Sadly, we don’t live in a world where one can realistically be expected to save their money. It just doesn’t happen anymore! A few decades ago that could have happened …
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You Can Stick To Your Budget
Recent studies have shown that Americans are spending less money on necessities than ever before. Yet, more Americans are also in debt. The unspoken fact that makes both those statements true is that Americans are spending more and more money on luxury items. Experts recommend creating a budget and sticking to it to avoid debt, but most people find that difficult to do without feeling deprived. However, there are a few things that you do quite painlessly to stay within set spending limits.
Pay cash. That’s right; people spend more when they use plastic, whether it’s debit or credit. Experts surmise that people simply don’t pay as much attention to totals as they do when they have to count out actual money. But resist the temptation to withdraw funds $20 at a time. You’ll rack up huge ATM fees. Instead, withdraw a set amount each week and see if you can make it last.
Practice mindful spending. Rather than keep an exact record of every penny you spend for a month (as many financial experts recommend) spend your time thinking about which of the things you buy on a daily or weekly basis are most important to you. For example, if you love coffee but are in the habit of grabbing a quick bite at your desk for lunch, splurge on good coffee but take a bag lunch to work. Tell yourself that you can have either that double caramel, half-fat cappuccino or a takeout lunch, but not both. Make notes on how much you save by choosing one over the other.
Round up. After you make a purchase using your debit card, when you mark it down in your checkbook, round the figure up to the next dollar. At the end of the month, transfer the difference you’ve accumulated to your savings account or use it to pay off high interest debt. Some banks are beginning to offer this service automatically. You can use the same practice with your change. Throw it in a jar and each month, deposit it in the bank.
Balance your budget. Once you’ve established your budget, be sure to check it on a monthly or preferably weekly basis. Personal financial management software typically contains a budget feature that will easily let you compare what you’ve spent to what you’ve budgeted. At the end of each day, throw your receipts in a basket and set a time once a week to balance your budget.
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Women Are Financially Ignorant No More
For several centuries, women were kept away from financial affairs. The predominantly patriarchal nature of the world had ensured that the place of the woman was in the house. However, things had been changing for a long while, and the birth of feminism in the twentieth century transformed the way things were. Women began to leave the comforts of the home and go to work. It was not about being forced to go to work. Women now had a choice. And today’s women are reaping the benefits of the feminist struggles of yesteryear. The women of today refuse to let themselves be confined to the home. They take their dreams and ambitions seriously and are pursuing successful careers alongside men. Hence, they are also interested in making investments, and one of the most popular investment options is the house.
Frankly, finances are not a matter of gender. So to that extent the title of this article is misleading. In contemporary society where both genders often have identical opportunities for advancement, there should be no room for being sexist about finances. Be it investment, credit, or personal finance. All the same, research has shown some differential orientation to credit and financial risk between the two genders. While that may or may not be true the purpose of this article is to talk about investment and credit.
Real estate offers great opportunity for investment. It is great value for money. Real estate prices seem to be ready to rise forever. Perhaps there is a peak somewhere. But if current trends continue, that peak shall hopefully still be some distance away. That is an invitation for potential investors. However, making sense of all the jargon that floats around the loan and mortgage may not be the easiest thing. It can be a problem for someone who is new to the world of mortgage loans. Thus, it makes sense to contact a mortgage broker who can explain some of the jargon and help you find the best bargains.
The Internet is filled with sites that promise to put potential home buyers in touch with suitable lenders. If you are a woman, you should try to find a site that is specially built for women. Brokers that specialize in women-specific deals are more likely to help you find cheap mortgages that may not be available to you without their help. There might be a number of lenders who come up with deals for women only. Empowerment is still high on the agenda of many organizations. Thus, you should try to look for women-specific deals. You be doing yourself a favor in the bargain.
As for those women who have an understanding of mortgage deals, it helps to look around before selecting the winner. The markets are inundated by some great mortgage deals. However, there are bound to be a few useless ones. Go through the fine print and objectively evaluate each deal. This will be a long term involvement, ensure that you are making the right choice to buy that house.
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Which Mortgage Is Best For You
Buying a home is probably the biggest decision you will every make. But deciding to buy is only the first step in the decision making process.
Now, you must decide what type of mortgage is best for you, and if youíve never bought a home before then the terms can be confusing.
Many factors must be considered when selecting the right mortgage. Most importantly, borrowers must understand how the different types of mortgages are structured.
The three most common types of mortgages are adjustable rate mortgages, fixed rate mortgages, and balloon mortgages.
