Saving Money

Bill Tancer, general manager of research for Experian Marketing Services, speaks at a retail summit in New York last year. Experian has just announced a new system that will issue a credit score to the underbanked, even if they have little or no traditional credit history. (Brendan McDermid/Reuters/File)

No credit history? You can still get a credit score, Experian says.

By Simon Zhen, Guest blogger / 07.04.12

Experian, one of the three major U.S. credit bureaus, announced a new scoring model that measures creditworthiness of consumers that have little or no traditional credit history. The product, aimed at underbanked consumers who have driven the rise in prepaid-card usage, includes data from rent payments and public records. 

“Many of the estimated 64 million consumers with limited to no credit history that are unscoreable by traditional credit scores are creditworthy,” said Steven Wagner, president of consumer information services at Experian, in a news release.

According to a study by Experian, 30 percent of the underbanked population (more than 20 million) exhibit financial behavior that would deem them to be low credit risks. This group is likely to qualify for better terms and interest rates on loans.

Called the “Extended View” credit score, it will include credit data, rental information and public record data. Experian’s Extended View score ranges from 401 to 990, compared to the 300 to 850 range for FICO scores, which are the most widely used credit-scoring metric by U.S. lenders.

The credit data is pulled from traditional credit reports and public record data includes information from various government agencies. In 2010, Experian introduced its RentBureau division, which collects rental payment data from property management firms and homeowners. This rental payment information is available through Experian’s credit reports and contributes to the Extended View score.

The scoring model is compliant with the Fair Credit Report Act (FCRA), which requires lenders to consider this score when evaluating a person’s credit worthiness if requested by the applicant. However, lenders still reserve the right to deny a loan application if a prospective borrower doesn’t qualify for the lenders’ criteria.

The Extended View score joins a handful of other credit-risk metrics from companies that are using alternative means to measure creditworthiness. In addition to the underbanked, these credit-scoring models also cater to consumers who have bad credit histories or those who’ve been living cash-only.

Shailesh Shrestha, a waiter from New York City, carries a plates during a rally to increase the state's minimum wage in Albany, N.Y., in this June 2012 file photo. Waiters and waitresses can follow these six tips to increase their earnings. (Mike Groll/AP)

Order up: 6 ways to make more money as a waiter or waitress

By Gideon Grudo, Guest blogger / 07.02.12

An opinion piece in The New York Times last week started like this…

Help wanted: Salary: $19,000 (some may be withheld or stolen). No health insurance, paid sick days or paid vacation. Opportunity for advancement: nearly nil.

That describes the hardships faced by food-service workers – 20 million Americans, with half of them working in restaurants. According to a recent report called The Hands That Feed Us by the Food Chain Workers Alliance (FCWA), the food industry employs more workers than any other, including health care and retail.

RELATED: Can you manage your money? Take our personal finance quiz!

Yet food-industry workers are so poorly paid, The Times reports, “The biggest workforce in America can’t put food on the table except when they go to work.”

I’ve been in restaurants for seven years, and I’ve learned to make a living with a combination of hard work and clever schemes. Here’s what you need to know to make it in this harsh world…

1. Focus on your tips

A little-known fact about servers is how little a restaurant pays them. Since they’re tipped employees, they fall under a special minimum wage. Federally, that minimum is set at $2.13 an hour – which hasn’t changed since 1991.

According to the FCWA report, that means that only 13.5 percent of those surveyed made a “livable wage” – giving them the ability to cover basic needs like housing, clothing, and nutrition.

I’ve made as little as the minimum when I worked in Texas five years ago and as much as $4.26 an hour in Florida last year. But neither would be enough to live on if you don’t…

• Forget about the hourly peanuts you make. It’ll all be sucked into the taxes you pay anyway. Concentrate on finding restaurants that are known for big tippers, not hourly wages.
• Keep track of your tips. If your tips don’t make up the difference between the tipped minimum wage and the regular minimum wage – last updated in 2009 to $7.25 – your employer is forced by law to pay you the difference. But there’s a caveat. The numbers are based on weekly totals. A bad shift today might be countered by a good shift tomorrow.
• Be responsible with the cash you get every day. Just because there are bills in your wallet doesn’t mean you can spend them. If you’re going out to have a good time, set a chunk of cash aside in your sock drawer – and don’t touch it. This is a big problem with some servers who let that cash burn a hole in their pocket.

2. Work long hours the right way

According to the report, only 11 percent of those surveyed worked more than 60 hours, with two or more jobs. I expected the number to be higher — working two jobs is smart.

