The recent wildfires in California forced thousands of families from their homes with little to no warning. If you ever find yourself in a similar situation where you need to evacuate your home with only a moment’s notice, having an escape plan mapped out ahead of time could potentially save your life, as well as some of your belongings.
Learn from the experts
Conduct a review of your situation now. Here are links to three great resources:
This includes smoke and carbon monoxide alarms and proper fire extinguishers all in the proper places and all in working order. Remember to test them according to the recommendations by the manufacturer and fire prevention experts. This may be monthly or even weekly. Take special note as to the date of installation, as older detectors are preset by the manufacturer to expire. When this happens you will hear an annoying beep. Your only recourse it to change out the expired equipment.
Be prepared with fire knowledge
The top causes of home fires are cooking, heating, electrical, smoking, and candles. Knowing this, you can reduce the risk of fire by creating an awareness trigger when engaging in these areas. For example:
Know how to handle different types of cooking fires both inside and outside.
Know where shut off valves are for gas.
Unplug when not using electrical devices.
Never smoke inside.
Only buy candles enclosed in glass.
Have an escape plan and practice it!
When a fire from within your house occurs, you have two minutes to get out. Create a plan, provide two methods of escape, and practice the plan every six months. Know where you are going to meet so everyone is accounted for after you exit. This is especially important for kids as they may need to escape without your help. Also think about overnight guests and grandkids at sleepovers. This is where reviewing plans from experts can help.
Get out. Stay out. Call for help.
Make this your mantra when in the midst of a fire emergency.
Review this I wish list.
Hindsight is 20/20, especially when it comes to fires. Here are some tips from those who have gone through it. I wish…
I had a go bag. This is a small bag of essentials stored in your bedroom to grab if you need to leave in a hurry. It contains a change of clothes, coats, or other emergency items for the kids.
I had a good inventory. After the fire, you are going to spend a significant amount of time with insurance adjusters. Periodically review your policy and develop an inventory of your household items. Take videos, document models and ages of major appliances, autos, other equipment, and valuables.
I had a ‘where to go’ plan. If you cannot return to your home, where will you stay? How will you pay for it? Figure this out ahead of time.
I had a remote backup of my computer and phone. Remote backups can be invaluable in getting you back up and running.
I had an emergency fund. It will take a while to get your life back in order. What if you need to take time off from work? Having 6 months of emergency funds can make all the difference as you recover from a fire.
The purpose of this article is not to act as an expert in fire safety, but rather to help generate awareness in this often overlooked subject. If, however, you need expert advice with your financial and tax affairs as you navigate this or other disasters, please call for help.
One of the most common reasons businesses fail is due to lack of proper cash flow. The same is often true in many households. Here’s how this concept of cash flow applies to you along with some ideas to improve it.
Cash flow defined
Cash flow equals cash coming in (wages, interest, Social Security benefits, etc.) and cash going out in the bills you pay and money you spend. If more is coming in than going out, you have positive cash flow. If the opposite is true, you have negative cash flow. Unfortunately, calculating and forecasting cash flow can get complicated. Some bills are due weekly, others monthly. A few larger bills may need to be paid quarterly or annually.
Create your cash flow snapshot
Before improving your cash flow, you need to be able to visualize it. While there are software tools to generate a statement of cash flow, you can also take a snapshot of your cash flow by creating a simple monthly spreadsheet:
Type each month across the top of the spreadsheet with an annual total.
Note all your revenue (cash inflows), then create a list of expenses (cash outflows) in the left-hand column.
Enter your income and bills by month. Create a monthly subtotal of all your inflows. Do the same for your cash outflows. Then subtract the expenses from income. Positive numbers? You have positive cash flow. Negative numbers? You have negative cash flow.
Create a cumulative total for the year under each month to see which months will need additional funds and which months will have excess funds.
Ideas to improve your cash flow
Identify your challenges. See if you have months where more cash is going out than is coming in to your bank account. This often happens when large bills are due. If possible, try to balance these known high-expense months throughout the course of the year. Common causes are:
Holidays
Property tax payments
Car and homeowners insurance
Income tax payments
Vacations
Build a reserve. If you know there are challenging months, project how much additional cash you will need and begin to save for this during positive cash months.