An adjustable rate mortgage (ARM) is structured so that the interest rate is not locked down.
Usually, the introductory rate is set for about 5 to 7 years, at which point it will be adjusted either up or down, depending on the current interest rates.
After the initial rate adjustment, ARMs are usually adjusted every two years for the remaining length of the loan. Interest rate adjustment is usually capped at about 2 percent, meaning that the interest rate cannot be adjusted more than that each time.
ARMs are also set with a maximum adjustment rate. If the maximum adjustment rate is 7 percent, that means that the highest rate the borrower ever pays is 7 percent above the initial interest rate on the loan.
Fixed rate mortgages (FRM) are just that: fixed. The interest rate will never be adjusted.
These mortgages offer the lowest risk to the borrower, because they protect from rising interest rates. If the life of the loan is 30 years, then the borrower is protected for 3 decades from fluctuations in the market.
Drawbacks of FRMs are two-fold. If interest rates go down, you are locked into a higher rate. And often FRMs carry higher loan costs, because they carry high risks for the lender.
If a lender signs you to a 30 year FRM at 6 percent interest, and then interest rates continue to rise, the lender is locked into accepting 6 percent interest for the life of the loan.
Balloon mortgages operate quite differently, and are structured so that there will be a balance at the end of the term ñ usually 5 or 10 years ñ that must be repaid.
Some balloon loans only require that you pay the interest during the loan term, which means monthly payments are often very low, but at the end of the loan the original balance will be due in full.
Another type of balloon loan calculates payments as if the loan were to be paid in full over 30 years, which does reduce the balance at the end of the term.
Still, this type of loan must be refinanced after the loan term is up. Balloon loans can be beneficial if the borrower expects to resell the house at a profit before the ending balance comes due.
The type of mortgage you select depends largely on your plans for the house. Are you planning to live in it long term or short term?
Do you expect the property to appreciate rapidly? Keeping your long-term goals in mind will help you choose the mortgage that is right for your unique situation.
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Wise Use Of Credit Cards
Using your credit cards wisely might be the most important and beneficial decision you can make towards financial health. The reason for this is simple: high interest rates on credit cards can cost you more than money if you find yourself unable to make your payments on time.
Consider this: For most consumers, home payments (or rent payments), along with automobile payments are usually the two most expensive debts that a consumer carries. These two payments alone can often account for over 30% of a consumer’s take home pay per month. When high-interest rate credit cards are added to this, the overall cost per month can easily reach 60% or more of take home pay. That does not leave much for other expenses such as food, clothing, car insurance, personal loans, etc. For many consumers, the payments on their credit cards are the most expensive debt that they carry. In other words, the total amount of money that they have to send in on payments is higher than what they spend on home loan payments or automobile payments.
There are many reasons why credit cards can become a threat to your financial health, but the number one reason is that they are so easy to use. The number of people who use credit cards for small, incidental purchases is staggering. Consumers often forget that if they do not pay off the entire balance owed within the grace period allowed they will be charged interest. Some companies will be fair about this charge, but most will happily charge as much as they can for the credit they are extending to you.
To make matters worse, if you are late on your payments, or if you do not make any payment at all, this can be reflected in your credit score. It does not take very long at all for delinquent payments or non-payments to hit your credit report and once they are on your report they stay there for up to seven years. These marks against your credit will often cause lenders to either deny you future loans or cause them to levy higher interest rates on accounts that you may wish to open. All in all, late payments will cost you money in the future.
The very best way to handle credit cards is to pay off the balances as they occur. This not only makes you look good in your credit report but it also keeps you from having to pay those high interest rates for balances that are carried over. The second thing to do is to avoid using your credit cards unless you honestly need to do so. Instead of paying with your card, pay with cash. This one action can save you more money than you might imagine. Yes, it is easier to pay with the card sometimes, but it is also more costly.
If you feel you are already in trouble, sit down with your statements and make a plan to begin paying them down. Start with the credit cards that have the lowest balances. Once these are paid off, move to the next highest and begin paying these down. It will take patience and sacrifice, but it can be done and soon your credit cards will be under control.
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Winning the Money Struggle
Each day it seems harder and harder to stay ahead of the bills. With higher inflation, increased gas prices, credit card rates going up, and so on and so on, whatís a body to do?
For sure, doing the same old thing will not get you ahead. Perhaps a higher paying job will do the trick. Maybe youíll be written into the will of a rich uncle. Or, maybe its time to try new thinking and a new approach.
