Gunning Daily News

Most Americans Are without a Financial Back-up Plan

July 22, 2011 3:27 pm

If the unexpected happens and a major life crisis occurs, most Americans today would be unprepared to handle the impact. These findings are detailed in the new State Farm® "Financial Plan B" survey. In the study, while 81 percent of all adults say having a back-up plan is very important, only 45 percent say they've actually planned ahead and are ready to weather a life crisis. 

"People naturally think the unexpected happens to somebody else. But setbacks can hit anyone and people need to be ready. Regrettably, most are not," says Joe Monk, senior vice president and chief administrative officer, State Farm Life Insurance Company. "With the economic downturn and concerns about continued slow growth, it's critically important that people take a clear-eyed look at their financial situation and develop realistic options they can have in place should unexpected financial difficulties pop up." 

The survey also shows that the pressure to have back-up plans is intensifying because whatever "rainy-day funds" people once had are now challenged in the wake of the economic downturn. In the survey, 35 percent of Americans say they have funds on hand to meet financial needs for just three months or fewer, with 15 percent lacking funds to meet commitments beyond a single month. Not surprisingly, in the event of a job loss, many respondents say they would accept a large salary reduction simply to restore household cash flow. Fifty-four percent indicate they would accept a lower paying job if they were out of work for six months or fewer. 

The telephone survey, conducted for State Farm by Harris Interactive®, asked people to consider their financial readiness in the face of a major life crisis such as loss of a job, a divorce, the unexpected death of a spouse or partner, or a catastrophic illness that leaves someone unable to earn an income. The survey was conducted from May 6, 2011 to May 16, 2011 among a nationally representative sample of 2,017 U.S. adults aged 18 and older. 

Not Ready, Not Realistic
The survey also found that many people may have a false sense of security when it comes to the adequacy of the plans they have embraced to prepare for the unexpected. In the survey, 69 percent say they feel well prepared or somewhat prepared in the event of a major life crisis. Yet in looking at the actual elements of people's back-up plans, many "go-to" options create just as many problems as they solve. 

• Sixty-one percent indicate they would take money from a 401(k) or other employer-sponsored retirement savings vehicle as part of their Plan B. Thirty-four percent would downsize their home and 22 percent would move in with family.
• Sixty-eight percent of people 55 or older say it is likely that they would take on an additional job if necessary.
• Fifty-eight percent of adults who have a financial back-up plan say it is not written down and only exists in their heads.

"For many people, their current Plan B's don't provide the kind of safety net they ultimately need," says Monk. "Taking money from a 401(k) creates more vulnerability later in life, homes are not the piggybanks they once were, and not all people are in the position to take in extended family.
"Working multiple jobs also is not realistic for many Americans as they age," adds Monk. "Most sobering is the fact that most people don't have back-up plans that are written down and documented, which means they often come up with solutions in the midst of a crisis—seldom the best time for clear, stress-free thinking." 

Plan A's Suffering Too
The survey indicates many assumptions about retirement once thought to be unshakable also are coming under pressure. When asked, just fewer than a quarter of future retirees think they will be able to retire at age 60. Nearly one-quarter doubt they'll ever be able to retire. Additionally, slightly more than six in 10 Americans say they will not be able to retire without Social Security and/or Medicare being available as they exist today. 

Given these rising uncertainties, State Farm recommends people consider the following tips to ward off the damaging effects that unexpected life events can have on savings and retirement plans: 

• Start the conversation with loved ones. Financial planning conversations can be difficult and uncomfortable, but it's important to start them before you're faced with a crisis. Planning ahead for the unexpected can alleviate some of the stress you would otherwise experience.
• Work with someone you trust. Talk to your insurance agent or financial advisor about your Plan A—and your Plan B. If you don't know where to turn, ask your friends or family members to recommend someone they trust.
• Put your plan in writing. By committing a step-by-step plan to paper, you can prepare in advance and make more rational choices. And if something unexpected happens to you, others will know your wishes.

