Workers Earning Less Now than at the Height of the Recession

If you have ever wondered why you don’t seem to be able to stay on top of your bills, a recent report issued by the New York Times can answer that question quite easily. You are probably earning at least 6.7% less than you were during the height of what is being called the Great Recession.

It is difficult enough to keep up with recurring bills such as utilities, rent/mortgage, automobile payments, credit card bills but when you are earning $6.70 less on every hundred you make, it is almost unbearable. Not only are you earning less, but prices just keep on going up. Inflation is at a breakneck speed and it does not appear that it will level off any time soon.

According to a study conducted by two former officials of the Census Bureau, the median household income is now at $49,909 which marks a total decrease of 6.7% from December of 2007 when the recession officially began. During the recession household income only fell 3.2% which is why it is so dismaying that we have fallen so low when Washington tells us the recession is over.

Americans are not only unhappy with the current state of affairs, they are downright angry. When polled, most people state that leaders are letting them down and that it’s politics as usual. This does not appear to be good news for either the Democrat or the Republican parties as the caucuses are in full swing.

President Obama is calling the financial situation an official ‘emergency’ and is asking for Congress to pass his jobs bill. Many analysts feel that it doesn’t stand a chance of passing even though there are some strong spots in the bill. However, at a cost of $477 billion, it is more than Washington is prepared to spend at the moment. The bill itself is a blend of public works, tax cuts and unemployment benefits which Republicans are none too pleased with.

The two men responsible for the report on the current state of household income, John F. Coder and Gordon W. Green, Jr. find that the American standard of living is significantly reduced. Oddly, our standard of living is reduced but joblessness is waning as well. They find that there are two main factors contributing to this situation.

First of all, there are growing numbers of people outside the workforce. These are categorized as those neither working nor seeking a job. The second factor is that hourly pay is being held low and is not in keeping with the rate of inflation. Of note are the rises in the cost of oil and food which have risen significantly. What is most surprising about these facts is that during the recession, wages rose faster than inflation.

The pair noted that a great number of people who became unemployed during the recession had to take a sizeable decrease in pay just to get a job again. In fact, the situation is so critical at the moment that many of the country’s leading economists claim that the recession is far from over.

For the average consumer in the United States, this means tightening our belts and really keeping an eye on our own debt. If all you can make is minimum payments, then at least keep up with them. Economists suggest that we charge less, pay more and watch our own personal finances. We could be in for the long haul if things don’t improve soon.

Also, take the time to keep track of your credit report because hard economic times also tend to lead to rising amounts of identity theft. Make sure to order your annual free credit report and score so that you can make sure that everything on your report is of your making. If not, dispute it as soon as possible. Times are not getting easier and you need to know that any debt on your report is fair and accurate.


The Latest in a Series of Attempts to Curb Credit Card Fraud

One of the reasons why we are urged to monitor our credit reports is because of the huge amount of credit card fraud that has been plaguing consumers around the world. Recent research has indicated that banks are among the easiest to infiltrate simply because their automated tellers on the phone require so little information before giving the caller access to your accounts. New technology which rolled out last month is an effort to ensure the identity of the person using the credit card in an effort to prevent fraudulent use of other people’s credit information.

What many people might not understand is that the thief doesn’t actually need to have possession of your card. Yes, there are times when your credit cards are lost or stolen, but credit card fraud is most often the case of someone gaining access to your account number and your personal identifying information such as your address and/or phone number and sometimes even the three digit security code on the back of the card.

New technology is rolling out almost by the day to help prevent identity theft and the newest ‘gadget’ is something called Netswipe which made its debut in August of 2011. There is also a plug in for Word Press that does much the same thing. The principal behind both innovations is that the person ordering online is able to ‘swipe’ their card with a web cam and the merchant is then able to verify that the person ordering a product or service is actually holding the card and entitled to use it. Remember, the bulk of credit card fraud is the result of unsavory characters getting hold of your credit card info but not actually having the card itself.

