Monday, February 28, 2011

Doorstep Lenders Receiving Unwanted Interest

Unwanted interest has come from sources including industry regulator, the Competition Commission (CC), following an Office of Fair Trading (OFT) investigation which was in turn sparked by a super-complaint lodged by the National Consumer Council (NCC).

Doorstep loans offer small short-term loans to people who are on low incomes or without access to bank accounts, with repayments being collected weekly or fortnightly by collectors who directly call at the customer's homes.

Peter Freeman, chairman of the CC, said, "Customers value home credit because it suits their needs very well but the fact is that they are paying too much for it, because of the lack of competitive pressure in the market."

The regulator found that the lack of competition in the home credit market has meant that customers had, in their opinion, been overcharged by £500m during the past five years.

Peter Freeman believes, "Price competition between the existing lenders is weak, partly because customers seem insensitive to prices, given the greater value they place on factors such as the convenience of the loan and the difficulty in comparing prices between companies."

Although there are more transparent alternatives to doorstep lenders through such high street companies as My PayDay Loan ( ), which provide quick access short term loans, the six major door-step lenders still account for about 90% of the market, with the largest, Provident Financial, currently owning 60% of the £2bn per year industry.

Whereas there is ample regulation and there are high levels of competition for traditional unsecured loans, with financial product comparison sites like Moneynet ( ) providing consumers with quick access to comparisons across the standard loan industry, there is little competition and product comparison information is not readily available from doorstep lenders. The CC announced that the lack of adequate competition within the market was allowing lenders to overcharge their most vulnerable customers.

The CC recommended a series of changes to help reduce the problem, including suggestions that the lenders provide better information on their pricing and introducing regular statements in an effort to allow customers to shop around easier. Another suggestion to promote increased competition which was put on the table was for more data sharing with the credit reference agencies by the lenders about their customers' credit histories. The CC also threatened that if lenders did not follow the recommendations, then in future it might impose a price cap on the maximum interest payable for these types of loan.

The CC's announcements have provoked a furious reaction from the doorstep lenders who have challenged the calculations and the conclusion that this sector of the loan industry was making excessive profits.

A representative for Provident stated, "Customers are not being overcharged for their home credit loans nor is the home credit sector making excessive profits."

Provident commented that the method of calculating the loan profitability was "flawed", as it did not include the intangible costs of running a network of agents who collected payments door-to-door.

Peter Freeman, chairman of the Competition Commission, said recommendation by the CC might help to encourage some of the more mainstream banks to extend their lending practices into lending to lower-income customers.

All information contained in this article, is for general information purposes only and should not be construed as advice under the Financial Services Act 1986.

You are strongly advised to take appropriate professional and legal advice before entering into any binding contracts.

Sunday, February 27, 2011

Donating To Charity On A Budget

I always feel guilty that I can't give to charity more than I do. But, honestly, my budget is trimmed down to the bare minimums and our income just meets those obligations with pennies to spare. Still, I feel that I should be giving something. After all, I know that there are other families struggling much harder than ours to simply provide the very basic needs of survival.

You need only to look at your budget to see that our society places a high price on the very basic needs of food, shelter, and clothing. Seems odd to me. In a perfect world these basic needs of survival would be more modestly priced if not free. But, this isn't a perfect world (at least not by my assessment) and that's not the case. That's why I think it's important to give in some way, even when you can't imagine where it will come from.

Here a few little ways you can give and not really miss it.

1. One of our local supermarkets (Shoppers) has a display at each cash register where you can add $1, $3, or $5 to your grocery bill as a donation to the food bank. It doesn't hurt so much to give in these small increments often, as opposed to one larger lump sum. I think this is a great idea. You may find this convenient for you if you have a Shoppers or other supermarket in your area with similar donation opportunities.

2. Take advantage of food collections at post offices, schools, and even the supermarket. One or two cans, boxes, or bags of non-perishable foods will probably not ruin your entire menu for the week. You may not even miss it and you'll be making a charitable donation. I have ample opportunities in this area as I have four children in three different schools (elementary, middle, and high school). All three do food drives every year. Our local post office and supermarket also participate in food collections around the holidays.

3. During the holidays, toys for tots is a great way to give a gift as a donation. Some people say they feel cheap if they only give one gift. Well, you can give just one. It's not only acceptable, it's very much appreciated. One from you, and you, and you, and you, ......... well you get the picture. Collectively, it adds up to a happier holiday for many less fortunate children.

4. Take advantage of donation matching to make smaller donations go further. I have certain charities that I receive newsletters and updates from. I recently read of a matching opportunity in one of the newsletters and donated $5 during the promotion. That means that the matching donator gave $5 as well.

5. You can also set up a reoccurring payment in your bill pay program as a donation. Set up a payment to send a donation of $5 every week, bi-weekly, or even monthly. Whatever you feel your budget will permit. If you ever fall short, just reschedule or cancel the payment for that period.

6. Don't forget that donating your time is valuable, and appreciated, also. Volunteer to help a neighbor, visit a nursing home or home for the elderly, cheer up hospital patients, or help out at a local charity organization.

7. Donate all your unwanted items and clothing to a family in need, the Salvation Army, or other charity owned thrift store.

You can see that if you really put your mind to it, you can come up with a variety of ways to donate when donating seems impossible. Donating more often in smaller increments is a lot less noticeable than forking out a large lump sum. And, donating your time is sometimes more appreciated than money, since organizations may really need the manpower to be successful. A warehouse full of food won't do anyone any good if there is no manpower to get it where it is needed. In today's fast paced society, time is a valuable gift to give!

Saturday, February 26, 2011

Don’t Retire in Thailand Unless

Don’t retire to Thailand unless you enjoy a very low cost of living. Lease a property for under $50,000 – a place that would cost you 10 times that much in your home country.

Don’t retire to Thailand unless you like to eat really good food for very little money. Seafood, fruits and vegetables for mere pocket change.

Don’t retire to Thailand if you disdain real culture and old fashioned customs. Learn to live with Buddhist principles and live your life like a Thai with a “mai pen rai” – never mind attitude.

Don’t retire to Thailand if you want to remain single and lonely. Find a good Thai lady who will take care of you like a king for the rest of your life.

Don’t retire to Thailand if you like snow and cold weather. Tropical breeze, emerald waters, and sandy beaches abound in Thailand. Cold is when the temperature drops below 70 degrees Fahrenheit.

Don’t retire in Thailand if you are an old man who thinks that he doesn’t have a chance with a beautiful, young Thai lady. Age is just a number in Thailand and the ladies prefer a man with a good heart over one who is young and superficially handsome.

Don’t retire to Thailand if you would rather spend your final years at home with family and friends. I would rather spend my final years with my new 26-year old girl friend who is soon to be my wife. I am almost 56 and this young lady will do anything for me. She is well educated, single, a school teacher and has great values and a very positive attitude. My family and friends can come and visit me if they want.

Don’t retire to Thailand if you hate to travel. Being in Thailand you can easily travel all over Asia and very easily travel to Burma, Laos, Cambodia, and Vietnam. Japan, Singapore, Korea and more are 3-hour flights away.

Don’t retire to Thailand if you are rich. “Joe Average” on a meager pension of about $500 per month can live comfortably in Thailand. A rich man can live like a king if that is what he wants. If you have a pension or retirement plan that pays you $1,000 or $2,000 per month – you will live the life of luxury.

Don’t retire to Thailand if you think you are better than the Thais. Check your attitude at home and if you want to live in Thailand, just go with the flow and enjoy your retirement. The Thai people are great – you just have to learn the customs and culture. It will definitely not be the same as your home – but who cares.

Retiring in Thailand is totally “up to you”. Don’t do it unless you are prepared to live your final years in a wonderful country with some very beautiful people.

Friday, February 25, 2011

Don't Let Rates Get You, Lock It

When interest rates begin to go up on mortgages, having your rate locked in can really protect you until closing.

The average rate on a 30-year fixed rate mortgage has risen almost 1% in the past year. While the rise has been mostly gradual, many home buyers can't risk having their rate go up any between the application and closing on a home. They are already stretched as far as they can go to get into the home.

When you don't lock in your rate, it is floating with the market. A traditional rate lock is the lender's guarantee that your mortgage will have the quoted interest rate, points and other terms at closing.

