SPG AmEx Card Promotion: 30,000 Bonus Points Worth $600
American Express is having a promotion for its Starwood Preferred Guest credit card. If you apply for this card and charge $1,000 during the first three months, you will get 30,000 bonus points in the Starwood Preferred Guest (SPG) program. Starwood operates hotels under Four Points, Sheraton, Westin, W, and few other brands. SPG points can be redeemed for free nights at those hotels. At a value of at least $0.02 for each SPG point, the 30,000 bonus points are worth $600 or more. I applied and received an instant approval. The promotion ends on July 6.
This is not a sponsored post. American Express or anyone else doesn’t pay me anything if you apply. I’m just passing along the deal.
I knew about this card for some time. I didn’t apply until now because of its $45 annual fee (waived in the first year). Now the signup bonus will cover the annual fee for the next 10-15 years.
Why a Credit Union Isn’t For Everyone
I joined Alliant Credit Union back in December. So far, I primarily used the savings account. Because all my bill payments are on autopilot, I didn’t want to go through all the trouble of making changes to the checking account. But I’ve come to like Alliant Credit Union more and more. I decided use its checking account for some bills.
The biggest difference is that Alliant pays 1.5% interest on the checking account balance versus others paying near zero. There are no minimum balance, no interest rate tiers or cap, and no debit card usage requirement. To get the 1.5% rate, you only have to get paperless statements and have one electronic deposit a month (ATM, direct deposit, or transfer from another account).
As I mentioned in the previous post, anyone can join Alliant Credit Union by joining a PTA or by donating $10 to Orphan Foundation of America. Alliant doesn’t pay me in any way if you join.
Do You Cheat On Your Taxes?
Do you cheat on your taxes? Before you automatically answer no, hold that thought.
Does your state have a sales tax? According to Wikipedia, only five states don’t have a sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. There is a sales tax everywhere else. For purchases from an out-of-state store that does not collect sales tax, the states usually have a use tax, with the same rate as the sales tax. You are supposed to report and pay the use tax for these out-of-state purchases.
Have you?
According to Wikipedia again, 22 states including New York, California, Ohio, and Virginia have a specific line for use tax on the state income tax return. If your state income tax form has a line for it, what did you put down on that line? Did you leave it empty? Did you include everything you bought online? If not, is that cheating on your taxes?
A Checking Account Wants to Be Free
Wall Street Journal ran an article by reporter Robin Sidel End Is Seen to Free Checking a week ago. Over the weekend, it published another article by the same reporter The New Bank Fees: How to Fight Back. Both articles said because new rules from the government will reduce banks’ revenue from overdraft fees and possibly debit card interchange fees charged to the stores, banks will stop offering free checking accounts.
I have two comments. The first one is:
Why should a checking account be free?
Staples Sets an Example for Good Service
I wrote a while ago we should be ready to pay more for good service. I have an example to share today.
I bought a file cabinet from the office products store Staples a few years ago. I only used it for storing random things, not files. As such, I didn’t install the rails for hanging file folders. Now I want to use it for files, but I can’t find the rails. Maybe I threw them away thinking I would never use them. So I called Staples and asked if I can get the rails somehow.
I didn’t know what to expect but I thought I would try. "I’m sorry, but the rails only come with the cabinet" would be a reasonable answer. Or it could be "We don’t have the rails. Here’s a phone number for the manufacturer." I would be happy if they tell me "We sell the rails for $4.95 a pair. Would you like to order them?"
Book Review: No One Would Listen
Being a financial blogger, I often receive requests for reviewing books. I usually ignore them but when I was offered No One Would Listen by Harry Markopolos, I took the offer because I’m fascinated by the story.
Harry Markopolos is the guy who sounded the alarm on Bernie Madoff’s giant Ponzi scheme. He submitted detailed evidence to the SEC several times over ten years, only to be ignored and deemed "not credible." After SEC finally conducted an investigation, they only asked Madoff to file some papers and register as an investment advisor. Madoff became more legit than he was ever before. He was able to claim he was examined and cleared by the SEC.
The most astonishing part of the story is that Madoff didn’t execute any trades in all those years. If only the SEC asked for trade tickets and double checked with the parties on the other side of the trade, the whole scheme could’ve been revealed very easily. SEC’s failure is bureaucracy and incompetence of the epic proportion.
Is It a Buying Opportunity Yet?
The stock market is having a correction. A month ago the Dow fell 1,000 points in day before recovering most of the loss at the close. Last Friday the S&P 500 index closed at a lower level than the lowest point reached during the so-called "flash crash."
Whenever the stock market gets a hiccup, there are always two schools of thought. Some worry a crash lies ahead. Some say it’s a buying opportunity. Fear and greed have been living with the stock market forever.
What should an investor do? If you believe a crash lies ahead, you should get out of the market, let it crash and get back in at a lower point. If you believe it’s a buying opportunity, you should buy more when stocks are on sale. If you believe neither or if you don’t know, you keep doing what you always do. Investing would be really easy if you know which way the market will go.
Tax Deductions Extension: Property Tax, Sales Tax, College Tuition and More
My trusted tax source CCH reported that a tax extenders bill in the House is on the fast track to approval and enactment. It’s called American Jobs and Closing Tax Loopholes Act (HR 4213). It extends many expired tax breaks by one more year. Here are the major ones for individuals:
$500 or $1,000 property tax deduction for people who don’t itemize. This was originally for 2008 only. It was extended once for 2009. See previous post. Now it will be extended a second time for 2010.
Sales tax deduction. This primarily benefits people in states without an income tax on wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Sales tax paid can be deducted on the federal tax return. The deduction was originally for only two years, 2004 and 2005. It was subsequently extended through 2009. Now it will be extended again for one more year through 2010.
Pay More for Quality Service
If I ask people "Would you pay more for better quality or service or do you go for a lower price?" I’d imagine most people will say they don’t just go for a lower price and they would pay more for something better. However, my observation tells me people aren’t willing to pay more for better quality or service nearly as much as they say would.
My local NPR station did its twice annual fund drive last week (or is it three times a year now?). I haven’t seen any stats but I’d estimate a large percentage of regular listeners don’t contribute. They listen to the NPR programs because they like the programs. They don’t contribute because other stations are free. Then why are they not listening to those other stations? Because they like the NPR programs. It goes in circles like that.
Somehow we are able to justify paying more for better quality on physical products. Many people pay more to buy Macs because they like the quality. We all drive different cars — some are much more expensive than others. We have more trouble with the concept of paying more for better service, and maybe especially so for some types of service versus others.
Tax Cost Calculator
I usually include a spreadsheet when I post something about numbers and calculation. That way you can play with your own assumptions. I didn’t do one in my post last week Dividend Tax Going Up, Moving to Munis. My bad.
Reader Random Poster asked:
"If you did not hold any value stock funds in your taxable account, but rather only, say, a total stock market index fund, would you still make the investment changes?"
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