The Money Mentor: Buying Facebook Stock? 6 Things to Know When Buying Stocks Online

21 May

By:  Lorillia Brown-Phillips, The Money Mentor, Your Black World

The Facebook stock buying frenzy began on Friday May 18, 2012, the company’s initial public offering (IPO) stock image credit: cbsnews purchase price opened at $38 for the general public.  Everyone is talking about buying Facebook stock with the hopes of riding the stock tidal wave of wealth.   While buying a company’s stock can be a great asset class to have as part of your investment portfolio, many novice investors need to be cautious before joining the masses of online stock purchasers.  If you are considering opening a stock account online to begin investing, here are 6 tips to consider before you make your first stock purchase.

  1. Understand Risk tolerance – an investor’s risk tolerance determines if an investor is a conservative, moderate or an aggressive investor.   Knowing your risk tolerance is important before you make any type of investment purchase, conservative investors tend to be risk averse to stock buying, where as moderate and aggressive investors are risk seekers. Always check to see if the online broker’s website has a risk tolerance measuring questionnaire.
  2. Commission & Transaction fees – find out what are the transaction fees being charged to place a stock order.  Many stock trading websites fees range from 4.95 to 9.95 the price can be based on the day of the week, the buying frequency or type of investment selection.
  3. Minimums – do the online broker require an upfront deposit to place an order, make sure minimums are not required to get started.
  4. Customer service – what type of interaction is available to answer your questions; are there live agents to take your calls, live chat sessions or only a FAQ page.   Keep in mind customer service can only answer questions regarding the online trading plat form; many customer service agents that work for online brokers are not license professionals.  This means they cannot give customers advice on their investments.
  5. Investment selection – what type of investments do the online broker provide for purchasing, it’s important to know is the website for only buying EFTs, stocks, mutual funds,   or a variety of investments.
  6. Oversight affiliation –is the online servicer a member of SIPC®, which is the Securities Investor Protection Corporation or FINRA, Financial Industry Regulatory Authority.  Online brokers usually include their affiliations within the footer of the website.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, subscribe to her blog at:


The Money Mentor: Do you know the signs of Debt Related Depression

5 May

It’s no secret or fallacy that Debt Related Depression does not exist, and statistics show that 8 out 10 families have one or even two family members who may be suffering with Debt Related Depression without getting help.    Many individuals ignore the warning signs, and do not get help.  Individuals, who put off treating their Debt Related Depression Symptoms, may experience constant fatigue, panic attacks, anxiety disorders and even suicide.

Discussing Debt Problems

Before an individual can begin to ask for help or seek help, he or she has to admit they have a debt problem.  Individuals who accumulate debt and are unable to eliminate their current or past due debt, always want to blame their debt problems on external factors; for example the lost of a job, a love one, or even society.  Blaming others and not admitting that you have a problem, will only cause a delay with you getting or seeking help.  Debt problems cannot be eliminated overnight, and many people need to understand that reality in order to see the light at the end of tunnel.   Expecting overnight results for a long term problem will only lead to an immediate disappointment.

Steps for handling Debt Related Depression

If you are seeking some relief for DRD and you want to take control of your life.  Here are 8 steps to assist in the process.

  1. Seek help – find someone who specializes with dealing someone who suffers from Debt Related Depression.  Attempting to do it alone can be overwhelming, especially if you have thoughts of suicide.
  2. Stop Spending – if you have access to credit or money, stop spending.  Adding to the problem will only make things worse, some people truly believe living paycheck to paycheck and being in debt and depress is a normal way of life.
  3. Unrealistic goals – don’t expect to get out of debt overnight, put together a long term strategy if you’re doing it alone without professional help.
  4. Don’t Ignore Symptoms – recognizing the symptoms are key, many substance abuse habits are cause by ongoing and long term depression.
  5. Asks your employer – Seek help from your employers HR dept, many companies understand that employees who have problems with debt are prone to take part in embezzlement or any other illegal financial schemes.
  6. Don’t ask for money – Be cautious about asking family or friends for money to get you out of debt.  If you don’t have a plan to pay individuals back the end results will not be nice.  It could even lead to being sued.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, subscribe to her blog at:

The Money Mentor: Student Loan Debt Continues to Rise with Interest Rate Hike

26 Apr

By:  Lorillia Brown-Phillips, The Money Mentor, Your Black World

In the next coming months the current subsidized student loan interest rate of 3.4 percent will be expiring  and the new increase tax rate will be 6.8 percent.   The increase interest rate hike could increase some student loan payments an extra $1,000, which could impact 7.4 million students according to the White House.

