Gunning Daily News

Word of the Day

September 11, 2012 5:58 pm

Special assessment. A special tax imposed on specific parcels of real estate that will benefit from a proposed public improvement, such as a street or sewer.

Q: What If My Contractor Bungles the Job?

September 11, 2012 5:58 pm

A: If you have a legitimate complaint, keep after the contractor until the needed repairs or alterations are made. If this fails, contact your local Consumer Protection Agency. Keep a copy of the contract, receipts, and photographs of the work. Although it has no legal authority, you also may want to contact the Better Business Bureau, as well as your state’s Contractor License Board. And you can take the contractor to Small Claims Court, although the amount you would be able to recover varies from state to state. California, for example, allows judgments up to $7,500. It’s $5,000 in Virginia and less in other jurisdictions.

10 Tips to Ensure Your Air Conditioner Is Ready Next Year

September 10, 2012 5:50 pm

With the arrival of fall, many are turning off their cooling systems. But how can you make sure yours is ready to jump back into action next year? With the rising costs of fuel and the uncharacteristically hot summers throughout the U.S., it is more important than ever to extend the life of your home’s air conditioning unit. A high-quality heating ventilation and air conditioning system can last up to 20 years if properly installed and maintained. However, the cheapest models or poorly maintained systems can fail in as little as five. Here are 10 tips to make sure your air conditioner is ready for next year.

1. Make sure all weather stripping around doors and windows is properly sealed. As time goes by the caulking and weather stripping become compromised with use and temperature changes and the loss of the conditioned air can cause the air conditioner and heater to work longer to achieve the desired temperature.
2. Screening AC installers for professional credentials, experience and proper training is extremely important. If the unit has been installed improperly, the system may have leaky ducts or low air flow. Often, the level of refrigerant does not match the manufacturer’s specifications, which can affect efficiency and performance. Improper installation can lower a system’s efficiency by up to 30 percent.
3. Changing or cleaning the air filter is one of the most important maintenance tasks. Clogged, filthy filters obstruct air flow and can even impair the evaporator coil’s ability to absorb heat. Filters should be attended to every month or two, depending on how much dust or pet fur a home has. A good contractor will show homeowners how to do this simple task themselves.
4. It is important to keep an eye out for warning signs of a failing system, such as: loud or strange noises, a system that turns on and off a lot, longer run times, strange smells emanating from the unit, or higher than normal energy bills.
5. Installing and using a programmable thermostat is a great way to improve the longevity of central air. This enables homeowners to pre-program the unit to turn off while they are away from the home or increase in temperature. Energy Star studies say a programmable thermostat can save homeowners about $180 a year in energy costs.
6. Sealing and insulating ducts can improve a cooling system’s efficiency by 20 percent or more. Often ducts that run through attic crawl spaces, basements and garages become extremely hot during the day, which causes the air conditioner to work harder to cool these surfaces. Also, poorly sealed ducts can leak cool air outside of the home and waste energy.
7. Buying high-performance AC units with Energy Star labels and high SEER numbers will not only ensure greater longevity for the system, but can also decrease cooling costs by nearly $500 a year. Upfront cost should not be the only consideration in choosing a system for the home.
8. Getting adequate airflow through the outdoor condenser coils is important as well. Homeowners should periodically check outside to ensure there are no weeds, shrubs or other obstructions. One can also turn off the circuit breaker to the unit, remove the outdoor cabinet and clean out debris that has accumulated inside. Many people hose down the unit after every lawn mowing to keep grass clippings out.
9. Keep pets away from the condenser. It may sound crazy, but it’s not at all uncommon for a system to fail in 5 years due to a pet using the bathroom on the unit and corroding the cooling coil fins’ metal.
10. Annual maintenance scheduled regularly is the best way to ensure the whole system is operating properly. A technician will top off fluids, check electrical connections for safety, clean and lubricate all moving parts, change the filter, adjust blower components for comfort, and inspect the system for signs of wear and tear.

Source: Air Depot

How-To: Build a Strong Retirement Plan If You’re an Entrepreneur

September 10, 2012 5:50 pm

According to a recent report conducted by The American College, 40 percent of small business owners have no retirement savings or pension plan in place. Furthermore, the study found that three-fourths of those owners have no written plan as to how they intend to fund their retirement.

