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I always think it is important to teach my children the value of a dollar and we had an interesting lesson this past weekend. It all started when my husband and my young son started looking at Star Wars items on the internet. That led to them going on Ebay and my son deciding that he simply HAD TO HAVE the custom painted Star Wars Lego mini-figure. There was a little over an hour left in the auction and the current bid was at $12.50 with free shipping. The next thing I know, my son was dumping the money out of his piggy bank and was ready to hand it over to somebody… Anybody so that he could get the Lego. Clearly he did not understand Ebay.

I had to explain the entire auctioning process, the payment through Paypal, and the shipping concepts to him. Within this I asked him how much the figure was worth to him and then I made clear that he might not win the auction. I did not agree with how much he wanted to spend but since he was using his allowance, I agreed to help him. I think one of the biggest mistakes people can make on Ebay is that they get caught up in the auctioning process so I wanted to teach him about not spending more than he thought the figure was worth. To do this, I waited until the last 30 seconds to enter in his maximum bid. As it turns out, he didn’t win it but he already had another one in his sights and using a similar process of bidding at the last minute, he won without paying more than he (or we) wanted to spend.

Although I still think my son spent more on the Lego than I personally thought it was worth, he is very happy and is looking forward to it showing up in the mail this week. Meanwhile, it did turn out to be a good opportunity for us to explain the process to him and to show him a good way to weigh the value of the item against the money in his piggy bank.

And for now, both he and his father are BANNED from Ebay!

Mortgage rates, however, are at a 50 year low so many people are successfully reducing their household expenses by refinancing their loans. Just yesterday I read an article that indicated as many as 79% of the new loan applications in June were for refinancing. If you are considering refinancing your property, ask yourself the following questions to see if it might make sense for you too:

1. THE RATE – - Will refinancing provide you a significantly lower rate? Anything at or above 1% difference from your current rate is significant.

2. THE FEES – - How high are the closing costs and fees? Be sure to check for hidden fees or state/ local costs (attorney fees) that may not be indicated on national websites. How many months will you need of the lower rate to off-set the closing costs and fees?

3. THE DURATION – - How long do you realistically think you will continue to own the property and how does this compare to the number of months you need to off-set the cost of refinancing?

4. THE PRODUCT – - As you think about how long you expect to own the property, you may also want to consider your alternatives when you select which loan fits your needs. Adjustable rate loans have even lower rates but they carry a risk if end up staying in the property long enough for the rates to start adjusting.

Last Friday afternoon we loaded up the car and headed towards the Grandparents house in the North Carolina mountains for the Fourth of July weekend. We were just about 40 miles north of Athens when we made a right turn on I-85 North and then we hit it. A parking lot! It seemed like anyone and everyone was heading somewhere for the long weekend. I think we were averaging about 4 mph.

We began searching our GPS and maps for an alternative route and called the Grandparents. They said that the national news was reporting that people were traveling in record numbers. It seems as though many fiscally responsible Americans have been cutting back on their expenses and skipping or scaling back their vacations over the last few months and years but that trend may be easing up now. And companies are making it easier for us to fulfill our yearning vacation dreams by offering unheard of discounts. Just this morning I received notice of an airline sale for travel through November. This is a very rare move for the airlines since the summer is typically a busy season for air travel but to me it just shows how companies are willing to offer great discounts to get our travel business. Hopefully we can all take advantage of it!

The recent oil spill that has tragically occurred in the Gulf Coast has unfortunately been a lesson to many investors that diversification really does matter. Many people that own BP shares and rely on dividends for retirement are in serious trouble. If anything can be taken out of this horrible situation by someone who was not a BP stock owner, the importance of diversification would be the key. Everyone usually thinks that the one company they have invested their money into and rely on in the future will always be stable, until they are not. The bottom line of the story is to diversify within each class that you own. This includes dividend paying stocks as well as municipal bonds. On top of this you should also diversify your retirement income. Diversification might not always protect you from financial crises such as those seen in 2008, but it will definitely help you to avoid the troubles of those who are solely invested in a single stock like BP right now.

Once again we are into the summer season and gas prices are up. Just this week I drove my kids to Hilton Head Island for a quick two days at the beach. The drive is just under 5 hours for us but along the way I was astonished at the different fuel prices I saw. Fortunately my car gets decent fuel economy so I was never really strapped to where I had to fill up. I did observe however that the prices were higher in the resort locations (of course Hilton Head) or places where people would possibly be stuck paying the asking price because there was no other option (right along the freeway or in towns so small that there were few options).

Fortunately for consumers, there are some options that make it easy to find the cheapest gas prices in your area. I tend to use http://autos.msn.com/everyday/GasStationsBeta.aspx or you can go to www.fueleconomy.gov to find several sites. I even found an application for my iPhone and it appears as though there are applications for Android phones as well. Applications like these provide consumers the ability to instantaneously compare prices and select the best station. It doesn’t get much better than that!

Although I have heard terror stories of people getting their identity stolen and having their credit ruined for years, I am still one of those that somehow believes it will never happen to me. This theory is absolutely false so I set out to identify some ways to keep my identity my own. Not only are thieves stealing just credit card numbers, now with stolen Social Security numbers, they are filing false medical claims, applying for mortgages, and opening lines of credit for false businesses.
Your first step of prevention can be done by checking your monthly statements of your financial accounts. Online accounts are a great way to stay on top of this. Next, order and review your credit reports. TransUnion, Equifax, and Experian are all required by law to provide one free credit report per year. AnnualCreditReport.com has links to all three and is the only place to get them for free. If you look at your information and it is old or inaccurate, make sure to change it or have it removed. Make sure to shred old bank statements, applications for new credit cards, and any other documents that have your information on them. Never carry your social security card with you in case your wallet is lost or stolen. It is also important to have secure online passwords and to change them often.
If identity theft does unfortunately happen to you and you notice something on your bank account or existing accounts, first report it to the company. Most of the credit card companies have strong consumer protections in place so by using a credit card rather than a debit card for purchases, you are protecting yourself. After you have reported the problem it is wise to place an initial fraud alert with one of the three major credit reporting agencies. The alert entitles you to a free credit report. If a fraud has indeed occurred, you should file both a complaint form with the trade commission and an identity theft report with your local police department.