what would you do if suddenly you had money just falling out of the sky into your life? would you know how to handle it? how would you be able to preserve that dough and make it grow over a lifetime? well, believe it or not, that's the challenge a lot of professional athletes face. wait 'til you watch their stories in this half-hour. ever since i can remember, i've been fascinated with moveny, making it, saving it, studying it. by the time i was 31, i'd earned enough to retire. so i embarked on a new mission -- helping you take care of your money, so you can save

more, spend less and avoid getting ripped off. >> now from his yad yoe studio, your money expert, clark howard. >> are you happy? are you really happy? have you heard of the well-being index? this is an organization that tracks how happy or unhappy, how well we're living in all different categories. they just surveyed over 100,000 people to see what makes you the most happy at work. and i got to tell you, i'm jazzed about what does make people the happiest. it's being your own boss. being an entrepreneur. and you know, during a recession, and i know the economists are starting to say we're not in one, they should go visit an unemployment office. for people looking for work, many times you're just meeting a closed door. but maybe you should open a door and start your own business. it doesn't seem to matter what your level of education is, what your training, what your

background, working for yourself as an entrepreneur tends to make you the happiest. you know what, if nobody wants to hire you, maybe it's time for you to hire yourself. and now it's time to talk about your wallet. what questions do you have for me? brett, you're moving? >> caller: possibly. my wife is actually being offered a position in a new city. and her company is asking us to come to them with basically a proposition as to what would make it work. and just wanted to ask what kind of a relocation package is typical. what should we ask for and to realize that we'll probably be losing a good chunk of change on our house sale here. >> let's take those things in reverse order then. because the greatest loss you could suffer is not the cost of either hiring a truck and moving

your own things or hiring a moving company and moving. the greatest loss you could suffer is on your home. >> caller: right. >> so, in my book, although if we were back prerecession, i would talk about how relo packages work and what's reasonable to expect. but today, because of the housing stuff, asking for what's known as a stop-loss on the sale of your home is the one simple thing i would ask for. >> caller: okay. >> and you would say to them, okay, we owe x numb of dollars on our house. current market value -- how close are you, would you guess current market value your mortgage is? >> caller: probably 180, 190. >> and how much do you owe? >> caller: we owe 180. we could walk away even. >> all right. what you could ask for, they're

not going to want an open-ended risk. you could say, will you share a loss with us on the sale of our home, up to $10,000. if you don't lose money on the sale of your home, then it doesn't cost them anything. but the max it would cost her new and potential employer, potentially $10,000. let's say you end up selling your house for $40,000 less than your mortgage, the worst possible scenario. they're out ten, but you're out 30. but it needs to be a shared sacrifice with them. tom is with us. >> caller: what i called about was, we have let ourselves get our credit card a little out of hand. >> how out of hand is a little? >> caller: well i guess a lot out of hand. like $40,000 of credit card

debt. >> and you're laughing, that sounds like a lot. what kind of income do you have? >> caller: we have about $100,000 of income. >> did this debt occur because of one particular incident in your life? like a medical problem or a business failure or something like that? or was it just steady as you go, it just kept building? >> it's mainly due to a daughter that is in her last -- well she's now she's in her last year of college. yeah. >> so it was a one-time event. in this case, not a disaster, but actually somebody who will have a return on investment, we hope, and that's a college degree. >> we hope, yes. >> so in this category, it means it's more like a student loan, than it is a traditional credit card debt. >> caller: right. >> that makes it easier for you to tackle. because it means that you and

your wife don't have an underlying financial problem with how you handle money. >> caller: that's correct. >> you were actually making an investment in the future. what i would recommend in this case, i think you're an ideal candidate to go sit down with a counselor at consumer credit counseling service or national foundation for credit counseling, whatever it's called in your area. sit down with a counselor for free, they will help you come up with a budget that you on your own can take this 40 to zero. and i bet based on your income, that you can do that over four or five years. without any intervention from anybody other than help with budgeting. but if the counselor, after looking at all your finances and obligations disagrees, they can potentially negotiate with what's known as a debt management plan for you with the credit card companies. >> next on clark howard -- >> i had hoped to retire around 60, 62, but it looks like i'm

going to be doing it until 70, 75. >> what's your current interest rate on the six-year loan? >> it's 22%. >> it's what? 22%? 22%! >> caller: yeah, that's why 6% is great.