A rate lock is usually set for a specific amount of time. If the home purchase isn't complete within the time limit, your rate will unlock. Then your interest rate can go up.

If you qualify for a given rate as the maximum mortgage amount you can receive, you are walking a tight rope. If interest rates rise before closing, you may have to add more of a downpayment or lose your financing. A rate lock will protect you from this.

When you lock in your rate in a traditional rate lock, if interest rates go down, you are stuck unless you pay additional costs. Some lenders offer "float down" options that will let your rate lower once if rates fall. But many of them will stick you back up to the higher rate if the rates rise.

The key to a rate lock is ensuring that you have everything in writing. Verbal locks aren't legal. If the lender says the rate is locked, make sure you get it in writing.

You should also pay attention to the pre-set time limit for the lock. In some cases, the lender may automatically extend your lock, but that doesn't always happen. Many will charge you a fee to extend the lock, often a percentage of the loan amount.

The rate lock contract should lock in as many costs as possible. This includes not only interest rates, but also points. The agreement should include you name, the lock's effective date, the agreement date, the lock cost, the rate and the loan terms that are locked in. There should also be an expiration date and time and any options upon expiration of the lock.

As soon as you see the desired rate for your mortgage, you should lock it in. This is usually found when you apply for the mortgage.

Before you set the lock-in period, make sure you have an accurate estimate on how long it will take to process the loan and close on the home. Once locked in, make sure that you push the lender and others to close on time. You can help by quickly returning phone calls and turning in any necessary paperwork as soon as possible.

The lock will cost you money. Some lenders will even charge you an up-front fee even if the loan doesn't close. Others charge a flat fee at closing. Some lenders charge a percentage of the mortgage amount, a fraction of a percentage point or a slightly higher interest rate for the rate lock. The cost varies depending on the options you choose and the mortgage program you qualify for.

Don't let rising interest rate surprise you at closing. Lock in your rate and worry about other things instead.

Thursday, February 24, 2011

Don’t ignore this otherwise you will lose everything

Each and every type of business whether big or small needs insurance protection. Insurance is of equal importance for all business activities, assets and individuals working in it. Insurance capacity of a business firm depends upon its nature and size. There are number of risks all around us and we don’t know their time, date of their happening. So, to cover such events, insurance is needed.

Purchasing business insurance is very important task and such decisions are to be formulated properly. The business insurance should be of such type, which covers each and everything of your business. If the business needs were not properly investigated before taking or applying for business insurance, it would result into wastage of money or death of your company.

There different types of insurance policies available for your business include: Property insurance means protection of your assets or business properties from theft, natural calamities or physical damages. General liability insurance protects business proprietors and its operators from various liability coverages. Workers' compensation insurance protects a business to wrap different job-related damages or sicknesses. Auto insurance is designed to insure business vehicles. The other type of business insurance includes health insurance, key person life insurance, business interruption insurance, excess liability coverage, employment practices liability coverage and travel insurance.

There are numerous providers of business insurance so, it becomes important to select best insurance company providing all insurance services under one roof and on cheap rates. A business firm has to pay insurance premium, which is based on the degree of risks involved. Firstly the insurance company appraises the situation and then decides the premium rates.

Wednesday, February 23, 2011

Don't Buy a Car From a Tote The Note Dealership

I have been all around the car business for years and I hate to see people make mistakes that hurt them in the end. Simply buying a car from a tote the note dealership is a terrible waist of money, it is always overpriced and does nothing but damage your credit report. The reality is that there are ways to get a car with the same qualifications that a tote the note lot wants you to have. The difference is it will be reported to all the major credit bureaus and usually has a warrantee to give you a piece of mind.

This is how a tote the note lot works, they shop used car auctions and buy cars that major dealers don't want, usually for under $3000. Most of the time they don't even dive them if the seller (another used dealer) says that it is good. Then they put it on their lot for $5999, yes that much profit. The reason is simple your down payment is usually about half or all of what they have spent on the car. Then your payments for the next 4-5 years are mostly, or all profit for them, but does nothing for you. In the next four or five years if you have a car problem you are just stuck in a bind. If you call the lot they say it is not their problem, or they say they will have their shady-tree mechanic fix it. Then extend your note so they can make some more money from you. If you can't afford to fix it you still have to pay or they will repo it, and most times report it onto your credit report. That's the problem they only report if you default on your credit report. They don't report all the payments on time you made. They don't want your credit to get any better so that you and others have to come back and buy cars from them. Then they take that same car and sell it to somebody else, and guess what, this time it is all profit. There is a better way.

There are some major dealerships (Dodge Chevy Ford) that have special finance programs that work especially with people with poor credit, or even no credit and even without a cosigner. The way this works is a car is traded in, and the dealership has their service station inspect it. They load the info like miles, condition, make and model into a program and the special finance lender determines the price. That way you can't get overcharged. The reason is that the lender does not want to repo the car and have to resale it. That's why they will usually give you a 2-3 year payment around 250 mo so that you can pay it off quick. Usually they like to cover it with a warrantee for special finance customers. Just incase your car breaks down you will be able to have it fixed and continue your payments.

Here is the best part, a special finance company will report to the bureaus every month of your on time payments, that will start to raise your credit score. All you need is six months to a year of on time payments on your report, and then a regular lender will give you a shot. A major dealership wants your credit to get better so you can comeback and buy again.

"But I went to a major dealership and they embarrassed me about my credit." you say, not all major dealerships deal with special finance. There is an even easier way; you can apply for your financing online, with special finance lenders. Then you never have to worry about the public rejection of the dealership, and they never see your credit. Most companies will approve you instantly or in 24 hours. You can print your approval out and go and shop like everybody else.

Tuesday, February 22, 2011

Don't Bother With The Banker

Bankers are seeing less and less new faces at their desk every day. The Internet has taken their clients and provided them with cheaper, easier and more convenient ways to get the money they need. As generations continue to march on, traditional lending companies are being forced to provide newer outlets to get younger people’s business.

Unfortunately, with the lightning-fast expanse of the Internet, they’re failing.

No longer is it required of anyone to trudge down to their local bank to borrow money. Now anyone with access to a computer can apply for loans online. Since most public libraries offer free use of Internet-connected PC’s, nearly the entire world has Internet access.

What’s so great about applying for a loan online? Well, first, privacy. Internet browsing is now more secure than ever, with most websites offering highly encrypted loan applications. Server technology can now decode your personal data after it arrives on the loan company’s machine. These machines, which are only accessible by security-clearance holding individuals, are top of the line, secure, and hack-proof. Your data is safe.

Another great reason people are applying online for loans instead of visiting the banker is the immense amount of information available online. No matter what your question, you can find an honest and sometimes highly valuable answer that can save you money, whereas your banker can’t know it all. Even if he’s highly capable of providing answers, he can’t get them all.

Thirdly: accountability. Online lenders have to provide their potential customers with a large amount of information in order to ‘get the sale’. If they provide bad service, you can bet that Internet users will post that information online. A simple search for a lender can show you if people are happy with their service, or dissatisfied with it. Lenders go out of their way to make their customers happy, and once again that means better service and quality than any banker.

And probably the most important reason why people submit their loan applications online is the sheer amount of options. Online lending companies have to be greatly competitive – which translates into huge savings for people who take the time to look around for the best deals. There are so many online lenders that they are simply forced to provide a high level of service, or people will just not use them.

Online lending has taken huge strides to improve their image, and customers are responding. Borrowing large amounts of cash from an online company is a hugely growing trend. Bankers are not seeing as many faces because they are just overwhelmed with the amount of quality competition on the Internet. Between the advance security, vulnerability and accountability of online lenders, banks just cant keep up.

Monday, February 21, 2011

Don't Be Scared By Interest Rates

Let's look at what we have been hearing. That with rates up, homebuyers will pay thousands of additional dollars on their mortgages. For example, on a $500,000 mortgage, an extra .5% in interest rate adds another $160 a month to the payment. In thirty years, the increased rate costs $57,000 more.

It's a bit more, but it is part of financing anything. Rates go up and down. That's how it works. Yes, rates have been steadily rising -- from RECORD LOWS. If you look at the last twenty years, you will see that mortgage rates are looking pretty good when compared to some of the highest years. You can still get a mortgage, even if rates go up.