Who will be affected

Federal  subsidized student loans that were disbursed  to undergraduate students after July 1, 2011, are the only type of student loans that will be affected by this rate increase .   Student loans that were disbursed prior to July 1, 2011 carried an interest rate of 5.6 percent and higher.  Many industry analyst say that this interest rate hike will only add to the $1 trillion in student loan debt that’s outstanding.   Currently 84 percent of student loan debt is underwritten by the federal government, and that number is expected to rise to mid-90 percent range in coming years.

Remedy for graduating students

Although statistics has shown that student loan debt payments have not increase as rapidly as inflation.  Many college lending experts say,  the cost of college has increased about 498 percent since 1986, while the rate of inflation over that same period has only been 115 percent.  How can students manage their student loan debt,  without facing the chance of a student loan default?  Students who are facing a financial hardship and find making student loan payments difficult, they should contact their loan servicer early after graduation to discuss what options they have available to them.  Those options could result as a deferred payment plan or an income base repayment plan.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, she can  found at:

The Money Mentor: : The IRS Warns Tax Filers about the Dirty Dozen

26 Mar

By:  Lorillia Brown-Phillips, The Money Mentor, Your Black World

Every year the IRS provides  the public with the Dirty Dozen tax scams, that tax payers should be aware of to protect themselves from tax payer fraud. The tax filing season ends on April 17, and there are still some tax payers who will wait until the last minute to file their taxes. If you are one of those last minute tax filers, it’s important you are aware of the wide range of schemes ranging from identity theft to preparer fraud.  Here are just six of the Dirty Dozen tax schemes.

  1. Identity Theft – IRS says identity theft tops their list for tax schemes because of the growing cases throughout the US.  The IRS has put in place a comprehensive strategy for preventing, detecting and resolving identity theft.  IRS wants to warn taxpayers that identity thieves are constantly looking for ways to file fraudulent returns to get a tax refund.
  2. Phishing – Be on the lookout for disguised emails that resemble an IRS correspondence, encouraging tax payers to provide personal information.  The IRS will never contact tax payers through email, report all weird emails to
  3. Return Preparer Fraud – Beginning for the 2012 tax filing season, tax preparers who are not licensed CPA, EA or attorneys, have to apply for a PTIN to prepare taxes for the public.  All tax preparers must sign returns and provide their PTIN on all returns.
  4. Free Money” from the IRS & Tax Scams Involving Social Security – Flyers have been distributed to community churches around the US, claiming that tax payers can file with little or no documentation.  These scams have been successful preying on low income or elderly individuals.
  5. False Form 1099 Refund Claims– Perpetrators create false 1099 tax forms to claim credit or deductions that are not allowed.  The IRS has warned individuals that if are party to these claims will be liable for financial penalties or even face criminal prosecution.
  6. Falsely Claiming Zero Wages – Filing false information returns such as W-2 or 1099 is an illegal way to reduce taxable income to zero.  Fraudsters will file tax form 4852 as a way to properly support their false tax filings.  Individuals who take part in this scam may face a harsh penalty of $5,000.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, she can  found at:

The Money Mentor: Are You Being Haunted by Old Debts?

8 Mar

By:  Lorillia Brown-Phillips, The Money Mentor, Your Black World

Have you ever been issued a credit card that was charged off due to non payment?  Did you know that a charged off credit card balance is considered taxable ordinary income, according to the IRS.  Charged off credit card debt that is either canceled or forgiven may cause taxpayers to receive a 1099-C.  A 1099-C is a tax form issued to taxpayers if they incur $600 or more in canceled or forgiven debt.  The issuing company must be applicable entity which includes a: financial institution, credit union, federal government agency or a money lending company.

