Melissa Preddy

Veteran financial writer Melissa Preddy served as a business writer, editor and columnist for The Detroit News from 1995 to 2008, is a Michigan-based freelance journalist. She now works as a writer and editor for a medical research unit of the University of Michigan Medical School. Follow her daily posts. | E-mail: Melissa Preddy

From horse racing to Mother’s Day: Seasonal financial angles to tackle

By Melissa Preddy on May 03, 2013 in Beats, Economy, Featured, Melissa Preddy, Personal finance, Retail | Lifestyle, Small | Private | Non-profit, Story ideas

May offers a variety of timely financial story ideas, including a slated increase of spending on Mother's Day.

May is one of those months bursting with seasonal topics that make for interesting and informative local business stories, especially small business and entrepreneur profiles.

Taking it from the top:

Cinco de Mayo. Time is tight but if you are feeling energetic today, it’s an increasingly celebrated festival not only in Hispanic neighborhoods but at bars, restaurants, grocers and the like; here’s an AMNewYork article that notes an uptick in demand around this type of year for various foodstuffs and says “even Irish pubs celebrate Cinco de Mayo nowadays.”

Horse racing. If you missed tying a seasonal feature to Saturday’s Kentucky Derby, no need to fret. The 139th “Run for the Roses” is just the kickoff of horse racing’s Triple Crown season, which also includes the Preakness and Belmont stakes, so you have through the Belmont in early June to latch onto the horse-racing peg for stories about local tracks, trainers, stable operations. Don’t forget about “racinos,” where traditional horse-racing tracks have added slot machines to keep players occupied between horse wagering opportunities.

And if racing isn’t big in your region, chances are there is some other facet of the equine industry, from breeding and riding lessons or shows to controversial businesses such as those that operate carriage horses in tourist areas. All are worth looking at from a regulatory (and complaint/disciplinary action) standpoint, or as a source of business profiles. Here’s an economic-impact report from the American Horse Council, a trade group, which says that horses have a $39 billion economic impact in the United States and that the industry employs more than 4 million people. (Look for ancillary industries too; custom makers of tack, feed supplies, veterinary care and pharmacology, trailering, etc. — there might be some interesting cottage or family businesses among them.)

Mother’s Day. A perennial favorite; Mother’s Day is You can go the retail route; here’s the National Retail Federation’s forecast which says consumers will spend $168 on mom this year, and that iPads are going to be a popular gift. The 11 percent uptick in planned spending is likely to be good news for jewelers, florists and restaurants; the latter two experience some of their biggest sales days of the year around Mother’s Day, which falls May 12 this year.

If you want to take an edgier angle, consider something about workplace maternity leave policies, which have been spotlighted this year following the gyrations at Yahoo!, which recently announced a 16-week paid leave policy for new mothers. You could do a round-up of local maternity benefits at large employers and among small businesses, too. Or, take a look at the assisted reproduction industry. You could recap the process, and financial costs, for a couple going through fertility treatment, for example. (Caveat: Demand to see real documents, including canceled checks, bank statements, clinic bills, insurance statements.) Here’s a link to the Society for Assisted Reproductive Technology – perhaps it can point you to member physicians and tech companies in your region. Here’s a New York Times portal featuring a variety of older stories on related topics that may help you focus. And here’s a Forbes column that highlights some of the controversial aspects of in vitro fertilization, including expense and excess embryos.

Proms and graduation parties. Big, big business these days that a variety of service industries have come to depend upon. And here’s a new Visa study that claims parents plan to boost prom spending by a whopping 33 percent this year, pushing the average cost of prom attendance to more than $1,000. Here’s an ABC News article that recounts many of the expenses, from make-up to tux rental; you can follow that breadcrumb trail to local purveyors. Look for DJs and VJs, professional prom promoters/organizers and even professional prom consultants; this website advises wedding planners to “expand into the lucrative prom consulting business.”

Then there’s graduation. Parties, gifts and accoutrements like invitations all have their own industries, while others are latching on as well: Check out this Wall Street Journal piece about high-end “senior portraiture” that’s applying more glamor than ever to student pix and becoming a specialty of photographers. (I like the article’s point about the irony that kids awash in digital images of themselves still want posed studio shots.)

