Bankruptcy Alternatives – Know Your Options

Before you file bankruptcy it may be wise to look into the bankruptcy alternatives available to you. Filing for bankruptcy will be with you for up to 10 years and may not be as easy as you wish it to be.

Contact your creditors first and explain why you are having trouble making your payments. Instead of filing bankruptcy, you may be surprised how many creditors will work with you. They are willing to cooperate, because they make more money keeping you as a long-term customer. They know bankruptcy alternatives; will mean more profits in the end.

Another bankruptcy alternative is a debt consolidation loan. A bank or financial service can combine all your debts into one easy loan payment. This consolidation loan bankruptcy alternative will pay off all your debts. Take time to shop for the best interest rate because lenders are very competitive for your business. It’s a good idea to stop all further purchases using this bankruptcy alternative. Remember the reason you’re considering bankruptcy in the first place.

You can also try a informal proposal as bankruptcy alternatives. In many cases you can work with your creditors to set up on easy monthly payment plan. This can sometimes be done without affecting your credit rating. The informal proposal bankruptcy alternatives are very similar to debt consolidation loans, but you do not borrow money to pay off your creditors. You simply negotiate a win-win situation as a bankruptcy alternative. You do not have to tell creditors you are considering bankruptcy. They already know it may be in their best interest knowing bankruptcy has spun out of control in the United States. These creditors know bankruptcy alternatives are more profitable to their bottom line.

Consider a debt workout is when an attorney contacts your creditors and make arrangements, which would require you to make some payments to them. Usually the payment will be less than if the account is settled in full with this bankruptcy alternative. Sometimes the arrangements will call for payment in full, but over a longer period of time than originally stated in the loan agreement.

There are many bankruptcy alternatives available to you. Take the time to look into all your alternatives before filling bankruptcy. 10 years can be a long time when you may have dreams of owning a new home or car. It’s wise to look into bankruptcy alternatives that you can do to help your credit situation.

Foreclosures fall for 10th straight month

NEW YORK (CNNMoney) — Foreclosure filings dropped once again in July, hitting their lowest level since November 2007, as processing delays and foreclosure prevention measures enabled a larger number of delinquent borrowers to remain in their homes.

Filings were down 4% compared to June and were 35% lower than July 2010, marking the tenth straight month of year-over-year declines, according to RealtyTrac, a leading online marketer of foreclosed properties.

RealtyTrac reported that 212,764 U.S. homes received some kind of foreclosure filing — notice of default, notice of auction sale or completed foreclosure — during the month. Bank repossessions totaled 67,829, down 33.6% from the peak month of September, 2010 — when banks took back 102,134 homes, and off 27% from 12 months earlier.

The steep foreclosure drop, according to RealtyTrac CEO James Saccacio, was triggered by a foreclosure processing slowdown that was sparked by the “robo-signing” controversy last fall. As a result of the scandal, in which the banks were accused of mishandling paperwork and failing to follow proper protocols, banks are being much more careful and many filings have been delayed.

“[T]he downward trend in foreclosure activity has now taken on a life of its own,” said Saccacio. “It appears that processing delays, combined with the smorgasbord of national and state-level foreclosure prevention efforts, may be allowing more distressed homeowners to stave off foreclosure.”

There were some small glimmers of hope in RealtyTrac’s report. One promising sign was the steep plunge in initial notices of default, which fell 39% year-over-year to fewer than 60,000.

The decline may indicate that fewer borrowers are falling behind on payments. Or, it could mean lenders are not filing those notices as promptly as they have in the past, according to Rick Sharga, a spokesman for RealtyTrac.

The company analyzed initial default notices in California and discovered that the average sum of missed payments has risen to $78,000 from $17,000 over the past four years. Sharga attributed the jump to delays in filing the initial papers.

Getting rid of repossessed homes

RealtyTrac’s release came a day after the Federal Housing Finance Agency (FHFA), the Treasury Department and the U.S. Department of Housing and Urban Development announced they were seeking suggestions on how to dispose of the 92,000 repossessed homes now owned by Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA).

