Frustrated by customer service?

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We asked career customer-service experts—including Consumer Reports “acquisition” pros, who pose as regular consumers to sign up for services and buy the thousands of products we test—what works for them on the job or at home.

1. Pick up the phone
Eighty percent of those who participated in our national survey contacted a company that way. Half of them said it was the most effective way to resolve an issue. Real-time contact is often more efficient than e-mail, where there can be a wait of 24 to 48 hours for an answer, said Sharon Parker-Odom of Carmel, Ind., a Consumer Reports Facebook fan who worked in customer service for 26 years, three of them in call centers. Need a company’s number? Look under “investor relations” or “news,” or try websites such as Dial a Human and Get Human.
2. Cut your hold time
Try a free Web service like Lucy Phone, where you enter a company’s name or number, then give the service your phone number. It calls you back when a rep comes on the line.
3. Bypass automated menus
The old ploy of pressing “0” (with or without the “#” sign) sometimes works. Another option: Forget support entirely and press the prompt for “sales” or “to place an order,” when companies are likely to roll out the red carpet. Dealing with a TV provider or telecom company? Leapfrog service and go directly to customer retention, where agents are empowered to negotiate.

4. Show—and ask for—empathy

Many customer-care reps are low-paid workers subject to poor treatment, and their opinions are rarely sought. If you’re in a store, act with sensitivity if you notice one of them being abused by another customer. When making your case, end with the words, “Can you help me?” He or she might not have the authority, so instead of making insults, politely ask to speak with a supervisor. You also might want to say, “Don’t you agree?” or “Would you want that done to you?”
5. If nothing else works, escalate
We never suggest that you become uncivil, but if you’re stuck, be forceful. Companies rely on voice-recognition software to detect anger, sarcasm, and inflammatory phrases like “you people,” and will swiftly transfer you to an operator.
6. Try live chat

The option, if available, is just as effective as using the phone and is often faster. It also results in a transcript for follow-up purposes. Chat reps tend to be more senior than phone reps and have greater decision-making authority, said John Goodman, vice chairman of Customer Care Measurement & Consulting.

7. Build a case

You don’t have to be a lawyer to get satisfaction, but it helps to think like one. One of our shoppers was recently surprised when Verizon FiOS pulled the Weather Channel from his TV package, replacing it with the company’s own version. When he asked why it was removed, the response was a terse, “We’re just not doing it anymore.” So our shopper went Perry Mason: “ I signed a two-year contract; you changed the lineup and altered our agreement. The way I see it, that contract is null and void.” The representative ended up giving him a discount on his bill.

8. Tell your (Facebook) friends

Many companies actively monitor social-media sites to intercept problems before they go viral and do greater damage, so you’re likely to get a quick response, Goodman said.

9. Take it to the top
Contact the president’s or CEO’s office and ask to speak with an assistant. Or write the chief executive directly. Less than 2 percent of consumers do that, Goodman said, so executives pay attention.

10. Seek outside help

The Consumer Financial Protection Bureau offers assistance with problems involving financial products and services such as loans, leases, debt collection, credit cards, and banks. File a complaint at consumerfinance.gov/complaint, and the federal agency will forward it to the company and work to get a response within a specified time frame. You can also share your story to help protect other consumers.

11. Cancel and come back

Cable companies used to trip over each other trying to snatch a competitor’s customers with enticing incentives. These days, they seem to have no qualms about letting you walk. But believe it or not, that can work to your advantage. When the half-price HBO promo ended for one of our shoppers and the cable company refused to extend it, he dropped the package. “Once I quit, they offered it to me again—in the same phone call,” he said. Another shopper dropped Cablevision completely when his bill skyrocketed. After he quit, the company was willing to deal to regain his business.

Culled from Consumer Report

Would you buy an engagement ring from Etsy?-By Mandi Woodruff

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Dane Henze purchased his fiancee's champagne sapphire engagement ring and wedding band from Etsy shop EidelPrecious. (Photo credit: Ali Walker/Aliwalker.com)

Newlyweds today spend one-fifth of their wedding budget on the perfect engagement ring, which, at an average price of $5,855, is four times what the typical bride will spend on her own wedding gown and second only to the venue as the most expensive part of their big day.

But some couples are bucking this trend, looking for affordable alternatives to the traditional diamond engagement ring on Etsy (ETSY). The online marketplace, which went public in April, is probably better known for crafty wares like handknit scarves and small batch soaps than its growing legion of independent jewelers. A company spokesperson declined to share exact figures on its jewelry market, but a search of the site turned up 1.2 million results for “handmade rings,” which made up about 13% of all jewelry listings.
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Etsy’s jewelry business is likely nowhere near as strong as that of leading online jeweler Blue Nile, which banked $473.5 million in net sales last year and currently owns around 8% of the $4.7 billion online jewelry market in the U.S. Ebay, long seen as a treasure trove for people looking to buy used and vintage rings at a steep discount, is a stiff competitor as well. But Etsy has a different kind of appeal altogether, especially for a younger generation that is just as concerned with thrift as they are with personalization. “Etsy is a place to shop for unique designs,” says Etsy merchandising expert Emily Bidwell. “You can talk to the seller and ask for specific aspects you want in your ring.”  

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Samples of engagement rings from Etsy.com.

Jillian and Dane Henze were in their mid-20s when they became engaged in 2011. Jillian was a reporter at a local newspaper; Dane worked for a nonprofit focused on the environment. “We were really poor,” Jillian says. Together, they casually browsed the velvet-lined ring cases at several local jewelers near their hometown of Turnwater, Wash., to find a ring that suited Jillian’s tastes and Dane’s budget. The one ring that caught her eye — a white-gold band with a yellow diamond perched at its center — turned out to cost $13,000. “I just about died,” Jillian says. “We had been saving but we didn’t want to have this huge debt.”

