Goodbye 2008, Hello 2009

Well chickadees, it's almost time to bid 2008 adieu. I don't know how most of you will look back on the year, as choruses of "Auld Lang Syne" waft from many a pub, street and living room after the ball drops on Wednesday night, but for me the year definitely had its ups and downs.

Ups: Getting a fabulous raise, visiting family more often, celebrating one-year wedding anniversary, making some marvelous friends, starting this blog, all the uber cute clothes I've added to my wardrobe.

Downs: Living in Washington DC, grandfather passing away, lack of funds to go traveling with, not seeing Love much as law school has become "the other woman" in our relationship (haha), the cost of all the uber cute clothes I've added to my wardrobe.

You get the point. I've yet to whittle my list of 2009 resolutions down to one or two that somewhat resemble realistic goals. (Something tells me "convert living room into giant home theater replete with DVD projector" or "take roadtrip down to Argentina in late-60s model VW bus" are either too expensive or too Hunter S. Thompson-esque, respectively ... at least at this point in my life.) Sigh. I guess there's solace in knowing that a money resolution is always good fallback fodder for those looking to be more financially fit. And I have a feeling that many of you probably feel the same way.

So what do you want out of 2009? A larger emergency fund? Paying down (hopefully!) most of your debt? Sharing your fiscal mistakes to educate those you care about? Personal finance expert Dara Duguay, director of Citigroup’s Office of Financial Education, recently shared five excellent money resolutions that many of us could adopt to help get our finances in order for 2009. If you're more of an a la carte gal like me, pick and sample which of the following may be the best for you to work on in the coming year:

Don’t treat money as a taboo subject. Whether managing finances yourself or with a spouse/partner, avoiding money issues in the hopes that they will just go away or until you have a financial crisis only guarantees stress and arguments. Set aside time every month – or schedule regular monthly “money meetings” with your partner – to review the bills, progress toward your money goals, investment portfolio, college savings and any other money topic that is relevant. This monthly review could coincide with bill paying or when your bank statement arrives.

Create an emergency fund. Emergency savings are, in effect, a form of insurance. It will protect you from life’s curveballs catapulting you into a financial crisis. So open a savings account and don’t stop contributing until you have saved enough to cover at least three months of monthly expenses. If you can save six months worth, even better. This will prevent you from having to take cash advances, which while helpful in emergencies, come with fees and interest rate charges that are usually higher than your credit card purchases. Use cash advances with discretion, and don’t use them to fill gaps in your income or savings. Having an emergency fund will give you peace of mind.

Pay more than the minimum on your credit cards whenever you can. Even a small amount more than the minimum can make a big difference in the time it takes to pay off your balance and the total cost of interest. Also, be sure to make your monthly payments on time, every time. Even one late or missed payment can be recorded in your credit report and affect your credit history.

Contribute the maximum to a retirement savings plan. Approximately 50% of Americans who have the opportunity to contribute to a company retirement plan, choose not to. In many cases, contributions are matched by the company. This is free money that is being thrown away by opting out. Remember that your contributions will reduce your taxable income and will only be taxed when you start to withdraw them at retirement age.

Make sure you have adequate insurance protection. There is nothing like an emergency to wipe out your savings or add to your debt level. Protect yourself financially from as many emergencies as possible by ensuring adequate insurance for health, life, auto and home. Confronting these issues can be difficult since no one likes to think about possible illness or death, but to assume you are invincible from “life events” or tragedy is to not be realistic about life.

Here's to a great 2009, filled with good health, substantial wealth (fingers crossed) and renewed prosperity! To quote Oprah (one of my idols), "Cheers to a New Year and another chance for us to get it right."

Achieve your financial goals

It’s no secret that women – an important segment of the financial marketplace – face different financial realities than those of men. In fact, the vast majority of today’s women, as well as the next generation of women, will be responsible for their own and their family’s finances at some point in time.

Women & Co., a division of Citigroup, recently published a study that found 63% of women today currently serve as the “Chief Financial Officer” of their households. Impressive! Of those women, 75% believe that in the future, their daughters will be the CFO of their own households. (Can I get a collective "awww"?)

When it comes to all things women and money, Women & Co. CEO Lisa Caputo and CFA Linda Descano invariably know their stuff. According to them, in times like these it’s essential to tune out "the noise," stay focused and empower yourself with the knowledge and resources you need for long-term financial well-being:

Here are their top tips:

• Assess your financial situation. Every woman’s financial situation is as unique as she is. It’s important to talk with someone who understands your personal situation – your goals, time frame, and risk tolerance. First, make sure you have a financial support network in place – they recommend an attorney, accountant, and a financial advisor. Unfortunately us normal people usually don't have the access or funds to hire this small army of expert financial advice. If that's the case, ask your family and friends for recommendations. Women & Co. found that 72% of women are using a financial advisor for information, guidance, or a second opinion. Remember – there is no single answer that will work for everyone. Find a plan and support network that works for you.

