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DailyFinance.com

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    Financial Markets Wall Street
    Richard Drew/AP
    By Noel Randewich

    NEW YORK -- Wall Street racked up a solid week Friday, with health care, technology and consumer stocks making gains and investors looking beyond a widely expected December interest rate hike.

    The S&P 500 ended its strongest week in almost a year, while the Dow Jones industrial average erased its year-to-date loss, led by a 5.5 percent jump in Nike (NKE), which announced a $12 billion share buyback and a 2-for-1 share split.

    The sporting goods-maker helped send the consumer discretionary sector up 1.2 percent, making it the top gainer among the 10 major S&P sectors.

    There's more risk now that if they don't raise in December, then people will worry that we're still not out of the woods.

    Health care rose 0.7 percent, led by Allergan's (AGN) 3.5 percent increase. The drugmaker rose on reports that the U.S. Treasury's new tax inversion rules were unlikely to thwart its proposed deal with Pfizer (PFE).

    Minutes from the Fed's October meeting, released Wednesday, hardened expectations of a December interest rate hike and hinted at a cautious approach after that.

    Many on Wall Street believe that raising rates next month will be interpreted as a sign of confidence in the U.S. economic recovery.

    "There's more risk now that if they don't raise in December, then people will worry that we're still not out of the woods," said Jerry Braakman, chief investment officer at First American Trust, in Santa Ana, California, which manages $1 billion.

    With little inflation on the horizon, the Fed is likely to raise borrowing costs only gradually next year, which should help keep Wall Street content, Braakman said.

    The Dow Jones industrial average (^DJI) rose 0.5 percent to end at 17,823.81 points and the Standard & Poor's 500 index (^GSPC) gained 0.4 percent to 2,089.17. The Nasdaq composite (^IXIC) added 0.6 percent to 5,104.92.

    The S&P gained 3.3 percent for the week, its best showing since December. The Dow rose 3.4 percent for the week and the Nasdaq added 3.6 percent.

    Next week is likely to see tepid trading volume, with many investors taking time off for the Thanksgiving holiday.

    Movers and Shakers

    Alphabet (GOOGL), Google's parent company, rose more than 2 percent after Reuters reported the company was planning to launch the Chinese version of its Google Play smartphone app next year. The stock was the biggest influence on the S&P 500 and Nasdaq.

    Abercrombie & Fitch (ANF) surged 25 percent. Its quarterly profit more than doubled and same-store sales fell less than expected.

    Sprint (S) tumbled 5.4 percent after the wireless carrier said it would raise about $1.1 billion in cash through a sale and lease-back deal with a company backed by Japan's SoftBank.

    Tesla Motors (TSLA) lost 0.8 percent after it said it was recalling 90,000 Model S sedans to check for a possible seatbelt defect.

    Advancing issues outnumbered decliners on the NYSE by 1,819 to 1,249. On the Nasdaq, 1,751 issues rose and 1,014. The S&P 500 index showed 32 new 52-week highs and nine new lows, while the Nasdaq recorded 76 new highs and 81 new lows.

    About 6.9 billion shares changed hands on U.S. exchanges, below the 7.2 billion daily average for the past 20 trading days, according to Thomson Reuters (TRI) data.

    -Abhiram Nandakumar contributed reporting from Bangalore, India.

    What to watch Monday:
    • The National Association of Realtors releases existing home sales for October at 10 a.m. Eastern time.
    Earnings Season
    These selected companies are scheduled to report quarterly financial results.
    • GameStop (GME)
    • Palo Alto Networks (PANW)
    • Tyson Foods (TSN)

     

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    Worried Young Woman Doing Calculations
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    By Cameron Huddleston

    Managing your finances can be confusing. You might hear all sorts of advice that seems prudent. And you might assume that you're taking the right approach by acting on this advice.

    But what seems like a smart course of action might actually jeopardize your financial security. Here are 10 personal finance statements that financial experts have heard at least once from clients or others that weren't wise moves.

    1. 'I want to cash out my IRA and buy a new truck.'

    Jeff Rose, a certified financial planner and founder of Alliance Wealth Management, said a client once said he wanted to use the money in his IRA to buy a new fully loaded GMC Denali. It might have seemed like a good idea to Rose's client because he would be using his own money rather than borrowing to make the purchase. But there's a high price to tapping an IRA before retirement.

    "When I explained to him the taxes he would be paying by cashing out his retirement account were almost half of what the truck's sticker price was, he back pedaled a bit," Rose said. IRA withdrawals are treated as taxable income and subject to an additional 10 percent early withdrawal penalty if you take money out of your account before age 59½. Plus, cashing out an IRA before retirement might mean you won't have enough money saved to retire.

    2. 'I'm going to pull my money out of stocks and wait until the market straightens out to get back in.'

    Investors often say this during market downturns because they're afraid their investments will lose value, said Ken Weber, president of Weber Asset Management and author of "Dear Investor, What the Hell Are You Doing?" But their reasoning is flawed.

    "When you get out when the market is low, you're locking in your losses and you're locking yourself out of the eventual recovery," Weber said. As long as you have a diversified portfolio of mutual funds, you should stay the course during downturns.

    3. 'I'll save for retirement after I pay off student loans, buy a house and send the kids to college.'

    If retirement is far off in your future, it might seem smart to prioritize other financial obligations. "Saving for retirement is last on people's list in our immediate gratification society," said Robert Johnson, president and CEO of The American College of Financial Services, which provides education for financial professionals.

    However, time is what people need to be able to save adequately for retirement. "Success in investing is not about timing the market, but time in the market," he said. "You simply can't wait until retirement is approaching to start planning for retirement."

    4. 'Let's consolidate our credit card debt with a personal loan.'

    Using a personal loan that carries a lower interest rate can be a good way to pay off high-interest credit card balances and wipe out your debt quicker. However, if you continue using those cards and charge more than you can afford to pay off, then you are setting yourself up for financial trouble because you'll have a personal loan and credit cards to pay, said Michelle Black, a credit expert with the credit education and restoration company Hope4USA.

    "Consolidation must be coupled with a commitment to financial change," she said. "Otherwise, you are only creating a larger problem for yourself to try to deal with down the road."

    5. 'Take advantage of buy now, pay later.'

    This advice was given to Jason Hull when he was buying his first home. Hull, a certified financial planner and chief technology officer for online financial planning service myFinancialAnswers, was considering a Department of Veterans Affairs mortgage offer to veterans and service members that often doesn't require a down payment.

    "While putting no money down meant that we could purchase a house that we otherwise could not have purchased for lack of a down payment, it also encouraged bad financial behavior right as we were starting out: namely, buying now and paying later," Hull said. The better course of action is to rent until you've saved up enough for a 20 percent down payment so you're not saddled with excessive mortgage debt.

    6. 'The way this country is going, I don't want to invest.'

    Weber said that he's heard this countless times over the years because people are afraid by what they hear or read in the news. Don't let fear guide your investing decisions, he said. Instead, if you need guidance, hire a professional who can help you pick the right mix of investments that will offer growth while meeting your tolerance for risk.

    7. 'I have credit card debt but want to open a new card to get 25,000 airline miles.'

    As tempting as the offer may be, you shouldn't take advantage of it, says Heather Lovett, director of public relations for DealNews. "If you are carrying credit card debt, your only goal should be paying off that extremely expensive debt," she said.

    Most credit cards that offer travel rewards require that you spend a minimum amount to accrue points or free miles. "Those free miles will suddenly be very expensive when the $3,000 minimum spend costs you 22 percent in interest per year," Lovett said. "And if you fall further behind, your credit score will drop, making any future borrowing more expensive."

    8. 'I don't need to worry about retirement savings because I expect to get an inheritance.'

    It's unwise to assume that just because your parents are retired and seem to be doing well, you will inherit a significant sum, said Michael Fuhr, a certified financial planner with SageVest Wealth Management. Your parents may need a large portion of their assets for health-related expenses, especially if they require nursing home care and don't have long-term care insurance to cover it, he said. If there are multiple siblings, a potential inheritance may be reduced further.

    Or your parents might decide to spend their hard-earned money on themselves during retirement. "If you don't know what their plan is, then you can't assume it includes you in a significant way," Fuhr said. It's always best to be disciplined and save for your own retirement.

    9. 'Let's use our savings to start a business.'

    It's good to have an entrepreneurial spirit. But you should also realize that many businesses fail, said Priyanka Prakash, a lending specialist at FitBizLoans.com. "A lot of people with hopes of owning a business dump their entire life savings into it," he said. If the business goes belly up, they might have to declare bankruptcy.

    Prakash said new business owners should have saved enough to cover six to 12 months' worth of expenses to fall back on if the venture doesn't succeed or grow as fast as expected. He also suggested that they limit exposure to their personal assets by finding outside investors for their business.

    10. 'That won't happen to me.'

    People often assume they don't need to insure themselves against disaster, said Jeff Jones, a certified financial planner with Longview Financial Advisors. He also said that many believe they won't need long-term care.

    "We are living longer and a long-term-care need, such as an extended nursing home stay, may be one of the largest single financial risks to a retiree's financial plan," he said.

    The average annual cost of care in an assisted-living facility is $43,200 and is $91,250 for a private room in a nursing home, according to Genworth's 2015 Cost of Care Survey. Medicare offers limited coverage. Medicaid programs typically require that all of your assets are spent before coverage becomes available, Fuhr said. However, a long-term-care insurance policy can help offset the tremendous cost of assisted living and nursing home care.

    This story, 10 Infamous 'Last Words' of Personal Finance, originally appeared on GOBankingRates.com.

     

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    By Emily Lugg

    Chilly winter weather is synonymous with cozy sweaters, hot cocoa -- and steep energy bills. It's no surprise that running the heating system on high nonstop pushes monthly costs sky high. But there's no reason to go broke staying warm. Here are 15 energy-efficient tips that should make heating bills less burdensome.

