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Many states are feeling the pressures of the economic downturn and are taking measures into their own hands to fix it. This usually results in severe tax increases which impact residents the most. For the state of Illinois, recent legislature raised the level of income taxes residents will have to pay within the state significantly. These changes came about in response to massive state debt and economic decline.  The legislature was passed by a majority democratic vote as no republicans voted in favor of the new laws.

The recent tax hike in Chicago, IL has been making major headlines. The tax increase has raised the amount of individual income tax by 66 percent. Residents are worried that this increase will result in a decrease in overall spending which may further debilitate the state’s economy.  In addition businesses have been affected by recent legislature as well. Businesses in the state of Illinois will be subject to an overall tax rate increase of 46 percent. Critics of the recent changes worry that the tax raises will do more harm than good.

Patrick J. Quinn, the Illinois state governor spoke in praise of the legislature. A democrat himself, he feels this is one of the only solutions for a state that is mired in debt. Prior to raising taxes, the state was facing a fiscal emergency with an overall deficit of more than 13 billion dollars. Roughly 8 million of this amount is owed to social service agencies and others. The governor stated that “Our state was careening towards bankruptcy and fiscal insolvency.” Whether these changes will affect the economic state for the better is yet to be seen.

According to the new legislature, the income tax rate would rise from its rate of 3% up to 5%. In addition, the corporate tax rate would rise to 7% from its previous rate of 4.8%. Although these increases seem high, in comparison to the tax rate of other states, they fall within the median range.  The sudden increase is what makes the changes appear drastic to residents and media alike.

The hope is that residents of Illinois will accept the income tax increase as a concerted effort by the governor and legislators to help rid the state of its overwhelming debt. There was effort made on the part of legislators to reduce the state’s debt burden through other means. However the request to borrow $8.75 billion to help take care of the state’s unpaid bills was turned down.

In the end, the bill was overwhelmingly rejected by republicans. House representative Roger Eddy was quoted as saying “for years we’ve overspent and now we’re making it your problem.” Democrats seem to understand this sentiment but are aware that something needs to be done to remedy the situation. The bill barely passed with a vote of 60 to 57 in the House and 30 to 29 in the Senate.  This crisis should hopefully make the state aware of its overspending and the obvious need to trim spending and make budget cuts in the future.

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After two decades of exhibiting excellent performance, it appears that Delaware’s economy may be showing signs of depression. Although the recession officially ended in June of 2009, the state’s economy has not been showing signs of improvement. The outlook is bleak for the first fiscal quarter of the year and economists are not predicting any significant changes in the near future.

Delaware has been strong in its economic output for the past two decades, however recent reports show that the state is struggling. Unemployment rates have remained high and at last count it was still 6% below its previous rating prior to the recession. In fact the majority of its employment outlook seems to be moving in negative numbers. Excluding government jobs, the employment rate in Delaware has moved down to -5.4%. This signifies a loss of roughly 31,000 jobs. In addition, excluding government funds, personal income also declined by roughly -7.6% per capita. These numbers are grim and demonstrate that Delaware may be in need of additional federal dollars to help boost its slumping economy.

The housing market in DE is not much better than its employment status. Foreclosures and mortgage delinquencies are rampant while the prices of homes continue to remain low. In fact the sales of homes in the area are 28% lower than their previous peak rate. The climate of the real estate market in Delaware has caused a rise in personal bankruptcies registered throughout the state. Additionally, mounting personal debt has caused the majority of residents to rely on credit card spending to meet expenses creating inflation within the state’s economy.

Delaware residents are looking towards the coming year to help raise the amount of jobs and employment opportunities available to them. However the Delaware department of labor predicts a modest growth in the employment rate for the state of 0.74% over the coming year. Additionally demographics for the state show no increase in migration, a necessary stimulator of a state’s economy. Instead of new residents moving in to help boost the economy, there has been a surge in senior residents over time. This translates into less revenue spent by residents and a lower per capita income in comparison to the rest of the country.