Since employers are forced by law to pay you at least 150 percent of your hourly when you work more than 40 hours a week, most of them keep you from doing so. In the restaurant business, this translates to keeping you from picking up too many shifts or just sending you home in the middle of your shift. (I’ve had both happen to me.)

So, if your boss is stringent, work two jobs that’ll give you 25 or 30 hours a week. This way, you work as much as you want, and your wallet will reflect your hours.

3. Get insured one way or the other

Turnover in restaurants is high, so most of them see little value in investing for benefits. One of my managers used to joke that it’s only when restaurants force you to wear a tie that they care about you sticking around.

At my last job, we got a few minutes of vacation pay for every week we worked more than 25 hours. After four years there, I had accrued just a few days. According to the FCWA report, of those surveyed…

• 79 percent don’t have paid sick leave – or don’t know if they do
• 83 percent don’t get health insurance from their employer
• 58 percent don’t have health care at all
• 53 percent worked while they were sick
• 35 percent have used the emergency room as their primary care

Working for a chain of restaurants is more likely to get you health insurance – at the chain where I last worked, we had plans for both full-time and part-time employees. But don’t count on the job to give you benefits. Get health care on your own, if only to cover the basics. Check out our health care page to find discount rates in your state.

4. Move on up

If benefits are scarce, so is training and promotions. According to the report, of those surveyed…

• 81 percent never received a promotion
• 75 percent never had an opportunity to apply for a promotion
• 74 percent had no ongoing training from their employer
• 32 percent received no training at all after their first day

This doesn’t mean a salad prep can’t become a grill cook (which usually pays more). It just means that moving up is up to you. Like I told you in my guide to getting and keeping a restaurant job:

Don’t stop learning. Ask the bartender what good wine or drink goes with what dish. Memorize two or three suggestions a week. Within a month, you’ll know more than the others, meaning you’ll upsell more, getting guests to buy more than just what they wanted at first. Your wallet and your schedule will reflect this newfound knowledge.

This applies to cooks too. The kitchen manager at my last job started off as a busser and would stay late to help the cooks clean up – and in turn, they taught him how their equipment worked.

5. Take your breaks responsibly

Unfortunately, federal law doesn’t require an employer to give you a break. Thankfully, some state laws have this provision. In California, an employer has to give you at least a 30-minute break every five hours. In Florida, you get nothing unless you’re under 18. However, federal law says that if an employer does give you a break – five to 20 minutes – you get paid during that break.

According to the report, 40 percent of those surveyed never got even a 10-minute break. And 30 percent didn’t break for lunch.

I’ve never seen a manager object to someone taking a short bathroom break (which can translate to a cigarette or a quick phone call). But don’t be stupid about it. No matter what, never take even a five-minute break without your section (whether in the kitchen or out on the floor) being taken care of by a co-worker. That’s a quick recipe to get fired.

6. Be safe

According to the Occupational Safety and Health Administration, 4,960 workers died on the job in 2010. While serving food is a low-risk job, you can get hurt.

I once had a guest back into me and knock over a cocktail tray I was holding with four hot tea cups on it. I worked through my shift – but later found out I suffered third-degree burns on my neck and shoulder. Since this happened on the job, my restaurant paid for it all.

Back to the survey…

• 57.2 percent suffered injury or a health problem on the job
• 52 percent did not receive health and safety training from their employer
• 32.7 percent did not receive proper equipment to do the job
• 11.7 percent did something that put their own safety at risk

Most restaurants force you to wear slip-resistant shoes, or shoes that are specially made to stick to a wet floor. It’s not that they care for your well-being, it’s that they don’t want to be sued. If you slip and fall, and aren’t wearing the right shoes, they don’t owe you zilch.

For example, the first thing my manager did the night I spilled tea was…check my shoes. Only then did he authorize me to go to the hospital.

Newly built cars sit in a shipping lot near General Motors Car assembly plant in Oshawa are shown in this June 2012 file photo. Car rental can be unduly tricky, Ballenger argues, but with a little extra vigilance you can find extra discounts and protect yourself from unfair charges. (Mark Blinch/Reuters/File)

Hitting the road for July 4th? 7 ways to save on rental cars.

By Brandon Ballenger, Contributor / 06.30.12

I’ve rented a car just twice in my life – both times for out-of-town weddings, when I couldn’t risk anything going wrong with my venerable Ford Explorer. But by renting, I was taking a risk I didn’t even know about.

