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PaPa’s Got A Brand New Bag: Part 2

January 11, 2007

*This week, I’m bringing you five more of the Top 2007 Financial Resolutions.  As mentioned in last week’s column, in honor of the amazing life of the Godfather of Soul, this month I will be using James Brown songs (or the many songs that sampled him) to show these finance lessons.  Click here for last week’s top 5 list – “Papa’s Got A Brand New Bag – Part 1,” http://www.eurweb.com/story/eur30653.cfm

6. Get Insurance.  “Word from the Wise” (Poor Righteous Teachers, 1990, sampling James Brown’s “Black Caesar, 1973).

      Insurance comes in many varieties and flavors, but whatever it is, not having it can cause you and your family a lot of heartache.  This not only includes life and disability insurance, but it also includes renter’s insurance. When it comes to life insurance, look for coverage at about 10 times the amount of your salary.  For disability insurance, about 60% of your salary is the norm. 

      Finally, look into renter’s insurance.  Most American’s are renters  – apartments, townhomes, trailers, condos, and/or single-family homes.  Some are saving to buy that first home, while others are content with their current place.  Whatever the case, almost all have worldly possessions in that home that they just can’t live without.  Yet, nearly 66% of those people don’t have renter’s insurance.  Such insurance will protect their belongings in the case of theft, fire or a natural catastrophe (think Hurricane Katrina).  Although some things just can’t be replaced, having money to go out and at least try to rebuild your life goes a long way;especially since many renter’s insurance policies cost less than $250 a year.  You can get quotes on these from many of the large providers: Nationwide, State Farm, USAA, and Countrywide, just to name a few.  Also, check out this website, for a quote on renter’s insurance http://www.insweb.com/.  Stay tuned to my January 18th column for more on insurance. 

7.  Get more income in 2007.  “I’m A Greedy Man” (James Brown, 1971)

      Take control of your own destiny.  Although you may not be able to afford to quit your day job, you can start building your true passion with a side gig.  Small businesses range in all shapes and sizes.  From selling Avon™ and Mary Kay™, to opening up a small catering company, consulting business or selling on eBay™.   This new business may not only allow you to follow your dreams and make more money, but you may also get a tax break.  For more on this, see my June 1, 2006 column, “Everybody Needs To Mind Their Business”http://www.eurweb.com/story/eur26665.cfm.

8.  Stop smoking.  “Give It Up or Turn It A Loose” (James Brown, 1970)

      This is another really popular New Year’s resolution that may not seem related to finances but it really is.  Did you know the average smoker spends $1,600 to $2,000 per year.  The money you could save from kicking the habit could help you buy set up that retirement account or even buy a new home.  It can even help you qualify for cheaper life insurance rates.

      I know quitting is easier said than done, but there are many things on the market to help you; from cheaper methods (like patches) to more expensive methods (like hypnosis at the trendy Los Angels Dtox Day Spa).  For more check out – http://dtoxdayspa.com/ and http://www.cdc.gov/tobacco/how2quit.htm

9. Get right with the IRS.  “Papa Don’t Take No Mess” (James Brown, 1974)

      Do you have past tax debts?  Make this the year to clean up these debts.  In many cases you can negotiate a payment plan with the IRS, or even get the debt down by making an offer and compromise.  For more on this see my May 18, 2006 column, “Tax Man Cometh” http://www.eurweb.com/story/eur26452.cfm

10.   Get organized! “Mind, Body, and Soul”(Afrika Bambaataa ft Family, 1988, sampling James Brown’s “Hot Pants,” 1971)

      Start this year out by losing your pack-rat ways.  Start with those accordion folders, and go all the way to your computer programs (Excel files, Quickbooks, Quicken, etc.) – find a system and stick with it.  For many people, this will take less than a few hours each month.  By doing this early, without the deadline hovering over you, you just may uncover deductions you didn’t realize you had.  For more on getting organized see my December 21, 2006 column, “Year-end Tax Countdown/Week 4,” http://www.eurweb.com/story/eur30565.cfm

Originally published for Lee Bailey’s EUR Web

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