what would you do if you would you know how to handle it? believe it or not, that's a challenge a lot of professional athletes face. wait till you watch their stories in this half hour. ever since i can remember, i've been fascinating with making money. making it, saving it, studying it. by the time i was 31, i had 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. >> are you happy? i mean it. are you really happy? are you really happy? have you heard of the wellbeing index? this is an organization that tracks how happy or unhappy, how well we're living in all different categories. well, they just surveyed over 100,000 people to see what makes you the most happy at work. and i've got to tell you, i'm jazzed about what does make people the happiest. it's about being your own boss, being an entrepreneur. and i know the economists are starting to say we are not in a recession but they should look at the number of people looking for work. many of times you're just meeting a closed door. but maybe you should open a door and start your own business. 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? brad, you're moving? >> caller: possibly. possibly. my wife is 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 i just wanted to ask what kind of relocation package is typical, should we ask for. and realize we'll probably be losing a good chunk of change on our house sale here. >> all right. well, let's take those things in reverse order, then. >> caller: okay.

>> because the greatest lost you could suffer is not the cost of either hiring a truck or moving your own things or hire iing a moving company and moving the greatest loss could you suffer is on your home. >> caller: right. >> so in my book, although if we were back prerecession, i should talk about how relocation packages work but today, because asking for what is known as a stop loss on the sale of your home is the one simple thing i would ask for. and you would say to them, okay, we owe x number of dollars on our house. current market value, how close are you -- would you guess the current market value your mortgage is? >> caller: probably 180, 190. >> and how much do you owe?

>> caller: we owe right around 180. so we could walk away even. >> so what you could ask for, because they are not going to want an open-ended risk. they could say, would you share a loss for 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 for new and potential employer would be 10 grand. let's say you end up not being able to sell your house for $40,000 less than the mortgage. let's say it was the worst possible scenario. >> caller: sure. >> then they're out ten, but you're out 30. >> caller: you had had you. >> but it needs to be a shared sacrifice. >> tom is with us. >> caller: i have called because we have let ourselves get our credit cards 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? >> caller: it's mainly due to a daughter that is in her last -- well, now she's in her last year of college. >> okay. >> caller: yeah. >> so, it was a one-time event in this case, not a disaster but actually something that you'll have a return on an investment, we hope. >> caller: we hope. >> and that's a college degree? >> caller: we hope, yeah. >> so in this category it means that it's more like a student loan than it is a traditional credit card debt.

>> caller: right. >> that means that you and your wife don't have an underlying financial problem with how you handle money? >> caller: that's correct. >> and 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 the consumer credit counseling service, 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 from 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 except had help with budgeting. but they can potentially negotiate a debt management plan for you with the credit card companies. next on clark howard -- >> i hoped to retire around 60, 65, but it looks like i'll be

doing it till 70, maybe 75. >> what is your current on the six-year loan? >> it's 22%. >> it's what? 22%? >> 22%. >> 22%! >> yeah, that's why 6% is great.

you have a question about an outstanding loan on a car? >> caller: yes, i bought a car and got a loan on it, obviously. it's a six-year loan. >> a six-year loan? >> caller: yeah, six years. >> diego! okay. the first conversation that 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. bhu anyway, i digress, because now you're two years in and have a question for me about it. >> caller: yes. i got a credit union account. >> okay. good job. >> caller: and i've had it for about six months now and, just out of curiosity, i went in there to see if they would refinanced the vehicle and they said they would at 6%, but they will only finance for the blue book value of the car. >> right, they don't want to be upside down so they want you to come up with the money. and would they give you a better rate? >> caller: you know, i'm not sure. >> i would ask that question because i don't want you to then take a six-year loan and then through the refi make it a seven

year. i would like if you make it six and if you did the refi for, let's say, 3 1/2 years. what is your current interest rate on the six-year loan? >> caller: it's 22%. >> it's what? 22%! >> caller: 22%. >> caller: yes, that's why 6% is great. >> 22%? >> caller: yeah. >> do you realize how you got ripped off on that loan? diego, see what they will write you on a four-year but i would understand why you're thrilled with 6%. 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. what has happened with my 401(k) makes me sick. i've lost one-third of my proceeds that i worked to put in there. i'm definitely concerned about not having enough for my retirement, because i see the way that the economy is going, and i don't think social security is going to be there. my contributions to my 401(k) is about $3,000 a year. i don't think that's going to suffice me in my retirement. i hope to retire around 60, 62, but it looks like i'll be doing it until 70, maybe 75. do i continue to put money into the 401(k) or do i diversify and put it into something else? gold, platinum, 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. now, 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 are going to have to increase the money that you save, whether you clooz to put it in real estate or in a 401(k), in gold, in whatever, the amount of savings that you've 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 the stock market, you really feel like it ate you up, what is it that you can do? gold? if you want to do gold or precious metals, that can be a small amount of what you do, but don't be dazzled by the run-up 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. if you want to diversify, fine. the most important thing, though, is save, save, save. next on "clark howard" -- >> we definitely tried to save and we definitely never lived out of our means. i think you have 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. >> caller: right. >> they kidnapped your computer. >> catch that and a lot more this sunday at 4:00 p.m. on clark howard.