diego, you have a question about an outstanding loan on a car. >> caller: yeah. i bought a car about two years back. and i took out a loan on it. it's a six-year loan. >> a six-year loan? >> caller: yes, six years. >> diego, first conversation we need to have, the longest car loan that makes financial sense in terms of what happens with

your wallet over time -- is 42 months. so in the next car, much shorter loan, if the payment is outrageous, it means you need to buy a cheaper car. i digress, you're two years in and you have a question for me about it. >> caller: i got a credit union account. >> good job. >> caller: i've had it for about six months and out of curiosity, i went in there and seen if they would refinance the vehicle and they said they would. at 6% interest, for five years. but they'll only finance the blue book for the car. >> caller: right, they don't want to be upside-down in that thing. so they want you to come up with the money to make that not upside-down. >> caller: exactly. >> what if we talked about you going into a four-year loan, would they give you a better rate? >> caller: i'm not sure.

>> i would ask that question. because i don't want you to then take a six-year loan and through the refi, make it a seven-year. i would rather you at least keep it at six or maybe go oh, if you did the refi for 3 1/2 years. what is your current interest rate on the six-year loan. >> caller: on the six-year, it's 22%. >> it's what? 22%! 22%! >> caller: yeah, that's why 6% is great. >> 22%? >> caller: yeah. >> do you realize how you got ripped off on that loan two years ago? diego -- wow. okay. so get in there, see what they'll rate you on a four-year. but obviously i understand why you're thrilled with 6%. >> caller: yes. >> wow, you're going to save a fortune. >> do you have a question about your wallet for me? it's so easy to ask.

just go to cnn.com/clarkhoward and click on video submission and let me know what you need to know about your wallet. just like kirk has done. >> hi, i'm kirk and i need a money coach. things that's happened with my 401(k) just make me sick. i've lost one-third of my proceeds that i worked hard to put in there. i'm definitely concerned i'm not going to have enough for retirement. because i see the way the economy is going and i don't think that social security is going to be there. my contributions to my 401(k) are about $3,000 a year and don't feel that that's going to suffice me. i had hoped to retire around 60, 62. but it looks like i'm going to be doing it until 70, 75. >> my question is, do i keep continuing to put money into the 401(k) or do i diversify and put it into something like gold, silver, real estate? >> kirk, i feel your pain because just about all of us saw

our 401(k)s get eaten up by the stock market decline. on the good side of the ledger, there has been some recovery. and second, you've got to go all the way back to the 1930s, to find a drop this fast and this rotten in the stock market. i still believe in stock market investing. you are approaching a point, though, that if you do intend to retire, you're going to have to do something. and that is, you're going to have to increase the amount of money you save, whether you choose to tut p in real estate, or in a 401(k), in gold, in whatever. the amount of savings you got to generate per month has got to go up. so you can boost how much money you'll have to live on later in life. now, to the question i'm asked a lot -- if you're burnt out by a stock market and you really feel like it ate you up, what is it you can do? gold? that can be a small amount of what you do.

but don't be dazzled by the run-up that gold had recently. second, real estate, a great opportunity. very different than stock market investing. but i do believe in real estate for the long haul, as an investor of rental properties. so if you want to diversify away, fine. most important thing, though, is save, save, save. >> next on clark howard? >> we definitely always try to save. i think you've always got to be prepared for the worst. >> they then purposely messed up your computer and then held your computer hostage and wanted you to buy your computer back from them. they kidnapped your computer. >> caller: right. >> catch that and more this sunday at 4:00 p.m. on clark howard.

