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Two Money Stories

Good to start a Monday with a smile!

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Today’s blog includes two stories about money.

The first is a Virginia story from Goochland at Richmond.com and is about movie money. The picture of the evidence gives us a good clue about the facts.

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Movie prop money is circulating in Goochland County and the sheriff’s department is issuing a warning. “Be aware that someone may intentionally or mistakenly pass one of these bills”.

There is a clue on the money, “FOR MOTION PICTURE USE ONLY”. That’s a pretty good warning! I guess that’s also what is meant by “Funny Money“.

And our next court money story comes from the NBC Today Show. A man who was not happy about his date not paying attention to the movie Guardians of the Galaxy 2. She was texting. So, he sued her.

They didn’t have to go to trial. She settled for the price of the ticket. She paid him $17.31. Apparently tickets for 3D movies cost more.

The moral of these two stories? If you are going to text during a movie and get sued, then settle with movie money.

And finally, I am reminded of the sign that hung above the counter at the Harley-Davidson shop where I worked summers during law school. It read, “In God we trust. All others pay cash“.

Go with certainty!

 

and for pic o, even beats the taste of money!

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The Things of Robin Williams

This is a blog about money and estate planning. And so the adventure begins.

In trying to provide guidance, an IRS auditor supposedly reminded that, “The trick is to stop thinking of it as ‘your’ money”. I guess that’s one way to look at it. Of course Earl Wilson reminded us that, “if you think that no one cares if you’re alive, try missing a couple of car payments”. I learned a long time ago that the definition of a bank is a place who loans you money… when you don’t need it. (Bob Hope)

Jerry Seinfeld reminds us that dogs are happy despite having no money or things. “They are broke their entire lives but they get through. You know why they have no money? No pockets!”.

I remember one actor saying that the only reason that he made an American Express commercial… was to pay for his American Express bill.

And that leads me to Robin Williams who defined “Carpe per diem” as “Seize the check”.

The reminder that people are funny about money.     I end the blog with Robin Williams because his estate has his entire family in an uproar. It’s discussed in the NY Times article Robin Williams’s Widow and Children Tangle Over Estate.

Nearly six months after his death, his widow and the children from a previous marriage are in a legal fight over the division of the estate. According to the widow, she is entitled to the house and everything in the house. The kids say that she is entitled to everyday things in the house… not memorabilia that has value.

The wife is blocking access to the home. The kids basically are saying that she can keep her toothbrush, they want the Oscar statute. Well, in so many words that’s how it breaks out.

The kids claim it is effecting their ability to grieve the loss of their father. The wife says her domestic tranquility is being harmed.

Yep, people are funny about money. As Malcolm Forbes used to say about being rich, “I made my money the old-fashioned way. I was very nice to a wealthy relative right before he died”.

And for our pic o’ day, speaking of legal…

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The Greatest Showman on Success

The Investment site Motley Fool (Fool.com) recently wrote an article on P.T. Barnum, who was known as the greatest showman on earth. We still credit him for his amazing circus shows.

By the middle of the 19th century, he had become the second known millionaire in the United States. He wrote a short paper on “The Art of Money Getting” which had ideas that are still useful. Below, I have pasted portions from the Motley Fool article. In reading this, it also caused me to research Tom Thumb, who had quite a story of challenge and success.

1. Spend less than you earn. Barnum writes that the key to wealth is quite simple: “it consists simply in spending less than we earn.” Despite the simplicity of this maxim, he notes, “more cases of failure arise from mistakes on this point than almost any other.”

Barnum tells the story of a woman who cut her expenses by refusing to burn candles in the evening. She may have saved five or ten dollars by doing so, but she lost out on the knowledge she would have gained by reading during those hours. That benefit outweighed “a ton of candles.” The bottom line for Barnum is that “true economy consists in always making the income exceed the out-go.”

2. Take care of your health. Good health is the foundation of success in life and is also the basis of happiness, according to Barnum. Without good health, a person is very unlikely to accumulate a fortune – he’ll have “no ambition; no incentive; no force.” He recommends avoiding alcohol and tobacco, while also making other healthy choices when possible.

3. Persevere. To illustrate this rule, Barnum shares a line from Davy Crockett, “This thing remember: when I am dead: Be sure you are right, then go ahead.”

Everyone must actively cultivate a sense of “go-aheaditiveness,” according to Barnum, and must not become overwhelmed by the “horrors” or “blues.” Everyone will encounter difficulties and challenges – it’s how you respond that determines whether you’ll succeed or not.

4. Be cautious and bold. This one appears to be a paradox, but it is not, writes Barnum. He believes “you must exercise caution in laying out your plans, but be bold in carrying them out.” A man who is all caution won’t take on the risks necessary for success, while a man who is “all boldness, is merely reckless, and must eventually fail.”