Small business owners know the value of a solid business plan. Unfortunately, too many of those entrepreneurs neglect to place the same effort in planning for their retirement. Business owners focus so much on growing and maintaining their business, that often their own retirement is put on the back burner.

"It's important to have personal retirement savings outside of your business because the value of that business can fluctuate significantly over the years," says Brad Smith, Kansas City President, M&I, a part of BMO Financial Group. "Additionally, having a retirement nest egg is important should the unexpected arise, such as a major health issue or needing to sell the business sooner than expected."
Below are some tips for small business owners on how to effectively save for retirement:

Take care of yourself - Invest in yourself, not just your business. As a small business owner, the instinct is often to invest back into the business. However, it is very important to pay yourself as well, especially when planning and saving for retirement. Relying on selling the business to fund retirement can be a risky approach that does not always work.
Invest in an IRA and SEP – Having a diversified financial plan, including both an IRA and SEP, is a great way to accumulate wealth outside of the business. Investments in these plans grow faster due to tax-deferred compound growth, and IRAs and SEPs with conservative holdings are effective during times of instability, offsetting the volatility of business returns. SEPs can provide great tax benefits by reducing the owner's taxable income.
Team of experts – Surround yourself with a group of experts, including a financial professional who specializes in small business, an accountant, a tax specialist and a lawyer. They can offer sound advice and provide insight on how to build your retirement savings independently of your small business. A financial professional can also help develop a detailed financial retirement plan that outlines your goals and progress.
Explore other investment options – Consider other investment strategies that will help build your retirement savings like investing outside of your IRA and SEP. It is also important to take precautions against the unexpected, like an illness or disability, by considering life and disability insurance.

As with any investment, you should consult with a tax advisor to determine what works best for your personal goals and financial situation.

"Although it's tempting to concentrate solely on investing in their business, small business owners owe it to themselves and their family to have personal retirement savings to help ensure a comfortable retirement," says DiVito.

Source: BMO Harris

Financial Tip of the Week: Improve Your Credit Score

September 10, 2012 5:50 pm

Just like a top football, basketball or hockey player is drafted based on their stats, your credit score is used to determine your financial fitness.

Your credit score is the best way to define your ability to handle debt. It's based on several aspects of your financial picture and can help creditors determine if you're responsible with your money.

Improving your credit is one of the easiest ways to improve your overall financial scorecard. Doing so may help you get approved for loans and lower your interest rates and insurance premiums.
The following steps can help you improve your credit score:

Pay on time. Payment history is one of the most important factors used to calculate your credit score, so consistently paying on time is one of the easiest ways to boost your score. To help you pay on time, consider enrolling in an e-bill pay program that will make payments automatically on your behalf and guarantee they arrive on time.
Reduce debt-to-credit ratio. Focus on paying down the amount you owe on your credit cards so each one has an available credit of at least 50 percent. Doing so improves your debt-to-credit ratio and in turn will improve your credit score.
Use more than one type of credit. Your score is built around both revolving (ex. credit card) and installment (ex. mortgage loan) credit. Having both types in your credit history shows you can responsibly handle multiple kinds of credit, and in turn may improve your score.
Stick with the accounts you have. Opening new accounts means new inquiries on your credit report, which may lower your score. On the other hand, avoid closing accounts you already have, even if you don't use them that often. Doing so can negatively impact your debt-to-credit ratio and credit history – both of which are used to calculate your score.

Source: BMO Harris Bank

Word of the Day

September 10, 2012 5:50 pm

Settlement. The day on which title is conveyed.

Q: If Faced with Foreclosure, What Are My Options?

September 10, 2012 5:50 pm

A: Talk with your lender immediately. The lender may be able to arrange a repayment plan or the temporary reduction or suspension of your payment, particularly if your income has dropped substantially or expenses have shot up beyond your control. You also may be able to refinance the debt or extend the term of your mortgage loan. In almost every case, you will likely be able to work out some kind of deal that will avert foreclosure.