FHFA, the agency that supervises Fannie/Freddie, and HUD, which oversees FHA loans, want to be able to reduce that inventory quickly and in a manner that helps stabilize communities that have been hard hit by foreclosures.

They’re seeking proposals from private enterprises, municipalities and non-profits that will result in bulk sales and result in their refurbishment and eventual resale or rental.

Hardest hit markets

Among the markets where these efforts may be most concentrated are those hardest hit by the foreclosure crisis. According to RealtyTrac’s report, Las Vegas continued to record the highest rate of foreclosures in the nation, with a filing for every 99 homes, but the gap between “Sin City” and other metro areas has shrunk.

Foreclosure filings in Stockton, Calif. jum ***a***ped 57% month-over-month, one for every 124 homes, the second highest rate.

Nevada continued to post the highest foreclosure rate of any state, one filing for every 115 homes. California, one in every 239 homes came in second place, and Arizona, one in every 273 homes, was third.

Has all of the market turmoil prompted you to move all of your retirement investments into cash? If so, we’d like to hear from you. If you’d like to share your story with CNNMoney, email blake.ellis@cnnmoney.com.  Foreclosures fall for 10th straight month

First Published: August 11, 2011: 5:27 AM ET

Struggling to climb out of the jobs hole

NEW YORK (CNNMoney) — Jobs may be coming back in many states … but don’t let it fool you.

Most of them still have a long way to go to recover from the recession, especially when factoring in the number of job seekers flocking to those places.

California, for instance, needs to create 1.8 million jobs to keep up with its population growth, according to figures crunched by the Economic Policy Institute for CNNMoney. That’s 11.2% more positions than there are today.

To come up with its jobs deficit figures, the institute calculated how many positions would have to be created in a state to get back to pre-recession levels, taking into account the growth in the working-age population.

The Golden State, despite its deep economic troubles, has seen this group expand by more than a million people since the recession began in December 2007. That places additional pressure on the state, where the unemployment rate is still 11.8%, the second highest in the nation.

Because of unemployed workers migrating to find work and the steep competition for jobs in those hot areas, even states that are doing well can still end up with a large “jobs deficit.”

Texas Governor Rick Perry is very proud of the state’s job creation efforts. His office set up a website titled “Texas Brags” to herald Texas’ “on ***a***going success and endless opportunity.”

Over the past two years, 40% of the new jobs in the U.S. were created in Texas, Perry told attendees at the National Conference of State Legislatures summit in San Antonio Wednesday. It’s one of only three states to have more jobs now than before the recession.

But Texas has also seen a population boom since 2007. The number of working age residents grew by 6.6%, nearly twice the national average.

This explosive growth means that Texas would need to create another 629,000 jobs, or 5.6% more positions, just to reach its pre-recession employment level, when factoring in this population growth, according to the institute.

Perry’s office acknowledges that the state has to create even more jobs since people are flocking to the state in search of work. It will continue to focus on luring companies with its business-friendly policies.

“It’s not surprising that companies, individuals and families are looking to Texas,” said Lucy Nashed, a governor’s spokeswoman. “It’s the epicenter of job growth in the U.S.”

Having a relatively low unemployment rate doesn’t mean that a state has no jobs deficit.

Take Utah, for example. The state’s unemployment rate is 7.4%, far below the nation’s. But it has the 8th largest jobs deficit, and needs to create 10.9% more jobs in order to climb out.

That’s because the Beehive State has seen its working age population grow by 6.7%. Much of that increase is due to children entering the labor force, though some is migration into the state, said Pamela Perlich, senior research economist, Bureau of Economic and Business Research at the University of Utah.

“When you have more labor force entrants, it gives you more of a challenge,” Perlich said.

Only one state in the nation is actually doing better than it was before the recession and has no jobs deficit, when factoring in population growth. Not surprisingly, it’s North Dakota, which at 3.2% has the lowest unemployment rate by far.

North Dakota has created 18,100 more jobs than it needs to keep up with its expanding labor force, which grew slightly faster than the U.S. population.

