What's in Your Beef

by Gerri Willis

Before you break out the grill this Memorial Day Weekend, be sure to check your freezers!

Stores in nine states may be selling ground beef contaminated with E. coli. Earlier this week, the USDA's Food Safety and Inspection Service announced a recall of 1.8 million pounds of ground beef products.  

The USDA won't list the restaurants where people have been sickened, but did outline the stores that may have received contaminated products. 

Consumers should return or throw out meats purchased between March 31 and April 18, 2014 from the following locations:

-- Gordon Food Service Marketplace stores in Florida, Illinois, Indiana, Kentucky, Michigan, Ohio, Pennsylvania, Tennessee and Wisconsin

-- Surf N Turf Market in Sebring, Florida--Giorgio's Italian Delicatessen in Stuart, Florida

-- M Sixty Six General Store in Orleans, Michigan-- Buchtel Food Mart in Buchtel, Ohio

-- Supervalu in Beulah & New Town, North Dakota


Americans Sold on Real Estate as Best Long-Term Investment

by Gerri Willis

You don’t have to look far to find negative news on the housing market. Just this week there were headlines proclaiming that millennials had abandoned the market and may never come back. Another lamented the rising unaffordability of housing. And, yet, most Americans are ignoring the constant drumbeat of negative news about the housing market. According to a recent Gallup poll, Americans believe that real estate is the best long-term investment, even better than stocks, bonds or gold.

Frankly, having spent a lot of time writing and researching real estate, I’m not all that surprised people feel that way. That’s because housing is an arena where the individual investor really can become the expert. Unlike stocks or bonds, you can walk around a neighborhood, touch and feel the properties and really get to know your investment first hand.

Founder of the Real Deal, Amir Korangy says that if you want to invest in real estate, choosing a market you already know is critical. Korangy, who has bought and sold dozens of properties, in addition to founding the monthly real estate publication, advises getting started with a property you live in as the “safest and best investment.”

Investing in a property you intend to rent out, however, is a little more complicated. One metric professional investors use to compare deals when shopping for an investment  is the “cap rate,” or capitalization rate, which is simply the net annual operating income divided by the sale price. “As a general rule of thumb, the lower the cap rate, the better the deal for seller. The higher the cap rate, the better the deal for the buyer,” Korangy says.

Don’t stop your research there. He says investors need to investigate the property’s condition, income trends, and the neighborhood’s condition. As with any investment, it’s important to do your due diligence.


Don’t miss our User’s Guide to Spring Real Estate 5pmET on FOX Business

How to Choose a Home Renovation

by Gerri Willis

Flipping homes is back! After a long hiatus, it is again popular in some markets to buy homes, spruce them up and sell for a profit, a topic we are covering in today's User's Guide to Spring Real Estate. Flippers know something home owners may not -- renovations can boost property values. But it can't be just any remodel.

Remodeling Magazine's annual cost versus value survey, is a great way to figure out which remodel projects have the best return on investment and what the average price is that you'll pay to get the work done.

And, there are some surprises this year. The highest return on investment for a mid-range project is switching out your entry door for a steel replacement. That job returned 97 percent of consumers' average investment of $1,162. No. 2 was the wood deck addition, which returned 87 percent of the $9,539 investment. Also scoring high on the mid-range list were attic bedrooms, garage door replacements and minor kitchen remodels.

If you're willing to pony up more dough for a luxury project, the best ROI replacing old-fashioned wood siding with fiber-cement siding. Cost is estimated at $13,378, and the return on investment is 87 percent. A foam-backed siding replacement gets less, 78 percent on the $14,236 investment. Also big on the luxury list: garage door and window replacements.

Some investments just don't pay for themselves. High on the ‘Don't Do’ list are big projects like a master suite or sunroom addition.

You can check out Remodeling's lists yourself at www.remodeling.hw.net. Drill down to your region of the country, and even your city, for more precise data. 


Don’t miss our User’s Guide to Spring Real Estate starting 5pmET on FOX Business

Millennials Face Homebuying Hurdles

by Gerri Willis

First off, let me just put my cards on the table: I am in favor of home ownership. To be clear, I don’t believe in investing in a home to the exclusion of everything else, but I do believe it’s part of the equation if you want to set yourself up for financial success. Millennials, however, appear to be unconvinced about the value of owning a home.

