LWA News

• Zuzana Harvis and Diahann were interviewed for a great article in NJBIZ about working for small firms vs. large companies.  Zuzana shared her experience in working for LWA, leaving LWA to work for Bank of America, and then coming back to LWA.  A happy ending for all, except Bank of America, that is.

• Diahann was interviewed for an article in the July issue of Tax Hotline titled “Investors:  Take Losses Now for Tax Benefits Tomorrow.”  

• Diahann just completed writing a chapter for a book to be published later in the summer titled Inside the Minds:  Wealth Management.  She was also interviewed for a book on moving from the corporate world to small business.  This book is part of a series being published by the National Association of Women Business Owners (NAWBO).  

• Jodi A. Cirignano, CFP^®, CPA has been promoted to Director of Financial Planning.  We are very excited about her expanded role in leading the financial planning team and taking a more active role in the strategic direction of the company.

• Diahann was quoted in an article by Jerry Edgerton for Home & Family Finance Magazine regarding auto affordability.  The article, ‘Deciding What Car You Really Can Afford,” is featured in the July issue and was distributed by the Credit Union National Association.

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Identity Theft Revisited

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By Diahann W. Lassus, CFP^®, CPA

Every day I hear about more issues with identity theft.  It seems that these thieves are incredibly inventive in finding ways to steal.  They are also becoming very accomplished in using the internet to trick us into revealing passwords and other information to assist them in their theft. 

It seems that Identity Theft is now the most common cause of consumer fraud complaints in the United States.  Last year, more than 900,000 people had their identities hijacked.¹

This is such an important topic that we decided to rerun an article from the past with a few new notes from current experience.

Excerpt from Insurance Perspectives published by Personal Lines Insurance Brokerage, Inc.

THE RISK - While some identity theft happens on-line, the majority occurs off-line with thieves intercepting an individual’s mail or credit card receipts.  These thieves use a victim’s personal information to open credit card accounts, access bank accounts, purchase cars (and even houses) and ruin credit ratings for years.

Identity theft is not like a mugging or a burglary, where there is physical evidence of a crime.  You have to convince people you’re a victim of a crime, and that can take a considerable amount of time and money.  Statistics show that the average identity fraud victim spends 175 hours and more than $1,000 straightening out the problem.

PREVENTING IDENTITY THEFT - While you can’t be certain that you won’t be the target of identity theft, there are some things you can do to safeguard against it, including:

• Invest in a shredder for credit card receipts, billing statements and discarded mail.
• Avoid giving your personal information, account information or Social Security Number to anyone over the phone or on-line particularly when you did not initiate contact.
• Obtain and review your credit report on a regular basis.
• Monitor your credit card statements each month and report any suspicious charges immediately.
• Tear up pre-approved credit card applications.  They are often targeted by identity thieves who easily convert them to fraudulent accounts.
• Consider identity fraud coverage.  Some insurance companies offer this coverage as part of your homeowner policy, and it can help defray the costs associated with reclaiming your identity.
• Don’t click on those links provided in an email when they ask for passwords or updating your personal information.  Go direct to the website.

 WHEN PREVENTION DOESN’T WORK - If you are a victim of identity fraud, take these steps immediately:

1. Place a fraud alert on your name and Social Security Number.  This alert means that any company that checks your credit knows your information has been stolen, and they must contact you to authorize new credit.
2. File a police report immediately in the jurisdiction where the ID was lost or stolen.
3. Cancel all of your credit cards immediately.

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What are Inflation Indexed Bonds?

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By Diahann W. Lassus, CFP^®, CPA

Inflation-indexed or inflation-linked bonds are designed to protect the purchasing power of an investor’s savings by indexing interest and principal payments to consumer prices.  If prices go up, so, too, do dollar payments from an indexed bond.

The Treasury started its indexed bond program in January 1997 by issuing 10-year inflation-protection bonds, with principal and interest payments linked to the consumer price index for all urban consumers (CPI-U). 

These bonds give investors two different payments:   INFLATION PAYMENT - Every six months, the principal is adjusted by an amount equal to the CPI, payable only when the bond is sold or matures.  INTEREST PAYMENT - Bondholders or the Bond Fund receives a check twice a year for an amount equal to the principal multiplied by the interest rate.

In the unlikely case of deflation, the adjustment can go down, but never below par. For example, suppose an investor purchased a $1,000 TIPS with a 4% real rate of return coupon (payable at 2% semiannually). If inflation over the first six months were 1%, the bond's principal would be increased to $1,010 ($1,000 times 1.01), and the first semiannual coupon payment would be $20.20 ($1,010 times 2%).

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