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For a few years, a ring of criminals believed by the U.S. government to be based in India have been involved in a pervasive tax scam. Callers impersonate IRS officials, connect with American taxpayers, and convince many that they have an outstanding bill for tax payments.

The scam has been so pervasive that it has generated more than $15 million from panicked taxpayers.

CNN offers a story from a recent victim of the scam:

One of those victims was former NFL player Frank Garcia, who is now a sports radio host in Charlotte, North Carolina. When he got the call, it sounded so authentic, he left the radio station in a panic, scramming to get the money they wanted.

“The only thing running through my head is, I’m going to jail. I’m gonna be on television, in handcuffs, for tax evasion,” he recalled. “I had to follow specific steps not to be arrested. That the authorities had been contacted and in fact, they are on the way and will be there in 30 minutes.”

Garcia says he spent five hours driving to various stores around Charlotte, depositing $500 each time into a PayPal account set up by the woman on the phone. He ended up losing about $4,000.

Public figures tend to be more anxious than most people about being guilty of a crime. The destruction of a career in the public eye and a happy life is easy given the public taste for scandal and the American system of justice through trial by media.

And when you believe you might be in major trouble, the ability to think rationally sometimes disappears. To a reader, the idea that the IRS would have a PayPal account to collect past due tax bills sounds fishy, if not ridiculous. But in the heat of the moment, when you’re being threatened with jail time, you just want to problem to go away, and all possible resolutions sound legitimate.

the prevalence of media warnings about the scam has certainly helped slow down the perpetrators’ attack on taxpayers. I’ve even seen warnings on my local news broadcasts (but it probably won’t be totally effective and pervasive until reality show producers incorporate scam warnings into their shows).

Money offers a few tips, summarized below, for preventing yourself from being a victim of this scam, so while knowledge does help, as I’ve already mentioned, under stress logical reasoning often fails.

Scammers spoof caller I.D. The call may be coming from somewhere on the other side of the world, but the caller I.D. might say it’s coming from a number with a 202 area code (Washington, D.C.).

In reality, the IRS does not call taxpayers, and the organization especially doesn’t call taxpayers to inform them of an overdue tax bill. If a taxpayer truthfully owes tax, the IRS sends a bill, and offers instructions for the taxpayer to respond.

But I get how people can fall for this. Sometimes the U.S. Postal Service isn’t reliable. Sometimes you accidentally discard legitimate mail, mistaking it for junk mail. A caller can easily convince someone that they had sent notices through the mail which, from their perspective, were ignored.

Scammers ask for immediate payment. The real IRS doesn’t ask for payment over the phone, and are not in the business of setting up PayPal accounts to receive the funds or of instructing taxpayers to purchase prepaid debit cards. The IRS takes personal checks sent to official addresses and electronic payments through a government gateway, the Electronic Federal Tax Payment System (EFTPS) or DirectPay. That’s it.

This fact doesn’t change for taxes owed from previous years, even if you settle with the IRS for a lesser amount.

Even to taxpayers falling for the scam, it sounds like the callers are working somewhat outside the “system,” especially when they agree to settle. So an alternative form of payment might not raise any red flags.

Scammers threaten to arrest or deport their victims. The IRS wouldn’t do that. But it’s hard to believe this is not an IRS tactic when we know from media reports that tax evasion is a crime that results in arrest and deportation. If the scammers make victims believe that they could be guilty of tax evasion, the fear of being arrested is in their mind before the scammers “confirm” that will be the result of failing to pay.

And if you happen to be an immigrant fearing deportation, either because you are in the country illegally or believe it’s easy to be mistaken for someone in the country illegally, the threat of deportation could be so frightening (especially if you are escaping a dangerous home country) that you’re willing to do anything to remain in the United States.

Here’s what happens when you really do owe back taxes.

First, if you earn a paycheck from an employer and haven’t filed your taxes, the IRS will eventually catch on, and you will be expected to pay what you owe if you haven’t already through paycheck withholding. If you have paid taxes every year you owe taxes, but haven’t paid enough, you will still be expected to pay the remainder of what you owe.

