Archives for April 2010

Senate Begins Debate on Finance Bill About Wall Street Overhaul

The much-awaited debate on the finance bill, which proposes a sweeping regulatory overhaul of Wall Street, has begun after being voted down by the Republican Party, which strongly opposed certain provisions of the bill.

The two parties reached a compromise after Republican leader in the Senate, Mitch McConnell, agreed to begin the debate. Republicans will, however, continue to ratchet up pressure on Democrats and try their best to incorporate as many GOP amendments in the bill as they can. The Democrats have agreed to rewrite certain parts of the bill but they will proceed cautiously as Republicans have the power to filibuster amendments as well as the final vote on the bill. [Read more…]

How to Reduce Your Utility Bills Without Compromising Your Comfort Level

If you sit down and analyze your expenditure, you will realize that you spend a large chunk of your income on various utility bills such as electricity, water, and internet. There are some techniques by which you can minimize these expenses. Here are some personally tried and tested methods that will reduce your utility bills significantly. [Read more…]

Practice Financial Discipline to Avoid Falling Into Credit Card Debt

A huge credit card debt can ruin your finances. If you are not careful and deal with it quickly, your debt will keep building up, which also means that you will end up with serious credit score issues, putting your financial stability in jeopardy. Be disciplined and take steps in the right direction to avoid /credit card debt.

Increase your credit card payments

Prepare a budget for your monthly income and expenses to find out what is the maximum payment you can make on your credit card, and use your card accordingly. Cut down on unnecessary expenditure and try to increase your credit card payments. [Read more…]

Advantages and Disadvantages of Using Prepaid Credit Cards

Prepaid cards are a great alternative to make cash purchases easier to manage and track. These cards have become very popular, as people prefer to carry a compact piece of plastic instead of lots of cash, especially while traveling. But unlike credit cards, with a prepaid card you get the advantage of ensuring your expenditure stays within your budget. [Read more…]

Why ETFs are Better Investments Over Mutual Funds for the Novice Investor

ETFs are a good option for investors who want to diversify their portfolio but don’t really know how and what to invest in. Although mutual funds are a good diversification choice, ETFs bring some unique advantages to the table, which make them doubly attractive. [Read more…]

Educating Your Kids About the Basics of Money Management

Money management is not just for adults – kids who are taught the value of dollars early on grow up to become good money managers and usually don’t have debt issues.

As a responsible adult, you must sit with your kids and teach them the rights and wrongs as far as money is concerned. For this, you have to be a financially responsible adult yourself and try to set an example for your kids. Children are highly impressionable and you should use the opportunity to introduce the concept of cash generation and spending so that they go on to make good financial decisions when they become adults. [Read more…]

Average American Credit Card Debt Is it Really that Bad?

The recent economic crisis has hit the country hard. People have lost their jobs and homes, stocks and real estate values have fallen. Reports also suggest that credit card debts are sky high, with the average American owing about $9,000 on his/her credit card, which is a really scary number. Are Americans really that neck-deep in credit card debt? Or is the situation being blown way out of proportion? [Read more…]

How to Manage Inheritance Money Effectively for Longevity

It is estimated that the baby boomers will be inheriting over $10 trillion in the coming years. If you are one of the fortunate ones and have received a substantial inheritance, then you should not spend it all at once, but use it smartly depending on your current financial position so that you get long-term financial benefits.

Three important strategies should be used when using your inheritance money – setting up an emergency fund, paying off debts and making profitable investments.

Setting up an emergency fund

Set aside a portion of your inheritance funds towards an emergency fund which covers at least 6 months of your living expenditure. This fund would not only help you in case the economy goes through a bad phase again and you lose your job, it will also be useful for urgent medical expenses. You can also direct some of the inheritance money towards your retirement fund.

Pay off your debts

After the emergency fund is in place, utilize a portion of the fund to pay off your high interest debts, like credit card debts or personal loans. After that, if you are still left with money, try to clear as much of your mortgage as possible. Paying off some part of your mortgage will lower your monthly payments, and you’ll get much more freedom in choosing how to use your income. Another important benefit of paying off the mortgage is that it gives you greater equity in your house, which you can convert to cash anytime the need arises.

Make profitable investments

Direct the rest of the money towards high return yielding investments. If you want to invest in stocks, make sure you diversify your portfolio and hire a broker with a good track record. You can also hire a financial expert who will help you manage your investments and take care of any tax issues related to the inheritance.

The process of dealing with the estates that you got as part of the inheritance could be lengthy and complicated, so you should always seek professional help from an attorney who can take care of the legal aspects. It may take a couple of weeks to even years before the transfer of assets is completed, depending on the complexity of the case.