5. Use the best tools. Barnum believes that workers must always have the very best tools to do their work. As a businessman, he feels there is no tool he should be, “so particular about as living tools.” When looking for employees, therefore, one “should be careful to get the best.”

6. Be focused. Barnum urges the aspiring entrepreneur to focus on “one kind of business only, and stick to it faithfully until you succeed, or until your experience shows that you should abandon it.”

This rule is related to persistence in that sometimes we have to keep at just one thing until we’re successful. Barnum warns that “many a fortune has slipped through a man’s fingers because he was engaged in too many occupations at a time.” As Steve Jobs realized, focus sometimes means “saying no to the hundred other good ideas that there are.”

7. Advertise your business. Barnum was a remarkable pioneer in the field of advertising. For one of his promotions, he was able to transform a five-year-old dwarf named Charles Sherwood Stratton into “General Tom Thumb, Man in Miniature.” Tom Thumb eventually became a gigantic hit in Europe, and was received by Queen Victoria and numerous other crowned heads-of-state.Thumb and Barnum

P.T. Barnum and Tom Thumb

8. Be polite and kind to your customers. P.T. Barnum actually never said “there’s a sucker born every minute.” Instead, he had great respect for his customers. He writes, “the man who gives the greatest amount of goods of a corresponding quality for the least sum (still reserving for himself a profit) will generally succeed in the long run. People don’t like to pay and get kicked also.”

9. Preserve your integrity. Barnum concludes his work by saying to all men and women, “make money honestly.” He sincerely believed that the desire for wealth is laudable as long as the “possessor of it accepts its responsibilities, and uses it as a friend to humanity.”

This final rule, in relation to Barnum’s career, requires some context. In a lot of his promotions, he was known to bend the truth somewhat, so “integrity” might not have been the first word that came to the mind of his contemporaries. For example, he once exhibited an African-American woman who was supposedly 161 years old, and was formerly George Washington’s nurse. When challenged about the truth of this promotion, he replied, “the story seemed plausible.”

For pic o’ day, here’s one that Stacey S. sent yesterday, with all the snow forecast:snow employment

Real Estate Scam Story

NBA basketball players are known to make big money. That doesn’t mean that they make good investments. The Columbus Dispatch is reporting that players from the Miami Heat were caught in a multi-million dollar real estate scam.

According to recent testimony in an Ohio Federal Court courtroom, witnesses testified that Florida residents invested over 8 million dollars with Haider Zafar. Zafar has been indicted with 135 counts of fraud. The indictment  describes a scheme that he used to swindle money involving a real estate and a promise of amazing profits.

According to testimony, Zafar claimed that his uncle was Pakistan’s defense minister, which gave him the authority to buy and sell property for that country. So, he promised investors like Heat players Mike Miller, Rashard Lewis and James Jones that if they invested in Pakistan properties, they would be guaranteed a profit through his contact.  A simple idea, buy low and sell high… to that government.

Unfortunately for them, he had no relative in government and could not promise a profit. Evidence suggests that he also purchased little or no properties. A story that we will probably soon see on some American Greed episode.

For our DID YOU KNOW, it’s another math puzzler. If you take any number between 1 and 9 and multiply it by 9, then the sum of those two numbers will always equal 9. Here’s an example: 7 muliplied by 9 equals 63.  So… 6 plus 3 = 9.   Another????      3 x 9 = 27. So… 2 plus 7 equals….. 9!

And finally in pic o’ day… some courtroom drama?

courtroom drama

 

Awkward and Blinker

     I am still feeling a bit blog lazy, so I figured that a couple of pic o’s and a “Did you know?” would be our Tuesday blog. Plus, who wants to read a long blog in the heat. (Yes… that’s what I am selling!)

     Did you know that the only three non-Presidents to be pictured on U.S. paper money are: Alexander Hamilton (the $10 bill); Benjamin Franklin (on the $100 bill) and Salmon Chase (on the $10,000 bill)?  Of course, that raises the additional questions of who is Salmon Chase and is there still a $10,000 bill? 

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The Interest Catches Professor

     A true “if only” story from TimesDispatch.com. Or, it could simply be called a story about stealing and getting caught.

     In 1975, James Hardigan became a dental professor at Virginia Commonwealth University. In 1980, he became the associate dean for administrative affairs for VCU’s Dental Faculty Practice Association. In 2004, he retired from VCU and subsequently moved to Florida. What happened in between just caught up with him.

     Records show that in 1995, Hardigan opened up an investment account in the Dental Association’s name using the Association’s funds, for an initial deposit of $500,000. In 2004 when Hardigan retired, he transferred the account balance of $137,553 into his own personal account. The discrepancy of the 500K used to open the account versus what was transferred is still unclear.

