Friday, March 26, 2010

How I Got Scammed!


By: Roshawn Watson

I shared that I got married last year, but one thing I never disclosed was how my wife and I got scammed by one of the vendors we hired for our reception. Obviously, this detracted somewhat from our celebration. I am not revisiting this painful experience out of any sadistic impulses but rather out my desire to inform you that you do have recourse if you have been scammed. You just have to be willing to fight.

How it Happened

It all started when my wife saw a local photographer's ad on Craigslist. We were initially suckered by the generous photo packages she offered and the professional photo samples she used to market her work on her website. After comparing her packages to three other photographers, we decided to hire her. During the meeting, she allowed us to customize the package to our needs, which was very important because we only needed to book her for our reception and engagement photo session since we had already hired two other photographers for our wedding ceremony. The photographer was very personable during our meeting, which made her relatable. The additional samples of "her work" she brought for our meeting were beautifully done. Although I had my reservations (i.e. I remember being unsatisfied with her website because I found a couple typographical errors), we went ahead and booked her and paid her a 55% down payment the day of our initial meeting. I am typically much more careful than this, but we were disarmed by this con woman. Unfortunately, we did not do due diligence, a mistake that we definitely lived to regret.

When you are hiring someone, it would serve you well to investigate his or her background. We took her word that the photo's she showed us were "her work." In actuality, we could have confirmed this with a few phone calls. Had we insisted on checking her referrals, we might have discovered the myriad of unsatisfied customers across several neighboring cities or the fact that there were inconsistencies in her story. For example, she claimed to have been in the business for years, yet why was there no record of her (at least under the name she gave us) or her business to be found. You see, we believe she was using an alias to hide her bad reputation in the industry. Likewise, she likely changed her business name to hide the fact that she had recently been investigated by the Attorney General and presently had a Better Business Bureau grade of F. A few phone calls and a google search of the business name before making a deposit would have saved us much heartache. Do not hesitate to inspect before you pay; in fact, this is your duty.

How I Found Out

Two days before our wedding reception, I had called the photographer. She had promised us that we would receive the engagement photos in time for our families and friends to see them. Everyone was asking to see our pictures, and the photographer had now been paid in full, yet we had no pictures. Additionally, I had the sneaking suspicion that she was deliberately avoiding our calls. I proved this because I decided to call her from a different line, and she answered and was completely shocked that it was me on the other line. She then proceeded to tell me a sob story and promised to get our pictures to me by that evening. Although she did give us access to the pictures that night, her behavior definitely aroused my suspicions, so I decided to investigate her company to my own dismay. It turned out that now, her new business name and her alias had finally been linked to her former business name, and she had been scamming couples all across the state. I was seeing red, but the Attorney General said that there was nothing that we could do until she actually violated the contract, which she technically had not done yet, so we were trapped in a contract with a con-artist. To say that we were disheartened would be a gross understatement.

Fortunately, she showed up and took pictures along with another photographer we hired at the last minute. She was late, introduced herself to my mother-in-law with her real name (before she "corrected" herself and gave her alias), and failed to really take the reins of the photo session, but she was there at least, which was a miracle in itself.

Maybe this would work out alright after all. I said to myself.

Unfortunately, this was merely wishful thinking. After the session, she practically dropped off the planet, except for the fact that the Internet began to be littered with more and more evidence of her deception, as more of her victims began to post their own painful stories. After the contractually agreed upon time for her to produced our photos had passed, I gave her a deadline and plenty of other opportunities for her to give us our photos, yet she was unwilling or unable to give us our package. She clearly had no intention of following through. We knew we had to get help.

How I Resolved It

One thing was sure: I would follow through with my promise; I would not let her off without justice. We called our lawyer to explain the situation and told her that I was interested in pursuing this issue both civilly and criminally. Our lawyer said that she thought that we had a great case and that our photographer was technically guilty of a felony. She also said that we should at the very least pursue unfair trade practices, which allows for the victim to recover up to three times the out of pocket expenses plus lawyer fees. We had to be careful because we didn't want to be guilty of extortion (i.e. if we threatened criminal action because of a civil dispute, we could be in trouble), but that's why we hired a lawyer to help us navigate the matter. Our lawyer said that we could get a judgement against her, which would show up on her credit report and stay on there ten years, and it could be reinstated for another ten years afterwards. Our detective found out our photographer's real name, dug around in her financial records, her family life, took pictures of her house, her vehicle, her family's vehicle, and investigated other ligation involving her. Suddenly, my wife and I didn't feel so powerless. After we had built our case, our lawyer sent her a demand letter citing a few ways which our photographer had violated the law and our desire that she resolve our claim expediently with a quick settlement. Unsurprisingly, now the photographer decides to call me (first time in months) to see if this is for real. I assure her that we are serious and that she needs to cooperate. That same week the photographer decides to settle the claim out of court. Today, my wife and I are whole thanks to God and our lawyer Carol.