It’s hard to read the business pages and not see a story or two about how younger potential buyers have decided that the ownership society is not for them. They are happy enough, according to these reports, with their smartphone and maybe a set of Beats wireless headphones. It’s cool to travel light, so the thinking goes.

But that attitude is masking a deeper issue:  Millennials are having a tough time affording a home. A punk job market isn’t just making it difficult to find work, but even those who do may find it’s difficult to find a job that pays enough to sustain a mortgage. Possibly even more important is the burden of student loan debt. According to the Federal Reserve, the number of 25-year-olds with student debt is rising, and the amount of debt they have has doubled in the last decade from $10,649 in 2003 to $20,926 in 2013.  As if that were not enough, housing prices are up 11 percent year to year, mortgage rates are higher and bank lending requirements are still tight.

All of those hurdles mean that many younger potential buyers are on the sidelines at a time when the opportunity in housing is huge. Prices may be up 11 percent year to year, but in many markets, prices still haven’t rebounded to the 2006 high water mark. What’s more, mortgage rates are still at multi-year lows. In other words, the stars are aligned for people who can afford to buy.

My advice: Don’t delay homeownership forever. Once you own, you’ll be able to take advantage of tax breaks like the mortgage deduction. And, even more important: Wouldn’t you rather pay yourself than pay a landlord? Overtime, when you buy a house, you build up equity, that’s an asset. Paying rent buys you nothing.

For millennials, the good news is this: The housing market isn’t going away. What’s more, inventories are constrained right now, and despite projections that interest rates are poised to go through the roof, it hasn’t happened yet. By the time this age group gets a down payment together, they may well find more choices on the market, and banks easing down payment and other lending restrictions.

Look, home ownership rates over the last decade may have slipped seven percent for those 35 years and younger, but they could rebound just as quickly. Millennials who want to invest for their future will save for a house. 

Don’t miss our User’s Guide to Spring Real Estate 5pmET on FOX Business

User’s Guide to Spring Real Estate

by Gerri Willis

Every month economists pour through a handful of real estate reports weighing the health of the housing market. Two weeks ago, for example, we learned that March home sales were down from the previous month. Then a week ago, we learned that the Case-Shiller 20-city home price index was showing that home prices were cooling for the third month in a row. Pending home sales, however, jumped.

What does this all mean for you? Probably precious little. The truth is all real estate is local. Local markets vary, taking their cues from the strength of the local employment market, affordability relative to renting and a number of other factors. And, all of that could be pointing in a very different direction than the national averages.

The good news is that you can do your own research to determine if now is a good time to buy or sell. In this blog, I’ll break down some of the metrics the pros use to evaluate a market and some common sense ideas as well.

In many communities, the local and state national association of realtors has a website where they post their reports on how many homes are selling and at what price. This can be a great reservoir of information. If there is not one available to you, it makes sense to contact a realtor active in your neighborhood or the neighborhood you want to buy in for information. Two numbers are critical: Price per square foot and days on market.

To get a sense of either how much you should charge for the home you want to sell or what you should be prepared to pay, divide the sales price of home sales from the last six to nine months by the square footage. This will give you a sense how to price a home or what to offer. This isn’t the last word on price, by the way, because the terms of a housing deal are set three months before they are made public, typically.

It’s also important to get a sense of the health of the community and what the common home attributes might be. Communities are like people, sometimes they are healthy and thriving, sometimes not so much. Check out whether local employers are hiring by talking to neighbors or reading newspapers. If you’re thinking about selling, make sure your home has all the attributes that the majority of homes have. Is central air common? You should have it too. Renovated kitchen? Better figure out how your kitchen stacks up before you put it on the market.

Days-on-market is a figure that you can get from a local realtor and gives you a sense of just how hot a market is. And, as you might expect, it’s simply the number of days it takes the average home to sell. Nationally, that time frame is going up, up, up. The National Association of Realtors reports that the average number of days it takes to sell a home in this country is 102. But there are big variations across the country. Homes in Denver sell in just 25 days, while homes in Santa Fe, NM, sell in 180 days. The longer a home is on the market, the more likely it is to get discounted. And, keep in mind, sometimes agents will let an aging listing expire so that they can re-list it and make it look fresh again.