You may not be able to afford the home you really wanted, but you can afford a home. What is the difference that half-a-point will make for you? Well, you might not be able to afford a $300,000 mortgage, but you could a $285,000 one.

The best thing that rising rates has done is emphasized the importance of making smart decisions when purchasing a home. Rule number one -- only buy what you can afford. This is increasingly important right now. Many homeowners have stretched themselves to get into homes that have record high appreciation. They now can't pay their adjustable-rate mortgages and can't sell for what they owe.

Buying what you afford isn't just a right now situation. When you are choosing an adjustable mortgage product, you have to look to see if you can afford the worst-case scenario of the highest possible interest rate. If you can't, you need a new plan or a new prospective home at a lower price.

You need to thoroughly understand all of the risks associated with different types of mortgages. There is fine print that can kill you. But what is causing most of the "payment shock" we are seeing this year is not in the fine print. You know that an adjustable mortgage will increase in interest rate. What you haven't done is sit down and see how that rate could increase your monthly payments.

You shouldn't be scared to go out and purchase a home or take out a mortgage right now. What you should be is wise. Make the right financial decisions for your family based on your budget, what you can afford and what the interest rate is right now. Buy what you can afford at a fixed rate and you won't have to worry about rates going up. If you find that you can't afford what you want right now at the given fixed rates, be assured that rates will go down eventually. Sit on your money and let it build up while you wait for the right time.

If you are looking on financing a major purchase, like a home or a car, take the time to educate yourself on all of the available options. Remember that everything is your decision. You aren't stuck with a certain rate, but you can jump into the wrong one. Interest rates will affect you and will affect your budget if you have substantial debt. You will have to make changes. But don't let these still historically low rates scare you into not receiving all of the advantages that owning a home can bring.

Sunday, February 20, 2011

Don't be Money Ignorant

There are some simple things that you have to know how to do. But it seems like no one ever sits down and teaches you. Balancing your checkbook, making wise financial decisions and handling debt are vital to your financial health.

I guess it's something that we make our mistakes and learn from. But today, the mistakes are costlier than ever. With credit cards targeting college students and debt problems affecting millions of consumers, every person should take the time to make sure that they and their children know how to manage their finances.


Have you ever stressed about money? I won't say that proper management will eliminate money stress, but it will certainly cut it back by around 90%. If you've ever spent hours fretting over where you will get the money to pay for bills or gas or whatever, you will truly appreciate the freedom proper financial management brings.

And the thing is, it is so simple. The first things you should know are how to balance your checkbook, what interest rates are and how you pay off loans and save for retirement. Do research before you buy a car or take out a loan.

After you've done a little homework, you can start understanding your own finances. Start with your bills. You need to not only know how to read them and pay them, but also what they mean to you financially. Make a list of your current financial responsibilities -- what you owe, who you owe and your interest and payment amounts. Add to this list all of your expected financial liabilites, such as increases in insurance premiums or a new home purchase. Add in your daily expenses, such as food and gas money.

You've now completed the first step in your own personal family budget. This will be your blueprint of how you will spend and save. Add up all of your monthly income. Subtract your expenses you have listed from your income. The results should be a positive number. If it isn't, you are spending more than you make. You need to find places to cut back so that you don't fall further and further behind.

Many children believe that credit cards are a magic way to get what they want. They will buy everything. Adults should know better. Credit cards need to be paid off. This is your top priority -- you have to get out of debt. Don't charge anything that you can't pay back at the end of the month. If you can't resist the card, put it in your safety deposit box. You won't use it on impulse if it is hard to get to.

Saturday, February 19, 2011

Don't Be Held Hostage By The Price Of Gasoline

It seems everywhere you go these days, at least in the US, the conversations are about the price of gasoline.

No wonder, since it's broken the $3.00 a gallon barrier and is causing a lot of people real hardships.

I'm old enough to remember the gas lines of the 1970's when a similar situation occurred. At that time, I had a production services company in New England, in partnership with a man named, Irving Goldmacher.

In addition to being one of the two smartest people I've known - my wife, Georgia, being the other - Irving was a fascinating person. I could probably write a book about him.

One day, in the midst of soaring gas prices, Irving went out and bought a new Caddilac, a car that was known to have low gas mileage.

I asked him if he had lost his mind, buying a gas guzzling car when gas prices were at an all time high.

"James," he answered, "if the price of gas goes up, I'll just figure out how to make more money. I'm not going to live my life worrying about the price of gasoline."

Talk about a prosperity mindset! What a great outlook. Irving knew he was capable of creating whatever income he wanted, no matter what was going on around him.

This is the real key to living a prosperous life. Be in control of your income.

First, realize that your income comes from God and is not dependent on the economy. If you believe otherwise, you're in for a challenging time.

Then, develop additional streams of income to supplement whatever else you're doing. If you have a job, this might mean starting a part-time business.

If you're already in business, it may mean adding new revenue streams to your existing products or services. Whatever your path, it is crucial to have more than one channel of income.

For a list of resources to help you increase your income, visit

Friday, February 18, 2011

Don't Be A Victim Of Identity Theft

Just about everybody has heard of identity theft, but most people do not believe it could ever happen to them. The fact is, identity theft is more common than most believe. It's not hard for identity thieves to obtain all of the information they need in order to assume another person's identity, but it can be made a whole lot harder for them if people remain smart and protect themselves as completely as possible.

When it Happens…

If a person becomes a victim of identity theft, it can take a long time - possibly years - to recover from it. It can also cost the victim thousands of dollars as well as ruin their credit score. Usually, it's nearly impossible to recover from identity theft in a quick manner because many things have to be resolved before forgiveness will be given by the three major credit reporting companies in the United States.

If identity theft does happen, the person who is the victim will probably experience problems obtaining any sort of financing (mortgage, car loan, student loan, credit cards, etc…). And, the worst thing that can happen is that the victim of identity theft can even get arrested for crimes he or she did not commit.

All of the results of being a victim of identity theft are not fair, and are very difficult to resolve. Being a victim can be a real headache and can basically interrupt or stall an innocent person's life for several years. So, the best possible thing is to do is to try and do anything and everything to prevent becoming a victim in the first place.

Protect Personal Information

The easiest way for identity thieves can assume another person's identity is to obtain personal information from a potential victim and use that information to fill out loan or credit card applications.

While most victims do not offer thieves their personal information, they are not aware that their information is contained on many documents that they have not disposed of properly. For example, thieves have been known to go through people's trash cans looking for personal information. When papers are thrown away without being shredded, thieves can retrieve the information and use it.

Thieves are also known to go through people's mailboxes to obtain in-coming letters from banks and/or credit card applications and use the data from these various pieces of mail to apply for loans or credit with the stolen information.

In-coming mail is not the only source of mail-related information that thieves can acquire. Out-going mail that is placed in a person's mailbox for the mailman to pick up and take to the post office is a great source of information for thieves. When a flag is placed in the upright position on a mailbox to indicate that letters are inside waiting to be mailed, it's like a signal to thieves that they should come on over and steal it. Therefore, letters should always be mailed in a post office mailbox instead of a personal/home mailbox.

Other Ways to Prevent Identity Theft

It's not difficult to perform some easy steps to prevent being a victim of identity theft. In addition to properly disposing of paper containing personal information and mailing letters at the post office, following are some additional tips:

• Always destroy receipts, credit card applications, tax information, canceled checks, and mortgage information before throwing it away. This means completely shredding it or even burning it before it reaches the trash can.

• Even if a credit card is expired, cut it into tiny little pieces before throwing it away. Some people throw half of the tiny pieces into one trash bag and half into another trash bag.

• Report stolen credit cards immediately to credit card companies. Don't wait an entire day… do it the minute they're discovered to be missing.

• Monitor credit reports on a regular basis, and watch for anything suspicious. If anything out of the ordinary appears, investigate it right away.

Thursday, February 17, 2011

Does the American government see its citizens as its children?

In Americas 230 year history the government seems to have forgotten that there job is to run the government as the people see as best and not the government telling the people what is best for them.

The most recent example is the Internet gambling Ban signed into law last week by President Bush. The bill makes it illegal for banks and credit card companies to transfer money to casinos for the purpose of wagering on sports or games of chance, like roulette, blackjack and poker.

These games are harmlessly enjoyed regularly by millions of Americans everyday, but some people become addicted to these games so the government is telling all of its citizens that no one is allowed to play these games in an online casino.