    Take the heat down a notch. Each degree lower on the thermostat for a period of at least eight hours -- when everyone is asleep or at work -- can cut the heating bill by 1 percent, according to estimates by the U.S. Department of Energy. This doesn't mean freezing at night. Just throw on warmer pajamas or snuggle under an extra blanket.

    Install a programmable thermostat. Anyone afraid they won't remember to turn down the heat before leaving the house or going to bed should consider installing a programmable thermostat. These nifty devices control the indoor temperature 24/7 and will generate the most savings if no one messes with the settings when they feel chilly. Grab a sweater instead.

    Reduce drafts. Realize savings up to 30 percent on energy bills by covering up drafty windows and doors and sealing air leaks, according to the Department of Energy. A rolled-up towel is an easy and cheap way to stop a draft. Seal small spaces open to the outdoors with a scrap of fabric or an old necktie filled with sand. Cover up windows with insulating plastic to keep heat in.

    Install storm doors and windows. This is a more permanent way to cut down on drafts that enter the house through inefficient doors and windows. The home improvement site ImproveNet lays out the costs and the pros and cons of this project, and asserts it can boost a home's energy efficiency by 45 percent.

    Change furnace filters. Dirty furnace filters can restrict airflow, making the heating system work harder, which in turn can boost heating bills. Filters should be cleaned or replaced monthly during the cold season. Keeping tabs on the furnace filter also can pare medical bills. The more efficient the filter, the more allergens and debris it catches, thus preventing these irritants from circulating in the air.

    Run fans in reverse. Changing the direction of a ceiling fan can shave as much as 10 percent off monthly heating bills. Flipping a switch on the fan turns the traditional counterclockwise rotation that produces a cool breeze to a clockwise rotation that pushes warm air back into circulation.

    Turn down the water heater. The standard setting for a hot water heater is 140 degrees Fahrenheit. But The Simple Dollar notes that dialing down to 120 degrees, which is still plenty warm, can push energy costs down by 6 to 10 percent. Other strategies, such as a tankless or solar water heater, may have a bigger impact but require an initial investment of at least several hundred dollars.

    Be diligent about maintenance. Just like any other major appliance, a furnace needs regular tune-ups. Keeping it clean and properly adjusted helps it run efficiently and prolongs its lifespan. Check with the local utility company or the furnace manufacturer about annual inspections -- some offer this service at no charge. And plan ahead, because many consumers will be calling for a technician as the weather turns colder.

    Use caulk and weather stripping. Windows and doors aren't the only spots where warm air leaks out of the house. Keep an eye out for places where two types of building materials meet -- corners, chimneys, and around pipes and wires. Test for leaks by waving a stick of incense around the house and noting areas where the smoke wafts. Walk around the outside of the house with a hair dryer and aim it at trouble spots, such as windows; if a lit candle on the inside flickers or goes out, there's a leak. Plug up these energy suckers with caulk and weather stripping.

    Seal the ducts. The Energy Department warns that about 20 percent of heated air can escape through the ductwork in a house. Have the ducts evaluated by a professional to determine if sealing or any other improvement is necessary. Although there's a cost to these repairs, annual savings can hit $120. Properly sealed ductwork also better protects against dust and mold.

    Keep an eye on warm water usage. Who doesn't love a long, hot shower in the depths of winter? But the more water a shower head disperses, the more heat is needed to warm it. Installing a low-flow shower head saves money in two ways: It cuts down on energy usage as well as on water usage. Insulating the water tank yields even more savings.

    Look at the clock. Energy is cheaper during off-peak hours; that is, before about 7 a.m. and after about 10 p.m., depending on the local utility. Set the thermostat to heat the house shortly before and after off-peak hours end and begin, and to turn off when the desired temperature is reached. A well-sealed home will retain the heat until everyone leaves for the day or retires for the night. Also, running appliances at off-peak times shaves dollars off monthly energy bills.

    Heat a smaller space. Why heat the rest of the house when you're using only one room? Buy a space heater for about $30 and set it up in the most heavily used area of the home. By concentrating the heat in one spot, it's possible to lower the thermostat. Although running the portable heater certainly has a cost, it may be less than keeping the entire house at a toasty temperature.

    Block the chimney. Make sure the damper in the chimney is shut tight. This simple step will prevent heated air from escaping the home out the chimney. The financial benefits are apparent without making any additional investment.

    Insulate the attic and basement. Out of sight and out of mind, perhaps, but the cool air in uninsulated parts of the house contributes to the overall cost of heating. According to the Energy Star program, insulating an attic, crawl space, basement walls and the floor above an unfinished basement can reduce heating costs by an average of 15 percent. Although the price of insulating an attic can exceed $1,000, the investment should pay off in a few seasons.

     

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    Holiday meal
    Getty ImagesThanksgiving feasts can be tasty without being too pricey.


    With Thanksgiving fast approaching, many of us are already licking our lips at the promise of plump turkeys and flaky apple pies. But those of us who've hosted before know there can be a lot of time, energy and money that goes into laying out the Thanksgiving dinner table.

    With a bit of thoughtful planning and a resourceful shopping strategy, however, you can tackle Thanksgiving dinner without spending a fortune. Below, we've listed 12 frugal shopping tips for saving money while celebrating the season of giving.

    Start early. Thanksgiving planning should begin weeks before Thanksgiving eve. By planning ahead, you allow yourself time to hunt down the best deals and spare yourself the stress of rushing out to find a last minute item on Thanksgiving Day at a corner shop, where prices may be marked up. The more shopping and preparation you are able to do in advance, the more time you'll have on Thanksgiving to relax with family and linger over second slices of pumpkin pie.

    Map out your menu. It's easy to go off budget when shopping for Thanksgiving, when grocery stores employ a variety of marketing strategies to encourage customers to spend. To avoid overstepping your budget, plan your menu carefully and create a shopping list of items you'll need. Divide your shopping list into non-perishables; items you can purchase straight away; and products you need to purchase fresh a day or two before Thanksgiving.

    Narrow down your shopping list. Before heading to the supermarket, explore your pantry to see what items and supplies you already have. If you are inviting friends or family, call them up to ask if they would be willing to bring a side dish, appetizer or drink. Revisit your list to determine which items you can cross off.

    Do your homework. In an effort to compete for Thanksgiving Day shoppers, grocery stores often offer some serious deals on turkeys and other Thanksgiving staples. Check out the websites of your local grocery stores, or compare paper ads and circulars to identify which stores have the best deals on which products. Keep an eye out for coupons and specials.

    Take advantage of loyalty programs. You'll find that most major supermarkets have some kind of loyalty program that rewards members with exclusive deals and discounts. Safeway, Walgreens and Target all have attractive loyalty programs that are free to join. Take advantage of your store's loyalty program by signing up and using your card every time you shop.

    Avoid premade and prepared products. When it comes to side dishes, sauces and desserts, it pays more to do it yourself. Prepared foods and premade items are typically marked up anywhere from 40 to 100 percent. If you allot enough time to simmer up your own sauces, make your own stuffing and bake your own pies, you can maximize both savings and flavor.

    Don't shy away from generics. Buying generic or off-brand products doesn't mean losing out on taste. In fact, many generic products are comparable in every way to their name-brand counterparts in terms of ingredients and quality. Don't be afraid to go for generics over fancy labels, especially when it comes to dry goods, grains and frozen produce.

    Be flexible. While planning a menu in advance is essential, you should be prepared to tweak your list according to what's on sale. For instance, if you had been hoping to make a cherry cobbler, but you find that cherries are pricier than you expected this season, there's no harm in swapping out cherry cobbler for apple pie on your menu.

    Order cookware and gear online. In the weeks leading up to Thanksgiving, you can find great deals on cookware, serving utensils, tableware, Tupperware and other Thanksgiving gear on the Web.

    Go for dollar store decorations. Dollar stores can be a treasure trove of deals on paper goods. You can find everything from paper plates to festive decorations at dollar stores for $1 apiece.

    Be resourceful with leftovers. Before the big day, make sure you stock up on Tupperware and clear out plenty of space in your fridge to make room for leftovers. Leftover turkey can be transformed into hearty stews, spicy curry and kid-friendly sandwiches; while mashed potatoes can be cooked into savory potato and shepherd's pies. Our personal favorite post-Thanksgiving recipe is cranberry-carrot muffins made with leftover cranberry relish for tartness and moisture.

    Plan for next year. After Thanksgiving, harvest centerpieces, decorations and other Thanksgiving-themed merchandise is deeply discounted, as retailers clear their stores for holiday gear. Snatch up these deals today, and you can save yourself money and time next Thanksgiving.

    Maria Lalonde honed her deal-hunting skills while traveling through South America and Southeast Asia, combing colorful local markets for unique finds. Her love of blogging and thirst for deals brought her to Offers.com, where she blogs about savings tips.

     

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    woman struggling with paying bills
    Alamy


    Christmas is fast approaching, and that means money is going to start flying out of your pocket at breakneck speed.

    It doesn't matter how much we talk about the spirit of the season being what really counts. The reality is the holidays mean paying for presents, parties and extra food. If you are already struggling under a mountain of debt, it only gets worse.

    It may be tempting to think you'll charge one last holiday and buckle down in January, but that is the mindset that keeps you in debt.

    Trust me. I may be debt-free and have an emergency fund now, but I could tell you about the Christmas we searched for a tree farm that took checks because there was no money in the bank and the credit cards were maxed out.

    What changed? It wasn't our income, that's for sure. It was our mindset. Unless you change yours, here are five reasons you'll never get out of debt.

    1. You don't have a budget or track spending. Some people are number geeks and could spend all day slicing and dicing their budget numbers. You know who you are.

    For everyone else, budgets can be boring, restricting, dumb ... pick your favorite adjective.
    However, if you don't know where your money is going or even how much you make monthly, you'll never get out of debt. Every time you open your bank account, it will be a crapshoot whether there is money there.

    Tracking your expenses used to entail pencils, spreadsheets and agony. Now you can simply use a service like that provided by our partner, PowerWallet, to do everything for you effortlessly and free. No more excuses.