• Plan for ‘time-out’ periods. Many women take time out from the workforce to care for children, aging parents, or spouses. Often, these time-outs result in reduced retirement savings and Social Security benefits. Meanwhile, with the average life expectancy for women being 80.4 years and that of men being 75.2 years, 90% of women find themselves outliving their spouse. Women can prepare for the unexpected by maintaining appropriate insurance coverage, and keeping their will, beneficiary designations, and other legal documents up to date. Start saving early, save more, and of course, plan carefully!

• Be a role model. Women & Co.'s study found that 85% of women feel they would have been better off if they had known more about finances and investing earlier in life. Make sure your daughters and granddaughters get an early start by talking to them about money and saving now! According to the study, 94% of women today are talking to their daughters about money compared with 52% who discussed money with their own mothers. Money is the #1 topic of discussion between mothers and daughters today, more than drinking, drugs, sex, and politics. Join the conversation! 92% of today’s women believe they are positive financial role models for their own daughters. Help raise a more financially educated, powerful, confident generation of women by talking to them about money issues early on.

• Stay informed. It's no surprise that information is an important component of financial security. As circumstances change, we need to re-educate ourselves based on whatever new realities we face, in order to make informed financial decisions. The study found that the top 3 most important resources for women are: a financial advisor, a spouse or partner, and research. Women also reported in that study that hard work and discipline are more important than education and luck when it came to financial success. Continue to seek out trusted sources of information that will provide guidance and tools, as well as the ongoing support you need to work toward your long-term financial goals.

• Clarify your financial goals. Assess where you are now financially by reviewing your net worth, credit score and cash flow. Ask yourself, “Where do I want to be in 1 year, 5 years, or even 20 years?” (Ed note: For more on setting up your budget, read my post on it here.) Work toward your financial goals, including retirement, by reviewing your finances at least once a year and making sure your savings and investment strategies are aligned with your goals.

It's (not) beginning to look a lot like Christmas

Everyone in the blogosphere (especially the personal finance blogosphere) seems to have a post by now dedicated to Christmas shopping and how to harness fabulous deals. I usually love money-saving tips -- bring them on!

Lately, though, I'm tired of scanning these gift-giving pointers -- perhaps because most are inanely obvious and repetitive in nature. Yes, I know that if I make the presents myself I can save more money, or if I shop deals online versus in-store or wait to give gifts a day after Christmas, I can save big. Sigh. I think there's a bigger picture issue that's apparent this year aside from finding the cheapest Wii or flat-screen TV. Maybe it's that so many of us are unemployed this year, or maybe it's that those of us who still have jobs are struggling financially, but to paraphrase Love from the other day, "It just doesn't really feel like Christmas this year."

This sentiment truly hit me when I stood en masse on a crowded escalator yesterday, nothing but a small pin prick on a nameless mall map, peering over the revolving handrail at the mall Santa below (spitting image of the real thing, by the way). I felt ... numb ... and had an epiphany. Had I become a modern-day Ebeneezer Scrooge?

Yes, it's 2008 and times are tough, maybe not as tough as a Dickens novel, but the joie de vivre that usually encircles mall Santas and excessive amounts of eggnog thus far is completely lost on me. This holiday season, I've felt an encroaching sense of acerbity about the whole affair, and if you can believe it, it's not the "gift giving" aspect that bothers me. After all, it's usually what conjures up a bitter tang on most people's palettes.

I'm not exactly sure why this year feels so different, but my guess is that for many there isn't that much to be cheerful about. It's one thing to read daily statistics about those who have been laid off across the country or have lost homes, but it's quite another to be able to count those close to you who barely have enough money to pay their cell phone bills.

The fear and uncertainty in the air is palpable. Many are hanging on by a frayed thread, thankful just to get by these days, much less to replicate a Normal Rockwell painting set around a cozy Christmas tree buttressed by piles of beautifully wrapped presents.

In recent years past, those that struggled were in the minority. Since the early '90s, the United States has seen enormous gains based on mortgage-backed securities -- our finances expanded by people packaging and selling them to other countries. Now, there's a fear that all those gains we've built in that last 20 years will simply vanish. The giant strides in growth we've seen are crumbling as I lament about the very problem, and just when we think we've hit a bottom, that things have to bounce back, they in fact get worse.