>> dave, how can i be of service to you? >> caller: i'm in market for the home. in the particular area that we're searching, there's no shortage the properties. i'm very familiar with the area. and as a result. i haven't felt the need for a services of an agent at this point. i'm wondering if it's customary, or possible to expect that if

there's a gap in the asking price versus what i'm prepared to offer, if agents would be known to make a deal with the seller to come down on the commission, after the fact? is that something that's -- >> not after the fact, but as part of the negotiations. let's say, let's say the listing agent has a listing agreement at 6%. just for argument's sake. and you're coming there with no agent, they have to co-opt with. where normally they would get somewhere, defending on the real estate market, it's not quite 3-3, but it would be a shared commission. it would be completely customary that there would be some sharing in the savings by you and the seller. but what you're asking is correct. because that agent is likely to make a higher commission than he or she would have, if you were represented and you as a buyer get a little bit better deal,

the seller gets more money at the closing table. it is really a win on all three parties' parts. i would call somebody who you might think of using as your representative, as an agent. and say -- convince me why is it that it would be worth me hiring you. and the advantage, you know the area, but the gotchas could involve things that you might not normally be aware of. like what's the frequency of termites being a problem. who usually pays for this expense or that expense. what things should you be asking for that you might not think of, that are things that you should expect of the seller to provide you. and maybe they'll convince you that you do need them. or maybe you'll say, you'll feel much more comfortable, hey, i can go as lone ranger and do this on my own. professional athletes make more money than almost any of us.

but you know, they didn't start out that way. what's it like for an athlete to go from making well, everyday people money, to huge money? i talked to three players with the atlanta braves to find out what kind of challenges they faced. >> it was a tough upcoming. i was married. and so my wife is a dean's list student and she's working odd jobs, cash registers with high school girls and stuff like that, while i was playing in the minor leagues, to make ends meet. >> it must be so weird to go from skrimping every dollar to making a big bank every weekend. >> we had disposable razors in the locker room. we were at walmart and i wanted to buy some mach 3 razor blades and i remember we didn't have money in our accounts when i swiped my debit card. and when i got up to the major leagues, they had mach 3 razor

blades in the locker rooms. we actually were able to save money while we were in the minor leagues. we both have very financially responsible parents and they taught us to save, no matter what you make, live under it. >> most players, as you know, they get these big checks. and somehow they all evaporate. and i hear from you, i can see it, you're not going to do any of that. >> no, i'm saving one day for my kids and my grandkids. and that's the part of life that's going to thrill me the most. is down the road. >> isn't that cool? >> it's awesome. >> how many kids do you have? >> i don't have any yet. i'm planning for the future. >> i don't care what profession you're in, you get a raise, you get a pay increase, a lot of people like to go buy things. so me and my wife, jessica. we have two kids now. we realized the most important thing is their future. we definitely always try to save. we definitely have never lived out of our means. you've always got to be prepared

for the worst. being up and down, i'm always prepared, if i get sent down tomorrow, i've got to be prepared for that. so that's something that i'm always prepared for. >> in the next half hour, what these players know about their own money and ha kind of questions they have. you'll be amazed, you'll be able to relate to some of them in your own life. okay. i've got a special warning for you, if you own your own business. criminals have been frustrated a lot trying to crack the computers at big companies. why? because usually big companies will have their own i.t. departments, only security personnel on staff. in a small business, you're thinly staffed. but you might have a lot of money running through your accounts. especially on payroll days so what criminals are doing, is they're attacking the computer systems of small businesses, with what are known as trojan programs. that they load on to your computer, they're able to access your bank and brokerage account

passwords. and then at key moments, when you tend to have high balances? they go in and swoop in, take over your accounts and run off with the money. "u.s.a. today" had a great suggestion for small businesses. buy a new computer that you use only for banking and financial websites, that you never use for anything else. >> next on clark howard -- >> what you're describing is the first time i ever recall a call where somebody said, oh, there's a windshield chip here and they charge you for a whole new windshield. that's new territory.

