Wednesday, February 28, 2007

Journalistic probings of the debt and heath care messes

Pulitzer Prize jurors will meet next week to mull over the best of this year's journalistic offerings, and one series getting notice is the Boston Globe's in-depth Debtor's Hell investigation. I've been reading through the pieces during my downtime; there's a lot of material, and it's excellent. The Globe documents both the skyrocketing growth of the problem -- between 2000 and 2005, the number of debt-collection lawsuits filed in Mass. averaged out to one for every five households -- and the catastrophic flaws of an overwhelmed regulatory system that lacks the resources and manpower to keep abuses in check.

I love rigorous work like this that shows off journalism at its best. When regulators, politicians, and the courts fail to protect citizens from predatory practices and ensure just outcomes, we need media attention to focus a spotlight on the problem. Accountability begins with awareness.

In the spirit of spotlighting, I also wanted to point attention to a fantastic piece from last spring in the New York Review of Books: "The Health Care Crisis and What to Do About It". Ostensibly a critical look at several recent books on the U.S. health-care system, the article is really a rigorous examination of what's going wrong, why, and what issues reform measures will need to address.

And if anyone needs another example of why the heath care status quo is not acceptable, just take a look at today's Washington Post: "For Want of a Dentist". The unwritten rest of that headline is "... a ten-year-old boy died from a toothache."

Tuesday, February 27, 2007

The nitty numerical details of being a full-time writer

At the risk of looking like a big shill for John Scalzi's Whatever blog, I'm going to cite it in two consecutive entries. Lots of people fantasize about becoming a full-time writer. Some who try it then write whiney articles about how badly it pays. The harsh reality is that midlist authors don't generate enough ancillary economic activity to make being a midlist author a particularly lucrative career path.

But what are the actual numbers involved? Scalzi, a veteran freelance writer and semi-fledgling science-fiction writer, breaks them out in two blog entries: one tallying what he made from his fiction writing in 2006 and an earlier one approximating all of his writing/editing income in 2005. If you're an aspiring writer, or simply someone curious about the economics of the field, check them out.

On my end, the figures had a few surprises. Scalzi has been pretty successful marketing his work and building a following (a 500-copy run of a small press book published this week sold out before it shipped), and he gets pretty strong critical reviews; I would have expected his take from the fiction to be a bit higher, though I follow his explanations of why it wasn't. If you're making your money off royalties, rather than big advances, it's going to take a long time to actually land in your bank account.

On the flip side, I'm surprised he's doing so well off the freelance journalism and corporate work. Finding steady, lucrative clients who cough up paychecks when they're due is the real skill of freelance writing -- the actual journalism is the easy part. Obviously, Scalzi has got the business end of things well in hand.

The one caveat I'd throw in is that Scalzi has an unusual asset working in his favor: He is insanely prolific. In an average year, he writes multiple novels. If you're going to rely on fiction for a substantial portion of your income, being quick helps; your editor doesn't care how many years you slaved over a book. Your advance depends solely on the book's marketability, not the time that went into its creation.

Similarly, if you're relying on journalism and freelance work, churning articles quickly is going to have a direct, positive effect on your bottom line. Scalzi estimates that he writes 20,000 to 30,000 words in a typical week. I don't think I know of any other writers keeping that pace. In my staff job, I'd estimate that I publish 5,000 to 7,000 words in an average week; my most prolific peers probably do 10,000 to 15,000.

I understand why people are loathe to reveal specific details of their own financial situations, but I'm all in favor of this kind of information being more widely spread. The first step in making any choice is having the information you need for an informed decision.

Monday, February 19, 2007

Birds & Bills redesign!

If you usually read Birds & Bills on a feed, surf on over to the site today -- it features a massive overhaul. The best new element is a gorgeous new logo, designed by artist Renee Thompson. Lacking any design skills myself, I'd been hunting around for an artist to commission a design from. When I found her work on deviantART, I promptly fell in love. And, she specializes in birds! Such a perfect fit! I was really delighted she took the commission, and I'm blissed to be ditching my old off-the-shelf template for a lovely custom design. If you like Renee's work, you can find more in her Etsy store.

The new design also features long-overdue tags functionality. I've added a list of the tags I use to the blog sidebar. That should make it easier if you're hunting for posts on a specific topic, like retirement planning or credit cards.

What other features should I incorporate? Speak up, if there's some site-navigation element you find lacking. For instance, should I compile a "table of contents" with links to significant posts (like the one on 401k strategy, or the article about How FICO scores are calculated)? Does anyone need/want a search box?

While I'm in a bit of a relaunch phase, this seems a good time to mention Birds & Bills' editorial policies. Flipping through (a great blog aggregator) a few weeks ago, I was surprised to find a handful of posts tagged [PayPerPost]. I've heard about this insidious little outlet before, but I hadn't previously run across it in the wild.

