Terry Savage

Raising tax rates above a certain level, actually reduces tax revenues! It's a fact of history, and those facts are in my Sun-Times column, Monday, July 20th.
We want our government to provide more for us -- everything from health insurance to mortgage restructuring. But how will we pay for all of this? The lessons of history show that cutting taxes increases economic activity --and brings in more tax revenues.
Please read the column http://www.suntimes.com/business/savage/1674096,CST-NWS-savage20.savagearticle -- Then feel free to post your comments.

Was it the banks, for extending too much credit?
Was it Congress -- for encouraging consumer spending to keep the economy going, and delaying credit card reforms until 2010?
Or was it the people who used their credit cards to get into debt?
And before you answer that --what would you be doing if you lost your job, ran out of unemployment benefits and needed money to feed your family?
Your thoughts are welcome here!
UPDATE 7/21/09:
Bank of America, the largest bank in the country, reported its default rate
jumped to 13.8% in June from 12.5% in May. Defaults, or charge-offs, are the
debts that a lender believes it will never collect.

No wonder they're raising rates, fees! Lots of people aren't paying!

This great debate will impact YOU -- whether you're a young worker or a retiree hoping Medicare will cover everything (it won't). The subject is complicated, the solutions are incredibly difficult. And the fix will be created by politicians who are impacted by all the money involved in the industy.

It's tempting to just close our eyes and let "them" solve the problem. Let's not do that! Please post your thoughts on Healthcare Reform. Here are just a few things to think about:

Are we willing to make choices?
• Will we ration healthcare, based on age, or condition or ability to pay?
• Will we strike a balance between diagnostic medicine and "lawsuit prevention" medicine?
• Can we even agree on an electronic system for healthcare records that provides adequate security and privacy?
• And can we cut healthcare costs if the insurance system doesn't create a reason for people to know and care about the costs?

I look forward to your comments, and will use them anonymously in a future column. And here's a link to find your Congressional representative's email address, so you can let them know how you feel!
https://writerep.house.gov/writerep/welcome.shtml
http://www.senate.gov/general/contact_information/senators_cfm.cfm

ONE FUND within theI llinois Bright Start College Savings plan suffered a huge loss not directly related to the stock market decline. It was a bond fund that should have provided low, secure, and positive returns. Instead, it appears that the Fund Manager took extreme actions with the portfolio, resulting in a loss of more than 30 percent of the value of this fund, which is included in the age-based portfolios.
State Treas Alexi Giannioulias is threatening to file suit to recapture the $85 million lost because of this bond fund.
IMPORTANT: Losses in stock market funds are to be expected in a bear market. So thisis not an attempt to recoup market losses in the stock funds.
Please post your comments here, and I am sure the Treasurer and AG will be looking at these personal stories!
Here's a link to that column: http://www.suntimes.com/business/savage/1376279,CST-FIN-savage14.savagearticle

On Monday, January 21st I posted a column with a "Dear Santa" wish list for our new President. And I asked you to join in, adding your ideas to the list!
Here's a link to the column: http://www.suntimes.com/business/currency/1384986,CST-FIN-terry19.savagearticle
I'm looking forward to your comments!

Congress has passed and the President signed (on Tuesday, Dec 23rd) H.R. 7327, the Worker, Retiree and Employer Recovery Act of 2008, a bill that places a one year moratorium on required minimum distributions from Individual Retirement Accounts and defined contribution plans for 2009.
To Clarify my earlier post (and thanks to a sharp-eyed reader who caught my unintended error as I posted in December, before knowing details of the bill):
The suspension of required minimum distributions applies to 2009 distributions, NOT 2008. Therefore, you should have taken the 2008 required distribution before year end. If you did not, you may face a 50% penalty on the amount you "should" have withdrawn.
There may be some exceptions made because of the confusion at year end. BUT, if you did not take a 2008 RMD, you should immediately contact your plan custodian and arrange to do so!
.

Monday, December 15th -- Should we use taxpayer money to bail out the automakers?
If you subscribe to my free newsletter (www.TerrySavage.com -- just fill in the little "pop-up" box) you'll know that I have mixed feelings on that issue.
One thing is sure: Like a parent coddling a spendthrift young adult, you can't keep throwing good money after bad, jeopardizing your own retirement plans, without demanding some CHANGE! What do YOU think?