    2. You shop for fun. Once spending money becomes a form of recreation, you can probably kiss your savings goodbye. Unless you have a large amount of disposable income, chances are you can't afford to spend indiscriminately.

    People who shop for fun spend on a whim. They see something they want, and they buy it with no thought to whether they need it or can afford it. If you pass your time wandering aimlessly at the mall or surfing retailers online, don't be surprised if your savings account balance hovers around the single digits while your credit card balance climbs to its ceiling.

    3. You surround yourself with the wrong people. Likewise, you will never get ahead if you are running with a crowd that is constantly trying to "one up" one another. Keeping up with the Joneses is not good for your pocketbook.

    I don't want you to ditch good friends, but I do think it's smart to consider whether you need to spend time with casual acquaintances who are more interested in keeping up appearances than in keeping up your friendship.

    Instead, look for like-minded people who appreciate you for who you are even if you can't afford to be dining at that swanky new restaurant every week.

    4. You have an 'as soon as ... ' mentality. This was one of my downfalls: I always had an excuse for why I couldn't get my money under control.
    • As soon as the holidays are done, I'll write out a budget.
    • As soon as I get a better-paying job, I'll start paying down debt.
    • As soon as I finish buying the last of the Disney movies for the kids, I'll stop spending.
    The timing will never be perfect. Smart money management is like dieting and exercise: You will always find a reason to put it off. Waiting for the stars to align is a surefire way to remain in debt indefinitely.

    5. You have a character flaw. Let's get right down to it: You may be in debt and stay in debt because you are simply too lazy, weak or self-indulgent.

    Ouch.

    Remember, I've been there. I'm not judging; I'm looking in the mirror. We want to think our debt is the result of forces outside ourselves -- the hospital stay, the lousy economy, the housing market. However, at the end of the day, we need to take responsibility for our own actions.

    I am not talking about people living in poverty, and I am not talking about those who experienced something catastrophic, such as a total disability, that pushed them over the edge.

    I am talking about middle-class families who live like upper-class families even though our paychecks can't support the lifestyle. We need to acknowledge our part in our debt.

    Just maybe if we lived below our means and saved for a rainy day, we would be able to weather life's storms a little better.

    My character flaws were self-indulgence and weakness. I had a hard time saying no to myself when I could so easily justify purchases with the idea that "everyone uses credit cards."

    By the time I hit that fateful year in which I had no money and no tree a week before Christmas, I had dug myself a deep hole. It took me nearly 10 years to climb out.

    But today, I have money in the bank and don't freak out when the van makes a strange noise because I know I can pay for a repair. It's a wonderful feeling. I love living this way, and I know you will too.

    What do you think? Am I wrong about why people stay in debt? Feel free to tell me in our Forums. It's the place where you can speak your mind, explore topics in-depth, and post questions and get answers.

    Like this article? Sign up for our newsletter and we'll send you a regular digest of our newest stories, full of money saving tips and advice, free!

    Household Debt at Highest Level Since 2010: NY Fed

     

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    Amazon.com Illustrations Ahead Of Earnings Figures
    Daniel Acker/Bloomberg via Getty Images
    By Rebecca Borison

    Amazon.com (AMZN) is known for keeping quiet when it comes to numbers on its Prime membership program, but analysts certainly have high hopes for the subscription service.

    Ben Schachter, an analyst at Macquarie Securities, recently told The New York Times that by 2020, he expected half of American households would be Prime members. He added that the prediction was conservative. By some estimates, Amazon Prime already reaches about a third of U.S. households.

    In 2013, Amazon shared that it had "tens of millions" of Prime members worldwide, and at the end of 2014, the company said global Prime subscriptions were up 53 percent and North America subscriptions were up 50 percent. But beyond those teases, Amazon has remained tight-lipped.

    When asked about Prime growth during the third-quarter conference call, Amazon CFO Brian Olsavsky merely said, "We are very happy with the growth, not only in participation, but also purchases and retention, and we had a very successful Prime Day in July that we're really happy [about]."

    The Consumer Intelligence Research Partners estimates that Amazon has reached 44 million U.S. Prime members, and according to analysts at Cowen, U.S. Prime subscriptions reached 40 million in October.

    The question now is how much room there is for growth. Schacter, who estimates that Amazon will have at least 40 million Prime subscribers globally by the end of the year and possibly as many as 60 million, sees the U.S. growth trajectory continuing to a point where at least 50 percent of American households have Prime. There are currently about 115 million households in the U.S., according to Census data, which implies that Schachter believes Amazon will reach at least 58 million Prime subscriptions in the U.S. in the next five years.

    Schachter didn't immediately respond to a request for comment for this story.

    Other analysts agree seem to suggest this milestone could be reached even sooner.

    RBC Capital Markets analyst Mark Mahaney thinks the U.S. number could already be close to 50 million, based on a September survey of 1,617 U.S. consumers in which 40 percent said they were Prime members.

    Needham analyst Kerry Rice also believes Prime is well on its way.

    "If the estimates are correct that there are 30 to 50 million Prime accounts [in the U.S.], it seems that reaching 58 million households should be achievable," Rice said. "The implications are certainly positive for Amazon, as Prime members spend significantly more than non-Prime members."

    Prime membership costs $99 a year and includes free two-day shipping along with a number of other benefits like video and music streaming, cloud storage, and access to Prime Now, which delivers select products within an hour.

    Assuming Amazon keeps the cost of Prime membership at $99 a year, those potential 58 million households in 2020 could generate as much as $5.7 billion a year in revenue.

    But for Amazon, it goes well beyond the annual fee. Prime members tend to spend much more with Amazon than non-Prime members and are incredibly valuable to the company.

    ITG analyst Steve Weinstein estimated that Prime members spend $1,000 more a year on average compared to non-Prime members, and research firm Millward Brown estimates Prime members are almost five times more likely to make a purchase in the same shopping session compared to non-Prime members.

    "What our data suggests is that Prime Members are materially more loyal (more spend, more purchases, more satisfaction, more intent to spend) than non-Prime customers," RBC's Mahaney wrote in a note in September. "What is more, our analysis suggests that as Prime Members mature (Year 1, Year 2, Year 3, etc.), they also become materially more loyal (more spend, more purchases, more satisfaction, more intent to spend)."

     

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    ShutterstockBefore uprooting your life, consider if the money gained is worth the perks you'll lose.
    By Nicole Schreck

    If there's one thing all renters worry about, it's how much they're paying for rent. While most financial experts agree that the amount you pay monthly should be less than a third of your monthly income, young renters with entry-level salaries sometimes have a tough time paying less than half of what they make.

    This is especially true in big cities. For example, take San Francisco: The median rental rate for a one-bedroom is $3,931 a month, according to Rent.com data, and the census says the per capita income is $48,846. Let's do some quick math: The cost of renting a one-bedroom apartment for 12 months in San Francisco at the median rate is $47,172 -- or 97 percent of the per capita income for the city.

    With rent prices going up across the country, many apartment dwellers are questioning whether paying so much is even worth it. While many people would never give up a great location downtown -- even though they're paying a few thousand more each year -- others may wonder if moving farther away from cities for cheaper rent could help them create a more fulfilling lifestyle. So, what do you think? Is relocating to give yourself a financial break worth it? Here are some tips to help you decide.

    Think about the other side of the coin. If you're considering relocating to a smaller city, town, suburb, or a less expensive neighborhood, you're likely considering the benefits. And these advantages are nothing to scoff at, either: Paying less for rent means more money for necessities, entertainment, savings and retirement. In turn, this means less financial stress overall. For most people, that would be a huge weight lifted.

    However, before taking the plunge and relocating, it's crucial to look at the flip side of the coin. You know what you're gaining, but what might you be giving up? A great location with a lot of things to do nearby? Living in the same city as your friends or family members? Being a quick jaunt away from work on public transit? These factors should be considered.

    Give the commute a try. For many, relocating to pay less in rent means lengthening their commute substantially. Some people in this situation opt to find another job, while others choose to commit to the long commute. However, it can be easy to underestimate the toll of this longer trip from home to work.
    Tacking on an extra 45 minutes to and from work takes almost two hours out of your day. Before committing to the relocation, give the commute a try and see how long it will realistically take. Will you be able to handle it daily if you decide to move?

    Ask friends and relatives. It's never a bad idea to talk to your friends and relatives about whether relocating is right for you. In particular, try to talk to someone who lives in the city or town where you're considering relocating. Does he or she think the move will be worth it? Is it a place he or she could see you flourishing?

    Do some exploring. If you do decide to relocate, what will you miss most about where you currently live? If you live in a big city, spend some time exploring your favorite places and neighborhoods, and really think about whether you would miss having easy access to them.

    Then, explore areas of the city you don't know as well. Walk around neighborhoods that are less expensive than where you're currently living, and see what they have to offer. Maybe you'll find that relocating to a neighborhood that doesn't cost quite as much is a good compromise.

    Don't forget to consider the costs of moving. Moving isn't cheap, so taking all your belongings to a new city or town is probably going to cost you a pretty penny. Whether you hire movers or try to do the whole move yourself, you'll likely drop at least a few hundred dollars on packing and transporting everything, and even more applying for a new apartment and putting down a security deposit.

    If the amount of rent you pay drastically decreases, these moving expenses will balance out over the first few months following your move -- but you'll need to make sure you have some money saved to cover the upfront costs.

    Consider your quality of life. All the tips outlined above are really just about weighing the pros and cons of relocating. In the end, a move out of a city is right for some people and not for others. Consider what you'll be giving up if you relocate, and decide if paying less in rent each month is worth that loss. If you think moving will give you a better quality of life overall, then what are you waiting for? Take the plunge, and do what you know is right for you.

    Niccole Schreck is the rental experience expert for Rent.com, a free rental site that helps you find an affordable apartment and provides tips on how to move.

     

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    woman shocked at reading her credit card bill / bank statement
    Alamy
    By Karla Bowsher

    Your wireless bill may have fallen in recent years, but costs are increasing in one area.
    The taxes and fees tacked onto wireless bills have increased in all but one state this year -- and increased to a record high average, the Tax Foundation reports.

