Five tips for making the most of your tax return funds

By Jack Colbourne

Allstate Insurance

Plasma TVs. Getaway vacations. Shopping sprees.

The tax refund splurges of years past are not a reality for most Americans in 2009. Many people are likely wringing their hands over what to do with the money they receive back from Uncle Sam. Their concerns are well-founded: It’s more important than ever to consider the right options for your refund.

It’s also the right time for refund recipients to consider meeting with a financial professional who can help establish financial priorities and goals.

If you have outstanding bills or debts, take care of those matters first. But if you find you have money left over from your tax refund or have the full amount, don’t be scared of your options – be smart in your decisions.

Allstate recommends considering the following options to put your tax refund to work for you:

• Set up an emergency savings fund. Simply essential. The old conventional wisdom advised saving enough money to cover three to six months of unemployment. Many financial professionals now recommend keeping enough money stashed away to cover six months to one year of unemployment.
• Buy life insurance. Many people have only the life insurance plans offered by their employer. But your family needs protection whether you’re working or between jobs. There are two basic types of life insurance: term and permanent.  A financial professional can help you determine the type and amount of protection you may need.
• Contribute to or open an IRA. Yes, the market is unstable. But pulling out of a retirement plan altogether is not the answer. Both the traditional and Roth IRAs are great ways to save for retirement, although each offers different advantages. If you’re employed and have an IRA, continue contributing. If you’ve become unemployed, you might want to do a rollover from your retirement plan to a qualified IRA.
• Purchase a CD. If you don’t need immediate access to your funds, you may benefit from the fixed interest rates available with a Certificate of Deposit. You can buy a CD with a maturity or holding period as short as 30 days or as long as five years.
• Start or add to a college fund. Pay for the present, or save for your child’s education? That’s the agonizing decision faced by many parents considering a 529 College Savings Plan. But what many parents may not know is that the plan portfolio has different investment allocations based on the age of your child.

Don’t get caught up in the confusion over what to do with your tax refund. Consider a meeting with an Allstate Personal Financial Representative for a complimentary review of your current financial needs and see if you have what you need to protect what you have today and prepare you for tomorrow.

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer. Widely known through the “You’re In Good Hands With Allstate^®” slogan, Allstate is reinventing protection and retirement to help individuals in approximately 17 million households protect what they have today and better prepare for tomorrow. Customers can access Allstate products and services such as auto insurance and homeowners insurance through approximately 14,700 exclusive Allstate agencies and financial representatives in the U.S. and Canada, or in select states at allstate.com and 1-800 Allstate^®. Encompass^® Insurance brand property and casualty products are sold exclusively through independent agents. The Allstate Financial Group provides life insurance, supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers. Customers can also access information about Allstate Financial Group products and services at myallstatefinancial.com.

Securities offered by Personal Financial Representatives through Allstate Financial Services, LLC (LSA Securities in LA and PA.) Registered Broker-Dealer. Member FINRA, SIPC. Main Office: 2920 South 84th Street, Lincoln, NE 68506. 877-525-5727.

Life insurance and fixed annuities issued by Allstate Life Insurance Company, Northbrook, IL and Lincoln Benefit Life Company, Lincoln, NE. In New York, Allstate Life Insurance Company of New York.

Jack Colbourne is an Allstate Agent located at 720 East College Avenue, Salisbury, MD 21804- He can be reached at 410-546-9388.

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer. Widely known through the “You’re In Good Hands With Allstate^®” slogan, Allstate helps individuals in approximately 17 million households protect what they have today and better prepare for tomorrow through approximately 14,800 exclusive agencies and financial representatives in the U.S. and Canada. Customers can access Allstate products and services such as auto insurance and homeowners insurance through Allstate agencies, or in select states at allstate.com and 1-800 Allstate^®. Encompass^® and Deerbrook^® Insurance brand property and casualty products are sold exclusively through independent agents. The Allstate Financial Group provides life insurance, supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers.

Securities offered by Personal Financial Representatives through Allstate Financial Services, LLC (LSA Securities in LA and PA). Registered Broker-Dealer. Member NASD, SIPC. Main Office: 2920 South 84^th Street, Lincoln, NE 68506. (877) 525-5727.

ID Theft Guide

By Clark Howard

To protect yourself from becoming a victim:
•  Don’t carry a checkbook. Pay by cash or credit card.
•  Don’t carry your Social Security card with you or use your Social Security number as your driver’s license number.
•  Buy a paper shredder. Shred any documents listing your Social Security number and other financial information such as your bank account numbers and credit card numbers. This is the number one way of preventing identity theft.