I interviewed some car dealers a few months ago and they all mentioned that college and high-school graduation were peak periods for gift-giving, some had been pressed into service to help parents surprise children with cars showing up at parties and the like. That could be a fun story tied to any number of personal finance angles, from the ever-growing length of car loans to the scarcity of good used cars. (Pre-owned vehicles are given as gifts, too.) And here’s an MSN story about Chrysler’s creation of the Dodge Dart gift registry, which lets people exhort friends and family to contribute to the cost of their ride in a sort of crowd-funding move. Any graduates trying it out in your area?

Don’t forget about trends in lower-grade graduations, too. Are people catering shindigs for elementary and middle-school move-ups these days?

‘Furlough loans’ and more effects from the sequester

By Melissa Preddy on May 02, 2013 in Beats, Economy, Featured, Investing | Banking, Melissa Preddy, Personal finance, Story ideas

Find the lingering local impact of the sequester on your coverage area's businesses and consumers.

It’s probably time for another look at the effects of the federal budget sequester on businesses and consumers. Here’s an eye-opening concept that is ripe for localizing: Banks and credit unions are offering “furlough loans” as relief to workers forced to take unpaid leave from government agencies. According to that Credit Union Times report, one institution is offering up to $5,000 at zero percent for 30 days, tied to existing members’ checking accounts.

Hmm. Other terms aren’t quite that generous. Here’s a great local take on the topic by the Detroit Free Press financial columnist Susan Tompor; she reports about local and national programs that charge up to 5 percent with repayment terms as long as 36 months. (Note the potential sources in the infobox with the column, as well.)

In addition to highlighting programs available to local workers (keep in mind state governments do money-saving furloughs, too), you could tap a financial planner’s expertise to extrapolate the long-term cost of these loans, and to give financial tips for building an emergency fund, reining in expenses and other coping strategies. Here’s an ongoing series from the Daily Press in Hampton Roads, Va. about how to handle furlough finances; clearly that region is more affected than most so that approach makes sense. But virtually everywhere you’ll have an appreciative audience for some level of advice.

I wasn’t able to locate a state-by-state accounting of expected or ongoing sequester-related furloughs, but this site, Government Executive, has a “Furlough Watch” page that is reasonably current and outlines expectations at a wide variety of agencies; it’s good background and a ready-reference guide of entities to check with and whose local workers you can seek for consumer voices.

As long as your checking with financial institutions, ask about payment delinquencies; are they seeing any effect of these layoffs in collections of mortgage, auto loan and charge card payments? What about loan demand? On the whole, it’s rising, as American Banker recently reported, citing Federal Reserve data — but in areas that rely heavily on federal employment, or at financial institutions that cater to that worker segment, are statistics bucking the national trend?

And how are worker furloughs rippling out to small business and subcontractors? This CNBC report is a good template for a local look.

And here’s sort of a kooky angle: Can planned furloughs actually help some businesses? Here’s a Bloomberg story on workers stocking up on groceries in advance of short-term layoffs. Golf courses offering discounted fees to furloughed workers. And here’s another entry from Government Executive, detailing other bargains for furloughed employees, from resume-writing services to car parts. The IRS just announced which days some 89,000 of its workers will take unpaid leave; if I operated a theme park, movie theater or other entertainment venue I’d be eyeing those summer days as a potential uptick in business, and marketing accordingly. Are any businesses in your area jumping on this promotional bandwagon?

Quicktips: From upper-arm tucks to up-in-arms truckers

Use this sampling of story ideas to kick off your week.

Catchy story ideas are piling up so rapidly this week I’m afraid some good news pegs will get lost on the cutting-room floor, so without further ado here’s a new addition of Quicktips:

Baring biceps: The American Society of Plastic Surgeons is just out with its annual report on in-demand cosmetic procedures. The 2012 Plastic Surgery Procedural Statistics update relates demand for a variety of plastic surgeries and “minimally invasive” procedures like Botox injections, in 2012 vs. 2011 terms as well as the change from 2000 to 2012. The news being touted this year is that upper-arm lifts are in greater demand, perhaps prompted by Mrs. Obama’s buff biceps. Incidence of the procedure is up more than 4,400 percent since 2000. why not localize the survey by asking area plastic surgery practices about how your community stacks up in demand for these procedures? How do plastic surgeons in general fare? And are they facing more competition from other practitioners? I’ve seen examples lately of dermatologists, eye doctors and even gynecologists offering Juvederm, Botox, Latisse and other beauty enhancers to patients — even holding “ladies’ nights” or “spa events” to woo patients in.