The IRS will send you a notice in the form of a bill, identifying how much the government believes you owe and give you a deadline to pay. You will owe penalties and interest beginning with the date that tax payment was due, and that will be included on the bill.

If you disagree with the IRS assessment, you can call the IRS at 800-829-1040 to discuss the matter. But if you do owe the money, you will have to come up with some solution to pay. That solution could be paying immediately, as the IRS requests, agreeing to an installment plan, where you can pay the taxes over a period of time, or coming up with an offer in compromise.

The offer in compromise is available to people with a financial hardship, but the IRS must determine it would never be able to receive the full amount of tax owed.

If none of the above can resolve the issue, the IRS can resort to filing a federal tax lien, a legal claim to your property. The IRS may issue a levy, seizing your wages or bank accounts. These can continue until your tax bill is paid in full or the IRS can no longer legally seek repayment. You can lose your house, your retirement funds, and your income.

Because these consequences are so dire, it’s understandable that people are on edge when they receive a call purportedly from the IRS and therefore vulnerable to this widespread and successful scam.

Have you received one of these calls from someone claiming to be from the IRS? What happened on the phone call?

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The National Retail Federation has admitted defeat. Sales over the past holiday weekend dropped 11% over Thanksgiving weekend in 2013 according to the organization in a press release yesterday. The organization reversed course after being highly positive about the prospects for shopping leading up to the announcement of the estimated figures.

Shopping traffic for the weekend dropped 5% or 6%, depending on how you want to calculate it, compared to last year. The Federation tried to put a positive spin on the news.

I avoided shopping this weekend, from Thanksgiving day through today, the so-called Cyber Monday. Don’t get me wrong — there is much shopping I want to do before the holidays in December, but the excessive deal-wrangling this weekend just drives me away from wanting to pursue any shopping.

I’m not so much of a bargain hunter. I am interested in good deals, but most of the supposed bargains you see around Thanksgiving look good and sound good, but just aren’t all that good. And the details that are truly good, whatever that means, are almost always for items I wouldn’t want or don’t need.

For deal shoppers, the best time to buy is generally after Christmas, but there are a few obvious problems with that. First, it’s difficult to generalize. Overall, this might be true, but for any particular item, there’s no way to know. That’s why shoppers rely on Black Friday deal ads. They give shoppers some confidence, even if the resulting deal is not the most ideal price for any particular item. If you buy a gift using a Black Friday ad or Cyber Monday deal, you feel good about saving money, and for the human brain (but not your future self), that’s better than actually saving money.

The best method I’ve found for spotting good deals is CamelCamelCamel. This only applies if you have a specific item in mind, if that product is sold on Amazon.com, if Amazon.com generally offers the best price for that item among retailers, if you’re not on a tight time frame for making the purchase, and if you are willing to be a customer of Amazon.com. CamelCamelCamel is a website that tracks Amazon.com’s prices and can alert you whenever the price reaches a certain point. That price point could be one that you specify as your trigger, or it could be a price suggested by the CamelCamelCamel service using an algorithm that takes into the previous lowest price for the item.

The best thing about CamelCamelCamel is that it makes me wait. I’ve had items registered — it can work directly with your Amazon.com wish list if you want — for over a year, and suddenly, I’m alerted that an item, say a movie Blu Ray set, has reached my price point. The delay ensures I’m no longer under the influence of an impulse desire to purchase. Because if there’s something I want and need right away, and the cost is reasonable, I’m going to buy it right away rather than wait for a deal.

But if I know that, for example, the remastered Star Trek: The Next Generation season Blu Rays are eventually sold for more than a 60% discount off their initial sales price, usually within a year, I just set my price point trigger and wait.

And maybe more and more consumers are like me, bypassing the heavily advertised deals for more researched best prices. That could be one contributing factor to this year’s sharp decline in consumer activity over the traditionally biggest sales weekend of the year.

What role does the larger economy have? If people feel they are worse off financially, they might not plan on shopping as much this year as they did last year. If, however, people feel they are in a better financial position than they were last year, they could be less likely to pay attention to the holiday sales. In other words, you could use just about any state of the economy to justify both a strong and a weak holiday shopping season.