After watching several friends get engaged, she knew she wanted something unique. Inspired by the idea of a colored stone, she started browsing bridal blogs and came across a link to an Etsy shop that featured rings with different hued sapphires. The idea of purchasing a ring online was a non-issue. “We’re young and we had already purchased so much online,” she says. “It was normal.”

It was also significantly more affordable. The ring Dane selected, a champagne-colored sapphire on a white gold band dotted with miniature diamonds, cost only $1,200. And other than a slight shipping hiccup — the seller, based in Canada, had to delay shipping by couple of weeks after the country’s postal workers went on strike — the process was smooth. Jillian was mostly worried getting the right size, but it fit her perfectly.

“People still compliment me on my ring all the time,” she says. “And I get to tell them, ‘Oh thank you, it was handmade by a woman in Canada!’ It’s kind of fun.”

The online jewelry market is small but growing. Online retailers make up more than 10% of jewelry and watch sales so far in 2015, up from 8.2% in 2010, according to market research firm IBIS World. (However, their data does not include sales figures from sites like Etsy and eBay).

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Jane Strauss, 60, has been selling handmade wedding and engagement rings on Etsy since 2009. The Morristown, N.J., sales analyst runs the business on the side with her older brother, a longtime gemologist. Strauss works with customers to design and customize their rings to their tastes — they mostly work with sapphire and topaz — while her brother sources the stones and cuts them to their customers’ liking. Their prices range from a couple of hundred bucks up to $6,000, but people rarely purchase items over $1,500, she says (Etsy makes 20 cents off each listing and takes 3.5% of the transaction price). Like many jewelers who sell on the site, they patent their designs, which serves the dual purpose of thwarting copycats and giving customers peace of mind that what they are buying truly is unique.

Strauss, who once owned a boutique jewelry store in the 1980s, admits she’s still secretly surprised every time she makes a sale.  “It’s hard for me to fathom people will buy jewelry online, especially an engagement ring, but they do,” she says, which is why she goes out of her way to make customers comfortable. “I’m big on educating my customers and we’ll send them pictures during the whole process. Sometimes it takes 15 [e-mails back and forth] to close the sale.”  

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Mike Neumayer (pictured) poses with his fiancee's engagement ring, purchased from Etsy shop Beautiful Petra.

While Strauss runs her Etsy shop as more of a side gig — she sells only a few rings per month — Petra Hein, 32, has turned her Etsy business, Beautiful Petra, into a six-figure juggernaut. Since opening in 2009, she and her husband/business partner now sell 60 to 90 diamond engagement rings a month. Some of those sales come from Pinterest and Facebook. Hein is one of few sellers on Etsy to sell mostly diamond rings, and, as such, her wares come on the pricier side, ranging from $3,000 to $10,000. She offers customer payment plans and also suggests diamond alternatives like cubic zirconia or moissanite, which can slash the price by hundreds of dollars.

“Most people are interested in our unique ring designs, not the diamond,” Hein says. “Instead of financing a diamond, they can put a CZ and they can replace it in a year or five or 10.”

Mike Neumayer, a 26-year-old from Vermont, purchased his fiancee’s ring from Hein’s Etsy shop last year (he noticed his fiancee had pinned several of Hein’s designs to her Pinterest board). Neumayer liked the idea of supporting an independent jeweler but wasn’t sold on buying the ring online. He ended up purchasing his fiancee’s engagement ring from Hein’s shop with only the setting and picked out the diamond, in person, at a local jeweler.  Hein worked with him to ensure the setting would fit the diamond.

“It blows my mind that I was able to order something online, handmade, and be on a first-name basis with the creator while I called her cellphone to discuss product options,” he says. “It’s nice to know that the majority of the money you're spending on the item goes to the people creating and selling it.”

If you’re thinking about buying an engagement ring — or jewelry in general — from Etsy or elsewhere online, there are some best practices to follow. “There’s always a challenge of buying online when you don’t actually see something,” says Celia Gardner, president and CEO of the Jewelers Vigilance Committee, an independent organization that regulates independent jewelers.  “You need to have a sense of who you’re buying from, make sure they are reputable and that they will be there tomorrow.”

Read the reviews. There’s a special team at Etsy dedicated to following up on user complaints and ensuring sellers abide by guidelines. But overall, Etsy customers rely heavily on user feedback. For sellers like Strauss who only sell a few rings per month, even one bad review can hurt business.  

Check return/refund policy. Etsy sellers are free to use whatever exchange policy they deem fit, a spokesperson says. Many sellers don’t allow returns for custom orders, however. Petra gives most customers five days to return rings they aren’t happy with. Strauss doesn’t allow returns on custom orders but will take returns on items she had in stock already. A good repair policy is important, too. Jillian Henze’s seller offers a two-year warranty. When one of the tiny decorative diamonds on her band popped out of its setting, the seller sent a replacement free of charge.

Ask for an itemized receipt. Amanda Gizzi, spokesperson for Jewelers of America, suggests asking for an itemized receipt that shows the cut, clarity, carat, and type of metal the gem is set in, as well as the total purchase price. “That way, when you do get an independent appraisal, which you’ll need for insurance purposes, you’ll be able to know exactly what you paid for.”

Ask about resizing. Some Etsy jewelers may not offer to resize rings, so check the fine print first. It pays to get fitted for a ring before shopping online. Neumayer’s fiancee realized her engagement ring was too large and they had an independent jeweler resize it.

Get it appraised and insured. It’s highly recommended to insure your engagement and wedding rings, which requires an appraisal. Strauss recommends going to an independent certified jewelry appraiser. It’s a smart idea to get the appraisal during your seller’s return/exchange window, too. If the appraiser raises any issues with the stone’s quality, you may have a better chance of getting the seller to rectify the matter. Etsy doesn’t require sellers to send certificates of authentication with its jewelry, so it’s up to buyers to read the fine print or ask the seller what their policy is. A good sellers should be happy to  have an independent certified gemologist check the ring out or send it directly to the Gemological Institute of America for certification. Just be prepared to pay an additional fee, generally $200 to $400, Strauss says.