There are jobs to be had in many sectors, including energy, agriculture, health care and transportation, said Michael Ziesch, research analyst with Job Service North Dakota, the state’s employment services department. Right now, there are 14,580 open positions.

Ziesch knows that North Dakota’s secret as a jobs powerhouse is out. Nearly every day, he gets a call or an email from an out-of-state resident asking about the opportunities there.

“We are becoming a destination state,” he said. Struggling to climb out of the jobs hole

First Published: August 11, 2011: 6:14 AM ET

$2.8 trillion lost in market turmoil so far

Investors in the stock market saw $2.8 trillion in paper value disappear in recent weeks.

NEW YORK (CNNMoney) — If stock market gyrations make you queasy, you may not want to read on.

The Wilshire 5000 Total Market Index has lost $2.8 trillion in value since the stock market slide began on July 22. Some $600 billion of that went up in smoke on Wednesday, when the index and the Dow Jones Industrial Average both dropped about 520 points.

Not surprisingly, the stock market’s wild swings in recent weeks have sent investors and retirees scurrying to their financial advisors for some hand holding. The main message they’re hearing: Stay put.

“Try to take a step back from the day-to-day,” said Chris Philips, senior investment analyst with Vanguard. “Reacting to these ups and downs and sideways swings can actually do more harm than good for most investors.”

Call volume and web activity is up at the investment giant, but few people are making changes to their retirement portfolios. And in Vanguard’s brokerage division, clients have been buying more stocks than they’ve been selling in August, said Philips.

For some, the steep market drop is a chance to pick up stocks on the cheap. This is especially true if you have time to ride out the volatility.

“For people who are young, it’s a buying opportunity,” said Christine Benz, director of personal finance for Morningstar.

Those who need to cash out their portfolios within the next few years shouldn’t be that heavily invested in stocks anyway, Benz said. But if they are, they are likely getting slammed by the market plunges.

Those nearing or in retirement, as well as parents who need to pay college tuition soon, should have a mix of cash, bonds and equities. That asset allocation will allow them to better ride out the storm, Benz said.

Unfortunately, that investment advice isn’t always heeded. Vanguard found that investors over the age of 65 had an average of 49% of their retirement funds in equities in 2010, meaning some had allocated a much larger percentage of their portfolio to stocks than that.

So now would be a good time to check to make sure your investments are properly allocated to meet your goals and your risk tolerance. And if you aren’t sleeping at night, you may want to call your advisor.

“It’s hard to blame investors for feeling squeamish right now,” Benz said.

Has all of the market turmoil prompted you to move all of your retirement investments into cash? If so, we’d like to hear from you. If you’d like to share your story with CNNMoney, email blake.ellis@cnnmoney.com.  .8 trillion lost in market turmoil so far

Tax hikes on the rich would affect 3% of payers

NEW YORK (CNNMoney) — As the government looks for ways to climb out of its massive hole of debt, all eyes are on the rich.

President Obama and many of his fellow Democrats continue to call for higher taxes on the wealthy. And, according to results of a CNN/ORC International Poll released Wednesday, many Americans agree that it’s the only way the country can dig itself out of its current economic mess.

In the survey, 63% of the 1,008 people interviewed over the phone said they think the new bipartisan committee in charge of deficit reduction (required under the recent debt ceiling agreement) should raise taxes on higher-income Americans and businesses.

But just how many rich people are there? And are there enough of them for a tax increase to really make a dent in the United States’ trillions of dollars in debt?

President Obama has defined the nation’s wealthy as those who make $200,000 or more a year.

According to a recent report from the Internal Revenue Service, that leaves out about 97% of the tax-paying population.

The report, which provides a complete breakdown and analysis of returns for the 2009 tax year, found that only a mere 3% of tax returns were filed by people earning a gross adjusted income of $200,000 or more.

Americans earning $1 million or more were even more r ***a***are, comprising just 0.2% of total tax filers and accounting for a mere 236,883 of the 140 million tax returns received in 2009.

The wealthiest taxpayers — those earning $10 million or more in adjusted gross income — are even less prevalent. There were only 8,274 people belonging to that elite club, according the IRS.