The statistics show no projected improvement for the economy of Delaware. With a high unemployment rate and increasing senior population, the state appears to be on the decline and it may take a large concerted effort on the part of elected state officials to help rectify the situation. Restructuring the state budget for use to help attract visitors and future residents is one way to create a marked improvement. In an optimistic light, for the state of Delaware, there is nowhere else to go but up.

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There was much confusion surrounding recent state plans which seemed to leave union members in the dust. The plans have been revised and union members have cast their votes in favor of the new legislature which avoids significant layoffs and decreased benefits. The plan was revised due to much confusion and speculation about the previous deal the state had enacted. The union members hold out hopes that the new and improved plans will work in their favor.

In efforts to balance CT budget, a deal was proposed between unionized state employees and state officials. However the proposals fell through as it received only a 57% vote, not enough to pass it through under recent voting guidelines. There was some confusion over details of the plan and quite a bit of misinformation was circulated which caused the deal, proposed in June, to fall through. One aspect of the plan which caused union members concern was the healthcare sector. It was thought the union members would be required to join a healthcare program called SustiNet which is a universal health care program. Rosemarie Tate, a Hartford based mental healthcare worker stated that there was a lot of misinformation. Members were thinking that a wellness nutrition program was disguised as SustiNet. This has since been cleared up as no union members will be placed in the much debated program.

The new deal will help balance the $40.1 billion Connecticut state budget by providing $1.6 billion in savings. It is also set up to provide future savings through changes in areas such as employee contributions for retiree healthcare, retirement age for some employees and mandatory mail order prescriptions.

If the new proposals also fail to receive enough votes, the state will have to follow through on some drastic measure to help meet budgeting goals. Some of these measures include budget cuts as well as job cuts to total up to 6,500 jobs and thousands of layoffs. Notices have already been sent out to over 3,000 employees. The notices will be rescinded in the event that the proposals go through as planned. Tom Grodecki a supervisor with the union says that more members will vote for the deal especially since all the misconceptions surrounding it have been cleared up. He expects more than 45,000 of the union members will be in favor of the new deal.

One way or another, if the deal does not get approved, there will be thousands of layoffs and job cuts to make up for the state budget. Some of those budget cuts affected funding for substance abuse centers, vocational high schools as well as families with disabled children. Union members are grateful for a second chance to vote and are hopeful that a high vote count will push the new deal through. The results of the voting will be released this coming Thursday.

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Connecticut the state with the highest income in the country recently received the highest tax hike in state history. The bill was signed into effect and raised taxes by $2.6 billion dollars. Not everyone was in support of this increase in taxes claiming that it isn’t fair to make residents pay for government spending. However those in support of the recent tax legislature see it as a solution to balancing the state’s deficit without using budgeting gimmicks and spotty financing methods to do so.

The stipulations of the Connecticut tax hike raises taxes on those with an income of 50,000 or more. It also raises the tax on luxury goods to 7% such as boats over $100,000 or clothing purchases of $1000 or more. Before the legislature was passed, the state already collected close to $5000 from each resident in taxes alone. In fact the state’s residents have the highest tax burden after New York and New Jersey. The premise behind such high taxes may be that the residents can afford to pay it. The state has long been known to have the highest per capita income of any other state in the U.S.

The legislature passed through the House and the Senate but not without some criticism. Senator Andrew Roraback, a republican, was quoted as saying “We’re going to be spending more next year by taxing people.” His position stemmed from the sentiment that there are other methods of restructuring the budget that avoid overtaxing the residents to cover the needs of the state. In NY, Andrew Cuomo signed on a budgeting plan that avoided taxing millionaires to make up for the state’s deficit.  Instead the legislature closed a gap in a 10 million dollar debt without costing taxpayers a dime. This was also the case in New Jersey where republican Governor Chris Christie is pushing for legislature that allows for worker concessions and blocks levy increases while closing a $10.5 million dollar gap.

