An Ounce of Prevention

I shouldn’t be surprised by the increased number of bogus offerings, threats and scare-tactics arriving in my inbox, mailbox and phone. Scammers are offering everything from face masks to toilet paper and expedited deposits of the stimulus payments. Identity theft and related scams often spike during times of crisis. So…desperate times require extra diligence on our part, to protect our identity and our hard earned money.

The three national credit-reporting companies, Experian, Equifax and TransUnion, are offering free weekly online credit reports through April 2021. By requesting a free credit report at https://www.annualcreditreport.com/index.action, an individual will get a report from all three companies with the single application.

By establishing a “myEquifax” account at equifax.com/personal/credit-report-services/free-credit-reports  or by calling 866.349.5191, individuals can receive six free credit reports every twelve months from Equifax, through December 2026…that is in addition to the one free report that can be obtained each year from all credit reporting companies at AnnualCreditReport.com.

While checking your credit report is an important habit, there are other things individuals can do to protect their identity and improve their score.

  1. Pay all your bills on time if possible. It may get difficult with layoffs and furloughs, but try to make at least your minimum debt payments by their due date every month to avoid hurting your credit score.
  2. Contact your lenders for help and ask about hardship options as soon as possible—ideally before you miss a payment. Lenders may be able to temporarily lower your interest rate or payment amount, or pause your payments for a period of time. Lenders may also be able to place your loans in deferment or forbearance, which would eliminate payments for a time; as a result, there would be no late payments to report to the credit bureaus. Under the CARES Act, when a consumer contacts their creditor before falling behind in payments, and reaches an agreement with the creditor to a modified payment plan (reduced payments or forbearance), then the creditor may not report late or missed payments to the credit reporting company as long as the consumer follows the agreement. That protection for the consumer lasts until the later of July 26, 2020 OR 120 days after the COVID-19 national emergency declaration ends.
  3. Check your credit regularly and make sure the information is accurate. You can identify any potentially fraudulent activity and respond to it before it damages your credit.
  4. Dispute inaccurate information immediately. Remember that disputes need to be made with each credit bureau where the disputed information appears.
  5. Contact your service providers. If you do not think you can pay your utility, cell phone, cable or other monthly bills, reach out to your providers to see if they offer flexible payment options during this time.
  6. Be extra vigilant about protecting your identity. If you fear identity theft may occur or has occurred in your name, you can also place a free security freeze on your credit file so lenders cannot gain access to it. This prevents people from applying for credit in your name. You can lift the freeze at any time, for free.
  7. Seek financial management help. The Iowa Concern Hotline (800.447.1985) can put you in touch with a financial consultant who will provide confidential information and discussion, free of charge.
  8. For those with investment or retirement accounts, U.S. market fluctuations could cause significant concern. Before you make any rushed decisions with your investments, consult a reputable investment professional who can look at the details of your situation and provide personalized financial guidance on what actions, if any, you should consider at this time. Not sure where to start? The professionals at the firm holding your investments or with your employer’s retirement plan can be a first contact for analysis of your situation.
  9. Make a budget and plan ahead. If you think current conditions may affect your income or finances, consider tightening your budget to help make sure you have enough funds to cover your expenses.

For more information about free help and guidance during these difficult times, check out https://www.extension.iastate.edu/iowaconcern/.

Brenda Schmitt

Brenda Schmitt

A Iowa State University Extension and Outreach Family Finance Field Specialist helping North Central Iowans make the most of their money.

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To Reconcile or Not

Bank Check
Bank Check

Reconciling a checking account, comparing the bank’s records of checking account activity with your own records, is one of those things I learned when I opened my first account at the age of 16. There is something very satisfying when it matches to the penny AND it ensure that my checking account balance is correct.

It is a challenging to teach tech-savvy individuals to value and adopt the practice of reconciling their bank accounts. Many just rely on a phone app to ensure there is enough money in their account before writing a check. The flaw in this strategy is this: what if there are outstanding checks that have not yet cleared, so there is actually less money in the account than there appears to be on the banking app on your phone?

This week I learned an alarming new reason for reconciling your bank accounts. Over a period of several months, my daughter had purchased supplies for a group she volunteered for. She electronically deposited the reimbursement checks into her account by taking a picture of the checks with her phone. She put the deposited checks in a neat stack on her desk so she would remember to file or destroy them later. Weeks later, her husband found and deposited the checks not knowing they were waiting to be destroyed. He encountered no red flags or warnings, and the checks were deposited a second time. The error was not discovered until the group for whom she volunteered reconciled their account. Had they NOT reconciled their account, the error might never have been discovered.

I find this alarming. There was a period of time where I wrote checks at a large chain store; they scanned my check and handed it back to me. What if a dishonest clerk would have scanned it twice and pocketed the cash from the register? Her register would have balanced at the end of the day. What if I had lost the check and someone deposited it? What if…?