unfortunately, there are people out there who want to take advantage of senior citizens. if you have parents, i want you to protect them. and in this half hour, you're going to learn about ways that people might try to rip them off. you give me this half hour, you're going to be so much smarter about your wallet, you can't stand it. ever since i can remember, i've been fascinated by money, making it, saving it, studying it. by the time i was 31, i'd earned enough to retire. so i embarked on a new mission, helping you take care of your money. so you can save more, spend less and avoid getting ripped off. >> now from his radio studio,

your money expert, clark howard. >> i've had some issues in the past with people who have tried to steal my identity. and so what i did is i went through a process known as freezing my credit. where even if somebody steals my information, they really can't do much with it. but there's some hassles involved with freezing credit. and a real question -- how much risk are you actually under for somebody stealing your identity? well you know, for a lot of us, we don't have big risk factors. how would you know, though, whether you are at great risk or not? well, there's a new website you can go to, to figure out what your risk score is. your risk assessment. you put in some personal information and then by choice, you can either include your social security number or not. and then you'll get a number back, that runs from 1-999. my number was nearly 500, which still put me in a fairly low risk category.

but you want to know where you rank. how do you do this? go to myidscore.com. possible in your information and you'll instantly have your answer. answers, that's my game. you got a question for me? fire away. tell me how i can be of sfs to you, jared? >> caller: i sold my house two years ago. sold the house upside-down. i was requested to short sell, but they didn't short-sell it to me. it was about $25,000 upside-down. they said, we're not going to short-sell it to you. but we will finance the money to you. i'm trying to negotiate myself because it's a nonsecured amount of money. i'm trying to negotiate a cash settlement with them. and it's $24,000 now, i've offered them an $8,000 cash settlement. and they came back and said, we'll knock off 25%, so we'll take an $18,000 settlement.

i'm not too terribly satisfied with that. >> it's a horse-trading mode you're in. that thur looking to get monthny payments that they may or may not ever get for years down the road. or they can get a certain amount of cash up front. so they, you made an offer to pay 33 cents on the dollar. they came back and said they want 75 cents on the dollar. now you should come back with another counter. >> my question, when i talked to her, she didn't really sound like there was any room for a counter-offer. i guess my question is i'd be willing to go down and tell her i'm having a hardship and make a payment, i'm willing to take a credit hit for a couple of months if i could save myself $5,000 or $6,000. >> well it might. there's the possibility if they're facing a write-off. they may at that point be

willing to negotiate a much more favorable deal with you. you do know you'll owe tax on whatever they agree to write off. >> caller: yeah, i'm willing to make that sacrifice, absolutely. >> make another offer. and see just because you've been told it's 18 or nothing, you say, well then how about nothing. i'll just stop paying. this is a situation where you can choose to flex your muscles as much or as little as you want. but just as in any game of chicken, you be careful how far you push this thing. amy, i have not heard from someone who took out an hsa and probably more than a year. are you self-employed? >> caller: well, my husband is. >> and that is such a wonderful choice for self-employed individual or couple or family. >> caller: well that's great to hear. i feel like from what i've heard from you and what i'm hearing, it is a good thing.