Use your credit card. Like any major purchase, it’s safer to use your credit card when buying a ring online than your debit card. Some credit cards have pretty liberal purchase protection policies. If the deal goes bad or you feel you’ve been wrongly charged and the seller won’t refund you, there’s a good chance your credit card will. Review your credit card policy beforehand.  

Keep an eye out for fraud.  All Etsy sellers, whether U.S.-based or international, have to adhere to Etsy’s strict seller policies. Reselling — purchasing something from a store and passing it off as “handmade” — is arguably the biggest no-no of all. Etsy has a special team dedicated to weeding out bad actors, but the company has faced criticism on that front for some time, even driving some long-time sellers to abandon their shops in protest. The biggest clue that a product has been mass produced is the price tag. Dirt cheap and handmade rarely go hand in hand. 

Culled from yahoo finance

Americans left $24 billion in retirement money on the table last year -By Dan Kadlec

Personal savings rose last year, as conscientious workers reined in their spending. But a smaller portion of those savings were stashed in employer-sponsored retirement plans, new research shows. This and other recent findings suggest that the much-vaunted 401(k) match may not be the silver bullet for retirement savings that is widely presumed.

Personal savings jumped to 5.5% last year from 4.6% in 2013, according to data from Hearts and Wallets, a financial research firm. In the same period, average household savings allotted to employer-sponsored retirement plans fell to 22% from 29%. Among households eligible for a plan, only 56% participated, down from 60% the previous year.

Partly due to such behavior, Americans leave a staggering $24 billion on the table every year simply by not contributing enough to get their full employer match, according to a study by Financial Engines, a 401(k) advisory firm. Last year about a quarter of employees failed to collect their full match, which added up to $24 billion in lost savings. The average worker missed out on $1,336 a year in free money—over 20 years, that can add up to $43,000.

The matching contribution is so ineffective at boosting savings that one third of eligible workers past the age of 59 ½ fail to take full advantage, research out of Yale and Harvard shows. That’s an especially dismal showing because these older workers can make penalty-free withdrawals from their plans.

If a 401(k) plan match is free money, why don’t more people take advantage? Inertia explains a lot. That’s why so many employers are switching their plans to automatically enroll new workers and automatically escalate their contribution rate. Another issue is that some workers don’t believe they can get by on less than their full take-home salary, and so they do not enroll or opt out of the plan if they have been automatically enrolled.

Typically, those who miss out on the match tend to be low- and middle-income workers. Ironically, this group would benefit the most from participation because the match would represent a bigger percentage of their income. A typical middle-income worker would more than double his or her annual savings just by raising the contribution rate to get the full match, Hearts and Wallets found.

In the end, the biggest beneficiaries of the 401(k) match are highly motivated savers, who tend be the most highly compensated. That’s why some policy experts and academics have raised questions about the fairness of corporate tax policies that encourage employers to offer a match. Maybe better public policy would be to redirect those tax dollars toward fixing Social Security, which benefits the low-income households least likely to save on their own and who need help the most.

Of course, any changes to tax policy aren’t likely to happen soon. All the more reason to make sure you are saving enough to get your full 401(k) match. Chances are, you won’t notice the difference in your take home pay—it helps that you get a tax break on the amount you sock away. To see how stepping up your savings will get you closer to your retirement goals, try this calculator .

Culled from Money.com

Money Minute: 5 credit card perks you never knew you had-By Mandi Woodruff

Your credit card is good for a lot more than paying bills and racking up miles. Here are five little-known perks you never knew you had. 

Lost baggage protection. If you book a flight using a credit card, you may be covered for up to a few thousand dollars if the airline loses your bags. Even if your baggage is only delayed a day or two, you’re probably covered as well. Some credit cards will reimburse you for a few day’s worth of clothing and toiletries. For example, the Chase Sapphire Preferred card covers up to $100 per day for five days when baggage is delayed more than six hours. Just be wary of annual fees these cards may charge. The Sapphire card gives you one year fee-free but charges $95 thereafter.

Refunds and returns. If you want to return something but the company won’t take it back, your credit card company might refund you. The same perk applies if you were wrongfully charged by a merchant and they refuse to refund you. Again, for this to work you have to make the original purchase with your credit card. Some card issuers, like Discover, even cover you if your item was stolen within 90 days of purchase. This is yet another reason it’s smart to buy expensive items on credit, rather than debit.

Extended warranties. Let’s say your brand new big-screen TV or washing machine dies on you just a few months after your warranty is up. If you purchased it with a credit card that has extended warranty coverage, your issuer may offer to replace it, fix it or reimburse you for its value. The limits on reimbursements vary from card to card so check with your company. In a recent study by CardHub, American Express and Visa ranked highest for extended warranty policies.

Trip cancellation. If you have to a cancel a nonrefundable trip due to illness or weather, your credit card may offer trip cancellation protection. Some cards offer to cover up to $10,000 of flight, hotel and transportation fees. Just read the fine print carefully. Almost every card has a different policy, and, again, some cards charge annual fees. The Citi Double Cash Card has no annual fee and offers up to $1,500 worth of trip protection. The United MileagePlus Club card offers a whopping $10,000 worth of trip cancellation protection but comes with a hefty $450 annual fee.

Rental insurance. Just about every major credit card issuer offers some form of car rental insurance, which is a great alternative to purchasing supplemental insurance from a car rental agency. Rental policies may change depending on which state you’re in, so definitely call up your credit issuer to ask before you assume you are covered. Nerdwallet closely tracks cards with the best rental insurance offers and ranks Visa, MasterCard, American Express and Discover at the top of the list.

