Today’s link round-up takes a more detailed look at a few finds in the personal finance space this week:
Is The Recession Over?
Jim at Bargaineering asks this week whether the recession is over. The numbers claim we’ve been “done” since June of ’09, but the word on the street tells a different story.
I tend to side with Jim’s take:
“…ultimately a recession is defined by people, not numbers (numbers lie!).”
I’ve never really been a fan of the traditional definition of recession because it’s too narrow (only measures one indicator). Clearly, with unemployment in my county still over 12%, the end of the recession seems far ahead, not behind us.
We keep on trucking for now…
Do Renters Pay Property Insurance?
I believe they do, at least indirectly. Sam presented a different take this week at Financial Samurai and suggested we implement a renter’s tax.
I would argue that the property on which renters live has its taxes paid by the landlord (i.e. property owner). Whether that comes directly out of my rent or out of the landlord’s other funds is irrelevant in my opinion because ultimately, the taxes are still getting paid.
No rent leads to no landlord income leads to no taxes paid.
At the end of the day, a renter’s tax would be a case of double taxation (which in itself is already prevalent in U.S. tax codes), but we’re looking for a fair solution, and this would not be it.
Sam argues that we can’t account for rental income on the landlord end, and therefore there is no correlation. A few selected excerpts from Sam’s comments:
“…who is to say the rent I collect is for property tax? The rent I collect from tenants is used to pay for my vacations. Now do you see the flaw in your reasoning?”
“Nope. Landlords charge tenants RENT. The government charges people taxes. This is a KEY difference which you and many others are missing.”
“We have double and TRIPLE taxation all the time in the States. Dividends are double taxed as it comes after net profit, if you sell a car 5X you have to pay tax. Do you honestly think when you pay your rent, it is going towards funding the local community?”
Share your thoughts on Sam’s post. Is there a correlation between rent and the taxes the landlord pays or am I getting this all wrong? Would you pay a renter’s tax?
Are You Investing Your HSA Funds?
One of the best financial moves we’ve made in the last year is switching to a HDHP (high deductible health plan) with an associated HSA (health savings account).
This allows us to pay significantly lower premiums while socking away most of the difference in a tax-sheltered account. We have to pay for many more things out-of-pocket, but even if we used up all of our deductible, we’d still be ahead of the traditional insurance alternative. More on the math in an upcoming post…
Meanwhile, Five Cent Nickel talks about another side of HSAs–investments. Most HSA accounts will allow investment of the funds once the account hits a certain funding level. Apparently, not all HSA investments are created equal:
“The available funds include a handful of Fidelity Advisor Freedom funds as well as a bunch of First American funds. Care to take guess what the fees look like? Every single fund has a front-end sales load ranging from 3.50% to 5.75%, and the ongoing expense ratios are also quite high, in the 1.25% range. This is totally unacceptable, so we’ll be taking our business elsewhere.”
That’s complete craziness. In this day and age of transparency and competition, fees of 3-6% are nothing short of a ripoff. The HSA company is hoping that you’ll feel “trapped” by your options and invest. Shame on them.
If you do take advantage of HSAs, make sure your investment options (if you choose to accept them) are solid choices.
I’d like you to check out IttyBiz, a blog I just recently discovered, and one of the funniest writing I have ever seen on the web. IttyBiz is a self-proclaimed “marketing [website] for businesses without marketing departments.” Lives up to its cause.
Also, if you have a garage full of clutter, I’d like to point you to Man vs. Debt, where Adam recently released his “Sell Your Crap” guide for turning your “clutter into cash.” This eBook is jam-packed with goodies.
Happy Hump Day. What good stuff have you read lately? Share links in the comments!