It seems that it is possible to meet the state’s debt needs without taxing residents as other states have managed to do just that. However according to supporters of the new laws, this restructuring method allows them to balance the state’s deficit without getting deeper into debt through the use of financing plans. Malloy, a democrat in support of the legislature was quoted as saying “I know it’s a tough vote [but] it’s also the right vote…the budget is balanced, honest and contains none of the gimmicks that helped us get into this mess.”

Although the tax hikes may seem exorbitant, it will help to balance a deficit that would have amounted to $6.2 billion over the next two fiscal years. The action taken now by the state has helped to prevent an even higher tax increase that would have been necessary in the future. The new legislature gives the state of Connecticut a surplus of $509.6 million at year’s end. A positive ending for the state that will hopefully bring an end to the need for any tax rises in the near future.

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After seeing a dismal loss in jobs during the recent recession, the state of AZ is finally showing signs of recovery. The recession officially ended in June of 2009, however signs of positive changes have been slow in coming in this desert climate. Statistics show that the economic state of Arizona is finally on the rise.

During the height of the recession, Arizona saw a total job loss of 312.000. That meant its unemployment rate was well above the national median. In addition to staggering job loss rates, other factors severely affected Arizona’s economy for the worse. One such factor is the lack of national mobility during a depressed economy. This has stalled an influx of new residents seeking homes in Arizona. This is one of the reasons cited for low population growth in the state in recent years. In addition, faltering spending at the state and local levels has caused economic growth to remain low since the recession.

Recent numbers have begun to show some promise for Arizona residents. For one thing, automobile sales have risen steadily in the past few months. An increase of 20% – 30% has been noted recently as consumers replace old and outdated vehicles. Besides the increase in auto sales, in the past six months retail sales have begun to rise into the double digits. Also on the incline are restaurant and bar sales, showing increases of up to 30%. Apparel sales have grown by 15%-20% and general merchandise sales have shown an increase of up to 10%.

The increase in spending is obviously related to the rise in jobs in recent months. Of the jobs lost during the recession, at least 23,500 have been replaced. Although not nearly half the total jobs lost have been completely restored, this surge of employment is a positive sign for Arizona residents and for the future of their economy. The total amount of unemployment insurance claims for the state remained lower than the national average. In addition, Arizona’s unemployment rate fell to 9.5% in March, down from 10.4% at the end of 2009.

Despite these positive signs, the housing market in Arizona remains on the decline. The census of 2010 found 463,000 vacant houses throughout the state. Of this amount, 180,000 are second homes and vacation homes. However despite the large amount of vacancies, the sale of homes in largely populated areas of Arizona has begun to increase. This is true for both the Phoenix and Tuscon areas of Arizona.

It will take time for the real estate market to pick up speed in Arizona just as in other areas of the nation. However the slow but steady increase in jobs portends a positive future for Arizona residents and migrants looking to move there from other states. The increase in spending among residents should further serve to stimulate the state’s economy and will hopefully symbolize an upward trend that will be continued throughout the nation.

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California, the most populated state of the country has everyone talking about it. Some media reports have stated that California has come in way under budget and will be facing a large debt that will be almost impossible to repair. Other reports state that the sunshine state is leading the nation in economic growth and output and is flourishing. Knowing which account to believe seems to require a more thorough examination of the facts.

Recent reports of an increasing amount of foreclosures in the state of CA as well as a decrease in state revenue have the media making some bold claims. The general concept is that the state of California will be facing large amounts of debt and a state budget that will be in need of major assistance as projections fall short of actual spending. Chris Whalen, a high profile analyst from Institutional Risk Analytics was quoted as saying “I think they’re going to default … I think eventually the debt will have to be haircut…I don’t think the Republican Congress is going to sign on for a bailout of California.” The analyst went on to say that Sacramento may have to begin issuing its own currency. These statements are quite drastic predictions for a state that has been leading the nation in population growth, a sure sign of economic proficiency.  To determine the basis of these claims it may be necessary to take a thorough look at the facts.

