I don't expect government handouts but, as was done with the almost invisible tax cut, our government reps speak with forked tongue. Newsweek prints a story as to how you should wisely use this "windfall", as if the amount is enormous. Also, if you are going to write about it print the real story. First you wrote: "Most singles will get $600, couples will get $1,200, and parents will get $300 for each dependent child". Most makes it sound like a great %. Other writers don't even use the word most they use all. Fact is, the child has to be <18 years old and not be claimed as a dependent. That excluded our kids and I'll bet most middle income families fall into this category. I think the Senate Democrats stuck this. They had to get funding for the rebates given to those who would not qualify on any level. After all we need to help those who need it the most.
As far as all the grandiose plans to spend like drunken sailors and stimulate the economy, here is where my $600 went: $450 went to renew my registration on my 2 year old car, since it went up again. We have I believe the 3rd highest rate in the nation. I have $150 left. My property tax valuation came in higher (as usual). We are among the top ten in that category. I will probably split the remainder among that and a half a tank of gas.
As far as the stealth tax cuts, mine have gone up throughout the Bush administration. How? Under the Bush administration I lost most of my deductions, college tuition, dependent eligibility among the most drastic. What Bush cut the Congress and Senate taketh away somewhere else. So in summary, someone should write about the sham economics. I don't depend on the government nor do I expect help. The unfortunate part is our government has to resort to fiddles (tax and rebate placebos), much like our car manufactures, to placate the misinformed. All this while Rome burns. Thank God if Obama gets elected, I can go to my religion for comfort.
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Tax Rebate Redux
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Feed the Retirement Accounts. If you're not maxing out your 401(k) plan, raise your contribution by the amount of your rebate. You'll cut your taxes next year, take advantage of having your interest compound forever and possibly snag some matching funds from your employer. If you're already filling the 401(k) to the brim, put the money in a Roth IRA. Let that one $1,200 stimulus payment ride for 25 years at 9 percent and you'll have $11,000.
Pay the Kids. You'll get an extra $300 for each of your kids, so spend it on them. Use it for a starter deposit in a Coverdell education savings account or a 529 college savings plan. Compare plans at savingforcollege.com. If you have working teens you can use the money to match their summer job earnings and establish Roth IRAs for them. Seed a family investment club and start teaching your kids how to pick stocks. Learn how at the National Association of Investors Corporation. It can cost surprisingly little to buy a few shares of stock, and kids who start young end up rich, says Millen.
Invest It in Yourself. If you've been putting off costly dental work or a medical checkup, do it now, says Mari Adam, a financial adviser in Boca Raton, Fla. "You're investing in your most important asset." Another invest-in-yourself idea: take a class that can further your career or enrich your mind. Or spring for a onetime soup-to-nuts (or insurance-to-investments) financial review. You can find a fee-only financial planner at the National Association of Personal Financial Advisors, or at the Garrett Planning Network, which has advisers who charge by the hour. Let them figure out a way to save you a stimulus check every year.
Take a Vacation. The latest thinking holds that experiences are worth more than things. So skip the large-screen TV (the longer you wait, the less it will cost, anyway) and take the family on a great trip. Blow your rebate building memories, and visit a national park or two on the way. Nothing could be more stimulating and patriotic than that, right?
Give It Away. It's always nice to share a windfall, and a number of nonprofits are asking for a piece of your rebate. That includes everything from the big-name political campaigns to the Episcopal Church to local charities aimed at using the money to save specific foreclosure-threatened homes. But the best way to make sure your check gets used in a way that's meaningful to you is to give it to a charity you already embrace, or check out new groups to make sure they are bona fide. You can find small local charities at Network for Good, and look at charities' financial reports and ratings at give.org and GuideStar. And whatever you do, don't give your rebate away to any caller you don't know who asks for your bank account or Social Security number as a means of transferring the money more quickly; it could be a scam.
© 2008
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