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Charity Scams
- Image by Emery Co Photo via Flickr
‘Tis the season to give away your stuff.
As Christmas rolls in, it’s common to see people ringing bells for charity outside of stores, or knocking on doors asking for your help with their pet causes. Phone and mail solicitations are up. You’ve got your pockets open and everybody’s hoping for some cash.
Good for you. Charity is wonderful.
I openly treat charity as the selfish act it truly is. Donating my time and money to causes I support makes me feel good about myself. I like feeling good about myself. The other reasons people give to charity are A) to make people like them, or B) to receive tax deductions. That’s it. There are 3 possible reasons to donate: to like yourself, to make others like you, or to save some tax money. I thought about adding guilt to the list, but that is covered by some blend of the first two reasons.
How can you know that the charity you are donating to is worth it? There are a ton of evil bastards out there trying to cash in on your desire to feel good. They want your money because rolling around naked in ill-gotten gains is what makes them feel good. Naked scammers sprawled across my cash isn’t a visual that makes me feel good.
Wait, you say? People use charities for cons, you ask? In 2005, The National Arthritis Association was busted for convincing people that it was somehow related to The Arthritis Foundation, when in reality, it was using the money for hookers and blow. Or something decidedly not arthritis-cure-related. If a charity sounds like something you know, but isn’t quite there, check into it before you donate.
It’s also common for scammers to run a phone campaign, pretending to be the Red Cross, the Salvation Army, or United Way. Those are all good charities, but they don’t benefit from the good intentions of the victims. The scammers just want the credit card information. Once they have that, it’s off to Rio for a crazy week of xxxxxx on a xxxxxx with a xxxxxxx for xxxxxx. (Editor’s note: This is a family-friendly blog.) Don’t give out your credit card information to anyone over the phone. Ever. Tell the caller to send you something in the mail, or promise to visit their website. But don’t give them the keys to your cash.
How can you avoid funding a Nigerian coup that will surely end in the downfall of the righteous king, causing all of his heirs to email me(as the only trustworthy person in the world) to help move the nation’s fortune out of the country in exchange for a mere 10% of the loot? I mean, how can you be sure you are donating to a good organization?
The easiest way is to ask the IRS. You can call them at 877-829-5500 or visit their website at http://www.irs.gov/charities/article/0,,id=96136,00.html to search for charities that have actually filed with the IRS. Not all charities have filed. Some state-based nonprofits don’t bother, but you can check with your Secretary of State to verify their status.
Always pay by check or credit card. Cash is untraceable. If a charity turns out to be a scam, leaving a trail makes it easier to prosecute.
Don’t give in to the guilt-tactics. If a charity is worth giving to today, it will be worth it tomorrow, too. There’s no rush. If the solicitor is trying to rush you, it’s probably a scam.
Remember, it’s your money. Take care of it.
What are your favorite charities?
Why I chose a prepaid credit card
This is a guest post.
You can’t get credit without a credit card, and you can’t get a credit card without good credit. This is a dilemma that many people find themselves facing, whether they are trying to re-establish their credit or build credit for the first time. In fact, this is the dilemma that I found myself in. My solution was to get a prepaid card, and here’s why.
The Real Deal with Prepaid
Prepaid credit cards have earned a mixed reputation over the years. While it’s true that they usually have more fees than a regular credit card, they also offer a financial solution for people who don’t have good credit. And you should also keep in mind that they don’t charge interest because the cash that you are using is yours to begin with. The important thing to remember about prepaid cards is that they are a means to an end; once you rebuild your credit, you’ll find it much easier to apply for a card with better rates and fewer fees.
In addition, prepaid cards offer several advantages. The most important one for me was the convenience of having a card that I could use to make purchases. Prepaid cards look and work exactly like regular credit cards (you don’t have to enter a personal identification number to use them), so the only one who knows it is prepaid is me. And while I use cash for everyday purchases, there’s no avoiding the need for a card when you have to shop online or pay for gasoline at the pump, for example. Most digital merchants only accept payments from cards linked to large financial brands like Mastercard and Visa, and my card gives me a way to buy what I need from whoever has it in stock. In addition, my prepaid card offers me a way to keep track of all of my purchases electronically, which is helpful since I am trying to keep a closer eye on my budget.