An inheritance has an emotional value attached to it, and it is your responsibility to make judicious use of the money and not take any hasty decisions.

How Much Money to Keep Aside from Your Monthly Income for Future Planning

It is imperative to plan for emergencies, little luxuries here and there, and irregular expense such as vacations, holidays, buying a car, renovating your home etc. Planned and regular savings will help you lead a more financially secure life. [Read more…]

How to Save Money and Make Money with Credit Cards

Credit cards are usually seen in a negative light as people often end up acquiring a huge debt through them. But if you fully understand how credit card companies work and use a little ingenuity, you can actually earn money using your card. [Read more…]

New Trend With Retirement Plans for 65 and Over

Changing attitudes towards retirement, with senior citizens working even beyond sixty five with as much enthusiasm and energy as they had in their thirties, is an emerging trend across the country.

The arguments for working in full-time or part-time capacity include greater appreciation of disposable income, shielding yourself and your family from risks in an unpredictable economy, or quite simple keeping yourself mentally and physically active. [Read more…]

Discuss Your Debt Situation with Your Partner to Avoid Marital Disaster

The basis of any marriage is the trust that both partners place in each other. A breach of this trust, when one partner has failed to disclose his or her debts, will at best cause marital discord and at worst end in an ugly divorce. To ensure that your poor financial management skills or faulty judgment do not cost you your marriage, complete honesty with your spouse is critical. [Read more…]

Federal Reserve Expected to Keep Interest Rates Low Despite Signs of Recovery

The economy may be taking baby steps towards recovery, but it looks like the Federal Reserve will most likely keep interest rates at their existing low levels. The committee concluded this in a meeting, and is expected to make an announcement sometime soon. Analysts say that the Federal Reserve is proceeding cautiously and do not want to increase the rates in the short term. [Read more…]

Time Tested Risk Management with Diversification

Diversification is a time-tested strategy to spread your risk and optimize your returns. It is a sound principle to follow whether you are investing for your retirement, your children’s education, or are just seeking some quick short-term gains. [Read more…]

Why You Need Travel Insurance

The ash cloud spreading across European skies after the eruption of Icelandic volcano Eyjafjallajokull left the aviation industry in agony and thousands of travelers stranded at airports, with no clue about when they will reach their destinations.

If you had planned a trip to Europe and had to cancel it, you probably lost a lot of money unless you had bought travel insurance. If you bought it before April 13th, then any non-refundable costs for a period of 5 days would have been reimbursed to you by the insurer. [Read more…]

Unemployment Benefits Extend Beyond 99 Weeks

Congress has passed a legislation that extends unemployment benefits by 99 weeks to give unemployed people some respite from stagnant hiring in most industries. However, some advocacy groups claim that even such a long period of extended benefits may not be enough time for half the number of unemployed to get jobs. They are pushing policy makers for an extension of unemployment benefits by several more months. [Read more…]

Check Your Expenses If You Want to Build Your Savings

Most people end up using their credit card because they do not have enough cash with them. Increasing credit card purchases will create a huge burden for you at the end of the month. It is much better to pay with cash than to use your credit card extensively. It will help you stick to a budget and ensure that you do not spend more than you should, which in turn would help you build your savings. [Read more…]

How to Lower Your Dental Bills, Save Money & Still Have White Teeth

Scary instruments are not the only reason of avoiding dentist visits. The huge dental bills are another reason why people want to stay away from a dentist. Here is some advice on reducing your dentist bills so that you can get your dental treatment or check-up done without seriously hurting your budget. [Read more…]

Goldman Sachs Defiant Despite History of Serious Allegations

The SEC lawsuit against Goldman Sachs alleging that it designed a financial product rigged to fail is one among the many that the company has had to face of late.

Back in 2008, Goldman Sachs paid up $60 million to terminate an investigation by the Massachusetts attorney general’s office amidst allegations of irresponsible behavior by co-operating with blacklisted subprime lenders Fremont and New Century. The company claimed that it had done nothing wrong and maintained its innocence. [Read more…]

Economy Looking Up Employment Scenario to Improve & Inflation to Fall

There is reason to cheer -reports indicate that many large companies are planning to hire, an indicator that recession is firmly behind us and the economy continues to move in a positive direction. [Read more…]

Debate on Financial Reform Blocked by Senate Republicans

After the financial meltdown was blamed for a major part on unregulated derivatives and credit default swaps (CDS), the Democrats are pushing to pass the financial reform bill that will bring in more regulation of the financial industry. But this has become a case of easier said than done as the Republicans are firmly opposed to the bill and have blocked it from being brought on the Senate floor for debate. Senate Republicans want to add significant changes to the bill and question Democrats’ tough regulations for financial institutions. [Read more…]