And forget it only affecting the finance sector. Sure, hedge fund managers, investment bankers and the Gordon Gekkos of the world may have had their 15 minutes of fame nancing down Wall Street in private towncars and Armani suits, but they're just the first domino to topple the rest in this scheme. Now thousands, in all sectors, are feeling the heat. Tourism, hotels, automobiles, manufacturing, education, anything related to real estate (including construction), leisure, restaurants, marketing/PR firms, publishing. There isn't one entity that hasn't been touched on one level or another by the crash of dominoes as they continue to fall across the country.

Sure, we'll eventually pick up the pieces as a nation and begin back where we started, before we enjoyed and expected lives based on unrealistic illusions. But the reality is oppressive and heavy, and it's unsettling that we're on the precipice of a possible deflationary cycle -- that all the money many have put into homes as equity will disappear, and that just when we think things will turn around, they don't.

I guess it's the Scrooge in me that's unable to accept this holiday season. Surprisingly,
this motivates me more to buy gifts for all the people I care about. In the past I always bought more for myself than others. I know, it's selfish, and while I did buy people things, it was always a one-for-them,-three-for-me scenario. "Christmas isn't about giving gifts, that's so materialistic," I would pontificate between episodes of Sex and the City. Riiiiiiight. . .

Now that I've found myself in a better financial position than most, it makes me happy to be able to brighten someone's day with a present that they wouldn't (or couldn't) otherwise buy. In fact, I get ten times more happiness doing this than buying anything for myself. I guess that's what it takes to find the true spirit of the holiday season. Yes, it's about giving -- within your means, of course -- and making others happy, even if you can't give a lot. Cheesy? Maybe. But it's interesting that it takes a collapse of fantastic extremes to be able to truly evaluate the state of things and cut away all the muck and static that usually blinds so many of us at the end of every year.

Wake up and smell the economy

"It's the end of the world as we know it," or so sang R.E.M. back in the heyday of the '90s -- pre-tech boom, credit crisis and the Pussycat Dolls. While Americans bought their first computers, CDs were still the way to buy music (iTunes, what iTunes?), and the ubiquitous Freddie Prinze Jr. was everywhere, was R.E.M. onto something with their prophetic lyrics?

Yes they were, according to a new paper soon to be published by Robert Seaberg, head of the wealth planning group at Citi Global Wealth Management, who hypothesizes that very few people believed the current financial disaster could actually happen.

In a recent New York Times article, Seaberg is quoted as saying that the rich were fixated in recent years on the great wealth-generating possibilities of concentrated stock positions; derivatives created from the very mortgages that, it turns out, others couldn’t pay; and hedge funds that locked up their money to take huge bets on the economy. The collapse of the housing, employment and financial markets, coming at once, was more than a shock to the system. Like so many others, many of the rich have gone back to the drawing board.

Seaberg’s new paper, entitled “A Flock of Black Swans,” (haha) says various advisers failed to impress on their clients the need to consider the possibility that highly unlikely events — so-called “black swans” — might indeed occur. The rich may not have done anything different, but at least they would have been aware of the risks they faced.

Seaberg's point is that because everyone was riding high, they didn't have to worry about "the basics," such as saving and budgeting, and instead had fun playing with high and ultra-high net worth. Although many of us know this is one of the reasons that led to the current fiscal crisis, it's always nice to get some affirmation from a legitimate economic source -- especially when that affirmation involves "the basics," which this blog knows and loves!

According to the Times, Seaberg has singled out four areas where investments were hit hardest and where they should be adjusted to ride out any future economic storms. Even though his points directly apply to those at the top of the wealth pyramid, I think people of all sized pocketbooks could learn from his tips:

Redefine a safe investment. Until this year, safe investments included U.S. Treasuries and bonds. Even though Treasuries are still safe per se, they aren't the greatests of investments right now because the yields (or money you earn back for making the investment) is almost nil. Translation: You could become that oft-posed cliche and stuff your money under mattress -- you'd get the same results.

Investment-grade corporate bonds, Seaberg tells the Times, are still trading but their yields are down, hit by the Lehman Brothers bankruptcy and AIG's struggles. Basically, this all means that the definition of a "safe investment" has become very narrow, mainly Treasuries.

Diversify more broadly. (Ed. note: If you're not sure what diversification means, read my post about it here.) Investments have increasingly shifted from just stocks to real estate, hedge funds and private equity, so-called alternative assets with higher returns for those willing to lock up their money for long periods of time. Seaberg says the problem is that many of these investments depend on borrowing, which means their values have plummeted as credit conditions tightened.

He says that in order to diversify your investments, you should look outside the U.S. and Europe to emerging and frontier markets, such as India or China. (These countries, global crisis aside, have begun to spend massive amounts on their infrastructure, so industrial companies benefit.)