Prepaid cards also offer security. Cash can easily be lost or stolen, but if you lose a prepaid card, you can easily get a replacement. More importantly, your balance is protected by a replacement guarantee from your bank, which comes in handy if you ever have to dispute fraudulent charges.
Perhaps the most convenient factor of a prepaid card, though, is how easy it is to get one. You don’t have to have a bank account in your name to receive a prepaid card. However, if you do have an account, you can easily link it to your prepaid card.
Changing my spending habits and getting out of debt hasn’t been easy for me, but one way for me to show creditors that I am getting better at managing finances is to build my credit with my prepaid card. It’s also a way for me to eventually be able to make big purchases that are necessary, such as a car, and hopefully one day, a home. Prepaid isn’t for everyone, but if you find yourself considering this option, it’s worth a second look.
Tips to budget successfully
This is a guest post written by Andreas Nicolaides, a financial author for UK based MoneySupermarket.com.
Whether your aim is to save money for a special occasion or you just want to make sure you don’t have to struggle financially when it comes to the end of the month, a budget can be a saving grace. Budgets help us quickly and easily identify our total income and all our expenditure, allowing us to plan for the best and prepare for the worst financial situations.
Set yourself a target
If you have decided to set up a budget, then there must be a reason. Are you looking to save for an upcoming event? Or maybe you have realised that you are struggling to make your payments every month and you would like to feel more financially secure. Based on what you would like to get out of your budget, you should set yourself a specific, measurable objective.
My first objective I set for myself was to save $100 every month for a year. This sort of objective is easy to manage and easy to monitor and this is what we are trying to achieve. One important thing I would mention here is to ensure your objective is achievable; don’t set yourself a target that is too far out of your reach, being realistic is extremely important.
How do you set up your budget?
The main key thing when you start to put your budget together is to make sure you’re as honest as possible. Get yourself a pen and some paper and on one page detail all of your income. Include the obvious and also remember to include any benefits you are entitled too. Then grab another piece of paper and detail all of your monthly outgoings, remember to be honest and thorough and try not to forget anything. Once you have both figures, deduct your expenditure from your monthly income that will give you your monthly figure.
You have some extra cash?
If when you have your figure you realise that there is some cash left over, you can then decide what you want to do with it. My advice here depends on your own personal circumstances, for example if you have high levels of debt, your main aim should be tackle your high interest debt aggressively and as often as possible.
If you have some money left over and your aim is to save, then set up an interest bearing bank account. If you are based in the US then you could look to set up an LSA or lifetime savers account. In the UK we have the equivalent, that is called a cash ISA saving account.
No money left over?
If after working out your budget you find you have no money left over, then you need to do something about it. Debt is one of those things that won’t just disappear overnight; it’s something that takes time and commitment, but not giving up is paramount.
How to cut down your expenditures?
One of the main things you can do when you realise you are in a bad situation is to try and cut down on your expenditure. Here’s a couple of quick ways:
- Use price comparison sites – These sites are great to check and see if you are paying too much on your bills, and if you are, you will have a list of fantastic options available for you to choose from. This is a great way of saving money on things like your car insurance, see here.
- Sell unwanted items – Selling unwanted items is a quick way to making some cash, everyone has them around their home, so why not make use of them instead of letting them build up dust?
- Cut down on your spending – Try to avoid buying luxuries and try to stick to a specific shopping list when out doing the weekly food shop, this will help you avoid unnecessary purchases
A budget is used by many just to monitor what they spend month to month, but I hope I have detailed how it can be a helpful financial tool that can help you reach your financial goals. I hope my tips to budget successfully will help you get started on your way to financial freedom.
Book Review: Delivering Happiness
In April, I was given an advanced reader copy of Delivering Happiness by Tony Hsieh on the condition that I give it an honest review. Delivering Happiness is being released today and here is my review.