but i'm also feeling like i need a better understanding of how to imagine it and use it. >> hit me with some questions and let's see how well or poorly i can answer them. >> caller: i think one of the main things i need to figure out is really, how much should we be contributing each year to it. >> a ton to your tax-free savings account. first, let me do a quick primer for people. hsa, health savings account, is a combination of a high-deductible health insurance plan. coupled with a tax-free savings account to pay for medical. but even better, than the fact that it's tax-free, your husband, because he's self-employed, gets a triple tax benefit from doing an hsa. and wait, there's more. if your husband is making, and you combined with him are making big money, then it is to your advantage to allow the hsa money

to continue to grow tax-free. if you can afford to pay for routine visits and all that. you would normally draw from your savings account to pay them out of money you just have. >> so don't use it if you don't have to? >> right. >> caller: so if you never, if you don't have anything catastrophic or any major need for that money down the road, what happens to it? >> well that is a great question. what happens is that it can transition into money that when you're in retirement, you're going to have more medical expenses. and then it becomes for the portion of medical bills that are yours, if we have a medicare system by the the time you would retire or whatever it is at that time, it then transitions to be money to pay what would be your out of pockets at that time of your life. again, tax-free. >> next, on clark howard. >> the main disagreement point

is that overall, sarah is a spender and i'm a saver. so we want to make sure we strike the right balance. >> what is it that this investment advisor is recommending to your mom? >> variable annuity. >> what? what? are you serious! >> caller: yes. >> no, no, no, no!

>> arthur is with us, hi, arthur. how are you doing? >> caller: i'm doing well,

clark. >> so, you're watching out for your mom. that's a good son, watching out for her. >> caller: thank you, i'm trying to. she has subsequent to the death of my father, is taking care of her financial matters. and -- >> well, first i'm sorry about the loss of your dad. >> caller: well thank you. and an investment advisor recommended an investment product to her that i'm somewhat skeptical of. >> did you tell me how old your mom is? >> caller: she's 72. >> and what is it that this investment advisor is recommending to your mom. >> caller: a variable annuity. >> what! what! are you serious? >> yes. >> no, no, no, no! that is wrong! i don't know if that individual investment advisor is just

misguided or is a dishonest individual. but there is absolutely never a circumstance -- never! where a variable annuity would be proper for someone in her 70s. variable annuity is a type of insurance product that has massive commissions, and massive ongoing expenses. and huge, what are known as surrender charges. the idea at 72, normally your mom is not looking for something that might generate income for her at 100, your mom is looking for something that will cover her needs for the remainder of her lifetime. >> caller: well is this advice so egregiously bad, that we would take our business elsewhere? >> i would consider that. because it is -- there's not even a reasonable difference of opinion on this. flat-out bad, rotten, terrible,

crooked advice. it's time for money coach. that's where you get to pose your financial situation to me. and find out what i think is best for you to do. and right now, we're going to visit with ben and sarah, and hear their story and get their question. >> hi, my name is sarah. >> and my name is ben. and we need a money coach. in the last year we got married, we bought a house, sarah started school. i got done school, and started a new job. >> since we got married, we've been in super-save mode. everything that we can put away, we have put away. and now we're not sure what we should be doing. we track all of our expenses that are going out. and all the additional things that we want to do. >> i want to get to the point so that we're making our money work for us and making sure that we're just doing everything as efficiently as possible to make sure that we're living comfortable in the future.

our question is, how much should we be saving and where should we be investing that money? >> first, i got to tell you how neat i think it is that you're already in a mode that you're tracking your spending, watching where your money goes. that's the first step to really getting to your goals. but -- you've got something you got to deal with first. enormous amounts of student loans. many carrying a pretty significant interest rate. so where normally i would be having you pound away at putting money aside for retirement, because the earlier you do it, the younger you are, the more you can save -- in your case, your first priority is to pay those student loans. now how do you do that? well what i recommend is you pay as much as you can towards the highest interest rate student loan. and pay, well, just minimums against the others. for the retirement thing, you still want to start saving some for retirement. i have a solution i think works for you and works for others.

you know, in this dilemma you have, where you have debt in your life, but at the same time, you know you need to save for retirement, my best answer is the 50-50 solution. and that is, for every dollar that you can put aside, take 50 cents of it and put it towards the outstanding debt. the other 50 cents toward retirement. especially if you have an offer of a 401(k) plan at work, where there's a company match? you always want to put in at least to the company match. because, that's free money. >> next on clark howard -- >> the key is, what are you paying right now as an interest rate. because that's really what makes the decision. >> we're in the high 6s, i think. >> high 6s! >> high's something about the hybrid. the math for the first time in forever shows that buying a hybrid actually will pay off.

