Stephen M. Pollan

You can better cope with money misfortunes if you know in advance the major steps to take. How to handle six common financial challenges…

You can’t pay monthly bills because of unexpected expenses. Take action as soon as the problem becomes apparent. Waiting until payments are past due and collection agencies are involved will only make things worse.

Divide your expenses into three categories…

Expenses that cannot be delayed. Example: Insurance premiums.

Expenses that might be deferrable if the lender agrees. Examples: Mortgage and car loans.

Expenses that are discretionary. Examples: Eating out and new clothes.

First, eliminate all discretionary spending. Second, contact mortgage and auto-loan providers. Explain that you had an unexpected expense and request “forbearance.” Propose a specific payment plan that would make your debt manageable. Mortgage and auto-loan companies do not want to get stuck with your house or car, so they often will be flexible.

Example: A 32-year-old man faced $3,200 in travel and burial expenses after the death of his uncle. His mortgage lender agreed to accept interest-only payments for three months.

You can’t pay a large, uncovered medical bill. Explain your financial situation to the hospital’s or doctor’s billing department, and ask to set up a payment plan that fits your budget. Next, speak to hospital social workers and local family-service charities to see if any grants or loans are available to people in your situation. Ask family members and employers for financial assistance — big companies sometimes have emergency loan or hardship grant money available to help employees.

If you have health insurance but your insurer will not cover the bill, get a specific explanation why. If the insurance company claims a treatment was not necessary, ask your doctor to write a letter stating why it was necessary. There are multiple levels of appeal possible if your first request is denied.

Example: A 58-year-old widow was hit with a five-figure bill when her insurance company claimed that a colon cancer treatment was not necessary. She negotiated a $200-per-month payment plan with the hospital. Then she asked her doctor to write a letter explaining why the procedure was necessary. Her insurer eventually agreed to pay a large portion of the bill. She paid off the remaining debt in less than 18 months.

You’re dropped by your homeowner’s insurance company. Unfortunately, insurers discontinue various policies — especially homeowner’s policies — all the time for all sorts of reasons. Do not bother trying to get the decision reversed — that almost never works — but do make sure you are given the grace period guaranteed by your contract before it is terminated.

Then ask your accountant, attorney or real estate agent to recommend an insurance broker. Unlike insurance agents, insurance brokers work with many different insurance companies and can help you find the best rates. They often have access to better policy information than you can find quickly online.

The policies available to you might be considerably more expensive than your old coverage. Ask your broker for cost-cutting strategies. Increasing the size of copayments and deductibles often can dramatically reduce premiums. Increase the size of your emergency fund as well, in case you need to pay a large deductible later.

A parent dies with bills outstanding. Carefully go through your deceased parent’s papers, and construct a list of assets and liabilities. Keep an eye peeled for any life-insurance policies or evidence of safe-deposit boxes. (For example, the check register in your parent’s checkbook might list ongoing payments to an insurance company or a bank.) Destroy credit cards, and cancel the accounts.

When bills arrive, write “deceased” on them and send them back, with a copy of the death certificate. If bill collectors call, explain that the estate will deal with the deceased’s debts once the funds are in the executor’s control. Repeat this as often as necessary.

Surviving family members are not responsible for a deceased parent’s debts (unless the debt stems from a joint account with a surviving spouse or family member).

Some debts will have to be paid out of the parent’s estate, but waiting until that stage will at least allow you to sort out financial obligations first. Secured debts, such as auto loans signed by only the deceased, that are not paid off by the estate will result in repossession.

Your adult child needs financial help. First consider your own finances. Would solving your child’s financial problem create a financial problem for you? Would it significantly affect your retirement plans?

If you are considering making a loan, rather than a gift, calculate how your finances would be affected if this loan were not repaid. Many loans to relatives never are repaid.

If you cannot afford to make the loan, explain to your child that you love him/her but cannot give money that you do not have to spare.

If you decide to help, first insist on having a conversation with the adult child about budgets, spending and saving. Explain what he needs to do differently from a financial standpoint. Next, determine exactly how large a gift or loan he needs to make ends meet, and how much you can afford to give.

Make it clear that this is a onetime loan or gift, not an ongoing line of credit. If the gift is sizable, inform your other children that the gift will be taken into consideration when you divide your assets in your will. This will prevent concerns about inequity.

Important: Deciding whether to assist your adult child financially could drive a wedge between you and your spouse. Agree in advance to make this decision as a team.

You lose your job. If your employer insists that you sign a release form in order to receive your severance package, don’t do it right away.

It often is possible to get better severance terms through negotiation. These negotiations can be quite simple — whatever the company offers, ask for more.

If you have a good relationship with someone high up in your company, ask that person to put in a good word for you with the human resources department regarding your severance package. Insist on credit for unused vacation days and a prorated portion of any annual bonus.

Ask if you can keep your company car and/or laptop until you find a new job. Request continuation of health-insurance benefits. If continued benefits are not available, see if you are eligible to continue coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), the program that allows former employees to pay out of pocket to continue their benefits for up to 18 months. COBRA coverage may be expensive, but it can be a vital bridge until you arrange other coverage.

Determine how long you can continue paying your bills out of your savings and severance pay, and decide what resources you will tap next if you have not found another job by the time this money runs out. Will you liquidate investments? Borrow from family members?

