Liz Pulliam Weston – Renowned Financial Columnist

Liz Pulliam Weston is already the Web's most widely read financial columnist, and now she's won new recognition for the quality of her work.

Her innovative series of columns on the financial benchmarks that are important for people in their 20s, 30s, 40s, 50s and 60s won a national 2007 Clarion Award from the Association for Women in Communications.

If you missed these fascinating columns, you can find them here:

• Your 20s: See how your wealth measures up
  
• Your 30s: Now's the time to get ahead
  
• Money in your 40s: It's make or break
  
• 8 money moves you must make at 50
  
• 12 steps you must take at age 60
  

The guaranteed way to increase your richness

Basically, to be a Millionaire, we can conclude every of the strategies into two categories. One is the short route, and the other is the long route. The guarantee way is through the long route, unfortunately, almost everyone of us here don't have the patience to go in this route. However, as for the short route, the time taken will be short, maybe 5 years, maybe 3 years. But this route is much more challenged. There are many strategies you can use to be a Millionaire in this short route, you can climb the Millionaire Mountains of your choice.

Now for the long route, it is the surest and easiest way to be a Millionaire. However, by using this route, you will need to wait for a long long time, only then your dreams will come true. Maybe it will take up to 10 years, 20 years, some even 50 years. The problem here is, do you have the time to achieve this? Ok, how can you achieve this? Let me explain. Let's say if you save $1 everyday, then one month you will saved $30. Now, study the chart below :
How $1 Per Day Grow Into $1,000,000
% Interest...............Number of Years Required to Reach One Million
3% .............................147 Years
5% .............................100 Years
10% ............................56 Years
15% ............................40 Years
20% ............................32 Years
Now, you might say, but we need to find an investment that yield at least 10% if we want to be a Millionaire in our lifetime. Yes, you are right, we need to find investment yield of 10%, but the bank only offers us around 3%. So how can you achieve this?
The answer is very simple, let's say if you want to follow this route, you've got the time and patience to make this happen, but you don't dare to take the risk for 10% investment yield. You just need to remember this, in fact, there is not necessary must have at least 10% investment yield, all you need to do is to raise the money that you need to save. Save as much as you can every month, be it $10, $50, $100 or $300. With the right interest rate and given enough time, everyone can be a Millionaire. This proved that everyone, if start saving and keep compounding the money from a young age, everyone can be a Millionaire.
The long route is not what we want here, we want to make money in a faster method, not just sitting and wait for 50 years. It's been proven that with the right strategy, with constant action plus a burning desire, we can be a Millionaire in a short time. But when you're creating rapid wealth, why don't you save your money every month and keep compounding it? We take the short route and the long route at the same time, it's easy and it's simple to save and compound your money. It can be automatically deducted from your bank account. Pay yourself first everytime you get your paycheck, put some amount of money to your investment account every month once you received your paycheck. Then only spend what you have as you wish. And bear in mind of this, don't spend more than what you earn.

Technorati Tags: Money, Personal Finance, Saving, Investing

Benefits of a Home Equity Loan

A home equity loan is often referred to as a second mortgage and it allows homeowners to borrow money using the equity they have already built in their homes. With a home equity loan, homeowners can borrow up to $100,000. The interest on the loan is tax deductible, which brought home equity loans to popularity in the 1990s when the economy was not so good.
There are two types of home equity loans. One type is a fixed rate loan and one is a line of credit. Both loan types have terms ranging from five to fifteen years and both must also be paid in full if the house is ever sold.
A fixed rate home equity loan provides the borrower with a lump sum payment. It’s assumed that the borrower will pay the loan off over a set period of time with interest. The payments are usually paid monthly and remain the same amount over the entire life of the loan. The interest rate also remains the same over the life span of the loan.
A line of credit home equity loan works with a variable interest rate and uses the same principles as a credit card. It generally even comes with a credit card. Borrowers will be approved for a certain amount by the lenders. The borrower can then use this money by using the card or the special checks that the lender will provide. These payments will also be made monthly however the monthly payment will vary depending on what the current interest rate is and how much money was borrowed that month. When the term of the loan is up, any outstanding balances borrowed must be paid in full.
Home equity loans work well for homeowners who need a large amount of money fairly quickly. The homeowner may need the money for such things as paying off another loan, tuition money, home improvements, or other unexpected expenses. Home equity loans are a good option over other loans because the interest rate on them in generally quite low and is definitely lower than the interest on credit cards and other loans. Because of this, it makes good financial sense to pay off a credit card loan while using a home equity loan. It allows the homeowner to have one single monthly bill, a lower interest rate, and a loan that is partly tax deductible.
Home equity loans have many benefits for lenders as well. After the lender has collected on the original mortgage, they then are able to collect more payments and more interest. The lender is also entitled to keep all the money from the original mortgage and the home equity loan if the borrower defaults on payments. The lender is also allowed to repossess the home, sell it again and begin the cycle all over again with the next owner.