    Federal, state and local fees now amount to nearly 18 percent of the average U.S. wireless customer's bill, an increase of about 1 percent from last year and "almost two and one half times higher than the general sales tax rate imposed on most other taxable goods and services," the foundation reports.

    The nonprofit research and educational group explains in a blog post:
    Wireless industry competition has led to significant reductions in average monthly bills, even as consumers get new and expanded wireless plans. However, the consumer benefits of lower wireless prices have been partially offset by increases in government taxes and fees.
    From 2008 to 2015, for example, the average monthly wireless bill decreased from just under $49.94 to $46.64, or nearly 7 percent.

    But going back to 2003, the combined federal, state and local burden increased from an average 15.27 percent to 17.96 percent.

    The only state that didn't increase its wireless taxes this year is Florida. The governor and Legislature opted to reduce Florida's Communications Services Tax to 7.44 percent from 9.17 percent, which the Tax Foundation reports will provide more than $100 million in tax relief for wireless customers and businesses in the Sunshine State.

    Partially as a result of that decrease, Florida is no longer among the five states with the highest wireless taxes, but it remains among the top 10 states:
    1. Washington - 25.15 percent
    2. Nebraska - 24.99 percent
    3. New York - 24.36 percent
    4. Illinois - 23.92 percent
    5. Missouri - 21.25 percent
    6. Rhode Island - 21.16 percent
    7. Florida - 21.12 percent
    8. Arkansas - 20.77 percent
    9. Pennsylvania - 20.60 percent
    10. Kansas - 19.99 percent
    How do you feel about your wireless taxes and fees? Share your thoughts below or on Facebook.

    Like this article? Sign up for our newsletter and we'll send you a regular digest of our newest stories, full of money saving tips and advice, free!

    How to Save 50 Percent on Your Cell Bill

     

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    Dec. 22, 2010 - Modesto, California, U.S. - DARRYL BUSH/dbush@modbee.com - Finn Johnston, 4, of Modesto donates to the Salvation
    Darryl Bush, Modesto Bee/ZUMAPRESS.com/Alamy
    By Brian O'Connell

    Jim Wang and his family like to carve off some of the family holiday season budget for a great cause -- giving to the needy.

    So far, his creative way of doing so has helped changed his view of the holidays from receiving to giving.

    "A few years ago, we started a charitable giving fund during a year we expected to be taxed heavily," says Wang, a Pittsburgh resident who writes about personal finance for Wallethacks.com. "We contribute to it on a regular basis, so it's part of our monthly budget. Then, at the end of each year, we recommend where a portion of those funds are donated. It never busts our budget because we make regular contributions and we can support our favorite organizations."

    The practice allows Wang and his family to give during the holidays on their own terms. "A good side benefit is that it gives us a good reason not to contribute to certain causes when friends and family ask us -- we don't have the available funds in our charitable giving fund but we'll allocate it for next year," he says.

    That would make Wang a prime candidate for the newest theme day on the holiday map -- "Giving Tuesday."

    Giving Tuesday, which occurs right after Cyber Monday, was founded in 2012 as a way to recognize the more than 1.5 million charities in the U.S. and kick-off giving season, during the last five weeks of the year when at least 24 percent of all charitable donations are made (which amounted to about $358 billion total in 2014).

    U.S. companies are already climbing aboard the Giving Tuesday bandwagon. PayPal (PYPL), for example, is attempting a Guinness World Record for Giving Tuesday this year by going after the most money raised online for charity in 24 hours. Last year PayPal enabled a record amount of giving around the world by helping charities raise $5.7 billion through its charitable giving platform, company officials tell MainStreet.

    The key for U.S. adults looking to cut a check or two on Giving Tuesday is obviously to help the less fortunate. Past that, you'll want to give "in a smart and strategic way, maximizing every donation and doing so within your budget," says Eileen Heisman, CEO of the National Philanthropic Trust and #GivingTuesday ambassador.

    Actual charities love the idea. "Giving Tuesday reminds us to be selfless and share a bit of our own good fortune with those in need," says Cristy Balcell, executive director at MitoAction, an organization dedicated to helping children and families who suffer from the rare disorder mitochondrial disease. "I know we appreciate Giving Tuesday's national effort to join together."

    So flex your charitable giving muscles by participating on Giving Tuesday.

    Start by using the website CharityNavigator.org to find the best and most legitimate charities. The site's unbiased, objective, numbers-based ratings system to assess 8,000 of America's charities.

    CharityNavigator provides rating based on charity's financial health, transparency and accountability, and it tracks how efficiently the charity will use your donation and how well has it sustained its programs and services over time.

    Gift cards are also a great way to give to charities during the holidays. "There are two types of charitable gift cards," states Shelley Hunter, a content manager at GiftCards.com. "The first is when a percentage of sale is given to charity. In this type, the recipient gets the full value of the gift card to spend. The charity gets a small portion. The second type of card results in the nearly the entire sale going to charity. The recipient simply designates where the money should go. This is a great way to do your holiday shopping and give back at the same time."

    Hunter offers a great list of charity-driven gift cards.

    It's also OK to get something in return when you donate to charity. "Look for a charity that offers something in return for your contribution, but be aware of where your dollars will go for that gift," says Suzanne Kwok, executive director of Give To Cure, a charitable group that leverages crowd funding to raise funds to treat diseases. "For example, we have partnered with world famous street artist and activist Shepard Fairey to create fashionable merchandise and actual gifts that people can buy. Any money spent on those items goes directly to supporting clinical trials for Alzheimer's disease. This way, you get to do a good deed, and your loved one still gets something cool to unwrap and love all year."

    Get your kids involved in donation experiences, too. "Teach your children to give what they can," says April Masini, a relationship and self-help expert. "A week of their allowance donated is a great teaching moment at this time of year when 'gimme gimme' is the mantra in many homes where retail is the religion of choice."

    Of course, keeping a close eye on scams and fraud should be a priority for donors on Giving Tuesday, too. "Scams are abundant during the holiday and scammers prey on the generous holiday spirit of consumers to 'give extra' to charities," says Kiry Peng, president of the Business Consumer Alliance in Colton, California. "Our best tip is to avoid sending cash donations and never wire money. Donating by check made payable to the charity or by credit card is safer and consumers can use those receipts as tax deductions."

    Giving Tuesday is yet another theme-based date on the holiday character, much like Black Friday and Cyber Monday. But unlike those commercially driven mini-holidays, Giving Tuesday offers Americans a chance to do well by doing good, and that's much closer to the spirit and meaning of Christmas and the holidays.

     

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    FILE - In this May 4, 2014, file photo, the Pfizer logo is displayed on the exterior of a former Pfizer factory in the Brooklyn borough of New York. Pfizer and Allergan have reached a $160 billion deal that creates the world�s largest drugmaker by sales, the companies announced Monday, Nov. 23, 2015. (AP Photo/Mark Lennihan, File)
    Mark Lennihan/AP
    By LINDA A. JOHNSON and TOM MURPHY

    A $160 billion deal announced Monday to merge Pfizer and Allergan and create the world's biggest drug company renewed the outcry in Washington over "inversions," in which U.S. corporations combine with companies overseas to lower their tax bill.

    The combination -- the second-largest merger in history -- could have ramifications around the globe, pushing up drug prices and spurring more such deals in the fast-consolidating health care sector and other fields.

    It is also increasing the election-year backlash from U.S. politicians who have been criticizing drugmakers recently over medicine prices that sometimes exceed $100,000 a year.

    In what would be the biggest inversion ever, Pfizer could save hundreds of millions in U.S. taxes because it would move its tax headquarters from America to Ireland, where Allergan (AGN) is based. Pfizer (PFE), which currently operates out of New York, would slash its tax rate from around 25 percent this year to about 18 percent.

    Inversions have long been attacked by some politicians as a tax dodge, and Hillary Rodham Clinton and Bernie Sanders, the leading Democratic presidential contenders, criticized the deal.

    Clinton said it will leave "U.S. taxpayers holding the bag," while Sanders said it will be a "disaster" for Americans already paying high prescription drug costs.

    Asked if the deal was designed to avoid taxes, Pfizer CEO Ian Read said only that company executives' obligation is to shareholders and patients.

    The merger is subject to approval from regulators in the U.S., European Union and elsewhere. It also needs the go-ahead from shareholders of both countries.

    Pfizer makes such drugs as Viagra, cholesterol-lowering Lipitor and the clot-preventer Eliquis. Allergan produces the wrinkle treatment Botox and Restasis for dry eyes, and also has a superior pipeline of medicines in development.

    If it goes through, the merger will return Pfizer to the top spot in the pharmaceutical industry, after years in which competition from cheaper generics cut into its revenue from some of its blockbuster drugs.

    Lower Taxes

    The combination will essentially be Pfizer "but with a lower tax rate," wrote Bernstein analyst Tim Anderson.

    Despite attempts by Congress and the Treasury Department to thwart the practice, about 50 U.S. companies have inverted in the past decade, and more are considering it, according to the nonpartisan Congressional Research Service. Treasury said it had no comment Monday.

    The health care sector has been the hottest in U.S. mergers this year and last, with deals worth $451 billion, according to Dealogic.

    Drugmakers, insurers and pharmacy chains are combining to boost revenue, cut costs and increase their clout in negotiating prices and contracts. Each new deal puts pressure on smaller rivals to bulk up.

    John Colley, a professor at Warwick Business School in Britain, predicted even bigger deals as "industry players become concerned about being left behind in the race for scale."

    For consumers, however, such combinations could lead to higher drug prices, as well as higher taxes to cover the lost tax revenue, said Jerry Reisman, a New York merger expert.

    "We're all going to feel this," he said.

    The deal will enable the combined company to pour around $9 billion a year into research on new treatments, Read said in an interview. That includes work on cures for Alzheimer's disease, Parkinson's, cancer and other difficult-to-treat illnesses. It costs upwards of $1.5 billion to get a new drug approved.