There might be some legitimacy to the idea that people feel better about the economy, which takes away from the desire to seek bargains at every opportunity. It’s clear that the recession in 2008 had long-lasting effects, not just in terms of employment, but in approach to life and money. Ideas like frugality, extreme saving, and supercharged planning for retirement became much more popular and legitimate than during times of stronger consumer confidence.

Throughout this period following the recession, I considered whether this was a permanent shift in approach along the lines of how the Great Depression affected an entire generation’s approach to money. The question was whether Millennials or Generation Y would be defined by the recession. My thought has always been that this is temporary, and I still think that is the case.

Perhaps this past weekend is the first indication that once Millennials feel more confident about their financial situation — and the lower gas prices may go a long way to reinforce that feeling today. Holiday sales are still driven by shoppers aged 18 to 34, so if this group is feeling better about the economy, this could be start of the generation’s shift away from conscious spending. It was fun (and successful) while it lasted.

The increase in confidence, whether it’s starting now or not, is going to have some profound effects. The value of assets — the stock market, real estate, etc. — will increase. Even if retailers continue to see problems throughout this year’s holiday season, the long-term prospect for sales are good. Confidence overflows into all areas of commerce, at least for some time. And during that time, shareholders benefit.

Workers feel confident about their employment prospects, so executives work harder to retain the best talent. Salaries increase. Disposable income increases. Prices also increase, but consumers handle it.

Another potential drawback that resulted in this year’s decrease in spending is the backlash surrounding the idea that retailers want to remain open on Thanksgiving Day. Retailers claim they are responding to customers’ demand to allow in-store shopping during the holiday, and there’s no doubt there are more than enough shoppers lined up during the holiday to give stores a reason to open. But employees are generally not happy. No one wants to be forced to work when the rest of the country is celebrating a holiday that supposedly focuses on time with family and friends.

And there are movements that encourage people to change their shopping behaviors during the holidays, whether’s it refusing to patronize stores that remain open on Thanksgiving, refusing to buy anything on Black Friday (also known as “Buy Nothing Day”), or encouraging shopping at family-owned local stores rather than large national and online retailers. These trends permeate Generation Y as much as or more than the desire to spend frugally. There’s no question that this disdain for large corporations, consumerist culture, and mass materialism has an effect on shopping attitudes for a good proportion of Millennial shoppers.

Did do any holiday shopping between Thursday and today? Was your approach different than last year’s? Are you spending more money for the holidays this year?

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The events that happened throughout my life, the paths that got me to where I am today, present an interesting story. I refer back to pieces of this story once in a while here on Consumerism Commentary but I never focus on it, nor do I ever really provide a complete narrative. When I write, I prefer to focus on things external to me. Although this blog started more like a personal journal interspersed with my financial details and interesting bits of information about personal finance, like many other long-lasting websites, it’s evolved over time.

Storytelling fills an important role. A good story triggers powerful emotions in readers or listeners, and these can be emotions of connection (like sympathy or jealousy or inspiration). Humans are emotional, not logical, decision makers, so strong emotions can cause readers or listeners to make decisions they wouldn’t have made without that emotional connection. Emotional triggers are certainly nothing new. Charismatic individuals have been using storytelling for centuries to spread religious beliefs, gain allies, and sell products.

The best salespeople today are keenly aware of this effect and use storytelling to convince people to spend money. A good story can change someone’s mind; a great story can change someone’s financial situation. Sometimes for the better, but often not.

For Consumerism Commentary, I try to think of ways to encourage readers to become better consumers: to make the most of the money they have, to improve their financial situation through building income and reducing expenses, to move towards a better financial situation than in the past even if full financial independence isn’t achievable. And, at least so far, I haven’t used my writing to sell products to readers. Yes, I’ve written or published some product reviews designed to help people make good choices about the financial products they use, including a way for readers to take advantage of those offers, but those have been generally directed at people who had already decided to use those products. I’ve tried hard not to sell someone something that wouldn’t be appropriate for them.