Consider tax consequences. When the value of every investment was increasing, the portion lost to taxes on every gain wasn't a big deal. Gains far outstripped the tax elemtn. This isn’t the case anymore, Seaberg says. In an environment of lower returns, the after-tax piece is going to matter more. He points out that municipal bonds from cities and states that can meet their obligations are one lower-tax alternative.

Be more realistic on housing. Seaberg says that the era of the house as a constantly appreciating asset is over. In the last two years, the average house in America has dropped 20% in value, according to the Case-Shiller Home Price Index. This means people are going to be staying in homes longer, or will hold on to them longer as investments, versus selling property fast to make a quick buck. Seaberg says that should be a signal for homeowners to make sure they have the right insurance, i.e., theft, fire. and natural disasters such as hurricanes, floods and earthquakes. Although I see Seaberg's point about property owners holding on to their homes longer because of decreasing values, I don't fully agree that the era of the house as a good investment really is over. I think much of that depends on where you live (homes in rural West Virgina, versus say the Bay Area, obviously aren't congruent in value.) To make a broad-based assumption that it doesn't work anymore is too generalized. As a homebuyer who hopes to build equity in a home, you need to be realistic about the current and future states of employment, location, and property values in your individual zip code.

Seaberg tells the Times that in a recent internal memo, Wells Fargo gave its private bankers a checklist of questions that they should have been asking all along. The first question was, “Are you clear with regards to what is your true appetite for risk?” It is followed further down with, “No matter what, always live below or at your means” and “Are you saving enough?” Um, why were they not asking these questions in the first place? Oh wait, that would have saved us all this financial strife in 2008! Silly me.

Fortunately, there is an upside in all of this, according to article, in that it helps people understand the need to assess their true risk tolerance. That soul-searching, done amid the possibility of lower returns in the near future, could alter spending and saving patterns over the long term. That's a great thing. “Without a sense of abundance, people are going to be more careful,” Seaberg says.

This just in: New credit card rules adopted

Legislators this morning adopted sweeping new rules for the credit card industry that will shield consumers from increases in interest rates on existing account balances (among other changes). Translation: sweet.

Although the rules don't go into effect asap (look for a July 2010 launch date), they will allow credit card companies to raise interest rates only on new credit cards and future purchases or advances, rather than on current balances. So that Michael Kors tote you charged last month? It's in the bag.

The changes mark the most sweeping clampdown on the credit card industry in decades and are aimed at protecting consumers from arbitrary hikes in interest rates or inadequate time provided to pay the bills.

For more on all things credit cards, read "My Credit Card, My Self."

[Associated Press]

Possible band-aids for your 401(k)

It's no secret that many who've counted on their 401(k) funds to kick in just as they began planning long-awaited, post-retirement trips to Acapulco have been handed bleak news: Due to the current economic climate, their accounts have dwindled to zero, or at least somewhere near the number. Translation? Not only will they have to put any retirement plans in Margaritaville on hold (just keep repeating: it's 5:00 somewhere), and -- wait for it -- they will have to continue working. You know, just to survive, much less for any lofty trip planning.

In our late 50s and early 60s, the last thing most of us want to hear is that we'll have to work another 10+ years. What's even worse? That all the scrimping and saving we endured in our resilient youth failed to amount to more than a couple movie tickets on a Saturday night in our early 60s.

Aside from pulling a Bonnie and Clyde to secure your financial future (they didn't have the most glamorous of endings, anyway), rest easy knowing that legislators know what you're going through and are currently trying to fix it with a legislative band-aid, of sorts.

There are a number of proposals being passed back and forth on Capitol Hill right now, it all comes down to which band-aid they choose:

Relaxed hardship-withdrawal rules: President-elect Barack Obama has proposed temporarily dropping the 10% penalty for hardship withdrawals from an IRA or a 401(k) for amounts up to 15% of your plan or $10,000.

Easing up on required distributions: For those age 70½ or older, Obama has proposed temporarily suspending required minimum withdrawals from traditional IRAs and 401(k)s.

An automatic IRA: Under this plan, designed by a nonpartisan group and endorsed by Obama, small businesses without 401(k)s would have to enroll workers in a payroll-deduction savings plan (you could opt out), but no matching contribution would be required.

A new national savings plan: Proponents of a government-backed retirement savings account that would guarantee an inflation-adjusted return of 3% initially got little support. But recently one of its biggest backers was asked to testify on Capitol Hill - a sign that the plan is getting serious attention. [CNN Money]

If you're a newbie to all things 401(k), read my post "The 411 on 401(k)," to learn how they work.