The word ìwealthî is derived from Old English words ìwealî (well-being) and ìthî (condition). ìWealthyî can be defined as ìthe state of being rich and affluent,î ìhaving an abundance of material possessions and resourcesî and ìbeing profusely happy.î What does ìwealthî mean to you? Does it mean not having to worry about money? Having good health? Having the freedom to do what you want to do? In any case, being wealthy is desirable, as it means having a higher quality of living.
This article is about increasing your monetary wealth through an approach that can quickly compound your money. There are risks (there is no such thing as a free lunch), but you can quickly learn and practice at absolutely no cost (other than an internet connection and your time). You must have a strong desire to make positive monetary changes in your life and you must set goals and take action toward achieving them.
The term ìforeign currency exchangeî seems daunting to the uninitiated. But it has been going on for thousands of years. Those that travel to other countries frequently exchange their currency for another. Today, currency can be bought and sold easily and electronically, from your home computer. Now, you too can learn how to make money ñ potentially lots of it – while participating in the foreign currency exchange (FOREX).
Accomplished author and entrepreneur Robert G. Allen, in his book ìMultiple Streams of Income,î discusses the importance of compounding oneís money in order to achieve wealth. FOREX allows you to quickly compound, for example, turning $300 into $30,000 in as little as 6 months, if you know how to safely do it.
Why choose FOREX for obtaining wealth? Below are 10 good reasons:
1. A FOREX system is definable. You can get your hands around it (so to speak).
2. You can start learning without spending anything. Once you learn a few terms, you will be on your way. You can then add to your knowledge base along the way.
3. Unlike traditional businesses, there is very little overhead. With FOREX, there is no inventory to manage, no employees to deal with and no customers.
4. Your initial capital investment can be as little as $300.
5. You can quickly compound your money, if you know how to safely do it.
6. It doesnít have to take a lot of your time. Some people only spend a few hours each week.
7. The FOREX market is very liquid, with trillions of dollars traded every day. On its slowest day, dollar volume on the FOREX market dwarfs that of the largest US stock exchanges, combined. You wonít have difficulty placing orders if you stick with the major currencies.
8. You can easily open an online account by selecting one from many available FOREX brokers. And you can open a demo account to practice (and learn) for free.
9. Once you get your account setup, you can trade currencies from just about anywhere. About all you need is a computer with internet access. Many accounts also provide free (and very adequate) charting software.
10. Many other people, from all walks of life, are successful at online foreign currency exchange. You can be too!
While there are other paths to monetary wealth, the FOREX path can lead you to your own personal success!
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Who Are Online Payday Loans For?
There may be a time where you are hit with an unexpected cash emergency, such as a bank overdraft, an unforeseen car repair, medical bill, or unexpectedly high utility payment. If you find yourself in a situation where you need emergency cash, there is now the option to apply for an online payday loan. When handled correctly, receiving an online payday loan is an advantageous economical alternative to costly overdraft fees, bounced check charges, taxes or possibly losing your job if you do not have money on hand for a needed car repair.
The months. The criterion regarding the minimum amount of time you have to be employed will vary depending on the payday lender and their policies.
The last major requirement for an online payday loan is verifiable income. The minimum required take home pay is dependent upon the payday lender and can vary from $1,200 to $2,000 a month. Since your payment would be automatically deducted from your bank account, you must have requirements for an online payday loan are few. First, you must have access to the computer and the Internet. With many households having at least one PC with the Internet, the ability to perform tasks that used to require you to personally visit the company or establishment, like applying for a cash advance or short-term loan, can now be performed in the privacy of your own home.
Secondly, to be eligible for instant cash through an online payday loan you must be at least 18 years old and employed permanently full time or part time for a minimum of 3 months, a checking account and be paid by direct deposit from your place of employment.
If you were considering applying for your first online payday loan, the amount that you could borrow would be dependent on policies of the payday lender you choose. Australiaís leading online payday loan lender allows payday loan recipients to borrow up to 30% of their net income. Regardless of your income, if you were paid weekly and you are a first time borrower, your maximum loan would not exceed $200. If you were paid every two weeks or fortnightly, the maximum online payday loan allowable would be $300. If you are paid monthly, you could borrow the lesser amount of $400 or 20% of your income. After you paid off your first loan, most payday lenders would allow you to borrow more on your next loan as long as your situation did not change.
Applying for an online payday loan would be a means to secure money quickly for those with a PC and have steady income such as those in clerical, recruiting, accounts, sales and insurance. If you manage your loan correctly, receiving an online payday loan would be a cost efficient alternative to paying costly overdraft fees, bounced check charges or possibly losing your job if you could not afford a repair on your vehicle. For these reasons, consult an online loan company. They are the convenient and hassle free way to solve some of your financial problems.