Storytelling has a much bigger benefit than selling products — it can sell ideas. And that starts to get dangerous. An inspiring story about quitting your job to blog full time can easily convince people who would otherwise know better to follow that same path in search of riches. I know for a fact that my personal success has given hope to people, even if their reasoning might have been, “If that fool can quit his job and sell a little blog for an insane amount of money, a smart guy or girl like me can do even better.” This is why I don’t make a big deal out of my story. This is why I take my role as a business coach for select clients very seriously. I don’t want to see people make huge mistakes.

People often ask me if blogging as a business has a future. People every day are quitting their jobs, ready to tell their stories online, ready to find a way to sell things to their readers, and they need to know if there’s a future in blogging. In fact, my girlfriend, who is also a blogger, asked me about this recently, but companies have paid me to hear my thoughts on the future of blogging, even though I’ve often been happy to chat with CEOs about it for free.

They ask me because I’ve been around. I’ve been on the Internet since about 1989. I’ve been building various types of online communities since 1990. I’ve been building websites and teaching people how to build websites since 1994. I know how to manage UNIX servers so I’m familiar with the technical side of the Internet, but I’m also as well as the social side (and that goes far beyond “social media”). And I watch related trends pretty closely, and I see a future that is troublesome for the small-time independent web publisher. Today’s environment is not one in which I’d suggest anyone quit their day job to be the next big blogger. Not without a head start, not without the financial backing that allows you to effectively compete, not without something that makes it clear that success is imminent.

That doesn’t mean bloggers can’t start today and become popular. That happens all the time. But translating that popularity into a sustainable living, or even better a valuable asset with the potential of lasting a long time or being recognized by the market as an acquirable asset, goes from rare to incredibly unlikely. But people beat the odds all the time. In fact, people who are more inclined to ignore the odds have an increased chance of meeting those goals, at least partially. I don’t want to say it’s impossible. The danger is in seeing others who have done something impressive and expecting the same will come with a little hard work. Make a living? Maybe. Make a great living? Well… Make a fortune? Doubtful.

The inspirational entrepreneurial story that spreads the lie that this path is the best way to secure a financial future is often incomplete. And the reason I’m writing this article in the first place is because I recently came across a story from a few years ago that is a perfect example of this. It shows you that a smart consumer will always need to look for the questions that go unanswered in any story.

Someone I follow on Twitter attended her sister’s wedding a few days ago, and posted a photograph of the two of them together, beaming with happiness. The individual I follow on Twitter will become clear in a few moments.

For some reason, I decided to look for more information, to learn more about her sister. One of the first things I found was her “origin story.” The trend with superheroes in movies recently is to present a character’s origin story — well, entrepreneurs have origin stories, too. And her story is about as sweet as it gets.

Mary Riesgraf — that’s her name — started a confectionery shop, Sweet Mary’s, in Los Angeles. The business is registered to a home address, so there’s probably no storefront. These are the words she told AllParenting in an interview:

Sweet Mary’s was started out of pure joy that my sweets brought to my friends and family. I started making homemade sweets for holiday gifts and everyone kept telling me to start a business. I was afraid of making such a big commitment so I didn’t consider starting a business until Fall 2011. My boyfriend Leif and my three daughters (Grace, 11, Sarah, 10, and Emma, 8) were my biggest fans encouraging me to go for it. I am so glad I started. I have had a blast making sweets and I love hearing all of the great feedback from our customers.

It’s such a heartwarming story about success, and inspiring to anyone who is passionate about a skill and contemplating starting a business to focus and perhaps make a living.

AllParenting notes that she and her shop has garnered the attention of celebrities, making the shop an overnight sensation. Mary took an activity she loved and for which she had a talent, opened a store, and suddenly celebrities were talking about it. Not bad! The story refers to mostly actors who quickly jumped on her team and supported her as happy customers, like Jason Lee (“Earl” from My Name is Earl), Timothy Hutton (“Conrad” from Ordinary People), and Jenna Elfman (“Dharma” from Dharma and Greg).

I don’t want to criticize Mary. She’s done a great job — and congratulations to her on her recent wedding! The story is inspiring, but the interview neglects to focus on the huge advantage Mary has over a typical entrepreneur, tired of his or her job, feeling a pull to do something else with life. Mary had quite a few built-in connections. While she’s an actor and producer in her own right, her sister, Beth Riesgraf, is also an actor (and a talented film photographer). And the business was launched at the height of Beth’s popularity, as her show Leverage was coming to a close and fans were imploring the producers to keep the show running.

