In The Spotlight by www.badcreditloancenter.com

Retirement Solutions: An Introduction to 401(k) Plans and IRA

401(k) plans and IRAs are two of the most popular ways of building a retirement fund. Here is a brief overview of these two options:

401(k) plans

401(k) plans are primarily employer-sponsored retirement plans for employees. Under these, the company can offer you some investment options to choose from. The 401(k) account is managed by the employer, where they deposit a part of your wage along with a matching contribution from the company. These funds are invested by investment experts, depending on your plan options, into various instruments.
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Protect Your Debit Card from Scams

Today, a huge percentage of people with a bank account have a debit card too. These cards are gaining in popularity against the previously all-pervasive credit card. But you have to be careful when using these cards so that you don’t put the funds in your bank account at risk. Here are some tips:

While debit cards are certainly convenient to use, they can cause serious financial problems if you are unaware of the risks involved. Fraudsters can steal your debit card details and use them to drain your bank account. There has recently been a huge spurt in this type of criminal activity. There are three main scams that you need to be aware of:
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How to Avoid the Debt Trap

Post recession, many Americans found themselves barely keeping their heads above overwhelming debt they had incurred through various ways.

The most common way of incurring unmanageable debt was through excessive use of credit cards. But this is, by no means, the only danger area. There are many ways in which you can let yourself become exposed to a debt trap. Here are a few tips on staying clear of debt:

Build an emergency fund

Many people, who are otherwise conservative spenders, end up with enormous debt when emergencies catch them completely unprepared. It might be a home repair or a medical emergency that forces you to take a loan.

No matter what the underlying cause, when the emergency is upon you, you do not have the time or the clarity of thought to search for competitively priced loans. You simply opt for the easiest to get, fastest to process or simplest to understand loan. Unfortunately, it is these loans that are often also the worst.
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Use Your Credit Card Wisely

As credit card delinquency rates continue to fall from the 26% level last year, it is inevitable that credit card companies will soon put their marketing skills into overdrive. New credit card offers are beginning to flow in from various companies to customers who have maintained a good credit record post-recession. In fact, the 0% card offer is also making a comeback now.

None of these signs mean that you can afford to relax your firm control over spending using this piece of plastic. In this climate of over enthusiastic advertising and tall claims from credit card companies, it is important to be doubly careful of how you are managing your credit card.
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Cutting Down on Expenses to Get Rid of Debt

If your world has come crashing down and creditors are after your life, remember there is always a way out of every problem. If you are debt-ridden, you can still pay it all off with some planning and personal sacrifices. You got yourself into this financial mess and you can get yourself out of it as well. You simply have to be judicious with your money during this period. A drastic cut down on expenses will help you save enough money to pay at least a part of the money you owe.
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How to Choose the Right Home Insurance

Insuring your home should be among your top priorities, no matter what your income level or financial condition is. It is much more important than some other insurance options, like auto insurance. After all, you can live without your car for a while but you cannot live without a roof over your head and you might not be able to afford major home related expenses with your savings alone. Your home is your most important and valuable asset and you should have adequate insurance on it.

Don’t Pinch Pennies

The most important aspect of home insurance is to make sure you are not underinsuring. There is simply no point in having your insurance pay up an amount that is not enough for your house. In event of any damage to your home, the insurance should pay as much as is required to rebuild the house. [Read more…]

Why Real Estate is Still a Good Investment

A few years ago, before the recession and the housing crash drowned out these notions, almost every investor big and small swore by his investments in real estate. The idea that property was the one investment that was a sure fire winner was so common that it was practically an axiom. Then the housing bubble burst, leaving investors with huge debts and property on their hands that was speedily spiraling downwards, value wise.

In spite of several shoring up efforts, housing is yet to regain the ground it lost. Home values are still low and the buyer is still playing the dominant role in this market. However, in spite of the dramatic decline in the market, real estate is still a good investment. [Read more…]

Save Money by Refinancing Your Mortgage

There could be many advantages of refinancing a mortgage, like lower monthly payments and getting a longer time to repay the loan. If you are having difficulty in making your mortgage payments, you should seriously consider refinancing the mortgage to get better terms. Even if you can afford your current mortgage, you can reduce the costs of your home loan through refinancing.

How to Go About It

When you decide to get your loan refinanced, the first person you should approach is your existing lender. The lender might be willing to refinance your mortgage at competitive terms and you may not need to look further. If you have made timely payments and have a good relationship with the lender, the whole process should go smoothly. [Read more…]

Financial Tips for Married Couples

Marriage brings together two individuals who may have strong individual views on everything from sports, clothes, food to financial goals. For a successful marriage, managing the family’s finances amicably is one critical area. Many separations and divorces take place when partners fail to come to an agreement about money management in the family. Here are some tips that will help married couples handle their joint finances in perfect harmony.

