The Salina Journal from Salina, Kansas on May 6, 2001 · Page 35
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The Salina Journal from Salina, Kansas · Page 35

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Salina, Kansas
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Sunday, May 6, 2001
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Page 35
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THE SALINA JOURNAL MONEY SUNDAY, MAY 6. 2001 E3 Quinn / Reduce your debt T RETIREMENT PLANS FROM PAGE El If your record is "good" or toward the upper end of the "closer-look" range, look for ways to improve it. The best and fastest ways are to pay any delinquent bills and lower your total credit-card debt. Debt reduction should start with the cards where you're closest to your credit limit. And make sure to make all future payments on time. , Some of the other quick fixes people try usually don't work, says Tom Quinn, Fair, Isaac's director of consumer initiatives. For example: • Closing unused credit cards probably won't raise your score. The models looks at how you use the credit you've got, rather than the amount you have available. Individual lenders, however. might feel more comfortable if you reduced the amount of open credit you have available. • Paying off one delinquent bill won't raise your score much if your record is littered with other credit blemishes. Credit scores consider patterns of behavior You have to show yourself creditworthy over a period of time. • Making all your minimum payments won't make you look good if your cards are maxed" out or anywhere close to it. Credit scores look at how much of your available credit you've used. When you're close to the line, you look out of control. • Opening new, debt-free cards won't make you look better, if your other cards are maxed out. True, your average debt looks lower compared with your total, available credit. But new credit lines don't weigh as heavily in the formula as old ones do. • You lose points if you never use your credit cards. Lenders want to see that you can charge purchases and repay on time. • You don't improve your score by carrying balances forward from month to month, as opposed to paying each bill in full, Quinn says. But lenders may mail more offers to people who carry balances, because they pay interest on their accounts. • If you're comparison-shopping for a mortgage or auto loan, make all your inquiries within a 14-day period. Those will be grouped together and counted as a single inquiry Spread-out inquiries register, separately and make it look as if you're hungry for credit. That knocks down your score. Benefit cutbacks are on horizon Checks / Credit cards get rival FROM PAGE E1 Consumers, meanwhile, are likely to find checks are accepted more at stores where credit and debit cards have made heavy inroads. Their checks essentially will become single- use debit cards. "The consumer gets more payment choices," said Carol Malicki, chairman of SafeCheck and an officer at First Union Corp. in Charlotte, N.C. "They can decide which payment method they want to use in which environment." The tradeoff for check writers is the loss of "float," the time between the deposit of a paper check in a bank and the time when the money is debited from the checking account. Americans who live paycheck to paycheck take advantage of "float" when they write a check off an empty account for groceries Thursday, then deposit their salary checks Friday to cover that transaction and future spending. O'Toole said retailers are aware of customers' dependence on "float" and can use the new system to verify an account exists but still send checks electronically for settlement the next day Both O'Toole and Malicki said there will be signs advising consumers their checks are headed for immediate debiting, and store clerks also are to be trained to inform customers of the new system. BB&T Corp. of Winston- Salem, N.C, already has Check- Debit up and running, and other banks are expected to follow after June 1, O'Toole said. First Union has been testing the check verification system, with CheckDebit to be available later this year Other banks behind the project are Bank of America in Charlotte, Citibank and J.P. Morgan Chase in New York, Wells Fargo and Union Bank of California in San Francisco, Union Planters in Memphis and U.S. Bancorp in Minneapolis. Some 50,000 merchants already deal with "electronic checks," said Elliott McEntee, president and chief executive of the NACHA Electronic Payments Association in Herndon, Va. NACHA is an automated clearinghouse that links financial institutions. With this system, checks are run through digital readers, often part of the cash