Out of the nearly 4 million “rich” people making more than $200,000 a year, 1,470 didn’t pay any income tax whatsoever in 2009. But the people who did pay taxes earned a total of nearly $2 trillion in income — about 26% of total taxpayer income in 2009.

President Obama’s tax proposals — which many Republican’s call “job-killing” tax hikes — include getting rid of some corporate tax breaks enjoyed by oil and gas companies and corporate jet buyers, and restoring some Bush-era tax rates for high-income households. If the Bush tax cuts expire as planned in 2012, the top two income tax rates will revert to 39.6% and 36% from 35% and 33%, respectively.

Yet, even though these high-income earners are a minority, Obama says the proposed tax increases would boost revenue by $750 billion over a decade.

It’s not quite the multi-trillion figure the U.S. needs to pay off the deficit, but for many of those who responded to the CNN/ORC International poll it’s evidently a good enough start.

Has all of the market turmoil prompted you to move all of your retirement investments into cash? If so, we’d like to hear from you. If you’d like to share your story with CNNMoney, email blake.ellis@cnnmoney.com.  Tax hikes on the rich would affect 3% of payers

First Published: August 11, 2011: 5:45 AM ET

Mortgage rates keep falling: 30-year nears record

NEW YORK (CNNMoney) — Just when it seemed mortgage rates weren’t going to get any lower, they started testing new lows.

In the tumultuous days following Standard & Poor’s debt downgrades, rates on 30-year fixed mortgages fell to 4.32%, down from 4.39% last week and closed in on a record low of 4.17% set last November, according to Freddie Mac’s Primary Mortgage Market Survey.

Rates on 15-year fixed mortgages set a new record for the second week in a row, falling to 3.5%, down from 3.54% last week.

“It’s a crazy time,” said Doug Lebda, the CEO of online lending exchange LendingTree. “I’d say rates can’t get much lower, but I was saying that last week, too.”

The savings for borrowers who lock in rock-bottom rates over the length of a mortgage loan can be sizable. Take, for example, a borrower with a $200,000, 30-year loan. If their mortgage carries a 4.32% rate their monthly payment is just $992 and they make total interest payments of $157,153. However, if the rate on their 30-year fixed mortgage is 5% (ordinarily considered a low rate), they’d pay $1,074 a month and $29,357 more in interest over the 30-year period.

The low rates are sparking a rash of refinancing activity, according to the Mortgage Bankers Association. Last week, total mortgage borrowing, most of it refinancings, jumped nearly 22%. This week’s activity could be even higher, according to Greg McBride, chief economist for Bankrate.com.

“Rates have been below 5.5% for two years,” he said. “For most people who have refinanced or purchased since then, there’s little benefit to refinancing. But when rates drop below 4.5%, then it’s worth looking into.”

Rates could go even lower

Rates could drop even lower, according to Keith Gumbinger of HSH Associates, a provider of loan information.

“Low Treasury interest rates are still not being fully passed through to mortgage borrowers,” he said.

While mortgage rates do not move in lockstep with Treasury yields, they are closely correlated. The yield on the 10-year bond plunged to 2.24% Thursday from 2.56% at the end of last week.

The difference between the 30-year fixed mortgage rate and the 10-year Treasury yield is usually about 1.6 to 1.7 percentage points, so a bond rate of 2.24% should mean that mortgage rates should be at 3.84% to 3.94%.

“That argues that mortgage rates could go lower,” said Gumbinger. “Will the spread shrink again, though? That’s hard to say.”

One reason to question a further drop: S&P’s downgrade of the credit ratings of Fannie Mae and Freddie Mac. The downgrade could make borrowing more expensive for the two mortgage giants, which represent, along with FHA loans, close to 90% of mortgage lending these days. And those costs may get passed along to borrowers.

Another factor is that investors in mortgage securities backed by Fannie/Freddie may stop buying mortgages if the yields fall much further. The low rates would provide too puny a return.

Investors may also balk, according to Gumbinger, because the attractive rates give borrowers less incentive to prepay their mortgages. That means investors would get stuck with a low rate of return on their investment for a long time.