Another way to use the plastic surgery angle would be to highlight the difference between cost-comparisons for such elective procedures not covered by insurance, compared the difficulty in finding out how much covered procedures really cost. In other words, it’s pretty easy to learn the cash fee for a facelift from a variety of practitioners, but just try to find out how much a colonoscopy or other common surgery costs. Remember this New York Times piece from February, highlighting a study in which 100 hospitals were surveyed for their price on hip replacements? Only about half could answer, and of those that did, prices ranged from $11,100 to $125,798. With worries about health care premiums growing as time nears for full implementation of the Affordable Care Act, stories that highlight the helplessness of consumers to make informed choices are timely and useful.

Charge ‘em if you’ve got ‘em: Marlboro parent Altria Group Inc., in a nod to waning demand for its tobacco smokes, will begin producing an electronic cigarette this year, with details to come in June, Bloomberg reports. Forbes says the e-cig market is doubling every year, though the products are not regulated by the FDA or other agencies. Some appear to be sold via a multi-level marketing arrangement, others hang on pegs at gas stations. Consider a look at e-cigarette sales and demand at area retailers, and check in with restaurants, bars, casinos, airports and other venues about whether they permit these “vapers,” as the electronic smokers are known, to indulge on the premises. The smoke emitted is mostly water vapor, and users of the cigarettes can choose the strength of their nicotine cartridge — or use a no-nicotine version if they merely want to go through the motions. E-cigs can be charged in wall outlets, though many are coming with chargers that plug into computer USB ports, too. Who knew? This is a good workplace story, too — do any employers permit puffing at one’s desk or workstation? If not, why not? What about health systems that won’t hire smokers; does that include electronic users?

Truck-stop troubles: Sometimes I listen to trucker satellite radio in my car, and lately there’s been a lot of brouhaha about a truck-stop scandal involving the Pilot and Flying J brands; the company – headed by the family of the governor of Tennessee – was raided by the FBI recently amid charges the chain withheld volume rebates from its customer trucking firms, much to the rage of truck operators. Check out the coverage by USA Today, for background. If these chains operate in your area, there’s an obvious local angle in talking with patrons and area trucking firms for their take.

Even if they don’t, the truck stop industry and others ancillary to the nationwide movement of freight are often overlooked. You could check out the latest in truck-stop amenities, look into area laws about the idling of big rigs (there’s tension between drivers who like to run the head and A/C while at rest vs. officials concerned about air pollution) or the cost of diesel fuel and its affect on freight operators. Here’s a Truckers Report portal about truck stops, with everything from the fascinating history of these roadside pit stops to directories, links to trade groups and other helpful background info.

Tragedies that spawn merchandise and consumer goods

By Melissa Preddy on Apr 29, 2013 in Beats, Economy, Featured, Media | Advertising, Melissa Preddy, Retail | Lifestyle, Story ideas

We’ve seen this before, but it always raises eyebrows when it happens: companies and entrepreneurs rushing to market with merchandise inspired by tragic events.

Remember the t-shirts that cropped up after the fatal Costa Concordia cruise-ship grounding, and the Japanese tsunami relief gifts? Of course, the Sept. 11, 2001 terrorist attacks inspired items ranging from commemorative coins to flag pins to wine and even knives, as this Huffington Post article points out.

And now, two weeks after the Boston marathon bombings, related merchandise is up for sale. Most eye-catching is this “Boston Strong” Yankee Candle. The company started taking orders for the $27.99 item last week and says net proceeds from sales of the new scent – described as “a heartwarming blend of cinnamon, baking spices, and a hint of freshly poured tea” – will be donated to The One Fund Boston to help bombing victims. The candle company’s site also co-markets scents with names like Let Freedom Ring, Stars and Stripes and God Bless America on the Boston Strong candle page.