>> dave, how can i be of service to you? >> i'm in the market for a home and there's no shortage of properties in the area we're searching. i'm very familiar with the area and as a result never felt the need for the services of an agent at this point. i'm wonder fg 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 -- >> well, not after the fact but as part of negotiations. let's say the listing

agent has a listing at 6%. you are coming there with no agent that they have to co-op with. where normally they would get somewhere -- depending on the real estate market, it's not quite 3-3, but it would be a share of the commission. >> caller: right. >> 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 uh-uh might not normally be aware of, like what's the frequency of termites being a problem. >> caller: right. >> who usually pays for this expense or that expense? what things should you be asking for that uh-uh might not think of that are things you should expect of the seller to provide you. and maybe they'll convince you that uh-uh do need them or maybe you'll say you feel much more comfortable, i can go as lone ranger and do this on my own. professional athletes make more than the rest of us. it didn't start out that way, so what's it like for an athlete to go from making, well, every day people money and the challenges that they've faced.

>> it's a tough -- i was married and so my wife was dean's list student, working odd jobs, cash registers with high school girls, wherever we're playing in the minor leagues, just to make ends meet. >> must be so weird to scrimping every dollar to now you're making a big, big bank every week. >> we had disposable razors, these blue cruddy things that would knick your face. i remember we didn't have money in our account when we swiped our debit card. and i got called up to the big leagues and there are mach 3 razors all over the counters in the big leagues. i did keep some home that week. >> how do you keep from blowing all your money? >> we were actually able to save money while we were in the minor leagues. we 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. i hear from you -- i see it, you're not going to do any of that. >> i'm saving one day for my d kids and grandkids and, you know, that's the part of life that's going to thrill me the most, is down the road. >> isn't that cool? >> awesome. >> how many kids do you have? >> i don't have any of that. i'm planning for the future. >> i don't care what profession you're in. if uh-uh get a raise, people like to go and buy things. we definitely always try to save and definitely never lived out of our means. you always have to be prepared for the worst. being up and down, i'm always prepared if i get sent down tomorrow, i have to be prepared for that. that's something i'm always prepared for. in the next half hour, what these players know about their own money and what kind of questions they have. you'll be amazed. you're going to 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? usually big companies have their own i.t. department, 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 dates. so what criminals are doing is attacking the computers of small businesses with programs called troenlg ann trojan programs. they're able to break in your computer. when you toned have high balances, they swoop in, take over your accounts and run off with the money. "usa today" had a great suggestion. buy a new computer 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 received a call where somebody said there's a windshield chip here and they charged 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. in this half hour, you're going to leb learn about ways 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 and studying it. by the time i was 31, i made

enough money, i embarked on a new mission, had helping you take care of your money so you can save it, avoid getting ripped off. >> your money expert, clark howard. >> i've had people trying to steal my identity and a process known as freezing my credit, where even if somebody steals my information, they can't do much with it. there are some hassles with freezing credit. the real question, how much risk are you under for someone stealing your identity? 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 is, your risk assessment. you put in personal information and, by courthouhoice, you can your social security number or not. then you get a number one to 599. i was in a fairly low risk

category. you want to know where you rank. how do you do this? go to myidscore.com. pop in your information and you'll instantly have your answer. answers, that's my game. you have a question for me? fire away. tell me how i can be of service to you, jarod. >> caller: i sold my house about two years ago and i sold the house upside down where normally it was a requested short sale. but they didn't short sale it to me. it was about $25,000 upside down. they said we're not going to short sale it to you, but we will finance that money to you. i'm trying to negotiate, an unsecured amount of money, and i'm trying to negotiate myself 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% and take an $18,000 cash settlement. and i'm not too terribly

satisfied with that. >> well, it is a horse trading mode you're in now. and they're looking at under one prospect getting monthly payments that they may or may not ever get for years down the road, or they can get a certain amount of cash upfront. so 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 come back with another counter. >> caller: my question is, when i talked to her, it sounded like she wasn't willing to take another counter. my question is, i thought i was given an opportunity and the

possibility that if they are facing the point they would be willing to negotiate it a much more favorable and whatever they agree to write off. >> yeah, i'm willing to make that sacrifice, absolutely. >> 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, 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. >> caller: uh-oh. >> are you self employed? >> caller: my husband is. >> and that is such a wonderful choice for a self-employed individual or couple or family. >> caller: that's great to hear. i feel like, from what i've heard from you and from what i'm

hearing, it is a good thing. i'm also feeling i need a better understanding of how to manage it and use it. >> hit me with some questions and see how well or poorly i can answer them. >> okay 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, a quick explanation for people. hsa 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. >> caller: okay. >> 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, that you would normally draw from your savings account to pay them out of money you just have. >> caller: really? 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 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 time you would retire or whatever it is at that time, it then transitions to be m money to pay what would be your out-of-pocket at that time of your life. again, tax free. next on "clark howard" --