Cut back on annuities. See what monthly expense drivers are in your life. Can any of them be reduced? Can you live with fewer cell phone add-ons? How about cutting costs in your cable or streaming bill? Is it time for an insurance review?
Shop your current services. Some of your larger bills may create an opportunity for savings. This is especially true with home, rental and car insurance.
Create savings habits to add to cash flow. Consider paying a bill to yourself in your cash outflows. This saved money is a simple technique to create positive cash flow each month to build an emergency reserve.
As a business owner, you’re required to pay three different types of payroll taxes.
FICA (Federal Insurance Contributions Act) is the tax used to fund Social Security and Medicare programs.
FUTA (Federal Unemployment Tax Act). Employers pay this federal tax to provide unemployment benefits to laid-off workers.
SUTA (State Unemployment Tax Act). State governments also collect taxes known as SUTA that finance each state’s unemployment insurance fund.
While FICA may be easy to understand, unemployment tax calculations are easily misunderstood.
How FUTA and SUTA taxes are calculated
The FUTA calculation. The federal unemployment tax rate is 6% on the first $7,000 of each employee’s income, regardless of where the company does business. In addition,
employers who pay their state’s SUTA taxes on time can receive a maximum credit of 5.4%, reducing the FUTA rate to 0.6%. Certain employee benefits—employer contributions to health plans, pensions, and group life insurance premiums, for example—are also excluded from the calculation.
SUTA taxes are more complicated. Tax rates and taxable thresholds (known as wage bases) vary from state to state, industry to industry, and business to business. In Oregon, for example, the first $54,300 of an employee’s salary is taxed under SUTA. In Arkansas, that threshold is $7,000. In Oregon, a new employer is taxed at a rate of 2.4%, but more established businesses in that state have rates ranging from 0.9% to 5.4%. In Arkansas, the tax rate can range from 0.1% to 5.0%. Other factors affecting your SUTA tax liability include the business’s history of on-time payments to the state insurance fund and the number of former employees receiving unemployment benefits.
How to reduce your SUTA and FUTA tax bills
Hire cautiously. If you employ someone who doesn’t work out, you could end up with additional unemployment claims and a higher SUTA tax rate.
Train vigorously. To increase productivity and reduce turnover, target your investment in continuing education. Keep employees happy and loyal. Again, high turnover leads to unemployment claims, which leads to bigger SUTA tax bills.
Terminate judiciously. If you must reduce personnel, consider offering severance or outplacement benefits to terminated employees. The sooner they return to the job market, the fewer the unemployment claims that will be factored into your company’s SUTA tax calculation.
Dispute carefully. Take the time to verify the accuracy of unemployment claims, as bogus representations by former workers can drive up your SUTA taxes. If an employee was fired for gross misconduct and thus disqualifying himself or herself from collecting unemployment, have strong documentation to support the termination.
Pay regularly. Under federal guidelines, employers who make their SUTA contributions on time can reduce the amount of FUTA taxes by up to 90%.
Remember, you do not need to navigate the complications inherent in filing your business taxes. They can be complicated and easily overlooked when you add things like sales taxes and income taxes. If you have questions or need help please call.
Scammers are becoming increasingly sophisticated, with more emails, phone calls and text messages crafted to look and sound like the real thing. This is often because thieves are adding artificial intelligence to its arsenal of tools to transform their tricks into messaging that genuinely looks like its coming from a person you know and trust.
Here are the top ways that scammers are using AI and what you can do to protect yourself.
How Scammers are Using AI
AI-Powered Phishing Attacks. Phishing attacks have been around for decades, but AI makes them far more convincing. AI can analyze large amounts of data to craft messages that look and sound authentic, increasing the chances of tricking victims into clicking malicious links or providing personal information.
Deepfake Scams. Deepfake technology allows scammers to create realistic videos and audio clips that impersonate real people. Some examples include fake videos of CEOs instructing employees to transfer money or of celebrities endorsing fraudulent products.
Generate Realistic Conversations. Scammers are using AI chatbots that can hold realistic conversations with potential victims. These bots can appear very convincing while pretending to be customer service agents, a friend or family member, or even government officials. The goal is to trick you into sharing sensitive information or sending money.