Elsewhere, reports say Boston-related sports merchandise and other “Beantown” gear are in hot demand following the terrorist attack, and that items ranging from marathon medals to copies of Boston newspapers to decals and stickers flashed up onto eBay right after the explosions occurred.

Obviously, you can localize this story by checking with your area’s sporting goods stores, eBay sellers and the like to see if they’ve seen any uptick in sales spawned by consumers’ desire to honor or show solidarity with Boston residents, first responders and so on. (Find eBay sellers by searching on terms like “Boston” and refining the search by ZIP code.) And if any of your locale’s big corporations have donated to the relief fund, or send goods in kind, check in to see if they have any plans for tribute merchandise or packaging as the Yankee Candle company has done. You can also look for cottage industries on Zazzle, CafePress and similar outlets to see who’s creating T-shirts and other goods with Boston themes.

I’d also see it as a good peg for a marketing story in general. How does it benefit a company to be associated with a negative event? People who aren’t aware that Yankee Candle is donating Boston Strong proceeds might take umbrage, for example. What are the pros and cons from a branding, image or marketing standpoint of joining in mass mourning or tributes to tragedies? And which tragedies tend to spawn consumer goods vs. others? I did not, for example, find T-shirts and other goods related to the West, Texas fertilizer plant explosion, though it was the more deadly of the two events that week. Nor did the Newtown school shooting generate candle scents and other items. It would be interesting – especially in light up upcoming patriotic holidays like Memorial Day and the Fourth of July – to talk with marketing experts about the thresholds of good taste, etc. that lead to corporate decision-making in times of tragedy.

Finance Friday: More resources for writing about kids and money

By Melissa Preddy on Apr 26, 2013 in Beats, Featured, Investing | Banking, Melissa Preddy, Personal finance, Retail | Lifestyle, Small | Private | Non-profit, Story ideas

Use these ideas to tackle the topic of children and finance.

In our final Finance Friday, an April round-up of tips and resources for personal finance angles in honor of National Financial Literacy Month, I wanted to offer some additional ideas for writing about children and financial skills. Many money missteps by adults might be averted if kids and teens had more exposure to personal finance lessons. (Note: Don’t miss last week’s post, which offered an initial round of resources for stories on kids and financial literacy.)

If you want to structure locally-sourced personal finance primers for kids, try seeking out a panel of experts, including perhaps a credit-union budget counselor, a Certified Financial Planner, a representative of a credit-counseling agency (find one certified by the National Foundation for Credit Counseling) and perhaps an academic from a consumer sciences program or your state’s cooperative extension service. They likely have prepared materials on basics like how savings, checking and charge accounts work, to mortgage basics, to the fundamentals of savings and investing. I think the key concept in any primer (for kids or adults) is compound interest — because knowing how it works can inform young people about the ramifications of decisions that range from saving a portion of high-school earnings to buying a car to the consequences of taking out student loans.

I once, for example, wrote a personal finance story in which a CFP analyzed the finances of a 21-year-old who had reluctantly chosen a full-ride scholarship at a regional school over the chance to attend (and pay for) a more prestigious college. The young graduate perked up considerably when the adviser told him that this decision alone likely would make a $600,000-plus difference to his age-60 nest egg, due to the scholarship. Get your experts to run similar real-life or hypothetical scenarios that reflect the decisions teens and young adults will be making in the near future.

For other basics, the Jumpstart Coalition is always a good source of links and resources; check out its National Standards in K-12 Personal Finance Education as a benchmark of what kids should be learning at various age ranges.

And even if you don’t cover personal finance directly, you may be able to find some relationship to kids and money on your beat. If you cover financial services, for example, you might seek out banks and credit unions that offer special youth accounts. Wells Fargo, for example, offers a “hands-on banking” course and free savings accounts for young children, while USAA offers similar banking products. You might compare those that are available in your area to point out fees and other caveats.

If you cover small business, consider a feature on some angle related to Junior Achievement, which last year published a Teens and Personal Finance report, or other service programs that teach young people business and money-management skills. Various entrepreneurs have come up with products, such as those offered via the Future Investors Club of America – and here’s one in Kansas, the MoneySmart Financial Management Camp for middle schoolers, that is sponsored by the state and a credit-union trade group.