Lesson Learned

Fortunately, my story had a happy ending, but I shudder to think about what would have happened if we didn't have the resources to vigorously encourage a settlement. The biggest lesson I learned from this experience is to not be so anxious to save money or mentally aloft during decision-making that you forego common sense. I also learned to listen to my gut more. From the beginning, I had a general sense of uneasiness regarding this hire. Obviously, we had to hire numerous people for the wedding, yet this was the only one that just didn't feel right. Sometimes, you intuitively know that something or someone is just too good to be true. Don't be afraid to walk away from some deals in order to satisfy your concerns with some hard facts. If we had done so, we wouldn't have gotten into this predicament in the first place. Lastly, don't be afraid to enlist the help of professionals. An objective third party with the right information can jump start your path to recovery, even if your emails and phone calls have been ignored previously.

Lastly, if you like this post, please subscribe (see upper right-hand corner), Mixx it, Propel it, Stumble it, and tag it on Delicious. Also, click here to get my eBook FREE.

Monday, March 22, 2010

Uncommon Money News (Vol. 88)


By: Roshawn Watson

In preparing to write my posts, I often come across noteworthy and sometimes bizarre financial and business news. Below are links to some of these sites. Enjoy!

Recently, I participated in the Carnival of Financial Planning #130 (hosted at the Smarter Wallet), the Carnival of Financial Planning #131 and #133 both hosted at The Skilled Investor . Lastly, I particiapated in the Carnival of Financial Planning #132 hosted at Good Financial Cents. The featured posts were: Thoughts On Escaping the Rat Race and Is Bigger Better? Scaling Down The American Dream. Thanks for including my posts in your carnivals. Please check out other posts on these sites.
To my readers: I am so honored by your support. Thank you for reading, subscribing, and for voting for articles from this site on social bookmarketing sites such as stumbleupon, reddit, delicious, digg, propeller, twitter, and yahoo buzz. Together, we are telling thousands of the importance of financial literacy. I absolutely could not do it without you. You are vital this this site, and I appreciate your! Thanks.

Business

Sony signs biggest deal ever album deal with Michael Jackson's Estate worth $250 million


How Much Is Facebook Worth? About $11 Billion

346 Most Admired companies

Continental Airlines To Tall People: Pay Up For Comfort

High-End Repo Men (Seizing Yachts, Jets) Are Thriving

Who Will Profit When Google Exits from China?

Workers Crushed by Toyota: 4700 Fired in Califorinia

Economy

Taxpayers Who Earn $300,000 a Year Don’t Feel Rich

Cities Where The Recession Is Easing

America's Richest Counties

The Richest States in America

Entertainment Money News

BeyoncĂ©’s Perfume Sells $3 Million–In Just One Month!

New Settlement Reach in Travis Barker Jet Crash


Dennis Hopper's Wife Won't Move Out!

Does Michael Jackson's Estate Owe Law firm $400k?

Jamie Jungers Wins $75,000 in Mistress Beauty Pageant

Alice in Wonderland Mammoth-sized opening

More Box Office News

Mel Gibson -- Malibu Retreat for Sale

Avatar Makes (More) History; Kevin Smith Not Too Fat to Open

Suge Knight -- Old School Tax Lien

Jennifer Aniston Strong, but Not Wimpy; Alice Most Powerful of All

Scarlett Johannson is selling her four-bedroom, gated Spanish villa in the Hollywood Hills

Britney Spears has just placed her home on the market again

Homes of the Billionaires

Offbeat Money News

Mexico's Slim Becomes World's Richest Person

How a Secretary Made and Gave Away $7 Million

Which Jobs Pay New Hires Best?