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Word of the Day

July 22, 2011 3:27 pm

Contract. A legally enforceable agreement between two or more parties. To be valid, a real estate contract must be dated, in writing, include a consideration, have a description of the property, the place and date of delivery of the deed, and spell out all terms and conditions that were mutually agreed upon. It also must be executed (signed) by the buyer and seller.

Question of the Day

July 22, 2011 3:27 pm

Q: Why do most homebuyers prefer a fixed-rate mortgage?

A: Long-term, fixed-rate mortgages are preferred by most homebuyers because they offer security and stability. The interest rate does not fluctuate over the life of the loan, so the total amount of principal and interest always remains the same. The monthly payment can change, however, if local property taxes, which are normally part of the monthly mortgage payment, increase.

Because the life of a fixed-term loan is usually long – anywhere from 15 to 30 years – you have plenty of time to repay it and there is no call provision written into the mortgage. A call allows the lender to demand the balance of the loan be paid in full before the actual payoff date.

On the negative side, the interest rate on a fixed mortgage is usually two or three full points above the current rate on an adjustable rate loan, at least initially. But for buyers seeking security, the comfort of knowing what their payments will be year after year, and no plans of selling their home in the foreseeable future, this is a small price to pay. If rates drop, they may be able to refinance their home loan and get a lower rate.

5 Ways to Achieve a Stress-Free Vacation

July 22, 2011 2:27 pm

A stressful vacation should be an oxymoron. But, for those of us who are traveling with a large family, running behind on packing, or have seriously overstuffed our itinerary—again!—sometimes we need to remember to breath. The following 5 tips will ensure a more relaxing vacation, whether you’re traveling abroad or making a short local trip.

1. Plan ahead. There are some things that can be done way ahead of your trip, like making reservations, taking the car for a tune up, and letting neighbors know you will be away. Even packing can be done earlier than most people think. Getting your bag ready on Tuesday for your weekend at the lake will be less stressful than packing it on Friday, with your family in the car honking the horn. Most items you will be taking—bathing suit, casual clothes, reading material—won’t be used in the preceding few days anyways. Leave a little room in your bag to add your toiletries last-minute before heading out the door scramble free. 

2. Delegate. Scrambling around to get everything ready for your trip? Dole out tasks to lighten your load. Tell your kids to clean out the car before piling in for that road trip. Ask your teenager to look up good restaurants in the area you’re staying. Have your husband or wife contact the kennel to make reservations for your four-legged friend. 

3. Unplug—everything! Leave your laptop at home, turn off your blackberry and stow away your iPod. Designate 20 minutes a day for catching up with work related emails only if necessary. We are so focused on technology today we forget what it is like to be away from it. While at first you might feel, well, naked, after a few hours of connecting with your family, friends, or just nature, you will feel liberated and care-free. Your emails will be waiting for you when you get home.

4. Do nothing. Pencil in time to do nothing. Whether this is two days on your weeklong vacation, or an afternoon of a long weekend, section of a block of time where you have nothing planned. This will allow you to plan your activities based on how you feel at that moment—a true luxury in this fast paced world.

5. Smile. This may seem like a given, but often we get hung up on the small stuff-even while on vacation. Don’t freak out if a friend bails last minute, or your hotel room is smaller than it seemed in the picture, or you forgot to pack your kid’s bathing suit. When you look back on your trip, these inconveniences will be forgotten, so don’t let them ruin your time in the moment, either.

Basement Flooding, Debunked

July 22, 2011 2:27 pm

Most basements will suffer some form of basement flooding at some point in their life, simply due to their location as the lowest point in the home. So property owners who have basements should assume that it becomes a matter of "when" and not "if" basement flooding will occur. 

Basements are natural attractions for water and flooding, due primarily to their low lying locations, coupled with the fact that water prefers to run downhill. Torrential rains, flash flooding, burst pipes….no matter the source, Ground Zero in the home will be the basement or whatever the lowest level in the structure may be. 