Did you know it’s legal for rental car companies to keep using cars that are under a safety recall? And even sell them without informing consumers of the defects?

An MSNBC report last week described the practice as “rental car roulette” and quotes Consumers Union representative David Butler about unrepaired recall incidents where “there have been real problems, accidents, and even in a few isolated cases, deaths.”

Two senators have proposed a law to ban the practice, but it’s been sitting in Congress doing nothing for almost a year. More recently, Sen. Barbara Boxer asked the four major rental car companies to take this pledge: “Effective immediately, our company is making a permanent commitment to not rent or sell any vehicles under safety recall until the defect has been remedied.”

According to MSNBC, only one of the four (Hertz) agreed, while the others released various statements either denying they rented recalls or making safety assurances.

Safety is obviously the No. 1 concern, but most renters are also concerned about all the ways you can be nickel-and-dimed. Here’s how to rent safer wheels with the best deals…

1. Check for recall models

At SaferCar.gov, you can look up safety recalls by year, make, model, or time frame and avoid renting a model that might have some vehicles under recall. You could also ask someone at the rental car center, or stick to the companies who claim to keep unfixed recalls off the road.

Even if the model you’re looking at isn’t under recall, car safety ratings vary a lot. You can look up safety ratings and top safety picks at the Insurance Institute for Highway Safety.

2. Skip the extras

Don’t accept or use goodies like a GPS, electronic tollbooth passes, satellite radio, or safety seats without knowing what they cost. You can save a lot by bringing your own – if renting a GPS costs $12 a day and you can outright buy a similar one for $100, just over a week of renting would pay for it.

3. Understand all the fees

Renting from an airport location, returning the car late, failing to fill up the tank, and dropping it off at a different location can all lead to extra fees. Money Talks News founder Stacy Johnson once made that last mistake – and paid $75 for it. “Which was more than it cost to rent the car,” he says.

4. Think before buying extra fuel

You might think it’s frugal to avoid a fuel surcharge (as much as $8 per gallon, according to Consumer Reports) by taking the seemingly generous offer to start you out with a full tank at, or even sometimes below, the local going rate. The catch is you have to buy the full tank’s worth, even if you only plan to use a few gallons. Plan your trip route and know the car’s mileage rate before considering this option.

5. Don’t get upsold

Many people don’t need to pay for rental car damage waiver coverage because their existing car insurance or credit card covers it. Check your policies and you can save up to $30 a day.

And unless you’re renting for business or carrying a lot of people/cargo, there’s nothing wrong with staying in the cheaper, smaller classes of cars. They’re easy to drive and park and get better mileage.

You don’t have to cram yourself into a subcompact – the difference between compact and full-size might be under $5 a day. It’s when you start looking at trucks, SUVs, and luxury cars that you see prices really jump to double or more.

6. Ask about discounts

Look into discounts through your employer, professional organization, AAA, AARP, and pretty much anything else you’re a member of. You can find a long list of car rental membership discount codes online. Especially if you’re renting for multiple days, 10 to 15 percent off is nothing to sneeze at. Don’t have any memberships? Chances are there’s still a discount coupon: Ask your favorite search engine.

7. Protect yourself

Paying for your rental with a credit card allows you to dispute mistaken charges later. Taking before-and-after photos and documenting existing damage to a vehicle can limit the risk of phony damage claims. If you’re offered a vehicle with too many scratches and dings to keep track of, ask for a different one in the same price range. Keep all your paperwork and receipts (including gas) for at least a few months. Take this seriously – damage claims can cost hundreds.

Brandon Ballenger is a writer for Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.

There’s no good reason to buy a new book. Pick up a copy online or at a local store for pennies on the dollar. Students at University of California, San Diego are protesting the price of text books that now average over $100 per book. The high price of college textbooks makes buying used especially attractive. (Robert Harbison/The Christian Science Monitor )

New? No thanks! 14 things you should always buy used

By Brandon Ballenger, Contributor / 06.27.12

We recently shared a list of 20 things you should never buy used. Because it’s often true: You get what you pay for. When it comes to safety, hygiene, and warranties, there’s no substitute for buying some things new.

But for the most part, you can save a lot of money without sacrificing quality by purchasing many things used. In fact, it can change your life.

1. Cars

The biggest way to save on car ownership is to avoid paying the sticker price. A properly maintained year-old vehicle looks and functions like a new car – but costs 20 percent less. If you can save just $4,000 by buying used, then earn 10 percent on it for 20 years, you’ll be $26,000 ahead. And if you can avoid interest by paying cash rather than financing your ride, you’ll be richer still.