What measures are you going to take to protect yourself from this potential problem? For information about reconciling a bank account, check out How To Reconcile A Bank Account.

Brenda Schmitt

Brenda Schmitt

A Iowa State University Extension and Outreach Family Finance Field Specialist helping North Central Iowans make the most of their money.

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Coupon Scams

It’s time to buy picnic supplies, watermelon, hotdogs, and buns for the 4th of July.  Shopping with a list and a coupon or two would lower the grocery bill. Maybe that is why the $80 HyVee coupon scam is circulating again.

The coupon looks authentic and so does the web page where you land to retrieve your big bargain. In a congratulatory invitation, victims are asked to answer a “customer survey” that gathers their name, birth date, telephone number, and email address.  Sharing a social media link is required, expanding the circle of individuals exposed to the scam.  The personal information is then used for other scams or sold to scam operations.

The Coupon Information Center lists on their counterfeit notification page over 19,000 fake coupons.  Fake coupons are more likely to offer free items or high dollar values. They are also common in bulk coupon sales offers. (Manufacturer’s state on most coupons that the sale of their coupon is a violation of use.)

It’s illegal to modify coupons or use them for products other than identified by the manufacturer.  “Limited offer: one per customer” means just that, using multiple email addresses to receive online offers or making photo copies is a violation of law.

Remind yourself when you see a coupon with a value of $80 of the old saying: “IF it’s too good to be true, it probably IS!”

 

Joyce Lash

Joyce Lash

Joyce Lash is a Human Sciences Specialist in Family Finance who wants to keep you ahead of the curve on financial information.

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Your Phone Rings Again

Your phone rings and you don’t recognize the number. Sound familiar? At my house, nine out of ten calls are unknown, or out of area calls.  When I have a few “missed call” numbers, I put them in the computer browser to see they are legitimate or a scam.  Most of the calls are scams. Phone scams are common, and they often prey on people’s generosity or fear. Nearly 1 in 6 Americans have lost money to a phone scam in the last 12 months, according to the 2019 U.S. Spam and Scam Report.

They are good at it. Scam artists have perfected their pitch, and they use spoofed numbers to make calls look legitimate on caller ID. However, you’ll know it’s a scam if the person on the other end of the phone demands payments via gift cards or wire transfers. Requesting sensitive information such as Social Security numbers, birth dates and passwords should also be red flags. Seniors may be more trusting on the phone. Everyone should have a conversation with an older loved one.

Your best defense against these types of calls is just to ignore them. While some people like to waste a scammer’s time by stringing along the conversation, it may not be wise. Some scams use voice-recording software, and the more you talk, the more likely you’ll say something that the crooks can use to make unauthorized transactions in your name. It’s best to hang up immediately. 

Here are the top three scam phone calls:

  • THE IRS AGENT CALLING you on the phone. This call isn’t really from the government.  The IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information.  Note: they may call as a follow-up to a letter they have already sent, especially if you gave them a phone number and best time to call as part of responding to their letter. Please report IRS or Treasury-related fraudulent calls to phishing@irs.gov (Subject: IRS Phone Scam).
  • Technical Support Calls.  The caller says they are from a well-known company like Microsoft and have detected an error on a person’s computer. They will then talk the victim through a series of steps to “fix” the problem. A person is unwittingly downloading software that will hijack their system or give the caller remote access. Scammers use it to gather sensitive data or install ransomware, which will then require a payment to unlock a computer’s files.
    Older adults may ripe for this scam because they often lack technical sophistication. Younger people might recognize something fishy about Microsoft calling them, but seniors could be more trusting. These calls are always fake. Microsoft and other tech companies do not make unsolicited technical support calls.
  • Fake Charity Appeals. Charity scams are especially likely after a natural disaster or other tragedy. The crooks count on the good will of people who want to help. To avoid giving money to a criminal, don’t make any donations to unsolicited callers. Instead, do your own research to select a reputable charitable organization.

If you find yourself the victim of a phone scam, it can be difficult to recover money. However, you should file a police report and contact your bank. If your Social Security number has been compromised, contact the three credit-reporting bureaus of Experian, Equifax and TransUnion to request fraud protections be placed on your credit reports.

Susan Taylor

Susan Taylor

Resources are important whether you are looking to rent your first apartment, pay your bills, buy your first home or send your child to college. There are many ways to save money to reach your goals, and hopefully ISU Money Tip$ will be one of them. I enjoy traveling, needlework and am a novice gardener.

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Identity Theft and Your Tax Return

Social Security numbers have to be correct on tax returns. At the Volunteer Income Tax Assistance sites we receive an immediate reject on the return if the name and numbers don’t match Social Security records.  We also receive a reject code when a social security number has already been used on a tax return. Individuals must still file a return, but with the electronic submission blocked, it must be a mailed copy.