Accept Different Opinions

The first and the most basic rule is to accept that your partner need not necessarily have the same views as you about your financial goals. Your partner may want to save for future medical expenses while you may think your current emergency fund is enough. You may think vacationing is an essential expense and needs to be saved for, while your partner may think it is extravagant. This is inevitable and unavoidable. Once you accept this, financial management gets easier.

Discuss Your Views

It is important for both of you to discuss your views and arrive at a mutually acceptable conclusion about what the priorities of your family should be. Remember that these may be very different from your personal priorities.

Ideally, this discussion should take place even before marriage. But it can certainly be done after marriage too, provided both partners agree to act as responsible, mature adults who can put the family’s needs before their own.

Are Two Pay Checks Better Than One?

If both partners are employed, there are some important points to consider. Do two paychecks coming in every month really mean more money? It may not always be the case. Check if the double income puts you in a higher tax bracket so that you end up paying much more by way of tax than the second paycheck brings in. If so, seriously consider quitting that job. Remember that there are costs associated with earning that paycheck – transportation to and from work, day care for kids while you are at work, work wardrobe etc. [Read more…]

Generate Cash from Unused Household Items

All of us have stuff lying around the home that has not been used in ages. These clutter your home and occupy space. What’s more, by selling some of these items you can generate some much needed cash in this difficult economy. Here’s how to go about clearing up these household articles.

Identify What You Can Get Rid Of

If you haven’t used an item in the past 6 months or more, chances are you won’t miss it. Items like these can be disposed off. Go through your storage spaces and collect all items that haven’t seen the light of day in 6 months or more. These can all be put to better use. Once you have collected all your disposable items, it’s time to classify them into what you can give away, what can be sold, and junk. [Read more…]

Should You Buy or Rent Your Home

A comfortable and nice home is one of the essentials to a happy life. When it comes to the house, most people face the dilemma of whether to rent a home or buy one right away. There are loyal supporters of both arguments, as each option offers some unique advantages. [Read more…]

How Much Saving is Enough for Financial Independence

The economy is still floundering and the fear of being unable to meet future expenses continues to loom large in the minds of most people. Savings are at an all time high with conservatism being the key characteristic of all investments being made in recent times. Saving is fine, but there is a limit to how much you need to save.

Avoid Penny Pinching

Post recession, many people tend to overdo saving by putting away every spare cent. This may give you a confident feeling for a while as you watch your emergency fund grow. But sacrificing every little ‘extra’ can get awfully tedious and frustrating. In fact, denying yourself those little extra pleasures often ends in a hugely expensive shopping spree where you simply end up throwing money. Give yourself a break and allow a small ‘fun spending fund’ for every month to keep your spending urge in control. [Read more…]

The Differences Between Fixed Mortgage Rates and Adjustable Mortgage Rates

There are so many different kinds of mortgage loans that you may feel overwhelmed when looking for one. The key factors that distinguish one mortgage loan from another are the rate of interest, loan tenure, payment amount and prepayment clauses. The most common mortgages are fixed rate and adjustable or variable rate mortgages. You should go about choosing one of these mortgages based on how much risk you can afford to take, and how long you intend to live in your present residence. [Read more…]

It’s Never Too Late to Start Investing

Earning a steady income gives you the financial support you need for as long as you work. But by the time you reach retirement age, you should have enough money saved – through 401ks, annuities, IRA funds, or any other fund – to live the rest of your life comfortably.

The earlier you start saving, the more you will end up with. If you’re already close to retirement and have not put aside much, you may face some difficulties when you stop working, but it is not too late to act now. There are many options that are available that will help you earn good returns over the next few years. Start assessing the possibilities immediately and you may still be able to manage a comfortable post retirement life. [Read more…]

Don’t Fixate On Income When Investing

Everyone needs to save money for a rainy day. To achieve this, you can look at different ways to increase your income and boost your savings. One of the most popular ways to get additional income is investing.