You can find a reliable used car for $5,000. The older the car the greater the risk, but having a car inspected by a mechanic can reduce it. The important thing when it comes to cars: Ignore the commercials. Cars are transportation, not status symbols.

2. Houses

With new homes, you don’t have to worry about repairs. But even factoring in fix-up costs – which you’ll know prior to purchase because you’ve had a professional inspection done – a pre-owned house will normally save thousands over new.

According to the latest data from the National Association of Home Builders, the average price for a new home in April ($282,600) was about 25 percent higher than the average price for an existing home ($226,400). Save $50,000 by buying used and you’ll have a lower mortgage payment, freeing up cash to do other more important things – like saving for retirement.

Pre-owned also means more flexible negotiations and mature landscaping.

3. Books

There’s no good reason to buy a new book. Pick up a copy online or at a local store for pennies on the dollar. Or rediscover the library, which these days may even offer free e-book downloads.

The high price of college textbooks makes buying used especially attractive. But you can save even more by checking the library (before your classmates), finding a textbook exchange, or buying an older edition for less. Do some searching and you’ll find lots of ways to get textbooks cheaper, or even free.

Depending on demand and when a new edition is released, you may also be able to recoup much of your cost by reselling them in the right places. Money Talks News writer Ricky Michalski recently bought one of his chemistry texts online for $75 – and resold it for $72 four months later. That means he’s $72 richer than the student who paid full price, then threw that book in a box, never to be read again.

4. Timeshares

A new timeshare is a terrible buy. Reuters recently reported owners are so desperate to ditch the annual maintenance fees that many timeshares are selling for $1. If you can buy a timeshare for basically nothing, avoiding a developer’s high-pressure sales pitch will make you tens of thousands of dollars richer. Check out articles like How to Buy and Sell Timeshares.

5. Recreational toys

From boats to RVs to bikes, buying used makes sense: They’re terrifically expensive new, they depreciate rapidly, and if someone is selling, they may not have had the free time to use it very much.

6. Sports and exercise gear

Everybody wants to lose weight, but few make the time to do it. That means many people have exercise gear they want to unload cheap or even free on sites like eBay and Freecycle. There are also stores that specialize in used gear, like Play It Again Sports.

Weights can’t go bad, although you’ll want to test things like treadmills and other more complex equipment. As we mentioned in our Best Bought New post, bicycle helmets are one thing you should buy new for safety reasons. But otherwise, why not buy used?

7. Furniture

Used furniture from garage sales and consignment stores is often a great bargain – just ask Money Talks News writer Angela Colley, who refurnished her home for under $720. Look around your house and mentally add up the amount you’ve spent on new furniture. Had you bought used, you could easily have saved 50 percent, which means that money would be in your pocket instead of a furniture retailer’s.

Moving sales are great places to save on furniture, since moving furniture is expensive, and sellers have a deadline to dump it. Snap up bargains when college dorms and apartments start emptying in the Spring.

Added bonus of buying used: you might find stuff that’s better built than today’s.

8. Jewelry

Jewelry depreciates faster than cars. And unlike cars, used jewelry isn’t going to break down, and nobody can tell a ring made this year from one made in 1950. In fact, vintage styles can be highly sought after. Best sources include pawn shops, online at places like eBay, and government and other auctions. Obviously, if you’re buying something expensive, be knowledgeable or enlist the help of someone who is.

9. Baby gear

Baby stuff doesn’t get much use – they outgrow everything in months. So baby clothes, toys, and nursery furniture can be smart used buys.

But there are definitely used baby items to avoid. Car seats and cribs have safety risks, and everything should be checked for product recalls. If you’re not sure, say no. But if you are, you can easily save 50 percent or more.

10. Clothes

Clean out your closet and get a tax deduction by donating the clothes you don’t want to a thrift store. Better yet, take them to a resale shop and make some money. And while you’re there, shop around.

The problem with buying clothes this way – as with many things you buy used – is that it might be hard to find exactly what you’re looking for. But if you’re not in a hurry, buying used can cut your clothing budget by 90 percent. For nicer clothes, head to the thrift and resale stores closest to upscale neighborhoods.

11. Dishware

Dishes don’t go bad with time, and buying used can save 80 percent or more. Got a friend getting married? Odds are good they’re going to be getting rid of old stuff to make room for wedding gifts. Thrift shops, yard sales and online sites like Freecycle are also good bets.