This is not the first case of the government going against the wishes of the people, in the early 1900’s the government decided that the consumption of Alcohol should be banned, because some people were developing health and mental problems related to drinking too much. So rather then educating the people on the ill effects of prolonged Alcohol abuse the American government banned Alcohol.

But instead of reducing the consumption of Alcoholic beverages it increased, and because the government was not allowing the production or importing of Alcohol, organized grime got into the moonshine business, and eventually the Government saw the error of their decision and repealed the law.

Another great example of a failed policy to protect the people is the war on drugs that the government has been aging since the early 1980’s Billions of tax dollars a year goes into the war on drugs, but what are the results?

The price of drugs has risen, and to support their habits many drug addicts have had to commit acts of robbery and murder to get their drugs.

The American prisons are packed full of people whose only crime was possession of these illegal drugs.

Instead of being an industry that is regulated and controlled you have people selling these drugs to kids in school playgrounds, and shooting each other to protect their territory.

Had the government decided not to criminalize drugs but make it a heavily controlled industry, they could use the tax money for social programs like schools ad to give Americans universal health care.

Please do not misunderstand me I am not in favor for legalizing hard drugs, but the current system is not working at all, but I am all in favor for legalizing online casino gambling.

If I choose to play some hands of blackjack or poker from the comfort of my home what rights does the government have to tell me not to, and what sense does it make that I can not play in a casino over the internet, but I can drive down the street to the local casino and play there.

To enforce this ban millions if not billions of dollars of software and computer hardware will be needed to monitor all of the banks transactions and that money will come from taxes instead of the government taxing online casinos or even having all the online casinos government controlled then they get all the profits to be used to improve the lives of the American citizens, millions of which are bellow the poverty line if not homeless.

The American government needs to start re-thinking its policy of treating its citizens like small children, or the American people need to demand a new government.

Wednesday, February 16, 2011

Does Paying Points on a Mortgage Make Sense?

You've found your dream home and are now ready to start shopping for a mortgage. Several lenders have talked about points. You've heard that paying points is the only way to get a low interest rate. But is increasing your initial costs worth getting a lower rate?

For most people, paying points doesn't make sense. Points, also called discount points or origination fees, are each worth one percent of the loan amount. They are paid to the lender at closing.

Paying points basically allows the borrower to buy down the interest rate.

Points became popular in the early 1980s when mortgage rates were in excess of 15%. Most people could not afford the monthly payments that come with such high interest rates. Lenders began offering discounted rates at a certain fee. Sellers often paid the points in order to sell their properties. This gave buyers affordable mortgages and owners were able to sell their homes.

Times are different now. Interest rates are reasonable. There isn't a large need to pay a lot of money up front in order to get a lower rate.

Let's look at the numbers. You have contracted to purchase a home for $240,000. You have the 20% down, which leaves you with a mortgage of $192,000.

You find a 30-year fixed rate mortgage at 6.5% with two points. For closing, you will need to pay $3,840 ($192,000 x 2%) for the points.

The lender can also offer you a rate of 7% with no points.

What do you choose? The lower rate or the lower closing?

At 6.5% you will have a monthly principal and interest payment of $1,207. At 7% your payment increases to $1,270 each month. That's a difference of $63 per month. If you are looking for a monthly payment reduction, it's not really a significant one.

It will take you 61 months ($3,840 divided by $63) to recoup your points payment in the form of a lower payment. This is your payback period. But if you had the $3,840 still, it could be earning interest in the bank. If it gets 3% interest in the bank, it would earn about $10 per month. If you pay points, this is interest lost, so subtract $10 from your $63 per month savings. Now divide $53 into $3,840, and your payback period increases to 72 months -- six years.

So you have to live in your home for at least six years in order to take advantage of the savings that paying points gives you. Most people don't keep a mortgage for six years. Unless you are absolutely sure you will live in the home for the time period necessary to recoup your points, you should probably invest your money instead of putting towards points.

If you are looking at paying points in order to reduce your monthly housing payment, you may want to look at a less expensive property. Sixty dollars worth of savings isn't a lot if you have a tight budget. Chances are that if you have a tight budget to start with, finding extra money for closing would be difficult. And don't forget, taking out a side loan to get the money to pay points with is defeating the purpose.

Tuesday, February 15, 2011

Do You Know How Cash Back Credit Cards Work?

The popularity of cash back credit cards hasn't waned over the years. In fact, today, more and more people still prefer a cash back credit card over other reward credit cards programs. Do you own a cash back card yourself? Or are you still thinking about applying your own cash back card? Whether you already have a cash back card or is still planning on getting one, this article would surely be useful for you. Let's discuss more closely how these reward credit cards work.

How Cash Back Credit Cards Reward Holders

Although specific terms and conditions vary between each credit card issuer, the procedure on earning the cash rewards is pretty much the same. Generally, a card holder earns a corresponding point for every dollar he spent using his credit card. Some credit card issuers give 2 points or double points for every dollar but in most cases, 1 point is given for each dollar amount charged on the card. The points are converted to cash or money points, thus their name- cash back credit cards.

What can you do with the cash points you earn? You can use these cash points to make new purchases or pay bills using your credit card. Some credit cards would require the holder to spend his reward from a specific shop while others give the flexibility to use your cash rewards from any store you want.Discover® Gas CardSome cash back cards impose a maximum amount of cash points that the card holder can earn. After reaching this limit, the card holder may stop qualifying for more points. The best cash back credit cards however do not impose restrictions on the amount of rewards you can earn. As long as you're using credit card on your payments, you continuously earn points on your account. You can earn as much cash as you want as long as you're an active member of the reward program.

Competition among credit cards

Cash back credit card companies are all competing for attention and in order to get more clients, these companies promise only the best. Or course, not everyone deserves your trust. For this reason, caution is advised for everyone who plans on applying for a reward credit card.

Most reward credit cards are accompanied with unreasonably high interest rates but if you do your research, you can find one that offers a good deal. When it comes to annual fees, you can now find cash back reward cards that do not have annual fees. If the cash back card you choose requires an annual fee, you'll want to make sure that the cost does not outweigh your potential to earn rewards. If you'll be paying for an expensive annual fee each year, then can you still say that you are being rewarded? Or would you end up paying more than what you get back?

Lastly, cash back credit cards will only work if you keep up with your payments religiously. Never carry over your balance for the next billing cycle if you don't want to suffer paying for an expensive interest rate. Make it a point to pay off your balance in full each month so make sure that you will be rewarded.

Monday, February 14, 2011

Do You Know About Money?

In a test of basic economic principles given to 2000 Americans, both adults and teenagers, the average grade was failing. Throughout the years, it has been proven by numerous studies that when high schoolers graduate, they leave with little understanding of personal finances.

I was never taught how to count back change, balance a checking account or understand compounding interest. But yet, I graduated with the highest math honors, having tackled calculus and physics courses at the neighboring college. But at no point, was I taught the basics of finances before I entered college. Nor were many other American teenagers.

And now credit card debt and financial troubles seem to be everywhere. It is surprising how many people don't really understand their finances. For example, one of my close friends recently told me that her credit cards had great rates once the 0% interest expires. I told her that her rates can go up at any time, but she didn't believe me.

So what do you and your children need to know about money?

You need to understand the basics of how to balance your checking and how to budget your income. These two practices will keep you financially grounded. If you can balance your account and stay within your budget, you are probably doing well.

What can throw you off track is debt. And it is coming at you from all sides. You need to understand that there is good debt and bad debt, but that debt becomes fatal if you can't afford what you have racked up. For example, having a home mortgage is good debt. But if you can't afford the mortgage payment and risk defaulting on the loan, there is no good in it.

You have to know how debt works. Understand the advantages and disadvantages to using your credit. If you have or are thinking about taking out a credit card, I suggest that you learn all of the tricks of the trade. I would say that the one thing to remember is that debt costs you. All debt costs you. Credit cards, auto loans, mortgages and student loans aren't designed for your good. They are there to make the lenders money. Keep that in mind.

When you are thinking about taking out a loan, you should do main things:

Know your credit score and what your credit report says. Figure out the total cost of the loan. This includes all of the interest you will have to pay back. The number might surprise you. See how long it would take you to save for it versus paying off the loan. Shop around for the best interest rates and terms.