    Lingering Effects

    "The impact for patients is great, both short term and long term," said Read, who will be chairman and CEO of the combined company, to be called Pfizer Plc.

    Executives wouldn't discuss any layoffs, but they are considered inevitable, given that they're predicting annual savings of about $2 billion within three years of closing the deal. Pfizer has about 95,000 employees, Allergan 15,000.

    Currently No. 2 among drugmakers globally, Pfizer posted revenue of $49.6 billion in 2014, when Allergan reported $13.1 billion. Switzerland's Novartis (NVS), the No. 1 drugmaker for the last few years, reported $58 billion in 2014 revenue.

    Several U.S. drugmakers have performed inversions through acquisitions in the past several years, including generic drugmaker Mylan (MYL). Allergan itself is the product of an inversion.

    Last year, the Treasury Department issued new regulations to curb the financial benefits of inversions. Amid political backlash over the looming Pfizer-Allergan announcement, Treasury rushed out new rules Thursday, but they focus on deals in which the overseas company's shareholders end up with 20 to 40 percent of the combined corporation.

    Under the agreement announced Monday, Allergan's shareholders will own 44 percent of the stock, and Pfizer's 56 percent.

     

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    New Car Sales
    David Zalubowski/AP
    DETROIT -- Ford is recalling nearly 452,000 midsize cars because the gas tanks potentially can leak fuel.

    The recall covers certain 2010 to 2011 Ford Fusion and Mercury Milan sedans built in Mexico from July 21, 2008 through March 4, 2011.

    Ford says a valve on a gasoline vapor recovery canister can get stuck, causing repeated air pressure changes in the gas tank. That can eventually cause a crack on top of the tank and a possible fuel leak. The company says it has no reports of fires or injuries from the problem.

    Dealers will inspect the valve and fuel tank for leaks and replace them if needed. They'll also update the powertrain control module software.

    About 411,000 of the cars are in the U.S., with nearly 34,000 in Canada and just over 7,000 in Mexico.

     

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    Shutterstock
    Plenty of stocks go up and down in any given week. The gainers inspire us to keep investing. The decliners keep greed in check while reminding us about the risks of the equity markets.

    Let's go over some of last week's best and worst performers.

    Abercrombie & Fitch (ANF) -- Up 22 percent last week

    Sometimes even a meandering specialty retailer gets a chance to shine. Abercrombie & Fitch moved higher after posting blowout quarterly results. Adjusted earnings clocked in at 48 cents a share. That may be just slightly ahead of the 42 cents a share it posted a year earlier, but analysts were holding out for net income of just 22 cents a share. Sales slipped 4 percent since the prior year to $878.6 million, but that was also enough to exceed the $863.4 million that Wall Street was forecasting.

    Things obviously aren't perfect at Abercrombie & Fitch. Comparable-store sales continue to run negative at its namesake stores, though a gain at its Hollister concept and positive results overseas helped keep the top line presentable. This is just the kind of positive momentum that a retailer likes to have as it heads into the critical holiday shopping season.

    Nuance Communications (NUAN) -- Up 21 percent last week

    Nuance may not be a household name, but odds are good that you are familiar with its handiwork. It's the leading provider of the speech-recognition software used by companies to provide customer support on automated calls. That may not be a very popular support solution, but it's good business for Nuance.

    Shares of Nuance hit a 52-week high after posting better-than-expected quarterly earnings. Deutsche Bank's analyst followed the report with a bullish note, raising his price target on the stock to $30 from $25.

    Netflix (NFLX) -- Up 19 percent last week

    The leading premium video streaming service had a strong week. It was already the top gainer for 2015 among the S&P 500 (^GSPC) companies, and it padded its lead after it debuted a new Marvel show and a report came out that shows Netflix's deep penetration in Australia.

    RBC Capital Markets also put out a favorable report after surveying 1,000 Internet users to find that more than half of them use Netflix and the vast majority indicate that they aren't likely to cancel. Given Netflix's growing digital catalog and its reasonable subscription price, that probably isn't a surprise.

    Nimble Storage (NMBL) -- Down 52 percent last week

    At least nine analysts downgraded Nimble after it reported a much wider quarterly loss than analysts were projecting. That's one way to lose more than half of your value in a single week. The provider of flash-based data storage solutions also offered up guidance for the current quarter that was well below where the pros were perched.

    Stage Stores (SSI) -- Down 26 percent last week

    It was an exit for Stage investors after the parent company of several retailers including Bealls, Goody's and its namesake chain posted disappointing financial results. Stage Stores saw its quarterly deficit double from a year earlier.

    Liquidity Services (LQDT) -- Down 19 percent last week

    Finally, we have shares of Liquidity Services losing nearly a fifth of their value after the company offered up a weak outlook for the year ahead. The provider of online surplus auction services actually has posted year-over-year declines in revenue for three straight quarters now. The market doesn't like when a company's top line is going the wrong way.

    Motley Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool owns shares of and recommends Netflix and Nuance Communications. The Motley Fool recommends Liquidity Services. Try any of our Foolish newsletter services free for 30 days. Check out our free report on one great stock to buy for 2015 and beyond.

     

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    Existing U.S. Home Sales Rise to Second-Highest Since 2007
    Daniel Acker/Bloomberg via Getty Images
    By Lucia Mutikani

    WASHINGTON -- Home resales fell in October as a persistent shortage of properties limited choice for potential buyers and pushed up prices, suggesting some softening in the pace of the housing market recovery after strong gains early this year.

    Still, housing remains on solid footing, with sales for the full year on track to be the best in eight years. That should see housing take up some of the slack from a chronically weak manufacturing sector.

    The housing market is in decent shape but could be a lot better if people decided they were ready to move and listed their homes.

    "The housing market is in decent shape but could be a lot better if people decided they were ready to move and listed their homes," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.

    The National Association of Realtors said Monday existing home sales declined 3.4 percent to an annual rate of 5.36 million units. September's sales pace was unrevised at 5.55 million units and was the second highest since 2007.

    The drop in sales was expected after contracts to purchase previously owned homes fell for two straight months. But with a tightening labor market, marked by a 5 percent unemployment rate, housing fundamentals are fairly healthy.

    In addition, the government has taken steps to ease lending standards for young adults. However, an anticipated interest rate hike next month by the Federal Reserve could make housing a bit expensive, especially if there is no significant pick-up in wage growth.

    "There is every reason to expect that the demand for homes will grind higher in the coming months. While interest rates are set to rise, so are incomes, and that will keep housing affordability historically favorable," said Matthew Pointon, property economist at Capital Economics in New York.

    The weak sales come on the heels of reports last week showing a drop in housing starts in October and a decline in confidence among homebuilders. Economists had forecast sales falling to a rate of 5.4 million units last month.

    The dollar rose to an eight-month high against a basket of currencies, while prices for U.S. government debt were up marginally. The housing index rose 0.3 percent as the shortage of houses for sale was seen boosting homebuilders such as D.R. Horton (DRI) and Lennar (LEN).

    A separate report showed Markit's Purchasing Managers Index hit a 25-month low in early November, highlighting continued weakness in the factory sector. The decline, however, brought the PMI in line with the Institute for Supply Management survey, which has a longer history of tracking the manufacturing sector.

    Pain in the West

    October home sales were up 3.9 percent from a year ago and held above their average for the year. Sales dropped 8.7 percent in the West from the prior month and fell 3.2 percent in the South. These two regions, which are experiencing strong population growth, have seen large price increases due to tight inventory.

    The supply squeeze is mostly hurting the lower end of the market, where sales have dropped sharply from a year ago.

    Last month, the number of unsold homes on the market fell 2.3 percent from September to 2.14 million units. Supply was down 4.5 percent from a year ago, a worrying sign as housing heads into a quiet season, the NAR said.

    At October's sales pace, it would take 4.8 months to clear the stock of houses on the market, up from 4.7 months in September. A six-months supply is viewed as a healthy balance between supply and demand.

    With inventories tight, the median house price increased 5.8 percent from a year ago to $219,600. October's price increase marked the 44th straight month of year-on-year gains.

    Although higher prices could sideline potential buyers, especially those wanting to purchase a home for the first time, they are boosting equity for homeowners, which could encourage them to put their homes on the market.

    Realtors and economists say insufficient equity has contributed to the tight housing inventories. Last month, the share of first-time buyers crept up from September to almost a third. But the share was still the second lowest since 1981 on an annual basis.

    "First-time home buyers continue to be crowded out by competition from investor sales. Price pressures from low inventory present another headwind to first-time buyers," said Derek Lindsey, an economist at BNP Paribas in New York.

     

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    FILE - In this Feb. 13, 2015, file photo, a forklift operator moves a pallet of goods at an Amazon.com fulfillment center in DuPont, Wash. This year, Amazon has been making an aggressive push to offer same-day delivery to its $99 annual Prime loyalty club members. Their service is now available in 750 cities and towns in 16 metro areas. And where Amazon goes, other retailers must follow. (AP Photo/Ted S. Warren, File)
    Ted. S. Warren/APA forklift operator moves a pallet of goods at an Amazon.com fulfillment center in DuPont, Wash.
    By MAE ANDERSON

    NEW YORK -- Everyone likes the idea of same-day delivery. But who wants to pay for it?

    That's the problem merchants face as the busy holiday shopping season approaches. They want to offer customers the near-instant gratification that usually only comes with shopping in stores or via apps like Uber and Seamless (GRUB). But the logistics and costs of same-day delivery -- the fuel, labor, infrastructure and other costs -- have been difficult challenges to surmount.

    This year, Amazon (AMZN) has been making an aggressive push to offer same-day delivery to people who've paid its $99 fee for Prime loyalty club membership. That service is now available in 23 metro areas. And where Amazon goes, other retailers must follow.

    "Over the past 18 to 24 months Amazon has been pushing the bar" for fast and cheap delivery, said Daphne Carmeli, CEO of Deliv, a startup that works with retailers to provide same-day delivery. "If you're in retail, you have to step up to the new bar."

    Retailers trying to compete with Amazon on the road Amazon created will always be at a disadvantage.