12. Electronics

Used electronics are a mixed bag: Things a few years old might be obsolete or incompatible with the latest technology, and it’s often hard to tell whether there are hardware issues.

However, buying used a few months after a product’s release (or even getting last year’s model) can be a great way to save. Purchasing from someone you know personally is a good way to avoid lemons, and factory-refurbished items have been professionally examined and repaired, and may even come with a warranty.

Electronics are a great place to save because so many people foolishly feel the need to buy the latest edition of everything. Not being one of those people will make you richer.

13. Video games and movies

These media are a lot like books. Many buy them new, enjoy them once, then toss them on a shelf. If that’s you, recycle your entertainment money and trade them in.

Online-only stores such as Amazon and Newegg sometimes feature sales with new copies cheaper than the used ones at brick-and-mortar stores, so be sure and check. But used prices are typically 10 to 70 percent less than new, with the best deals on the older stuff.

As with electronics, patience pays.

14. Tools

Most people don’t use tools regularly, so it may make sense to borrow or rent them. But well-maintained tools last a long time, and are easy to find at yard sales. It can be hard to tell how much life power tools have left – so only buy them used from people you trust.

Bottom line? You can be thousands of dollars richer simply by letting other people take the depreciation hit that accompanies virtually all consumer purchases. While it’s convenient to go into a local store and walk out with something new, there’s a high price to pay for that convenience. If you can save $10,000 every year by buying used, then compound that money at 10 percent, in 30 years you’ll be $1,809,434 richer than someone who buys the same things new. And what have you sacrificed? Nothing. After all, those new items become used the minute you bring them home.

In this February 2012, file photo a yard sign reading "For Rent" is seen in Fremont, Neb. Moving a few miles away from ideal neighborhoods or signing a longer lease are good ways to save money on your monthly rent. (Nati Harnik/AP/File)

8 ways to lower your monthly rent

By Angela Colley, Contributor / 06.23.12

My landlord rents her properties at $850 a month. But I pay $750.

Why? Shrewd negotiation, patience, and a lot of research got me a $100-a-month discount. But that isn’t the only way to save money on rent.

1. Shop around

The Internet has turned me into a hardcore comparison shopper, and apartments are no different. There are dozens of apartment rental sites listing dozens of properties in my hometown. It pays to check out several of these sites when you’re looking for a new pad. I mentioned a few sites you should use (and a few you shouldn’t) in The Best (and Worst) Apartment Rental Sites.

But don’t stop your search with your computer. I found my last apartment through a “For Rent” sign in the window. The place was $150 cheaper than anything else I found, and I never saw an online ad for it.

2. Move a few miles away

Location is everything in real estate. If you live in the most popular area, you’re going to pay the highest rent. But if you move a couple of miles (or sometimes even a few blocks) away, you can get a serious discount. For example, renters in my city (New Orleans) pay about $1,250 a month to live in studio apartments on a trendy street. I live four blocks away and pay $750 a month for a one-bedroom. I don’t get bragging rights, but I’m still within walking distance – and I’m saving $500 a month.

3. Wait

I start looking for a new apartment a month or two before I need one. If I find a place I like, I keep an eye on it. More often than not, private landlords lower their asking price if they don’t find a tenant within a week or two.

4. Sign a longer lease

You’re locked into your rent as long as you’re under a lease. If you sign a longer lease, you’ll be locked into the lower rate if the cost of rent goes up. Two years ago, my friend signed a three-year lease on his apartment. Last year, the landlord raised the rent $200 across the complex. By locking himself into a set rate for three years, my friend has saved $2,400 so far.

5. Haggle

I am not a haggler, but when it comes to my single biggest expense, I negotiate. It doesn’t always work, but if you do your homework – and give the landlord a good reason – he may be willing to lower the rent. (Learn how to haggle here: The Simplest Way to Save on Everything.)

Start by researching the average rent in the area. If the landlord is charging more than everyone else, print out a few ads to prove it. Then convince the landlord that he should want you as a tenant. I ask for referral letters from my previous landlords, make copies of my bank statements, and pull my credit report. By showing the landlord that I’m a good tenant – and I know that he’s over-charging – I can negotiate a better rate.

6. Look for free perks

I always compare the cost of the rent with the amenities or the utilities that are sometimes included. For example, I recently looked at two duplexes. One went for $775 a month but didn’t include any utilities or a parking space. The other rented for $800 a month but included water, trash, Wi-Fi, and an off-street space.