One of the most important things is understanding compounding interest. This can be slightly hard to get a grip on at first, so have someone show you how the numbers work. And keep in mind that though interest can cost you in debt, it can give to you in savings.

Finally, you need to understand that as an adult, there is more to finances than just money. It is about self-control, trust and other emotions. There are also many facets to managing your finances. You have insurance policies, investments and wills and trusts to consider. It's all about making the best future for you and your family. That's what money spent wisely can do for you. Take the few hours to learn how to get there. It will pay you back thousands and thousands of times.

Sunday, February 13, 2011

Do you have good posture?

When I started saving, I wasn’t saving much. However, I developed an important habit. Whether you’ve wisely saved money or received a good tax return, don’t go out and blow it on more stuff. You can have anything you want, you just can’t have everything you want. A.F. Bannerman once shared wise advice worth mentioning here that I’ve come to agree with and respect:

“Your savings affect the way you stand, the way you walk, the tone of your voice. In short, your physical well being and self confidence. A person without savings is always running. You must take the first job offer. You sit nervously on life’s chairs because any of life’s emergencies throws you into the hands of others. Without savings, a person is often fearful of the present and the future. Being in a state of constant fear is a horrible place to live. A person with savings can walk tall. You can appraise opportunities in a relaxed way, have time for judicious estimates and decisions. You need not be rushed by life’s problems or economic necessity. The person with savings can resign from his work if his principles tell him this is not the place to be. "

The person who is always worried about rent, food, bills, etc. can’t concentrate on long-range career goals. The person with savings can focus on family and service to shape personality and develop character.

2 practical tips to get started:
Track everything you spend. When you keep a log of everything you spend (gum, gas, latte, groceries, everything), you can’t help but see patterns in your spending. You’ll think twice before buying that next Starbucks. If you live on a budget for every category of expenses you have, you’ll be amazed at the control you gain over spending.

Savings is actually delayed spending. I didn’t understand the expression “pay yourself first,” until my mid-30s. It means you should set aside a portion of everything you make, save it, then invest it. You should do this regardless of whether or not you have your own business (hopefully you do).

Saturday, February 12, 2011

Do You Bank Online?

If you haven’t made it to the world of options offered in bank-online fields, the fact is that you should be. Yes, there are many opportunities for you to walk into a teller and get your information taken care of. But when do you pay bills? Do you do it in the middle of the night, usually the night before it is due? If this is the case, you may want to consider the options of bank-online to simply give you the opportunity to make those payments on time. Why should you bank-online?

There are many reasons but most of them have to do with the ease of use. You can find yourself saving time and money by getting your work done on the web. You can bank whenever you like. You can check your balance well before the bank opens. You can actually see it as well, not just hear the information but see who is taking money from your account. It is quite simple to use and that too adds to the ease and convenience of bank-online options.

What is also great about it is that it can help you to set up bill payments on the web as well. This means that you go into your account, tell it the day you need to pay the bill, the amount and who to send it to and it takes care of the rest. If nothing else, it saves you the postage stamp! Likewise, you will find that it also provides you with a way to automatically handle those bills so that you are not late anymore. And, it can help you to track your spending and savings because most of the banks that off bank-online options do so by providing you with a way to connect to your banking software as well. This means organization! See what opportunities you have in bank-online through your financial institution.

Friday, February 11, 2011

Do We Really Live In An Electronic Age?

I decided to transfer funds from one pension plan to another. I had a 401(K) that I converted to an IRA when I left the private sector and went to work for the government.

The government's version of a 401(K) is called a TSP – Thrift Savings Program.

I decided to make the transfer and went to the TSP web site. I was able to download the required form, so that part was electronic.

Then I had to fill it out by hand and send it Fidelity via snail mail. About one week later, I received a letter in the postal mail from Fidelity stating they had tried to contact me by phone to resolve an issue and they were unable to contact me. This was pure BS as both my work and cell phone have voice mail.

I called Fidelity and the problem was they did not know how much I wanted transferred even though I indicated "all". I was given an assurance that it would be taken care of. I told them to make sure that they filled out the proper section on the form and submit it to the TSP office.

About one week goes by and I receive a letter from TSP, again snail mail, that they have received the check, but do not have the proper transfer form from Fidelity. Without the form, they will send the check back to Fidelity in 15 days.

I once again call Fidelity and am told that the check is sent from one office and the form is sent from another. It doesn’t make sense, but it is there system.

One week later, another letter from Fidelity is received stating that the form has been sent.

I call the TSP office to find out if the check and the form have found each other and no joy. I am told it could take 7 to 10 business days for the two to find each other.

Another week passes, and I call and I am informed that the check and form are back together in a lock box. I guess that this is a good thing and keep my fingers crossed that the money will actually be posted to my account.

Four days later, I see the additional funds in my account. Hooray!

So, for about 3 ½ weeks, my funds were in limbo gaining interest for either Fidelity or the government at TSP.

Fortunately, the stock market didn’t go up or down much during this period, so the value was not really affected. However, it could have been.
It is strange to me that I can transfer funds online from my checking to savings in a matter of seconds. I can transfer funds via email using PayPal for free in a couple of days.

But, if I want to transfer funds from a mega-investing company like Fidelity to one of the biggest pension funds in the world, I have to do via the post office and wait almost one month for the transaction to be finalized.

Electronic age, my eye!

Thursday, February 10, 2011

Do We Need To Refinance?

There are plenty of reasons why people chose to refinance. The needs for home improvements, sending a child to college or simply lower their monthly mortgage are a few. You need to find a loan company that offers you the best rate when you chose to refinance. Comparison-shopping is a wise thing to do before you refinance.

With the rising cost in college tuition choosing to refinance is becoming more popular. No one wants to deny sending their child of to college to better their education and become successful in life. This is why people look into refinancing their home or mortgage. There are a few different options, consulting a loan specialist would better help you decide which option is for you.

Another reason people chose to refinance is to lower there monthly mortgage payments or interest. This allows them more room to breathe when coming up with the money to pay for your mortgage or interest. When you chose to refinance it is also a way to get money to make improvements to your home.

You could just want to pay off your car loan. That is another reason that you would decide refinancing is right for you. Knock out that monthly payment and focus on other expenses. If you don't already have a car you would use the money to purchase one. Either for yourself or as a gift for your high school graduate.

A very popular reason that you would choose to refinance with a loan is debt consolidation. Pay off accumulated debts, such as credit card or medical bills. This reason may be increasing in the near future with the new bankruptcy law soon to go into effect. It gets rid of the frustration of bill collectors calling and mailing your home. It is an uncomfortable thing to deal with debt and no one likes to stress over bills that they can't pay. So choosing to refinance to knock out those bills is a wise step to take. This will also help you to improve your credit rating.

You may not even be concerned with any of the above reasons. You could just be looking for a way to take a family vacation or some kind of long awaited trip. Whatever your reason there is no wrong reason if you chose to refinance with a loan. As long as it is something that will benefit you and paying it back will not be a hassle.

There are plenty of competitors that will offer you a chance to refinance for what ever your reasons may be. Look for them on the Internet or call around and compare quotes. Some lenders will even match the lowest quote you can find.

Tuesday, February 8, 2011

Do Commodities Belong In Your Portfolio?

commodities, portfolio, diversification, oil, gold, hedge, china, india, alternative
Copyright 2006 Rafael Velez

Although it may sound frightening and risky to many investors, if handled correctly, commodities could be the missing piece of an investor’s portfolio. What exactly are commodities? Commodities are any mass goods traded on an exchange or in a cash market including: cocoa, coffee, eggs, lumber, orange juice, soybeans and sugar just to name a few. Industrial metals are also included with copper, aluminum, zinc, nickel, silver, and lead ranking among the most popular industrial metals holdings. Finally, the most widely followed commodities include oil, natural gas and gold.

The diversification benefits equal or surpass those of other asset classes like fixed income and real estate. The primary reason for this is their correlation, or lack thereof, to the stock market as represented by the S&P 500 (Correlation describes how similar the price movement is between two investments). Commodities have historically exhibited absolutely no correlation to the stock market or any of the bond market indices. In fact, they have a negative correlation. This non-similar pattern of performance allows an investor to minimize volatility and protect capital in down markets. Overall, these factors help to decrease overall risk in a portfolio of investments. In short, commodities have historically been a good compliment to a traditional stock, bond and real estate portfolio.