To compensate for that risk, according to Gumbinger, investors may demand greater yields and keep mortgage rates a little higher, even though they are already very low indeed.  Mortgage rates keep falling: 30-year nears record


How the self-employed can sell themselves online

By Anne Fisher, contributor

FORTUNE — Dear Annie: I recently left a 26-year corporate career to start my own consulting business, with my formerHow the self-employed can sell themselves online employer as my first client. A friend sent me your column about how to drum up new business, and I’m doing everything it suggests, but I also wonder how to make the most of the Internet in getting the word out about my services. So far, I’m just using LinkedIn, Facebook, Twitter, and a blog, but there must be more I could be doing online if I just knew where to start.

Also, how should I handle negative comments on my blog? When people make nasty remarks about points I’ve made, should I respond and get into a protracted argument, or just ignore them? – Flying Solo

Dear Solo: “A lot of people are singing the praises of online marketing and social media these days, but much of it is just a bunch of hype,” observes Patrick Schwerdtfeger, a serial entrepreneur who now heads the Entrepreneur and Small Business Academy, a nationwide network of small business owners based in Berkeley, Calif.

“A few businesses, however, really are using the Internet to explode their revenues practically overnight,” he adds.

How? Over the past seven years, Schwerdtfeger says he “tried everything” to build his own ventures’ credibility and exposure. “Some of my efforts succeeded. Most didn’t,” he admits.

To spare other solo fliers that trial-and-error approach, he has now collected his experiences in a book you might want to check out. Called Marketing Shortcuts for the Self-Employed: Leverage Resources, Establish Online Credibility, and Crush Your Competition, it’s organized into 80 short chapters, each with step-by-step instructions on a different brand-building move.

Happily, most of these tactics are cheap or free and take less time than you might expect. For example, Schwerdtfeger suggests, “Contribute 50 intelligent comments on relevant industry forums. Offering a quick piece of advice on a forum is easy and can be done in 10 minutes or less, so you could accumulate 50 of them in a couple of days.” Include your phone number or email address in your forum signature.

A more in-depth approach to positioning yourself as an expert in your field: Publish articles online, through low-cost services like iSnare and EzineArticles, and include a link back to your website or blog.

The articles needn’t be longer than 500 to 700 words, Schwerdtfeger says, but they should be packed with enough insight so that people who come across them through a search engine will want to hear more from you and will click on the link at the end.

Don’t worry that giving away information online will make prospective customers less inclined to pay for your services. Instead, it’s more likely to prime the pump. Schwerdtfeger tells of a dentist in Boston, for example, who gave away a 20-page e-book called “Healthy Mouth, Healthy Sex” online for free — and attracted so many visitors to her web site, and ultimately her office, that her annual revenues shot from $150,000 to over $1 million.

You mention that you’re already active on Facebook. If you haven’t already done so, Schwerdtfeger suggests you start announcing your blog posts on your Facebook page and using the “Facebook comments” plugin to encourage interaction with readers.

And what if, as you note, some of that interaction takes the form of snarky comments? Always respond to those, Schwerdtfeger recommends, but wait 24 hours first, to give yourself time to cool off. “Answer negative comments as best you can, but there will be some individuals you’ll never be able to appease,” he says.

“The important thing to remember is that your response is only 5% intended for the person who’s carping at you. The other 95% is intended for all the other people who will read the original comment followed by your response.” In other words, letting the exchange deteriorate into a virtual shouting match will just make you look hot-headed and unprofessional.

Schwerdtfeger has dealt with his share of hecklers, and he says he tries whenever possible to see potshots as a chance to learn something. A case in point: A “vicious” comment from someone about a podcast he recorded back in 2006 made him realize, once he thought it over calmly, that he wasn’t giving enough hard data to support his conclusions.

The criticism came after the podcast’s fourth installment and, says Schwerdtfeger, “If you listen to the whole series, you’ll notice that, starting in the fifth installment, my statements are backed up by a lot more supporting evidence. In other words, the later episodes are better than the first four.”

The moral of the story: “Ironically, sometimes negative comments are the best thing you can hope for. They tell you how to improve.”