hi, mary, how are you? >> caller: hi, i'm doing good,

clark, how are you? >> great, thank you. you have just the nicest banks that you have your credit cards with. >> caller: yes, one of your favorite giant monster megabank. >> what has the bank done to you? >> well they increased my interest rate on my credit card. >> from what to what? >> caller: from 11.99, now it's 15.99. >> are you running a balance on this 16% card? >> yes. i'm desperately trying to pay it off. it's about $5,000. >> okay. >> caller: what i'm wondering is now that they've increased my interest rates, i see that about $60 of everything i pay is going to finance charges. >> all right, now here's a question for you. were you given an option to reject the interest rate increase? >> caller: i do not recall seeing that. >> how long has it been? >> caller: i just noticed it on this statement that i received. >> so they may have given you

notice prior month or two months ago and you just noticed the rate was higher? >> caller: they might have, yeah. >> so this $5,000 balance -- do you have funds in savings or is there any, do you have any source of cash you could use just to tell them to get lost? >> caller: well, about $2,000. >> well 37 at the very least, wipe out your savings account. and i know that sounds weird. but on your savings you're earning maybe 1%, if. versus paying interest of 16%. i would take that $2,000, put it towards the credit card. then you can, the same payment that you send each month will have a much greater impact. and are you a member of a credit union? >> caller: yes, i am. >> go see if your credit union offer as better deal on a credit card, that you can move it from the giant monster megabank to the credit union. that seems to be working really well for people right now. no matter how much money you

make, knowing what to do with it is key. and if you make huge bucks, you might not know. well, i recently visited with some members of the atlanta braves baseball team, and they had some questions for me, as their money coach. so you know the stories of all the big-time athletes who finish their career and they end up bankrupt. that's not going to happen to you, is it? >> it's a big stat and it looms. it is, it is weird. i made more money than i ever thought i would make in this game. it looms in your head. you go, wait a minute, i thought when i made a million dollars i thought i would be set for life. and when you look at your bank account, there's a lot less there than i would think. at 31, you never know what's going to happen next year. so i'm not guaranteed a job anywhere next year. we're going to have enough money to pay off our house. but we don't know whether to pay it off and have no house payment the rest of our lives hopefully. obviously property tax and

stuff. or to stay liquid. or a combination thereof and just get a very manageable mortgage payment. we don't know what to do. >> well the key is what are you paying right now as an interest rate, because that's what makes >> hi 6s? >> high 6s? >> it's an interest-only loan. >> pay it off. pay it off. don't even have to play with that question. wow. if you told me you were sitting in 4.5%, 4.25%, the great rates people got earlier this year, you'd be in the cat bird seat, you'd sit there and pay it as agreed over the years. 6 point whatever, bail out. >> thank you very much. >> appreciate it. >> what's going on with your wallet? >> everything is good. i have a question about investing. in this tough economy, what are some things that i can do to -- for the long run as far as save

money. >> the thing is you're young, you'll have a playing career that will end much younger than most people's work lives end for what you do right now. so you have to invest far more money every year than other people. and you do the same kind of portfolio as someone else, but the amount of your pay that has to go in has to be a much, much, much higher percent where a typical person will be 10% of their pay through their lifetime. what percent do you think you should be saving? >> right now? it's a good question. a lot -- >> believe it or not, it should be half of your take-home pay. more specifically, i would take half of your savings and put them in tax-free municipal bonds. intermediate length. 7 to 11 years. then the other half, i would diversify. international -- this is something that scares people.

half of your stock-based portfolio overseas, and the other half domestic. >> wow, okay. good deal. next on "clark howard". >> not just players in a ballpark. they had money questions for me. so do the fans. =