scams http://www.wisebread.com/taxonomy/term/300/all en-US 9 Expensive Mistakes of the Newly Retired http://www.wisebread.com/9-expensive-mistakes-of-the-newly-retired <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-expensive-mistakes-of-the-newly-retired" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-172208749.jpg" alt="Finding expensive mistakes of the newly retired" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Transitioning to retired life on a fixed income will undoubtedly have a few bumps in the road. This is a brand-new chapter of life for you, and it's reasonable to expect some challenges ahead. The last thing you want to do, however, is compromise your nest egg with costly, easily avoidable mistakes. After all, you need that money to get you through the rest of your life.</p> <p>As such, consider these costly mistakes of the newly retired so you don't follow suit.</p> <h2>1. Not balancing your portfolio</h2> <p>Retiring doesn't mean you have to stop investing. You can still dabble in the stock market, but perhaps not as aggressively as you once did. Risky bets could cost you your life savings, which means that you'll either have to go back to work past age 65, or put your hat out on a street corner. Neither of those options sound great in the golden years of life, so it's important to ensure your retirement portfolio is balanced.</p> <p>&quot;Annuitizing a significant portion of one's retirement income can complement a portfolio of stocks and bonds,&quot; says Jim Poolman, executive director of the Indexed Annuity Leadership Council. &quot;Fixed indexed annuities (FIAs) can serve as part of a balanced financial plan because they do not directly participate in any stock or equity investments and [they] protect your principal from fluctuations in the market.&quot;</p> <h2>2. Not changing your lifestyle after retirement</h2> <p>Your spending habits as a retiree will need to change if you're going to make it for the long haul. This is especially true if you're not receiving any kind of monthly payments, like Social Security or disability, to help with bills. You can live off what you have in the bank (hopefully; otherwise you shouldn't be retiring yet), but you may have to downsize and rethink your spending strategy.</p> <p>This means you need to start learning how to save money on everyday expenses, and re-evaluate your budget to find places for cuts. Don't expect yourself to suddenly drop 30 percent or more of your spending. Work your way to it by making small cuts at a time before you retire.</p> <h2>3. Not evaluating risk</h2> <p>When you start saving for retirement, you may have a certain monetary goal in mind &mdash; either based on what financial sources have told you, or what you've calculated you'll need based on your lifestyle. But you may not be accounting for the ups and downs of Wall Street and inevitable inflation.</p> <p>&quot;Revisit your retirement plan to make sure your savings reflect your new needs, and adjust for market conditions,&quot; Poolman advises.</p> <h2>4. Spending too much money too soon</h2> <p>When you retire, what you have is what you have. Unless you still have income coming in somehow, you have to mind your money and avoid the temptation to spend it on splurges, especially if you find yourself bored in the first year of your forever vacation.</p> <p>&quot;Before finalizing your retirement, you must take into consideration that you will only be living on a fixed amount of money,&quot; Andrew Fiebert, co-founder of Listen Money Matters, says. &quot;Oftentimes the amount of retirement savings looks pretty large, but retirees must keep in mind that money will have to last a very long time &mdash; hopefully a very, very long time.&quot;</p> <p>The enticement to spend your money can be almost irresistible, but discipline is vital. Depleting your money beyond the interest that it earns will hurt the principal and leave you with nothing after just a few years.</p> <h2>5. Loaning money to adult children</h2> <p>I get it &mdash; you love your kids. But at what cost?</p> <p>According to a 2015 Pew Research Center poll, a whopping 61 percent of parents in the U.S. admitted to <a href="http://www.pewsocialtrends.org/2015/05/21/5-helping-adult-children/" target="_blank">helping their adult children financially</a>. That may be well and good if you have that kind of disposable income lying around (though it only fortifies your children's reliance on you; learn to say NO!). However, if you already need to cut back because you didn't save enough to live an easy, breezy retirement &mdash; which applies to most Americans &mdash; providing handouts, the payback of which you may never see, could put you in a financial pickle.</p> <p>Don't be afraid to cut your grown children off. If you don't have the extra money, neither do they.</p> <h2>6. Taking Social Security benefits too early</h2> <p>The overriding argument against claiming Social Security benefits too early is that you won't receive your full benefit potential. That could come back to bite you later in life.</p> <p>If you decide to claim Social Security benefits before you reach your full retirement age, you'll receive a smaller monthly payout &mdash; up to 30 percent less. If you absolutely need that money before your benefits fully mature, then by all means do what you have to do to survive. You'll be better off, however, the longer you wait.</p> <h2>7. Not taking required minimum distributions after age 70-&frac12;</h2> <p>Starting at age 70-&frac12;, you must take required minimum distributions (RMDs) from your traditional, SEP, or SIMPLE IRA each year to satisfy rules set forth by the IRS. If you don't, you'll pay penalties.</p> <p>You can calculate your required RMD by dividing your IRA account balance as of Dec. 31 of the prior year by the applicable distribution or life expectancy. Qualified charitable distributions can satisfy your RMD, by the way, which you would report on Form 1099-R on the calendar year in which the distribution is made. Do good and save yourself the penalties while you're at it.</p> <h2>8. Falling victim to money scams</h2> <p>Scammers love retirees and the elderly. Why? Because they've usually got money to burn, and they're much easier to fool than the average working-age person. Sad, but true.</p> <p>There are plenty of scams out there, too, and they're getting more intricate all the time &mdash; like one where the scammer poses as the victim's grandchild and begs the grandparent to send money. To prevent yourself from being scammed, remember these two major rules: Never provide personal information over the phone or via email, and never wire any money unless you've spoken directly to your family member or friend who is requesting the transfer. (See also: <a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam?ref=seealso" target="_blank">What to Do When You Suspect a Scam</a>)</p> <h2>9. Failing to account for the unexpected</h2> <p>The reality of retirement is that while you'll certainly have more time to kick back and relax, life isn't necessarily going to get easier &mdash; and you have to prepare for that. Everyone will die eventually, and it's smart to plan ahead not only for end-of-life accommodations, but also long-term medical care.</p> <p>You may live a long and healthy life, but eventually you'll need someone to care for you &mdash; whether that's in a family member's home or a professional facility &mdash; and that will cost money. Hedge your bets by looking ahead and putting those funds aside now. (See also: <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it?ref=seealso" target="_blank">Is Long Term Care Insurance Worth It?</a>)</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/9-expensive-mistakes-of-the-newly-retired">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-things-financial-advisers-wish-you-knew-about-retirement">7 Things Financial Advisers Wish You Knew About Retirement</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-financial-moves-now-that-youll-regret-when-you-retire">5 Financial Moves Now That You&#039;ll Regret When You Retire</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-much-can-you-afford-to-spend-in-retirement">How Much Can You Afford to Spend in Retirement?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-reasons-why-your-retirement-cost-calculations-may-be-wrong">8 Reasons Why Your Retirement Cost Calculations May Be Wrong</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/social-security-is-not-a-ponzi-scheme">Social Security Is Not a Ponzi Scheme</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement expenses investing loaning money long term care Mistakes newly retired required minimum distributions scams social security Wed, 10 May 2017 09:00:07 +0000 Mikey Rox 1940416 at http://www.wisebread.com 8 Real Life Calamities That Can Drain Your Finances (Plus How to Defend Against Them) http://www.wisebread.com/8-real-life-calamities-that-can-drain-your-finances-plus-how-to-defend-against-them <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-real-life-calamities-that-can-drain-your-finances-plus-how-to-defend-against-them" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-515237628.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We all work hard for our money, but if we're not careful, it can be ripped right out from under us. From getting scammed on the internet, to medical emergencies, here are eight situations that can make you broke in an instant &mdash; plus a few ways to protect yourself.</p> <h2>1. Getting scammed</h2> <p>Maybe you're smarter than the average scammer, but loads of people are too trusting and naive. In fact, someone claiming to be from eBay scammed my own mom out of a few hundred dollars via email once. She thought the email was legit because at the time she was selling items on the auction site, and she assumed the request for her banking information was not only sanctioned, but part of the company's protocol.</p> <p>&quot;Scammers target seniors because they're considered wealthy, trusting, and typically unwilling to report scams,&quot; says Roger Cowen, owner of Cowen Tax Advisory Group in Hartford, Connecticut. &quot;Common scams include callers pretending to represent Medicare or the IRS to get your personal information, and fake charity workers asking for donations.&quot;</p> <h3>How to protect yourself</h3> <p>The best way to stave off online and phone scammers is to verify that you're dealing with a reputable organization before providing any financial information. Many institutions never send emails requesting such information, and it's a policy you should adopt for yourself &mdash; never provide bank account, Social Security, or credit card numbers over email.</p> <p>If you've received a phone call asking you to verify any financial information, double check the source before handing it over to the person on the line. Jot down their name and tell them you'll call the company back at the verified number you have in your records. Beware of fake websites as well (these links are usually embedded in scam emails) by checking the domain name to make sure it's correctly spelled. Look for <strong>https:// </strong>to precede any domain that has your financial information. The &quot;s&quot; means the site is security-fortified and usually legitimate. (See also: <a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam" target="_blank">What to Do When You Suspect a Scam</a>)</p> <h2>2. Tax penalties</h2> <p>Getting a bill for back taxes can be devastating. You'll not only owe whatever taxes you avoided in the past &mdash; which may be substantial if you've filed inaccurate returns for years &mdash; you may owe interest and penalties as well.</p> <p>This can happen not only to filers who outright lie in an effort to buck the system, but also to well-intentioned filers who make errors on their returns.</p> <p>In either case, you'll be required to pay up in a short period of time &mdash; or go to jail. Being broke or behind bars could be your only options.</p> <h3>How to protect yourself</h3> <p>If your taxes are complicated, hire a reputable accountant, report your income and deductions accurately, accept your tax liability, and pay it. If it's a large sum, you may qualify for a payment plan. Moving forward, ask your accountant for estimated tax vouchers so you can pay ahead of time to lessen the burden when you receive the actual numbers in April. Otherwise, if you know you're looking at a sizable tax bill, save as much as you can so you can settle up with the IRS as soon as possible. (See also: <a href="http://www.wisebread.com/the-easiest-way-to-avoid-a-tax-audit?ref=seealso" target="_blank">The Easiest Way to Avoid a Tax Audit</a>)</p> <h2>3. Divorce</h2> <p>Sometimes divorce is amicable, but for many people it isn't &mdash; and that usually means somebody has to pay up. This is primarily the case when one spouse earns more than the other, or if one partner is unemployed.</p> <h3>How to protect yourself</h3> <p>If you're getting married and one of you has a noticeably higher net worth, get a prenup. Do not walk down that aisle without it. It's not the most romantic piece of paper you'll ever sign, but you'd be a fool not to. Don't let your future spouse guilt you out of the idea, either. Love is grand, but sometimes it'll take you for everything you're worth. (See also: <a href="http://www.wisebread.com/5-money-moves-to-make-the-moment-you-decide-to-get-divorced?ref=seealso" target="_blank">5 Money Moves to Make the Moment You Decide to Get Divorced</a>)</p> <h2>4. Death</h2> <p>No, not your death. If you're not adequately prepared for the death of a partner, child, or parent, you could end up in a sticky financial situation. There may be medical expenses leading up to the death, and afterward you'll need to cover funeral expenses and settle debts on behalf of the estate.</p> <h3>How to protect yourself</h3> <p>Life insurance is the best way to protect yourself in the event that your spouse, parent, or child dies. If you're the beneficiary, you'll receive your policy payout, which creditors typically cannot come after, to cover expenses and any debts for which you may also be on the hook, like a mortgage. Use this money to satisfy loans that the deceased may have had, especially if you've co-signed for them. If it's your spouse that has passed away, you may be losing half your household income &mdash; maybe even more than that &mdash; so it's important to use the policy money wisely. (See also: <a href="http://www.wisebread.com/5-reasons-why-life-insurance-isnt-just-for-old-people?ref=seealso" target="_blank">5 Reasons Why Life Insurance Is for Everyone</a>)</p> <h2>5. Market crash</h2> <p>Many people have improved their lot in life by taking financial risks. But if you're an investor at any level, you worry about going bust. Any number of things can happen that will affect your bottom line, depending on how deep your investments go. The stock market can crash, taking your life savings with it. The real estate bubble can burst, leaving you on the hook for houses you can't sell. The worst part is there are often no warning signs. One day you're swimming in cash like Scrooge McDuck, and the next day you're looking under couch cushions for loose change.</p> <h3>How to protect yourself</h3> <p>Don't put all your eggs in one basket, don't overextend your credit, don't take on more expense than you can afford, and, above all, don't get cocky with your money. Devise a plan to weather a financial crisis so you'll be prepared well ahead of time. (See also: <a href="http://www.wisebread.com/8-ways-to-prepare-for-a-stock-market-dive?ref=seealso" target="_blank">Ways to Prepare for a Stock Market Dive</a>)</p> <h2>6. Natural disaster</h2> <p>While we can sort of predict the weather, we can't predict the outcome. Any number of things can happen to you, your home, or your personal property during a bad storm or natural disaster that may leave you strapped for cash or even facing a total rebuild.