We received a notice over the weekend that our economic stimulus check should arrive “by May 30.” This is very exciting for me, since I figured we wouldn’t see the thing until sometime in July. I’ve always been the primary filer (since I make most of the $$$), and the last two numbers of my SSN put us in July for receiving our economic stimulus tax rebate.

So, even though the IRS transposed two numbers on our address and the notice (and likely our check) went to the neighbors across the street, I’m feeling very optimistic. For myself. Because I don’t know how much these checks will really stimulate the economy.

At any rate, I think that one of two things happened:

1. Here in Utah, the man is always assumed to be the primary for everything. So, my new accountant assumed that my husband would be primary, despite evidence to the contrary. Or,
2. My new accountant is a genius, and realized we’d get the economic stimulus check earlier if he shook things up with our tax filing.

Hopefully, the change won’t result in an audit (I don’t think it will). But whatever the reason, we’re getting the money earlier.

If you’re like me, it’s time to make an adjustment in the monthly budget. The dairy that we use is announcing increased prices on milk, cheese and eggs. And the fuel surcharge for delivery has gone up. Again. Not that we mind that much. After all, we like supporting local businesses — especially those with sustainable practices. But it does mean that we’re making adjustments.

But we’ve noticed a change at the grocery store as well. Food costs more. And we all heard about that panic-induced trend to hoard rice a few weeks ago. (Disclosure: I did not hoard rice. There is nor reason to, since the US is not experiencing a rice shortage.)

So is wheat the next target? Probably not. In fact, the wheat harvest is likely expected to be very good this year. But that isn’t changing the rate of food prices inflation on items like bread and pasta. Why is this? Wheat prices are dropping, and the harvest should be abundant.

The answer is in other issues. Harvesting wheat requires energy. And all the steps in between — the steps that take wheat and turn it into flour for bread and pasta — take energy as well. And energy prices are going up. Then you have to transport the food to wherever it is going. So that adds to the cost.

So, it is time to accept that, right now, even with economic stimulus tax rebate checks on the way, it is time to think about what you are spending your money on. Because more of it is going to be spent on food.
image credit: US government

I’ve got a guest post up over at Lazy Man and Money. It offers four investment ideas for your economic stimulus check. Head on over and give it a read!

Also: I have a guest post on paying down college debt over at Generation X Finance. A little bit of insight into how my husband and I are paying off the student debt, now that credit card debt is gone.

As you know, many of us are expecting a tax rebate in the next few months. However, as is usually the case when something like this is announced, scammers come out in full force. The latest scam take the form of an “email from the IRS” telling you to sign up for direct deposit to get your tax rebate faster.

You go to the linked form and put in all your bank account information. You can see where this is going. DO NOT ever give personal information in response to an email. The IRS does not start communication via email (although it may send you updates if you request them), and does not ever ask you to enter personal information via a linked form.

You can see a copy of the tax rebate scam warning at the Internet Crime Complaint Center.

Several people have been asking me how they can check the status of their tax refund, and how to figure out when they’ll get their tax rebate. So, here are the appropriate links from the IRS, answering those questions:

1. Check the status of your tax refund. You will need your SSN, filing status and refund amount shown on your tax return.
2. When will you get your tax rebate? This depends on three things: the last two digits of your SSN, when you filed your tax return, and whether you are doing direct deposit for your tax return. If you didn’t file by April 15, your tax rebate will be delayed. (For fun, My Money Blog offers this look at tax rebate promotions offered by a variety of stores.)

The last checks will be mailed out July 11. Unfortunately, with the last two digits of my SSN, and that fact that I owed taxes and didn’t select direct deposit, no check until the very last for me. I wish they’d use my husband’s, but since I’m listed as the filer, and he’s listed as “spouse,” I’m thinking not.

After months of dissembling, Alan Greenspan has whipped out the “R” word. That’s right. Now he thinks we’re in a recession. But he has qualified it. It’s a “pale recession.” Whatever that means. A shallow recession? A not-that-bad recession? A the-economy-is-doing-better-than-we-thought recession?