If you have mortgage insurance, the insurer may also be interested in helping you. The company can temporarily pay the mortgage until you get back on your feet and are able to repay their “loan.”

If your money problems are long term, the lender may suggest that you sell the property, which will allow you to avoid foreclosure and protect your credit record.

As a last resort, you could consider a deed-in-lieu of foreclosure. This is where you voluntarily “give back” your property to the lender. While this will not save your house, it is not as damaging to your credit rating as a foreclosure. Exhaust all other viable options before making a decision.

Protect Yourself with The Latest Consumer Fed Data (Part1)

September 7, 2012 2:40 pm

I took note that credit and home repair and construction concerns once again topped the list of complaints made to state and local consumer protection agencies. This is according to a survey by the Consumer Federation of America (CFA) and the North American Consumer Protection Investigators (NACPI).

Thirty-eight agencies from across the United States provided information about the most common, fastest-growing, and worst complaints they received in 2011. They were also asked about new types of consumer problems, and what new laws are needed to better protect consumers.

The data helps consumer protection agencies follow trends in fraud, educate the public, and share information with each other, which will ultimately assist in investigations according to Tonya Hetzler, Interim President of NACPI.

Some key findings in the latest Consumer Complaint Survey Report include:

The top five fastest-growing complaints were about fraud, debt collection abuses, Do Not Call violations, mortgage-related problems, and home improvement.
The top five worst complaints involved mortgage-related problems, home improvement, timeshare sales and resales, Internet sales, and fraud.
New types of consumer problems that agencies dealt with last year covered a wide spectrum of subjects, from bedbugs in apartments to penny auctions on the Internet, from gold buying companies to telemarketing and mail solicitations for home repairs disguised as “free” energy audits. Some agencies also noted that scammers are exploiting a new form of payment, prepaid card products, to get cash from consumers.
Budget cuts and limited resources were most frequently cited as the biggest challenges that state and local consumer protection agencies faced last year. Another major challenge was the evolving nature of fraud and the fact that many scammers are located in other countries, complicating efforts to resolve complaints.

In the next couple of segments, we'll drill in to some of these consumer issues that could affect home and property owners, or those looking to become one in the near future. See the entire report now at consumerfed.org.

Protecting Your Home against Winter's 'Silent Killer'

September 7, 2012 2:40 pm

(ARA) - It’s colorless, odorless and the No. 1 cause of accidental poisoning in the United States. And, it worsens in the winter.

Known as the “silent killer,” carbon monoxide (CO) is responsible for an average of 450 deaths and 20,000 emergency room visits each year, according to the Journal of the American Medical Association. With more than two-fifths of all CO poisonings occurring between December and February, homeowners are at increased risk once temperatures begin to drop.

“During the winter months, many families turn to heating sources they might not use at other times of the year,” says Deborah Hanson, director of external affairs for First Alert, the most trusted name in home safety. “While these heating sources may be effective at providing warmth, they also can pose great risks if not used properly. To help protect loved ones from the dangers of CO poisoning, it is important for homeowners to take proper precautions when dealing with any kind of fuel-burning heat source.”

First Alert recommends the following tips and tools for keeping your home and loved ones warm – and safe – this winter and all year long:

Protect against CO poisoning
Run kitchen vents or exhaust fans any time the stove is in use. The kitchen stove is among the most frequent sources of CO poisoning in the home. To help eliminate danger of overexposure, never use the oven to heat a home. Always run exhaust fans when cooking, especially during the holidays when stoves are left on for longer periods of time. Also, open a nearby window periodically when cooking to allow fresh air to circulate.

Never use generators indoors. In the case of a power outage, portable electricity generators must be used outside only with power brought into the structure with a cord. Never use them inside the home, in a garage or in any confined area that can allow CO to collect. And be careful to follow operating instructions closely. Also refrain from using charcoal grills, camp stoves or other similar devices indoors.
Have fuel-burning appliances inspected regularly. Arrange for a professional inspection of all fireplaces and fuel-burning appliances – such as furnaces, stoves, clothes dryers, water heaters and space heaters – annually to detect any CO leaks.

Be mindful of the garage. Warming the car in the morning before work is common during the winter months, but running vehicles inside an attached garage, even if the door is open, is hazardous, as CO can leak into the home.