Defaulted Loans May Haunt Seniors


Specialist nurses paid higher salaries than family doctors

Image credit: KrishnAA7, HiltonFan

Wednesday, March 10, 2010

What's Your Financial Mindset


By: Roshawn Watson



A study by Nielson and research firm Inmar has illuminated the spending habits of the affluent. Did you know that affluent households tend to be heavier coupon users than those with lower incomes? This is one of the ways a person gains a high net worth in the first place: he knows how to spot a deal.

Humble Origins

There is an illusion that most millionaires are carefree, trust-fund babies who can barely comprehend the financial troubles of the average American family. However, the truth doesn't support this belief. Some 9 out of 10 millionaires are first-generation wealthy, and roughly 65% have been wealthy for less than 15 years according to a study by American Express Publishing. Since most millionaires come from middle-class households it's not difficult to understand why most millionaires know how to be frugal (i.e. coupon clippers). I have a friend who lives in a house over 10,000 square feet and has a Rolls Royce along with other nice cars, employs dozens and still talks about how he saves unfinished food for the next meal. He does not want to waste it. Of course, there are some millionaires who are out of touch, but that is certainly not the norm. With over two-thirds of millionaires having a net worth of $2.5 million or less, millionaires simply cannot afford to be oblivious for too long.

Good Fiscal Management

The habit of prudent fiscal management can have far-reaching implications. Consider that more than one-third of all millionaires obtain their wealth through businesses that they own. Business ownership increases your odds of joining the millionaire ranks by 5 fold. Unfortunately, there are risks as well, which is one reason why managing your money well is so critical. In the same way you look for deals for your household, you can search for good deals on products that you can later resale to consumers for a profit. The behavior of hunting for deals can also influence your investing. For example, if you are a value investor, you routinely are looking for stocks that trade for below their intrinsic value. In other words, you are looking for a deal. Most millionaires invest nearly 20% of their income. Consequently, in addition to living on less than they make, they are constantly building new wealth through investing. Additionally, the principle of good fiscal management would prevent one from over-spending on a home. Millionaires have more than six and one-half times the level of wealth of their non-millionaire neighbors, and these non-millionaire neighbors outnumber them three to one. Note that home equity represents just 10% of millionaires’ total assets according to research firm TNS. In other words, buying big or expensive homes before you can truly afford them is just so middle-class. Most millionaires do not own a Crib's-worthy house. Moreover, if you are a millionaire and do not understand money management, then your wealth may deteriorate. Consider former rap mogul Suge Knight who has a tax lien of $6,578,696.31 from 1996 but a present income of only $1200 per month.

Millionaires do not feel wealthy

You may be wondering why would millionaires be more cautious with their finances when their net worth dwarfs those of most American families. If you have this question, blame Hollywood.

Hollywood sells glamour and wealth to convince us of its relevance and power. Consider shows devoted to this, such as Selling New York on HGTV, Million Dollar Listings on Bravo, and the now defunct High Net Worth formerly on CNBC. These shows all promote the hypothesis that millionaires are so different from us. However, many pop culture depictions of millionaires are misleading because they ignore the fact that most millionaires are frugal. For instance, the media wouldn't show a millionaire clipping coupons because that doesn't typically make for good TV, yet many do. Selling this faux image of how the wealthy live is also about influence. If you buy those designer jeans because you saw them on some celebrity, then you may feel rich even though you are indeed getting poorer.

It is also easy to see how we were sold false premises about wealth. Wealth is relative to your context and environment, and when one is relatively broke (little to no net worth), it is easy to believe that a million is a fortune. When you are broke, it is...to you. It is unsurprising that 46% of millionaires don't feel rich according to Fidelity. When you are worth a million, you become acutely aware of its limitations. A million is not what it use to be. For example, one would need $2.9 million in today's dollars to have the same purchasing power as $1 million three decades ago. No wonder India Arie sung a million didn't make me happy.

Don't assume that materialism is a common thread amongst most of the wealthy, as there is much evidence showing that most millionaires are rather frugal. What's is important is knowing how to spot a deal. Just make sure that deals that you are looking for make you wealthy in addition to saving you a couple dollars. Happy shopping.

Lastly, if you like this post, please subscribe (see upper right-hand corner), Mixx it, Propel it, Stumble it, and tag it on Delicious. Also, click here to get my eBook FREE.

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Image Credit: Gnerk