     At the time of the amount transferred, apparently there was still a few cents that had not been credited for the monthly statement. Those pennies remained in the account after the transfer. In 2013,  the investment firm where the account had originally been opened contacted VCU and the Dental Association about the account. By now, 63 cents of interest  had accrued in the account. 

     Because the Association knew nothing of the account, school officials began looking into it. Soon, they learned about the funds and the transfer that went into the retired professor’s account.

      This past Thursday, Hardigan was in Richmond Circuit Court where he pled¹ guilty to felony embezzlement of $137,553. The details of his past caught up with the 69-year-old former professor. He probably once thought, “if only I had waited until the end of the month to get those remaining cents”. Or, maybe now he is saying, “If only I had not done it”.   The retired professor now awaits sentencing on August 9, which could be as much as twenty years.  

(¹ ABA Journal says that pleaded is also correct.  In US Supreme Court opinions “pleaded” was used 3,000 times and “pled” was used 26 times )

     This pic o’ seems appropriate for a Monday morning:

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Money Stumbles

 

I just had breakfast with someone who was bemoaning the fact that he has no 401K. One of his new year resolutions is to get started on retirement.

I just met with a financial planner; He admitted that he was frustrated with himself. A lot of the recommendations that he gave to clients was advice that he couldn’t always follow, because of life circumstances. Finances make it harder for him to put as much money aside as he thinks that he should.

Both of these men were saying what most all of us are saying. We know the road to take but it’s not always easy to get there. In my area of law, there usually is an event that has derailed any attempt at setting something aside right now. That adds to the frustration of a client who is trying to get medical treatment; trying to get better; trying not to miss too much work and still trying to make ends meet.

In a time of crisis, it’s almost a guarantee to look back at the past and say, “I wish I would have (insert a multitude of thoughts). ConsumerReports.org has some good reminders on finances that I thought were good blog fodder. They are called “Seven money stumbles to avoid”. In good times, it’s hard to follow these; In hard times, it’s even hard to read them. Still, it’s a good list to work on to keep from making some of these financial stumbles:

  • Not updating wills and beneficiaries. Eighty-six percent hadn’t updated their wills or other estate-planning documents within the previous five years.
  • Not sharing information with family. In only 30 percent of households did both spouses know major details about the family’s finances and where to find account information.
  • Messing up on 401(k)s. About two-fifths of respondents set aside 6 percent or less of pretax income in defined-contribution retirement accounts, most likely missing out on free employer matches. Ninety-one percent never reviewed fund expenses within their plans, though those expenses play a major role in investors’ returns.
  • Underinsuring. A mere 36 percent of homeowners had purchased extended coverage on their homeowners insurance that covered the full replacement value of personal property. Only 20 percent of survey respondents had umbrella coverage to protect them from liability lawsuits.
  • Not planning for emergencies. More than 70 percent said they didn’t have an emergency fund that could cover three to six months of living expenses; 77 percent had not stored important financial information and contacts in a secure place.
  • Not checking credit reports. Four out of five respondents don’t review their three credit reports at least once a year, though they’re free and indispensable.
  • Mismanaging debt. Almost one-fifth of those surveyed had revolving debt on credit cards of at least $10,000. Of the almost one-quarter of respondents who were in debt for education loans, 47 percent had taken more costly private loans.

These really are reminders of preparation and paying attention. Insurance agents have even asked me to run some ads to remind people to buy more insurance. Usually when you need it, you really need it and that’s because the person that hits you either has no insurance or very little. If you carry more than minimum, at least your underinsurance coverage can help with your losses, and then your insurance company can even go after the defendant to pay them back.

For pic o’ day, my mom sent me this one, with some real investment advice!

 

Stress And Money

USA Today had a weekend article titled  “More Money, More Problems?  Why Rich Kids Hate Mom and Dad”.  The premise of the article was that  money is a magnifier of family tensions, in wealthy families.

Author Franco Lombardo wrote a book, with studies to support,  that the rich are not happy in their family relationships. He asks why 70% of family businesses do not pass successfully to the next generation?  His answer: emotional and bad issues are brewing in wealthy families.

As a wealth and financial planner, he believes that wealthy kids have problems with their parents because of three common reasons: 1. A child of wealthy parents grows up with a sense that they get whatever they want. Then, when they go out into the real world and the world tells them “No”, they are not prepared for it and resent their parents.

His second reason for the emotional turmoil is his belief that wealthy parents end up being absentee parents. So, kids feel abandoned.

Third, he says that society makes fun of rich kids. They are always faced with scorn or jealousy. According to him, kids then blame their parents for issues regarding their identity. He puts his theories and “findings” in his book titled “The Great White Elephant: Why Rich Kids Hate Their Parents”. (not so sure I agree with this)

Sometimes authors write things… just to be authors. I think that we have all heard that money doesn’t buy happiness; Even if the belief is that it is easier to be rich and unhappy, than poor and unhappy. But, for the purposes of this blog, there’s an application to personal injury law. It is the opposite of having too much.  A completely different emotion.