Obviously, $775 is cheaper than $800. But when you consider the average water and trash bill in my area is $50 a month, and the average Internet cost is $45 a month, I’d actually save $95 a month by going with the more expensive rental.

7. Trade work for rent

If you have a skill a landlord needs, you might get a discount on your rent. My landlord rents a unit to a tenant who also serves as our maintenance guy. In exchange for doing the odd job, he gets $350 a month off his rent.

But you don’t have to be handy with tools. Landlords occasionally need people to maintain their website, design rental ads, or manage their properties. If you’ve got free time, offer to trade your services for a discount.

8. Turn a profit on your rental

A few of my neighbors have made a quick profit by renting out their place for the night to tourists. Granted, there are some serious downsides to the idea – like your place possibly getting trashed – but my neighbor made $300 in two nights. If you live in a popular city, you could stand to make a profit a few times a year. Just make sure you get your landlord’s approval – and ask for a security deposit before you open the door to strangers.

Angela Colley is a writer for Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.

This 2011 file photo shows a Visa card in a wallet in Richardson, Texas. Teaching your kids responsible credit card use is crucial to their financial future. (LM Otero/AP/File)

Credit card worries? 5 ways to teach kids about plastic

By Jason Steele, Contributor / 06.22.12

I review dozens of credit card offers each week to find the best deals. Check out more on our credit card page.

From the mortgage meltdown to out-of-control credit card use, Americans have a problem with debt. In fact, USA Today recently reported that many households now have a negative net worth. With everything we know about the burdens of credit card debt, parents need to raise their children to be responsible credit card users.

As a father and a credit card reporter, let me offer some suggestions…

1. Teach from an early age

Using a credit card isn’t a taboo topic to be whispered about behind closed doors. Even at 5 years old, our daughter watches me and my wife use our credit cards at stores – and we explain to her that we’re spending real money we worked hard to earn. The lesson here, lost on some adults, is that there’s a direct relationship between the amount earned and the money that can be spent. My parents did the same, teaching me that credit cards were not a magical source of money, and that we had to pay for everything we charged each month.

2. Make your teenager an authorized cardholder

By the time I was old enough to walk around town without my parents, they made sure I had a credit card – but under their account. At first, I was only to use this card with their specific permission or in an emergency. Later, they allowed me to make small charges at my own discretion, so long as I paid them back when the bill was due. The first person who grants a child credit should be their parents.

3. Pay bills together

Children learn a lot about our democracy by joining their parents in the ballot box, and they can gain an understanding about personal finance by sitting down to pay bills together. Discuss how much money you earn, how you plan your budget, and the importance of paying bills on time. If you pay your bills online, your teenager will probably be teaching you some Web tricks before too long.

4. Manage your child’s accounts together

When the time comes for children to open their own accounts, parents should hold their hands every step of the way. Whether it’s a child’s first savings account or a teenager’s first credit card, you should partner with your children from the beginning. Go to the bank with your child and show them how an account is opened. Or do it together online. Then follow along with your child as he or she learns how banking works. By the time you’re called in to bail your adult child out of credit card debt, it’s already too late.

5. Consider prepaid cards

One way to teach credit card responsibility is with a prepaid card. These products, which are becoming increasingly popular, combine much of the convenience and security of credit cards with the safety of debit cards. I recently started evaluating the American Express Prepaid Card, and I’ve been impressed so far. There’s no fee to order it online, no usage fees, and no monthly fees. Reloads using direct deposit or a bank account are free, and refills of up to $500 can be purchased at retailers for an additional charge of $3.95. At the same time, this product offers credit card-like benefits such as purchase protection and roadside assistance.

Bottom line

Parents have a duty to teach their kids strong financial skills. When they take the time to partner with their children and teach them how to manage credit responsibly, the rewards will be immeasurable.

Disclaimer: This content is not provided or commissioned by American Express. Opinions expressed here are the author’s and have not been reviewed, approved, or endorsed by American Express. This site may be compensated through the American Express Affiliate Program.

Jason Steele is a writer at Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.

A Delta Airlines passenger jet lands at Hartsfield-Jackson Atlanta International Airport in Atlanta, Georgia, in this 2008 file photo. Computer glitches on an airline's website can drive up the cost of your summer travel, but there are ways to avoid paying unfair prices. (Tami Chappell/Reuters/File)

Summer travel: 4 airfare price hikes and how to avoid them

By Jason Steele, Contributor / 06.19.12

A CBS station in Minnesota recently reported that Delta Airlines was charging higher airfares to frequent fliers when they logged into their account – and lower fares when they were not logged in. According to MSNBC, Delta claimed that this was “a computer glitch” that had been fixed after three weeks.