Culled from yahoo finance

The biggest pensions shake-up in a century: how will it affect you?-By Katie Morley and Dan Hyde

Last year’s reforms were hailed as a radical overhaul of retirement savings, but even more dramatic changes lie ahead

The Chancellor is planning to save billions for the Treasury by changing tax relief on pensions, according to the former pensions minister Photo: Getty Images

Savers will be asked to give up billions of pounds of tax relief they have received on their retirement funds under a tax grab being prepared by the Government, the former minister for pensions predicts today.

Steve Webb, a prominent member of the coalition government until May, warns that people who have been “saving for decades” are the ultimate target of an inquiry announced two weeks ago.

The Treasury is considering re-writing the tax rules on pensions that currently ensure savers are charged only when they withdraw the cash after age 55.

In future, pensions could become almost identical to Isas – taxed up front rather than on withdrawal – albeit with a bonus to reward people for setting aside money for the long-term.

Commentators claim this would be one of the most far-reaching changes to pensions since the concept of mass retirement saving was first introduced by David Lloyd George, with the support of Winston Churchill, in the “people’s budget” of 1909.

Based on half a decade working closely with George Osborne, Mr Webb also believes the proposals under consideration could see millions of savers given the promise of no further taxation if they give up a chunk of their fund to the Exchequer in the first place.
Although George Osborne has said he will approach the issue with an “open mind”, Mr Webb says his former colleague is eyeing a “once-in-a-generation” chance to collect tax on money that would otherwise have been locked out of the Treasury’s reach for decades.
Writing for Your Money (page 10), Mr Webb says: “Instead of giving tax relief throughout a working life and only gradually receiving tax through the decades of retirement, a “pensions Isa” would allow the Chancellor to tax income as soon as it is earned, though foregoing taxation in decades to come.”
“The biggest prize of all would be to unlock the untaxed wealth in the pension funds of those who have been saving for decades.
“My suspicion is that a reform affecting the millions already saving into a pension is what the Chancellor is really interested in.”
Everyone from large pension companies to consumer groups, think tanks and readers of The Daily Telegraph can submit views to the 13-week consultation on tax relief reforms that began earlier this month.
Mr Webb, himself the architect of pioneering policies such as the new “flat-rate” state pension, said the Chancellor will be waiting to see “who can come up with the best idea for bringing forward the most revenue with the lowest political cost”.
Here, Your Money breaks down why, how and for whom pensions taxation could change – and the potential implications of Mr Webb’s insight on the Chancellor’s predilections...

Why would the Government change the system?

George Osborne says he wants to change the system to encourage people to save more, but this is only part of the story. The primary reason is to save money because the pension system as it currently stands is too expensive (see Personal Account, right). By removing tax relief on pension contributions and allowing people to withdraw their money tax-free instead he could release billions to spend elsewhere today – such as paying off Britain’s burgeoning debt mountain.

How would this potential new system work?

According to Steve Webb, instead of savers pocketing tax relief throughout their working life and then only gradually paying tax back over the decades of retirement, pensions could be treated more like Isas.
This would allow the Chancellor to tax all income as soon as it is earned.
He says there would have to be some remaining incentive to encourage pension saving, but a potentially on a smaller scale.
This could be a flat rate of tax relief at, say, 33pc, replacing the current system in which basic rate taxpayers get 20pc relief and higher rate taxpayers get 40pc. Effectively, it would be the Government giving £1 for every £2 saved.
Under the current system you pay £120 into a pension and get £30 paid in by the Government, making a gross contribution of £150. As a higher rate tax payer, you get a further £50 offset against your tax bill via your tax return.
Say instead relief was at 33pc, a £120 contribution would be topped up to £180 – with nothing further for higher-rate taxpayers.
It is also thought that the current 25pc tax-free lump sum, available when savers take their pension, may be removed or reduced.

What about the pension money we’ve already saved?

This is the potential bombshell. Mr Webb thinks the Chancellor would want to encourage savers to hand back tax relief they’ve already enjoyed, in return for the promise of future tax breaks when they spend their savings.
This could involve savers having to make highly complex calculations as to whether they would be better or worse off. Equally importantly, savers would also need to trust successive governments to uphold the future tax promises.

How to get the most out of tax relief now (while it lasts)

If you’re in a work pension scheme, you need to find out how much you can contribute per year and consider investing up to the maximum. Most schemes let you contribute a maximum of 10pc to 15pc of your annual salary. If you’ve reached the maximum and have further money to invest you can utilise the rest of your annual allowance (£40,000 for this year, plus any unused allowance for the past three years) in a private pension. If you don’t have one you can set up a self invested personal pension (Sipp) cheaply via an online broker. However if you do this and you’re a higher rate taxpayer, you’ll have to claim back the extra tax relief through a self assessment form. Here’s how it works:
1. You make a payment into your pension pot. For ease of calculation, say you pay in £800.
2. Your pension firm boosts your contribution by the 20pc basic rate tax relief.
Most big providers add the basic rate of tax relief instantly, so in this case your pension pot gets £1,000 (in other words, your contribution is boosted by 25pc).
3. Your pension provider then goes to HMRC and claims that money back on your behalf.
4. If you are a higher-rate taxpayer, you claim the extra 20pc back through your self-assessment tax return. There is a box on the form where you can declare the gross pension contribution (in the above example, £1,000).
But when would you do it? If you are now getting down to filling in your tax return for the year ending April 2015 (which you can send in at any time between then and the deadline on January 31, 2016) you will be including any contributions made during that period.
Equally, if you make a payment into a pension between now and April 5, 2016, you would include it on the return for this tax year, where the deadline would be January 31, 2017.
Culled from Telegraph