    Amazon, of course, doesn't have to pay for the cost of store upkeep, not counting its new bookstore in Seattle. And it makes money from other non-retail areas, such as its cloud computing arm, so it can afford to offer delivery services others can't.

    "Retailers trying to compete with Amazon on the road Amazon created will always be at a disadvantage," said shipping industry expert Satish Jindel. "There's only so long they can absorb the cost, it's a huge challenge for retailers."

    Providing hassle-free, same-day delivery has been a quixotic quest for retailers for more than a decade. During the first Internet boom, startups like Kozmo.com became ubiquitous in New York as employees with purple messenger bags fanned out to deliver snacks and household goods. But it didn't make money, went bust and became a cautionary tale for the future.

    "I remember using Kozmo.com a decade ago," said C.J. Dugan, 37, a TV producer in Chicago. "One night we ordered a tub of ice cream and the movie 'Pitch Black.' They showed up in about 30 minutes. It was before its time, I guess."

    Fifteen years later, things are definitely different. Driver routes are easier to track with smartphone GPS technology, more brick-and-mortar retailers are speeding delivery by using their stores as de facto warehouses, and more people are willing to work in an "on-demand" fashion popularized by Uber and service apps like Taskrabbit.

    So more retailers are taking on the challenge of same day. Start-up delivery service Deliv is working with Macy's (M), Kohl's (KSS), Express (EXPR), Williams-Sonoma (WSM) and other brick-and-mortar retailers to expand same-day delivery options. Macy's offers same-day delivery in 17 cities; Kohl's this month expanded same day deliveries from six to nine cities.

    Craft-selling site Etsy (ETSY) is working with Postmates for a holiday season pilot that will let some shoppers in New York City have items delivered to their door within hours for a flat fee of $20. Apple is also working with Postmates on same-day deliveries in New York and San Francisco.

    Uber is jumping into the same-day delivery game, too. In October it launched an UberRush service in New York, San Francisco and Chicago that lets small businesses offer same-day delivery. Any small business within a certain geographic range in those areas can sign up for free and offer their online customers same-day delivery for a fee. In New York, UberRush will cost users $3 to start, then $2.5 a mile with a minimum of $5. Rates vary slightly in Chicago and San Francisco.

    The holiday season will be a test for the new services. Not all businesses have found it's what their customers want.

    Last July, eBay (EBAY) shut down its eBay Now service, which it started in San Francisco in 2013 and expanded to four cities. The company said it's now testing options that are "more relevant" to its sellers.

    Rob Howard, who runs same-day delivery provider Grand Junction Inc., said eBay Now's business model, which paid drivers to enter retail stores, buy an item and deliver it, was "very high cost and unsustainable." Deliv, by contrast, works with retailers to have packages ready to go for drivers when they arrive.

    And the cost remains a sticking point. Amazon offers some same-day deliveries for free, subsidized by revenue streams elsewhere. But others charge $5 to $20, a cost that deters some users.

    "It's nice to have, if you can get it for free," said Forrester (FORR) analyst Sucharita Mulpuru, who tracks the e-commerce industry, describing the mindset for many.

    Speedy delivery could help drive customer loyalty in some cases. Dugan, the former Kozmo.com user, doesn't use one-day delivery a lot. But he recently ordered a mat for his standing work desk from Amazon Prime Now.

    "From the time I placed the order to when it arrived at our reception was just over an hour -- it was pretty awesome," he said. "I can't say I'll use the service all the time, but this was about the perfect experience when I really, really needed something."

     

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    US Markets Open For Shortened Thanksgiving Holiday Week
    Spencer Platt/Getty Images
    By Sinead Carew

    NEW YORK -- U.S. stock indexes closed slightly lower in quiet trading Monday on Wall Street after last week's strong gains, while a big health care deal failed to impress investors.

    Pfizer's (PFE) announcement of what is expected to be the biggest-ever health care deal pushed its shares down 2.6 percent making it one of the biggest drags on the S&P. Target company Allergan (AGN) closed 3.4 percent lower after the $160 billion deal announcement.

    Today was a dull day unless you're involved in Pfizer or Allergan. Away from that, it's kind of aimless.

    "Today was a dull day unless you're involved in Pfizer or Allergan. Away from that, it's kind of aimless," said Brian Fenske, head of sales trading at ITG in New York. "Nobody was panicking when the market was going lower. It wasn't really on heavy volume."

    The Dow Jones industrial average (^DJI) fell 31.13 points, or 0.2 percent, to 17,792.68, the Standard & Poor's 500 index (^GSPC) lost 2.58 points, or 0.1 percent, to 2,086.59 and the Nasdaq composite (^IXIC) dropped 2.44 points, or less than 0.1 percent, to 5,102.48.

    Disappointment in the Pfizer-Allergan deal was driven by weaker-than-hoped-for projected savings from the complex deal, antitrust issues, along with a possible delay in Pfizer's plan to split into two companies, according to analysts.

    A few days ahead of the Thanksgiving holiday, when markets are closed and traders take time off, about 6.18 billion shares changed hands on U.S. exchanges, below the 7.2 billion average for the 20 sessions, according to Reuters data.

    Unimpressive Data

    After a week when the S&P 500 had its best performance of the year, investors were unimpressed by Monday's economic data and some were concerned that economic growth may be slower than expected, said Stephen Massocca, Chief Investment Officer of Wedbush Equity Management in San Francisco.

    "We had a very large rally last week and it's not surprising to see the market correct after that," said Massocca.

    Sales of existing homes fell in October as a persistent shortage of properties limited choice for potential buyers and pushed up prices, suggesting some softening in the housing market recovery after strong gains early this year.

    A separate report showed Markit's Purchasing Managers Index hit a 25-month low in early November, highlighting continued weakness in the factory sector.

    S&P utilities were the worst performer with a 1 percent decline, followed by telecommunications services. Those sectors tend to be affected by expectations for a U.S. Federal Reserve hike in interest rates.

    The staples was the strongest, led by a 10.2 percent increase in shares of Tyson Foods (TSN) to $48.09 after its quarterly sales beat estimates.

    The energy sector rose 0.7 percent, as crude prices were volatile after Saudi Arabia agreed to cooperate with other oil producers to stabilize prices but traders worried about a global supply glut and signs of rising U.S. stockpiles.

    Advancing issues outnumbered decliners 1,581 to 1,466, for a 1.08-to-1 ratio; on the Nasdaq, 1,566 issues rose and 1,236 fell, a 1.27-to-1 ratio favoring advancers. The S&P 500 posted 25 new 52-week highs and 4 lows; the Nasdaq recorded 77 new highs and 77 lows.

    -Abhiram Nandakumar contributed reporting from Bangalore, India.

    What to watch Tuesday:
    • The Commerce Department releases its second estimate for the third-quarter gross domestic product at 8:30 a.m. Eastern time.
    • Standard & Poor's releases S&P/Case-Shiller index of home prices for September and the third quarter at 9 a.m.
    • The Conference Board releases the Consumer Confidence Index for November at 10 a.m.
    Earnings Season
    These selected companies are scheduled to report quarterly financial results.
    • Burlington Stores (BURL)
    • Campbell Soup Co. (CPB)
    • Cracker Barrel (CBRL)
    • Dollar Tree (DLTR)
    • Hewlett Packard Enterprise (HPE)
    • Hormel Foods (HRL)
    • HP Inc. (HPQ)
    • Signet Jewelers (SIG)
    • Tiffany & Co. (TIF)
    • Valspar (VAL)

     

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    Man Sitting With Laptop And Credit Card Shopping Online
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    When used properly, credit cards are extremely valuable personal finance tools. Credit cards can offer four big benefits:

    1. Responsible usage of a credit card is the easiest way to build a good credit score. Despite widespread myths, you don't need to go into debt to have a good credit score. If you use less than 10 percent of your available credit and make your payment on time and in full every month, you will build an excellent credit score over time without paying a dime of interest. Having a good score can help you get the best mortgage and auto insurance rates. In addition, credit scores are used by auto insurance companies in most states to determine your rate.

    2. Using a credit card for purchases provides you with much better fraud protection than a debit card. According to Peter Dean, the CEO of Optimizing Risk, the Fair Credit Billing Act only limits your liability to $50 if you report unauthorized use within two days. After two days, your liability increases to $600. After 60 days, you have unlimited liability. With credit cards, the liability is always capped to $50, and most credit card issuers waive that for marketing purposes.

    3. Credit card companies offer a grace period. That means you will never pay interest if you pay your statement balance on time and in full. You are effectively able to borrow money at zero percent every month.

    4. You can earn rewards or airline miles with a credit card. It is easy to find a cash back credit card that pays 2 percent unlimited cash back. But you can even find cards with better earn rates. A study by MagnifyMoney has found cards paying 3 percent or more in certain categories.

    Despite all of these benefits, credit cards can become incredibly expensive when not used properly. Here are the five biggest credit card traps to avoid.

    1. You spend more than you should. Credit card companies typically issue limits that are multiples of your monthly gross income. If you make $3,000 a month before taxes, you should not be surprised to receive a credit limit of $6,000 or more. Credit card companies just need to ensure that you can afford to pay the minimum due every month, which is typically 2 percent of the balance. With big limits, it is easy to spend more than you should. Countless studies have shown that people spend more when they use plastic instead of cash. If you don't have the self-discipline to spend only what you can afford to pay in full every month, you can end up in debt very quickly.

    2. You pay a much higher interest rate than you should. Interest rates on credit cards are not low. The average interest rate on credit cards is 14 percent, and for people with lower credit scores the rate can be much higher. Personal loans typically have much lower rates than credit cards. You can find some of the best personal loan providers at MagnifyMoney.com, and rates start as low as 4.05 percent.

    3. You use your credit card for a cash advance. A cash advance can be very expensive on a credit card. You will typically be charged a fee for the cash advance, which is usually around 5 percent (or a minimum of $10). So, if you take out $500 you would be charged $25 right away. In addition, you wouldn't earn rewards and interest accrues immediately. There is no grace period. Finally, there is a separate cash advance rate that is much higher than a purchase rate.