When commodities are utilized as a stand-alone investment, commodities are relatively volatile, exhibiting wild price swings. At times, they are also illiquid, prohibiting the investor from exiting a position that is dropping rapidly. Another factor to be aware of when investing in commodities is the unusual income taxation. Most notably, investors are taxed each year on their share of the profits, if there are profits, regardless of whether the investment has been sold. This is a significant disadvantage compared to investments in stocks, because one does not pay income taxes until the stock is actually sold. Finally, fees to implement a commodities strategy are significantly higher than for those of traditional mutual funds, for example. For these reasons, it is best to only consider 5-20% of one’s portfolio for this strategy.

At a time when stocks and bonds are predicted by most academics and investment gurus such as Warren Buffet, Bill Gross of PIMCO, and Jeremy Grantham of Grantham, Mayer, and Van Otterloo, to produce 5.0% returns or less over the next decade due to historically high market valuations. On a historical basis, commodities are inexpensively priced and substantial upside potential is possible. U.S. inflation is historically low right now but with the effects of massive fiscal, monetary policy and already robust consumer spending, raw goods prices will inevitably increase. When they do, commodity indices will follow. As inflation gradually rises in 2006 and beyond, industrial metals prices will rise as investors begin to direct large amounts of money into these hard asset commodities. The high correlation between commodities and inflation provide an important hedge against considerable losses in traditional financial instruments such as stocks and bonds.

In his recent book “Hot Commodities”, author and renowned investor Jim Rogers summed it up this way:

The 1980’s and 1990’s saw a bear market in commodities. Prices had fallen to levels (adjusted for inflation) not seen since the Great Depression.

For 130 years, stocks and commodities have alternated leadership in regular cycles averaging 18 years.

The long bear market in commodities has created a sharp reduction in capacity – and thus large supply-and-demand imbalances.

As economies in Asia continue to grow, there will be a strong worldwide demand for all commodities.

Historically, the prices of commodities show a negative correlation to the prices moves of stocks, bonds and other financial instruments.

Commodity prices can rise even when the economy is stuck in reverse and their returns outpace inflation.

The U.S. Federal Reserve and other banks in the world have been pursuing a policy of debasing their paper currencies.

The U.S. Federal Reserve’s policy of monetary stimulus and rapid credit expansion will continue to push up the prices of hard assets such as precious metals and other commodities.

History shows that war and political chaos only push commodities prices higher.

Commodities also provide a tactical play on the current weakness in the U.S. Dollar. As other currencies such as the Euro and Yen appreciate versus the dollar, foreign buyers can buy less goods with the same amount of currency. This artificially increases demand, and subsequently drives up the prices of commodities. Currently, effects of this phenomenon can be seen best in the gold and silver markets as prices have risen dramatically over the past year.

Commodities provide a play on globalization by their ability to aid in the improvement of the global economy. This is due to the fact that prices for industrial materials will increase as demand for industrial goods increase. As countries such as China and other emerging market economies develop, they will require more raw materials. This is especially true for industrial metals. China continues to develop at a rapid pace and consequently, their demand for raw materials continues to rise. In fact, China’s iron ore demand has increased from 5% of the world’s supply to almost 50% over the past twelve years.

Commodities have proven to be excellent investments over the last few years. There are a number of types of investment vehicles to take advantage of this great diversification play. Many of our client portfolios have benefited from this recent performance. With only small allocations to hard assets, most client portfolios have delivered returns that were twice the performance of traditional stock and bond portfolios.

Many experts agree that U.S. stocks and bonds will, in all likelihood, generate significantly lower returns over the next decade. Commodities on the other hand may have the potential for the highest returns since the 1970s due to a worldwide economic expansion especially from emerging market countries.

Monday, February 7, 2011

Divorced And Deep In Debt, It's Not All Doom And Gloom!

Almost half the letters I receive daily are from recent divorcees and for the most part their stories go something like this!

“The cost of my recent divorce has eaten up almost all of my 401(k) and I have been left deep in debt. I still own a home, although there is no equity left in it. I recently made the mistake of leasing a new car with insurance and lease payments that are the size of my house mortgage. I'm still employed, have a pension plan, am making about $60,000 a year, but have to make child support payments. I now need to start over, but don't know where to begin. Can you please give some direction, as I feel I'm going around in circles.”

As you can see, most sound like a parody for a country music song. The only thing missing is the dog running away. Now let’s focus on the positive side and there's always a positive side. You still have a job. You’re making a pretty good salary and if you're really willing to make a concerted effort, you most certainly will be able to rebuild your finances and regain some financial security.


Set Yourself A Budget You Can Live With:

Sit down and write out all your expenses, also list your priorities. You should start by figuring out how much you've got to spend on essentials. This would include home loan/rent, food, utilities, health insurance, car note payments and most definitely, those child support payments. Now it's time to start looking at ways to cut back. Do you really need premium cable? Do you really need to eat out as often as you do? Brownbag it a few days a week at work? If you really want a fresh start, you'll identify some ways to scale back your lifestyle.

Start A Savings And Investing Program:

Once you've got a handle on your budget, you really need to focus on rebuilding your wealth. It's my experience that the best way to do this is to make arrangements for the money to go directly from your paycheck or checking account into some sort of investment account. This ensures that the funds actually end up in savings rather than being diverted into some purchase or another that always seems like a good idea at the time. To use a familiar term, “investing for our long term future is a marathon not a sprint” please do not put it off until tomorrow because, “Tomorrow Never Comes”.

Stay Positive:

If history is any guide, one of the biggest dangers to recent divorcees is that the combination of emotional and financial stress caused by the breakup of a marriage can be so overwhelming that it leads most people into a sense of hopelessness, a feeling that you've fallen into a hole so deep, you'll never be able to claw your way out. That's understandable but you need to remember one thing, the only person who can change your life is YOU. That’s why it's very important that you begin taking action now! Don't procrastinate on that budget and starting that savings program today! The moment you see things beginning to look up a little, you'll start to regain a sense of control over your life.

Once that happens, your life can begin to seem less like one of those heartbreaking country music songs and more like that famous track on the 'The Beatles' Sgt. Pepper album - "It's Getting Better All The Time."

Have an opinion or a question you would like me to answer, then write me!

Sunday, February 6, 2011

Disposable Income Figures Show Gap Narrowing

The research from KBD has also revealed the full extent of the north-south financial divide.

Taking the UK as a whole, the typical household has some £40,000 of disposable wealth, but this figure oscillates wildly depending on where you look – and indeed where you live.

An average London family will possess £81,732 in readily-accessible cash, while the Midlands sees this figure reduced to £31,939 and Scots find themselves cut somewhat adrift with a typical £29,724 waiting to be spent.

The gap, however, is closing – the Scottish figure was in fact a 35 per cent increase on that of 12 months ago while north-westerners and the Welsh, with 32 per cent and 31 per cent rises respectively, also saw notable and much-welcomed rises.

London may top the charts, but its disposable income figure has only escalated by two per cent, while usually-affluent south-westerners only saw a seven per cent appreciation.

Matt Boot, chief analyst at KDB, commented on some of the factors behind these fresh figures.

He said: "Early signs in 2006 show an upturn in housing values along with continued stock market growth, and this has swelled the amount that households can really lay their hands on.

"Although absolute disposable wealth levels per household still show a marked north-south divide, the gap is closing, and the smart money for growth is in the Midlands and above."

This is heartening news for many Brits – but also indicative of how volatile and changeable such figures can be, with many variables lying behind them. In turn, this shows how carefully-laid spending and saving plans can change due to a variety of factors, be they economic or personal.

Therefore the role of a payday loan ( ) becomes clear. If at some point you find that you do not have quite as much available cash as you had budgeted for – perhaps if some inconvenient extra expenses have come your way or if a special occasion has arisen which urgently needs catering for – then some short-term cash might be invaluable to offset any problems this may cause.

A sum of between £80 and £1,000 can help you foot the bill for that one-off event or occasion, or can buy you time to readjust to changing circumstances. The short term loan is repayable at a convenient time – your next payday – and harbours no extra charges ( ) or caveats save for the explicitly-stated repayment rate of £25 for every £100 borrowed.