Is 10% a Good (or a Bad) Tip? That Depends on Where You Live-Sam Becker

Source: Thinkstock

Tipping is a very contentious issue. Most of us grew up with it being a part of many daily transactions — adding a percentage on to a bill at a restaurant, throwing a buck at a door man or valet, or simply dropping our extra change into a bucket at a cash register. A lot of people don’t think about it, as tipping has become more or less ingrained into American culture, and the American economy.
But things are changing. With all of the economic distress over the past decade, and new and sometimes wide-ranging government regulations coming into play, tipping is becoming more talked about than at any time in the recent past. That, of course, begs the question as to who and what you should tip, and where.
Tipping, traditionally, was a rare occurrence. It was meant only as a very special nod of appreciation to someone providing a service, who clearly went above and beyond their role. Or, to ensure that service would be fast and deliberate. Since then, it’s become a ubiquitous part of the service industry. It’s become expected, although largely unspoken, that patrons basically pay a portion of the staff’s wages — an ingenious way for employers to offload labor costs. And that’s really where we’re starting to see a problem.
Employers have actually managed to have tipping codified into law, in some ways. Just look at minimum wage laws. Many states only require “tipped positions” be paid a fraction of the actual minimum wage. That’s because patrons are expected to pitch in for the rest. While it’s true that employers do have to make up the difference if an employee’s tips don’t add up to at least the minimum wage on an hourly basis, it’s rather common knowledge among service professionals that employers don’t stand for that; if you are going to cost them more in labor expenses, they’ll probably find a way to replace you.
What we’re left with is an entire industry that is dependent on tips — and though some waiters and bartenders might make a nice living from it, the premise as a whole doesn’t sit well with a lot of people.
These days, tipping provides an incentive for service staff to be on top of their game. But as the economy shifts, and new minimum wage laws come into play, people’s views are changing on how, and when, they should tip.
What’s really made the issue so contentious lately is that minimum wages are on the rise, and in some cities, are as high as $15 per hour. From a patron’s standpoint, if an employee is making a livable wage, then they are, and should be, free from having to add on a gratuity. After all, since employers are now paying higher wages, they’ve probably incorporated that additional expense into the price of their product or service.
And there are a lot of people who are no longer tipping. There’s nothing wrong with that in most cases, unless you decide to go about it the wrong way. If you feel that service was subpar, or that the staff at whatever business you are patronizing is being paid fairly, then don’t tip. The overwhelming majority of service professionals can take it in stride and forget about it, while still providing you an adequate amount of attention.
So we come to the center of the shrubbery maze: when you’re in different parts of the country, how much, if anything, should you be throwing down in gratuity? It depends. For those states in which service people are completely dependent on tips, it’s customary to tip between 20-25%. Yes, it’s a lot, but remember: your server didn’t write a $2.13 minimum wage into law. Employers lobbied for it.
Here is a snapshot of the U.S., and the required minimum wage per hour for ‘tipped positions’.

Data from U.S. Dept. of Labor//Graphic by Sam Becker for The Cheat Sheet

Now, in that list of states that require employers only pay $2.13 per hour, a higher tip is definitely expected. In those ‘in-between’ states, where wages range from the federal $2.13 minimum for tipped employees to the actual federal minimum wage of $7.25, a relatively high tip is also common — somewhere in the 10-20% range.
For the few states that are higher than that (the green states in the map above), it’s still customary to tip between 10-20%, though many people are starting to leave lower percentages, and not tip at all.
So, for a quick recap, the amount you should tip depends on what state or city you’re in. And yes, you’re always free to leave nothing, especially if the service was bad.
For those that do hate the tipping custom, there are some changes on the horizon. Seattle, San Francisco, and Los Angeles have all opted to raise their minimum wages to $15 per hour, in an attempt to ensure a living wage for their lowest earners. In response, some restaurants in those cities have opted to go ahead and ban tipping outright, seeing as how their staff is now making a relatively fair wage. That’s good for patrons, and it’s also good for the employers, who are taking the pressure off of their customers.
But by and large, it’s still up to you to determine how much you want to tip, and how deserving the staff is of your gratuity. Even if you’re in Seattle or Los Angeles, it’ll probably reflect poorly on you if you don’t tip your server after a very expensive meal at a five-star restaurant. But again, it’s up to your discretion.
There are different rules in different cultures and countries, and tipping has also made its way into other elements of the economy as well, so be wary. You may feel pressured to tip on take-out orders, when you buy a cup of coffee, or even when you get a haircut. Nobody expects you to tip 20% on a cup of black coffee at Starbucks, mind you, but it’s still something that has become rather ubiquitous.
Until tipping finally goes extinct in the U.S. (which could take generations, if it ever happens) most of us will play along and eat the cost. The important thing to remember is that it’s not the service staff who are to blame, so unless they’re doing a horrible job, save your complaints for the employers and lawmakers.

Culled from wallstreetcheatsheet

Millennials have a ton of stock. They just don't know it-By Suzanne Woolley

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When it comes to millennials and stocks, study after study paints the 20-ish to 30-ish set as risk-averse cash hoarders. Yet many younger workers probably have most of their retirement savings in stocks. 

As more employers automatically enroll new employees in 401(k) plans, they are increasingly putting them in target-date funds, also called lifestyle funds. Some of these funds start out with equity weightings as high as 90 percent.

A big weighting in stocks when you're young makes sense, because you have decades to ride out market cycles. But younger workers can’t count on a defined benefit pension plan, are more likely to lose their jobs than are older workers, and tend to use 401(k)s as rainy day funds to tap between jobs. That makes holding a lot in equities riskier for them than for previous generations.

How do millennials feel about that risk? FinaMetrica, an Australian psychometrics firm, ran the data for us on the 25,000 millennials in the U.S., Australia, New Zealand, and the United Kingdom who have taken its risk assessment. It found that an 80 percent or 90 percent weighting in equities is way above the risk tolerance of millennials.