    4. You use your credit card for overdraft protection. Mistakes can happen, and having overdraft protection can be a useful insurance policy. However, linking your credit card can make it a very expensive insurance policy. Most banks would charge you twice. First, the checking account would charge an overdraft transfer fee of $10 to $12. Second, the credit card would charge a cash advance fee, because the overdraft would be treated as a cash advance on the credit card. That means interest would accrue, at a higher interest rate, immediately. It is far better to link a savings account for overdraft protection. Even more importantly, you should just make sure you build a buffer in your checking account. With savings account interest rates so low, you would likely be better off keeping that money in your checking account to avoid an overdraft fee, rather than earning 0.01 percent in your bank's savings account.

    5. You pay late. Late fees on credit cards can be shockingly high, typically $30 or more. And you only need to be a day late for most credit card companies to charge you the fee. The good news is that your credit score will likely not be impacted, because most credit card companies only report delinquencies after you are 30 days late. However, you will be wasting a lot of money. Just automate your monthly payment to avoid the fees. If you do become 60 days or more late, your interest rate can increase to a punitive rate, which is usually around 30 percent.

    If you are responsible, and have self-discipline, a credit card is a wonderful tool that makes it easy and safe to pay all over the world. But if you can't control your spending, a credit card can become dangerously expensive quickly. Make sure you have an honest assessment of yourself before you decide whether to swipe or carry cash.

    ​Nick Clements is co-founder of MagnifyMoney.com, a price comparison website. Previously, he was a managing director at Barclays.

     

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    Family Toasting at Thanksgiving
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    By Lou Carlozo

    For most of us, entertaining on Turkey Day means one (difficult) thing: juggling. Trying to balance the wave of relatives and friends, all while keeping a budget and loading up the sleeping bag for the Black Friday campout, is a tricky endeavor. So what can you do?

    Here, we offer our best tips for how to save on hosting the Thanksgiving meal this year, and ways to entertain without getting drained.

    Save Money (and Time) With a Potluck

    This idea depends entirely on what kind of friends and such you have: the adventurous, fun kind or those who will bang on the table like gorillas until you serve the big bird. If it's the former, put out some feelers to see how the idea of a potluck strikes them. You can make it easier for them by taking on the turkey task by yourself while others chip in on the trimmings, dessert, etc. Aside from being thrifty, this can prove incredibly festive if you and your crew would otherwise spend Thanksgiving alone, or in small pockets of two or three.

    "Potluck Thanksgiving also serves as a time-saver and allows guests to enjoy a variety of cooking styles," says Rick Castellano, a spokesman with Upromise. It's especially smart if you're a college or graduate student adult doing the hosting.

    Share the Love by Sharing Leftovers

    If you're the kind who refuses to skimp on a Thanksgiving meal, we're right there with you. But if you're also the kind who gets stuck eating turkey-topped pizza and turkey smoothies for the next three weeks, then you could certainly benefit here. "Be realistic about what you will eat at dinner and what you can consume in leftovers," says Kevin Gallegos, vice president of Phoenix operations with Freedom Financial Network. "Send some leftovers home with guests, and freeze some to enjoy later." Adds Castellano, "As tempting as it is to live off Thanksgiving leftovers for two weeks, consider giving to your local food bank."

    Focus on Food Instead of Decor

    We're not trying to yank the stuffing plate away -- just the impulse to go overboard with decorating your home for your guests. "Keep the focus on the food instead of the decorations," Gallegos advises. Here's an easy way to go cheap and classy: "Gather attractive houseplants in a large basket, bowl, or even a box decorated with fabric or paper for a centerpiece." Want to go classier still on a budget? "Small plants chosen for the occasion could be given to guests as favors when they leave."

    Fast-Forward to December Fun by Trimming the Tree

    Entertaining guests poses a challenge of extremes: Throwing the Big Game on the big screen doesn't work for those who couldn't care less about football, and hiring a string quartet is excessive, even for Donald Trump. Since most people rush by Thanksgiving to get to the December holidays anyway, give some thought to breaking out the ornaments and having everyone trim the tree (assuming you can put one up this early). It's a novel twist on a holiday pastime and much in the spirit of our next tip.

    Revive a Lost Tradition: Ye Olde Song Circle

    Think back to a time before smartwatches ... smartphones ... flat-screen TVs. Can't think back past yesterday's breakfast, eh? Well, in the days before radio, families gathered in the living room after a celebratory meal to sing holiday songs, accompanied by piano, reed organ, or the aptly named parlor guitar. Why not revive a lost custom this year?

    Tell your friends and family to bring song lyric printouts, instruments and the like. Have kazoos or something else fun on hand for those who claim a lack of musical talent. This activity is way cheap, way fun, and gets your guests to interact instead of crawling into the stale cocoon known as cable TV. How many reruns of "Seinfeld" can your posse watch anyway?

    Ditch the Paper Plates and Don't Be Afraid to Borrow

    We all want to save on time and labor on Thanksgiving, so there's the possibility of going with paper plates and cups or having food catered. One obvious savings point is to cook the meal yourself, or with help: Look for those close to you who love to help in the kitchen.

    But what if you could take what you spend on paper plates and keep it as paper cash? "If you are short on place settings, borrow -- neighbors, family, and guests usually are happy to share," Gallegos says. "Or look on Craigslist, eBay or at thrift stores for extras you can reuse throughout the year."

    Avoid Leaving Stuff to the Last Minute

    Next to cooking too much, the next greatest risk in entertaining comes when you leave everything until the last minute. As Gallegos sums it up, "If you are just days away from Thanksgiving with nothing planned, human nature says that you will be more likely to run to the store and load up on somewhat random items for your meal and day." And by not planning in advance, you make it more likely you will spend too much.

    Readers, how do you save money while hosting for big family meals like Thanksgiving? Share your tips for budgeting, and staying sane, in the comments below.

     

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    Holiday Shopping Black Friday
    J Pat Carter/AP
    Every year, savvy shoppers find deep discounts online and in stores on Black Friday. Whether they're looking for the newest, most advanced tech device or the perfect outfit for New Year's Eve, buyers know retailers will offer some of their best deals during this time.

    But are all the deals great? Do you have to shop online to find them? And do Black Friday sales even have to begin on Black Friday? We've addressed these questions, and quite a few more, in our list of the biggest myths about Black Friday. Brush up on some shopping knowledge now, so you're well prepared for the upcoming deal season.

    1. Black Friday Sales Begin on Black Friday

    Much like Christmas itself, Black Friday is now a full season. Sure, Black Friday proper is the main attraction, but stores have increasingly started to release deals in waves. Bargains can be found early in the week of Thanksgiving and run all the way through the weekend. (In fact, some of Amazon's deals have been available all week.) The bottom line is, if you're doing all your deal-hunting exclusively on Black Friday, then you're missing out.

    2. You're Missing Out if You Only Shop Online

    Companies advertise doorbusters in order to attract customers to their brick-and-mortar stores. But in recent years, as competition has escalated among rival retailers, those eye-catching deals have steadily moved online as well. In fact this year, we saw our first mobile app-only deals and perks.

    The reason is simple. Traditional retailers like Walmart, Target and Best Buy know that online retailers such as Amazon will match their best prices on in-store deals. Thus it only makes sense to offer the same deals online, to remain competitive. The goal is to beat Amazon, but the real winners are deal-hunters.

    3. Black Friday Shopping is Dangerous

    We've all seen the footage. Hordes of crazed holiday shoppers stampede into a store at four in the morning, trampling anyone and everyone in the way. It makes for a morbidly fascinating spectacle, a case study for shoppers as social Darwinists, played out on live TV.

    But the truth is that those sorts of incidents are actually extremely rare. We just happen to see the worst on the news because it translates into great TV. While you should be aware of the potential for chaos during your in-store shopping, know that it's unlikely to reach aggressive proportions.

    4. All Black Friday Deals Are Amazing

    This is shopping 101. Remember, retailers are in business to make a buck, and they can't do that if they lose money -- or even make too small a profit -- on every deal.

    Some deals are great, but others are filler. The great ones are there to lure you into buying more stuff, ideally at a healthy markup. So do your research and uncover the truth about those "rock bottom" prices before you buy.

    5. All Black Friday Deals Appear in Ads

    Nope. For one thing, websites like Amazon don't even run traditional ads. So you won't be able to scope out their deals beforehand on TV or in the newspaper. Plus, because most of the big stores want to out-do each other, there's a certain amount of responsive pricing that comes after the ads debut.

    If Walmart, for example, is offering a crazy discount on a TV, and it's getting a lot of attention for that price, then there's a good chance that its competitors will consider doing the same at the last minute.

    6. Apple's Black Friday Sale is a Must-Shop Event for Apple Fans

    Apple Stores across the country will be packed on Black Friday, but they won't be offering great deals. Last year, the tech giant offered gift cards with its full-price devices, which was pretty disappointing for shoppers hoping for a discount. If you want a real deal, you'd be better off checking out what third-party retailers such as Walmart, Best Buy and MacMall can do.

    Apple doesn't want to be known as a brand for discounts, but in the past few years, these resellers have been a lot more liberal with their Apple promos. In fact, last Black Friday, Target offered huge gift cards with every iPad model, while the MacBook Air fell to all-time low prices. Check out our roundup of the best advertised Apple device prices for more details on where to shop this year.

    7. You Have to Stay Glued to Your Computer All Day to Get Deals

    Sure, Black Friday can be stressful. With deals popping up throughout the day, you might feel like you have to keep your eyes on the computer monitor.

    But that's simply not the case. DealNews has you covered. Before you spend 24 hours staring at a pixelated screen, set up an alert with us to receive notifications when your favorite deals are posted. (Keep in mind though that once your deal of choice goes live, you will have to buy quickly.)

    8. Once You Hit "Purchase," It's Yours

    Every year, plenty of shoppers have online orders canceled for various reasons. The price listed on the website might be incorrect (it happened infamously with Best Buy in 2011), or the item might have sold out so fast that the company couldn't process all the orders before you pressed "purchase."