If need be, consider taking a job that you normally wouldn’t to keep money coming in, even if it has no connection to your previous experience. Sometimes these “emergency jobs” lead people into other career directions.

Don’t worry that your emergency job means you will have to schedule future job interviews around your work schedule — most interviewers consider it a good thing when job applicants are working.

Bottom Line/Personal interviewed Stephen M. Pollan, a New York City–based attorney, financial adviser and career counselor. He is a former assistant professor of finance at C.W. Post School of Business and former CNBC on-air personal finance expert. He is coauthor of several books, including Die Broke: A Radical Four-Part Financial Plan (Collins) and Lifelines for Money Misfortunes: How to Overcome Life’s Greatest Challenges (Wiley). http://www.stephenpollan.com.

But we will not accept any interference in our affairs. You have been notified.

Mike

Thank you for speaking the truth. The fact is the US military is attempting to turn Gum in the the whorehouse they made of the Philippines. They would subject our women to the sexual manipulation and abuse they forced upon the female women and children of the Philippines.

Already the leaders of Guam are showing that they are more than willing to prostitute their females for a few dollars more.
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Vice Speaker Proposes Adult Entertainment District

Guam – Responding to requests from Guam’s visitor industry organizations, Vice Speaker B.J. Cruz introduced Bill No. 314-30 that would establish adult entertainment zoning outside of Tumon’s “Hotel ROW.”

The bill provides that adult entertainment establishments may be operated only in areas zoned MI or M2, the zoning for light and heavy industrial uses. If enacted into law, Bill No. 314-30 would allow existing establishments up to five years to continue operations in Tumon or any area not zoned MI or M2.

This bill comes at the behest of the Guam Visitors Bureau, the Japan Guam Travel Association, and the Guam Hotel and Restaurant Association, which expressed to the Vice Speaker growing concerns over obscene signage and aggressive street-marketing tactics of adult oriented businesses.

Passage of such rezoning legislation is a part of GVB7s Five-Year Strategic Plan.

The Vice Speaker was first approached in March then again in August of last year to introduce the bill on the organizations’ behalf. After much consideration the Vice Speaker introduced the measure essentially in the same form as the draft bill submitted to him by industry organizations.

“I was initially apprehensive about introducing this bill when it was first brought to my Committee’s attention,” Vice Speaker Cruz said, “but after review of the military buildup DElS and four DElS meetings, it became clear that the San Vitores Road area must be protected for both our local families and for the visitors that come here to enjoy the family destination Guam
is purported to be.”

According to the Vice Speaker there are currently about 55 adult entertainment establishments operating along or just off of San Vitores Road
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Try establishing legalized zones of prostitution in the states and you will hear the howl of indignation. The hypocrisy of the bastards knows no end.

Peter

The right is gathering foam from the mouths of their followers by predicting the win of the Massachusetts special election for the Senate.. Of course they are asking for donations. I think it is proper that the sick bigots should be fleeced.

Oh, and Carl, I am white too. But when my race or any other race shows the kind of depravity mentioned in this blog, they should be called out. And I would prefer calling these racists biggots as rhymes with maggots. You get the picture.
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Carl if you can’t see the wrongs practiced by this groups, you can’t be helped. So pissing you off is pointless.

Mike

Now they are trying to allow corps to pollute the planet for a few dollars more.
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Dear MoveOn member,
Earlier this week, we learned that the Senate is about to vote on a bill to block the Clean Air Act’s limits on global warming pollution.
Now, it’s been discovered that the sponsor of the bill, Alaska Senator Lisa Murkowski, received nearly $250,000 in campaign contributions from the electric utility industry last year—and let one of the top utility industry lobbyists literally write the bill to roll back the Clean Air Act.1
Can you call Senator Dianne Feinstein? Tell her to vote no on the Murkowski amendment to block President Obama from enforcing the Clean Air Act’s limits on global warming pollution.
At stake is a crucial section of the Clean Air Act that requires limits on global warming pollution. If the Murkowski Clean Air Act rollback passes, nearly all the progress that President Obama has made on global warming would be overturned.2
Ethics watchdogs like the Center for Responsibility and Ethics in Washington, Public Citizen, and the Alaska Public Interest Research Group have raised serious questions about the appearance of corruption in the writing of Sen. Murkowski’s bill.3
Sen. Murkowski is the top recipient of campaign donations from the electric utilities in the entire Congress, and former Bush administration official Jeffrey Holmstead is one of their top lobbyists.4 Two of Holmstead’s biggest clients—Southern Company and Duke Energy—are among Sen. Murkowski’s top contributors.5 And Federal Election Commission reports show that PACs for six other Holmstead clients and Holmstead’s lobbying firm pumped money into Murkowski’s campaign as well.6
“This is the sort of pay-to-play politics that makes Americans so suspicious of our elected leaders,” said Melanie Sloan, Executive Director of the Center for Responsibility and Ethics in Washington.
We can stop this, but we have to fight back now. Please call Senator Dianne Feinstein and tell her to vote no on the Murkowski amendment to block President Obama from enforcing the Clean Air Act’s limits on global warming pollution.
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We need to contact our representatives on this one.

Janet