In the interview, Mary says, “My sister had tweeted about me and a bunch of our friends re-tweeted… It was explosive!” Today, Beth has 438,000 Twitter followers. I’m not sure how many she had in 2012, but I expect it was a similarly high number. If you want to be an entrepreneur, ask yourself how many Twitter followers your siblings have.

Mary also says about her first celebrity order, “Jason Lee ordered 150 of our Signature Caramel Chocolate Apples for his wedding.” The story of her success would have had less of an impact if she had said, “Jason Lee, my sister’s former fiancée and father of her daughter, ordered 150 of my caramel chocolate apples for his wedding a couple years before I launched my actual business.” Timothy Hutton, also mentioned as a celebrity customer, was Mary’s sister’s Leverage co-star. Sales or gifts, readers aren’t really sure what those orders are, but either way, they’re still in the family.

My intention isn’t to dampen the success of one particular sudden-entrepreneur, but just to show there are often a lot of details missing from our favorite inspiring entrepreneurial stories. This is just an example I came across recently, and one where I happened to know some of the missing pieces.

The problem is that a story like this can easily encourage someone to start their own business. Is that really such a bad thing, when the employment environment today is so bad and it seems to make a lot of sense for people looking for a better financial future to take matters into their own hands? Being a business owner does open lots of opportunities for personal, professional, and financial growth. But you have to do some market research and soul searching first. Don’t be swayed by inspirational stories. Ask questions! Get to the bottom of the issue. Find out why and how people succeed — not just how they say they succeed, because the true story is often much different than the marketing (and every story is marketing).

If you make decisions based on inspirational stories, whatever hard time you thought you had working at “just a job” could be much, much worse, when you find yourself struggling as a business owner. And then years later, when you discover you need to go back to the workforce, you’ll be in further trouble because you haven’t maintained your skills and have a gaping, unsuccessful hole in your résumé. Too many people are willing to be inspirational and motivational, and to be inspired and motivated, and too few people are willing to discuss realities. That just doesn’t sell as well.

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It’s the height of home repair season, a time when established contractors are often in demand and unavailable. That’s a big opportunity for the fly-by-night operators to step in.

Hiring a contractor to do work on your home, whether it’s a relatively small job or a major renovation, is a big deal. For most consumers, your home is your biggest investment. It should be treated with the level of respect that comes along with that.

Just like you wouldn’t want some quack of a doctor to perform surgery on you, you don’t want someone with questionable skills to be operating on your home. On top of that, if you do end up with a shady “contractor” you not only run the risk of poor work you also are taking a chance on getting ripped off.

Scams in the home improvement business have been around for a long time. They’re finely tuned and very focused on getting consumers at their points of maximum vulnerability.

Recognizing how their game is played, however, can help you avoid getting ripped off. And, if you play the role of consumer by the book, you’ll have the best chance at getting the job done properly for a fair price.

What to watch out for

Ideally, you should be seeking a contractor rather than the contractor seeking you. So, when someone comes to your door after spotting some loose shingles, cracks in your driveway, or just about any other problem that could benefit from repair, watch out.

One of the oldest scams in involves the door-to-door approach. They’re looking to do two things: tempt you with their immediate availability and get a commitment from you without giving you the benefit of thinking things through or reviewing your options. More than likely they’ll also dangle a price that’s too low to believe. Unfortunately, for many victims, that combination can be irresistible.

You should try to resist, however, because the very next thing after you say you want the work done is you’ll be asked for money. More than likely they’ll ask for cash or, if they take a check, it will be cashed before the job even gets going.

Regardless of whether the contractor looks the part, sounds impressive, or otherwise spins a believable tale, avoid these sorts of spur of the moment decisions. Driveway repair schemes, in particular, are widespread during the spring and summer months. A crew of workers will troll neighborhoods looking for driveways in rough shape and pitch the homeowner that they can do the work then and there on the cheap. Why? Because they claim they have a bunch of asphalt left from a previous job that must be used up. In reality, they drive around with this asphalt and what they want is someone who will lured by the chance of a cheap repaving. The result for the unfortunate people who agree is a scam that involves a demand for more money with the threat of leaving a partly finished job.