The state of California has been growing at a consistent rate over the last few years, outpacing the growth of the rest of the nation. In fact, according to the U.s. Bureau of Economic Analysis, its overall growth is up by 15% in comparison with a total U.S. growth of around 9%. In addition to its staggering rate of growth, the strength of its venture capitalist interests continue to remain high. According to recent reports from the National Venture Capital Association, California received fifty cents of every venture capital dollar invested in the United states in the past year. This means that since the silicon boom of the 1990’s, Silicon Valley investors are investing more money in California than they ever invested before.

Although California is currently experiencing budget problems, it can be attributed to unwise distribution over the past years and may not be indicative of a struggling economy as a whole. According to recent data, California has had a surplus of revenue over the past quarter century up through the year 2005. In fact in the year 2005 it had a surplus of $50 billion dollars. The excess funds were distributed through what is called a “fiscal transfer.” This essentially means that California had such an excess of funds that they were able to distribute that excess nationwide.

Despite rumors and speculations that California’s economy is sinking, facts demonstrate otherwise. The most populous state in all of the U.S., California is also the state of the highest wages. In addition, the continued interest of venture capitalists in the state of California is further evidence of the strength of its economy. Budgeting issues may be reflective of poor decision making and distribution at the state level rather than any deficiency in California’s economic strength overall.

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Many Americans are faced with a mountain of revolving debt with little clue as to exactly how it happened. The trap of revolving debt is a dangerous one in that it often catches consumers unaware. Understanding how revolving debt works and taking positive steps to change is the best way to ensure a drastic financial change for the better.

Understanding how revolving debt works is helpful in being able to avoid it. When credit card holders make consistent late payments on their accounts, they incur late payment fees that are in addition to their current balance. In addition this combined balance is then assessed an interest rate which causes the balance to increase. If only the minimum payment is paid monthly, it soon becomes very easy to carry a balance well into the hundreds and even thousands of dollars. The situation is made worse by compounding interest and additional purchases. To end the vicious cycle of revolving debt, the first step is to pay more than the minimum required and to avoid making late payments at all costs.

Most people who obtain credit cards do not do so with the intention of overspending. However little by little, the lure of easy purchasing accessibility becomes too great. Add to that the unforeseen job loss or untimely expense and it can be easy to understand how a large credit card balance accrues. The key to avoiding debt is to budget spending and plan for emergencies using a savings fund. These two steps will help in eliminating the majority of debt that is incurred by consumers. Deciding beforehand how the credit card will be used as well as making timely payments will help in maintaining a low balance. This requires self discipline and planning. Utilizing the services of a credit counseling agency is a great way to stay focused on your budget and receive the necessary guidance to fulfill your financial objectives.

For those who have found themselves facing a mountain of debt with little hope of escape, rest assured that there are options available. If you choose to manage your debt on your own, consider consolidating your credit cards by transferring your high balance to a credit card with a lower interest rate. For those who need more advanced help, research debt settlement and credit counseling services to find one best suited to your needs. These companies are adept at working with creditors and may even be able to eliminate the majority of your late fees and charges as well as make monthly payments to your creditors on your behalf.

It can be overwhelming to deal with a large credit card balance that never seems to diminish. The key to making a dent in your balance is to pay more than the minimum and to pay on time. Understanding how quickly your debt can increase due to compounding interest is key in avoiding the situation. Ultimately there are many debt relief professionals available to assist consumers who are overwhelmed by debt. Taking advantage of these services will help those who are looking to put an end to revolving debt and improve their finances for the better.

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Managing student loan debt can be a difficult endeavor. Graduates fresh out of college may find it difficult to make payments on several student loans simultaneously. In addition, if they opened credit card accounts during their college years, their combined debt may prove to be more than their new income can support. Figuring out how to manage your student loans and debts after college are a necessary skill that can aid in paving the road to a sound financial beginning.