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What Can I Do If I Am In Debt?
The vast majority of consumers will, at some time or another, find themselves in debt. Debt, in and of itself, is not a bad thing. Debt allows those who are not wealthy to purchase items that otherwise would be out of reach. Home and automobiles are two examples of items that might take years, if not a lifetime, to save enough to pay cash for. By using credit, which leads to debt, people are able to experience a better standard of living. As mentioned above, debt is not a bad thing, until it becomes out of control. Then it can become a very bad thing.
How can a consumer know if he or she is getting too far into debt? Here are some of the signs that might appear that consumers should be aware of.
Missing a payment because of a lack of funds: Most consumers will find themselves short of cash from time to time, but if you are missing payments on a regular basis or habitually making late payments as you try to juggle cash around, in essence, robbing Peter to pay Paul, then you may want to sit down and carefully look at your income versus your debt.
If you do not open the mail that comes from your creditors because you are afraid of what it might say, you are probably too far in debt.
When you have to regularly borrow money in order to pay your monthly bills, you are too far in debt.
If at the end of the month you are only able to pay the minimum payments and there is no cash left over for savings, you are probably heading for trouble.
So what can you do to alleviate these debt problems?
There are actually a few things you can do and it all starts with planning.
There are two basic documents that you need to start with: An income statement and an expense statement. It is very difficult to know where you stand financially if you do not understand how much money is coming in and how much money is going out. These are easy to create and they are filled with power once you have them finished.
Your income statement is simply a list of all the income that you have coming in. Your expense statement is probably going to be longer and will take a bit more time, but it is important. List all of your expenses including rent, auto payments, insurance payments, credit card payments, etc. Try not to forget anything.
Subtract your expenses from your income and that is your disposable cash for the period. Some people may have a negative number, meaning they are spending more cash than they are getting in. This is a sure sign of trouble.
If your disposable income is a small amount or a negative number you may want to continue reading some of the other useful articles we have available for you. There are certain actions you can take to help get you out of debt or at least reduce the strain that it has on your income. Working on your debt issues is time well spent.
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What Are The Types Of Bank Accounts?
If you are new to banking, you may be surprised to learn that there are many types of bank accounts available. The type of bank account that you will need will depend on several factors. This article will examine some of the more common types of bank accounts that you will find at most banks and credit unions.
First, you should understand that not all banks and credit unions will offer the same types of accounts. Larger banks will usually offer the most services, but smaller banks are also usually well suited for most consumer needs.
The most popular bank account is the checking account. A checking account uses paper checks and/or electronic funds transfers as its primary means of business. When you open a checking account you will receive paper checks that you can use to pay bills and make purchases. Many checking accounts are free, but some may charge a small fee each month. With your checking account you may get access to ATM machines as well. The most important thing to remember about checking accounts is to not write checks that you cannot cover with the funds in your account. This is called bouncing a check and it can cost a lot of money in service charges and fees. It can also lead to criminal charges in some cases.
The savings account is the next most popular bank account type.
A savings account allows you to make deposits and withdrawals, just as a checking account does, however, savings accounts are not as flexible as checking accounts. Some savings accounts only allow a certain number of withdrawals per month. Normally, savings accounts do not include checks, so to get cash you have to visit the bank in person. Today, most banks to allow savings accounts to be accessed through ATM’s for both deposits and withdrawals.
A third bank account is the money market accounts that some banks offer. A money market account pays higher interest on your deposits than a savings account but there are added restrictions as well. Often, these accounts will have a minimum balance that must be kept in order to earn the higher interest rate. Most accounts of this type also limit withdrawals to six a month. This type of account is used most effectively for cash that you do not think you will need to use soon.
Certificates of deposit are yet another type of bank account that some consumers find useful. These accounts should be thought of and treated as investments rather than money-moving accounts. CD’s require you to make a deposit and to agree to leave the money in the account for a predetermined length of time. In exchange, the bank or credit union agrees to pays higher interest.
With a CD, you are required to keep the money in the CD bank account until the maturity date of the CD. If you take the money out early you are usually charged a penalty fee. In some cases, you may be allowed to withdraw the interest that has accrued without suffering a penalty, but you should check on this before assuming it to be true for all CD’s.
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Using Home Equity To Get Out Of Bankruptcy
The type of debt a person has may influence their decision on the type of bankruptcy they file, especially if it means they will be able to maintain some of their possessions. Looking at the difference between secured and unsecured debt, it can be defined as with secured debt, if the payments are not made the person holding the note and reclaim the merchandise. Take heed and gain respectable debt reduction advice to keep yourself out of heavy debt.