</p> <h3>How to protect yourself</h3> <p>If you live in an area where certain calamities are possible, purchase the proper insurance. Your homeowners insurance may cover certain events, but you may require special policies for others, like floods, earthquakes, and hurricanes. Consider what you're at risk for and put a policy in place. (See also: <a href="http://www.wisebread.com/9-surprising-things-your-homeowners-insurance-doesnt-cover?ref=seealso" target="_blank">9 Surprising Things Your Homeowners Insurance Doesn't Cover</a>)</p> <h2>7. Spending more than you make</h2> <p>Sometimes, your biggest financial enemy is yourself. We like our things in America, and many of us will go to great lengths to get those things &mdash; including spending more money than we have. According to NerdWallet, the average household has $134,643 in debt. Households that carry credit card debt pay about $1,300 a year in interest alone on balances that average $16,748. These statistics represent an 11 percent debt increase over the past decade. (See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=seealso" target="_blank">The Fastest Way to Pay Off $10,000 in Credit Card Debt</a>)</p> <h3>How to protect yourself</h3> <p>Find ways to make more money or live on less (or both). There are many ways you can introduce a second source of income to your household, like <a href="http://www.wisebread.com/the-11-best-websites-for-renting-your-extra-space" target="_blank">renting out your extra space</a>, <a href="http://www.wisebread.com/how-to-earn-extra-money-driving-for-uber-or-lyft" target="_blank">driving for ride-sharing operations</a>, or pet sitting. But if you don't want to work constantly, consider cutting back on your overall expenses. You don't need everything you see, and the faster you recognize that the better off your bank account will be. Plus, you might even be happier as a result.</p> <h2>8. Medical emergency</h2> <p>American health care is in flux right now, which means that you have to be extra vigilant in making sure you're covered. Just one trip to the hospital can set you back financially for years if you're not prepared, perhaps even more if you require long-term care.</p> <h3>How to protect yourself</h3> <p>Cover yourself. You may have to bite the bullet on the premium, but at least you're insured. You can go to the doctor or hospital when you need to, and your care will (hopefully) be covered to an affordable extent. Not having insurance, on the other hand, may very well be a death sentence &mdash; or at least you'll wish it were when you get the bill in full.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/8-real-life-calamities-that-can-drain-your-finances-plus-how-to-defend-against-them">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam">What to Do When You Suspect a Scam</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-you-disrespect-your-money">10 Ways You Disrespect Your Money</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fair-way-to-split-up-your-familys-estate">The Fair Way to Split Up Your Family&#039;s Estate</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-credit-repair-scam">How to Spot a Credit Repair Scam</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-financial-wake-up-calls-and-how-to-deal-with-them">8 Financial Wake Up Calls — And How to Deal With Them</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance audits death disasters divorce emergencies fraud going broke life insurance market crash medical bills overspending scams Tue, 25 Apr 2017 20:00:09 +0000 Mikey Rox 1931272 at http://www.wisebread.com How to Protect Yourself From Predatory Lending http://www.wisebread.com/how-to-protect-yourself-from-predatory-lending <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-protect-yourself-from-predatory-lending" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-479413254_0.jpg" alt="Man learning how to recognize predatory lending" title="" class="imagecache imagecache-250w" width="250" height="142" /></a> </div> </div> </div> <p>Predatory lending has long been a problem for consumers. There is no exact definition of a predatory lender, but in general, these lenders either try to overcharge consumers for loans, or talk them into riskier loans that come with higher interest rates. Predatory lenders have one goal: They want to make as much money as possible on their loans, regardless of whether the loan product actually makes financial sense for the consumers.</p> <p>How, exactly, do people fall for this? It's actually not surprising when you understand the degree of manipulation predatory lenders will use. By targeting mainly elderly, low-income, or simply uninformed victims, these financial predators bank on convincing folks with poor or no credit that they have no other options for obtaining financing.</p> <p>If you don't fit the above criteria, don't think you're completely off their radar, either. Should you ever lose your job, need cash for an emergency, or suddenly find yourself facing steep medical bills, you just might be the next target of a predatory lender.</p> <p>Worried that a predatory lender might have targeted you? Here are the warning signs.</p> <h2>The Lender Wants You to Sign Now</h2> <p>Honest lenders will never pressure you to sign loan documents before you are comfortable. Legitimate lenders give you time to study the paperwork and research the fees and rates associated with the loan.</p> <p>Predatory lenders want you to sign paperwork as quickly as possible. That way, they can stick you with their high-cost loans before you have the chance to research lower-cost alternatives. Never do business with a lender who pressures you to act quickly. The odds are high that such a lender is a predator.</p> <h2>The Interest Rate Suddenly Rises</h2> <p>Predatory lenders like to entice new customers by advertising below-market interest rates on their websites or print ads. But when you actually call these lenders, you're told that you don't qualify for these low rates. Once these lenders have you on the phone, they'll try to convince you to sign up for a loan with a far higher rate.</p> <p>Don't fall for this trick. Companies that advertise interest rates that are far lower than their competitors are usually not trustworthy. The odds are high that these are predatory lenders trying to trick gullible borrowers.</p> <h2>They Tell You Not to Worry About Your Credit Score</h2> <p>Legitimate lenders rely heavily on your FICO credit score to determine if you should qualify for a loan and at what interest rate. This score tells lenders how well you've paid your bills in the past.</p> <p>Beware of lenders who say that your credit score doesn't matter or that they can approve you for a loan no matter how low your score is. Lenders who make these promises will charge you sky-high interest rates because they know that you're desperate for a loan. You're much better off working to <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score?ref=internal" target="_blank">improve your credit score</a> than taking out a costly high-interest-rate loan. Pay all your bills on time and pay down as much of your credit card debt as possible. Slowly, but steadily, your credit score will start to rise, and you can avoid the high rates of predatory lenders. (See also: <a href="http://www.wisebread.com/5-ways-to-pay-off-high-interest-credit-card-debt?ref=seealso" target="_blank">5 Ways to Pay Off High Interest Credit Card Debt</a>)</p> <h2>The Lender Asks You to Lie</h2> <p>Making false claims about your income or debt on a loan application is a crime, and you could face significant fines if you do. Predatory lenders, though, might encourage you to inflate your income or provide other false information.</p> <p>Ignore this temptation. No legitimate lender will ask you to lie on an application. Instead, lenders will take extra steps to make sure that the information you do provide on an application is true. For instance, they'll ask you to provide copies of your most recent paycheck stubs, bank account statements, and tax returns to verify your income.</p> <h2>Your Lender Tries to Talk You Into a Riskier Loan</h2> <p>Be careful if your lender continues to push a loan that sounds risky. Maybe you want to apply for a fixed-rate loan with a term of 15 or 30 years. If your lender pressures you to instead apply for an interest-only loan with a balloon payment &mdash; or something equally as complicated or risky &mdash; walk away. Legitimate lenders will never try to talk you into a loan that you don't want.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/how-to-protect-yourself-from-predatory-lending">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-the-age-of-your-credit-history-matters">Why the Age of Your Credit History Matters</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-surprising-ways-revolving-debt-helps-you">5 Surprising Ways Revolving Debt Helps You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-you-shouldnt-panic-if-your-credit-score-drops">Why You Shouldn&#039;t Panic If Your Credit Score Drops</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-to-keep-your-private-info-private">10 Ways to Keep Your Private Info Private</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-overdraft-protection-racket-why-banks-want-you-to-overdraw-and-how-you-can-get-your-money-back">The Overdraft Protection Racket: Why Banks Want You To Overdraw, And How You Can Get Your Money Back.</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Consumer Affairs credit score interest rates lies loans manipulation predatory lending risk scams warning signs Tue, 07 Mar 2017 10:31:34 +0000 Dan Rafter 1901334 at http://www.wisebread.com How to Tell if That Home Business Opportunity Is Really a Pyramid Scheme http://www.wisebread.com/how-to-tell-if-that-home-business-opportunity-is-really-a-pyramid-scheme <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-tell-if-that-home-business-opportunity-is-really-a-pyramid-scheme" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/women_chatting_tablet_506624473.jpg" alt="Women learning if a home business is a pyramid scheme" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Work from home! Get out of debt! Make a full-time income selling products you love! Such are the promises of companies and their agents looking to recruit people to be distributors or &quot;consultants&quot; for them.</p> <p>These types of &quot;job opportunities&quot; are called multilevel marketing (MLM), and most people who sign up never realize the benefits. If you're considering becoming a distributor for an MLM company, beware of the many warning signs that you could end up making little to no money, or worse, adding to your debt. (See also: <a href="http://www.wisebread.com/multi-level-marketing-the-future-or-folly?ref=seealso" target="_blank">Multi-Level Marketing: The Future or Folly?</a>)</p> <p>Tupperware, Avon, and Mary Kay are some of the best known MLM firms, though they sometimes shun that term in an attempt to distance themselves from controversy-laden companies such as Herbalife and Amway. Both of those companies have been accused of making inflated earnings claims and of being pyramid schemes. The main difference between MLM companies and true pyramid schemes is that the primary purpose of a pyramid scheme is recruiting other distributors, rather than making direct sales. Pyramid schemes are illegal. (See also: <a href="http://www.wisebread.com/8-terrible-work-from-home-jobs-you-should-avoid?ref=seealso" target="_blank">8 Terrible Work-From-Home &quot;Jobs&quot; You Should Avoid</a>)</p> <h2>What Are MLM Companies?</h2> <p>MLM companies, also called network marketing or direct selling companies, incorporate a business model in which representatives make money in two ways. The first is direct sales to consumers &mdash; often friends and acquaintances &mdash; through parties, social networks, and other web sales. The second income source is commissions from sales made by team members you recruit, also known as &quot;down line&quot; distributors.</p> <p>IBISWorld estimates the direct selling industry makes $41 billion in revenue and employs about 800,000 people. Intense competition from mass merchandisers has kept growth to a modest 0.6%.</p> <h2>MLM Promises Are Tempting</h2> <p>The sales pitches of MLM companies can be alluring, especially for stay-at-home moms, students, and the unemployed. Just imagine, they exclaim, a work day that includes jumping on social media, talking up strangers at the grocery store, or networking with friends. By selling products you love and believe in, you could earn extra money while enriching others' lives. And if you could convince a few friends to become distributors beneath you, you could have your own business &mdash; becoming the &quot;boss&quot; for the first time in your life. The promise is this: If you pour your heart into your business, get people to sign up beneath you, and never give up, you can (and will) become successful &mdash; no matter what.</p> <p>And when it comes to recruiting new distributors, some MLM companies pull out the big guns. It Works! &mdash; a company that sells body wraps, supplements, and personal care products &mdash; advertises huge cash payouts for new distributors who meet specific sales goals. How huge? The company frequently advertises bonuses of $15,000 or more for their top tier sellers, although it's hard to find concrete data on how many sales you need to make to earn these bonuses, or how they are paid out. (See also: <a href="http://www.wisebread.com/17-part-time-jobs-to-do-while-your-kids-are-at-school?ref=seealso" target="_blank">17 Part-Time Jobs to Do While Your Kids Are at School</a>)</p> <h2>The Problem With Multi-Level Marketing Operations</h2> <p>While people can and do earn huge sums of money with MLM companies, there are myriad pitfalls to avoid. First, it can take a ton of sales to get anywhere near the mind-blowing income levels posted on corporate websites. And to reach the highest ranks of earners with any MLM, you may need to recruit dozens of people to work beneath you (with them recruiting people to work beneath them as well).</p> <p>Secondly, as we mentioned before, the line between MLM firms and pyramid schemes is fuzzy. In a pyramid scheme, the price of the products sold is inflated, making them hard to sell and causing the vast majority of participants to lose money. The <a href="https://www.consumer.ftc.gov/articles/0065-multilevel-marketing" target="_blank">Federal Trade Commission (FTC)</a> warns of the similarities, noting:</p> <blockquote><p>Not all multilevel marketing plans are legitimate. If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is based on the number of people you recruit and your sales to them, it's probably not. It could be a pyramid scheme. Pyramid schemes are illegal, and the vast majority of participants lose money.</p> </blockquote> <p>Even if the company is legitimate, most MLM companies require a &quot;buy in.&quot; You'll need to pay a certain amount of cash upfront to sell their products. While these &quot;starter kits&quot; normally cost a nominal amount (a few hundred dollars), they will certainly start your business in the red. If you're trying to make money to <a href="http://www.wisebread.com/5-day-debt-reduction-plan-pay-it-off?ref=internal" target="_blank">pay off debt</a>, that's the last thing you need. (See also: <a href="http://www.wisebread.com/11-signs-the-job-is-too-good-to-be-true?ref=seealso" target="_blank">11 Signs the Job Is Too Good to Be True</a>)</p> <h2>How Much Do MLM Distributors Really Make?