The IRS  and Iowa Department of Revenue will send you a letter saying more than one return was filed in your name.  Be sure to respond to the letter promptly. Use the internet to validate the IRS phone number and address (scam artists are now creating very good look alike letters). Call and discuss the evidence needed to support your tax return submission.

A letter will also be sent if the IRS or Iowa Department of Revenue has a record of earned income that you didn’t report on a return. It may mean your SSN was used by someone else so they could avoid paying taxes on their earnings.

Social Security numbers can be obtained through scams or by buying numbers that were stolen in a security breach.  If you have been notified that someone has committed tax-related identity theft with your personal information, report it promptly. Go to identitytheft.gov to complete and send the IRS Identity Theft Affidavit.  By doing this, you will also file a complaint with the Federal Trade Commission and obtain an ID Theft Recovery Plan.

After your identity is falsely used for tax purposes, the IRS will send you an annual PIN number (a new number each year). This PIN number will be added to your tax return to verify your identity to the IRS, and will prevent anyone else from continuing to use your social security number on false claims.

Joyce Lash

Joyce Lash

Joyce Lash is a Human Sciences Specialist in Family Finance who wants to keep you ahead of the curve on financial information.

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Smile! For the Camera

On Super Bowl Sunday in my area it was so foggy you could not see your hand in front of your face. While many were preoccupied with football (or the commercials), there were others that were taking advantage of weather that easily conceals illegal activities.

Padlock

On Monday morning, my colleague found that the family’s storage unit, located a few blocks from their home, had been broken into. In total, there were 4 or 5 units that had been broken into, plus it was obvious that unsuccessful attempts were made on several other units.  An examination of the storage units that withstood the break-in attempts made it clear that the quality of the padlock is what made the difference in the safety of the contents. My friend was lucky because only tools and equipment were stolen — not the classic car they also had stored in the unit.

This is a common problem among rural properties.  Farmers often have buildings that they only spend time in during the spring, summer and fall months. Thieves will frequently enter these building and take a few small items. Their intent is to see if you notice that the small things are missing AND to take inventory of larger, more expensive items stored in the building. They may also leave something leaned or stacked in a certain way that would topple or need to be moved if someone entered the building. These tactics inform the thief whether someone does visit this building.  After several weeks, if the building still appears un-visited, they will come back and help themselves to the big-ticket items. A lot of farmers use trail cameras, (cameras used by hunters to study the activity of animals in the area) to monitor building sites or even their homestead.

With all the new and fairly inexpensive security equipment on the market – doorbells with cameras, spotlights with built-in cameras and small camera units – it is no surprise that the police are having an easier time catching thieves. It is also interesting to see the number of police and neighborhood postings on Facebook asking for help in identifying thieves that are caught on home security systems. As for my friend, it was suggested by local police to consider using a trail camera to keep an eye on their storage unit and, of course, to purchase a better lock.

Brenda Schmitt

Brenda Schmitt

A Iowa State University Extension and Outreach Family Finance Field Specialist helping North Central Iowans make the most of their money.

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Credit Freeze

Thirty percent of U.S. consumers have been notified of potential compromise of their personal information in a data breach. In 2017, for the first time, more Social Security numbers were exposed than credit account numbers. Research finds that counterfeit use of credit cards is more difficult with the new microchip technology; as a result, criminals are focusing on new account creation. The number tripled in 2017 resulting in $5.1 million in losses. Now the Federal government is joining states to give consumers options to protect their credit history.

New federal legislation supports the right for individuals in all states to apply, free of charge, a credit freeze to their credit reports. The action can be taken after September 21, 2018.  By activating a freeze, you put a block on the creation of any new credit account by preventing prospective lenders from viewing your credit report. If lenders can’t confirm your capacity to repay a potential debt, they are unlikely to open an account in your name.   Iowa’s law went into effect in May.  Note: a freeze requires management; you must lift the freeze when applying for new credit.

If you are denied credit, lenders and agencies are required, by law, to send you documents informing you of your right to obtain your credit report and to dispute errors. The documents are now required to also notify you of your right to freeze your files.

In cases of identity theft, consumers have long had the option to place a fraud alert on their credit reports; the alert is a tip that this individual’s personal information was compromised, and consumers are still encouraged to pursue this action. The time frame for how long an alert is posted has been extended from 90 days to one year.  A fraud alert does not, however, block potential lenders from viewing your information; therefore it does not prevent unauthorized opening of new accounts in your name.

Joyce

Joyce Lash

Joyce Lash

Joyce Lash is a Human Sciences Specialist in Family Finance who wants to keep you ahead of the curve on financial information.

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Where Are Your Digital Assets?