Talkback: If you’re using the Internet as a marketing tool, what have you found to be effective and what is just hype? Leave a comment below.

Americans’ bleak outlook on jobs

NEW YORK (CNNMoney) — Americans are feeling pretty grim about jobs these days.

Only 29% of respondents to a poll released Friday believe more jobs will be available in their communities a year from now.

On top of that, a mere 44% said they believe that the same number of jobs will be available. And 26% take the even bleaker viewpoint that jobs will decline, according to the CNN/ORC poll.

As a point of comparison: The current frontline jobs forecast is slightly more pessimistic than Americans felt during the recession in 1991, and roughly the same as in the recession in 1982. (View the jobs picture in your state)

The CNN/ORC survey — conducted Aug. 5 to 7 — further found that seven in 10 respondents believe there are few jobs available in their area. Just 24% cited a normal number of jobs, and only 4% said many jobs are available.

It comes as no surprise that the labor market continues to struggle.

Thursday actually brought a ray of light, when the government reported that the number of first-time filers for unemployment benefits fell last week, dipping below 400,000 for the first time in four months.

But the unemployment rate remains stubbornly high at 9.1%, and signs abound that the economic recovery has hit a rough patch.

Last month, only 58.1% of Americans were employed for ages 16 and over. That’s a significant drop from before the recession, which began in December 2007 and lasted 18 months, and the lowest employment percentage since 1983.

A recent CNNMoney survey of economists found that the average chance of a new recession occurring to be about 25% — up from a 15% chance only three months ago.

In a gloomy assessment, the Federal Reserve on Tuesday said the recovery is “considerably slower” than expected, and announced it would keep interest rates low for another two years in a bid to prop up the economy.

Last Friday, Standard & Poor’s downgraded the United States’ long-held AAA credit rating. Global stock markets have been rocked since, experiencing dramatic swings both high and low. The Dow surged 423 points on Thursday, after a 520-point plunge the day before. Americans bleak outlook on jobs

First Published: August 12, 2011: 6:13 AM ET

Career makeover: Business on a bun

FORTUNE — For dessert, New England baseball fans are following up their franks with another type of dog — a Cool Dog. It’s an oblong roll of vanilla ice cream, served on a spongy-cake bun with all the fixings on top (hot fudge and sprinkles, not mustard and relish).

Dan Weil, 55, is CEO of Cool Foods LLC, the Boston-based purveyor of the Cool Dog. It’s a very long way from his career as a printing executive, where he headed U.S. operations for Riso, Inc., a Japanese-owned document solutions company.

A Brit who landed in Massachusetts, Weil became President and CEO at Riso in 1995 and grew it from $60 million in revenue to about $165 million. So why, in 2007, did he leave Riso?

In part it was because of a clash with management, but also because Weil longed for a turnaround. “I was looking for something that wasn’t growing and needed new life,” he says. “Instead, I came across a product that met none of those criteria, and found it intriguing.” That was the Cool Dog, which went out of business in 2005 because it expanded too quickly and, he believes, because the previous owners hadn’t perfected the cake and toppings.

When Weil sought advice from Essex Partners, a career management firm for senior executives, they pushed him to understand the risks of what he was about to do. “In this economic environment, starting a new company is no picnic, so we challenged him to refine his ideas,” recalls Ralph Roberto of Essex. “But this is a smart guy. He wasn’t running away from corporate life, but running towards it in a new way.”

It helped that Weil already had a background in food; he is a partial owner of L’espalier and Sel de la Terre, both French restaurants. Still, Cool Dog was risky. “I learned it’s tougher to restart a failed company than to start something from scratch,” he says.

Weil acquired the company in 2009 after ensuring that all stock and debt holders approved. He self-funded the deal with $500,000 that covered both the acquisition and the working capital, which mostly went toward purchasing equipment.

Rather than making supermarket shelves the top priority, Weil first focused on family-friendly properties like minor-league stadiums and small-town ice cream shops. He also worked hard to improve the taste of the cake, which was too dry. “It took me nine months,” he says, “but I came up with a cake that was light and moist.”