My Payday Loan is a leading provider of this service and a reputable one – customers are assured that the additions to their disposable income that they require will typically be in their bank accounts within 24 hours.

Saturday, February 5, 2011

Discover What to do When Your Credit Worth is Damaged

The good thing about bad credit is that you can fix it. If you start now, over time, your bad credit can turn into good credit, and you could qualify for the loans you want at the rates you want. The most important aspect of rebuilding your credit after it has been damaged is showing lenders and creditors that you are serious about repaying your debt and that you can be a reliable borrower over a significant period of time.

Negative account histories remain on your credit report for up to 7 to 10 years, depending on the type of action. Bankruptcy can stay on your report for up to 10 years, and collections drop off after 7 years.

Advice varies widely as to the best methods to rebuild your credit. Some points most experts agree on include:

• Starting small - Don't be intimidated by large debt amounts. Even small payments, made on a regular basis, will improve your payment history and, eventually, your credit score.
• Spending less than you earn - Borrowing money to finance a lifestyle that is beyond your means will only land you deeper in debt.
• Paying your bills on time - Building credibility as a borrower involves meeting your commitments to pay, early if possible.
• Keeping your balances low - When using your healthier or newer accounts, keep the balance that you owe between 25% and 50% of your line of credit. An average of 30% is suggested.
• If your credit is damaged and you need more information about the three major credit bureaus, go to

Other tips might not seem related to your credit score. Staying at least two years on the same job demonstrates steady employment, and you appear more stable to lenders. You can also open an emergency savings account. Contribute to the account a little at a time on a regular basis. This will not only appear as positive activity to lenders, but also will serve as reserve money to keep you from charging unexpected expenses. Finally, stop borrowing for a while. Certainly avoid borrowing more money from home equity or other lines of credit to pay off credit card debt. Shuffling the debt does not make it disappear.

When establishing new credit, it may be necessary at some point to open a new account once you have paid down your existing ones. Credit unions usually offer the best deals to people with damaged credit. If you are unable to qualify for a credit card, try a smaller company, such as a department store or gas station that might offer you a line of credit.

You may want to look into getting a secured credit card. Offered by several banks and credit unions, secured credit cards are a positive way to show lenders that you can pay bills on time and be trusted with credit. To use a secured credit card, you will deposit a sum of money into a savings account and pay a small yearly fee to the institution offering the card. If you deposit $500, you will have a line of credit up to $500. Using your card on a regular basis and paying it off monthly in full could lead to a traditional line of credit. Once the bank or credit union sees that you are capable of maintaining your secured account, they may extend an offer to you with a fair interest rate.

Another option is to have a friend or relative co-sign for a line of credit with you. This step is risky because you are not only gambling with your loved one's good credit, but also with their good faith.

After a few months of good behavior, order copies of your credit report from all three credit agencies and check for improvements or errors. Be sure that negative information that you have remedied has been removed. File any complaints in writing and check your report again in a few months to ensure that the changes have been made.

Repairing damaged credit is time-consuming but well worth it, both to your peace of mind and to your pocketbook. For more information about credit reports, you can visit

Friday, February 4, 2011

Discover The Value Of Canny Mortgage Research

You hear people griping about the cost of consumer products these days. The socialist-student-worker-miser believes capitalism is inherently wicked. Someone is out to screw him. The truth is 'yes', someone is out to screw you, and will, but only if you let them. They're not obliged to get you the best deal, and you're not obliged to take the first deal they offer. Don't let your greed for a mortgage override your good sense. If a deal seems too good to be true, it probably is.

Start with banks and well known credit unions. When you begin to research, it's best to start with your current bank, or with large credit unions. These have solid reputations. You may not get the best rate with a large bank, but the security can be worth it.

If you're in the UK, see if the company is a member of the Finance Industry Standards Association (FISA) and registered under the Data Protection Act (DPA).

A mortgage is an agreement between a borrower and a lender. Determine first what type you're looking for: fixed rate, variable rate, capped, buy-to-let, bad credit, self-certification, and proceed from there. This will cut down your research time.

There's no need to apply all over the shop. Try for one from a high street bank, a high street building society, a credit union, an independent loan company and an internet-based one. The trick is to weed out the high interest rates and fees at one end, and the cubicle farm operations at the other. The latter won't give two straws if you get into financial difficulties. If your application to a good 'un gets rejected, shrug it off and move onto the next best option.

Ensure that you think about your budget. No matter how cheap your deal may be, pay it off as quickly as you can to avoid interest piling up.

However, it's important not to overstretch yourself. Save a portion of your regular monthly income as cover for emergencies and unexpected bills.

In order to give you their best mortgage quote, the intermediary you apply to will need at least your:

- Name;
- Address (with post code);
- Time at that address;
- Amount you want to borrow;
- Employment (how long in your current job);
- If you have a bank account (and how long you've had it).

You may have to get used to the idea of getting cold calls from other lenders for weeks or months afterwards. Try to halt this by telling the initial broker "Please do not sell or pass my personal data on to other companies. Thank you."

Independent mortgage information is hard to come by. Everyone is looking to make a few quid, especially when it comes to financial products. It's a big business; lots of money to be made from needy people.

Many sites which seem to be independent are tied in with established lenders. They can't give unbiased information. If it's a financial product, chances are most sites that come up in a search engines' first and second pages are tied to one of the larger large lending companies.

Thursday, February 3, 2011

Discover The Many Facets of Finances

The finance of a business is its lifeblood without which there is no point in putting up or maintaining one. At the end of the day, money is what matters in any kind of business and that is an established fact. Most of us know how elaborate money matters are. Loosely translated, that means dealing with finances is a pain. This is especially true for people who don’t know the first thing about it and I believe that comprises majority of the population.

Mortgages, trusts, annuities, bonds and brokers are only a few of the facets of finances. If that doesn’t make you cringe, the likes of auditing and secured loans will. I’m tempted to say that rocket science would be easier to understand. Although I know that is not true, they do share an element of difficulty that the ordinary layperson would be hard pressed to comprehend. It would be grand if we didn’t have to deal with finances. But just like death and taxes, we are sure to deal with money matters in the course of our lives.

Going back to business and its financial aspect, who or where do you go to in order to get the much needed help? I presume financial advisers or accountants would be the first people that we’d think of. But which financial adviser do we approach? What do we say when we get hold of one? Would they know what to do with our specific need immediately? The only logical thing to do would be to employ a skill that we have acquired way back in elementary school: research.

The Internet is always a good place to start when doing research. Business and financial sites are abundant in the net, you just have to sift through to find the good ones and ignore the irrelevant sites. The way to go would be to look for a good business portal. Portals are basically sites with a collection of topics or subjects that acts as a launch pad. This will enable you to spring to several sites that contain pertinent information about the subject that you are interested in. The apparent advantage when using a portal is that all the data and information that has to do with what you are looking for is already within reach.

You don’t have to go to a search engine to look for a subject within the same topic. Take for example a business or financial portal. I’ve mentioned about where to find good accountants earlier, here’s the place. The obvious link to click on would be “accountants” in the portal. Details like services an accountant offers and how to pick the right one for your needs are discussed in-depth. After you’re satisfied with the information you’ve gathered, you can simply go back to the portal and select another link that you might also be interested in like maybe loans or insurance and do the same thing again. That’s how convenient it is to use a business or financial portal. Information is indispensable in the realm of business. Find the right portal and get on the road to financial success.

Wednesday, February 2, 2011

Discover Card's Business Credit Cards

Discover Card now offers its own version of business credit cards. Discover Card has been known for their customer service, and this dedication for service continues in their business credit cards product. Whenever you need to contact them, Discover Card assures you that business credit card specialists will always be on hand, that they will take your telephone calls quickly and that your queries will be attended to promptly. Discover does not treat this availability as a benefit, but rather view it as a service commitment to their Discover Card business customers. There is a wide range of benefits to be had on your Discover business credit cards though. Here follows a few of these:

Cash Back Bonus Business Credit Cards
Using your Discover Rewards business credit card, will entitle you to 5% discounts on office supply purchases, 2% on gas, and 1% on other miscellaneous purchases. This could translate into significant savings for your business, especially because this business credit card also enables you to earn valuable Rewards points

If you opt to redeem your business credit cards cash back bonus in the form of gift cards or e-certificates from their participating 70 brand-name partners, you will have the opportunity of doubling your points. This means that you can get gift cards or certificates to use for a variety of different items – and should that be your choice, even a Cruise.