register The customer signs a slip similar to a credit-card receipt and gets the check back. The retailer, in turn, doesn't have to process a paper check. Instead, it clears the transaction electronically through NACHA, the same way it does its credit and debit card transactions. Clearing generally occurs within 48 hotu-s. "All this is bringing checks into the modern age," McEntee said. Workers encouraged to watch for changes in retirement plans By The Associated Press DENVER — Future retirees may find their retirement plan benefits cut back by their employer, and they may not realize it until it is too late, a retirement expert warns. "Sadly these benefit cutbacks come at a critical time in our history when every American needs to be increasing the resources set aside for retirement," says Jim Stone of the College for Financial Planning. "In the not too distant future, when the great retirement tidal wave of baby boomers is at its crest, the dog food aisles will be jam-packed with those who didn't." Stone points to the trend of larger corporations converting their traditional retirement plans to cash-balance plans. The result: Workers, particularly older workers, often lose some of the retirement benefits they would have received had they been able to retire under the previous plan. But Stone says the latest example of a retirement plan being converted through sleight of hand is the proposed changes to the Railroad Retirement Act, which applies to all railroad employees. Stone says he was contacted by a railroad worker who was so confused by the language of the bill currently in the House that the worker thought their current retirement plan was being converted to a cash-balance plan. After sorting through the "Beltway-English" of the bill, with the help of a "Beltway translator," Stone determined the plan was not be­ ing converted to a cash-balance plan. Stone says the efforts to alter retirement benefits through the Railroad Retirement Act, and a corporate trend toward conversions to cash-balance plans, should alert all workers to watch for possible changes in their retirement plan. Stone suggests several steps workers might take. First, ask for and carefully review all documents explaining any proposed changes. You may need to review the documents with the help of a financial planner or other benefits expert. Stone says employees might form groups to oppose the changes, a tactic that has worked in the past. Workers also should follow through if they suspect their benefits have been improperly reduced. Brenda Ratzlaff Vice President Mortgage Lending Quite simply, Security. Security Savings Banli: 317 S. Santa Fe 1830 S. Ohio, Salina 785-825-8241 Equal Housing Lender, MEMBER FDIC. r mm can mean to you! OsaRoth IRA right for you? Call your personal financia advisor from Wadde &Reec and well explain; kContfktion kits kWilMmalpmim iConmiqjouf kiiomlMinto mm waMellm MmbetSiPC WADDEli feREED Financial Services' SM Investing. With a p an. Townsite Plaza Building 131 N. Santa Fe, Suite lA, Salina 785-827-3606 Lois Peterson, CMFC Salina Steve Stein Jim Holder Randy Krug, CMFC Bob Schmidt Salina Salina Salina Salina Toni Renfro Jeanette Sexton Salina Abilene April Barker Abilene Leanna Crist Eric Andersen Minneapolis Concordia Ken Ebert Chris Giroux, CMFC Loren Funk Division Manager Salina Hillsboro MikeLamone Salina Ryan Kolzow Salina DaleSwenson Concordia Tony Jennings Salina Lance Billings Salina Lori Zadina Mankato Brent Scott Belleville Jill Grauerholz JefiF Nicholson Beloit Salina Derik Disney Nancy Nicholson Annette Coonrod Salina Salina Belleville Offices in: •AbileneV 785-263-7496 •Belleville/785-527-7133 • Concordia/785-243-9977 ' •Russell/785483-6768 •Smith Center/785-282.3307 Salina 131N. Santa Fe, Suite IA Lnetta Hanell, CMFC 785-827-3606 Salina Hays 205 E. 13th 1-800-450-9654 Larry Werhan Salina JuUeWeems Chad Koelm, CMFC Sue Black Salina Salina Salina Townsite Plaza Building 131 N. Santa Fe, Suite lA, Salina 785-827-3606 WADDELL Financial Services' Investing: With a planT Bee expert Dr. Norman Gary will blanket his body with 20.000 bees. But you will never catch him insuring his car with cut-rate car insurance. Bee safe with your car insurance. Get dependable service and competitive rates from me, your State Farm Agent. Fred Counts 1101 S.Ohio 785-827-8600 Marsha Hoffhines 122 N. Santa Fe, Suite A 785-827-1707 Robert Pruett 158N. 8th 785-825-2281 Bary Martin 1023 Greeley, Salina 785-825-0555 ; 110 N. Concord,; Minneapolis 785-392-2965 Joe Seed 1612 E. Iron 785-825-4998 like Q good neighbor, State Fann is there. suit fin<\ Mutuat *LlKiia (i.ft Imuiiow LMII(MI >, 'iwl u; t»Jl

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