I recently had a lady tell me that she had just lost her job.  Now, she is starting to get worried because her severance pay is running out and she still has not found a job.  Which is more stressful to her… Not having money or not having a job?

When I send in settlement packages to insurance adjusters, they like specific numbers to support the loss. What were the medicals and what were the loss of wages? How much did it cost to fix the car?

In the beginning of the blog, I discussed books on those that have money. Their problems come from having it. Those without, have problems that are way more than emotional. It is actual loss.

The loss of a job is a loss of money, but the worry is even greater. That is a damage in a case that can almost not be measured. For some adjuster putting some dollar amount on the loss, I suspect that they would put a greater amount if they were also facing the loss of their job.

In jury trials, the laws of evidence say that you cannot argue the golden rule. When arguing a settlement value to an adjuster, I still always hope that they will somehow place themselves in the position of appreciating the world of loss and worry.

For pic o’ day, here’s putting yourself in someone else’s position!

Bank Error: Bad Money

In the game of Monopoly, it’s exciting to pull the Community Chest card and collect $200. You don’t have to give it back.

What would you do if you just found out that your bank made an error and put a bunch of money in your account. Well, it just happened to an Indian school teacher.

Parjat Saha discovered that his bank had made a 9.8 Billion dollar mistake, when he recently checked his balance. The school teacher, who has a monthly income of about $700, was expecting a balance of about 10,000 rupees (now that would surprise me if I found a rupee in my account… just saying) which is about $200.

When Saha noticed the mistake, he called his bank. It quickly corrected the error. They didn’t even give him a lollipop for his call.

Of course, this brings up the question, “what if you don’t tell the bank about their mistake?” You know, the old “Finders-Keepers Losers-Weepers” law.

DailyFinance.com tells the story of a few others who made a different choice. New Zealand couple, Leo Gao and Kara Hurring were in celebration mode, when they discovered that their bank had made a $6.2 million credit mistake in their account. They quickly withdrew $2.3 million and went on the run. They since have been caught and Hurring goes to trial in February, while Gao is waiting for a trial date.

Susan R. Madakor,  a Brooklyn, N.Y. woman, found a $701,998 windfall in her Chase Manhattan account. After spending it, she was charged and ended up spending two years in prison, for larceny and bank fraud.

When a bank makes a mistake and takes too much out of your account, there is a Federal Law that controls how long you have, to notify them of the mistake. Otherwise, the bank may have no requirement to reimburse you. Although, practically, they probably would still correct it.

The Electronic Funds Transfer Act gives you sixty days to notify the bank of their mistake, if they have shorted you. That’s sixty days from the date that the statement was sent, that contained the error.

The Federal Government has 5 years to prosecute most criminal fraud. As to bank fraud….. Federal Law (18 USC 1344) gives banks special protection in the form of a 10-year statute of limitations.

     Let’s see how that balances on the fairness scale…. 60 days for us to point out that the bank shorted us; or the bank with 10 years to come get their money. Maybe country singers shouldn’t sing about letting your boys grow up to be cowboys. Let them grow up to be banks!

     One last note on honesty comes from a Thomas Jefferson, in a  letter that he wrote to Peter Carr. “He who permits himself to tell a lie once, finds it much easier to do it a second and third time, till at length it becomes habitual. He tells lies without attending to it, and truths without the world’s believing him. This falsehood of tongue leads to the heart, and in time depraves all the good dispositions.”

With a nod toward technology….. pic o’ day cartoon.

Puttin’ on the Ritz

     The BBC had a sitcom titled “Keeping Up Appearances“. The main character, Hyacinth Bucket, insisted that her last name be pronounced with more style, “Bouquet”.

     The entire premise of the show was about social climbing and thus, keeping up appearances.. This even included that she would answer the phone, “The Bouquet residence. The lady of the House speaking.” 

     I was reminded of that TV series when I read the Richmond Times Dispatch article regarding the bankruptcy of one time socialite, Patricia Kluge. Now, I am not trying to be judgmental of this filing. Many people are also going through hard times.

     The news article discussed that she and her current husband  just met with creditors and the appointed bankruptcy trustee, to review their chapter 7 bankruptcy filing. The bankruptcy filing currently lists 2.65 million in assets and 47.5 million in liabilities. Quick math tells me that this is a deep hole of debt.

     Here’s where the idea of keeping up appearances popped in. The couple, in their filing, are seeking Court approval of their bankruptcy filing. They have also listed that they currently have $15,698 in monthly income; and beyond the liabilities that they want discharged, they have on going monthly expenses of $20,750.

     This is like the problems facing our government. It’s hard to cut back. At the same time, neither republicans nor democrats can agree on how to move forward.

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