Beware of hidden fees

There's nothing worse than feeling swindled, especially in matters of money. One of the worst ways I can think of being ripped off -- aside from being all-out robbed (thank God I've never had to experience that) -- is to suffer the horrors of hidden fees.

You sign your name on the dotted line ... perhaps you've been uninformed, uneducated or are just plain naive, truly thinking you're paying a certain amount for a new credit card or car loan. Twelve months later, you're standing slack-jawed and in shock over an obscene bill, so confused that not even an Appletini could put you right. After that first wave of adrenalin washes through you, completely nixing the calming European facial and full-body massage you just got (hey, a girl can dream), now is the perfect time for a plan of attack going forward.

The number one cardinal sin of a girl on a budget is enduring repeated hidden fees that always seem to hide in long lists of terms and conditions or other fine print that many fail to fully read or even bother to understand. You want to save money? Now is the time to stop glossing over the fine print. As you've witnessed over the last year, the erstwhile Wall Street conglomerate may score a government bailout (if they're lucky), but no one will there to bail you out just because you didn't "think you needed to read all that." You've got take to take matters into your own hands. Don't be afraid to ask questions of anything you don't understand, and make sure to never, ever sign your name (and while you're at it, your bank account) to something that you don't fully comprehend in entirety. After all, it's your money we're talking about here.

Where do the most common hidden fees lurk? I found some great tips from Suze Orman on Oprah.com, highlighting where and what to watch for in these typical areas:

Retirement savings: Do you know how much it costs you to invest in the funds in your 401(k)? The difference between paying high and low fees can add up to tens of thousands of dollars. Call your plan provider to make sure your funds don't charge sales commissions (called a "front-end load" or "deferred-sales charge") and that the annual expense ratio is no higher than 1 percent. If your plan doesn't offer lowcost options, you and your colleagues should make a ruckus—the law is clear that 401(k)s must be operated for the employee's benefit, and high-cost funds are of no help to you. The same goes for your Roth IRA—no-load funds and low-expense ratios are the surest way to boost your bottom line. Fidelity, T. Rowe Price, and Vanguard all offer many low-cost funds.

Credit card: If your monthly payment isn't on time, you'll be slapped with a late fee as high as $39. Do that three times a year, and you've donated nearly $120 to the credit card company. Late payments also hurt your FICO score. And never, ever take out a cash advance on your credit card. The cost is often 3 percent of the amount borrowed, and the interest rate can be higher than 20 percent.

Bank account: It's easy to be hit with fees of $3 or more when you use an ATM—a charge from your own bank plus the one from which you withdraw cash. Do that twice a month, and you're spending at least $72 a year.

Recurring payments: Some bills, such as your insurance premium, allow you to choose between making one big annual payment and a series of installments. If you can afford the one-time deal, you'll avoid the $5 or so service charge levied when you pay quarterly or monthly—that's $20 to $60 a year. It's easy to save $200 annually by eliminating these types of fees. Invest that $200 a year for 20 years, earn an annualized 8% gain, and you've got nearly $10,000. It pays to be a fee fiend.

Women and money, revisited

There's a stereotype that's been perpetuated through the years and it goes a little something like this: Women are fickle and tend to spend more than their male counterparts.

Not only that, but women tend to rely on men more for financial planning -- I don't necessarily mean shacking up with a sugar daddy, but statistically we lean on the men in our lives (our fathers, husbands, etc.) to help plan our financial matters. Many of whom could have been financially savvy dolls often find themselves not peddling through the Napa vineyards with their Loves, but rather sitting across from a personal accountant after being widowed or divorced, scratching their fabulously coiffed heads and wondering how they got there. Even if your future is void of divorces or deaths (fingers crossed), if you don't save now, you could still find yourself 40 and penniless, all because you failed at coming up with a pre-game strategy, and well, figured all those lunches out with friends and errant shopping trips wouldn't really matter.

Guess what? In the long run, they do:

• At some point in our lives, 9 out of 10 women will be solely responsible for their finances.
• The average age of widowhood in the U.S. is 56.
• On average, women live 7 years longer than men.
• Women live more than 19 years in retirement.
• The median income for elderly women is $8,198.
• Women collectively earn more than $1 trillion a year.
• Nearly 70% of women say they have no idea how much money they'll need for
  retirement.
• 53% of women are more likely to spend rather than save for their future.

Ladies, let's be serious -- for many of us, shopping is not only a hobby, it's a way of life ... an addiction, if you will. But $1 trillion is a lot of potential savings. There have been many times in my life when I just think "oh, it's just one shirt . . . just one pair of heels," but all those "justs" add up to what could have been a substantive amount to retire (hopefully early!) on. You can't make a pair of killer Christian Louboutins make money for you, but when invested right, you can make killer returns off your savings.