If, on the other hand, you elect to redeem in cash, you can nominate how the payment should be issued and into which account it should go. This could be in the form of a check, an electronic deposit to the bank account of your choice, or as a credit on your business credit card account.

Travel Miles Business Credit Cards
If your business requires frequent travel, the Discover Miles Business Credit Cards will come in useful. Your business credit card account earns up to one mile for every dollar in usual purchases, double miles on your gas (at the pump or in the station) and double miles for travel purchases (plane tickets, car rentals, hotels). There is a limit of $5,000 imposed in terms of the amount you can accumulate on the business credit cards’ double miles feature, but when all is said and done, that is still a substantial amount.

You won’t have to wait long before you can start redeeming the miles on your business credit cards. You can redeem the miles as gift cards from 50 brand-name participating partners in a graduated manner: $5 for 1,000 miles, $25 for 3,500 miles and $50 for 6,000 miles. Once you reach 5,000 miles, you can start redeeming these miles as cash back rewards.

Other Benefits
There are also other, standard benefits for business credit cards. You will get quarterly and annual statements that summarize all expenses charged against your business credit cards; the summaries are already categorized to make your bookkeeping simpler, and you can receive statements online ready for download into popular accounting software applications.

You can customize your employees’ spending limits on their business credit cards online, and when you use your business credit card to pay for travel, you’re automatically covered for accident insurance and car rental insurance. A new benefit is that you can purchase checkbooks with your Discover business credit card, thereby enabling payments to those companies that don’t accept business credit cards yet.

Flipping Has Tax Consequences

If you are looking at making a quick hundred-thousand on real estate flipping, you may find it is quick, but not as lucrative as you thought. With housing prices on the rise across the nation, flipping has become the hottest investment trend. You buy a property and quickly resell it at a higher price. Most people even believe flipping to be more lucrative than the stock market. Plus, you get the rush of making a deal. Plus there is a physical object to look at to judge your investment by. But if you aren't careful when flipping that real estate, your investment strategy could be a party that the IRS attends. Bill Rucci of Rucci, Bardaro and Barrett says that many of today's real estate investors are completely uninformed when they begin their transactions. "There is a huge misconception on part of some people who think they can buy a residential home, not necessarily their personal residence, fix it up and sell it; and then get what we used to call the old rollover provisions, where you used the money you made to buy another property for more than what you sold," explained Rucci. But there are two problems with that approach. "One, that rule existed for personal residences only; and two, it doesn't exist anymore," he said. The rollover rule was replaced in 1997 with current law that allows for the tax-free sale of personal property in many cases. This works great if you are selling your primary residence after living in it for many years, but if you're selling a house you haven't lived in, your in a different group. The residence will be considered an investment property, and the tax considerations are completely different and more costly. "We have tens of thousands of people getting into real estate," says Mark Zilbert, a Realtor. "The majority of buyers understand that they can flip for a profit, understand what it means dollarwise, but they don't understand that taxes could reduce just how much of a profit they make." Instead of running a fast game, a tax-smart flipper could benefit from a slower investment pace. Investment profit, whether stocks or real estate, is considered capital gain and is taxed at two levels. The tax rate depends on how long you own the property. Keep it for less than a year and your short-term gains will be taxed as ordinary income. That means you could be facing up to 35%. If you hold the property longer than a year, you will pay a long-term capital gains rate that maxes out a 15% for most taxpayers. Not all flippers have a year to wait. Not even for taxes. But you must beware how much you flip. When you complete several transactions in a short time, the IRS could consider your transactions as a business rather than an investment strategy. Then you have to pay the higher ordinary income tax rates. The IRS is watching flippers closely. "The IRS is out looking for these transactions," says Rucci. "If the IRS decides your investment is a business; that what you are doing is to earn a living, the property changes from a capital asset to a means of producing income that's subject to ordinary tax rates, plus the additional burden of another 15.3% in self-employment taxes. That is what the government is pushing for." Tax costs won't deter many flippers. One way of looking at it is that you don't pay taxes unless you make money. The easiest way to pay less tax on a flip is using the capital-gains technique. Simply hold onto the property for more than a year and pay the long-term capital gains. You can try to time your real estate sale during the same tax year you suffer a loss on another long-term asset. Then use the loss to offset your gain. If you want to avoid taxes altogether on the property, simply move in. You must live there for two years out of the last five years. When you sell it, up to $250,000 of your profit is excluded from taxation, double that if you are married and file jointly. You can also defer paying taxes on your real estate gain by exchanging the property for another property, known as a like-kind or Section 1013 exchange. No matter what you do, make sure that you keep good records. You can really benefit from proper documentation when claiming real estate investment deductions.

Tuesday, February 1, 2011

Discover Business Card

The Discover Business Card is a card which you should consider using within your business when looking for a business credit card. You will want to find a card which can fit with your business needs. The Discover business card can be that card for you. This article will focus on a couple all of the different features which are available with the Discover Business Card which will be beneficial to your business.

The Discover Business Card offers you 12 months at 0% APR for balance transfer. If your business carries credit card debt, you could look at doing a balance transfer from one card to another. This would allow you to reduce the amount that you have to pay toward your credit card every month, thus freeing up monthly cash flow. You could also use the money that was put towards servicing your credit card debt interest to pay them off more quickly. This will help improve your business’s net worth as you pay down your credit card debts.

With the Discover Business Card, you can have cards issued for you as well as your employees. What is nice about this is that you can have a different amount and limits for different employees. Monthly statements can also be broken down so that employee’s spending can viewed more carefully to ensure that spending is within line with what is being reported by employees.

The number of merchants which will not accept business credit cards is declining every year but there are still many who do not accept a credit card. If you would like to use your credit card and pay these merchants, there are fee-free purchase checks which you can use to send to these merchants. This can once again helped you free up monthly cash flow since you can leave the money in the bank to earn more interest income until it must be paid on your credit card every month.

This article has talked about the benefits of using a Discover business card. Having 0% APR on balance transfers for 12 months can help you pay down high interest debt and also allow you to free a monthly cash flow. Being able to more carefully monitor employee spending as well as sending checks to merchants who don't accept credit cards can have benefits depending on the business that you are in. If you are thinking about a business credit card, this could be the card for you.

Filing For Bankruptcy Will No Longer Be An Easy Option

Most of us already are aware that the change in the bankruptcy law will be effective this October. Those who are already in debt argue that it is unfair. Companies that have suffered profit loss through the years are relieved to hear the news. The change in the bankruptcy law will force individuals who are in debt or facing debt to file for Chapter 13 bankruptcy. The old way of just erasing debt will no longer be an option to most. How does Chapter 13 bankruptcy work? Well it is a plan that arranges monthly payments of the debtor. The courts calculate what amounts the individual can pay on a monthly basis. Chapter 13 is available to anyone who has some kind of steady income allowing them to come up with money to pay off their debts. It does prevent the debtor from the need to liquidate any of their available assets. The individual does not decide what they can pay and when they can pay it off. The courts will calculate the payment arrangements and the time line in which the debts are to be paid off. Now that there is a new bankruptcy law people should plan better for the future to prevent their need to file as bankrupt. There are circumstances that most individuals do not account for when they invest into a home or use credit cards for purchases. One significant cause to debt is suffering some kind of financial loss such as losing a job or investments such as stocks. When this kind of situation occurs people are not equipment to pay their monthly payments such as mortgages leases and credit card bills. A wise thing to do is to be prepared for the unexpected. Save some money off to the side. Keep it in a separate account in case something that was to happen in the future that effects your income. Establishing any kind of financial plan is always a good move to avoid bankruptcy. There are things that happen that no one ever plans on that can lend him or her in debt. However part of the cause for the change in the bankruptcy law is do to those who have abused the filing power of bankruptcy. Although there are very many people who never abused the system they will have to suffer the consequences. Most people may feel that the decision is unfair. Especially to those who did all they could from falling into debt. We can not turn back the hands of time and erase the decisions that were made by our government. Regardless of your situation we most pay the same price caused by those who abused bankruptcy in the past. The best step we can take is to be prepared for all financial circumstances. Make a back up plan of your own and never have the need to even consider bankruptcy.