In the U.S. , the average risk tolerance score for people born from 1980 to 2000 was 52.3 out of 100, FinaMetrica found, meaning they are comfortable having 43 percent to 63 percent of their portfolios in equities .  The “too much risk” zone in which “clients will definitely be discomfited and will likely panic in a downturn,” is 72 percent, Paul Resnick, the firm's co-founder, says. FinaMetrica's data show that an equity component of 90 percent is going to be too risky emotionally for 96.1 percent of millennials. That breaks down into marginally risky for 10.4 percent of them and way too risky for 85.7 percent of them.

A market drop that gets a millennial to pay attention to his or her 401(k) could lead to panic selling, possibly at a market bottom.  And if they lose their jobs amid the market rout—not an uncommon event—it could sour them further on stocks and, financial planner Michael Kitces says, “set them up for a personal crisis whenever the first bear market happens,” a crisis most of them have never seen. "Just because a lot of young people have the time horizon and capacity to take the risk [of high equity exposure] doesn't mean they want to, need to, should, or desire to," Kitces says.

Retirement plans should hold off on putting young workers in target-date funds with high equity allocations until these employees have amassed a “starter portfolio” equivalent to about six months’ income, wrote Rob Arnott, founder of investment firm Research Affiliates, in a 2014 article. A third of the portfolio could be in large-cap, well-known stocks, a third in bonds, and a third in diversified inflation hedges to damp volatility. 

Still, target-date funds could well prove stickier than other equity investments. There was evidence of that among older investors in the 2008 crash. If millennials pay any attention to the pitches for these products as long-term, diversified, one-stop shop "solutions" for retirement savings, they could prove more resilient in the face of risk than many expect.

Culled from Bloomberg

Employees missing out on $24B in employer matches- Jennifer Barrett |

Jennifer Barrett reports on a new study which measures how many employees are missing out on employer match money. 

 

Over the past decade, employers have increased efforts to enroll workers in retirement savings plans. And they've paid off.
Participation rates are at all-time highs with nearly 8 in 10 employees taking advantage of defined contribution plans like 401(k)s when they have access to them, according to estimates by Aon Hewitt.
Persuading workers to max out their savings in those plans, though, has been tougher.
By 2013, the "vast majority [of employers] offered some type of employer-matching contribution" to encourage workers to save more, according to a recent Aon Hewitt analysis of nearly 150 plans with 3.5 million eligible employees. But even when employers offer matches, employees don't always take advantage of them.
A new report released Tuesday by the independent investment advisory firm Financial Engines found that 1 in 4 employees is missing out on receiving the full company match by not saving enough—leaving an average of $1,336 on the table each year. Or an estimated $24 billion altogether.
"The match is one of the best deals employer plans offer," said Greg Stein, director of financial technology at Financial Engines, which examined the savings records of 4.4 million retirement plan participants at 553 companies. "It's an instant return on the retirement plan and demonstrates why it's so important to communicate the benefit of participating fully, and how much money is at stake."

Jamie Grill | Getty Images

As retirement plan researchers can tell you, unclaimed employer match money is not a new phenomenon. But what's interesting is that one of the very mechanisms for encouraging participation in retirement savings plans may have inadvertently exacerbated the problem.
By the end of 2013, about 65 percent of companies reported having auto-enrollment programs, in which employees are automatically defaulted into a plan with an option to opt out, a feature that became increasingly widespread after passage of the Pension Protection Act in 2006, which provided safeguards for employers that adopted it. (Before the law passed, an estimated 20 percent of employers had retirement plans with auto enrollment; the number has more than tripled since.)
But the default contribution rate for most of those plans remains at 3 percent, the amount many companies adopted when they first added the feature—well below the 10 to 15 percent of annual income that advisors often recommend savers set aside for retirement.
"That's what was written into the code as the example, and suddenly everyone else was doing it. It was the herd mentality," said Rob Austin, director of retirement research at Aon Hewitt. Its latest report found more than 6 in 10 companies had a default contribution rate of 3 percent or less in 2013.
Meanwhile, most employers with matches offer 50 to 100 percent of as much as 6 percent of an employee's salary. "The problem that we have is often people are defaulted into rates that don't take full advantage of the match," said Robyn Credico, senior consultant at Towers Watson, a global professional services firm. "And we know most people don't do much once they default. So automatically they're missing out."


In the last few years, employers have begun taking steps to combat the inertia effect.
Fifty-seven percent of plans that automatically enroll participants also default employees into automatic escalation programs that increase employee contributions annually. That's up from 45 percent of plans in 2011, according to Aon Hewitt.
The plans typically increase contributions by 1 percentage point a year until they reach a cap—and Austin said the cut-off level has been climbing in recent years in an effort to boost employee savings rates. About one-third of companies that offer auto-escalation programs now increase contributions up to 10 percent of employees' salaries, and some have caps that are even higher.
"The theory is that if you turn people off when they hit 6 percent, it sends the message that that's enough to save, and it probably isn't for most people," said Austin, adding that some auto-increase programs now continue until employees hit the maximum they can contribute per year. That's $18,000 this year for a 401(k).
Some companies have also begun raising the default contribution rates in their auto-enrollment programs—sometimes to 10 or even 15 percent, said Austin, "though that's more the exception than the norm."
There's one simple reason for that. "Cost is a big barrier for companies," he said.

Companies use matching plans to attract new hires in a competitive marketplace, but they're keenly aware that employees often stick with the default option. If their contributions are automatically increased each year, the amount employers will be paying out in matches will surely grow as well.
More common, said Austin, are efforts to encourage employees to save more through education and increasingly personalized outreach. Some employers offer small group and one-on-one meetings to outline the benefits of participation. Others go further, even texting nonparticipants with a link to a streamlined sign-up page.