Tony Hsieh was one of the founders of LinkExchange, which sold to Microsoft for $256 million in 1999. Shortly thereafter, he became affiliated with Zappos.com and ended up as CEO. Zappos.com was later sold to Amazon.com as a “wholly-owned subsidiary” in a stock-exchange transaction valued at $1.2 billion.
Delivering Happiness is his story and that of the creation and management of Zappos.com.
The book is divided into three sections: Profits, Passion, and Purpose.
Section 1 is largely autobiographical. It tells the story of Hsieh’s business ventures all through his life, from a failed worm farm to a failed newspaper to an abandoned greeting card business. Obviously the business of having children sell greeting cards had improved between his childhood and mine, because, when I did it, there were many more choices than just Christmas cards. I still have both the telescope and microscope I earned selling overpriced greeting cards. An important lesson imparted is that past success is not an indicator of future success. Different personalities, goals, and economics can change the result of two nearly identical activities.
Hsieh tells the story of the excitement of building LinkExchange and how he knew it was time to move on when the excitement faded, largely due to a surprising change to the corporate culture. After leaving, he spent some time just living and reviewing his past activities. He came to the conclusion that the happiest times of his life didn’t involve money. Doing things right beats strictly maximizing profits. Taking business lessons from the poker table, he reminds his readers that the Right Decision may lose sometimes, but it is still Right.
When he gets into building his business on a foundation of relationships, he is reminiscent of Keith Ferrazzi. Don’t network. Build your relationships based on friendship and let the friendship be it’s own reward. The rest will follow.
Section 2–while denying it was intended–reads heavily like marketing copy. It is almost entirely about how wonderful Zappos.com is to work for and with. I think it is fascinating to read about how successful businesses are built and how the corporate culture comes with that, but it’s not for everyone. The important points from this section include being open to necessary change without being reckless and their insistence on transparency. I don’t believe in hoarding information and it’s wonderful to hear others feel the same way. They go as far as giving all of the profitability and sales numbers to the vendors, live, which makes the vendors feel respected and gives the vendors an opportunity to suggest future orders based on past trends. That saves time and effort for the buyers at Zappos.com.
Section 3 attempts to tie the business lessons to life lessons and almost–but not quite–succeeds. After discussing differences in vision and alignment between the Zappos executives and the board, he talks about his growing speaking arrangements. When he started, he nervously memorized his presentations, resulting in mediocre speeches. When he discovered his “flow”, it all improved. His method of writing and speaking involves being passionate about his topic, telling personal stories, and being real. When he adopted that plan, his speaking became natural and popular.
In the final chapter, Hsieh actually discusses happiness. His equation is Perceived Control + Perceived Progress + Connectedness + Vision & Meaning = Happiness. He works to apply all of this as a part of the corporate culture at Zappos, giving the employees a measure of control over their advancement, duties, and culture. The employees help write the Corporate Culture book, which is given to all new hires and vendors. I intend to get a hold of a copy in the near future. It sounds like a fascinating read.
He also addresses the three types of happiness: Pleasure, Passion, and Higher Purpose, also described as Rockstar, In The Zone, and Being a Part of Something Bigger. The first is fleeting, and the last is long-lasting.
Would I recommend the book?
Yes. I found Delivering Happiness to be incredibly interesting, but, if you have no interest in how a successful-but-not-traditional company is built and run, or if you are bored by successful people, this book is not for you. The book is largely autobiographical and a case study in the success of Zappos.com. If that sounds remotely interesting, you will not regret reading this book.
Now, the fun part. I was given two copies of the book. The first one is becoming a permanent part of library. The second is being given away.
Giveaway
There are three ways to enter:
1. Twitter. Follow me and post the following: @LiveRealNow is giving away a copy of Delivering Happiness(@dhbook). Follow and RT to enter. http://bit.ly/czd31X
2. Become a fan on Facebook and post about the giveaway.
3. Post about the giveaway on your blog and link back to this post.
That’s 3 possible entries.
Next Sunday, I will throw all the entries in a hat and draw a name.
Future Reviews
If you have a book you’d like me to review, please contact me.
Twitter Weekly Updates for 2009-12-19
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