Fake Profiles. AI can scan all of a person’s online footprint to create a realistic profile and social media accounts. Scammers then use these fake personas to try and steal information and money from you.
Protect Yourself from AI-Driven Scams
Be skeptical of unsolicited messages. If you receive an email, text, or call from a company or person you don’t recognize, verify its authenticity before responding. Do this by contacting the company or person directly using official channels.
Use multi-factor authentication (MFA). Constantly using MFA on every website you visit may cause some frustration, but it’s nothing compared to the frustration you may experience if your identity or money are stolen. Even if scammers steal your password, they’ll need an additional verification step to access your accounts.
Verify identities. If someone claims to be a friend, boss, or family member requesting money, first verify their identity through another channel, such as a phone call or video chat.
Look for red flags. AI-generated scams often contain small inconsistencies—such as unnatural speech patterns in voice messages, slight facial distortions in deepfake videos, or unusual grammar in AI-generated texts. Trust your instincts and independently verify whenever you can.
Immediate Required Action: Review your savings account interest rate and take necessary action to avoid potential deceptive, unreasonable, and obscure rules that are keeping your money from making a reasonable interest rate!
Background
When interest rates rose due to inflation, banks and credit unions quickly raised their interest rates on credit cards, mortgages and loans, but were reluctant to reward loyal customers with higher interest on their deposit balances. They simply decided to put the extra profit in their pockets or were afraid they could not afford to pay market interest on their deposits.
These deceptive and unreasonable practices are words used by the Consumer Financial Protection Bureau (CFPB) in describing one bank’s practice to avoid paying market rates to many of their loyal depositors. So which tricks are being used?
Some common practices
The mirror trick. Create a new savings account with a similar name to one that earns less than ½ of one percent of interest. But the new account gets a much higher interest rate (allegedly 14 times higher!). Then, don’t be great at telling the current account holders, so they do not realize they are being grossly underpaid for their deposits. Example: Capital One (See CFPB lawsuit) Why do this? It dramatically lowers the bank’s interest expense since they do not roll the old, low interest accounts into the new, higher interest account. But they still offer a competitive savings product to attract new money.
The CD trap. Grossly underpay those with savings deposits, especially small, local businesses. Instead, offer CDs with better interest rates. Then introduce EXTREMELY high early withdrawal penalties (compared to traditional early withdrawal penalties historically used on CDs.) Classic examples: Chase Bank and US Bank, but there are many more!
Why do this? It makes it a lot easier for the bank treasury group to forecast the bank’s net interest income spread, as their deposit interest expense is more predictable.
The trained seal mirror trick. A major national credit union took the mirror trick above, then created additional rules to ensure ONLY new money gets the better interest rate. So they only make the new, similarly named, high interest bearing account available to NEW deposits into the credit union. So, no transferring funds from another internal account to get the higher interest.PLUS, you are required to set up automatic deposits in the account each month to obtain the best interest. To get the high rate, you need to transfer your money out of the bank, then keep it somewhere else for a time, then transfer it back. In other words, you need to be trained in the tricks to get the reasonable interest rate. Just like a seal. Why do this? Banks don’t want to pay these higher interest rates on existing deposits.
What to do now
Understand the impact. If you aren’t watchful, your savings account is earning much less than 1 percent interest when you could be earning over 4 percent in a similar account EVERY DAY.
Fight inertia. What all these tricks have in common is the benefit of inertia. These practices are commonly used by cell phone companies. They give the best deal to the new guy while gently deceiving their long-term subscribers. When is the last time you looked? Well, look now!
Find the right account. Often the answer is within your bank by getting into the right account. But you may find it is at another institution. Be willing to set up the right account at the right place. Current high yield savings rates with FDIC coverage range from 3.5% to 4.8%.
Develop fluid management. With secure online transfers, it is now easier than ever to keep your money working hard for you (using high interest rates). This also includes moving excess funds in your checking account. So securely link these accounts, actively monitor them, and transfer your funds to their best use at the highest interest rate. You’ll be amazed at how much interest income you can earn!