Waterproofing a basement is a futile effort, since water will find a way in if there is enough of it and enough force behind it. What can be done however, is take steps to minimize the effects of basement flooding through the relocation of furniture, appliances, and valuables to higher levels. Even the relocation of power outlets and electrical boxes can serve as preventative water restoration. A visit to a local emergency management office can provide detailed information about past flood events, allowing homeowners to determine how much water they may have to deal with and making preparations accordingly. 

In the event that the basement is the target, it is important to begin water restoration procedures as soon as possible. This will prevent any additional or long term damage to either the basement or valuable possessions. Water restoration involves the removal of the excess water from the property, and the complete drying of all affected surfaces. Failure to dry everything out may result in problems such as mold, or mildew which can be long lasting and prove difficult to get rid of. 

Water restoration as it relates to basement flooding can be a precipitous process. If the water is standing several feet deep, it can become dangerous to pump all of it out too quickly. Doing so may result in sudden pressure changes, putting undue stress on the foundational walls and making them prone to crack or collapse. Water levels should be decreased at the rate of about a third a day to be safe.
Once the excess water has been removed, surfaces will still be wet to the touch, due to moisture being retained by carpet, flooring, even concrete. It will be necessary to remove all residual moisture from these surfaces as well as the surrounding air. Fans, air movers, blowers, and dehumidifiers may be used for this purpose. This part of the water restoration process may take a period of hours or even days to complete. When it comes to basement flooding issues, no stone should be left unturned.
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Tiny Threats: Ticks Pose Serious Health Hazards

July 22, 2011 2:27 pm

Summer is the time for hiking, gardening, picnicking, and simply enjoying the great outdoors. It is also prime tick season—which means increased exposure to the serious infectious diseases they carry.
“According to the New York Department of Health, ticks are most active late spring through mid-August,” says Lou Paradise, president and chief of research of Topical BioMedics, Inc., Rhinebeck, NY, the makers of the Topricin line of natural pain relief and healing creams. “Now is the time to avoid contact with them and be aware of the symptoms of Lyme and Babesiosis, two dangerous tick-borne illnesses. 

The Lyme disease bacterium (Borrelia burgdorfen) is carried by a group of closely related species of ticks known as Ixodes. Ticks in this group include deer ticks, western black-legged ticks, and black-legged ticks. These tiny terrors are small—typically no larger than a poppy seed—and transmit the bacteria when feeding on warm-blooded hosts, including mice, deer, dogs, and humans. The bacteria enter the skin through the bite during feeding and eventually make their way into the bloodstream. 

Lyme disease is named after the town of Old Lyme, Connecticut, where it was first diagnosed among a group of the town’s residents in the mid 1970s. Since then, Lyme disease has affected a growing number of Americans. The Center for Disease Control and Prevention (CDC) reported 23,305 cases of Lyme in 2005, and current statistics now estimates that more than 35,000 Americans contract it annually. Some experts believe the number of cases is much higher, and the CDC has gone on record as saying that they believe only 10-12% of Lyme disease cases are actually being reported to them. Most documented cases have occurred in the Northeast, Mid-Atlantic, and Midwest, with some incidences reported from western states, including Oregon and northern California. . 

The NY Dept. of Health reports that in 60 to 70 percent of Lyme disease cases, the first symptom is a rash that occurs at or near the site of a tick bite and has a round, “bulls-eye” appearance. It can be between 2” and 6” in diameter, and lasts up to five weeks. Other symptoms occur from several days to weeks, months, and even years after a bite. They include “flu-like” symptoms, such as aches and pains in muscles and joints, chills and fever, headache, sore throat, stiff neck, swollen glands, dizziness, and fatigue. Even if these symptoms fade away, untreated Lyme disease may lead to arthritis, nervous system abnormalities, and an irregular heart rhythm. 

