This edition of Footsteps Along the Path was initially issued by Clear Path Financial Education Services which has now become Kuehn Financial Education Services LLC. For more information about Kuehn Financial Education Services LLC, please email or visit www.kuehnservices.com.

Clear Path Financial Education Services believes:
If you build on your own skills,
Rely on your own abilities,
Increase your range of knowledge,
And get help when you need it,
You are the investment that will succeed above all others.

Welcome to the fifteenth edition of Clear Path Financial Education Services' Footsteps Along the Path. The goal of this newsletter is to provide relevant and succinct information on financial management to consumers and small business owners. It is designed to build upon previous issues, developing a clear path to financial freedom. Reader feedback is encouraged.

Please feel free to forward Footsteps Along the Path. If you have received this from a friend or colleague, and wish to be added to the newsletter distribution list, simply provide a response e-mail with this request. The same applies if you do not desire further contact. Your name will immediately be deleted from the list. dkuehn@clearpathservices.com

In this issue:
* Debi Kuehn in the Media
* Article: 6 Minutes and 49 Seconds to Financial Power
* A Knowledgeable Consumer is Powerful
* Bouncing a Check is Easier than Ever
Visit www.clearpathservices.com

Debi Kuehn in the Media
Read about how networking helps promote your business. I was interviewed while attending Glendale Library’s Women Business Builders held the second Saturday of every month at 2:00 pm. Thanks to Kathy Hamel, Glendale Library’s business librarian, for her efforts in supporting this group.
http://www.azcentral.com/community/westvalley/articles/1120wvangela1120Z1.html

6 Minutes and 49 Seconds to Financial Power
It took me exactly 6 minutes and 49 seconds to seize an initial step in financial power. I called for my free credit report. December 1, 2004 Arizona and other Southwestern and Western states started offering annual complimentary reports to its residents in response to the Fair and Accurate Credit Transaction Act (FACT). Credit reports detail your secured and unsecured debt and payment history. It influences your ability to get financial approval and at what rate. Credit history plays an increasing role as a deciding factor of employment and insurance rates.

The process for a complimentary report is simple. First provide or verify your name, mailing address, date of birth and social security number. If your phone number is registered under a name other than yours, the automated system will ask you to provide your name and proper spelling. My last name is different than my husband’s and the phone is under his name. It took a minute to update the system with my personal information.

In response to questions, you have an option of pressing the key pad of your phone or speaking. I found it easier to use the key pad. Sometimes when answering verbally, the automated system stated “invalid response”. Also, you have the choice of truncating your social security number on the mailed credit report. For safety sake, I requested only the last four digits of my social security number appear.

Please do not contact Trans Union, Experian or Equifax directly; instead to receive your free reports call 1.877.322.8228 or visit www.annualcreditreport.com. You need not order all three reports at once. You may stagger them over the year. I only ordered from Trans Union and plan to review the other reports through out the upcoming months. Surprisingly, my credit report arrived within four business days. The three digit credit score is not included in the information. The credit bureaus charge $5.95 per score. A phone number is listed to obtain it.

Why should you take advantage of this offer? United States Public Interest Research Group (USPIRG) states that 25% of credit reports contain major errors and 50% contain lesser errors. Why be denied a loan or pay higher interest or insurance rates because of inaccuracies? Clear Path Financial Education Services will help you interpret your reports and correct mistakes.

A Knowledgeable Consumer is Powerful

October 24th The Arizona Republic presented readers with a big spread about housing in Arizona. One article focused on the rising home values. Some zip codes have seen residential appreciation increase 21 percent since the start of 2004. This type of “paper” equity tempts consumers to tap into their home to finance all sorts of things from renovations to college tuition. Appreciation is considered “paper equity” because housing values change. It is not until the home is sold that the true worth is known. Banks permit home owners to borrow up to the current appraisal. Some lenders even push 125% loan to value equity loans. The 25% above the home’s value is considered a personal loan since the home does not back this portion. Personal loans are not tax deductible.

There are four ways to draw off equity: sell the house and purchase a less expensive home, cash out refinance, home equity loan, and equity line of credit. Financial professionals set up two camps on the use of home equity. Some find the tax deduction beneficial when other forms of debt do not offer it. Others state tapping equity only makes you poorer. Borrowers need to ask themselves, “what if something bad happens, can I pay this back?” Emergency savings and disability insurance should be a part of the financial plan. For information on tax deductibility visit www.irs.gov/pub/irs-pdf/p555.pdf.

Bouncing a Check is Easier than Ever Free credit reports are not the only news maker. Consumers also need to be aware of Check 21 Act which allows banks to transfer funds using electronic facsimiles of checks. This process moves funds instantly between the account on which the check is drawn and the account into which it is deposited, without the paper check ever changing hands. Therefore, the float factor of a few days becomes extinct.

The new rule of thumb is to pay bills only when money is available at the time of check writing. It is very important to balance your checkbook with this speedy banking method. Bouncing checks will be reported to ChexSystems, the “credit bureau” of banks. Ramifications of a bad report are denial to open bank accounts and rejection of checks written to cover store purchases at the point of sale. This is a procedure that will be phased in by banks. Contact your financial institution and ask when it will adopt Check 21.

A word to the wise, as a result of Check 21 Act, you may receive marketing material from credit card companies proclaiming ways to take control of your cash flow. Remember if you carry a balance, no grace period exists. You are charged interest from the date of purchase. This may be more costly than a bounced check fee.

Deborah A. Kuehn is the owner, educator and consumer advocate of Clear Path Financial Education Services. Clear Path believes knowledge is power and prosperity.

PH: 623.580.9293

Written by Deborah A. Kuehn, MBA
All rights reserved
Clear Path Financial Education Services is a registered trade name

Issue XV

December 7, 2004

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