I don't consider blog ethics completely interchangable with my day-job, beat journalism ethical practices. (To earn my paychecks, I write about software over at CRN.) I'm a lot more opinionated here about issues and financial services vendors and than I would be about companies/topics on my beat. However, I do consider blog ethics akin to the responsibilities of a columnist: someone whose job is to provide opinionated, personal, but independent views. "Transparency above all" is my policy. If I try out a service I've been given free access to, or review a book from a publisher that has sent a free copy, I'll mention the freebie. If I don't add that kind of disclaimer, you can assume I'm paying the going rate for any goods or services I comment on.

When it comes to advertising, my views nicely coincide with what John Scalzi wrote in the Whatever a few weeks ago: I get approached every so often about running ads here, and I don't take up the offers because, "One, I don't wanna. Two, I don't wanna. Three, I don't wanna." I'm not opposed to ad-subsidized media. Advertising underwrites my paychecks and keeps the magazine I write for in business. But I don't have a pressing need to run it here, and I don't like the cluttered look it gives so many blogs. I've run the math; putting AdSense or whatever on Birds & Bills wouldn't generate enough income for me to consider it worth the visual clutter. So, now and for the forseeable future, no ads.

Finally, while I'm rambling on blogging topics, thanks for reading along over here. Birds & Bills recently had its one-year anniversary. I don't have a good stats tracker (the kludgy one I used broke in today's redesign), so I have no idea how many people are out there, but I'm happy a few people are following along as I thrash out financial matters.

Saturday, February 17, 2007

A sample 'cease communications' letter to debt collectors

My posts about debt expiration and statutes of limitation weren't wholly theoretical. I've been dodging calls for the last few months from a collector trying to shake out money for a debt from 2000 that I don't consider valid. (It's a long story, as these things generally are.) Instead of running through hoops trying to track down all the paperwork to prove that the debt is well and truly not legitimate, I opted to wait out the clock till 2007, at which point it became an indisputably expired debt.

This collector is fairly low pressure; their main tactic seems to be leaving automated messages on my answering machine every few weeks. Still, the calls stress David out and I'd also like them to stop, so I figured it's time to formally issue a "cease communications" request, as allowed by the Fair Debt Collection Practices Act. Under that law, you can at any time tell a collector to stop contacting you, and they have to oblige. Once you've made the request, the only communications they're legally allowed to send is a notice of specific actions, like filing a lawsuit.

In case anyone else can use it, I'm posting the letter I'm sending. I'm citing the New York state law that sets the statute of limitations on debts; if you'd like to find a local law to cite, the Fair Debt Collection website has good pointers to state laws.


[Your Address]

Dear [Collector]:

I am writing regarding your attempts to collect a debt of $XXX for XXXX (account #XXX). I do not acknowledge the validity of this debt, which, in any case, is beyond the six-year statute of limitations for collection in New York, as laid out in the New York State Consolidated Law & Rules (chapter 8, article 2).

In accordance with the Fair Debt Collection Practices Act, Sec. 805(c), I am requesting that you cease any further communication with me on this matter and discontinue phone calls. If I receive any further communication -- other than a written notice that further collection efforts are being terminated -- I will submit a complaint about your organization to the Federal Trade Commission and the New York Better Business Bureau.


[Your Name]

Thursday, February 15, 2007

The trail even Sacagawea couldn't blaze

Think the third time will be the charm for the dollar coin in the U.S.? Refusing to concede defeat after the chilly reception to the Susan B. Anthony and the only slightly more enthusiastic uptake of the Sacagawea dollar, the mint is debuting yet another dollar coin today: the Presidential coin. Among the lures the Mint is dangling are "larger, more dramatic artwork" and edge inscriptions of "E Pluribus Unum" and "In God We Trust."

The New York Times has a detailed look at the dollar coin's advantages and travails. Personally, I like 'em. New Yorkers probably deal with more Sacagaweas than most Americas, since the subway machines give them as change. When I've gone and visited Australia (where David hails from), I've always adapted pretty quickly to the coins-only system for $1s and $2s. Although, their $1 coins have kangaroos. I bet $1 coins would be way more popular here if we put kangaroos on them.

Wednesday, February 07, 2007

TurboTax Rip-Off On Amex Discount

The reason I decided to try TurboTax this year was the 25% discount on the federal return cost. In actual practise, this translated to about $5 off, but by the time that sunk in I was committed.

Having just filed, I feel even more ripped off by my inability to actual get my damn $5. The offer didn't come with a promotion code; to use it, you're supposed to access TurboTax through a special page on (This special page: When I started my return, I initiated it at that site. When I went back to finish it today, I want straight to TurboTax. Come checkout time, no discount. So I went back to the original site and saw the note that you need to "Remember to access and complete your return through the TurboTax links on the American Express Web site." Being a dutiful little discount hunter, I clicked the link, re-stepped through TurboTax to the checkout ... and again saw no discount. GRRR.

