Financial

This weekend I found out that I am a victim of identity theft. It is very unsettling, and feels like a total violation of my privacy. My girlfriend Chrissy and I were discussing the potential of me getting a new car in the next few months. I am having some repairs coming up on my current car, like the air conditioning leaking refrigerant, fixing a small oil leak and a few other little but annoying things that will add up. It would be nice to avoid those repairs and getting a new car where I don't have to worry about service for a few years. We looked around online for cars that could be interesting and I found some good deals. I started working on a budget to figure out what I could afford and Chrissy asked me what my credit score was. I had to admit to her that I had no idea. After my divorce in 2003 I took some bad hits to my credit, as I was not able to keep up with all the bills for the house by myself plus my car payment, utilities and other expenses in addition to paying child support all of the sudden. So I had been scared of even looking at my credit score. Chrissy had used Credit Karma before for herself so Sunday I started setting up a new account there. I entered my social security number, address and some other information to setup the account.  I selected a password and submitted the form. To my surprise the reply from the site said that I already had an account, but using another email address. It did not show the address in clear, it was masked so I could only see the domain (@att.net), but I have never had any address in that domain. I sat there shocked for a while and tried to think of what could be going on.  Chrissy and I talked about it and worried that it might be identity theft.  So we called a lawyer who is a relative of hers who also works in this field.  We found out quickly that the act of someone accessing my credit report without my permission is a felony at the state and federal level. If they tried to take out credit or did take out credit in my name it is another felony.  Doing these things over the computer is yet another charge. So to figure out the truth I had to make copies of my id and fill out a form that we sent through the mail to Credit Karma, to prove my identity and get access to "my" account. This will probably take a little while though.  :-( But I am furious that someone managed to find out enough about me to be able to setup an account to monitor my credit. The person must have my social security number, my date of birth and probably also my address. A lot of people have this information, actually. This article mention some ways people can get unauthorized access to someones credit report, for example a rogue employee in HR or a company or law firm otherwise allowed to…

Two separate incidents are leading me to write this blog entry. First, the way too early passing of Tim Tripcony just a few days ago, as well as as the loss of Rob Wunderlich, Jens Augustiny and Kenneth Kjærbye in just a little over a year. All of those members of the Lotus Community left us way too early. The second one is a more personal one, as I am going in for surgery in a few weeks. All surgeries carry a small risk of complications (this particular one supposedly has less than 2% mortality rate). But what this leads me is to the subject of this blog entry. Life insurance. Most of us who are employed have some kind of life insurance through our work, and perhaps like me also have an additional life insurance policy. I am sure that most of self-employed also have purchased some life insurance themselves. So we all know we need life insurance, to provide for our children and/or spouses. But what should happen with the money, in case the worst happens? In my case, I am divorced, and have a 13 year old son. Should a 13 year old inherit half a million dollar or more just like that? Or even if the child has to wait until age 18 to get the money, and it is managed by the other parent for some years, what would that lead to? I have heard stories about young adults that inherited a large sum of money after the death of a parent, bought a fast motor cycle or sports car and killed themselves within a year. Or who started using drugs/alcohol and either wasted the money on those things, or were killed by the substance abuse. I also know about women who lost their husbands, and within a few years used up all the life insurance money on houses, new cars, cosmetic surgery, all while not working. So how do you make a real impact on the life of your loved ones left behind? In my case, I am in the process of setting up a trust that will handle the investment of the money, as well as spend it in a way consistent with my wishes. The trust will handle the payouts of the child support until my son turns 18, and it will cover his college education (tuition, books, living expenses) for up to 5 years, etc. It also have all kinds of other provisions, like a cash payment to help with his wedding (only one, and after the age of 27!), matching payments to him for what he puts into a Roth IRA  every year, financial help to buy a car and a house, etc. Even little things like extra money for birthday and christmas gifts are listed there. In addition, the trustee will have some personal discretion to help out when needed, and of course any medical and educational expenses will be covered as needed. There are so many little details that one has to think about. Until my girlfriend Chrissy brought this up…