Investing requires a certain degree of calculation and risk assessment. You need to understand the risks involved and employ the safest means to get a good return. With most people considering long term locking-in of capital too risky, they are increasingly investing in stocks and bonds that give a continuous stream of income. However, if you fixate on a portfolio that is not diversified enough in terms of cash flows that it generates, you may lose money in the long term. [Read more…]

How to Keep Your Finances on Track

The degree of economic contraction that the country has suffered in the past few years is nothing short of phenomenal. People are picking up the pieces, and for now, things seem to be progressing in the right direction. Your personal finances must have suffered some serious setbacks as well. Since you cannot accurately predict when such a situation may occur again, you need to figure out ways to stay financially stable to withstand these events. [Read more…]

Retirement Investment Tips

The one thing certain in the investment world is that there are no certainties. With the stock market crash, investors stopped buying stocks and concentrated on buying bonds. Billions of dollars have been invested in bonds and bond ETFs recently. But if you are thinking of putting all your 401(k) money into a single bond, you could be making a big mistake. [Read more…]

When Should You Refinance Your Mortgage?

People who choose adjustable rate mortgages end up realizing that fluctuating lending rates can be a spanner in the works when it comes to budgeting. Worse still, if interest rates stay consistently high, they may be in danger of paying much more than they initially thought.

That is why when interest rates fall, it is a good idea to refinance your floating rate loan with a fixed rate mortgage to gain more time to repay and avail lower interest rates. Refinancing is a good option if you are paying variable monthly installments and wish for more consistent (and sometimes lower) payments. [Read more…]

Build Savings Early for a Comfortable Retirement

If you want to retire in comfort after all those years of hard work, you need to start saving early. It is very important to save a portion of your income without fail if you want to maintain a good standard of living after retirement. How much you save depends on your salary, job-stability and expenses, but once you’ve decided on a particular percentage of salary, always stick to that percentage.

You should remember that you can save a much higher percentage of your income when you are in your 20’s and early 30’s. This is because you might not have dependents and your expenses will consequently be lesser. Financial experts say that working professionals in their 20’s and early 30’s must save about 25% to 35% of their income.

You should also contribute more to your 401(k) and save any bonus that you get from your company. Make sure you pay off all those college loans as quickly as you can. Do not splurge on expensive gadgets, cars and designer brands even if you have of a good income, until you are already meeting your savings goals.

If you are in your late 30’s and early 40’s, you need to save at least 10% to 15% of your income. This is the period when expenses increase as you might have kids. It will be more difficult to build savings in this period, but you should plan your budget carefully and always adhere to it. Involve your spouse and children in the budget making process.

Apart from setting aside money, you can consult a financial advisor on investments, taxes and other ways of saving or growing your money. For example, investments in equities and bonds can yield substantial profits, so make sure you have a low-risk portfolio of stocks, bonds and mutual funds. [Read more…]

Can You Trust Debt Settlement Companies?

You will find many tempting offers by companies claiming that they can settle your huge debt for a small amount. Many people may be lured by these promises, but in reality, these promises are hollow and there is no way of getting away by paying a small part of your debt. [Read more…]

Plan Your Monthly Budget to Stay Financially Sound

People today are far more budget conscious than they were two years ago. With the economy not in a great shape, consumer spending has gone down and businesses have been offering promotions and discounts to boost their sales. It may be tempting to spend your paycheck on all those great offers, but your priority right now should be to save sufficient money for important things like paying for your children’s education or your family’s medical bills. Here are some tips on how you can start saving more money every month: [Read more…]

Investing in Tough Industries is Not Always a Bad Idea

There are many industries that are considered a bad choice for investors as they generally do not give good returns. Most investors simply stay away from these industries, which include airlines, real estate and other such industries that are capital intensive and suffer a lot of uncertainty. [Read more…]

Allocating Funds Between Stocks and Bonds

We have just gone through a severe recession during which many people lost a large chunk of their investments. Investors are now taking all kinds of precautions and one of the things that you may be considering is whether they should completely give up on stocks. And even if you continue to invest in stocks, how do you know when to get out of the market? [Read more…]

Minimizing Risk in Private Mortgage Lending

Private mortgaging lending can give good returns without too much risk. You can ask for a high interest rate as only those borrowers who have not been able to get loans from banks and other traditional lenders turn to private mortgage lenders. This means that you can get better returns than those from traditional investment options like the stock market. And if the borrower starts defaulting, your equity in the property will increase, which will cover your investment

The property is the collateral for the loan due to which the investment is relatively secure. Moreover, a private mortgage lender gives loan for only about 50 to 70% of the total value of the property, and this low loan to value ratio makes the investment even safer. But to be able to benefit from this low risk and high return investment, you need to keep a few important things in mind.

Inspect the property

Before you give a private loan for a property, you should personally inspect it as photographs can be misleading. Inspect all the documents carefully. You should get the property deed and read the description of the property and this description should match the property. It is always better to finance a property that is in your own area. You can personally inspect the property and make enquiries, and you will know the kind of risks involved.