</h2> <p>If you make money right out of the gate, then a nominal investment could be money well spent. Unfortunately, most distributors for MLM companies barely eek out a profit, let alone earn a full-time income from home. You can find proof directly on their websites.</p> <p>Let's go back to It Works!, the body wraps and personal care products company. According to its <a href="https://www.myitworks.com/Legal/Income/" target="_blank">2015 annual income disclosure statement</a>, 82% of its representatives had been with the company for an average of one month and were still on the first rung of the payment hierarchy &mdash; distributor status. Their monthly earnings ranged from a low of $1 to a high of $3,847, with a monthly average of $54.</p> <p>Income grows incrementally up the ranks, and tends to coincide with longer time spent growing the business. But income growth is slow, and the percentage of distributors who stick around more than a month drops dramatically. Only 7.8% of It Works! sales people are at the Executive level. They've been there an average of three months and earn an average of $231 a month. About 0.6% of reps are at Double Diamond level, making an average of $4,741 a month after 13 months of effort.</p> <p>Of course, some huge, mythical incomes do exist. According to the disclosure, the top tier income earner (. 02% of all distributors) &mdash; Ambassador Diamond &mdash; pulls in around $37,583 per month.</p> <p>Unfortunately, the average income for all It Works! Distributors was only $227 per month in 2015.</p> <p>And It Works! is far from the exception; their distributors actually make more than those working for many other MLM companies. Check out these annual income figures from other multilevel marketing disclosures for more proof:</p> <ul> <li><a href="https://issuu.com/thirtyoneleader/docs/income-disclosure-statement-2015" target="_blank">Thirty-One Gifts</a>: a company that sells organizational totes and monogrammed bags. In 2015, the average consultant (92.1% of distributors) earned $548 per year.<br /> &nbsp;</li> <li><a href="http://meltascent.com/download/scentsy-income-disclosure-statement/" target="_blank">Scentsy</a>: a company that focuses on candles and wax warmers. In 2014, the average lowest-level rep, called an Ecsential Consultant, earned $81 per year, while the average Certified Consultant (one level up from Ecsential) earned $463 per year.<br /> &nbsp;</li> <li><a href="https://www.advocare.com/opportunity/" target="_blank">Advocare</a>: a company that sells nutritional supplements and diet products. In 2015, the average annual compensation paid by Advocare to active distributors was $1,586.<br /> &nbsp;</li> <li><a href="http://www.beachbodycoach.com/uploads/fckeditor/mdbody/File/downloads/statement_of_independent_coach_earnings.pdf" target="_blank">BEACHBODY</a>: a company that sells fitness products and nutritional shakes. In 2015, the average BEACHBODY coach earned $502.<br /> &nbsp;</li> <li><a href="https://www.isagenix.com/~/media/compliance/earnings-statement/us-en-earnings-statement.pdf" target="_blank">Isagenix International</a>: a company that focuses on nutrition and diet products. In 2015, 87% of Isagenix business builders earned between $702 and $2,101, on average per year.</li> </ul> <p>As you can see, the average &quot;little guy&quot; is not making bank with any of these companies. In fact, your average distributor may be earning $100 per month or less. If they're a hobbyist who signed up for product discounts, then that might be fine by them. But when someone signs up to follow their dreams, the reality of not earning much can burn.</p> <p>MLM supporters argue that the reason so many people don't earn more is because they aren't really dedicated to building the business. Barriers to entry are very low, so many people sign up, then lose interest and give up in a way they wouldn't if they were building a regular business in which they'd had to invest more.</p> <p>But there are also real challenges to growing a viable business using the MLM model, even for committed salespeople. For example, many MLMs ask you to focus your sales efforts on family members and friends, which can be awkward and presents a limited pool of customers. Even if you expand your sales network, the products may be overpriced, making them difficult to sell.</p> <p>Lastly, it's not easy to grow your sales if your MLM is overly saturated with distributors already. And if you happen to recruit a distributor (the key to earning commissions), they then often become your competition.</p> <h2>Tips for Vetting an MLM Company</h2> <p>Just like anything else, it pays to do some research before you sign up for a multilevel marketing company. As the FTC notes, it's smart to not only consider the products, but to learn more about the company itself.</p> <p>Questions to ask should include:</p> <ul> <li>How long has the company been in business?</li> <li>What is its standing with the BBB?</li> <li>Has the company been sued for deceptive business practices?</li> <li>What are the company's annual sales?</li> <li>What percentage of average sales are made to distributors, as opposed to retail consumers?</li> </ul> <p>Beyond those considerations, the FTC suggests making sure you understand compensation structure, terms and conditions, and potential business expenses. Also, get all the company's details, including their refund policy, in writing.</p> <p>The U.S. Securities and Exchange Commission also offers an array of tips for people vetting a MLM and trying to avoid a pyramid scheme. According to the SEC, you should:</p> <ul> <li>Watch out for MLMs that don't appear to offer a product or service. If you can't figure out what a MLM sells, run.<br /> &nbsp;</li> <li>Be leery of MLMs that promise huge returns in a short amount of time. If it sounds too good to be true, it probably is.<br /> &nbsp;</li> <li>Be skeptical of companies that offer compensation for little work. Terms like &quot;easy money&quot; and &quot;passive income&quot; should be a red flag.<br /> &nbsp;</li> <li>Look for proof of retail sales. Ask to see documents that show how the MLM generated revenue from the selling of its products to people outside the program.<br /> &nbsp;</li> <li>Think long and hard before you &quot;buy in.&quot; Question the value of any opportunity that makes you purchase a product to get started.<br /> &nbsp;</li> <li>Watch out for complex commission structures. If it's hard to understand how you'll get paid or you can't figure out how commissions work, beware.</li> </ul> <p>Lastly, the FTC and SEC both suggest avoiding MLMs that place a heavy emphasis on recruiting members to work beneath you. The hallmark of a pyramid scheme is when you make more money recruiting than you do for product sales.</p> <p>Check out these <a href="https://www.ftc.gov/tips-advice/business-center/guidance/multilevel-marketing" target="_blank">FTC</a> and <a href="https://www.sec.gov/enforce/investor-alerts-bulletins/investoralertsia_pyramidhtm.html" target="_blank">SEC</a> pages for further details on how to vet a multilevel marketing company. While these companies do offer a path to earning extra income, the reality is that most of that income goes to the very top few earners, not to the average distributor like yourself. And if you don't wind up earning much, the costs of buying a &quot;starter kit&quot; and hosting parties could easily leave you in the red.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/holly-johnson">Holly Johnson</a> of <a href="http://www.wisebread.com/how-to-tell-if-that-home-business-opportunity-is-really-a-pyramid-scheme">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-yourself-from-an-investment-scam">How to Protect Yourself From an Investment Scam</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-vile-craigslist-scams-to-watch-out-for">8 Vile Craigslist Scams to Watch Out For</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/netspend-the-story-of-the-visa-debit-card-we-did-not-apply-for">netSpend: The Story of the Visa Debit Card We Did Not Apply For</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-work-perks-you-cant-get-as-a-freelancer">10 Work Perks You Can&#039;t Get as a Freelancer</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-tricky-interview-questions-successful-ceos-always-ask">5 Tricky Interview Questions Successful CEOs Always Ask</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career and Income Consumer Affairs businesses distributors MLM multilevel marketing pyramid schemes sales scams self employment work from home Fri, 03 Mar 2017 10:30:39 +0000 Holly Johnson 1902525 at http://www.wisebread.com 10 Ways to Keep Your Private Info Private http://www.wisebread.com/10-ways-to-keep-your-private-info-private <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-ways-to-keep-your-private-info-private" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-157397600.jpg" alt="Woman making sure her private info stays private" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>In a world where so many of us share everything from the birth of a child to our weight loss goals on social media, privacy might seem like a moot point. But the reality is, growing identity theft threats make safeguarding personal details more important than ever.</p> <p>The good news is, there are simple things you can do to keep yourself safe. It is just about paying attention to where your personal information could leak out, and plugging the holes. (See also: <a href="http://www.wisebread.com/careful-your-cc-may-be-sharing-this-private-info?ref=seealso" target="_blank">Your Credit Card May Be Sharing Your Private Info</a>)</p> <h2>1. Destroy Unneeded Paper Documents</h2> <p>Any junk mail that contains a credit offer. Old documents with your signature, Social Security number, date of birth, or other identifying details. Old tax returns. Convenience checks from credit cards. These are some of the most sensitive items that you should never dispose of without shredding. Buy a <a href="http://amzn.to/2jwjGhw" target="_blank">crosscut shredder</a> or take your documents to a business shredder to destroy, or burn the paper in your fireplace.</p> <h2>2. Safeguard Your Mail</h2> <p>The <a href="https://postalinspectors.uspis.gov/investigations/MailFraud/fraudschemes/mailtheft/TipThieves.aspx" target="_blank">U.S. Post Office recommends</a> that you pick up your mail promptly after delivery and always put the mail on hold if you go out of town. Some folks take it a step further by investing in a locking mailbox or renting a post office box away from their residence. Remember to protect outgoing mail as well, by dropping it into a secure mailbox or handing it to the carrier, instead of leaving it out for the carrier to pick up.</p> <h2>3. Be Wary of Online Forms</h2> <p>You may be asked for your name, email address, home address, phone number, date of birth, and other personal information many times a day on the Internet. And often, it's legitimate to share that information &mdash; for instance, when signing up for a food delivery service. But when asked for personal details, ask yourself who's behind the request &mdash; a reputable brand, or a company you've never heard of? Is the sign-up really necessary?</p> <h2>4. Don't Overshare on Social Media</h2> <p>First of all, know who you're sharing with when you post something on social media. On Facebook, you can choose to share a post with the public, with all your friends, or only a subgroup of friends. Personally, I don't know all the people I've accepted friend requests from very well. So most of the things I post &mdash; especially potentially compromising information such as an upcoming surgery or vacation &mdash; are only shared with a select group of close friends and relatives.</p> <p>Second, there are some things you don't want to share with anyone &mdash; not even relatives. Hundreds of thousands of people each year have their <a href="http://www.cnbc.com/2015/07/21/identity-theft-victims-may-know-the-culprit.html" target="_blank">IDs stolen by someone they know</a>. Never post a photo of personal documents, like a new passport or even a kid's report card. Beware of documents that may be visible in the background of snapshots, like that tax form stuck to your fridge with a magnet.</p> <h2>5. Conduct Periodic Audits of Your Online Info</h2> <p>This sounds complicated, but it's actually easy. First, Google your full name. Look yourself up on &quot;people search&quot; websites, especially <a href="https://www.washingtonpost.com/news/the-intersect/wp/2017/01/12/youve-probably-never-heard-of-this-creepy-genealogy-site-but-its-heard-all-about-you/?utm_term=.620bcefdccc0" target="_blank">FamilyTreeNow</a>, which allows people to search for personal data without paying or signing up for an account. A lot of the info you will find on these sites are public records, but that doesn't mean you want to make it easy for potential data thieves to aggregate all public info about you for free. Opt out of all such sites, which may take some time clicking around, but is worth it.</p> <h2>6. Be Suspicious of Everyone Who Handles Your Information</h2> <p>Your children's school and your doctor's office probably aren't out to rob you, so you might feel comfortable sharing any information they ask for. Here's the thing, though: Do you know if they're storing those documents securely or disposing of them properly when no longer needed? (See also: <a href="http://www.wisebread.com/7-simple-ways-to-protect-yourself-from-medical-records-theft?ref=seealso" target="_blank">7 Simple Ways to Protect Yourself From Medical Records Theft</a>)</p> <p>One way to limit your exposure to this risk is to give as little information as possible. Yes, every school form might ask for your child's medical insurance ID, but is it really necessary? At the doctor's office, decline to write your Social Security number on paperwork. They don't need it on every piece of paper in your file.</p> <p>Another way to limit your exposure is to ask staff how papers are handled and secured, and to push for better safety in the likely event that there's room for improvement.</p> <h2>7. Keep Your Computer Clean</h2> <p>Logging onto bank, mortgage, and credit accounts to pay bills, check balances, and transfer money is incredibly convenient. It can also be incredibly dangerous if you do it on a compromised computer. Be wary of what you click, whether it's an app you download or a link or attachment in email, because if your computer gets a virus, it could do more than slow it down. Hackers can use such Trojan horses to slip a keystroke logging program onto your computer, recording everything you type, including usernames and passwords. Never log onto banking and other sensitive sites using public Wi-Fi connections.</p> <p>Besides avoiding clicking dodgy links and regularly scanning your computer for malware, you can safeguard your online banking data by regularly changing your passwords, and by making your passwords really hard to guess.