Now I'm not advising to go cold turkey and wean yourself off the bottle completely -- every stylish woman needs a cocktail once in a while and perhaps a cute handbag ... or dress ... or, well, you get the point. But you need to set limits and know that before you buy anything, you need to pay yourself first, which means setting aside a money after you get paid (and after your Roth is paid), that you can put into an investment vehicle such as a CD.

The stats I mentioned prove that while us women are bringing home the bacon, we have no ... er, bacon ... to divy up at the end of the day. Here's why:

• We often don't set a monetary goal for where we need to be at retirement.
• We start saving and investing later in our lives and don't have as many working years as men. The average woman spends 15% of her career out of the paid workforce, aka the "sandwich generation" -- caring for children, then elderly parents.
• 76% of women are too conservative when it comes to investing, where only 64%
  of men consider themselves conservative investors. Women often pass up excellent investment opportunities because we are too afraid to take the leap.
• Just 53% of women, versus 82% of men feel confident in their investment know-how. That often stops us from making necesarry decisions, also limiting our returns.

For all us money honeys out there, this is a wake-up call to begin planning our financial futures. Don't know the first thing about investing? For a fabulous "how to" on all things investing, visit http://www.fool.com/school/basics/basics01.htm and educate yourself.

And here's a good start for now: Make a list of what you own (bank accounts, stocks and investment, real estate, retirement plans). Then figure out how much you owe (include all bills, i.e., car payments, credit cards, school loans, house payments, etc.).

Now how much money goes toward your List of Woes, I mean, Owes? It's not as easy as simply counting the big, reoccuring payments every month. What makes or breaks many woman's 10- or 20-year plan is that they don't budget for the basics. Can't live without getting your nails done? (This frugal saver would tell you do your nails yourself, but that's a different matter). Need your Starbuck's fix every morning? How much do you drive on average per month and what is that costing you in gas money? What's your monthly budget for clothes? It's these kind of dollars that hold many back from achieving their financial dreams because they aren't budgeted for in the present, therefore they quickly add up. I don't know about you, but I really want those routine trips to Italy, and I want to be able to retire early enough to enjoy them!

Unemployed with no job in sight? Here's help

If you've just gotten notice via a dandy little pink (it used to be your favorite color) slip that your services won't be needed any longer, then here's a reason why those long, depressing Dr. Zhivago-esque unemployment lines may be a nice respite from the me-and-half-of-America-has-been-laid-off storm.

How? (Aside from providing the much-needed $350/week sustenance until your career is back on track.) Well, at the end of November, Dubya put a new act in the books to lengthen the period of financial assistance that every laid off worker in the U.S. is entitled to in the current market, which (as you all know) is devoid of many job prospects.

The Unemployment Extension Act of 2008 extends benefits for the unemployed by seven weeks in all states, and extends them for another 13 weeks on top of that in states with unemployment rates that have averaged 6% or higher over the most recent three months. Yippee? According to the Bureau of Labor Statistics, those who live in a high unemployment states will receive a total of 20 more weeks and nearly half of the states fit that criteria as of October. (If you're not sure where your state stands, visit the BLS website.)

Here's the 411 on the act:

How you qualify: To be eligible, you must be unemployed through no fault of your own and be actively seeking work. Requirements vary from state to state. Generally, wages earned and time on the job determine if you qualify and the level of assistance you will receive.

For example, In Washington you need to have 680 hours of employment in your base year - which is the first 12 of the last 18 months of work. In Nevada, a person must have earned at least $400 in one quarter of the base year to get help.

What you get: States have their own formulas for determining how much you will receive and for how long, but a general rule of thumb is that you will get half of your last paycheck for 26 weeks, explained Andy Stettner, deputy director of the National Employment Law Project.

In most states that is based on what you earned over your base year - up to a certain amount. Every state sets its own maximum, based on that state's average income. The average unemployment insurance benefit is $292 a week according to the Department of Labor.

When you get it: Experts recommend filing for unemployment on your first day out of work. It generally takes two or three weeks after you file a claim to receive your first check. In most cases there is then a "waiting week," and then you will receive your first unemployment insurance check the week after that.

What impacts your benefits: If you work part-time or freelance while you are collecting unemployment that will most likely reduce or eliminate your benefits. The same is true for severance checks in some states. You could still get a partial unemployment check but the formula for determining what percentage of your benefit you could still receive differs by state.