First, what is a Digital Asset?  It is personal information that is stored electronically on either a computer or an online “cloud” server account.  If you use a computer, a password protected cell phone, social media, OR if you make online purchases, pay bills or do banking online – you have digital assets to consider.

Generally required is a user name and a password and/or PIN to access.  If a family member or friend becomes incapacitated or passes away, it is almost impossible to retrieve information without the user name and log in information.

Take time to record all of your digital assets in a safe place.  Share the information with the person to whom you have granted power of attorney, with your executor, and with other trusted people who would need to have it.

Need help identifying the potential digital assets? Consider the following:

Electronic Devices; Benefit Accounts; E-mail accounts; Financial accounts; online merchant accounts  – Amazon or Zappos.; Organization Accounts; Photography and Music Accounts; Publication Accounts; Social Media Accounts; Video Account; Virtual Currency Accounts with Cash Value; and Web Site Accounts.

So how do you plan for your digital assets? 

Use specific language in estate planning documents (will, trusts, and power of attorney) that authorizes your representative to handle digital assets as well as tangible assets.  Make a list of your digital assets in your will as you would for untitled personal property.  Don’t include private information (e.g. passwords) in your will, however, as it becomes a public document after someone dies.

 

Susan Taylor

Susan Taylor

Resources are important whether you are looking to rent your first apartment, pay your bills, buy your first home or send your child to college. There are many ways to save money to reach your goals, and hopefully ISU Money Tip$ will be one of them. I enjoy traveling, needlework and am a novice gardener.

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Credit Reports: Changes in 2018

A big thank you is in order from Iowa consumers to the Legislature, Governor Kim Reynolds, and Attorney General Tom Miller for passage and enactment of Senate File 2177  . Beginning on July 1st you will no longer be charged fees to use a “freeze” on your credit report.

The Equifax Breach put many individuals in a pool of consumers whose personal information was compromised. Faced with potential misuse, one step to limit damage was freezing your credit report at the three credit reporting bureaus, but the cost was $30.  In passing the new law, Iowa government officials reasoned that consumers should not be forced to bear the cost when a reporting bureau is negligent.

The credit bureaus are also making other changes: what data they collect; how it is reported; and credit score calculations.

  • All public record information, except for bankruptcy, is being removed from files.
  • Reports on medically-related debts are held for six months before posting to allow for insurance closures.
  • Medical debt is given less weight compared to other consumer spending when calculating your credit score.
  • Rent data can now be included in your credit report; only positive reports will be accepted.
  • A series of auto or mortgage inquiries are treated as one event.
  • Paid collection accounts will be removed from reports.
  • Keeping a card open that is paid in full will not help your credit score if it isn’t used. A card that is not used in a 3-6 month time period is dropped from credit score calculations.

Checking your credit report for accuracy is a good habit to maintain. If you haven’t checked yours in the past 12 months, now would be a good day to start!

Joyce Lash

Joyce Lash

Joyce Lash is a Human Sciences Specialist in Family Finance who wants to keep you ahead of the curve on financial information.

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Helping the High School Graduate Financially

Let’s be truthful, some of us do an excellent job helping our 17-18 year old get ready for the real world even if we also remember situations when we hope they didn’t pay too close attention to our bad habits.  Adult finance is complicated by some natural tendencies toward spending and savings. I’ve heard more than one parent wonder out loud how a child could grow up in their house and manage money the way they do.

Whether you have full confidence in their money management skills or expect to get several calls asking for guidance when the issue is totally out of hand, here are some tips that may help you and the 17-18 year old in your life:

Reduce their risks-

  • Review your insurance policies and find out if the coverage extends to include their property while they are living away from home temporarily. If they are leaving home permanently, pick up information about renters policies and explain it to them.
  • Share tips about auto insurance coverage. Remind them that valuables in the vehicle are not insured. Consider whether it makes financial sense to have them insured through their own policy. If the premium will exceed 10% of the value of the vehicle, it may be time to switch to liability only.
  • If they will continue to be covered by your health insurance plan: 1) confirm they will have access to the network providers; 2) make sure they are carrying an insurance card; and 3) share a quick reminder of typical preventive services and what to plan for co-pays.

Think ahead-

  • Recommend filling out their W-4 with a 0 for withholding exemptions until they have filed their first tax return. Several part-time jobs combined together can result in underpayment of taxes due.
  • Consider giving them a list of the records you save, electronically or on paper, for financial reasons.
  • Give them a shredder.  Not an exciting gift, but important to keep their identity intact.

Keep the door open for conversations without judgement. We’ve all done stupid things with money – why not make sure the young adult learns some lessons from you and not the hard way.

 

Joyce Lash

Joyce Lash

Joyce Lash is a Human Sciences Specialist in Family Finance who wants to keep you ahead of the curve on financial information.

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