Here’s a company that has developed the audaciously named “Camp Millionaire” for kids and appears to license or market it through credit unions and the like. And sites like Three Jars tout the concept of divvying allowances and the like into savings, spending and sharing (charitable funds) and offer online trackers so children can keep track of the cash parents are holding for them. Are any entrepreneurs near you targeting the youth personal finance market with seminars, camps, books, websites or products?

Feds zoom in on payday lending: How will subprime borrowers fare?

By Melissa Preddy on Apr 25, 2013 in Beats, Featured, Health care, Investing | Banking, Melissa Preddy, Personal finance, Story ideas

Use these tips to take a closer look at a variety of lending products serving the subprime market.

Wednesday’s report on payday loans by the Consumer Financial Protection Bureau is a good prompt for a look at a variety of lending products that serve the subprime market, those consumers with poor credit. Another news peg: California lawmakers just last week defeated proposed reining-in of payday loans, which the American Banker online publication says is a $3 billion industry in that state alone.

The 45-page (PDF) CFPB report says that these short-term, high-interest loans generate a cycle of debt that consumers find difficult to escape, with fees and interest piling on faster than the cash-strapped borrower can accumulate funds to repay them. And here’s their infographic on how people are using payday loans.

According to the New York Times’ Dealbook blog, the CFPB plans this week to target big banks involvement in the short-term loan market, requiring ‘cooling-off” periods between loans to the same consumer and other changes. These banks tend to market the stop-gap lending as “checking account advances” to existing customers; you might check on similar products, and their fees, terms and conditions, at local and regional banks even if they aren’t immediately being addressed by the CFPB. A graphic or primer on how these advances work, and how fees can escalate, might be instructive for readers.

(And this is a story where you might do an actual shout-out to readers, asking about their experiences with checking account advances — it might produce some interesting case studies. As usual, though, demand to see their actual bank statements for the time frame in question rather than accepting anecdotal evidence.)

According to the Community Financial Services Association of America, the industry’s trade group, some 20,600 outlets make more than $38 billion in loans in the United States each year, and nearly 20 percent of U.S. households utilize the service. That’s a wide reach and even more reason to present your audience with information about new industry scrutiny and tools for deciding whether or not to use such loans. Talk with local consumer advocates, credit union budget counselors and others about possible alternatives to payday loans. Are any micro-lending sites or faith-based solutions cropping up in your area? Here, for example, is the website of Grace Period, a non-profit payday-loan alternative in Pittsburgh that apparently was started by church members. (Note, I haven’t vetted Grace Period but am offering it as an example of what to look for and investigate in your community.)

The Center for Responsible Lending, a non-profit, non-partisan organization, offers pithy commentary and research about the payday lending industry, as well as other subprime products.

And for more context about subprime lending, here’s a recent release from the credit-reporting agency Equifax; it says fewer people overall are in the subprime category (credit score of 620 or lower) though there is variance based on regional economies and unemployment levels. The release gives figures for 25 metro areas; if yours isn’t on there you might contact Equifax or another CRA for local statistics.

Here’s a Loans.org infographic highlighting states where payday lending is effectively illegal; if your state isn’t on here, you might want to contact your state lawmakers’ banking and finance committees to find out about any pending legislation.

Pawn shops are another area you can investigate; I’ve recently been receiving press releases from online pawn shops, including one called Pawngo that touts itself as a discreet alternative for “elite” borrowers. Keep your eyes peeled for other subprime products cropping up, as lenders begin to loosen the purse strings — here’s a release from an outfit that will offer, through doctors’ offices and other providers, medical financing for subprime patients. No word on the interest rates and fees, which the company, WholeHealth Products, says will offer “piece of mind” to medical consumers. Why not call some area medical clinics and doctors to see what sort of financing products they’re being asked to tout these days?

Beyond the Texas explosion: Workplace safety angles to explore

By Melissa Preddy on Apr 24, 2013 in Agriculture, Beats, Energy | Utilities | Mining, Featured, Insurance, Melissa Preddy, Story ideas, Technology

A screenshot from KXAN's coverage of the Texas fertilizer plant explosion.