How to get in on the extension: In most states your unemployment insurance will be automatically extended if the Unemployment Compensation Extension Act passes. But to be sure, Stettner recommends calling your unemployment office to ask what you need to do to qualify. [CNN Money]

Fashion on a Budget: New Target/Hayden-Harnett bag line

Target is gearing up to debut their 7th designer handbag collection, this time with bag designers Toni Hacker and Ben Harnett, Brooklyn natives who founded their fashion house a mere four years ago in 2005 and have risen rapidly to become trendsetters in their genre, selling to high-end boutiques worldwide. Us girls on a budget may not be able to strut into the nearest Apres Peau and plunk down $700 (sigh) for any Hayden-Harnett goodness, but now (much like we used to play dress up and pretend we were the Queen of England ... or was that just me?) we can "play" with a budget of $25 and live luxe. Well, kind of.

The Hayden-Harnett collection will be dropping it like it's hot on December 28th, so get thee to your nearest Target when the big day rolls around to examine the goods mano a mano. Hey, I know you'll be out anyway flitting in retail land on your post-Christmas mission to lap up goodies on sale ... at least I will be. The bags will range between $19.99 and $49.99 (not bad at all), and will include oversized envelope clutches, convertible hobos and flight totes. Snazzy detailing on said bags will include distressed brown or black faux-leather and a multi-color fig-leaf printed canvas. Sweet, because in the floral motif realm, hibiscus flowers are so 1997. Fig leafs are the new hibiscus.

And now for your viewing pleasure:Mary Poppins meets the The King and I, with a fig-leaf twist (above). Interesting Thai-influenced umbrella.
This brown clutch (above) also comes in black. Love the Chanel-influenced woven chain and faux-leather wristlet strap, not sure about the exposed coin pouch. It looks like it was stuck to the outside because they wanted the product to look "different." Is this a clutch, wristlet, or actual handbag? Is defining handbags already passe?Like the previous clutch, this one (above) also comes available in black. I think it's tres cute -- very 70s hippie meets urban chic. The (faux) leather looks like it actually wouldn't look that ... faux ... in person and I love the pleated detail and gold-riveted plates in the center.
I also love this handbag, but I can't decide whether I like it better in brown or black. Regardless, it reminds me of the $1,500 Balenciaga motorcycle bag that I have coveted for, oh, the past four years and will probably continue to do so for a very, very long time. If I buy either of these, I'd ake off the shoulder strap and use the shorter handles -- it'd be cuter held than carried by your shoulder.A fig-leaf -- I love saying that -- canvas version of the above bags.

Can't decide whether I love it or hate it (above). Leather and chain straps? Check. Odd, bottom-heavy silhouette replete with studs on underbelly? Not so check. Must examine in person.Yet another handbag of the fig-leaf canvas variety. Is it just me or is this print somewhat reminscient of the upholstered wicker couch cushions on the Golden Girls living room set? If it is (and I am by no means knocking it, HUGE fan of Golden Girls, I'm a Blanche!) then I must buy it! I do love the tan leather detailing on this fig-leaf throwback to set furniture in a late '80s sitcom.

Thoughts?

They want to suck your blood, er money

I've got a secret for you ... there's a vampire lurking in your home.

No, I don't mean one of those cheesy '80s vampires in "Lost Boys" (sorry, Kiefer), or any of those hormonally angst-ridden teenage vampires of the Cullen-variety a la Twilight. These vampires are even scarier because they suck money right out of your wallet when you least expect it -- and unfortunately, there is no Buffy to save you.

But before you go out and buy garlic and holy water in bulk, these vampires can be stopped by simply flipping a switch, or unplugging a cord. Meet the energy vampire, which usually takes shape in the eerie glow of all those little "standby" lights on your electric devices and appliances. Because these devices receive signals at all times, they silently suck energy even when they are turned “off.”

According to the Union of Concerned Scientists, energy vampires add up to an estimated 65 billion kilowatt-hours of electricity each year. This extra electricity costs consumers more than $5.8 billion annually and sends more than 87 billion pounds of heat-trapping carbon dioxide into the atmosphere each year. (Yay for global warming?) According to Best Buy, 40% of all electricity used to power electronics and appliances in the average American home is consumed while the devices are turned off. Not only that, each of those homes has about 20 to 40 electronics plugged in that abuse vampire power. How much does it cost? This vampire energy adds up to between 5% and 8% of a single family home's total electricity use per year, according to the Department of Energy. That's the equivalent of about one month's electricity bill.

The UCS says that some of the biggest energy wasters in most homes are the adapters that come with rechargeable battery-powered cordless phones, cell phones, digital cameras, music players and power tools. Most draw power whenever they’re plugged into an outlet, they say, regardless of whether the device battery is fully charged—or even connected. Other culprits include appliances or electronic equipment with standby capability (such as televisions and computer monitors), a remote control, and/or a digital clock display (such as microwaves, DVD players, and stereo systems).