How it should work

The simplest way to avoid these contractor scams is to understand the proper way to hire someone to do work on your home. That involves doing a bit of homework and taking the time to screen contractors you are considering hiring.

Recommendations are not the final word, but a place to start. Many jurisdictions license or register contractors. It is vital that consumers make sure a contractor they are considering is properly licensed or registered with the state, county, or municipality where the work is to be done. That’s a way to avoid fly-by-night outfits and typically means the contractor has at least a minimum of amount of insurance so you don’t get left holding the bag if something goes awry. (Here’s a list of state and local consumer agencies by state that can help you track down the rules where you live.)

Check with the agency that licenses or registers contractors- or your state attorney general – to see if many complaints have been filed against any company you are considering. Look on the Better Business Bureau website, as well.

Invite at least three contractors to provide detailed estimates of what they think the work should cost. Getting estimates should be free. At their visit, ask to see their liability and worker’s compensation insurance (if they have anyone working for them). Be sure to ask them to be specific on their estimates, including any particular materials they might use (the brand of window, for instance, if they’re replacing windows). Ask what the estimate includes and does not include. Check if permits will be needed for the job and if they will be getting them. A reputable contractor will play by the rules and take care of those sorts of details. Failure to get a required permit could result have serious consequences for the homeowner.

Always ask when payments are due. Payments should be incremental, starting with a small deposit, followed by percentages of payment made after certain milestones are reached, with the last payment of, say, 25 percent, being withheld until the work is completed to your satisfaction.

The lowest price is not always the best deal. Pay attention to how the various contractors communicate with you, how thorough their estimates are and how inclusive. A shady contractor will offer a low-ball estimate to entice a customer and later jack up the prices. You want to hire someone with an established track record, references you can check, who understands what they’re doing.

It takes more time and more thought, but playing it safe will help you dodge the worst of the worst and avoid home improvement ripoff.

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How to Win the War Between Consumers and Creators

by Luke Landes
Consumer

As the title implies, there is a war between consumers and creators, and the battles in this war are played out with money. It’s a war I’ve been seeing from both sides of the trenches. I am a consumer, but more than that, I’ve been writing and thinking about consumer behavior from an empowerment perspective ... Continue reading this article…

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Home Grocery Delivery: Peapod vs. FreshDirect

by Luke Landes
FreshDirect

Although I don’t take advantage of this type of service every time I need to go food shopping, grocery delivery is one luxury I enjoy about once a month. I’ve been a customer of Peapod for about eighteen months. Peapod is a company associated with Stop & Shop, a supermarket in my area. The food ... Continue reading this article…

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Boycott Wal-Mart on Black Friday and Thanksgiving?

by Luke Landes
Black Friday

Someone I know is boycotting Wal-Mart. I would not be able to boycott Walmart myself, as I never shop there in the first place. My absence from Wal-Mart does not have any effect. I believe I’ve stepped inside the store twice in the past decade or longer, and I don’t remember why. The basis for ... Continue reading this article…

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Black Friday Deals: Don’t Fall for These Dirty Tricks

by Luke Landes
Black Friday Dirty Tricks

For some reason, this year I’ve been bombarded more than any other year by advertisements for Black Friday deals. The marketing is coming from helpful people who just want to share the good news with their friends, people who are clearly paid to spread the messages, and retailers who simply want people to buy as ... Continue reading this article…

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The Chase Freedom Lifestyle Index: Finding a Story Amid Data

by Luke Landes
Chase Bank

In terms of credit card offers, Chase Freedom is one of the most popular. This is the card that was selected by expert personal financial bloggers to win the Fourth Annual Plutus Award for Best Credit Card Offer, most likely due to its cash back program, a sign-up bonus, and the strength of the Chase ... Continue reading this article…

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Should a Consumer Return a Duplicate Shipment?