But as far back as February 2010, fliers were complaining online to Delta that they were being quoted higher fares when they logged in. Their official Company Representative even addressed the issue and promised to look into it.

Some of those complaining theorized that Delta was slow to fix the problem because it benefited them – it’s easier to sell tickets at a higher price to frequent fliers already loyal to the brand. Or as The Washington Post wrote, “Airlines have long internally discussed charging more to frequent fliers with a willingness to pay.”

This “glitch” wasn’t the first that Delta suffered – and that benefited its bottom line at the expense of its most loyal customers. I uncovered a problem with Delta’s SkyMiles back in March that didn’t receive any attention until Money Talks News was about to report it. (See Did Money Talks News Make Delta Do the Right Thing?)

So what should you do to avoid these glitches that never seem to favor the flier?

1. Perform multiple searches

Don’t log into your airline when you start ticket-shopping. Stay logged out and compare prices on different carriers. You can always add your frequent flier number when you make your purchase.

2. Search for one seat at a time

Airlines offer many different prices for the same seats. They group these seats into what they call price buckets. Each time one bucket sells out, the airlines quote customers a price from the next – and it will usually have higher prices.

But what if you need two tickets, and there’s only one seat available at the lowest price? Most airlines’ computers will actually offer you both tickets at the higher price.

To save money, always specify one traveler until you find the lowest price. Then, search again with the actual number of travelers and see if the price changes. If it does, you can always book one seat at the lower price and make a separate reservation for the others at the higher price.

Note that this trick also works for booking award seats at the lowest mileage levels.

3. Call to book awards

If you’re using your miles to travel outside of the country, there’s another online glitch that can hurt you: Airlines love to boast of their partnerships with other carriers, but the vast majority have neglected to include these flights in their online award searches.

As a result, you can pay more miles for fewer options if you just look online for award seats. The next time you want to use your miles to visit a destination served by an airline partner, don’t trust their online search engines – just pick up the phone and call for help. If they try to charge you a “telephone booking fee” for a partner reservation that can’t be booked online, ask them to waive it. I’ve found they will.

4. Get a refund

If you made a reservation or purchased a ticket, only to find out soon afterwards that a lower fare was available, try to get your money back.

The Department of Transportation issued new rules earlier this year requiring that airlines be able to “hold a reservation without payment, or cancel a booking without penalty, for 24 hours after the reservation is made, if they make the reservation one week or more prior to a flight’s departure date.”

Bottom line…

Realize that airlines operate their websites not as a public service but as a profit center. Sure, those sites make booking travel much easier, but you need to be just as skeptical about them as you would about a “Going Out of Business Sale” at a local store. You don’t stroll in there and just assume those are low prices, right? In both cases, you need to be skeptical.

Jason Steele reviews dozens of credit card offers each week  on the credit card page at Money Talks News,  a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.

This April 2012 file photo shows a rack of men's clothing at the B.A.T.H. House thrift store in Ozark, Ala. Dry cleaning is getting more and more expensive, but you can avoid huge bills by comparison shopping and checking your labels carefully. (Jay Hare/The Dothan Eagle/AP/File)

Four tips to save money on dry cleaning

By Gideon Grudo, Contributor / 06.18.12

Dry cleaning is expensive – and it’s going to get worse, according to CNN. The reason? Not the chemicals. It’s the hangers. They’re mostly imported from Vietnam, and the United States recently set up trade penalties on these imports. Not surprisingly, dry-cleaners are passing on that cost to their customers.

If I were an entrepreneur instead of a waiter, I’d open a dry-cleaning store called BYOH – Bring Your Own Hangers. You’d not only save money, you’d save metal and the planet. But until that happens, try these tips…

1. Decide if your clothes even need dry cleaning

Did you know that manufacturers are required by law to list “care instructions” on their clothing? That’s why you sometimes see the words, ”For best results, dry clean” on some garments.

But what does that really mean? ”This tells consumers that the garment can be washed without damage, but dry cleaning may be better for appearance and durability,” the Federal Trade Commission says.

If you’re afraid of losing color in the garment, do the Q-Tip Test: Wet a cotton swab and dab an area no one can see, like the armpit. If color comes off, take it to the dry cleaners.