</p> <h2>8. Limit What You Carry Around With You</h2> <p>Stealing your purse or wallet is another way thieves can get ahold of your private information. Don't carry anything more than you need &mdash; one or two credit cards and your driver's license should do. Leave your Social Security card at home. (See also: <a href="http://www.wisebread.com/5-things-to-never-keep-in-your-wallet?ref=seealso" target="_blank">5 Things to Never Keep in Your Wallet</a>)</p> <h2>9. Opt Out of Junk Mail</h2> <p>You can sign up to <a href="https://www.consumer.ftc.gov/articles/0262-stopping-unsolicited-mail-phone-calls-and-email" target="_blank">stop credit and insurance companies</a> from sending you preapproved offers, which could be used to take out accounts in your name. (See also: <a href="http://www.wisebread.com/how-to-remove-yourself-from-mailing-lists-and-eliminate-junk-mail?ref=seealso" target="_blank">How to Remove Yourself From Mailing Lists and Eliminate Junk Mail</a>)</p> <h2>10. Don't Get Caught by a Phisher</h2> <p>Beware of impostors asking for your bank password or other information. You may already know that if you get an alarming email purportedly from your bank, you can go straight to your bank website and log on, or call them, instead of clicking the link.</p> <p>But increasingly, phishers are reaching victims by phone as well. So many people have been tricked into installing malicious software or giving up credit card numbers by fake &quot;Microsoft tech support&quot; calls that <a href="https://www.microsoft.com/en-us/safety/online-privacy/avoid-phone-scams.aspx" target="_blank">Microsoft set up a page</a> warning the public about them. The Internal Revenue Service has set up a <a href="https://www.irs.gov/uac/irs-urges-public-to-stay-alert-for-scam-phone-calls" target="_blank">similar warning</a> about criminals who call posing as IRS agents and ask for money or personal data. (See also:&nbsp;<a href="http://www.wisebread.com/beware-these-6-phony-irs-calls-and-emails?ref=seealso" target="_blank">Beware These 6 Phony IRS Calls and Emails</a>)</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-kirby">Carrie Kirby</a> of <a href="http://www.wisebread.com/10-ways-to-keep-your-private-info-private">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-panic-do-this-if-your-identity-gets-stolen">Don&#039;t Panic: Do This If Your Identity Gets Stolen</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-signs-that-a-winning-notification-email-is-a-fake">6 Signs That a Winning Notification Email Is a Fake</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/phishing-scams-continue-to-plague-social-media-sites">Phishing Scams Continue to Plague Social Media Sites</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/18-surprising-ways-your-identity-can-be-stolen">18 Surprising Ways Your Identity Can Be Stolen</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-sneaky-ways-identity-thieves-can-access-your-data">3 Sneaky Ways Identity Thieves Can Access Your Data</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Consumer Affairs data emails identity theft malware personal information phishing phone calls scams security viruses Thu, 02 Mar 2017 11:00:09 +0000 Carrie Kirby 1898692 at http://www.wisebread.com Beware These 6 Phony IRS Calls and Emails http://www.wisebread.com/beware-these-6-phony-irs-calls-and-emails <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/beware-these-6-phony-irs-calls-and-emails" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-509629604.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="143" /></a> </div> </div> </div> <p>It's 2017. Most people aren't really thinking of filing taxes just yet, but they are starting to collect the information needed to file by the April deadline. That means the scammers are out in force again, ready to trick millions into submitting personal information, or to make payments that will go into the pockets of thieves.</p> <p>These six scams are the biggest offenders, and once again, they'll be used widely this year. Watch out for them.</p> <h2>1. The &quot;You've Got a Refund&quot; Email</h2> <p>Who doesn't love getting money back from the IRS? When you get this one in your inbox, you could certainly be fooled into thinking it's legitimate. Unlike many of the phishing emails, it appears to have decent grammar, it's well formatted, and it has something of an official look to it. What's more, the <a href="https://www.irs.gov/pub/irs-utl/phishing_email.pdf" target="_blank">refund isn't huge</a>. If it had stated you were getting many thousands back, you may pause for thought. But a small sum, under $100, is less likely to trigger alarm bells. It all seems legit. But, it's not. And by clicking the link in the email, you are going to a fraudulent site designed to collect personal and banking information.</p> <p>As the IRS clearly states on its website, it will never initiate contact with taxpayers over email, text messages, or social media channels. The main contact is snail mail, and while you may get actual calls, they will be easy to verify (more on that later).</p> <p>Do not look at the &quot;from&quot; email address, either. These can be simulated to look like they have come from an official agency. Look at the link address in the email; this will definitely be going to a site that tries to look official, but isn't, such as <a href="http://www.irs-gov.com/refund" title="www.irs-gov.com/refund">www.irs-gov.com/refund</a>. The bottom line: Any kind of &quot;you've got a refund&quot; email from the IRS is a scam, and should be <a href="https://www.irs.gov/uac/report-phishing" target="_blank">reported to them immediately</a>.</p> <h2>2. The &quot;The Bill Was Lost in the Mail&quot; Call</h2> <p>If you receive a call from the IRS saying you owe money, it's a scam. That's just a hard fact. The IRS clearly states on its website that it will never call you if you owe taxes, without first sending you a bill in the mail. Of course, thieves are getting wise to this being common knowledge, and are now saying that the bill must have gotten lost in the mail.</p> <p>At this point, you may well be put into a world of self-doubt; and that's when the scammer jumps on the opportunity. They hear the hesitation in your voice, and start alarming you. They will say that as the bill has been long overdue, you are now in serious trouble. You have to pay the back taxes immediately or risk going to jail. It's at this point that many people become so scared that they pay up. This is all a con, and you can easily verify this.</p> <p>For starters, a real IRS agent will not ask for money over the phone. If this is the request, hang up. They also will not threaten you with arrest or deportation. You can also ask for their IRS badge number and call back number. The scammer will hang up on you.</p> <h2>3. The &quot;Affordable Care Act&quot; Email</h2> <p>One of the downsides of the Affordable Care Act is that it is still quite new, and therefore, has many unknowns. There is even a page on the IRS website dedicated to the intricacies surrounding the <a href="https://www.irs.gov/affordable-care-act/individuals-and-families/the-affordable-care-act-whats-trending" target="_blank">new health care law</a>; and that is perfect fodder for a scammer. Where there is doubt, there is a chance to profit.</p> <p>The scam will come as an email (and in some rare cases, a letter) alerting you to something called a CP2000 notice. It's worth noting that this is, in fact, a real type of notice. But in this case, it's completely fake. The big giveaway is that it is issued from an Austin, Texas address, with a phony payment voucher number called a 105C.</p> <p>The scam uses language designed to scare you into paying the bill, and here's another huge red flag &mdash; the check should be made payable to &quot;I.R.S.&quot; at an Austin Processing Center address. If you receive anything like this via email, forward it to the IRS. They are currently <a href="https://www.irs.gov/uac/irs-and-security-summit-partners-warn-of-fake-tax-bill-emails" target="_blank">investigating this nasty scam</a>.</p> <h2>4. The &quot;Please Verify Your Tax Information&quot; Call</h2> <p>Not all IRS scams are designed for immediate profit. This one is designed to harvest your personal information, which can then be used for identity theft, or to actually grab a refund owed to you before you even claim it. In 2013, the IRS paid out over <a href="http://www.gao.gov/products/GAO-15-119" target="_blank">$5.8 billion in stolen tax refunds</a>, and the problem is not going away.</p> <p>As the scammer is not asking you to pay a bill, it can feel much less threatening. The fake agent will be very polite, and will say that the IRS needs to verify some information on a tax return you previously filed. They may even have some personal information that makes it sound like they have your file right there in front of them. But, the information they really want, like your SSN or bank details, will not be available.</p> <p>Questions will start out simple: &quot;I have your name as John S. Doe, could you spell that please?&quot; But this will quickly lead to &quot;And could you verify your social security number for me?&quot; At this point, the scammer won't have anything to work with, and is hoping you simply parrot back the response.</p> <p>Remember, the IRS will not call you asking for this kind of information. If you do have an issue with a former return, you will get an official notice in the mail, asking for the information to be verified. And if you doubt that, call the IRS directly.</p> <h2>5. The &quot;IRS Taxpayer Advocate&quot; Email</h2> <p>In 2014, the IRS warned of a new scam that was designed to solicit personal information, leading to identity theft and stolen tax refunds. This is known as the &quot;<a href="https://www.irs.gov/uac/newsroom/irs-warns-of-new-email-phishing-scheme-falsely-claiming-to-be-from-the-taxpayer-advocate-service" target="_blank">IRS Taxpayer Advocate Service</a>,&quot; and comes complete with a legitimate-looking case number, and language designed to grab sensitive personal and financial information.</p> <p>The email, which comes with a &quot;from&quot; address designed to look real, tells you that a former tax return you filed was flagged for review due to a document processing error. Once again, you will always be notified of any problems like this via regular mail, not email.</p> <p>The email will then say that you must click on a link to submit the missing or erroneous information, which will expedite the filing of the return to avoid any fees or charges. Of course, that link leads to a page hosted by the scammer, designed to collect and abuse your information.</p> <h2>6. The &quot;Federal Student Tax&quot; Call</h2> <p>A new tax scam surfaced last year, and it sadly tricked a few unsuspecting people into handing over iTunes gift cards, W-2 information, or tax return data. If that sounds a bit obvious, it's all done in a way that makes it feel legitimate.</p> <p>The scammer will call a student and tell them that they owe &quot;Federal Student Tax,&quot; which must be paid immediately. There's no such thing as the Federal Student Tax. It's a complete fabrication.</p> <p>However, the scammers have become much more sophisticated. For example, they are using caller ID spoofing to make the call look like it is coming from an official government line. Plus, information made available on the dark web can give them all sorts of information about the student's background. Together with a very professional sounding &quot;agent,&quot; this can all work to convince the student the tax must be paid. And often, they request the money in the form of gift cards, which is another huge red flag. Again, the IRS won't call and ask for money. If this is happening to you, or someone you know, tell them to hang up and <a href="https://www.irs.gov/uac/report-phishing" target="_blank">report the incident to the IRS</a>.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/beware-these-6-phony-irs-calls-and-emails">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam">What to Do When You Suspect a Scam</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away">How to Spot a Charity Scam From a Mile Away</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/top-three-tax-facts-to-know-for-2016">Top Three Tax Facts to Know for 2016</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/most-popular-ways-americans-spend-their-tax-refunds">Most Popular Ways Americans Spend Their Tax Refunds</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-choose-the-best-tax-preparer">How to Choose the Best Tax Preparer</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Taxes emails fraud IRS phishing scams safety scams tax refunds theft Wed, 25 Jan 2017 11:00:08 +0000 Paul Michael 1878111 at http://www.wisebread.com How to Protect Yourself From an Investment Scam http://www.wisebread.com/how-to-protect-yourself-from-an-investment-scam <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-protect-yourself-from-an-investment-scam" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-479413254.jpg" alt="don&#039;t fall for these investment scams" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>There's nothing wrong with putting your money to work for you. Investments can be the difference between making ends meet, and making a mint. But remember your mom's advice: If it sounds too good to be true, it probably is.</p> <p>Following this warning is one of the best ways to avoid financial scams. Here's a list of some infamous investment frauds, and ways to spot red flags. Pay attention. Make your mom proud &mdash; and your wallet happy.</p> <h2>The Classic: Pyramid Scheme<strong> </strong></h2> <p>Many pyramid schemes come across as multi-level marketing opportunities. Investors pay fees to join and then make money from direct sales. Backers also get a cut of profits from folks they've recruited to the program. But pyramid organizers need this new money to pay off earlier investors, and often, the scheme collapses under its own weight. There's not enough money to make payoffs. Participants see investments and returns disappear.</p> <p>Pyramid schemes often spread through social media, websites, online ads, and group pitches. Be alert to these warning signs.</p> <ul> <li>You're told you'll make a lot of money quickly, but you won't have to put in much effort.</li> </ul> <ul> <li>You have to pay a fee to join, and your main role is getting others to sign up.</li> </ul> <ul> <li>Any product that's sold has little value outside the scheme.</li> </ul> <ul> <li>You can't find evidence, such as professionally audited financial statements, of sales profits. Money comes from recruitment.</li> </ul> <ul> <li>Profits come from within the program. Your earnings depend upon other participants, not on outside sales.</li> </ul> <p>Lots of money, little work: this is exactly what your mother was talking about.</p> <h2>Risky Business: Energy Scams<strong> </strong></h2> <p>Legitimate investment opportunities in oil and gas development come with no guarantees. They need lots of money and time, and proceeds are uncertain. Developers might drill and drill with little return for their efforts. Investors can lose everything they put in. And that's with authentic energy exploration. If the whole purpose is to separate you from your money, participants don't stand a chance.</p> <p>So how do you separate real energy investment deals from scams? Be on the lookout for these warning signs.</p> <ul> <li>Company offices are in one state, drilling is in another, and investors don't live in either. You can't easily visit the corporation or well site. If fraud is suspected, the geographic range creates a nightmare for law enforcement investigators.<br /> &nbsp;</li> <li>You receive a surprise email or phone call. You don't hear a lot of facts, just tremendous pressure to commit. You're warned that if you don't immediately jump in, you'll miss out. Real energy companies don't fish around for investors.<br /> &nbsp;</li> <li>Little risk, high returns: Is that what you've been promised? Run away, because that's not how it really works in the energy business.