Make sure it is a primary mortgage

You should carry out a complete investigation and see that there is no prior mortgage on the property or the property is not about to be foreclosed. If there is another mortgage, then your risk will increase significantly and your LTV ratio should be lower. It is always better to finance a fresh mortgage than refinancing an existing mortgage. Your investment will be more secure as a primary mortgage.

Insurance

Another thing that you should look out for is whether the property has adequate insurance cover. The standard insurance will not cover many risks such as floods. If the property is in an area where such a risky event occurs frequently, then you should insist on separate insurance for that risk.

Paperwork should be in order

You should sign a proper legal contract when you are getting into a private mortgage deal. This will not only help in case of legal disputes, but will also be needed when you are filing tax returns.

Tips to Help Single Moms Save Money

Women are often not paid as well as men are. It is said that for every dollar that a man earns, a woman takes home about 78 cents. Added to this, household needs eat into a major portion of their salaries, thus making it very difficult to set aside savings. All this means that as a woman, you need to make smart choices to achieve true financial independence. And the most important aspect of improving your financial situation is to save more. [Read more…]

Stimulus Packages are Coming to an End and Governments Cut Down on Public Services

After months of squabbling, federal spending to stimulate the economy is all set to come to a halt soon. Up until now, the government’s stimulus packages provided valuable support to a struggling economy. But the funding is running out and both federal and state governments are looking at cutting down on public services. It is expected that the administration will have to make additional cuts or find new sources of revenue for fiscal year 2011 to avoid deficit from spiraling out of control. [Read more…]

Underwater Mortgages Continue to Trouble Housing Market

From 4% in 2006 to more than 23% in the first quarter of the current year, the steep increase in the number of ‘underwater’ mortgages has underscored the slowdown in the housing market.

After years of easy mortgage loans and soft terms of repayment led to thousands of Americans opting for these loans to buy homes, the downturn brought with it a dramatic decline in the market. A huge percentage of the borrowers who had taken advantage of easy terms ended up unable to pay back the loans and were forced to foreclose on their homes. [Read more…]

Goldman Admits it May Have to Face More Legal Battles

Goldman Sachs has been in the eye of a storm over the firm’s allegedly unethical conduct before and during the financial crisis. Lawmakers have criticized the firm for selling poor quality mortgage based products to unsuspecting buyers. As the housing segment took a nosedive during the recession, more and more borrowers defaulted on their mortgages, leaving investors with huge losses. [Read more…]

Should You Let Your Teenagers Have a Credit Card?

Credit cards for teenagers is a controversial topic with many parents supporting them and others strongly opposing them. There are many reasons due to which credit cards should not be given to teenagers. The most important one being that no one should take a debt that they cannot pay back on their own. [Read more…]

How to Save on Health Care with Open Enrollment

Most companies are looking to reduce their contributions or transfer a greater portion of health care costs over to their employees. Open enrolment, during which you can change your coverage options, gives you the chance to adjust your plans if the current coverage is turning out to be too expensive for you. For most Americans, this is the only time every year they can make any changes to their prescription costs. [Read more…]

Strategic Default on Your Mortgage How Will it Impact You?

There are some ways to tackle a mortgage if you find yourself unable to afford the payments, like loan modification and refinance, but they don’t always help. There is one other alternative that can save you from paying thousands of dollars in mortgage payments – strategic default. [Read more…]

How to Protect Yourself When Using a Debt Consolidation Service

The easiest way to spoil your credit history is by piling up a lot of debt and missing payments. Other than its impact on your credit score, a huge debt will also significantly affect your lifestyle and peace of mind.

If you’ve made some bad financial decisions or have had to make a huge emergency expense using debt, you may be wondering how you are going to get out of this situation. If you’re desperate to steer yourself out of a debt trap, you can go for an effective debt management method known as debt consolidation. [Read more…]

Protect Your Finances from Online Fraud

Most of us use online payment gateways and visit our banks more often virtually than in person. But a lot of the information you view and input on the internet is not as safe as you think it is. In fact, by running a simple Google search, you will come across several tutorials on how to easily bypass firewalls and other security measures. It is therefore very important that you take precautions to protect your money when you transact online. [Read more…]

Stay Financially Stable by Limiting Your Credit Card Spending

Credit cards are the most popular method of making purchases after cash. But if you are not disciplined, credit cards can significantly increase your total expenditure.

If you are buying something that costs more than what you find reasonable or you can afford, then you would hesitate if you are paying by cash. On the other hand, most people rarely think twice before presenting a credit card for a payment. [Read more…]