Colombia just scraped in at number ten, but they’ve made some improvements to rank up at number seven now; although the New York location may not be so important after Wall Street disasters this year.

photo credit: krisdecurtis
With Christmas rapidly approaching, many people might be getting worried about how they’ll let their finances stretch to buying the expected Christmas presents this year. Don’t blow the credit card balance on gifts; instead consider these tips on budget Christmas presents:

• Agreee amongst your family that either you won’t buy gifts for each other this year, or everyone will only buy one gift - draw names out of a hat so that everyone is randomly allocated the person they should buy a gift for. Make sure you agree on a price limit (and not too high, or it defeats the purpose).
• Speaking of price limits, if your family or close friends all still want to buy gifts, think about agreeing on a maximum amount they should spend - this is especially useful if income levels differ widely amongst the group, so those with lower incomes don’t feel they have to spend a lot to “keep up” with the others.
• Consider making home-made gifts - if you have a crafty talent, create personalized gifts, or even just do some baking. There are very few people who don’t appreciate some home-made cookies, especially if you wrap them nicely and make it look personal. Not only is it cheaper than buying ready-made cookies or cakes, it also shows that you put some time and effort into the gift.
• In large families, decide on an age limit for gifts - for example, only children under 16 will receive gifts this year. Many families consider that being together at Christmas time is much more important than receiving gifts, and the real joy of the season is really in watching the younger children enjoy it.

Volatile times make money and investment decisions that bit trickier. Sometimes it’s easy to over-react and suddenly take all your money out of investments to put it in a “safe place” - but that can often leave you worse off than when you started. CNN Money has some tips on what to do with your money to keep it safe during the coming months and years:

• Don’t stop contributing to your retirement account. In fact, it makes good sense to contribute to your retirement account when the share market is down because then you’re paying less for your investment.
• If you have some capital losses, you may want to realize them now to cut your tax bill - consult your financial planner or tax accountant to see if you’ll come out better off.
• Switch from a traditional IRA to a Roth IRA this year - because when you switch you pay taxes on these assets, so if they are lower than normal, it’s a great time to change and pay less tax. There are various reasons that a Roth IRA could be better for you but there are also income limits so check it out with an expert before you make a decision.

While everyone hopes it won’t happen to them, losing your job is certainly more likely during this economic climate than it was a few years back. If you’re one of the unlucky ones, the least you can do for yourself is figure out the way you can get the best severance package:

• Start out by making sure you know the company policy for severance packages. It varies widely between companies and while it’s often calculated according to the years of service, how much you get for each year you’ve worked there can vary from one week to two weeks, or even much more if you’re in an executive level job.
• Don’t be afraid to negotiate. Ask for more than they offer you; you’ve certainly got nothing to lose, because you’re losing your job anyway if it gets to this negotiation stage. Knowing what the policy is (or was - they might change it) and knowing what is standard for the industry can help make a good case for getting more.
• Ask for more than straight severance pay - ask for other conditions too, for example continuing paying your health insurance for you for an extended time.
• Get some advice before you agree to a severance package - or at least ask for a day or two to think about it before signing.

photo credit: Tracy O
In my house right now, we’re considering buying a lawnmower and firing the lawmower guy (shh, don’t tell him!). But the lawnmower purchase is a big one - my other half’s looking at one around the $1000 mark - so it needs some research. This guide from Mint on planning for big purchases is helping us out as we narrow down on what type of lawnmower and how much we should spend. The most useful tips there are:

• Figure out the features that you must have. For example, what kind of blade on the lawnmower, or how big a new car should be.
• Decide on the price range - which really means, decide a maximum price. Ignore any product you see which costs more than that - ignore it without finding out anything more about it than its price.
• Ignore the up-sell when the sales person wants to sell you extra features - like cup holders in the car for $300. It might not seem much if you’re spending $20,000, but it is. Be strong!
• Check smaller stores as well as large discounters, and don’t be afraid to ask for a lower price at a shop you like when you’ve seen the same item advertised at a lower price elsewhere. Ask what extra features they can throw in for free, too.

If you’re working as a freelancer or are paid almost entirely on commissions, you’ll be one of the people who have a variable income and therefore need a slightly different approach to money management. Money Magazine recently put together some tips for those living on a flexible income which could help you out.

• Figure out the lower limit of your income and make a budget to suit. For example, look at your income over the last five years (if you’ve been paid “flexibly” for that long) and take the lowest income level. Make a monthly budget that you could survive on at this income level.
• Have a larger emergency fund than others - while fixed salary workers generally should have three to six months’ expenses as an emergency fund, the risks of earning less for a freelancer is higher and they should have enough cash saved to survive at least twelve months.
• Save for your retirement - this is often neglected by freelancers who don’t have an employer making contributions for them, so get some financial advice on the best way you can do this and make it a priority.
• When you earn money above this minimum rate, use it carefully to achieve other goals you have - for example, paying down debt like credit cards or car loans.

If you’re planning a long trip or even thinking of backpacking around Europe or Australia for a while, it doesn’t have to use up every penny of your savings. Saving some cash on your trip is relatively easily done if you follow a few of these tips:

• Get cheap flights by being totally flexible about timing, flying into cheaper airports (usually further away from the city, but check the transport costs and it might work out a whole heap cheaper), and subscribing by email to airline newsletters which often offer cheap deals if you book quickly.
• Do your research thoroughly on hotel or hostel costs, and try last minute websites to get an extra cheap deal.
• Shop around to get the best value insurance, and check with your credit card company which sometimes offers travel insurance if you buy stuff like your flight with your credit card.
• Don’t buy new equipment if you don’t absolutely need it - if you’re going camping, for example, look on eBay for tents that other travelers no longer need, but might not have used much.
• Use public transport as much as you can, or do thorough research on the price of a hire car.
• Eat from supermarkets if you don’t have the budget to eat out at restaurants every day of your trip. Your waistline will probably thank you too!

Everytime you turn on the news or open the paper, it seems like another bank has folded or been merged into the embrace of another, larger concern. Here are a few that have withstood the financial crises of centuries past. Although at least one may not be around for much longer.

Banca Monte dei Paschi di Siena Siena, Italy

Established in 1472 to grant loans to “poor or miserable or needy persons,” Monte di Pieta, or Monte Pio as it was then known, translates as mountain of piety. The idea for a lending institution that catered to the needy came from the Franciscan Friars who advocated interest-free loans to the needy. That idea had been tried as early as the 14th Century when the Michael Northburgh, the Bishop of London, left 1000 marks of silver to establish a bank that would lend money on pawned objects, without interest, providing that the expenses of the institution be defrayed from its foundation capital. The capital was eventually consumed, and the bank closed. The mercantile families of Siena who started the bank doubtless had this in mind when they established the interest rate at 7.5 percent.

The bank was awarded a new charter after Florence’s Medici family was given the Republic of Siena for its support of Emperor Charles V in a long civil war. In 1624, then, the new institution was founded, which was to be managed by eight citizens belonging to the nobility. The bank expanded into agricultural and business loans that were guaranteed by a lien on income from the public pasture lands in Maremma, called the “Dogana dei Paschi.” (more…)