</li> </ul> <ul> <li>Some get-rich-quick scams use current events as lures. If high gas and oil prices are currently in the news, investors might be convinced the time is right. But remember, well development is a long process.</li> </ul> <ul> <li>If the company is secretive and doesn't want you to talk to anyone about your investment opportunity, there's a good reason for that. It's a shady proposition. You should be encouraged to consult others and investigate the deal. And all your questions should get answers &mdash; in writing. If you get shut down, close your wallet.</li> </ul> <p>Energy development is a business, not a mystery. All aspects should be open and aboveboard.</p> <h2>I'm Just Like You: Affinity Sham<strong> </strong></h2> <p>Affinity fraud targets participants based on a specific characteristic, such as age, religious affiliation, or ethnicity. Schemers present themselves as members of the same group in order to create an immediate relationship. Some hustlers are so good they enlist recognized leaders of the community. Unfortunately, these respected notables wind up falling prey to the scam &mdash; and unintentionally drawing others in.</p> <p>You might feel a connection to the individual trying to get you to invest, but that's what these con artists count on. Be wary.</p> <ul> <li>Don't invest just because you have an association with the promoter &mdash; even if it's someone you trust. That person may have been duped. Do outside research. If that's discouraged, say no. Real investments hold up against scrutiny.<br /> &nbsp;</li> <li>Avoid online opportunities that show up in chat groups, bulletin boards, or websites exclusive to your group. The Internet is a quick and easy way to target a specific audience.<br /> &nbsp;</li> <li>Steer clear of any investment that guarantees low risk and high returns. The two just don't go together. Valid deals don't promise them.</li> </ul> <p>The bottom line here &mdash; listen to your mother. When it comes to changing your socks, eating your vegetables, and avoiding fraud, she knows best.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/anum-yoon">Anum Yoon</a> of <a href="http://www.wisebread.com/how-to-protect-yourself-from-an-investment-scam">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-tell-if-that-home-business-opportunity-is-really-a-pyramid-scheme">How to Tell if That Home Business Opportunity Is Really a Pyramid Scheme</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away">How to Spot a Charity Scam From a Mile Away</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-panic-do-this-if-your-identity-gets-stolen">Don&#039;t Panic: Do This If Your Identity Gets Stolen</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-more-scams-everyone-should-know-about">10 More Scams Everyone Should Know About</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-stay-away-from-penny-stocks">5 Reasons to Stay Away From Penny Stocks</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Consumer Affairs Investment advice energy scams fraud money protection multi level marketing pyramid schemes scams Wed, 21 Dec 2016 10:31:29 +0000 Anum Yoon 1858984 at http://www.wisebread.com How to Spot a Charity Scam From a Mile Away http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-spot-a-charity-scam-from-a-mile-away" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_phone_park_621595942.jpg" alt="Man learning how to spot a charity scam from a mile away" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>When it comes to donating to charity, people have good intentions. They want to give to a worthy cause, but unfortunately, so many individuals do very little research before opening up their checkbooks.</p> <p>While many charities are legitimate, there are several that should be avoided. They are the ones that rate low, with the majority of their funds being funneled into the pockets of CEOs or marketing efforts. For example, the Catholic League for Religious and Civil Rights is one charity that is low-rated by <a href="http://www.charitynavigator.org/index.cfm?bay=topten.detail&amp;listid=8">Charity Navigator</a>, yet has one of the highest paid CEOs. (See also: <a href="http://www.wisebread.com/surprisingly-easy-ways-you-can-support-charity?Ref=seealso">Surprisingly Easy Ways You Can Support Charity</a>)</p> <p>Here's how to make sure your donation is winding up in the right hands.</p> <h2>Make Sure the Name Is Right</h2> <p>Some notable low-rated charities have made it a point to choose names similar to popular nonprofit organizations. For example, Cancer Research Institute is a highly rated charity, but Cancer Survivors' Fund and American Association for Cancer Support are both low-rated charities, according to <a href="http://www.consumerreports.org/charitable-donations/best-and-worst-charities-for-your-donations/">Consumer Reports</a>. Both of the low-rated charities have important sounding names, and it can be easy to confuse them when there are so many to keep track of.</p> <h2>Avoid Callers</h2> <p>Don't give in to pesky callers asking for donations. Often telemarketers are hired by select charities to help raise funds. However, the charity does not get all of those funds. Instead, a lot of your donation will end up going to the marketers rather than your cause. Definitely do not give any personal information, such as your credit card or Social Security number to any charity. Most importantly, if anybody pressures you to give money, then it is best to walk away.</p> <h2>Know Where the Money Goes</h2> <p>The highest rated charities are very transparent about where their money goes. You should be able to see the organization's annual expense reports or the charity's Form 990. Churches and other big religious groups are not required to file 990s, so be sure to check them out at <a href="http://www.ministrywatch.com/">Ministry Watch</a>, a website that helps alert donors to fraudulent religious charities. (See also: <a href="http://www.wisebread.com/5-ways-giving-to-charity-is-good-for-you?ref=seealso">5 Ways Giving to Charity Is Good for You</a>)</p> <h2>Don't Donate Cash or Give Through Wire Transfers</h2> <p>Never give any charity cash or send money through wire transfers. If the charity insists on cash or a wire transfer, it should make you suspicious of the organization. But what about religious tithing? While dropping cash in your local place of worship's donation bucket doesn't mean you are donating to a scam charity, it is still wiser to write a check or donate online. This will allow you to keep track of your charitable giving for tax purposes. If you do give cash, try your best to get a receipt.</p> <h2>Be on Alert</h2> <p>During the holidays, more for-profit charities are likely to increase their marketing. Expect more calls and emails that will appeal to your emotions. Of course you want to help wounded veterans, homeless children, and abused pets but if you have never heard of the charity, then don't rush into donating. Charity scams also are more likely to pop up after a natural disaster, such as a hurricane.</p> <p>Ask a charity if they are registered, and if they claim they are, then get the registration number. Also know that most respectable charities do not ask for donations via email, unless an individual has already signed up for the mailing list.</p> <h2>Do Some Research</h2> <p>Before you donate a large sum of money to any charity, spend a few minutes researching the organization. You should be able to find the rating of charities on the <a href="https://www.bbb.org/">Better Business Bureau</a>, <a href="http://www.charitynavigator.org/">Charity Navigator</a>, <a href="https://www.charitywatch.org/">Charity Watch</a>, <a href="http://www.give.org/">BBB Wise Giving Alliance</a>, and <a href="http://www.consumerreports.org/">Consumer Reports</a>.</p> <p>It is best to decide at the beginning of the year what your annual charitable giving will be and which charities you want to donate to. This then puts you and your budget in the right place for donating money and helping those in need.</p> <p>Charity scammers take advantage of people's goodwill and desire to help. However, these scammers can steal more than just your money. They can steal your identity if you give out too much information. Give to causes you care about while also protecting your bank account and personal information.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-charities-you-can-trust-with-your-holiday-donations">8 Charities You Can Trust With Your Holiday Donations</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-safe-is-craigslist">How Safe Is Craigslist?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam">What to Do When You Suspect a Scam</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-panic-do-this-if-your-identity-gets-stolen">Don&#039;t Panic: Do This If Your Identity Gets Stolen</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-more-scams-everyone-should-know-about">10 More Scams Everyone Should Know About</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Consumer Affairs charity donating fraud Giving Back scams theft things to watch out for wire transfers Thu, 08 Dec 2016 12:30:07 +0000 Ashley Eneriz 1849882 at http://www.wisebread.com Don't Panic: Do This If Your Identity Gets Stolen http://www.wisebread.com/dont-panic-do-this-if-your-identity-gets-stolen <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/dont-panic-do-this-if-your-identity-gets-stolen" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/data_breach_58553266.jpg" alt="Learning what to do if your identity gets stolen" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The Bureau of Justice Statistics (BJS) reported that in 2014, 17.6 million Americans aged 16 or older were <a href="http://www.bjs.gov/content/pub/pdf/vit14_sum.pdf">victims of identity theft</a>. That, alone, is a scary fact. And to be honest, when anyone says the phrase &quot;identity theft,&quot; most of us picture lives being upended, years of court cases, and bank accounts being wiped out.</p> <p>But let's look a little deeper into this issue, because while it is definitely something to keep on your radar, identity theft is a broad term. Plus, these days, with so many people being affected, there are more resources available than ever before to help you out. So before you go into full-blown panic mode&hellip;read on.</p> <h2>It's Highly Unlikely Someone Will Actually &quot;Steal&quot; Your Identity</h2> <p>Of the 17.6 million Americans that were victims of identity theft in 2014, only 4% of them actually had their personal information used to open a new account. Think about that for a second, and you should already be feeling much more calm. The chances of someone actually pretending to be you, opening up account everywhere in your name, and sinking you into a world of pain, are very slim indeed. Sadly, media outlets and the news don't like to cover that, because it's not sexy, and it doesn't get ratings. That's why the identity theft stories you hear about are horrific. But in reality, it is highly unlikely that you will have your literal identity stolen.</p> <h2>Identity Theft Is a Very Broad Term</h2> <p>The phrase itself puts most people in a cold sweat, but it covers a lot of different aspects of the crime. The vast majority of identity theft crimes, around 86%, are tied to the misuse of a credit card or bank account. That's it. Someone grabs your digits, takes out some cash, and calls it a day before the card gets canceled. Or, they withdraw a bunch of money and move on to someone else's account. Either way, it's quick and dirty, but rarely goes beyond that level of theft. And as the next point proves, it's not worth worrying about&hellip;</p> <h2>Credit Card and Bank Account Misuse Is Covered</h2> <p>If someone manages to get hold of your credit card, either by stealing or cloning it, they will undoubtedly go on a shopping spree. But you don't have to worry. While the initial shock of seeing thousands in charges you didn't accrue is horrifying, you are not on the hook for it. Card issuers and bank accounts cover you <a href="https://www.consumer.ftc.gov/articles/0213-lost-or-stolen-credit-atm-and-debit-cards">for most (and generally all) of the theft</a>. You will get all of those funds put back onto your account, usually very quickly, and the card issuer or bank will take the hit and investigate the crime. Sadly, very little of this money is recovered from the thieves who did the spending. Unless there is CCTV footage of them committing the crime, and significant evidence to track them down, they'll get away with it. But rest assured, you won't have to foot the bill.</p> <h2>Over 52% of Identity Theft Victims Resolve the Problem in a Day or Less</h2> <p>Not years. Not months. Not weeks. Just one day. That should come as great comfort if you're worried about the time and expense it could take to sort out the mess some nasty crook has created for you. And here's further cause to relax&hellip;only 9% of victims spent more than a month trying to get their lives back on track, and even then, it was not a month taken off work, fighting eight hours a day, seven days a week. It is simply a process that can take time to get right.</p> <h2>This Is a Common Problem, So You'll Get Help</h2> <p>When identity theft first popped up, it was hard to get card issuers and banks to listen to the facts. But these days, that has all changed. There were more victims of identity theft in 2014 than <a href="https://ucr.fbi.gov/crime-in-the-u.s/2014/crime-in-the-u.s.-2014/offenses-known-to-law-enforcement/property-crime/property-crime">there were property crimes</a>, so it's definitely on law enforcement's radar. Most credit card companies monitor accounts very closely, and track your spending habits. They will often shut down a card immediately if they believe there is suspicious activity going on &mdash; for instance, an unusually large purchase, many purchases in one day, or purchases made out of state.</p> <p>If your card is stolen, report it the moment you notice it is gone, or has been cloned. If you see a new account has been opened in your name, report that immediately. These companies want your business, and they are setup to handle this kind of crime.</p> <h2>It's Easy to Stop Identity Theft in Its Tracks</h2> <p>These days you have resources and tools to monitor your accounts and your credit reports. The Federal Trade Commission (FTC) puts this kind of protection into two basic categories.</p> <h3>Credit Monitoring</h3> <p>This tracks activity on your credit reports, and notifies you if a company checks your credit history, a new account is opened in your name, a debt collector reports a late payment, your credit limits change, or your personal information changes. It's worth noting that this isn't actually protection, but a warning. However, once you're alerted, you can act on that information.</p> <h3>Identity Monitoring</h3> <p>This alerts you when personal information, including your driver's license, passport, Social Security number, medical ID number, or bank account information, is used in ways that don't show up on your credit report.</p> <p>You will already know of major identity theft protection sites and services out there, including LifeLock, CompleteID, IdentityGuard, and IDShield. Your bank account and credit card issuers may also have their own version of identity theft protection for you to take advantage of. All of these services require a nominal monthly fee, but for the peace of mind offered, it's worth it.