Babesiosis is another infection transmitted by ticks and is caused by a parasite that lives in red blood cells. The babesia microti parasite infects and destroys red blood cells, and the disease—which is a malaria-like illness—can cause hemolytic anemia. Symptoms begin anywhere from five days after a bite or longer, and may include fever, chills, headache, muscle pain, nausea, tiredness, and a rash. Unlike Lyme, Babesiosis has been known to be fatal. Therefore diagnosis and treatment should begin as soon as possible after it is contracted. 

The disease was originally documented off the Massachusetts coast, where it was known as “Nantucket Fever.” It is now on the rise and rapidly spreading across the United States. “According to a recent report by the Centers for Disease Control and Prevention, there were six cases of Babesiosis here in the Lower Hudson Valley in 2001,” says Paradise. “There were 119 cases documented in 2008, which is a 20-fold increase. Clearly, we should all take steps to avoid coming in contact with ticks.” 

Tricky Diagnosis 
Because tick bites are usually painless, the incubation period is long, and the symptoms so varied, a tick-borne disease may go unrecognized for weeks or even months.

Moreover, these diseases often mimic other conditions—such as the flu, meningitis, or in some instances Multiple Sclerosis—making it easy for there to be a misdiagnosis. Further complicating matters is the fact that diagnostic tests are not always accurate or conclusive.
Test timing is a factor in diagnosis. According to Sally Hojvat, Ph.D., Director of the Division of Microbiology Devices at the FDA’s Center for Devices and Radiological Health, “It’s important to know that blood tests that check for antibodies to the bacterium that causes Lyme disease are not useful if done soon after a tick bite. It takes two to five weeks for initial antibodies to develop.”
A single tick bite can transmit more than one tick-borne illness—besides Lyme and Babesiosis—such as anaplasmosis, bartonella and tularemia. These co-infections further complicate diagnosis and treatment. 

Tick-borne disease threat doesn’t end when a victim is bitten. There is some history documenting how an individual exposed to these pathogens can pass them through their blood—including from a pregnant woman to her unborn child, and through blood transfusions. In fact, the FDA has reported that over the past 10 years, babesiosis has infected more than 100 Americans via transfusions, and 11 of them have died. Federal regulators are now struggling with how to protect the blood supply because there is currently no efficient test available. 

Prevention and Defensive Measures
Avoiding contact with ticks and disease prevention are the first and best lines of defense against tickborne infections. Here are some tips to help keep you and your family safe from these tiny threats.
Ticks—and disease—are carried by deer, mice, and other common woodland creatures. Keep these uninvited guests away by installing a deer fence and moving brush piles and wood piles (where mice find shelter) and bird feeders (a source of food for rodents) away from your house and play areas.
There are a number of plants you can cultivate around your yard that repel ticks, including lavender, garlic, pennyroyal, pyrethrum (a type of chrysanthemum), sage, American beautyberry, and eucalyptus.
If your lifestyle permits, raising chickens, ducks and guinea hens will help keep the tick population down as these feathered friends have a voracious appetite for them. 

Keep your lawn manicured and avoid walking in wooded, brushy, and grassy areas. When hiking in an overgrown or wooded area, try to stay near the center of the trail. Do not sit on stone walls, where woodland creatures like to live—and which attract ticks. 

Keep in mind that ticks attach easily to bare flesh. When outdoors, protect yourself and your children by wearing long sleeves and long pants, preferably in light colors so you can spot a tick more easily. Wear shoes and socks that you tuck pant legs into or a pair of tall boots. 

Your four-legged friend may pick up an unwanted hitchhiker after being outside. Be sure to inspect pets for ticks after they’ve been outside as they may deliver a tick to you, and they can also become sick with Lyme disease. 

After being outdoors, remove clothing and wash and dry at a high temperature as ticks may be lurking inside the folds and creases. Washing alone will not kill ticks—even with bleach—it’s the heat of the dryer that does the trick. 

Take a shower or bath within two hours of coming back inside, then perform a whole-body tick check. In the case of Lyme disease, infection from a tick to a human typically takes 30 – 40 hours, so spotting and removing them quickly is an important first defense. (It is uncertain how long it takes for Babesiosis to spread).