"Instead of sending the same postcards to everyone," said Austin, "they say, let's hone in on nonparticipants or those who aren't meeting the match to let them know they're leaving money on the table."
And it can be substantial. The Financial Engines researchers found employees gave up anywhere from a few hundred dollars to more than $20,000 in employer match money a year. If you factor in the additional money that could be earned each year had it been invested instead, the loss is even greater.
"It's a lot of money," said Stein. "It's enough to make a significant difference to people's quality of life in retirement."

Culled from CNBC

The world's Top 10 wealthiest couples-Amanda Weindel

Lacy O'Toole | CNBC. The world's wealthiest couple has a combined net worth of $85.7 billion, according to Wealth-X

 

According to data compiled by Wealth-X, Microsoft co-founder Bill Gates and his wife, Melinda, are the world's wealthiest couple, with a combined net worth of $85.7 billion.
Amancio Ortega Gaona, the co-founder of Spanish retail firm Inditex, and his second wife, Flora Perez, earned the No. 2 slot with a combined net worth of $70.7 billion. The Oracle of Omaha, Warren Buffett, and his wife, Astrid Menks, came in at No. 3. Their net worth totaled $65 billion, according to the report.

Bill and Melinda Gates joined with Buffett in 2010 to form the Giving Pledge, a campaign to encourage the world's wealthiest people to commit most of their riches to philanthropy. Since it was originated, more than 100 pledges have been made.

The world's 10 wealthiest couples

Rank	Couple	Net worth
1	Bill & Melinda Gates	$85.7 billion
2	Amancio Ortega Gaona & Flora Perez	$70.7 billion
3	Warren Buffett & Astrid Menks	$65.0 billion
4	David & Julia Koch	$47.5 billion
5	Charles & Elizabeth Koch	$47.4 billion
6	Wang Jianlin & Lin Ning	$40.7 billion
7	Jeff & Mackenzie Bezos	$39.8 billion
8	Bernard Arnault & Helene Mercier	$38.7 billion
9	Mark Zuckerberg and Priscilla Chan	$38.5 billion
10	James and Lynne Walton	$36.2 billion

Wealth-X

Culled from CNBC

Are workplaces ready for older workers?- Kelley Holland

It's the latest thing in retirement: not retiring. More workers are planning to continue in the workforce past age 65, and some plan to never retire.
Nearly 60 percent of 50-plus workers plan to continue working past age 65, and 82 percent of workers age 60 and over have the same goal, according to a white paper published in June by the Transamerica Center for Retirement Studies.
Workers' plans could represent a healthy trend in light of research suggesting that mental stimulation helps delay cognitive decline. But old workers will only be able to follow through on those plans if employers are in fact ramping up en masse to accommodate them in later life.



That is not the case, at least not yet. Just 4 percent of the employers responding to a 2014 survey by the Society for Human Resource Management reported that they have a formal strategy for recruiting or retaining older workers. And research by JP Morgan found that while 67 percent of all current workers expect to retire after age 65, in reality, just 23 percent do.
Labor force participation by older workers is increasing, but "workers' expectations may exceed today's labor force realities," said Catherine Collinson, president of the Transamerica center.
The problem is particularly acute for women, since they tend to accumulate less in retirement savings and they have longer life expectancies. A new report from Sen. Patty Murray, D-Wash., found that the average income of women over age 65 is just 55 percent of men in the same age bracket.


"Women face systemic barriers that hinder their ability to access a secure retirement, barriers that begin long before they reach the retirement age," wrote Sen. Murray to her colleagues on the Senate Committee on Health, Education, Labor and Pensions.

That's not to say that all employers have their head in the sand. In fact, one major industry, health care, often dominates lists of the best employers for older workers. (In addition, women make up about 80 percent of the health-care workforce.)
Ann Doshi, a nurse educator at Morristown Medical Center in New Jersey, is still going full steam at "65-plus," as she puts it, or just shy of 66. Doshi has been working in operating rooms for 40 years, first as a scrub technician, then as an operating room nurse, and now as an educator for other operating room nurses.
"To be in this kind of position, they prefer someone with experience," she said. "It's one thing to use theory, and another to have the hands-on experience." But Doshi thinks the same may not hold true in other professions. "I think you find that in many fields, when people reach certain ages, the mentality is 'maybe we can get someone in here who is fresh,' " she said.


Baby boomers represent about 40 percent of the Atlantic Health workforce, said Lesley Meyer, corporate manager of human resources.

Carol Indri, 50, an operating room nurse at Morristown and one of Doshi's trainees, also finds the hospital and its parent company, Atlantic Health, very open to workers in the AARP years. But she said she knows people who have not been nearly so lucky. She pointed to a friend of hers whose husband left her when she was in her early 40s, who has been "barely able to keep a job" and is now "on the welfare side of life."

Employers may soon be forced to make more provisions for older workers. People over age 65 accounted for 12.6 percent of the U.S. population in 1990, but their share is expected to increase to 16.8 percent by 2020 and 20.9 percent by 2050, according to Census Bureau calculations.

For now, though, older workers would do well to have a plan B for their so-called golden years.

Culled from CNBC

Families face tough decisions as cost of elder care soars-By Matthew Craft

The median cost of a US nursing home tops $91,000 a year, forcing families to reconsider care

.

