Plan Now to Save Your Refund!

"Mental Accounting" is a very cool economic concept, created by Richard Thaler, which basically says that we tend to put our current, and future, money into certain "buckets" or accounts. Once we put money in these mental accounts, we tend not to take them out. For example, we know what paycheck our mortgage or rent comes out of and we don't take from that money. Similarly, and sometimes to our detriment, we put money into grocery or clothing categories. Even if the electric bill went up this month, we have a hard time reallocating money from the grocery or clothing accounts to cover the higher electric bill.

Many of us start planning in November for whatever holiday we celebrate and thinking of the gifts we would like to buy friends and family. If we haven't been saving for these expenses throughout the year, we buy them anyway knowing that there's a tax refund coming early next year. We have already put that refund into a mental account to pay for holiday bills.

I'd like to propose a different idea. Start now in November and put at least half of that expected refund into a mental account for savings. It's the one time in a year where a chunk of money comes our way and having some put away for an emergency will result in a lot less stress when that emergency, invariably, comes our way. Take a look at your holiday expenses and find creative ways to reduce them so you don't wake up in January with a "hangover" of bills and regret.

Using the "Mental Accounting" concept can help us change our financial decisions to help us reach our financial goals and stress less over money.

"Free" Credit Scores Aren't Always Free

Hopefully you know that you can get a free credit report from each of the three large credit reporting agencies for free under federal law. If you live in Maryland, you can also get a free credit report from each bureau under Maryland law. But you may not know that credit scores are not free under federal law. However, you've probably seen the ads that offer to give  you your credit score for free. Be careful, most of the sites that offer this are credit monitoring services which charge you a monthly fee for various services around protecting your credit. Watch this video from the Federal Trade Commission on free credit reports that are not free. Other sites give you a credit score from one bureau, not a combined score, and are riddled with advertisements and "personal offers" for credit cards or loans from their paid sponsors. Always find out how such a website or company is funded and what they do with your personal information that you enter to get your "free" score. One option to consider is using the FICO Score Estimator and Calculator. You do not enter in any personal data like your social security number. You answer questions about your use of credit and it estimates a score for you. It's pretty close to what you would get from private sites and you aren't allowing anyone to use/sell/trade your personal information.

Hurricane Season Doesn't Have to Wipe You Out

Hurricane Season for those of us on the east coast and around the gulf states in the United States runs from June 1st to November 30th. We've already seen one so far this year and while we were fortunate that it didn't cause widespread damage, it does serve as an alert to us to be prepared in the event of a major hurricane. Some items on the check list are:

• Have food on hand that you can eat without much preparation and extra water for drinking/washing hands. 
• Fill up bath tubs for water to flush toilets.
• Ensure you have safe ways of having light such as battery lanterns or flashlights, not candles. 
• Trim your trees so that branches will be less of a hazard during a storm. 
• Consider buying a crank emergency radio that also charges cell phones.
• If you have a generator, make sure you have gas on hand before the storm, properly stored and that the wiring for the generator has been installed/inspected by a licensed electrician.  
• If you have a pet, have extra food and water for them. Make a plan for how they will go to the bathroom during the storm when they can not go outside. 
• Once a storm is heading your way, be sure to move outside items that could be blown into your windows, house, car etc by the heavy winds. 
• Identify a room with fewer windows to hang out in during the storm in case of debris breaking through a window. 
• Turn off any propane tanks.
• Know food safety tips for eating food from a refrigerator which has experienced lack of power.

Being prepared for a hurricane will help you minimize the damage and effect of the storm on you and your family. Check out more tips on the Federal Gov't website, www.ready.gov

MCRC announces Tips on Avoiding Ticket Scams

Have you ever purchased tickets to a concert or sporting event and then had a change in plans which lead to you trying to exchange the tickets or trying to transfer the tickets to a friend? Ever felt that the actual price of a ticket wasn't disclosed, due to all the add on fees? Going to a concerts or sporting events is supposed to be fun but the experience can be tainted by the ticketing buying/selling process.

Maryland Consumer Rights Coalition, (MCRC), a non-profit organization that advances and protects fairness and justice for Maryland consumers through research, education, and advocacy has issued a helpful "Summer Concert Ticket Guide" featuring six key tips on how to avoid ticket scams. Check it out and enjoy those concerts/events by being a smart consumer!

Summer Safety Tips

Memorial Day is the unofficial start of summer for the U.S., a.k.a our excuse to lengthen the summer season. Summer brings longer sunlight days, warmer weather, outdoor activities and vacations. We want to enjoy these benefits of summer but also need to think about some safety tips to make sure the memories of summer are fond, not tragic.

• Never leave a young child in a car unattended.  Also, remember to lock your car doors when your car is in your driveway. Safe Kids Worldwide put out an alert last week of the 5th heatstroke death of 2014. The boy tragically passed away May 3rd, four days after being found in his car seat in the family car outside his home in Bakersfield, CA.  The boy, who suffered from autism, wandered away from his grandparents’ supervision and climbed into the car. This is now the second time this year that a child has gained entry to a vehicle on its own and then died. Watch this simulation from Safe Kids Worldwide about how quickly the temperature in a car can increase.  
• Never leave your pet in a car on hot days.
• Always wear certified helmets when doing activities that involve moving faster than you can run: biking, roller skating; skateboarding or horseback riding are a few.
• Watch children around the pool, young ones are certainly at risk for drowning if they can't swim and older ones are at risk for serious injury while attempting to impress their friends with jumping on a moving raft or other unsafe activities.
• If your child is going to camp this summer, ask the staff what their safety policies are and inspect the camp yourself for any hazards.
• Be aware of how much time you spend out in the yard working and ensure you don't get dehydrated or sunburnt. If your pets are outside with you, put out a bowl of water in the shade and make sure they have a place in the shade to rest.
• If you are entertaining this summer, keep the food on ice or refrigerated as long as possible before serving and follow the general guideline of not having food sit out for more than 3 hours.
• Keep an eye on the weather at home and on vacation so you aren't ambushed by a dangerous summer storm.

For more safety tips, see Safe Kids website. If you are involved in Montgomery County, MD and would like to either find a local event where safety topics will be displayed, have your car seat checked or join the local chapter of Safe Kids, click here.