Since its 2009 re-launch, the little dog has shown some bite. It’s currently sold at five minor-league ballparks, as well as the Seekonk Speedway, Gillette Stadium, Stew Leonard’s, and 20 iParty store locations (it was also at Fenway Park until just recently, but was pushed out by a larger novelty). Weil expects 2011 revenues of about $500,000.

In the novelty ice cream business, there’s competition from every shape-on-a-stick out there. But Weil is undeterred: “The product ought to be everywhere, not just baseball games but birthdays, cookouts, bar mitzvahs.” Recently, Zagat named the treat one of its 10 unique hot dogs. By 2020, perhaps it’ll be on the menu at the Ritz.

Dan Weil’s cool tips for going solo:

Setbacks happen. Be prepared, and flexible. “One place told me they would run the product as soon as we had it ready. But ‘as soon as’ became four months after I had it ready.”

Family matters. “Get your whole family involved.” Weil’s 18-year-old daughter, he says, is his “toppings queen” and selects all toppings for the demo bag he takes on sales trips.

Persistence pays. Restarting a company takes patience. “At first, Sysco (SYY, Fortune 500) didn’t invite me to any of the big trade shows,” Weil says. “They were giving me a year to see if I would fail.” He didn’t. Similarly, it took six months to get into Stew Leonard’s. Career makeover: Business on a bun

Stashing cash in tampon boxes – and other sneaky spots

NEW YORK (CNNMoney) — As millions of Americans continue to lose their savings in the stock market, others are stashing their money where they know they won’t lose it.

The magazine of a gun. A box of tampons. The belly of a teddy bear.

Kerrie Hopkins gave her cash-hoarding aunt a “lettuce safe” — a faux head of lettuce with a secret compartment.

“No one would ever suspect it’s anything but a perennially ripe leafy vegetable,” Hopkins told CNNMoney.

But when Hopkins’ aunt saw an ad for the same lettuce safe in a magazine, she promptly threw it out, sure that her cover had been blown if her home was ever burglarized.

Another woman, Kate McDonald, is keeping her cash safe in an envelope. Each time she adds money to it, she folds the envelope over, then wraps it in aluminum foil and places it in the freezer. “It gives new meaning to ‘cold cash,’” she said.

With the stock market plunging more than 10% over the past month, many people are stocking up on tangible assets like cash and gold. But of course they need a safe place to put it.

Earlier this week, personal finance site Mint.com asked its users to name the most unusual places they’re hiding their cash.

Answers ranged from an iPhone case, the back of a boom box, a box of Animal Crackers to an unused purse. There was also a door frame and a box of waffles.

For sure, America’s cash hoarders have moved beyond the traditional safe haven — their mattresses.

One person is hiding money inside the wood panels of a bed frame, while someone else has cash hidden in rolled up nylons in the back of a drawer.

“We actually mounted a smoke detector on the kitchen ceiling that we removed all the guts from,” said another cash hoarder. “Perfect spot for a cash stash. It was easily accessible from the step stool we kept in there. I don’t think a burglar would be checking the smoke detectors.”

Others joked that the best place they have hidden their money is the stock market.

“It’s such a good hiding place that even I can’t find it anymore,” one quipped.

Ba-dum-cha!

Retirement plans and 401(k)s were also on the list. And some people said they wished they had any money to hide.

Ouch.

Of course, hiding cash around your house can be risky, said David Hefty, president of financial planning firm Hefty Wealth Partners. Not only do you risk getting it stolen, but you get no financial benefit — whereas a savings account could at least earn a little interest.

“This is the typical fight or flight mammal response,” Hefty said. “These people are very fearful and have a large distrust with our financial system right now.”

So they may need to work with someone to overcome their financial phobias and develop a real strategy for saving their money, he said.

“What we’re seeing here is people with strong short-term memories,” said Hefty. “Those who need to hide cash have what we call ‘financial paralysis.’ They are seeing signs of another recession.”  Stashing cash in tampon boxes - and other sneaky spots

First Published: August 12, 2011: 5:25 AM ET