Typically, secured debt involves a home mortgage or a car loan. In many cases of default, the car is repossessed and the house goes through foreclosure. Typically, merchandise taken through a loan default is auctioned and the debtor is liable for any remaining balance plus the cost of recovery and sale. In situations where a debtor is behind in payments and wants to keep their car and their house, a Chapter 13 may offer the relief they need.
The balances will still have to be paid on a plan worked out with the creditor, often the same payment as in the past while past due payments are paid through a plan approved by the bankruptcy court. This allows for breathing room for the debtor to begin putting their financial life back on track.
Unsecured debts, such as most credit cards and store charge cards have no merchandise help as collateral for the loan and if the debtor defaults on the loan, the creditor has nothing they can take back. Their only recourse is through civil court to recover the balance owed. If a personís majority debt is unsecured and there is no car or house in the picture, Chapter 13 bankruptcy can eliminate the debt. With debt reduction advice, you can be sure you wonít need to file bankruptcy. At least, not more than once!
Homeowners who file for bankruptcy often find that the trustee will search for any assets belonging to the debtor and when filing a Chapter 13 bankruptcy, the equity in the home will need to be listed. It is not unusual for the equity to be used to pay off all or some of the outstanding debt in a Chapter 13 bankruptcy case but there may be options available in how that is done.
The attorney can petition the court for permission to add debt in a case, where the homeowner can take out a second mortgage, or home equity loan, to pay off the debt through the court. This can be advantageous in a couple of ways to the debtor.
First, during a Chapter 13 plan, the repayment plan is typically for three to five years while a home equity loan can be for a longer period of time. While the debtor is still paying off the debts, it is now in the form of a second mortgage, which can also get them out of bankruptcy much quicker. In some cases, re-mortgaging the home can often realize a lower interest rate, which if spread over the same length of time, will result in lower monthly payments.
When applying for a home equity loan bankruptcy option, it is important to advise the lender of the nature of the loan. They may see it as a way of keeping your financial house in order instead of denying the loan due to the presence of bankruptcy in progress.
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Using Credit Cards To Build Your Credit Score
Even if you consistently pay rent, utilities, and phone bills without a problem, you could still be denied a simple loan if you do not have an established credit history. The key is to establish your credit history before you actually need that car or mortgage loan. A simple way to start building credit history, before you go in for that loan, is through credit cards.
A credit card is much simpler to obtain than a loan, and it is a good way to demonstrate to lenders that you are capable of being a responsible consumer. Anyone can build credit history, but the important part is to build a good credit history. A few simple tips will help ensure that you start building from a good foundation.
Donít apply for every credit card offer you see
Applying for many credit cards within a small amount of time, even if you never use the card, or are not even accepted for the card, can damage your credit score. It is often a good idea to start with a bank or credit union that also takes care of your checking or savings accounts.
Donít max out your card
Although most cards offered to people with no credit history will have low spending limits, avoid charging close to the maximum line of credit. Your credit score can be lowered just because you charge more than 30% of the limit. Also, using your credit card for small purchases will make it easier to pay off every month.
Make payments on time
Making late payments will lower you credit score and most likely incur extra charges or fees. Late payments can stay on you credit history for years, so do not leave your payment until the last second and risk a small problem turning into a large cost.
What if you are having a difficult time even being accepted for a credit card? Donít worry; there are still ways of starting to build your good credit.
Borrow someone elseís good credit
You may ask your parents about adding your name as an authorized user of one of their credit cards. You will have to make sure that the lender will report authorized users not married to the primary card holder to ensure that this will add to your credit history. Also make sure that it is good credit that you are borrowing. Late payments and other problems will also be added to your credit history.
Secured credit cards
Some lenders will allow you to pay a deposit in return for a credit card. The credit limit of this card is usually the amount of the deposit. This allows the lender to be safe against any default, while you are gaining credit history. After building your history with a secured card, you are more likely to be eligible for a non-secure credit card.
In-store credit cards
Many stores have credit cards that can be used only at that particular store. This type of card is also reported to the credit bureaus and, therefore, is a way to build your credit history. Remember, do not get too many of these at once, or it can damage your credit score.
Getting a credit card is an easy step toward building your credit history. It is a manageable option for most people and does not require getting into debt to boost your score. If you establish a good credit history early, you will have it in place when you need it, saving you grief, and most likely some interest as well.