Greenspan insists, as well, that stagnation is what he expects for the remainder of the year, according to Reuters:

Greenspan doubted there would be an immediate recovery, saying stagnation for the rest of the year was the most likely outcome. “That’s certainly the most benevolent scenario,” he said. “It’s not all that far from being the most probable.”

What? The tax rebate checks aren’t going to magically end the economic slowdown?

image credit: US government

I’ve been thinking a lot about “economic stimulus” and the tax rebate. The tax rebate, especially, was brought to my attention on Friday when the announcement was made that direct deposit tax rebate payments will start today — ahead of schedule. Tax rebate time will continue through July, depending on when you filed your tax return, what your last name is and whether you are getting your tax rebate via direct deposit or check.

And whether or not we’re in a recession (which is debatable) it is important to keep in mind that with food prices inflation and increasing oil prices, this tax rebate isn’t likely to do much for the economy. Indeed, a lot of people will probably us the money to buy increasingly expensive necessities. After all, it’s really about personal finances and priorities. It’s not longer about the economy. Indeed, one commenter made a very good point about all this recession talk:

I don’t care what you call it. Six houses in my neighborhood are in foreclosure. Three of my neighbors have been laid off. The people in the house next door have walked away and the house is now abandoned. And I live in Fairfax County, Virginia, which is supposed to be one of the wealthiest counties in the US. I’ve been around more than 70 years and have never seen anything like this in my lifetime.

All this talk about “economic stimulus” and recession and what to do with the tax rebate doesn’t really speak to the individual level of personal finances that you need to consider. At this point, you need to do what’s right for you.

image credit: sxc.hu

Here at Yielding Wealth, there has been many posts about the tax rebate, and the economy and a possible recession. And, of course, I’ve got many questions along these lines:

There is a lot of debate about whether we are in a recession, and how we can prevent a recession. I want to know: What IS a recession?

This is an excellent question! Many people are wondering this.

The definition of a recession is basically two consecutive quarters of negative GDP growth.

Of course, there is debate over that simple definition as well.

At the National Bureau of Economic Research, a committee defines a recession as the period that business activity starts to fall after reaching its peak. The recession lasts until business activity bottoms out and begins to rise again.

Either way, though, it is clear that you don’t know that you’re in a recession until you can go back and look over the data. However, some economists think we’re in the midst of a recession right now, and that when we look back, the data will show this as a period of declining GDP.

No matter whether we’re in an economic slowdown or a recession, though, it is a good idea to apply sensible personal finance practices to your situation, that way — whether economic slowdown or recession — you are prepared for the future.

One of the beefs that many mortgage lenders and the National Association of Realtors have had when it comes to “economic stimulus” has been a lack of attention for the conforming loan limit. Now, that is likely to change.

In all the hoopla surrounding last week’s tax rebate announcement, the fact that the new plan allows for a temporary raise to the conforming loan limit was lost. The Seattle Times reports on this conforming loan limit move:

It would raise loan limits temporarily above $700,000 for the quasi-government entities Fannie Mae and Freddie Mac, which fund the bulk of the nation’s mortgages. Until now, these entities couldn’t buy and package mortgages larger than $417,000, the so-called conventional-loan limit. …

The House plan would permanently increase the maximum loan size for mortgages backed by the Federal Housing Administration (FHA) from $362,790 to $729,750.

For high-priced housing markets, this means that more people, especially first time home buyers, will be able to get conventional mortgages, rather than having to resort to much more expensive jumbo loans.

But no matter where you live, no matter the housing prices, you are probably in a buyer’s market. If you can afford to, now is the time to buy.

Not too long ago (last week), I mentioned that a $500 tax rebate idea for stimulating the economy was getting kicked around. That idea has been modified to a tax rebate in different amounts for different people, and is expected to be one of the points of a Bush economic plan. And it will probably work.

The government wants us to spend more money, and is willing to give it to us to spend (it builds “confidence” in the market, you see). And, as Americans, we usually do spend the money. Less than half of Americans with a significant tax refund actually plans for the future with it. It usually gets spent. So if the plan is to fix the economy by spending more, we will probably, in fact, be given the means to spend more.