</p> <h2>Criminals Need More Than Just Your Personal Information</h2> <p>If you see a news story talking about a data breach, take the time to find out what has actually been stolen. As Time reported in 2015, criminals can do very little with your name, birth date, and email address. Even with your address and phone number on top of that, they aren't going to be able to do much without a SSN and/or account numbers and passwords. The most they can do is some kind of &quot;phishing&quot; scam, where they will use your personal information to try and get money out of you in some way, via phone or email. But use your common sense, and never respond to a cold call or email. Always contact a business yourself to verify this.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/paul-michael">Paul Michael</a> of <a href="http://www.wisebread.com/dont-panic-do-this-if-your-identity-gets-stolen">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-to-keep-your-private-info-private">10 Ways to Keep Your Private Info Private</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/phishing-scams-continue-to-plague-social-media-sites">Phishing Scams Continue to Plague Social Media Sites</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/18-surprising-ways-your-identity-can-be-stolen">18 Surprising Ways Your Identity Can Be Stolen</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away">How to Spot a Charity Scam From a Mile Away</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-to-never-keep-in-your-wallet">5 Things to Never Keep in Your Wallet</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Life Hacks Consumer Affairs credit monitoring data breach fraud hacked identity theft illegal phishing scams social security stolen money Tue, 25 Oct 2016 10:30:09 +0000 Paul Michael 1819826 at http://www.wisebread.com 8 Terrible Work-From-Home "Jobs" You Should Avoid http://www.wisebread.com/8-terrible-work-from-home-jobs-you-should-avoid <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-terrible-work-from-home-jobs-you-should-avoid" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_stressed_computer_94970603.jpg" alt="Woman avoiding terrible work-from-home &quot;jobs&quot;" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Working from home can be very rewarding, and it can provide the type of lifestyle you've been seeking. The number of remote jobs is also increasing, with 20 to 30 million people working from home at least one day a week. If you're ready to start working remotely, it's important to do your due diligence and use <a href="http://www.wisebread.com/tips-for-finding-legitimate-work-at-home-opportunities">reputable job sites</a> to find a legitimate work-from-home job.</p> <p>However, there are some work-from-home jobs that just aren't worth the time or energy. According to FlexJobs, there are <a href="https://www.flexjobs.com/blog/post/7-signs-dream-craigslist-job-scam/">60-70 scams for every legitimate job</a> opportunity, so we've covered some of the most common scams to help save you time on your search. When in doubt, if it sounds too good to be true, it probably is.</p> <h2>1. Stuffing Envelopes</h2> <p><a href="https://www.consumer.ftc.gov/articles/0112-envelope-stuffing-schemes">Stuffing envelopes is the oldest scam</a> in the book, dating back to the 1920s. Many people consider this to be a pyramid scheme that will end up costing you more than you make. According to the Federal Trade Commission (FTC), the only way to make money from this &quot;job&quot; is to persuade your friends and family to sign up for the same scam that you did.</p> <p>Often, you'll be required to invest in a starter kit, so you'll need to spend money upfront, and typically, the kit never even arrives. It is extremely rare that anyone actually makes money stuffing envelopes, and even if you did make money, it would be in the pennies, or you would only generate income if the mailings generate responses.</p> <h2>2. Craft Making</h2> <p>It may sound like fun to craft for a living, but you will often spend more than you make with these endeavors. If you are required to pay for your own materials upfront, this is a good sign that it's a scam. In fact, most of these companies are making money selling the starter kits, not selling the assembled product. Often, the company will claim that the crafts you assembled don't meet their specifications (even if you assembled them perfectly), so you won't get paid for your hard work and will be left with assembled crafts that you can't use.</p> <h2>3. Costly Billing</h2> <p>Any position that requires you to purchase expensive computer software or equipment upfront is typically a scam. Medical billing &quot;jobs&quot; typically require this. In fact, when it comes to medical billing, the vast majority of offices choose not to outsource their billing services to individuals in order to observe health care privacy rules. Instead, they opt for established companies with on-site, trained workers.</p> <h2>4. Check Cashing</h2> <p>Typically, these types of jobs will require you to cash a check in your personal bank account. You get to keep a portion of the check and send the remainder to the hiring company. In most cases, the check is a fake and you will be held financially responsible. Cashing a check for someone puts the full responsibility on you. This means that if the check bounces, it's your responsibility to repay the debt. Along with potentially costing you money, check-cashing schemes can be illegal.</p> <h2>5. Money Laundering</h2> <p>This scheme works similarly to a check-cashing scheme. You will be asked to transfer money in and out of your personal bank account. This money may have been acquired through illegal means, which means that you could be at risk of having criminal charges brought against you.</p> <h2>6. Filling Out Surveys</h2> <p>Completing online surveys may seem like fun, easy work, but you will only get paid pennies for each one &mdash; meaning it will usually take more than a day to make just $1. These companies usually don't pay out until you've made $20 or more, which can take weeks or even months. It's just not worth your time.</p> <h2>7. Reshipping Services</h2> <p>This &quot;job&quot; may sound simple enough. You are required to accept shipped goods to then repackage and ship them to new locations. However, the items have usually been ordered with stolen credit cards, which means that you could be at risk of prosecution for the transport of stolen goods.</p> <h2>8. Postal Jobs</h2> <p>While working for the post office isn't a scam in itself, one of the most common work-from-home scams is for hidden or &quot;previously undisclosed&quot; federal government jobs, such as post office positions. According to the Federal Trade Commission (FTC), any <a href="https://www.consumer.ftc.gov/articles/0083-government-job-scams">federal and postal job postings</a> should be free to apply to and can be found on <a href="https://www.usajobs.gov/">USAjobs.gov</a> or through the <a href="http://about.usps.com/careers/welcome.htm">USPS site</a>.</p> <p>Another common scam is paying someone to help you pass the postal exam. This exam is basically an aptitude test, so it isn't something you need to study for. Therefore, it doesn't make sense to pay for practice exams or tips to help you pass. Some companies will even offer a refund if you don't pass the postal exam, but then won't pony up when you do fail.</p> <h2>How to Avoid a Scam</h2> <p>The best way to avoid a terrible work-from-job is to do your research. Check the company out on the Better Business Bureau, look online for complaints or reviews, and think twice before spending any money on the position. You should be cautious of any job that requires you to <a href="https://www.consumer.ftc.gov/articles/0243-job-scams">pay money upfront</a> for supplies, training programs, or application processing fees. You should never have to pay to get a job. If the job title or description is generic or vague, this can also be a red flag. (See also: <a href="http://www.wisebread.com/6-ways-to-spot-work-at-home-job-scams?ref=seealso">6 Ways to Spot Work-at-Home Job Scams</a>)</p> <p>If you're confident that you're working for a legitimate company, but they still want you to purchase equipment or software upfront, inquire about the return policy if the position doesn't work out. Most importantly, you should never give out your credit card or bank account number to a potential employer. Another red flag is if they ask for any sensitive personal information, such as your social security number or driver's license number. Not only is this a red flag, but it may also put you at risk of identity theft.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F8-terrible-work-from-home-jobs-you-should-avoid&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F8%2520Terrible%2520Work-From-Home%2520Jobs%2520You%2520Should%2520Avoid.jpg&amp;description=8%20Terrible%20Work-From-Home%20Jobs%20You%20Should%20Avoid"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/8%20Terrible%20Work-From-Home%20Jobs%20You%20Should%20Avoid.jpg" alt="8 Terrible Work-From-Home &quot;Jobs&quot; You Should Avoid" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/8-terrible-work-from-home-jobs-you-should-avoid">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-places-to-find-freelance-writing-jobs">6 Places to Find Freelance Writing Jobs</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/day-job-or-freelance-which-is-right-for-you">Day Job or Freelance: Which Is Right for You?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/22-websites-that-will-pay-you-to-write-for-them">22 Websites That Will Pay You to Write for Them</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/17-part-time-jobs-to-do-while-your-kids-are-at-school">17 Part-Time Jobs to Do While Your Kids Are at School</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-make-money-as-a-chat-or-forum-moderator">How to Make Money as a Chat or Forum Moderator</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Extra Income Job Hunting internet scams job hunting job scams job search scams side job work from home work from home jobs Tue, 04 Oct 2016 10:00:15 +0000 Andrea Cannon 1805245 at http://www.wisebread.com 3 Sneaky Ways Identity Thieves Can Access Your Data http://www.wisebread.com/3-sneaky-ways-identity-thieves-can-access-your-data <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/3-sneaky-ways-identity-thieves-can-access-your-data" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/computer_password_88375551.jpg" alt="Finding sneaky ways identity thieves can access data" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You just can't be too careful nowadays.</p> <p>From 2010 to 2015, identity thieves have stolen <a href="http://www.iii.org/fact-statistic/identity-theft-and-cybercrime">$112 billion</a> from U.S. consumers. A staggering 13.1 million victims of identify theft lost $15 billion in 2015 alone. To curb more cases of identity theft, more and more issuers of credit and debit cards are transitioning their clients to cards with chip technology. (See also: <a href="http://www.wisebread.com/4-ways-chip-credit-cards-make-life-easier?ref=seealso">4 Ways Chip Credit Cards Make Life Easier</a>)</p> <p>Still, there are plenty of methods for criminals to get a hold of your personal information. Let's review three more ways thieves can steal your identity and how to protect yourself against them.</p> <h2>1. Mailbox</h2> <p>Snail mail can be annoying in more ways that you think. While receiving paper copies of statements of your bank accounts, credit card accounts, retirement accounts, or investment accounts can save you the cost of printing them out yourself, keep in mind that it also opens the door for potential identity theft. For example, all it takes is a thief to get a hold of a bank account or credit card statement and try his luck changing your mailing address and requesting a replacement card. Don't let somebody go on a shopping spree with your hard-earned dollars!</p> <p>Another target inside your mailbox is any prefilled credit card or loan application. That little trash bin right next to the mailbox area in your apartment building is a gold mine for identity thieves.</p> <h3>How to Prevent It</h3> <p>The U.S. Postal Service (USPS) recommends you avoid leaving mail in your mailbox overnight or on weekends. If you plan to be away from home from three to 30 consecutive days, use the <a href="https://holdmail.usps.com/holdmail/">USPS Hold Mail Service</a> to schedule delivery of all mail on the day of your return.</p> <p>Also, make sure that you deposit any mail containing personal information only on U.S. Postal Service collection boxes and securely discard any letters of preapproved offers of credit. You also can opt out of unsolicited credit and insurance offers by calling 1-888-5-OPT-OUT (1-888-567-8688) or visiting <a href="http://www.optoutprescreen.com">www.OptOutPrescreen.com</a>.</p> <h2>2. Fake Public Wi-Fi</h2> <p>Whether struggling to keep your data usage within the limits of your existing phone data plan or trying to upload a perfect Instagram selfie during your trip to Italy, many of us can't resist the promise of free Internet from a public hot spot. Malicious hackers are aware of this and set up fake public Wi-Fi hot spots to lure users and steal their data.</p> <p>Main targets are commuters doing work and exposing valuable information, such as lists of clients, business expense accounts, and invoices. If you think getting your identity stolen is bad, imagine exposing that of your clients or coworkers to cyber criminals. And those hackers don't have to be anywhere close to you: They can be <a href="http://abcnews.go.com/Business/story?id=3454066&amp;page=1">up to 100 feet</a> away and still get away with your identity.</p> <h3>How to Prevent It</h3> <p>Only activate your Wi-Fi port when you're about to connect to a known and secure Wi-Fi. Whenever possible, check the authenticity of a hot spot. For example, ask the reception desk attendant at a hotel or check billboards at a mall.</p> <p>When using public Wi-Fi connections, don't visit sites related to your personal finance. If you absolutely must use a public Wi-Fi for work, only do so by connecting through your company's Virtual Private Network (VPN) to encrypt all data during your session.</p> <h2>3. Email</h2> <p>You don't need to be a major celebrity for somebody to try hacking your email account. All it takes is the suspicion that you may have a lot of financial assets or are in the process of a major financial transaction, such as closing a mortgage, executing an estate, or applying for a student loan.</p> <p>While you may think that it takes really complicated hacking skills to decipher a password, the harsh reality is that most people use the simplest of passwords. According to a <a href="http://gizmodo.com/the-25-most-popular-passwords-of-2015-were-all-such-id-1753591514">list of over two million leaked passwords</a>, the top five passwords of 2015 were:</p> <ol> <li>123456</li> <li>password</li> <li>12345678</li> <li>Qwerty</li> <li>12345</li> </ol> <p>Internet uses don't learn from their mistakes: The top two most commonly used passwords of 2015 were also the top two of the list from the previous year. Even worse, nearly three out of four individuals <a href="https://www.entrepreneur.com/article/246902">use the same password</a> for multiple accounts. By unlocking your email password, hackers have a good chance of getting a hold of your other online accounts.