A blog about spending wisely in your twenties, with advice on everything from cooking to saving money on gas; how to teach yourself to save money instead of spending it, traveling without breaking the bank, and much more.

Tuesday, January 27, 2009

I'm All for Stimulating Our Economy...

But I'm a little tired of hearing about it. I realize there are people losing their homes in foreclosure. I realize there are people whose retirement accounts are now undervalued. I realize that millions are out of a job right now.

I ALSO know that in America, when you're unemployed - the government gives you a hand. I think that rocks. I'm willing and proud to help pay for unemployment. We live in a country where - when the markets tank and people are losing money and businesses are hurting - the government tries to find a trillion dollars to fix the leak. Everywhere I go I hear about the economy. I even hear about about the economy from people who don't have a savings account, much less a retirement account or a mortgage.

There are a couple million people living in poverty in this country who probably don't feel the pinch at all. They were already pinched.

What in the hell is wrong with us? Why are we still whining? Why are we so worried about whether we can gas up our cars, and why on EARTH do people think not having cable TV is a sacrifice?

My husband and I are well off.  Extremely well off, actually. Insanely, insanely well off. We've got multiple computers in the house (well, duplex), two cars, multiple televisions (we need to dump one, incidentally), annual passes to Disneyland, cell phones, an iPod each, and secondary educations - albeit incomplete ones.

We eat dinner every single night, we have lunch every day, and breakfast when we wake up on time. Our cat eats twice a day. We have running water, electricity, gas, and high speed internet. (No cable TV though, that's why we have the high speed internet - oh the sacrifices we've made.)

I have 30+ pairs of shoes, and that's after selling off nearly all of my designer shoes a couple years back, so I could pay rent. See, I thought I was making a huge sacrifice, selling my way, way overpriced shoes to make rent.

My overpriced shoes could have fed a family for a year in Sierra Leone. I don't have numbers on that, but I'm not a bloody statistician. Google it, I'm sure you'll find that half a pair of my designer shoes could have fed somebody, somewhere.

Back when I had cable, sometimes I watched 'My Super Sweet 16.' For those of you who don't know - ugh. Just click the link. It's a train wreck. These girls scream about not getting a $500,000 car. I couldn't look away. I got the hugest kick out of swigging by beer, confident, nay smug, in my superiority to a bratty little child whining about her multi million dollar birthday party.

Here's the thing about that; I'm not much better than those petulant brats when you put it in a global perspective. I don't need to quote statistics. Almost anyone who's lived in the world for four or more years knows darn well that that are people in this world who live for a month on what we spend on a latte and a bagel in the morning. My household pulls in more than 50K a year before taxes and by God, we are filthy rich. Not only are we filthy rich compared to most of the world, we're filthy rich compared to millions here in the U.S.

I'm not saying that those of us who are lucky to live in the ultimate First World nation should scrap our big screens or our cars our even our luxury goods. 

I'm just saying we should quit whining.

Monday, January 26, 2009

Oh No, They Be Holdin' My Refund Hostage

You've probably already heard the fuss about getting IOUs instead of refund checks here in California. That said, according to this, if you file early enough, you should get your refund as usual. Last year the FTB (Franchise Tax Board) processed my refund in a matter of days. As usual, I'm neither expert nor professional, but this is probably the last day to file with even a slight hope of getting your return processed before the February 1st deadline and the 30 day hold.

As I've emphasized before, most of my readers will qualify for free file - for your federal taxes as well as your state taxes. If you're in California, I suggest you grab your W-2 and try to make the deadline.

Economic Stimulus Now, Redux

A fact you may not be aware of is that if you get legally married late in the year...say, the day after Christmas - you're required to file your taxes as though you were married for the entire year. Even if you get married at 11:59 pm on Dec 31st, the IRS considers you to have been married for the entire year.

2008 is a particularly useful year for this. Remember the Economic Stimulus rebate? Single folks got somewhere between $300-600? Married folks got $1200? The amount of your economic stimulus rebate was based on your 2007 taxes, because you hadn't filed your 2008 taxes yet because the year wasn't over. You 2008 self was getting money based on what your 2007 tax return indicated about your 2008 return which would be filed by your 2009 self. Sort of. Anyway, that's part's boring. (Though there may be DeLorean joke in there somewhere.)

Point is, if you received a $373 rebate check as a single person in 2008, and then got married later in the year to a spouse who got a $600 check, the government owes you $227 - because the IRS considers you to have been married during the handout. $1200-($373+$600) = $227, for those of you who hate 'rithmetic.

If someone claimed you as a dependent on their 2007 taxes, exempting you from the rebates at the time, but no one can claim you in 2008 - the government owes you a stimulus check.

If you had a baby in 2008, you also qualify for more money.

Basically if your life changed at all in 2008, you might qualify for more money.

Where do you claim the credit, you may ask? Good thing I read the IRS website, so you don't have to:

Form 1040 - Line 70
Form 1040A - Line 42
Form 1040EZ (the one most of you will likely use) - Line 9

All of the tax forms will come with an instruction worksheet on how to calculate your stimulus credit. So if you're doing your taxes on paper using pen and ink by the light of a gas lamp, knock yourself out calculating that. Or enter "RRC" on the appropriate line and the IRS will calculate the stimulus credit for you.

If you're filing online, most online tax preparation programs will calculate this for you.

Most folks reading this blog, except maybe my mom (hi mom), qualify to free file. So please, PLEASE, don't hand a tax prep firm your hard earned money to file your probably very uncomplicated taxes for you. Don't give them money to give you a refund anticipation loan at a ridiculously high interest rate when the government will direct deposit your refund in a week or two if you file early. Seriously, you may as well - well, you know.