So how do you become a vampire slayer?

• Unplug appliances directly from the wall when you're not using them. If you have several in one area (such as a computer, printer and myriad iPod/cell phone chargers) attach them to a single power strip and turn off the power switch when they aren't in use.
  

• If you won't be using your computer for a while, but you don't want to shut it down, turn off the monitor. This will save much more energy than using a screensaver (screensavers alone can cost you up to $100 a year).

• Reduce the brightness on your TV and computer screens by half. This can reduce their energy usage by 30 percent.

• Turn off lights whenever you're not using them (which we all do anyway, right?), and use natural light as much as possible during the day.

• When purchasing appliances like a refrigerator or dishwasher, look for the EnergyStar label. These appliances can sometimes use half as much energy as other appliances.

• Take stock of your appliances. Has that extra TV in your guest room been used in the past few months? When is the last time you watched anything on your vintage VCR, which has remained plugged in and collecting dust for the last four years?

The impermanence of money

My grandfather passed away this weekend. Naturally I didn't feel like writing for a few days, which was interesting since I usually write to sort through my feelings. Although I did work on my novel a bit, I couldn't bring myself to write a blog post.

I guess I had an existential crisis of sorts and was left to ponder my life and the topic of money -- what is money good for to me, does money really matter in the grand scheme of things, and why do I write on it incessantly, versus say literary analysis, in a blog? Okay, so money may make the world go 'round because of the obvious reasons (i.e., we need it to eat, have shelter, etc.), but when did saving money become such a falsely quantifiable science based on some pre-determined age you think you'll live until? Take my blog, for instance: "Mastering the art of saving now to live lavishly later." What if there is no "later", and there is only "now?" Say I scrimped and saved every penny I could, forgoing things I'd love right now like a trip to Italy or an espresso maker, on the premise that I will enjoy my money when I'm older?

Perhaps I just need to vent, but I see two problems with this equation:

One, I have a feeling that one day when I'm older, I'll look back at all the time I wished I had traveled more at this age, and resent the fact that I didn't take advantage of all the energy I had to traipse around the world. At 26, I'm not who I was at 21, and that's just a five-year gap. Before I used to pull all-nighters with no problem, and relished going out with friends and meeting new ones. I was an endless reservoir of energy and enthusiasm, a social butterfly who was always up to try anything new. Nowadays I don't feel like that plucky spring chick I once was. (Am I getting old? Eep.) I'm often tired when I get home from a full day of work, I spend any extra vigor I have on kickboxing or writing at night, and look forward to the weekends when I can recharge my battery and veg like broccoli. (Usually retail therapy or lunch with friends works best for me.) If I feel like this now, what am I going to feel like at 47, my scary age? More importantly, if I feel this way times 10 at 47 (don't people get tired the older they get?), why would I want to pack my bags and go yodeling with goat-herders in the Swiss Alps or mash grapes with locals in Portugal to make homespun wine? I want to do all that when I look and feel impossibly fresh-looking. Isn't money meant to be enjoyed (responsibly, of course) in the crevices of our youth? I often see older, white-haired men driving sleek Porsches, and I wonder if they ever wish they could have had all that 25 years ago. After all, money can buy you a sportscar, but it can't buy the feeling of being young again.

The second problem to the "saving for later" equation is that none of us know when we'll die. I've never had anyone close to me die before this weekend, and I've been grappling with my mortality ever since -- it was something I thought about every once in a long while, but it never seemed likely. Me? Die?? Pffff. Exactly. Oh how naive I was, before the recent dose of reality sobered up my inebriatingly puerile state. It's a grand plan to save up for an early retirement at say, 50, 65, or 85, but what if you don't make it to then? (Of course, the argument against this would be "Well, what if you do make it to 50," but then that turns into a "chicken or the egg" debate, and we won't go there tonight.) I think it's very important to plan for the future, but when does fiscal planning simply turn into tightwad-ism ... maybe, even, for the rest of your life? Could you ever, then, enjoy your money later if you've so trained yourself to be mechanically frugal in the present?

I think it's important to think or write or talk about money, but it's equally as important to not allow money to take over your life. I know that it's easier said than done, especially when you don't have much of it. To me, money has always equated to power. Although I always knew that money couldn't buy you everything (though it seemed to help out with happiness, depending on your definition of the word), now my beliefs have been reaffirmed, especially that money cannot buy you perfect health or immortality. We all die in the end, no matter how poor or rich we are. My grandmother told me recently on the phone that "None of us get out of here alive." If that wouldn't take the "power" out of any millionaire's wings, then I don't know what would.