2. Keep your clothes neat and clean

The best way to avoid the dry cleaner is to keep your clothes from getting dirty for as long as possible…

• Apply all makeup and fragrance on your skin before you dress.
• Clean stains immediately with stain-remover pens or at least warm water.
• Keep clothes folded or hanging up. Don’t throw them in a pile, and don’t keep them in plastic bags.
• Don’t hang pants on a normal hanger where you need to fold the pants over. Instead, get a smaller clip hanger (about a buck a piece at Target), smooth out the legs, and clip them to the hanger upside down. This way, you avoid wrinkles.

3. Bargain, but have something to offer

If you’re a loyal customer, it’s acceptable to ask for a deal, even if one’s not advertised. Many dry cleaners also offer tailoring, so if you’re in need of that service, suggest you’d like to make this place your one-stop shop for a simple 10 or 20 percent discount.

4. Comparison shop

Competition drives down prices, and now you can do the legwork without getting up from your computer…

• FindADryCleaner.net, for example, gave me 10 places less than 2 miles away from where I live. The site is free to use, and lets you choose the services you want in the dry cleaners, from comforter cleaning to shoe repair.
• Drycleanersindex.com touts more than 80,000 listings and links to news articles pertaining to dry cleaners. I checked it for Dallas, where my brother is soon to be a father and will probably need to use cleaners often. The site spat out 79 listings for the city.

 Gideon Grudo is a writer for Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.

A commuter reads on his Kindle e-reader as a subway train arrives in Cambridge, Mass. in this 2011 file photo. You don't need an e-reader like the Kindle to take advantage of the glut of free e-books available online. (Brian Snyder/Reuters/File)

Enjoy free e-books, no e-reader required

By Karla Bowsher, Contributor / 06.17.12

Every week I round up freebies for our deals posts. In the process, I’ve noticed there seems to be an almost endless supply of free e-books available online.

It’s almost enough to make me wish I had an e-reader. That is, until I learned I didn’t need to spend a couple hundred bucks to enjoy the Internet’s wealth of free e-book downloads.

E-reader manufacturers, as well as independent software companies, offer free reading apps that you can download onto your phone, tablet, laptop, or desktop computer. In other words, you could turn your phone or computer into an e-reader without spending a dime. Plus, that means one less electronic device to carry around and risk losing.

Of course, e-readers still have their advantages. Their screens are bigger than most phones, and they’re more portable than most computers. But what’s free is free. And even if you already own an e-reader, you can still add a free reading app to your phone and computer. The free reading apps for Kindle, Nook, and Sony Reader will sync your e-book collection so you can access it from multiple devices…

E-reader alternatives

Kindle offers free downloadable reading apps for smartphones (iPhone, Android, Windows Phone 7, Blackberry); tablets (iPad, Android); laptops, desktops, and netbooks (Mac, PC); and MP3 players (iPod touch). Money Talks News founder Stacy Johnson has criticized Kindle because it’s not compatible with library books, but I find Kindle offers a bigger selection of free e-books than the other brands of e-readers. And since most reading apps are free, there’s nothing stopping you from downloading Kindle’s reading app and one of the others.

Nook offers free downloadable reading apps for smartphones (iPhone, Android); tablets (iPad, Android); and laptops, desktops, and netbooks (Mac, PC).

Sony Reader offers free downloadable reading apps for smartphones (Android), tablets (Android), and laptops, desktops, and netbooks (Mac, PC). Yes, iPhone and iPad owners, you read that right: Sony Reader’s app is only available for Mac computers.

Other options: Do a Web search for whatever device you want to double as an e-reader (“free e-reader apps for Android,” for example) to learn your options. If you own an iPhone or iPad, you probably already know that Apple’s free iBooks is one. Google Play is Android’s equivalent. Kobo is another free reading app for phones – iPhone, Android, and Blackberry. It’s known for its collection of one million free e-books.

If you prefer to read on your computer, check out Adobe’s Digital Editions, a free downloadable software program.

Where to find free e-books

Kindle, Nook, and Sony Reader offer free e-books on their websites.

Other options:

• eReader.com‘s “FREE eBooks” page (eReader.com is the website of a Barnes & Noble-owned e-book publisher)
• Google Play’s “Top Free in Books” page
• Kobo’s “FREE eBooks” page
• Money Talks News’ Freebies page
• Project Gutenberg
• Sesame Street’s “FREE eBooks OF THE WEEK” page
• The University of Chicago Press’ free e-book of the month
• Your library’s website

What’s your favorite site for downloading free e-books?

Karla Bowsher runs the deals page at Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talks News.