With vivid images of the Texas fertilizer plant explosion still making headlines, you may be thinking about a workplace safety angle to the companies you cover. It’s a natural story to localize, as audiences ponder the relative perils they face on the job. From inspection records to prevalence of workers compensation claims to fatalities to insurance costs for employers, there are a plethora of approaches you can take to a story that touches most households. Another news peg is International Workers Memorial Day, slated for April 28, a day set aside around the globe to acknowledge those who die or are injured on the job. The same day is designated by the United Nations as World Day for Safety and Health at Work – astonishingly, the International Labor Organization, which co-sponsors the commemoration, says that some 321,000 people die on the job each year.

Investigative pieces about inspection rates and regulation are always good reads. I am not an expert in the use of databases but the folks at the IRE (Investigative Reporters and Editors Inc.) are; if you have access to their members-0nly areas, here’s a link to tipsheets on workplace safety investigations by journalists. And here’s a Reuters piece, for example, about the reporting requirements for factories that handle material like that at the Texas plant; you can see how the multi-layered regulations still failed to catch the dangerous levels of chemicals stored there.

This Triangle Business Journal production is interesting; they used state labor department statistics to rank North Carolina counties by incidence of workplace fatalities, you could also present the information by employer or by industry, and include a bit more detail about the situations that led to on-the-job deaths. The federal Bureau of Labor Statistics is a wealth of information about workplace safety, including its annual census of occupational fatalities, which for 2011 reported that fishing, logging, transportation and solid-waste jobs were among the most dangerous in the United States. Don’t overlook the metropolitan and statistical area reports on the BLS site. And of course, the U.S. Department of Labor’s workplace safety portal is another trove of information, from statistics to links to state programs.

Insurance companies may be sources of information about trends in workplace safety issues — obviously those who underwrite workers compensation policies have a vested interest, but you might also poke around with property insurers. And check with state insurance regulators about programs such as this one in Delaware, that offer discounted policy premiums to companies that participate in safety programs.

And do such programs pressure workers to not adequately report workplace injuries, for fear of blotting the employer’s record? I just had a friend relate that her son refused to report a minor but emergency-room-worthy mishap he suffered at his retail job, for fear of being the guy who ruined the perfect safety record. Is this sort of cultural issue within companies skewing official safety statistics? You could talk with Also talk with unions, guilds and trade organizations about this angle and other safety concerns they may be raising on behalf of their members. Here, for example, is a study from the Center for Construction Research and Training about the incidence of accident under-reporting, and here’s an October 2012 report on why workers fear making a compensation claim. This May 2012 report cites a federal Government Accountability Office report that finds similar concerns about workplace safety incentive programs.

Has this stigma grown in an era of waning jobs, and how does it translate to other injury-prone industries like health care, manufacturing and so on? Don’t forget to tap into labor relations experts at area colleges and universities, as well as schools of public health.

Who gains, loses when state sales tax collection is enforced?

By Melissa Preddy on Apr 23, 2013 in Featured, Investigation, Melissa Preddy, Personal finance, Retail | Lifestyle, Small | Private | Non-profit

The Senate was expected to vote Monday on the Marketplace Fairness Act, or MFA, a bill that would require online sellers to collect state and local sales taxes just like their brick-and-mortar counterparts do.

Most states don't require online-only retailers to collect tax.

For the past decade or so, traditional merchants have opined that e-commerce sites like Amazon.com have a pricing advantage because (at least when Internet sales first got rolling) they don’t have to charge sales tax to consumers, effectively reducing the cost of a purchase by the equivalent of the consumer’s state sales tax rate. That’s because in most cases, a merchant without a physical presence inside state lines has not traditionally been required to relay sales taxes to that state.

As mail-order companies like Amazon grew and added warehouses and distribution centers, or affiliates, around the country, they established what’s known as “nexus” (a presence) in multiple states and their liability for collecting taxes grew state-by-state. (That growing liability is one reason why Amazon, which once protested a universal rule, is not today seen as a foe of the Marketplace Fairness Act.) But land-based retailers still decry the price disadvantage, and states desperate for revenue (the National Conference of State Legislatures estimates that in 2008, states lost out on $18 billion in uncollected sales tax) still are pushing the bill.