Understanding the market is critical whether you are buying or selling. But it’s not the only thing that matters. This week we’ll be talking about a variety of other topics you’ll want to consider, such as whether now is the time to buy and flip a home. Is a primary home a good investment? Plus, we’ll dig into a variety of individual markets to find out the low down in Miami, Phoenix and others. Join us at 5p.m. ET each weekday starting Monday, May 12, for our special coverage of the real estate market. 

Self-Driving Cars: Are the Safety Features Worth It?

by Gerri Willis

You’ve been hearing about it for a long time now – the advent of the self-driving car – and while it seems like science fiction, the reality is, that we are getting darn close to vehicles that can do all the heavy lifting for you. They call it “Intelligent Drive” at Mercedes Benz, a number of bundled driver-assist features that allow the car to drive itself. There are cameras to augment sensors on the car, steering-assist and even brake assist. Take your hands off the wheel and the car literally drives itself. I recently went to Consumer Reports test track to drive a Mercedes S550 to find out exactly what it’s like to be behind the wheel of a car that drives itself. And, the answer is this: It’s not easy to give up control!

For example, when we tested the brake assist feature, rolling up to a barrier at 20 miles per hour, I found it too irresistible to punch the brake before the car did itself. To me, it’s just a little creepy giving up that much control over to a machine. On the other hand, if I were nodding off at the wheel on a dark and stormy night, I might be glad to have such a feature. There’s also a warning when you stray out of your lane and a park assist feature. The package on this particular model costs $2,800, but you can find other vehicles with some of these features integrated into the overall cost of the vehicle. The 2014 Jeep Cherokee can parallel park you, although I found the experience uncomfortable since it makes the move super quickly and, in my case, would have ended up on the curb had one existed. However, the Jeep’s blind spot monitoring was terrific.

I am not sure I would pay for all these features – not now anyway – but there are two features that all of these cars seemed to have that I would love to see as standard features. One is a back-up camera. I own a crossover and I find the ability to see behind my car is constrained. A rear-view camera would be welcome. The blind spot detection was also a bonus. Bottom line: I’m not sure I’m ready for all this technology yet, but some of it is much appreciated. 


Don’t miss The Willis Report 5pmET on FOX Business

Avoid College Tuition Sticker Shock

by Gerri Willis

Sticker shock. That’s exactly what a lot of parents across the country are feeling as they study the financial aid package being offered to their prospective college freshman. For that reason, if you are part of the sticker shock crowd, you’ll want to look in every nook and cranny you can for the scholarship dollars.

Normally, you’d expect your high school counselor to help you find grant money, but given that the ratio of counselors in any given school is typically 500 to 1, you’re best off scouring the field yourself. Where to start? Rob Franek, Princeton Review Vice President, says that the biggest sources of free money for college students are federal government and institutional grants, which together comprise 79 percent of all the grant dollars out there. But don’t ignore grants given out by employers and states, which make up 21 percent of the free money available.  Don’t forget the local Lion’s Club and your church.

Your child will be competing with fewer people for those dollars, even if the grants are small.  And, then there are off beat scholarships, like the ones for left handers, which are worth searching out.

The biggest bucket of money, no doubt, is doled out by the schools themselves to lure the students they really want to attend. You put your name in the hopper for this money by filling out the FAFSA – that’s the Free Application for Federal Student Aid. 

The good news is this – according to Franek – just a third of college students pay the full sticker price for college. By checking out websites like scholarships.com, you can bring down your total costs of college!

Don’t miss The Willis Report 5pmET on FOX Business

Appealing to a College for More Financial Aid

by Gerri Willis

The excitement of getting accepted by a college or university can pop like a balloon once you start getting your arms around just how much money your child’s education will cost you. This is the time of year that prospective students start getting their aid package for the upcoming school year and if you aren’t happy with what you see, you may want to appeal the school’s decision and ask for more.

Be advised: The process is delicate. College administrators don’t like to think of what they are doing as negotiating your package, so tread lightly. Kal Chaney, the author of “Paying for College Without Going Broke,” suggests starting by asking the college for information about their appeals process. Some may have a form, others may ask you to provide a letter. Review your aid forms and make sure that any errors are pointed out to the school. If your financial situation has changed, if there has been a job loss in the family or any unusual expenses, inform school administrators. To get their attention, make sure you document any income changes, even if for example, mom and dad are now also supporting an elderly relative. 