View photo

In this July 1, 2015 photo, Roslyn Duffy poses for a photo holding two photos of her late mother, Evelyn Nappa, at her home in Seattle. Duffy had to scramble to find a home willing to take Medicaid payments after her mother was evicted from a Seattle assisted-living facility. The stress and the change of surroundings strained her mother's health, Duffy said, and six weeks after moving, she was dead. (AP Photo/Ted S. Warren)

NEW YORK (AP) -- Doris Ranzman had followed the expert advice, planning ahead in case she wound up unable to care for herself one day. But when a nursing-home bill tops $14,000 a month, the best-laid plans get tossed aside.
Even with insurance and her Social Security check, Ranzman still had to come up with around $4,000 every month to cover her care in the Amsterdam Nursing Home in Manhattan. "An awful situation," said her daughter, Sharon Goldblum.
Like others faced with the stunning cost of elderly care in the U.S., Goldblum did the math and realized that her mother could easily outlive her savings. So she pulled her out of the home.
For the two-thirds of Americans over 65 who are expected to need some long-term care, the costs are increasingly beyond reach. The cost of staying in a nursing home has climbed at twice the rate of overall inflation over the last five years, according to the insurer Genworth Financial. One year in a private room now runs a median $91,000 a year, while one year of visits from home-health aides runs $45,760.
Goldblum estimates that she and her mother spent at least $300,000 over the last two years for care that insurance didn't cover.
"If you have any money, you're going to use all of that money," Goldblum said. "Just watch how fast it goes."
How do people manage the widening gap between their savings and the high cost of caring for the elderly? Medicare doesn't cover long-term stays, so a large swath of elderly people wind up on the government's health insurance program for the poor, Medicaid. For those solidly in the middle class, however, the answer isn't so simple. They have too much money to apply for Medicaid but not enough to cover the typical three years of care.
Some 60 percent of Americans nearing retirement — those between the ages of 55 and 64 — have retirement accounts, according to the Employee Benefit Research Institute. The median balance is $104,000.
Combined with other savings and income, that amount might provide some retirees with all they need for decades. But everything changes when, for instance, an aging father struggling with dementia requires more help than his wife and children can manage. Plans that looked solid on paper are no match for their bills.
"Within the first year most people are tapped out," said Joe Caldwell, director of long-term services at the National Council on Aging. "Middle-class families just aren't prepared for these costs."
Many who can afford it buy insurance to help pay for long-term care years in advance, when insurers are less likely to reject them. But even those with insurance, like Ranzman, come up short. Forced to improvise, they sell the house and lean on family. They move in with their adult children, or arrange for their children to move in with them.
Some can save money by switching to different facilities. On average, a shared room in a nursing home runs nearly $11,000 a year less than a private room, and a room in an adult-family home runs cheaper still.
Still, there's not a lot of room for creativity, said Liz Taylor, a self-employed geriatric care manager in Lopez Island, Washington. "The amount of care you need dictates the price," she said, "and there aren't that many ways around it."
Hiring an aide to spend the day with an elderly parent living at home is often the cheapest option, with aides paid $20 an hour in some parts of the country. But hiring them to work around the clock is often the most expensive, Taylor said. "Needing help to get out of bed to use the bathroom in the middle of the night means you need a nursing home," she said.
Greg Crist, a spokesman for the American Health Care Association, the country's largest trade group for nursing homes, said many of the same trends driving health care costs higher have pushed up nursing home bills. Americans are living longer though not always healthier, he said, so residents are more likely to arrive with chronic ailments that require more attention. Facilities have also expanded the range of services they offer.
"The cost is an element that may seem overwhelming at first," Crist said, "but when you consider all the services — 24 hours, seven-days-a-week care, with full room and board -- it sheds some light on it."
EVICTED
To Roslyn Duffy, it seemed that her mother, Evelyn Nappa, had everything she needed. After a stroke made it difficult to live alone, Nappa moved from Arizona to Seattle to be near her daughter and soon settled into The Stratford, an assisted-living facility, where she quickly made friends of fellow residents and the staff. "The care was great," Duffy said. "We loved that facility."
With the sale of the house in Arizona, Nappa's savings appeared sufficient to cover 10 years at The Stratford, enough to last until she reached 100. Duffy said that the home's directors told her not to worry about her mother running out of money and winding up on Medicaid, even though the government program pays just a portion of what many facilities charge. After all, many of the same homes that refuse to admit seniors on Medicaid will keep those who spend all their savings and wind up on the program. "'We will keep her here' — that's what they said," Duffy recalls. "But I didn't get that in writing."
A representative from the nursing home declined to comment.
As Nappa's dementia progressed, she needed more attention. That meant moving her from an independent unit that cost $3,000 a month, to a dementia unit that cost $6,000. Trips to the emergency room, hearing aids and other costs that Medicare didn't cover added up. Soon enough, the money that was supposed to last 10 years was gone in two.
Duffy enrolled her mother in Medicaid, confident that The Stratford's management would keep its promises.
Two months later, she received a letter saying her mother had 30 days to find a new home. Duffy protested, writing letters to the management and local newspapers, and succeeded in keeping her mother at the Stratford for two months until social workers helped line up an adult family home willing to take Medicaid payments.
But the stress and the change of surroundings strained her mother's health, Duffy said. Six weeks after moving, she was dead.
"She declined so quickly," Duffy said. "Being in familiar surroundings is hugely important for dementia patients. There's no doubt in my mind that the move hastened her death. It was devastating, just devastating."
NEW HOME
Ranzman's story has a happier ending. Her daughter pulled her out of the Amsterdam Nursing Home and rented a house in Smithtown, Long Island, with a patio and a backyard full of azaleas and trees. It was Ranzman's own space. She had round-the-clock aides, a large window and plenty of sunlight. Her daughter, Goldblum, noticed that Ranzman's memory improved quickly. Her mother seemed happier and more alert.
"It was less than half the cost of a nursing home and a million times nicer," Goldblum said. "She showed such improvement."

Goldblum paid $36,000 a year for the house and her mother's long-term care insurance paid the home-health aides. The move saved around $250,000 a year in expenses.

What's more important to Goldblum is that her mother seemed content when she died in April at age 86, lying in bed and surrounded by family. "It was a wonderful ending," she said.

Culled from AP