At this point, I decided further chasing was not worth the $5 and surrendered. But if anyone does manage to use an OfficialPayments discount: What's the trick? Do you also need to open an account there and log in through that? (Something NOT MENTIONED BY AMEX AT ANY POINT ...)

Shock of the day: I itemize

When I get swamped, "tomorrow" tends to get interpreted loosely. Anyway, back into the tax trenches!

Although I finished doing my taxes, I haven't filed them yet: I'm one of the people affected by late tax-law changes that the IRS needed extra time to handle. People claiming the deduction for college tuition expenses were affected by the changes, which the IRS estimated would apply to about 1 million of the 136 million tax returns the IRS expects to process this season. Although, clicking over to that press release, I see a note that "As of 2/3/07, the IRS is Processing Extender Claims" ... so it looks like I can go file as soon as I finish blogging.

Others might also get tripped up trying to file early, though. Various news outlets are reporting rising corrections rates in the 1099s sent to investors with dividends and other investment income. Thanks to tax-law tangles, the error rate on those forms has climbed as high as 14 percent -- meaning that people who file early could face the frustration of finding corrected forms in their mailboxes a few months after they've finished their returns. (You can amend, though it's optional if the error was in the IRS's favor. Even if it's not, unless the error is huge, I imagine few people bother to make the correction. The odds of getting audited remain small and dwindling.)

The last few years I've been stumbling over discoveries of things I can still deduct even though I don't itemize. Last year, it was my tuition deduction: Even though I don't qualify for any of the educational credits (which give you $1 off your taxes for each credit dollar you qualify for), I did max out the $4,000 allowable deduction. Using that cut about $1,000 off my tax bill (or, in my case, added $1,000 to my refund). Sweet.

This year, I discovered that I do itemize. I always assumed we wouldn't have any reason to until we had a mortgage. But there are a handful of other scenarios that can make itemizing the cost-effective thing, and it turns out that the amount we pay in state and local taxes exceeds the standard deduction. (Ah, NYC. Did I mention how depressing it was to go through the TurboTax Local portion and have it wrack up a whopping refund -- until I ticked the 'I live in NYC box'? It actually had a little animation of my refund dollars spinning away as it wheeled its refund-calculation line backwards. When I winged at David about this, he responded, "Your taxes buy subways. It's worth it.")

The practical upshot of this is that for the first time, I'm deducting charitable donations. The downside is that because I always went along assuming "I don't itemize and get no deduction," I never kept the paperwork on our donations. Oops. Guess this is the year I start!

Friday, February 02, 2007

The TurboTax vs TaxACT decision

Our last W-2 finally arrived yesterday, so I plunged right into doing the taxes. Much banging around online turned up no good reviews of the online tax software, grrr. I didn't even find many current reviews of the boxed versions, which surprised me. Isn't this a gimmie for every personal-finance beat writer at any publication of size? PC magazine had one of the only comprehensive bake-offs I could find.

I usually go with TaxACT, but I swore to look elsewhere after running into some minor hassles last year. One look at the prices of "elsewhere" nearly sent me running back. My Amex offered me a 25% discount on the federal-return cost with TurboTax ... but the savings that translates to is actually pretty small, especially since the more-expensive state return isn't discounted. Even with the discount, the total cost for TurboTax online for me will be about $48 -- versus $16 for TaxACT. Ow.

Still .... TaxACT was annoying me, and I'd never tried anything else. The reviewers all swear by TurboTax. Solely for the experience of taking the Cadillac out for a test drive, I decided to shell out and try it. (And hey, blog fodder.)

The interface was indeed a little smoother -- but I'm not sure the end result was any different. I didn't turn up any exciting new deductions I wouldn't have otherwise known about. Plus, TurboTax still had one of the more annoying features that irked me with TaxACT: if you need to go back and revisit something out of order, it's easy to get lost. While working on my state return, I clicked back to the federal return to check out a previously entered amount. That lost my place in the state return workflow, and I couldn't get back -- I had to click through all the fields I'd already entered, costing me an extra 20 minutes of work. Grr.

So, next year, I'll probably save the money and return to TaxACT.

For those allergic to paying full price for tax software, various deals abound. TurboTax has a 15% off deal to anyone paying with a Visa, Amex, MasterCard or Discover. Your financial services providers may have their own deals. My friend Fahmi reports that Fidelity offers TurboTax free to its customers, and PC World is making TaxACT free to subscribers. State Farm also offers TurboTax free for customers.

Meanwhile, if you have an adjusted gross income of $52,000 or less, you qualify for FreeFile -- a program 70 percent of taxpayers are supposedly eligible for. FreeFile deals have all kinds of odd qualification standards, but the IRS helpfully offers a wizard to guide you to an eligible program.

More from the tax trenches tomorrow ....