If someone has taken your identity and is cashing your checks or using your credit cards, you should:
Report the situation immediately to your bank or credit card company. You may not have monetary liability because forgery and/or fraud is involved, but you will want the companies to be aware of the problem, as this is something that could affect your credit. In addition, follow these instructions to fully protect yourself:

a) Contact all three credit bureaus and issue a fraud alert. Check your credit report six months later and look for items you don’t recognize.
b) Provide a copy of your driver’s license to each agency’s fraud unit in order to register an affidavit.
c) Contact the proper authorities in writing, via certified receipt request.
d) Inform your local police department, Social Security Administration and all creditors with whom you have accounts.

Credit bureau phone numbers:
Equifax: 800-525-6285
Experian: 888-397-3742
Transunion: 800-680-7289
SSA Fraud Hotline: 800-269-0271

If a thief steals your identity and begins racking up debt:
a) Contact the fraud units of the three credit reporting agencies. Request that your account be flagged and add a victim’s statement saying, “MY ID has been used to fraudulently apply for credit. Call me at this number to verify all applications.” Find out how long the fraud alert will be posted and how to extend it if you need to. Check your credit report and look for items you don’t recognize.

b) Contact your credit card companies and financial institutions to report the fraud. Get new cards, have old accounts closed with a memo stating that the account has been closed at the customer’s request. Follow up in writing.

c) Call the police and get the crime on record, then get a copy of the police report. Keep a log of all conversations including date, name, phone number and the information provided.

d) Notify the Federal Trade Commission, which keeps a database of identity thefts. Phone: (888) FTC-HELP; Address: FTC, CRC-40, Washington D.C. 20580.

e) Notify you bank and if necessary, cancel checking and savings accounts and get new account numbers. Request a password that may be used in every transaction. Get a new ATM card, account number and password. Don’t use your SS # or birthdate as a password.

f) Don’t pay any bill or part of a bill resulting from identity theft.

Vehicle theft is the number one property crime in the country - costing Americans approximately $7.6 billion each year. The Insurance Information Institute estimates that auto theft and fraud increases insurance premiums for all drivers by $200 - $300 per year. The cost of a car has no relation to which cars are stolen, as most cars are stolen for the value of their parts. Thieves look for older vehicles that can be easily dismantled for parts, which can be sold easily and quickly. These parts can be worth 2 to 3 times more than the value of the vehicle. According to the National Insurance Crime Bureau, popular cars for thieves to steal are the Toyota Camry, Nissan Sentra, and Honda Accord and Civic. Also according to the National Insurance Crime Bureau, 62% of stolen vehicles are eventually found, with varying levels of damage. To safeguard vehicles against criminals, the most important step that consumers can take against vehicle theft is to have the right protection, keeping in mind that state-mandated minimum insurance coverage typically does not cover vehicle theft unless the consumer has included comprehensive coverage on the policy, in addition to collision and liability. To reduce the likelihood of becoming a victim of a crime involving your vehicle, the National Insurance Crime Bureau (NICB) recommends a “layered approach” to vehicle theft protection, including: Common Sense - Always lock your vehicle, close all windows and the sun roof, and take your keys with you. One out of every five vehicles stolen had the keys in it, and almost half were left unlocked. Warning Devices - Use a visible or audible device in your car such as alarms, steering wheel locks or VIN etching, so thieves will know your vehicle is protected. Immobilizing Devices - Smart keys, fuse cut-offs and kill switches prevent thieves from bypassing your ignition and hot-wiring your vehicle. Tracking Devices - The final layer of protection is a tracking device which emits a signal to police or monitoring station when the vehicle is stolen. These are very effective in helping authorities recover stolen vehicles.

Most home burglaries happen in broad daylight, during the middle of the day, when thieves know no one is home. Often, thieves will case certain neighborhoods, certain locations, to verify the time and day when people are gone — when they leave home to go to work and when they return home from work. Experts say having a dog is not enough. Burglars carry treats in their pockets to buy the dogs’ loyalty. But you can prevent your home from being broken into. To protect your property, get state-of-the-art locks, get an alarm system if you can afford one, and make sure you have adequate insurance. Keep an inventory of what you have in your home. If you have something of substantial worth, consider getting it insured separately. Experts say to store valuables in a safe place, make sure to lock all doors and windows, and don’t hide your keys in obvious places outside.