    On the other hand, check the fine print. If you want to back out of a buy, you might be able to cancel the order. But you might also be stuck if the merchandise is listed as "final sale."

    Just remember, with all the money changing hands, businesses tend to tighten their return policies during the holiday season. Buy wisely, and make sure to ask for gift receipts when necessary.

    9. Online Shopping is Always Easier

    As anyone who's lived through Black Friday knows, the online experience isn't always stress-free. Technology isn't perfect. Websites can crash or even fail. And when everything works properly, some deals will simply sell out before you can place your order. The latter is a common complaint for flash sales from Amazon, for example. But at least you're still shopping from home!

    10. Luxury Goods Don't Go on Sale for Black Friday

    It's true that Black Friday emphasizes lower-end electronics, however, in recent years, several luxury retailers have begun offering sales and promotions through their outlets. Stores like Last Call by Neiman Marcus, Barney's Warehouse and Saks Fifth Avenue Off 5th are a few outlets you can expect to participate in Black Friday sales. Plus, even Apple products go on sale now! (Check out our Black Friday clothing guide for more info on luxury items.)

    11. Cyber Monday Sales Are Full of Leftovers From Black Friday

    Black Friday may get all the attention, but last year Cyber Monday managed to trump Black Friday in terms of overall Editors' Choice deals (our designation for the best sales of the year, with prices we've rarely seen before). So Cyber Monday isn't a slouch, and it certainly doesn't just recirculate Black Friday castoffs. Cyber Monday is no longer a holiday you can afford to skip!

    12. Doorbusters Are Always Crappy Quality

    Bargain bin devices have a reputation for being bottom-of-the-barrel items that nobody wants, and you have to be careful for retailers trying to pass off questionable devices as "special edition." But over the past few years, the doobuster selections have been showing more flair than usual to entice customers. For example, we've seen rock-bottom prices on laptops with better-than-average specs, as well as eye-popping TV deals from brands you've actually heard of before.

    13. Black Friday is Overrated

    Sure, it's bloated. Yes, there's plenty of nonsense. And in all the chaos, some shoppers can forget that they're members of the human race. We get it. Black Friday can be crazy. But if you do your research and stick with DealNews, you can find some amazing prices out there, many of which will be the best of the year. When you know what to look for and expect, then you're less likely to get burned by Black Friday.

    14. You Should Feel Bad if You Miss Black Friday

    But, despite all the good deals we'll see during Black Friday, don't beat yourself up if you can't partake in the savings this year. The Black Friday season is special because it contains such a high level of amazing discounts in a short period of time, but we'll frequently see these promos again. They might require more patience and hawk-eyed attention throughout the year, but you can find many Black Friday prices again later if you miss out. It's just a matter of when.

    What have you learned from your experiences with Black Friday shopping? Let us know your biggest Black Friday myths in the comments.
    Holiday Shopping Tips

     

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    Multicolored lottery or bingo balls
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    By Mikey Rox

    A retirement or savings plan based on winning the lottery isn't actually a plan -- it's a wish. There are much smarter things to do with your hard earned cash. We all know this. Yet many of us still buy numbers and scratchers, for the thrill, for the dream. If you just can't resist, take a moment to slightly improve your odds. Just promise that if you win with any of these lottery hacks, you'll share your winnings with me. It's only fair.

    1. Pick your own numbers. Richard Lustig, seven-time lottery winner whose total earnings amount to more than $1 million, claims that one foolproof way to increase your chances of cashing in is to pick your own numbers rather than allowing the system do a quick pick for you. In an interview with CBS News a couple years ago, he said, "The lazy way out is to buy quick-picks. The computer picks out the numbers. Don't play quick-picks. Quick-picks are the worst thing you can do, you are playing with the worst odds."

    Instead, choose your numbers, research them to make sure they're a good set of numbers, and stick with them. But how do you know if they're 'good' numbers? By buying his book, "Learn How to Increase Your Chance of Winning the Lottery," of course. On second thought ...

    2. Stick to a regular set of numbers. Once you've found a set of 'good' numbers as determined by your research, stick to them -- and then play consistently.

    "Obviously playing regularly will boost your chances. There is no worse feeling than seeing your winning numbers on the week you forgot to buy your ticket!" suggests MSN Money.

    3. Buy more tickets, even if you have to split it. Sometimes increasing the number of tickets you purchase is cost prohibitive. In those cases, especially when massive jackpots are at stake, it may make sense to go in on a large number of tickets with a group of people, like friends, family or co-workers. Office lottery pools are quite common when lotteries reach their peak jackpots, and it's not unusual to hear about a group of coworkers winning the jackpot and thus splitting the windfall.

    4. Check your numbers religiously. How's this for a sobering statistic: About $2 billion in lottery prizes go unclaimed every year, according to CNN Money. This could be for several reasons, like players have lost their winning tickets, but most of the unclaimed money is a result of winners not checking their tickets or realizing they have a winning ticket. To avoid becoming a statistic, keep your tickets in a safe place and take them to your local lottery scanner regularly.

    5. Use the Singleton Method to win more scratch-offs. According to WikiHow, a quirk in the production of scratch-off tickets can double your chances of winning, if exploited correctly. The Singleton Method, in short, is an exercise in probability by finding sets of single numbers that only appear once on a scratch card, particularly in "match style" or" tic-tac-toe" games, in which you need three numbers in row to win. By studying this method, you can essentially eliminate those that don't fall under the winning category of the Singleton Method, and increase your chances of winning 60 to 90 percent.

    6. Use your math skills to increase your chances at powerball games. WikiHow also details how to increase your odds of winning Powerball games, but you'll need to tap into your math skills (or at least a calculator) to make a go of it. Steps include finding the expected value of the game, determining the probability of each possible "win," multiplying that probability by the payout for that win, buying tickets that increase the expected value, and looking for progressive jackpots. There's also a mention of considering the tax implications of a Powerball win, which, incidentally, can be applied to all lottery wins above $10,000.

    Do you have other tips on how to increase your chances of winning the lottery? Let me know in the comments below.

     

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    Senior woman looking horrified at computer monitor
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    By Robert McGarvey

    Three letters may spell trouble for you in the frantic shopping season that is about to explode: CNP, which stands for Card Not Present. That -- obviously -- is how online merchants process payments (unlike, say, a local pizzeria, they never see or touch the plastic). And at least some experts are predicting an explosion in CNP over the holidays.

    CNP fraud is going up three times faster than card present fraud, said Julie Conroy, a banking expert at consulting firm Aite Group.

    That was expected, kind of -- but the fast velocity of growth is much brisker than had been anticipated. And, said Conroy, expect to see still more: "We see steady growth for CNP fraud."

    The trigger event happened Oct. 1 when both merchants and card issuers were supposed to -- by edict of MasterCard (MA) and Visa (V) -- be ready for so-called EMV cards, aka chip cards. The plus of a chip card is that it dramatically cuts down on card counterfeiting. With mag stripe cards, card printers were plentiful and cheap, as was card stock. Anybody with a stolen credit card number could print out a new card and be in business thieving at a local merchant. Not so with EMV, where the chip technology introduces complexities that, so far, seem beyond the ability of crooks, certainly of run-of-the-mill criminals, to manufacture counterfeits.

    So they turn to online shopping where the chip plays no role, because -- again -- the online merchant never sees or touches the plastic.

    Just about very fraud expert had predicted a spurt in CNP fraud post Oct. 1, but Conroy is saying CNP started exploding before Oct. 1, and the theft has just kept on surging.

    She's not alone. ACI Worldwide, a global provider of electronic payment and banking solutions, has said its data show a 28 percent spike in card not present fraud, which ACI attributes to the deployment of EMV.

    Branden Williams, a vice president at large credit card processor First Data (FDC), said there's worse to come. According to him, First Data expects the real explosion of CNP fraud to happen next holiday season, not this one. That's because for now criminals have plenty of retailers that aren't yet EMV compliant (he estimated that maybe 80 percent of terminals aren't).

    Even so, Alisdair Faulkner, chief product officer at security company ThreatMetrix, predicted: "We expect to see a dramatic spike in CNP over the holiday season. For many retailers a large amount of profits come in a short period. Businesses find it hard to scale fraud detection systems."

    The crook's hope: his stolen credit card will escape notice in an avalanche of credit cards used, say, on Black Friday.

    Multiple experts also said they believed the top online retailers -- think Amazon (AMZN) -- are well prepared for the surge in CNP fraud attempts. But small- and mid-sized online retailers, not so much. Crooks may find the going easy with the smaller fry.

    Understand: this puts you in the crosshairs. Thieves have at their disposal hundreds of millions of stolen credit card numbers -- from Target (TGT), HomeDepot (HD) and other breaches -- and they are putting those numbers to use making Card Not Present purchases online. Yes, you are protected against loss, especially with credit cards (protections are weaker for debit cards), but you have to notice a fraudulent transaction and report it. This is no time to get negligent about reading credit and debit card statements. Double down on that chore, because the criminals are doubling down on their thieving.

    Is there more you can do? Said Chris Strand, an EMV expert with security firm Bit9+Carbon Black: "It's up to us to be proactive. The bank may or may not be. We can take control."

    How? Jim Wang, who blogs at WalletHacks, offered a clever tactic. He gets instant notification from a credit card whenever a CNP transaction occurs. He said American Express (AXP) offers that. "For other cards that don't offer CNP alerts, I turn on security alerts via email for transactions over $10," Wang added. "It might sound like a lot of notifications but the emails arrive shortly after the transaction, so I always remember the purchase that triggered it."

    Isn't that a lot of work? It is. But know this: trying to clean up credit trashed by identify theft criminals is a lot more work. More advice -- a labor-saving tip from multiple experts -- is save time in the holiday season by using just one credit card for the bulk of our purchases. That makes it all the easier to stay on top of what's happening inside your credit.

    This article is commentary by an independent contributor.

     

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