Install/test CO alarms. Carbon monoxide alarms are the only way to detect this poisonous gas in a home. For maximum protection, alarms should be installed on every level of the home and near each sleeping area. Test alarm function monthly and change batteries every six months. In addition, alarms should be replaced every five to seven years to ensure proper function. If the installation date is unknown, replace immediately.

For more information on carbon monoxide safety, visit www.firstalert.com.

The New Appeal of High-Yield Bond Funds

September 7, 2012 2:40 pm

(ARA) - With short-term interest rates at historic lows, many investors are turning to “high-yield” bond funds to generate more income from their investment portfolios. They could make sense for you, too.
High-yield bonds are bonds issued by companies that do not carry investment-grade credit ratings. These companies often have higher-than-average levels of debt, suggesting that they are at greater risk of defaulting on their obligations to bondholders. To reward investors for taking that risk, companies pay higher rates of interest on their bonds. In late August, for example, when intermediate-term corporate bonds from investment-grade companies were yielding about 2.4 percent, high-yield bonds were offering about 7 percent.

Despite this riskier profile, high-yield bonds historically have had a relatively low default rate – about 4.4 percent annually, on average, over the past two and a half decades. For the first six months of this year, with corporate profits strong, the default rate was only 2.5 percent.

A mature marketplace
The market for high-yield bonds is larger and more diversified today than it was a few decades ago, when these securities were often referred to as “junk bonds.” It is now a $1 trillion-plus marketplace featuring bonds from companies in a wide range of industries, and broadly diversified in terms of credit quality. Rating agency Standard & Poor’s has a dozen different rating levels for high-yield issuers, ranging from “BB+” for those one notch below investment grade to “D” for those that have already defaulted on some of their financial commitments.

This diversity in today’s high-yield marketplace makes it easier for investors to manage default risk, since they can build portfolios of bonds in various industries and maturities across the credit spectrum.
Although high-yield bonds can fall in value when the economy weakens and investors start to worry about getting paid, those at the top of the ratings scale tend to fall the least. And they usually fluctuate less dramatically than stocks. In fact, research by Thrivent Financial analysts has shown that over the past 25 years the total return on high-yield bonds has been about equal to that of the Standard & Poor’s 500 Stock Index, but with only about two-thirds of the volatility.

“There are risks to investing in the high-yield market, just as there are risks in any market,” says Mark Simenstad, vice president and head of fixed-income funds for Thrivent Financial for Lutherans, a diversified financial services organization. “But it’s not a monolithic market. Many of the higher-quality bond issuers are established, well-known companies with good business prospects, which wasn’t always the case 20 or 30 years ago.”

Investing prudently in high-yield bonds
Beyond focusing on credit ratings, one of the simplest ways to minimize the risk of investing in high-yield bonds is through diversification. Instead of buying one bond, investors are encouraged to buy several issued by different companies in different industries. That way, one default can’t take down the entire portfolio. They also can incorporate other high-yielding assets into their holdings, including preferred stocks, convertible bonds and even mortgage-backed securities.

Unfortunately, assembling a diversified high-yield bond portfolio can be a tall order for many investors, who often don’t have the time or resources to assess the financial health and business prospects of many different issuers. Accordingly, most choose to invest via mutual funds specializing in that sector of the market, delegating security selection and trading decisions to a professional money manager.

Paul Ocenasek, manager of the Thrivent High Yield Fund, says high-yield bond funds can be appropriate for several types of investors. “They can certainly make sense for anyone looking to generate income from their investment portfolio,” he says, “since the yields they offer are often higher than what’s available from investment-grade corporate bonds, and typically higher than the yields on conservative cash investments.”

To be sure, high-yield bonds are not risk-free. They can go down in value when interest rates rise or when business conditions deteriorate and market sentiment sours. And, as noted, they can fall into default. But, Simenstad stresses, while investors should not ignore the risks associated with high-yield bonds, neither should they exaggerate them. A prudently managed high-yield bond fund, he maintains, can play a meaningful role in almost any broadly diversified investment portfolio.

Source: Thrivent Financial