Exceptions to the rule

There are exceptions for not reporting the 1099-C as ordinary income.  If you were insolvent or the debts were discharged in bankruptcy you are exempt from reporting the amounts on your income tax return.  The IRS has provided worksheets that taxpayers must use to prove their insolvency.  Keep in mind that your debts have to exceed your assets, and your insolvency is reported on IRS Tax Form 982.

Debts that were discharged in bankruptcy are not taxable.  But if you still received a 1099-C you still have to report the income, keep in mind to exclude the income you have to use IRS Tax Form 982 to report the exclusion.

Ignoring will not help

If you are in disagreement with the organization that issued you the 1099-C, do not ignore the tax form and refuse to file the tax form.  Keep in mind, any tax form that has been sent to you in the mail has also been reported and filed with the IRS.  If you believe the tax form has been sent to you in error, call the institution that issue you the form and see if they will revise the tax form sent in error.  Always consult with your accountant, CPA or tax advisor, if you feel overwhelmed and need guidance on any tax matters.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, she can be reached at

The Money Mentor: How to Manage Debt for Married Couples

2 Mar

Committing to a marital partnership can be one of the most intimidating life events that two individuals may face.   But when you add personal finances woes, for example uncontrollable debt to the mix;   the combination can be lethal to a relationship.  Debt problems can either arise before a marriage or during the marital union, recognizing the warning signs are key.  Here are 6 tips to help married couples manage and eliminate debt.

  1. Make small strides.  To eliminate debt, start with the smallest to the largest debt.  Make a spreadsheet with a combination of separate and joint debts, and make a plan to contribute extra money to eliminate the smallest debt first.
  1. Identity is important.   Once the debts are put in a spreadsheet listing, its important to determine what is current, late or a defaulted debt.  Identification is key, you always want to continue to pay current debts on time, bring late payments up to date and put together a strategy to tackle defaulted debts.
  1. To separate or not separate.  Debts that were accumulated before marriage are a sensitive matter and should be approach with caution.  Decide how the debt will be a paid down and decide if it will be paid from a joint or separate bank account.
  1. Commit to savings.  A savings plan should be set up to work systematically on an ongoing basis.  Creating an emergency savings plan of 9-12 months of expenses should be a goal to reach by both spouses.
  1. Don’t argue.  Arguing will never provide solutions to spouses who are having financial problems.  It only causes a blame game session with no end results. Instead of arguing, couples should face their financial problems together and put together a realistic strategy that both spouses can commit too.
  1. Don’t keep secrets.  Whether the debt was accumulated before or after the marriage, secrets are never a good thing.  Both spouses should commit to a personal oath to one another, this will deter sneaking behind each other backs; that will only cause  havoc once the truth comes to light.

About the Author:  

Lorillia Brown-Phillips is a Financial Literacy Educator and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, she can be reached at

The Money Mentor: IRS Cracksdown on Identity Theft in 23 States

31 Jan

By: Lorillia Brown-Phillips, The Money Mentor, Your Black World

Since the IRS open the tax filing season on January 17, 2012, the Justice Department’s Tax Division and local U.S. Attorneys’ Offices targeted 105 people in 23 states on indictments, arrests and the execution of search warrants involving the potential theft of thousands of identities and taxpayer refunds.  Along with 939 criminal charges which included 69 indictments and information related to identity theft.

The identity theft crimes took place in money service businesses also called check cashing stores.  Many check cashing stores are highly trafficked money outlets that service the unbanked and underbanked population.  So far the IRS has made surprise compliance visits to 150 check cashing facilities throughout the US.  According to the website the commissioner Doug Shulman said, “This unprecedented effort against identity theft sends a strong, unmistakable message to anyone considering participating in a refund fraud scheme this tax season.”

Currently, the IRS plans to perform compliance audits to more than 250 check-cashing operations across the country and will be looking for indicators of identity theft as part of the exam effort.  The information from these audits and compliance visits will be used to assist continuing IRS investigations into refund fraud and identity theft.  Some of the US states that are considered high-risk are Atlanta, Birmingham, Ala., Chicago, Los Angeles, Miami, New York, Phoenix, Tampa and Washington, D.C.

About the Author:

Lorillia Brown-Phillips is a Financial Advisor and Author of “Jump Start Your Credit: How to Negotiate and Settled Your Debts in 10 Steps”, she can be reached at