How to Create a Budget for Effective Cost Cutting

If you have dreams of saving enough money to take a world tour or enjoy the perfect, anxiety free retirement, it is essential to have a well thought out budget in place right now.

A budget can help you regulate the amount of money you spend and what you spend it on. Many people find it difficult to stick to a budget because they do not have a clear goal. If you don’t know what you are saving for, there is a good chance that you’ll end up being undisciplined with your money. On the other hand, sometimes the budget can be too austere and you might find it too hard to stick to it. [Read more…]

When to Opt for a Voluntary Foreclosure

Earlier people used to do everything to save their house from being foreclosed by the banks. But with the recent collapse of the housing market, a lot has changed. Many people who had bought homes without paying any deposit of their own ended up having no equity in their house and their financial situation just keeps getting worse. In many such situations, people are left with no option, but to foreclose their house. [Read more…]

Buying a Home Becomes More Expensive as Mortgage Rates Rise

Even as real estate developers and analysts eagerly await the spring season which is traditionally the best time of the year for sellers, mortgage rates are rising, following the Fed’s cautious step backwards from its mortgage purchase program. [Read more…]

One of Wall Street’s Biggest Investment Firms Goldman Sachs Denies Betting Allegations

One of Wall Street’s biggest investment and securities firms, Goldman Sachs, has been accused of betting against its clients. The firm allegedly sold securities backed by mortgages to clients, while reducing its own exposure to similar instruments in a bid to lower its risk. [Read more…]

OECD Urges Countries to End Stimulus

The Organization for Economic Cooperation and Development has urged countries to gradually stop the fiscal stimulus measures within 2010. The OECD stated that economic growth will continue during the first half of 2010, albeit at a slower rate. This will be preceded by a decline in supply and an end to additional borrowings. [Read more…]

Is Gold A Sound Investment Option or Media Hype?

There is a lot of hype surrounding gold as an investment opportunity. The poor economic situation has subdued the value of other assets, and gold prices have risen as people look for safer investment options.

In reality, the increase in price of gold is a trend that is similar to the recent real estate bubble or the oil bubble. Discerning institutional investors tend to park funds in assets they believe will improve in value, owing to which prices escalate for that particular asset. [Read more…]

How to Establish a Second Source of Income

If you are stuck in a situation where your current income does not cover your normal expenses or you do not have job security, then it is time to look for a second source of income. Establishing a second income source makes your earnings more diverse and reduces the risk of financial distress if you lose your main job. It can help you retire early by boosting your savings and may even offer an alternative source of income after retirement. [Read more…]

Be Prepared and Plan for the Unexpected

We don’t live our lives expecting fatality or terminal illness, but on the other hand, living like there’s no tomorrow can have its own repercussions, especially if we leave our loved ones behind to pick up the threads. It’s a good idea to write instructions down that will let your family know what to do in case something happens to you. Here are a few guidelines that you can follow to organize your financial affairs and protect your family and loved ones in case of an unexpected event. [Read more…]

Get Organized Do Away with the Clutter of Unnecessary Documents

It is for a fact that you are unlikely to need a lot of financial documents that you store dating all the way, since you started managing your own finances. They simply create more clutter in physical and mental space than have any real value or use. [Read more…]

Get Errors in Your Credit Report Corrected

Only last month, one of my close friends spotted a big error in his credit report. His home mortgage was wrongly shown as unpaid when it has been paid for over a year now. Such errors in credit reports are not uncommon and it is a good idea to check yours to avoid getting bad deals on future loans. If you find an error in your report, then do not panic as it is not difficult to get the mistakes corrected. [Read more…]

William Dudley Offers Advice on Combating Asset Bubbles

William C. Dudley, President of the Federal Reserve Bank of New York, recently offered some advice on the subject of formation of asset bubbles in the economy and what central banks can do to deal with it. The recent financial crisis highlighted how poor regulation made the financial system vulnerable and led to bubble formation. [Read more…]

Follow IRS Advice to Make Tax Filing Simpler

The upcoming tax filing deadline is giving most Americans headaches and sleepless nights. But the IRS is doing its bit to help people by asking them to stay informed about the latest changes in policies so that they can benefit from the new tax breaks announced as part of President Obama’s economic reconstruction program. [Read more…]

Avoid Being Scammed When Using Your Debit Card

When buying a product or service, many people use their debit card to make the payment. But before you use your debit card, stop and think whether it is the best way of making that particular payment.

Debit cards and credit cards are quite different and they have their own advantages and disadvantages. There are different levels of protection provided in these cards – the most important difference being that a debit card gives direct access to your checking account, which means it is riskier. [Read more…]

Understanding Your Financial Situation

It would be great if all of us had a barometer to keep a check on our personal finances. But we don’t! So it becomes important to understand some key concepts that will help you assess your financial situation. This will give you insights into how stable your finances are and what you can do to improve the situation. Here are a few things you need to know: [Read more…]

Minimizing Your Communication and Entertainment Expenses

Recent studies show that Americans are spending more and more on communication and entertainment equipment and services. Some common expenses include cable TV, internet, video games, cell phones and land line connections. The problem is that the prices of these services are steadily increasing and people often end up spending more than they have to. [Read more…]

Greenspan Appears Before FCIC

The Financial Crisis Inquiry Commission called former chairman of the Federal Reserve Alan Greenspan to testify before it this week.