Another issue to consider: If you have received better offers from other schools that are ranked similarly, it’s worth your time to let school administrators know. Many may match or even beat the offer, depending on just how much they want your little John or Wendy at their institution.

Chaney says parents should be sure NOT to accept the offer of admission until the package is appealed and to never use the word “bargain” or “negotiate” with the aid office. (Even though that is exactly what you are doing).

Keep in mind, it’s not just low income families who get financial aid. For the first time, the average household income of financial aid applicants will top $100,000, according to Noel-Levitz, a college consulting firm. Bottom line, it doesn’t hurt to ask for additional help. Just be careful how you do it.

Don’t miss The Willis Report 5pmET on FOX Business

Decoding a College Offer Letter

by Gerri Willis

It’s that time of year when prospective college students all over the country are getting acceptance letters and financial aid packages. If you or a member of your family is part of this group, steel yourself. Confusion is the most common reaction to these packages. What’s more, you may be disappointed. That’s OK, it’s also that time of year when you can ask college administrators to step up the grant money.

But first, understand the package itself. The big headline is whether your son or daughter (or yourself) has been accepted. Congratulations if the answer is yes. Step No. 2 is to understand just how much this is going to cost. It’s not simple, given the way most of the award letters are written. A third of the award letters don’t include the full cost of sending Junior to school. Yes, it will include tuition and some fees, but other major costs, like books, transportation and living expenses are omitted, says Mark Kantrowitz, in his new book, “Filing the FAFSA: The Edvisors Guide to Completing the Free Application for Federal Student Aid.”

Watch out; too, for whether the money the college is willing to give you is a grant, which does not have to be paid back, or a loan, which clearly does have to be paid back. You’d think it would be easy to discern this from the letter, but unfortunately it is not. Loans are often not labeled as loans. So you’ll need to check with the school to make sure you understand which money is free and which has to be paid back.

When comparing offers, you’ll need to understand what the net costs to you will be. Beware: The letters include a net cost figure, but these often include loans. So, do the math on your own. Calculate a true cost of attendance and subtract grants, scholarships and gift aid – money you will not have to pay back. Then compare these figures across institutions.

The good news is that it pays to ask for more – more free aid. Thirty to 50 percent of families who ask for additional money from private colleges and universities get it. Many Ivy League schools will match needs based on offers from other schools. Or if your financial situation is changed through job loss, for example, you may be able to get more money. The key, here, is that it doesn’t hurt to ask. Insiders, however, say you’re best off not describing the conversation as a “negotiation.”

Bottom line, get the details before accepting the offer. Be sure you understand just how much money you and your family will be on the hook for, and what free money or grant aid you will get.

Don’t miss The Willis Report 5pmET on FOX Business

More Bang For Your College Bucks

by Gerri Willis

If there’s one regret most college students seem to have it’s this:  That they spent too much for their college education. I see the problem up close and personal here in New York City, where it’s not uncommon for a journalism student to graduate from an Ivy League or near-Ivy League school with $100,000 in debt. Given the fact that starting salaries in journalism are low, it’s no wonder these students struggle.

One rule of thumb prospective college students and their parents should use is this: Your four-year total college tab shouldn’t exceed the starting annual salary in your field of choice, that’s according to Kal Chany, founder of Campus Consultants and author of “Paying for College Without Going Broke.”  Chany says meeting that hurdle may be easier said than done, and added, “There is no one size fits all answer.”

To be sure, though, some students will find it difficult to hold to that rule of thumb, and for that reason, many apply for student aid. The FAFSA is the most critical tool to accessing that aid and you can still make application for federal student aid now for the 2014-15 school year. Even if you don’t think you’re eligible for assistance, Chany says it’s important to apply. Other common mistakes people make in applying for federal aid include using the wrong year’s version of the form, waiting to be accepted to college to apply for aid and even using an incorrect Social Security number.

But it’s not enough to simply borrow a lot of money. If you want to keep your costs low, you’ll seek out schools that have the best return on your dollar. The average cost of a four year degree at Harvey Mudd College as an eye popping  $229,500 with average annual scholarships of $27,763, but the return on investment over 20 years is over a million dollars. Graduates of MIT, the California Institute of Technology and Stanford University all enjoy similar high rates of return, according to an evaluation by PayScale.

Bottom line, plan ahead – in terms of both nailing down as much grant money as you can and finding a college that gives you value for your education dollar.

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