The Senate activity is a good peg for a fresh look at a variety of sales-tax related stories, including the Marketplace Fairness Act. It’s supported by a variety of trade groups, as per this list from the advocacy group in favor of the legislation. They’re not all retailers, so check out the listing to find hits on your beat, from veterinary medical associations (who presumably resent those online pet-meds sellers) to college textbook sellers to food-service and grocery organizations. It would be interesting to find out the basis for some of these groups’ objections — are online grocery sales and catalogue wine-and-cheese sales really enough to threaten land-based supermarkets, for example? Why would the World Floor Covering Association have a position on this bill? You might turn up some intriguing facets of e-commerce with a little poking around.

Amazon Inc. has said it supports a national online sales tax. Photo: Scottish Government

Meanwhile, opponents include, obviously, online sellers. Your best bet for a local angle might be individuals and small businesses that sell on Etsy, eBay, iOffer and other sites that make it easy for those with cottage industries to do business via the Web. EBay, for example, has attempted to mobilize its sellers to fight the Marketplace Fairness Act, according to recent reports. However, the MFA would exempt companies that do less than $1 million a year in business, so people selling handicrafts and the occasional collectible probably have nothing to worry about. Still, you can search for some local sellers and ask them to detail the effect they anticipate, if any, on their prices, profit margins, business practices and accounting costs if they are forced to collect sales tax.

The other notion that springs to mind is a look at state-granted sales tax exemptions. What sorts of organizations are exempt from collecting sales tax on the goods they sell — and why? And what products in your state are exempt? Here’s a list from Colorado that says sales taxes are waived on a variety of goods from agricultural pesticides to bingo equipment. it might be interesting to see which special interests in your state are getting similar breaks.

Here’s a Washington Post primer on the Marketplace Fairness Act. The National Conference of State Legislatures’ page on the act also includes informative links. And here’s a help page from the Small Business Administration with additional practical information.

Finance Friday: Literacy and the common paycheck

By Melissa Preddy on Apr 12, 2013 in Basics, Featured, Melissa Preddy, Story ideas

April being National Financial Literacy Month, we’ve instituted Finance Friday, and between now and the end of the month we’ll share resources for producing basic personal finance stories that will help your audience with the fundamentals of their household money matters.

Finance Friday Melissa Preddy Today, let’s take a look at matters related to that most elementary money task, earning. Pretty much everyone, or at least every household, has income and needs to use it wisely in consumption.

By the way, since “literacy” is the aim of the many events this month by non-profits, financial institutions and other companies, why not take a how-to approach to some of the stories? You could use photo slide shows, graphics or even video to illustrate how certain forms should be filled out, for example, or to illustrate budgeting concepts.

Take that common financial instrument, the paycheck. With this being tax-filing season, many people probably are second-guessing their withholdings, either because they want a smaller refund and more cash flow throughout the year, or because they want to boost withholding and get a larger refund after the first of the year. (The latter, of course, isn’t the most financially savvy idea, though that sort of forced savings is better than nothing for people who otherwise can’t discipline themselves to set money aside. In an upcoming Finance Friday on saving and investing, we’ll look at ways to automate the process.)

So a graphic or story illustrating how to complete the W-4 form, which tells the employer how much to keep pack each pay period. Here’s the Internal Revenue Service primer on withholding; note the sections on lifestyle changes that can help alert people to amending their W-4s. Also, with many people working more than one part-time job these days, the section on how to manage that may be of interest.

Another topic to address in the same story is the absence of withholding; people working for cash, or as contractors being paid via 1099 forms, or even those receiving unemployment insurance checks may have received a rude awakening over the past few weeks when calculating what’s due on those forms of income.

Some will owe self-employment taxes (FICA payments for Social Security and Medicare contributions; they’ll owe the full amount because no employer exists to pick up the other half.) Here’s a nice, conversational FinanceGeek.com explanation of how to calculate tax liability and how to set aside money to pay it when filing season rolls round. You might also enlist a CPA to provide a more sophisticated view of the variables, and even consider a review of the best tax software for individuals and small businesses, with an eye toward features that help with year-round tax tasks.

Other ways to parse the paycheck include a look at deductions for employer-sponsored benefits like health care, life insurance, even parking. Here’s a good primer on “Understanding your pay stub” from TIAA-CREF; it may seem simplistic to teach people to decipher these forms but in my experience you’ll have a lot of grateful readers who were embarrassed to ask.