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On money
© St. Petersburg Times Do you find bill paying a pain? If the problem is paperwork rather than lack of funds, putting some regular payments on automatic pilot can lighten the load. Just don't forget to check your bank statements every now and then. The St. Petersburg Times recently reported the complaint of a reader who discovered she was still being debited for health club dues eight years after she thought the contract had ended. The three most popular forms of automatic payments are credit card charges, bank account drafts and payroll deduction. Instead of writing a check, you give select creditors permission to take what's due. About 69 percent of consumers paid some recurring bill automatically in 2000, double the percentage just three years earlier, according to research by MasterCard International (which has a vested interest in increasing credit card usage). The bills most likely to be put on automatic are those for Internet access, newspaper and magazine subscriptions and telecommunications services. Health club memberships also are big. The hot growth areas include insurance, cable television service and gas and electric utilities. I have had good experiences involving a mortgage, long-distance phone service, YMCA dues and automatic purchases of a mutual fund, as well as the usual payroll deductions for health insurance, retirement savings and United Way contributions. In the Tampa Bay area, many utilities offer automatic bank account debits, but most are not set up to handle recurring payments billed to credit cards. In fact, paying by credit card even on a one-time basis may entail an extra fee. For consumers the main advantage of automatic bill payment is convenience. Bills get paid even when you are on vacation. You also avoid late fees, save on postage and in some cases get a discount. The biggest drawback is the possibility of an unpleasant surprise if a variable bill turns out to be bigger than your bank account can handle. That may make overdraft protection worthwhile. Naturally, you want to limit automatic payments to companies you trust to get them right. But potential for error still exists, just as it does with bills paid by check. If you spot a mistake, you have 15 days from the day the statement was sent to notify the bank. Stopping automatic payments requires at least three days' notice. Q. I'm a snowbird who winters in Florida. My broker back home in Canada just told me that he could not re-invest some money for us because the Florida government has decreed that he needs a Florida broker's license to do this. In the meantime, our funds sit in an account paying a paltry 1 percent interest. All our investments are of Canadian origin and held in Canada. How can the state of Florida dictate to a Canadian entity how they transact business in their own country? A: If you were in Canada, the state of Florida would have no say in the matter, but since you are in Florida, the state is looking out for your interests whether you like it or not. Florida law says no one can sell securities to "persons in this state" without being properly registered. The definition of "persons in this state" includes snowbirds like you as well as people who are just here on vacation. Of course it's a little difficult to catch people on the beach using their cell phones to contact brokers back north. The law specifically addresses Canadian brokers whose Florida customers are all Canadians. They have separate registration requirements designed just for them. The law is not new, but perhaps your broker was not aware of it in the past. Q. My husband died in 2001, and I heard that I may be able to file my income tax return as a widow. What are the advantages and what do you have to do to qualify? A: If you qualify, the big advantage is that you can use the tax rate schedule and the standard deduction for a married couple filing jointly. This benefit is available for two years following a spouse's year of death, which for 2002 returns means spouses who died in 2000 or 2001. Unfortunately, most older widows and widowers do not qualify. The biggest hurdle is that you must have a dependent child living with you. In addition, you must not have remarried before the end of last year, you must have paid more than half the cost of maintaining your home, and you must have been entitled to file a joint return with your spouse when he or she was alive. -- Helen Huntley writes about investing and markets for the Times. If you have a question about investments or personal finance, send it to On Money. We'll try to answer those we think are of greatest reader interest. All questions must be submitted in writing, but readers' names will not be published. Send questions to Helen Huntley, Times, P.O. Box 1121, St. Petersburg, FL 33731.
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