For the consumer, this is good news because it is another mode of identity protection that can help them keep their credit score in good standing. For merchants, it could be a good thing as well because the cost of such innovations as Netswipe is significantly lower than traditional card swipe systems merchants currently employ. The developer of Netswipe, Daniel Mattes, is going to charge 2.75% for processing fees which in reality is perhaps less than half what most merchants are currently paying.

The bottom line for consumers is the fact that greater care is being taken to protect their identities. There has been so much identity theft over the past couple of decades that many consumers have unsatisfactory credit scores as a result. It will still be necessary to monitor your credit report from each of the three credit scoring companies (TransUnion, Equifax and Experian) because there still isn’t a foolproof way of protecting your identity 100% of the time.

Some consumers choose to order one report every 4 months so that they can have an idea of what is going on with their report throughout the year, but this may present some inherent problems. One thing which many people aren’t aware of is the fact that companies and lenders do not all report to the same agencies. For example, your mortgage holder may report to Experian whereas your credit card company may report to TransUnion and so on.

In order to monitor your credit report throughout the year, it may be better to contract with a credit monitoring company that charges a monthly fee. These companies notify you by email, text message and sometimes even by phone whenever a change is made to any of the reports they are monitoring. If you didn’t make a recent purchase then you can immediately dispute charges before the damage is done. Until such time as a foolproof identity protection system is in place, take the time to monitor your credit report.


Caller ID Spoofing Gives Rise to a New Level of Identity Theft

In recent news, there has been a lot of attention given to a new way in which potential thieves are accessing our personal information. Although criminals have been using something known as ‘caller ID spoofing’ for years to defraud consumers out of money, it is now feared that they will be using spoofing to steal our identities in order to charge thousands of dollars against our name.

What Is Caller ID Spoofing?

Anyone old enough to remember back to the days when caller ID first came out will remember the joy we felt at being able to tell whether or not we wanted to answer the phone. “Oh, it’s just my mother-in-law, let’s pretend we aren’t here!” For years this helped us to avoid the ‘bill collectors’ if we didn’t have the money to pay or to avoid those annoying sales pitches during dinner. However, new technology is able to make it appear as though the person calling is other than who they are. In other words, if you subscribe to a caller ID spoofing service you simply tell the program what number you would like to pop up on the recipient’s caller ID and that’s just who they think you are.

How Caller ID Spoofing Can Affect Your Credit

Consider for a moment that with this service it makes it possible for thieves to access your bank account via telephone to gain information such as how much money you have in the bank, where you made your most recent purchases and even what kinds of deposits are automatically made to your account each month – and worse yet, what day of the month they are made! Remember, the bank’s automated system ‘thinks’ the call is coming from your phone number and will then start detailing the items requested.

Chase and Bank of America Not Well Protected

In an article posted in the New York Times, a consumer advocate named Edgar Dworsky put the theory to the test. Armed with just a bit of the consumer’s personal information, Mr. Dworsky called the automated systems of Chase and Bank of America for credit card holders. The article refrained from stating what that information is for fear of unleashing further thieves on an unsuspecting world, but the article did go on to say that Dworsky was successful at both of those financial institutions. The automated systems recognized the spoofed phone number as being that of the consumer and proceeded to give over the information Dworsky requested.

Not Enough Being Done to Protect Consumers

According to the article in the Times, both phone companies and card issuers can do more to protect their consumers but strict enough measures are not being taken. It is reported that their excuse is in terms of customer convenience. Bank of America and Chase are reported as saying that customers use automated systems for the convenience and that if they have to enter too much identifying information it will just defeat the purpose. However, given the choice between being left open to identity theft and a bit of inconvenience, most consumers would probably gladly spend a few extra moments entering identifying info.

At a time when we are having enough problems keeping up with our credit report and maintaining creditworthiness with a decent credit score, caller ID spoofing is the straw that broke the camel’s back. Since there is no immediate solution to the problem, it is recommended that you continually monitor your credit report and make doubly certain you never divulge your information to anyone on the other end of the line unless you are 100% sure you know the identity of the caller. Until stronger security measures are in place, this may be your best line of defense.