</p> <h3>How to Prevent It</h3> <p>Microsoft recommends using passwords that:</p> <ul> <li>Are at least <a href="https://blogs.microsoft.com/microsoftsecure/2014/08/25/create-stronger-passwords-and-protect-them/">eight characters</a> in length;<br /> &nbsp;</li> <li>Don't contain your username, real name, or company name;<br /> &nbsp;</li> <li>Don't spell out complete words (sorry sports fans: football and baseball were #7 and #10 in the list of most commonly stolen passwords);<br /> &nbsp;</li> <li>Are significantly different from previous passwords; and<br /> &nbsp;</li> <li>Are different from passwords used on other websites.</li> </ul> <p>Also, don't use your email to store documents containing sensitive information, such as your social security number or credit card number. If you need to exchange such documents, do so through the encrypted online portal of your financial institution. You'll know it's encrypted when the URL bar shows a &quot;HTTPS.&quot;</p> <p>Finally, learn to identify the meanings of the potential types of padlocks that your web browser uses, such as the <a href="https://support.mozilla.org/en-US/kb/how-do-i-tell-if-my-connection-is-secure">green and gray padlocks of Mozilla Firefox</a>.</p> <p>Better safe than sorry.</p> <p><em>Have you ever been a victim of identity theft?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/3-sneaky-ways-identity-thieves-can-access-your-data">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-surprising-perks-and-some-drawbacks-of-paperless-billing">9 Surprising Perks (and Some Drawbacks) of Paperless Billing</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-is-your-auto-reply-email-telling-people-about-you">What Is Your Auto-Reply Email Telling People About You?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/stop-making-these-8-risky-password-mistakes">Stop Making These 8 Risky Password Mistakes</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-to-keep-your-private-info-private">10 Ways to Keep Your Private Info Private</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/phishing-scams-continue-to-plague-social-media-sites">Phishing Scams Continue to Plague Social Media Sites</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> General Tips Technology bank statements email free wi-fi identity theft Internet loan applications mail theft passwords protection scams security Thu, 01 Sep 2016 09:00:05 +0000 Damian Davila 1780042 at http://www.wisebread.com How to Find a Legit Virtual Assistant Job http://www.wisebread.com/how-to-find-a-legit-virtual-assistant-job <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-find-a-legit-virtual-assistant-job" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_virtual_assistant_45281194.jpg" alt="Woman finding a legit virtual assistant job" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Working as a virtual assistant sounds like a dream job. As a remote administrator, serving as a virtual assistant allows you to work from home in your pajamas when it suits your schedule. You get to do more varied work than an at-home customer service representative &mdash; you might manage social media accounts, book travel arrangements, create PowerPoint presentations, or take minutes during online meetings.</p> <p>Moreover, good virtual assistants can make an excellent wage from their homes. Because of how appealing this gig sounds, virtual assistant job listings are rife with scams and fraudulent listings.</p> <p>While some executives will hire virtual assistants on their own, most workers find clients through virtual assistant companies that connect business owners with contractors. The industry is expanding rapidly, and discerning the scams from the real companies is becoming increasingly difficult.</p> <p>Here are some tips to help you find out if a company is a legitimate business.</p> <h2>Check out the Better Business Bureau</h2> <p>While the virtual assistant company&rsquo;s page on the Better Business Bureau site may not be comprehensive, if they do have a presence on the page, that is a good indication that the business is a serious enterprise.</p> <h2>Review Their Website</h2> <p>If the page is littered with typos or broken links, that is a definite sign that the company is not legitimate. Also, pay attention to the company&rsquo;s contact information; if they list a phone number or email address, reach out to them and see if they work.</p> <h2>Do a Google Search</h2> <p>If a company is the real deal, a Google search will reveal other companies who use them, LinkedIn connections, and business profiles. If they are not reputable, you may find people complaining about them on social media or sites like <a href="http://www.ripoffreport.com">Ripoff Report</a>.</p> <h2>Visit GlassDoor</h2> <p><a href="http://www.glassdoor.com">GlassDoor</a> can be a great resource to see what current and past employees experienced at the company. They will share their experiences &mdash; both the good and bad &mdash; such as what to expect regarding salary, working conditions, and whether they got paid.</p> <h2>Understand the Interview Process</h2> <p>Scam gigs will hire just about anyone without much screening, so if you send in a resume and are immediately hired, that is a major red flag.</p> <h2>What to Expect From a Legitimate Company</h2> <p>As a virtual assistant, you will be closely working alongside executives and be privy to sensitive information. Real companies want to make sure you are a person of integrity and have the talent to do the job efficiently to maintain their reputation.</p> <p>A legitimate virtual assistant company is extremely thorough. You will likely have to submit a resume and cover letter, and then undergo an initial phone screening. From there, many companies will have you complete various tests and evaluations to test your speed, accuracy, and professionalism. It is not uncommon to go through second or even third interviews, usually through Skype or GoToMeeting. The entire process can take as long as two months.</p> <p>While the long interview duration can be time consuming, it is a good sign they are doing their due diligence and are an upstanding company.</p> <h2>Where to Find Real Virtual Assistant Jobs</h2> <p>There are a number of virtual assistant firms that are well-known and respected, who hold their virtual assistants to high standards, and pay them decent wages:</p> <ul> <li><a href="http://www.eahelp.com">eaHelp</a>: Virtual assistants mainly work with entrepreneurs, celebrities, and pastors. The pay ranges from $12&ndash;$18 an hour.<br /> &nbsp;</li> <li><a href="http://www.timeetc.com">Time Etc</a>: With Time Etc, you will do everything from book a family&rsquo;s vacation to write blog posts. Pay is usually around $11 an hour.<br /> &nbsp;</li> <li><a href="http://www.zirtual.com">Zirtual</a>: Unlike other companies, Zirtual assistants are full-time employees. While the pay is about $11 an hour, you are eligible for medical and dental benefits.<br /> &nbsp;</li> <li><a href="http://www.fancyhands.com">Fancy Hands</a>: While Fancy Hands is a real company, its structure is very different. They pay per task, with each task paying as little as $2 to $7.<br /> &nbsp;</li> <li><a href="https://www.99dollarsocial.com/content-specialist-position/">99 Dollar Social</a>: Unlike other virtual assistant positions, 99 Dollar Social&rsquo;s representatives solely update social media accounts for clients. The pay is approximately $12 an hour.</li> </ul> <p>For many people, getting a job as a virtual assistant is a great way to earn extra income or even transition to working full-time from home. However, because these roles are so attractive, you need be aware of how many scams there are that will try to steal from you. Carefully research potential employers and check out the established and reputable companies to make sure you get paid for the work you do.</p> <p><em>Have you worked as a VA? Tell us about it in comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kat-tretina">Kat Tretina</a> of <a href="http://www.wisebread.com/how-to-find-a-legit-virtual-assistant-job">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/22-websites-that-will-pay-you-to-write-for-them">22 Websites That Will Pay You to Write for Them</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-terrible-work-from-home-jobs-you-should-avoid">8 Terrible Work-From-Home &quot;Jobs&quot; You Should Avoid</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-paid-real-money-from-virtual-work">Get Paid Real Money From Virtual Work</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-make-money-as-a-chat-or-forum-moderator">How to Make Money as a Chat or Forum Moderator</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-tell-if-that-home-business-opportunity-is-really-a-pyramid-scheme">How to Tell if That Home Business Opportunity Is Really a Pyramid Scheme</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Job Hunting flexible schedules job listings scams telecommute virtual assistants work from home Mon, 18 Jul 2016 10:00:18 +0000 Kat Tretina 1753208 at http://www.wisebread.com What to Do When You Suspect a Scam http://www.wisebread.com/what-to-do-when-you-suspect-a-scam <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-to-do-when-you-suspect-a-scam" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_using_phone_39165382.jpg" alt="Man reacting when he suspects a financial scam" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Within days of filing my taxes this year, I started getting suspicious phone calls. Apparently, the IRS was suing me and I had to pay a &quot;settlement&quot; amount, or I would be hearing from lawyers pursuing a much greater amount of money.</p> <p>Fortunately for me, my husband works in the financial industry and knows <a href="http://www.wisebread.com/6-things-the-irs-doesnt-want-you-to-know-about-them" target="_blank">how the IRS works</a> &mdash; they always send a letter first. Since I knew from the outset that the call was a scam, it was actually kind of funny to be on the receiving end of one of these calls that I'd heard so much about.</p> <p>But for many, many people &mdash; up to one in 10 in <a href="http://www.telegraph.co.uk/finance/personalfinance/9401927/One-in-ten-people-fall-victim-to-scams-investigation-finds.html">the general population</a>, and one in five in <a href="http://www.wsj.com/articles/SB10001424052702303330204579248292834035108">the over-65 demographic</a> &mdash; these calls aren't funny at all. They are terrifying, and people will spend whatever they have to in order to keep the supposed IRS off their backs. And this IRS scam isn't the only one!! In fact, there are several common phone scams that take financial advantage of people who simply don't know any better.</p> <p>Wondering how to spot one of these scams, both in the calls you get and in the lives of those you care about? Here are some ideas.</p> <h2>Government Agencies Won't Call You Out of The Blue</h2> <p>Most government agencies will <a href="https://www.irs.gov/uac/newsroom/scam-phone-calls-continue-irs-identifies-five-easy-ways-to-spot-suspicious-calls">contact you first by mail</a>, even if they think you owe them quite a bit of money. So if someone calls and claims to be from the IRS, FBI, local law enforcement, jury duty enforcement, or any other government agency, you can be pretty sure that they are scamming you. This is especially true if they are asking you for money, for you Social Security Number, or anything else like that.</p> <p>If you're unsure as to the legitimacy of the call, tell the scammer that you are driving and cannot pay right now, but you'd like to call back as soon as you've stopped. Get as much information as you can, like the name and the official title of the person calling you, and the name of the department they claim to be representing. Then, when you're off the line, do some research. Find a phone number or email address for the department and call them directly. Explain the call you received and that you aren't sure it was legitimate, and let them help you figure it out.</p> <p>These calls can be especially harmful to people who feel vulnerable or afraid, like many elderly people, people living alone, etc. If you know or love someone in one of these categories, make sure they know that these calls can be fake. Offer to back them up if they ever need it, and remind them that they have rights, too.</p> <h2>Cold Calls From Charities</h2> <p>Did you ever get a call out of nowhere from a charity, cause, or campaign asking for an immediate donation? These can be among the most confusing calls to receive, because some non-profits use this as a legitimate marketing technique.</p> <p>If you aren't sure that the call is legit but you're interested in a cause, explain that you are uncomfortable giving out financial information over the phone. Get the exact name of the organization and Google it. See if you can find any reviews of the organization. Then, donate online or call the number provided on the website to make your donation.</p> <p>Also, don't share personal information, like your Social Security Number, over the phone. It is perfectly acceptable to simply say that you don't give out that data that way. If they pressure you, they either aren't legitimate or they might not be an organization you'd want to donate to anyway.</p> <h2>Computer Support Scams</h2> <p>If anyone ever calls you out of the blue and <a href="http://www.consumerreports.org/consumer-protection/how-to-identify-a-phone-scam/">asks you to install</a> something on your computer, run away. The programs they have you install will mine your personal data and collect things like usernames and passwords, which the scammer can then use to steal your identity and your money.</p> <p>Instead of following the directions a cold-calling supposed computer tech gives you, you can either tell them that you're not worried about your machine or you can thank them for their information and tell them you'll have someone look at the machine in person (and you can actually do this, if you're concerned).</p> <h2>If You Get Scammed, Act Fast</h2> <p>If you get scammed, take a deep breath. There are still some things you can do to give yourself the best chance of recovery. First, create an <a href="https://www.ftccomplaintassistant.gov/">identity theft report</a> through the Federal Trade Commission. This might not get you your money back immediately, but it will help them follow up on and catch scammers.</p> <p>Next, place a fraud alert on your credit report with one of the three credit reporting agencies (<a href="http://www.experian.com">Experian</a>, <a href="http://www.transunion.com">TransUnion</a>, and <a href="http://www.equifax.com">Equifax</a>). This automatically causes all three agencies to tell potential creditors to take extra steps to confirm your identity before opening any sort of line of credit, which can stop scammers in their tracks.</p> <p>If you think your Social Security number might be compromised, contact <a href="https://faq.ssa.gov/link/portal/34011/34019/Article/3792/What-should-I-do-if-I-think-someone-is-using-my-Social-Security-number">Social Security</a> and the <a href="https://www.irs.gov/uac/taxpayer-guide-to-identity-theft">Internal Revenue Service</a>. They will help you take steps to ensure your number is not used fraudulently.</p> <p>Even if you don't get scammed, report potential scam calls to the FTC. This helps them track and stop scammers before they hurt someone else.</p> <h2>Helping Potential Scam Victims You May Know</h2> <p>Maybe you feel confident that you could avoid being scammed, but you're concerned for elderly relatives or other people you know. Start by having a conversation about the types of scams that are out there and the impact they could have. If you are in a place to do so, set up a system for a loved one where you or another close friend or family member can verify the legitimacy of an organization before the vulnerable person donates. Having this in place ahead of time can help stop the scam before it starts.