When managing several student loans at once, one of the best options is student loan consolidation. A student loan consolidation will minimize your payments by combining all your loans into one. Instead of making many payments to different loan companies you are making one single payment. This can make it easier to budget your finances as well as make payments on time. You may also find that your consolidated interest rate is lower than that of your individual loan accounts. This ensures that your payment goes  more towards your principal than towards fees and interest. An additional benefit of consolidating your student loan is that of more flexible payment options. You may have the option to defer your consolidated loan if your financial situation qualifies you for a hardship deferment.

In addition to balancing various student loans, many college graduates are also handling credit card balances from debt they incurred throughout the school year. Many items such as books and supplies can add up throughout the school term and some college students even use their cards to help pay for classes when their student loans fall short. If faced with both a large credit card balance and a heft y student loan, it is best to pay on the highest APR account first. This usually means paying off those high balance credit cards takes priority. If possible, apply for a deferment of your consolidated student loan and use the additional funds to help pay down credit card debt faster.

In addition to consolidating your student loans and applying for a deferment, it is also beneficial to pay the accrued interest on your student loans during your deferment period. This aids in lowering your overall balance and making the payments more manageable when your deferment period has ended. You can find out your accrued interest amount by checking the monthly statement sent to you by your student loan creditor. In some cases the interest on your student loan may be forgiven. Contact your creditor to find out the exact terms and conditions of your loan.

In the end, student loan debt is an investment for your future. Although it may seem overwhelming to have these bills come due six months after graduating, just keep in mind that you won’t be paying on them forever. Having a solid financial plan and making consistent monthly payments on time will work in your favor towards establishing a good credit history and sound financial future.

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Most people are aware that filing for bankruptcy is a major decision. A bankruptcy filing has the potential to erase most unsecured debts and give the individual a new start. However a bankruptcy filing can also affect your credit score, credit history and other areas of your life in a major way. Becoming aware of the ramifications of a bankruptcy filing is mandatory before making this decision. Finding out all the facts will ensure that a bankruptcy filing is the best option for the individual.

Before filing for bankruptcy, it is a good idea to speak with a credit counseling or debt settlement company. These companies may be able to help you come up with creative ways to restructure your debt that you may not have thought of. A home refinance or second line of credit may provide you with additional funds to pay off your debt at a lower more manageable interest rate. You will also want to speak with a bankruptcy lawyer before proceeding with a filing. A bankruptcy lawyer can help you know exactly what to expect during the proceedings and how it will affect you in the long run. However be aware that they may not provide you with neutral advice as they are in the business of filing bankruptcy petitions.

Bankruptcy affects your credit in many different ways. The ruling will remain on your credit report for up to ten years. This may also affect your ability to get additional credit in the future.  Credit card companies may not be willing to extend an offer of credit when they see a bankruptcy filing on your report. A bankruptcy filing can also affect other areas of your life. If you work in the finance or retail field, your employer can request a copy of your credit report before extending an offer for employment.  In addition, when seeking rental housing or applying for a new mortgage, a bankruptcy filing on your credit report may affect your mortgage interest rate. It can also affect your approval for the apartment of your choice.

Insurance premiums may be higher when a bankruptcy filing shows up on your credit report. This may cause your overall payment to become unmanageable and may make it difficult to keep up with your other bills. It may be that the long term cost of filing for bankruptcy proves more detrimental than the short term benefits of erasing your current debt.

Ultimately, a bankruptcy filing should be used as a last resort. Every effort should be made to negotiate with creditors to resolve outstanding debt. If possible, work with a credit counseling service to negotiate lower interest rates and to eliminate late payment fees. You can also work with a debt settlement company to settle your debt for less than the full amount. Ultimately a bankruptcy filing has the potential to affect every area of your life from your credit score to your employment options and even housing availability. It is not a decision to be made lightly and all other options should be exhausted before making the final decision to file for bankruptcy. Consulting with a lawyer can best prepare you for the bankruptcy filing process.

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