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

arthur is with us. high, arthur. how are you doing? >> caller: i'm doing well. thanks, clark. >> you're watching out for your mom. >> caller: i'm trying to. >> 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. >> first, i'm sorry about the loss of your dad. >> caller: well, thank you. and an investment adviser recommended an investment product to her that i am somewhat skeptical of. >> did you tell me how old your mom is? >> caller: she's 72. >> what is this that this investment adviser is recommending to your mom? >> caller: a variable annuity. >> what? what? are you serious? >> caller: yes. >> no, no, no, no, no!

that is wrong. i don't know if that individual investment adviser 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. a variable annuity is a type of insurance product that has massive commissions and massive on dp ongoing expenses and huge, what is known as, surrender charges. the idea at 72 is that normally your mom is not looking for something that might generate an income for her at 100. your mom is looking for something that will cover her needs for the remainder of her lifetime. >> caller: this advice so egregiously bad -- >> yes.

>> caller: to take our business elsewhere? >> i would consider that. 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, bought a house. sarah started school. i got done with school and started a new job. >> we've been in super save mode, everything we can put away, we have been put away. and now we're not sure what we should be doing. we track all our expenses going out and all the additional things we want to do or know are coming up. >> i want to get to the point so

we're making our money work for us and making sure we're doing everything as efficiently as possible to make sure that we're living comfortable in the future. our question, how much should we be saving and where should we be investing that money? >> first, i've got to tell you how neat it is that you're already in a mode that you're tracking all your spending, you're watching where your money goes. that's the first step to really getting to your goals. you have something 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? what i recommend is you pay as much as you can toward 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. so, 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? that's really what makes the decision. >> we're in the high sixes, i think. >> hi sixes? here is something about the hybrid. the math, for the first time and

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 mega bank. >> what has this giant monster mega bank done to you? >> caller: well, they increased the interest on my credit cartilage. >> from what to what? >> caller: i believe it was 11.99 to now 15.99. >> are you running a balance on this 16% card? >> caller: yes. i'm definitely trying to pay it off. it's about $5,000. and what i'm wondering is that now 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 the statement that i received. >> oh, so they may have given

you notice the 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 that you could use just to tell them to get lost? >> caller: about $2,000. >> well, then, 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%. >> caller: right. >> i would take that two grand and put it towards the credit card. and then the same payment will have much bigger impact. are you a member of a credit union? >> caller: yes, i am. >> see if they offer a credit card that you could move it from the giant monster mega bank credit union. that seems to be working very well for you right now.

no matter how much money you make, knowing what to do with it is key and even if you make huge bucks, you might not know. well, i recently visited with members of the atlanta brave baseball team and they had questions for me as their money coach. you know the stories of all of the big-time athletes who finish their career and end up bankrupt. that's not going to happen to you, sf? >> it's a big stat, and it looms. it's weird. i made more money than i ever thought i would make in this game. it looms in your head. and wait a minute, when i made $1 million i thought i'd be set for life and you look in your bank account and there's a lot less there than you think. that's why we have people out there to ask questions to. >> do you have some for me? >> obviously at 31, you never know what's going to happen next year. so i'm not guaranteed a job next year. we 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, basically, obviously property taxes, or to stay liquid. so a combination there of and just get a very manageable mortgage payment. >> well, the key is, what are you paying right now as an interest rate? because that really makes the decision. >> high sixes. >> high sixes? pay it off. pay it off. pay it off. >> that's what we planned on doing. >> see, if you told me you were sitting at a 4.5, 4.75, you would be in the cat bird seat, you sit there and pay it as agreed over the years. but at six point whatever, bail out. >> thank you thu very much. >> sure. >> appreciate it. >> what's going on with your wallet? >> everything's good. got a question about investing in this rough economy. what are some things i can do to -- for the long run as far as save money? >> the thing is that, you know, you're young. you're going to have a playing

career that will end much younger than most people's lives -- their 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 pay that goes in has fob a much higher percent. typical percent would be 10% of their pay through their working lifetime. believe it or not, what percent do you think you should be saving? >> wow, right now that'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. that's like seven to 11 years, and then the other half, i would diversify international -- this is something that scare ace lot of people. i would do as much as half of

your stock base portfolio overseas and the other half domestic. >> wow, okay. good deal. next on "clark howard" -- >> it's not just players in a ballpark that have money questions for me. so do the fans.