Do Not Forget to Include Medical Costs in Your Financial Planning

Most of us conveniently ignore to include the health insurance cost in our financial plans for future. Though you may be hale and hearty now or your company may be taking care of your health insurance, it is for a fact that you will need more and more medical assistance as you grow in age. It’s best to plan for these costs when you are no longer going to be covered by your company. [Read more…]

Start a Small Business to Ensure a Steady Income in Your Post Retirement Years

When you have worked hard and earned a steady income for the better part of your life, retiring with no monthly paycheck might seem a little scary. Consider your options. They may not be restricted to 401ks, annuity savings and IRAs. Thanks to the constantly evolving marketplace and the internet, there are several opportunities for those who wish to earn an additional income. [Read more…]

Goldman Sachs Dealings Reveal Murky Side of High Finance

As the Goldman Sachs issue continues to draw attention from the public, the media and the government, several facts are coming to light that show the murky side of high finance. Questions are being raised about the ethical standards of financial companies and the dubious dealings they indulge in. [Read more…]

Should You Rent or Buy a House Which Option Is Best for You?

As the President’s First Time Home Buyer Credit and its extension covering repeat home buyers draw to their close, and as mortgage rates start to rise, the question of whether it is financially advisable to buy a house or to rent one has become important again. Most financial advisers suggested renting when house prices were sky high, but that is set to change following much upheaval in the housing market. [Read more…]

How to Get Rid of Your Credit Card Debt and Put Money Back in Your Pocket

If you have maxed out on your credit card and are reeling under a sizeable debt, the last thing you want to do is to panic. By planning carefully and through some smart investing, you can get rid of your debt quickly. [Read more…]

Understanding How Private Mortgage Insurance Works

Private mortgage insurance (commonly known as PMI) is a type of insurance that protects the lender if the borrower fails to repay his home loan. Most lenders require such a policy when the borrower makes a down payment of less than 20% of the property’s total value or sale price. The PMI premium is included in your monthly mortgage payments, but some schemes allow the borrower to pay all the premiums in one go. [Read more…]

Respect for Money or Saving Money Starts with Loose Change

Most people have forgotten the good old practice of collecting loose change. When collected over a long period of time, pennies, dimes, nickels, and quarters can amount to a substantial amount of money. It can also act as your own little emergency fund – it will help with urgent expenses without you having to run to the ATM. [Read more…]

Financial Reform Proposals Draw Mixed Reactions

Even as President Obama’s financial reform looks all set to make a place for itself in the economic fabric of the country, critics within political circles say that these changes will still not address the risks posed by “too big to fail” institutions. [Read more…]

Planning Your Holiday Budget in Times of a Slowdown

Officially, recession has been over for 18 months now and the US economy is recovering fast. Still, unemployment rates are high and businesses have not reached pre-recession levels. In such times, it’s wise to plan your holidays or vacation carefully. Here are some tips on how to enjoy your holidays without spending too much. [Read more…]

Beginners Tips for Smart Investing and Saving Money

Investing your hard earned money well is an exercise which will require judgment, planning and substantial research. The key to sound investing is keeping yourself well informed and resisting the temptation to put money into dubious ‘get rich quick’ schemes. The best way to make sure your investments are right for your future needs and your risk appetite is to understand them well before you put your money in them. [Read more…]

Is This the Right Time to Buy a House When the Economy is Down?

The subdued activity in the housing market continues to give nightmares to economists and policy makers, but it actually presents you with a good investment opportunity for your retirement or big future expenses like your children’s education. The time seems right for investing in a home, because the prices are still low following the crash in the housing market. [Read more…]

How to Fetch a Good Price for Your House in a Down Market

Selling a house for a great price is never an easy job and it gets even tougher when the market is down. However, through careful planning for the sale, you can ensure that your house gets the best possible price. Here are some ideas you can use to boost your property’s value if it is up for sale. [Read more…]

How to Save Money the Easy Way

I have been experimenting with some simple ways of saving money and they have made a considerable difference in my accumulated savings. Savings are very important because they take care of your sudden expenses, such as a medical emergency or replacement of a necessary household appliance like your refrigerator. [Read more…]

Taking Stock of Your Finances after Losing Your Job

Managing your finances becomes extremely important when you lose your job. Your cash inflow drops suddenly and substantially, but your expenses do not lessen proportionally. The most important thing to do if you get laid off is to keep your spirits up and plan your finances carefully. Here are a few tips on how to manage your finances when unemployed. [Read more…]