If you discover a tick attached to you, carefully remove it. Using tweezers, grasp it close to the skin and pull straight back without twisting or yanking. There are also devices on the market today that are made for effectively and efficiently removing ticks. Avoid pressing or squeezing the tick’s belly as it can push bacteria into your body. Similarly, do not use the heat of a match that you light and blow out, or petroleum jelly. After you’ve removed the tick, disinfect the bite area. Save the tick for possible identification by a doctor or the local health department. 

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Heat Wave Spikes Foundation Repairs

July 22, 2011 2:27 pm

Such high temperatures, for prolonged days, have caused a spike in foundation repair says Julie from Dallas based Premier Foundation Repairs Inc. "The foundation of your house in Dallas are unfortunately sitting on very expansive soils. This type of soil is very sensitive to moisture, causing large amount of swelling and shrinking depending on how much water is present." The photo to the right shows a section of a lawn’s ground, only four days after a major storm. 

Premier Foundation Repair Inc. has a few suggestions for the homeowners that will help prevent the need for foundation repairs: 

1. The grounds’ moisture around the home's perimeter should remain as constant as possible.
2. Periodical use of a sprinkler system and soaker hoses together is the best solution. Homeowners should bury the soaker hoses 12-16” away from the foundation of their residence.
3. Water the yard at night when evaporation is greatly reduced to use less water and save money. 
If an automatic sprinkler system is not available, homeowners should use the manual type and rotate it around the perimeter of the house. What is important is that the moisture levels around the perimeter of the house stay as constant as possible. 

If a residence shows signs of foundation problems, the customer needs to remember that the root cause, most likely a moisture level issue, will need to be addressed in order for the foundation repairs to last permanently. 

For more information, please visit

Word of the Day

July 22, 2011 2:27 pm

Contingency. A provision in a contract that keeps it from becoming binding until a certain event happens. A satisfactory inspection report might be a contingency.

Question of the Day

July 22, 2011 2:27 pm

Q: Are interest rates negotiable?

It depends who you negotiate with. Some lenders are willing to haggle on both the loan rate and the number of points, but this is not typical among more established lenders.

This is why it pays to shop around for the best loan rates. And know the market so that you sound informed when talking to a lender. Read the published rates in local newspapers or check the growing number of Internet sites that publish such information.

Also, always make a point to consider the interest rate along with the points to access which loan is truly the best.

Interest rates are much more open to negotiation on purchases that involve seller financing. While they are usually based on market rates, some flexibility exists when negotiating on the rate.

Saving Strategies That Work

July 21, 2011 4:57 pm

If you find spending money a lot easier than saving it, you may need to back your way into some out-of-the-box savings strategies, say the financial mavens at Money Magazine, who offer seven ways you may not have thought about to help you build up emergency savings.

1. Do it without thinking – Set up an automatic deduction from checking into savings. Pick an amount you won’t miss—as little as two to five percent of your deposits—and you’ll be surprised at how quickly your savings can grow.
2. Keep paying yourself – When you pay off a long-term loan, continue paying that money into savings. The cash is there for you if you really need it, but adds up fast when paid into savings.
3. Avoid temptation – Just as a dieter can avoid the bakery, so should the shopper avoid the mall. If diversion is what you’re after, opt for the park instead of the mall.
4. Squash the impulse – Try the 24-hour rule: if you still need or want an item after a 24 hour wait, go get it. If not—it’s money saved. Can you bank it?
5. Save for little splurges – Save up for that day at the spa instead of booking it and paying with plastic. Knowing the bill won’t show up on your statement next month makes the splurge even sweeter.
6. Enjoy the compounding – Instead of paying interest on the interest as you pay down credit cards, you can actually enjoy compound interest for a change as you watch your money grow.
7. Reward yourself – Set savings goals, and give yourself a little reward each time you reach a goal level. A new outfit, a nice dinner out or a weekend away are sensible rewards to plan for.