</p> <p>If you can't have that conversation or you're not sure how well the other person took it, keep your ears open. Many scams play on fear and anxiety, and people who have given into that often talk about it. If someone mentions owing money to the IRS or another government agency, ask some more questions.</p> <p>Similarly, listen for discussions about donating money, prepaying funeral expenses, and more. Even if your loved one has already been scammed, keeping your ears open can help you nip the problem in the bud before it destroys their financial future.</p> <p>If you have a loved one who has been scammed in the past, it might behoove you to set up some sort of joint access to their bank and credit card accounts. That way, you can monitor any money movement and spot transactions that might be fraudulent.</p> <p>You can also teach yourself and your loved ones to become scam resistant. Don't answer calls from numbers you don't recognize (if they have something to say, they can leave a message!). Google the numbers before you call them back, as there are websites that will report on whether or not the number belongs to a fraudster. Look up the numbers for the folks who call you independently, so you can check on the legitimacy of the call before you disclose any information.</p> <p>Maybe most importantly, learn to control your own feelings. Dealing with scammers is difficult because they try to manipulate emotions. Staying calm is usually more than half the battle, rather than giving in to fear, anxiety, a desire to help, and more. Train yourself to do this and help the potentially vulnerable people in your life to do the same, and you will be nearly scam resistant.</p> <p><em>Have you or a loved one been scammed? What was the scam and how did you recover?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sarah-winfrey">Sarah Winfrey</a> of <a href="http://www.wisebread.com/what-to-do-when-you-suspect-a-scam">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/beware-these-6-phony-irs-calls-and-emails">Beware These 6 Phony IRS Calls and Emails</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-credit-repair-scam">How to Spot a Credit Repair Scam</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-real-life-calamities-that-can-drain-your-finances-plus-how-to-defend-against-them">8 Real Life Calamities That Can Drain Your Finances (Plus How to Defend Against Them)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-charity-scam-from-a-mile-away">How to Spot a Charity Scam From a Mile Away</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-not-buy-a-digital-camera-online-until-you-read-this">DO NOT buy a digital camera online until you read this.</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance crime elderly fake calls federal trade commission financial abuse fraud IRS scams theft Tue, 12 Jul 2016 10:00:14 +0000 Sarah Winfrey 1749903 at http://www.wisebread.com 5 Things You Need to Know When Renting-to-Own a Home http://www.wisebread.com/5-things-you-need-to-know-when-renting-to-own-a-home <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-things-you-need-to-know-when-renting-to-own-a-home" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/house_hand_coins_88170549_0.jpg" alt="What you need to know about renting-to-own a home" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Your credit scores are too low. Or maybe you've run up too much credit card debt. Whatever the reason, you can't qualify for the mortgage loan you need to buy a home. But there is hope: You can enter into a rent-to-own agreement and begin living in a home today &mdash; one that you might eventually be able to buy.</p> <p>Just be careful: David Reiss, professor of law and research director for the Center for Urban Business at Brooklyn Law School, said that consumers need to be careful when entering rent-to-own arrangements. Often, these agreements end up with tenants losing money that they didn't need to spend.</p> <p>&quot;Potential homebuyers should be very careful with rent-to-own opportunities,&quot; Reiss said. &quot;They have a long history of burning buyers. Does the law in your state provide any protection to a rent-to-own buyer who falls behind on payments? Could you end up losing everything that you had paid toward the purchase if you lose your job?&quot;</p> <p>These worries, and others, are why you need to do your research before signing a rent-to-own agreement. And it's why you need to know these five key facts before agreeing to any rent-to-own contract.</p> <h2>1. How Do Monthly Rent and Final Selling Price Relate?</h2> <p>In a rent-to-own arrangement, you might pay a bit more in rent each month to the <a href="http://www.wisebread.com/5-reasons-you-shouldnt-buy-a-house-yet" target="_blank">owner of a home</a>. These extra dollars go toward reducing a final sales price for the home that you and the owner agree upon before you start renting.</p> <p>Then, after a set number of years pass &mdash; usually anywhere from one to five &mdash; you'll have the option to purchase the home, with the sales price lowered by however much extra money you paid along with your monthly rent checks. Not all companies that offer rent-to-own homes work this way. Some don't ask for more money from tenants each month, and don't apply any rental money toward lowering the eventual sales price of the home.</p> <p>This latter option might be the better choice for you if you're not certain that you'll be able to qualify for a mortgage even after the rental period ends.</p> <p>&quot;A pitfall is if the tenant buyer signs into the program but will never be approved for financing, thus never purchases the house,&quot; said John Matthews, president of operations of Chicago Lease to Own. &quot;That is how the scammers out there have used rent-to-own to hurt people. They sell it to those who should never have been in the program and take their portion of the rent every month used 'for the purchase of their home' knowing that the tenant will never qualify to buy the home.&quot;</p> <p>Make sure you know &mdash; and are comfortable with &mdash; the home's final sales price and monthly rent payments before you agree to a rent-to-own arrangement. And if you don&rsquo;t want to pay extra in rent each month for a home that you might never end up buying? A rent-to-own agreement might not be for you.</p> <h2>2. What Is the Timeline?</h2> <p>To start the rent-to-own process, you and the owner of a home sign a contract listing what the home's final sales price will be after the rental period ends. The contract will also list how long you will rent the home before you have to decide whether to buy the property. The document will state, too, how much you'll pay in rent each month, and how much of that money will go toward lowering the home's final sales price.</p> <p>These are all key facts to learn before you rent-to-own. You don't want too little of your monthly rent going toward a home's final sales price. If it does, you'll barely make a dent in that final sales price.</p> <h2>3. What's an &quot;Option Premium&quot;</h2> <p>After you and the homeowner sign the contract, you'll pay what is known as an option premium. This premium is what gives you the right to purchase the home after the rental period ends. Be aware that this premium is nonrefundable, even if you don't decide to buy the house after your rental period comes to a close. You can expect to pay about 5% of the home's final sales price for your option premium.</p> <h2>4. What Happens to Your Extra Money If You Don't Buy?</h2> <p>If you don't end up buying the home after the rent-to-own period ends, you'll most likely lose the extra money that you paid each month to your landlord. Most landlords will include a provision in their rent-to-own contracts stating that tenants lose the extra rent they send in every month if they pass on their option of purchasing the home.</p> <p>If you're not certain that you will end up buying the home &mdash; and after five years or so of renting a home you might decide that the property or neighborhood is not the right one for you &mdash; be wary of entering a rent-to-own arrangement. You might be throwing away all those extra dollars each month.</p> <h2>5. How Strong Is the Local Real Estate Market?</h2> <p>It pays, too, to study the market in which your rent-to-own home sits. Are housing prices rising in value each year? Or is the market a sluggish one? This is important information to know. What if the home in which you are living loses value during the five years you are renting it? Will you still want to pay that higher final sales price that you negotiated with your landlord?</p> <p>If you signed a contract, you won't have any recourse but to pay more than what the home is worth or to walk away from the deal, meaning that you threw away all that extra rental money you sent your landlord every month.</p> <p>Renters need to be careful, too, when negotiating a home's future sales price. A landlord might ask for a price that is unrealistically high for a specific market.</p> <p>&quot;The landlord will greatly inflate the purchase price of the home when the tenant can buy it,&quot; said Mark Ferguson, founder of Invest Four More in Greeley, Colorado. &quot;The home may be worth $120,000 today, but in a year or two, the price for the tenant will be $140,000 or more. The landlord will justify this because prices always go up. Landlords won't tell you that the average appreciation of homes is 3% to 6% a year, and their price is 20% or 30% higher a year.&quot;</p> <p>It pays to meet with a real estate agent or to study the local housing market on your own. You can never guarantee that a home won't fall in value, but by doing your homework, you can at least increase your odds of renting a property that has a chance to increase in value during the rental period.</p> <p><em>Have you bought a home via rent-to-own? What was the process like for you?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-things-you-need-to-know-when-renting-to-own-a-home">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-to-buy-a-house-without-a-mortgage">4 Ways to Buy a House Without a Mortgage</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-a-first-time-home-buyer-needs-to-buy-a-house">Everything a First-Time Home Buyer Needs to Buy a House</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-surprising-ways-real-estate-cuts-your-taxes">10 Surprising Ways Real Estate Cuts Your Taxes</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ask-yourself-these-5-questions-before-buying-a-home">Ask Yourself These 5 Questions Before Buying a Home</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-a-30-year-mortgage-is-a-smart-financial-choice">Here&#039;s Why a 30-Year Mortgage Is a Smart Financial Choice</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing financing housing market landlords mortgages new homeowners rent to own scams Tue, 12 Jul 2016 09:00:09 +0000 Dan Rafter 1741716 at http://www.wisebread.com 5 Reasons to Stay Away From Penny Stocks http://www.wisebread.com/5-reasons-to-stay-away-from-penny-stocks <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-to-stay-away-from-penny-stocks" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/penny_stock_investment_407668.jpg" alt="Learning reasons to stay away from penny stocks" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Penny stocks are inexpensive equities trading for as little as pennies per share. Because they do not meet rigorous financial reporting requirements, you won't find these stocks listed on the NYSE or NASDAQ. Instead, they're traded on the over-the-counter market rather than the stock exchanges where more reputable stocks are found. You've probably heard stories about people getting rich from penny stocks, but consider these reasons to stay away. (See also:&nbsp;<a href="http://www.wisebread.com/are-you-making-the-biggest-investment-risk-of-all" target="_blank">Are You Making the Biggest Investment Risk of All?</a>)</p> <h2>1. You Don't Know What You Are Buying</h2> <p>When I look at buying something that is really cheap, my first question is, &quot;Why is that so inexpensive?&quot; Most penny stock is in companies with few or no assets. It's also hard to know what you are getting, since the financial reporting requirements are less rigorous than for other stocks. Without audited financial reports, it is easy to be misled as an investor and buy stock in a company that is basically worthless.</p> <h2>2. Penny Stocks Can Be Difficult to Sell</h2> <p>A big consideration for any investment is your exit strategy &mdash; how will you get your cash out? Since penny stocks are not traded on stock exchanges, it can be difficult to find a buyer when you want to sell. There are just not that many investors looking for stock in companies with low asset value and less than standard financial documentation.</p> <h2>3. Penny Stock Scams and Fraud</h2> <p>Penny stocks are often associated with scams and &quot;pump and dump&quot; schemes. Some penny stock investors will buy lots of shares of worthless stock, promote it through mass email as the next &quot;hot stock,&quot; and then sell it when the stock price peaks. The stock price then goes back down and everyone who thought they were buying a hot stock is left with a loss and a stock that is hard to sell.</p> <h2>4. Like Day Trading, But Worse</h2> <p>Many people who invest in penny stocks are not investing based on the value of the business, but are trying to make money from the volatility of penny stocks &mdash; buying a stock when the price is moving up, and selling it within a few days before the price goes back down. But you know that trying to time the market is always risky. Doing this with penny stocks is even riskier than with other assets, since limited financial information is available.</p> <h2>5. You Will Likely Lose Money</h2> <p>Since penny stock companies have low asset value, there is significant risk that the company could go bankrupt and leave you with worthless stock. A buy and hold strategy for penny stocks may leave you with zero value instead of growth in the stock price. Even if you don't plan to hold a penny stock for long, you are most likely to notice a penny stock while it is &quot;hot,&quot; meaning you are buying near the peak price and will probably lose money by the time you can sell it.</p> <p><em>Have you ever been burned playing with penny stocks?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dr-penny-pincher">Dr Penny Pincher</a> of <a href="http://www.wisebread.com/5-reasons-to-stay-away-from-penny-stocks">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-loss-aversion-is-costing-you-more-than-your-fomo">Your Loss Aversion Is Costing You More Than Your FOMO</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-yourself-from-an-investment-scam">How to Protect Yourself From an Investment Scam</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/womanhood-microscopic-and-other-hot-stock-tips">Womanhood microscopic and other hot stock tips</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-we-headed-toward-a-bull-or-bear-market">Are We Headed Toward a Bull or Bear Market?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/learn-how-to-invest-with-these-5-stock-market-games">Learn How to Invest With These 5 Stock Market Games</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment day trading fraud losing money over the counter penny stocks scams stock market Mon, 04 Jul 2016 10:00:04 +0000 Dr Penny Pincher 1743167 at http://www.wisebread.com