by Luke Landes
Unexpected shipment

Day one, there didn’t appear to be a problem. Some time earlier, my girlfriend ordered some clothing online. Either she had received a discount to apply to the order or she would receive a future discount in return for placing the order. I’m not clear on the details of the discount, but it’s mostly irrelevant ... Continue reading this article…

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How to Save Money Without Worrying About Coupons

by Luke Landes
Coupons

The retail industry has everyone fooled. While millions of people spend their time scouring for deals, clipping coupons from the newspaper if they’re old-fashioned, plugging into the latest mobile deal applications if they are somewhat more technologically inclined, sharing their finds on Facebook to recruit friends for group deals, the companies on the other side ... Continue reading this article…

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Subscription Culture: You No Longer Own Anything

by Luke Landes
Dollar sign

Most financial experts agree that if you need a car, buying is almost always a better financial decision than leasing. Even if you have to borrow money for the purchase, traditional financing is a better option than making payments for a couple of years and having nothing to show for it unless you’re willing to ... Continue reading this article…

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How to Order Your Free Chex Systems Report

by Luke Landes
ChexSystems - Free Annual Checking Account Report

Chex Systems is a private database that tracks consumers’ behavior with checking accounts. The company that owns the database, Fidelity National Information Services (no relations to Fidelity Investments), is, among other things, a credit reporting agency. Therefore, customers whose activities have been tracked in Chex Systems have some rights, like customers whose credit is reported ... Continue reading this article…

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Replace the Dollar Bill With the Dollar Coin: The COINS Act

by Luke Landes
Dollar coins

A proposal has been floating around Congress for the past few years, and it should save taxpayers $4.4 billion over the next thirty years. The Currency Optimization, Innovation, and National Savings (COINS) Act would replace the $1 bill with the $1 coin. The $1 coin has been in production and circulation since 2000, with an ... Continue reading this article…

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Elimination of the Payroll Tax Cut Reduced Consumer Spending

by Luke Landes
Consumers Planned Response to Tax Hike

In 2010, Congress passed the Tax Hike Prevention Act, which among other things reduced the payroll tax from 6.2 percent to 4.2 percent starting in 2011. For two years, workers saw higher take-home income than they would have had the law never existed, and consumers responded favorably by using the extra money throughout the two years to ... Continue reading this article…

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The Great Gatsby Backlash

by Luke Landes
Art Deco

I’m looking forward to seeing Baz Luhrmann’s new film treatment of The Great Gatsby. The book, of course, is a seminal piece of American literature, and the new movie is yet another in a long line of interpretations. I like the director’s previous works, and I expect I’ll enjoy the new film. I read The ... Continue reading this article…

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Mint.com Tracks Two Million Users to Create Spending Index

by Luke Landes
National Average Monthly Spending

When staff writer Sasha introduced Consumerism Commentary readers to Mint.com in 2007, I began to think about the power of massive consumer financial data. As more people signed up for this online service that connects directly to users’ credit card accounts and bank accounts, Mint.com, or any other similar services, would be able to analyze ... Continue reading this article…

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8 Scientifically Proven Principles of Happiness

by Luke Landes
Happiness - 8 scientifically proven principles

There is a link between wealth and happiness, but it’s not that having more of the former results in more of the latter. The Journal of Consumer Research published a study involving a scientific analysis of the link between money and happiness designed and analyzed by researchers at the University of British Columbia, Harvard University, ... Continue reading this article…

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Will an Internet Sales Tax Change How You Shop?

by Luke Landes
Internet sales tax - shopping bags

After a rocky beginning to the relationship, I’ve grown to appreciate Amazon.com. For the most part, the online retailer still boasts the best prices, shipping can be free, and if your purchases are delivered to New Jersey or one of several other states, Amazon doesn’t add sales tax to the purchase. Lobbyists that represent all ... Continue reading this article…

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Can Tipping Change a Waiter’s Behavior?

by Luke Landes
Can tipping change a waitress's behavior?

A friend of mine once lamented publicly: “When did the standard restaurant tip change from 15 percent to 20?” Sure, I remember paying typically 15 percent for a tip when I first started dining out with my friends. That was when I gained my first sense of independence from my parents twenty years ago, as ... Continue reading this article…

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