Greenspan had earlier asked for his report to the Brookings Institute to be included in the findings of the inquiry. In this report, Greenspan admits that under his leadership, the housing sector was not monitored adequately and neither was the banking expansion analyzed with regard to its long term effects on the economy. [Read more…]

Fed Still Cautious About Recovery Predictions

The Federal Reserve is keeping its optimism regarding the future of the American economy under a tight rein for now. At a meeting earlier in the week, debate appears to have taken place on what the Fed policy should be in the near future to improve the current pace of growth, without upsetting the delicate balance which many sectors of the economy have just managed to achieve. [Read more…]

Planning for Changes in Healthcare Laws

The healthcare scenario is going to change significantly because of the reform bill passed by the Obama administration. Health insurance will become compulsory for the majority of the population and failure to get it could lead to a penalty. Though many of the changes are still far away, you should start thinking about how you will adjust to the new system. [Read more…]

Money vs. Job Satisfaction

Your work constitutes a crucial part of your life. An average person starts working from the age of 23 till the time that he or she is about 60 years old. And during this period, a large proportion of your time is dedicated to your job for at least 5 days a week. [Read more…]

Tips on How to Make Money from IPOs

Initial public offerings, or IPOs, are considered riskier than the rest of the stock market because there is lot of uncertainty attached to them. It is hard to predict the right price of an IPO stock, but understanding the market fundamentals will help you make money out of these opportunities. And if you get it right, investing in IPOs can be extremely profitable. [Read more…]

How to Get Back on Your Feet After the Recession

The economy has recovered from the recession and is again growing at a good rate. The value of stocks has started rising again and investor interest in stock market is slowly picking up. The government is also retracting some of its liberal policies that were introduced to deal with the recession and the inter-bank lending rate could soon be increased by the Fed. [Read more…]

How Are Lenders Recovering Money on Distressed Home Mortgages?

Lenders are employing a mixed bag strategy to recover money on bad home loans. Interestingly, the mortgage servicers are the ones showing way to even large lenders on how to settle loans of distressed borrowers. Besides the traditional mortgage modification methods, principal reductions and short sales are some of the other commonly adopted settlement strategies currently. [Read more…]

Obama Administration Optimistic About Economic Recovery

According to statements from President Obama’s team of economic advisors, the American economy is recovering slowly but steadily. Last month recorded a moderate rise in employment, and senior advisers to the President said that real progress was being made for bringing down the current unemployment rate, which stands at 9.7 percent. Around 162,000 new jobs were created in the month of March. [Read more…]

SBA’s Lending Program Vital for Economic Recovery

The past year has seen no significant increase in loan disbursements among lending institutions. The good news is that the small business lending market is recording considerable progress, thanks to the legislation that extends the provisions of the American Recovery and Reinvestment Act. [Read more…]

Questions You’ll Be Asked when Buying Auto Insurance

When you are getting motor vehicle insurance, the insurance company would ask you many questions. These questions are not just the basis for refusing insurance cover, but they also determine the premium you have to pay on your insurance policy. Here are some of the common questions asked by motor vehicle insurers and their potential impact on insurance costs. [Read more…]

Is it Unethical to Walk Away from Your Mortgage?

Voluntary foreclosure, often referred to as walking away from the mortgage, has been called unethical and ruthless by some people in the financial industry. What the industry does not seem to realize is that most people who have to walk away from the mortgage do not have a choice as they are in severe financial distress. [Read more…]

Private Equity Fails to Give Good Returns to Pension Funds

Pension funds have paid huge fees to private equity companies in the last decade in order to increase the returns on their funds. But a look at their returns shows that it would be very hard to justify the fees that they have paid. [Read more…]

How to Build Your Retirement Savings

When you are young, retirement seems like a distant prospect, which you do not need to worry about. However, before you know, time will fly and you will be close to your retirement age. Instead of being sorry later, it is better you start investing when you still have ample time to build your retirement savings without unnecessary pressure. If you start early, you get more time to earn higher returns on your investment. [Read more…]

Citigroup on Their Way to Recovery

Even as the Obama government initiates plans to stop hand holding Citigroup and move out of their bail out program for the banking giant, the company is taking its first steps forwards after a particularly bad phase which threatened its survival. The man being hailed as the one who achieved the near impossible and turned around the group is the Citigroup chief executive Vikram S. Pandit. [Read more…]

FCIC Commission Not Meeting Expectations

The Financial Crisis Inquiry Commission or FCIC, the ten member panel that has been given the task of identifying the main factors which caused the recent economic crisis is not likely to meet expectations. Panel members are believed to be struggling with several differences, leading to stagnation in the investigation process. [Read more…]

Housing Crash Has Not Reduced Desire for a Home Fannie Mae

Although the housing sector has not really regained its balance after the recession left borrowers struggling to keep their heads above water, Americans still appear to view buying a house as an essential expense. But the volatility in the market has taken its toll and potential home owners and investors are using extreme caution when actually finalizing a home deal. [Read more…]

How to Prepare for Getting Laid Off

Most companies had cut down their staff drastically during the economic recession. Some of my friends, and millions of other Americans, learn the hard way that being fired is a nightmare that can come true without warning.

It is even worse when you have not planned for the possibility of being fired and are caught off guard, as losing your job can easily lead to a financial disaster. The good news is that by following some simple tips, you can minimize the negative financial impact of a layoff, and start afresh. [Read more…]

The Benefits of Investing Early in Your Life

You might have just started enjoying the freedom of getting a paycheck and would be tempted to spend it all on shopping, traveling and having fun. Studies show that many young Americans are careless with their finances. They do not save money, forget to pay their bills on time and do not bother about starting retirement funds. But remember that lack of investments and spending more than your income can be very harmful in the long run. [Read more…]

Investing in Stocks from Emerging Markets

Emerging market stocks from economies that are growing at a fast rate, such as China, India and Brazil have attracted a lot of investor interest recently. I was impressed by how resilient these economies turned out to be as compared to economies of developed nations during the recession. The growth rate of these countries is also far higher than the growth rate of developed nations. [Read more…]