Technorati Tags: Loans, Mortgages, Home Equity

Credit Card Debt Consolidation Loans

Debt consolidation is when you take out a loan to pay off several other debts. By consolidating your debts you only have one payment to make. Should your consolidate your debt with a loan?
It depends. You may be able to lower the cost of your debt through a debt consolidation loan. Getting a loan using your home equity or a second mortgage is one way to consolidate your credit card debts..
A home equity loan offers several benefits for consolidating your debt. This option allows you to move all your debt from many lenders to one with a lower interest rate. The credit cards will be paid off in one lump sum, instead of various payments at different times of the month. Additionally, with a home equity loan the interest is tax deductible.
Generally, you will be paying less out of your bank account each month to pay off your debt. Using the equity built in your home lets you deal with creditor efficiently. By having only one payment for your debts, you are better able to keep ahead of your financial burden each month.
Pros of Debt Consolidation
If your credit cards are over the limit with high interest rates and other fees or you have a large amount of high interest installment loans, a debt consolidation loan could be the answer to lowering the interest. This will allow you to roll this high interest debt into one manageable payment.
By having one lower payment instead of several payments, it will be easier to make your payment. Thus, you can avoid the late fees, extra charges and the bad credit that results from payments you can’t afford.
When you consolidate your debts you will have just one or two monthly payments, allowing you to better set up a budget. Your peace of mind is better knowing you can pay your bills without all the hassle of collection calls, late fees and high interest rates.
Cons of Debt Consolidation
Debt consolidation may not be the answer if the rate on your new loan isn’t better than current loan rates.
It can also take longer to pay debts off. When you consolidate debt, you still end up owing the same amount of money. The main difference is usually the length of the term. This could leave you paying more in interest if the term is really long.
Another consequence of a debt consolidation loan is that a loan may be a way to continue to have poor spending habits. If you get a loan to quickly pay of high interests debts, you may be setting yourself up to continue on in the same manner, if you don’t learn to budget and think about the long term.
There are drawbacks to equity loans for debt consolidation as well. If you can’t make the payments you are at risk of losing your home. You might also be tempted to start spending more or getting more credit cards leading into a pitfall you can’t control. This problem could lead to bankruptcy, foreclosure or many other high-risk financial solutions.

Technorati Tags: Debt Consolidation, Loans

Stock Analysis - Fundamental and Technical Analysis

Stock Analysis

What Stocks to Buy?
And
When to Jump-in or Jump-out?

Jump in when it's time to en-cash Growth

 

Even though you can't figure out ahead of time what a company's growth strategy will really be worth, you can get a good handle on what the market thinks. Simply subtract the other two parts from a company's market price. The remainder is the market's current estimate of the growth strategy's worth.

With that information in hand, you can make better investing decisions. In essence, the less you pay for a company's growth strategy, the better your chances of winding up on top. After all, if the strategy comes cheaply, then even if that strategic growth doesn't materialize, the company you're holding is still worth something. And if the strategy does pay off, then you've likely got yourself a company worth more than you paid for it.

That, in a nutshell, is how we value investors gain our edge. We certainly don't ignore growth. After all, no less a value investing luminary than Warren Buffett admits that "value and growth are joined at the hip." Instead, we simply steadfastly refuse to overpay for the growth we expect to see from our companies. By doing that, we ensure that a larger chunk of that growth finds its way to our pockets.

Buy Cheap Growth

Technorati Tags: Markets, Stocks, investment

Penny Stocks Trading - Learn with Small Stocks

Trading with Small Money and Learn

They are risky but they can get you fly also!

Invest in Penny Stocks to start with

The Secret of Making Money in the Stock Market

The stock market is a proven wealth builder and can and should benefit all participants. It is only fair that each one of us should be entitled to a piece of the action.
One thing these traders know is that the market is not an issue of trial and error but a fully quantifiable market by any fundamental Mathematics. You see, when we went to school we learn about the Standard Deviation in probability and statistics. This Standard Deviation is Mathematics and is quantifiable in modern science. Standard deviation was introduced by Mathematician Karl Pearson in 1893 although the idea was by then nearly a century old. This is the single most important idea that should explains all those mysteries, myths and legends you hear of in stock market.
Everything on this planet has properties and, or, characteristics. A stock, just like you and me, has properties and these properties are quantified by calculating the Standard Deviation of the stock. It varies from stock to stock. Our brains are lazy and what we can not understand we turn to astrology which gives our brains a rest. Rather than use planets in signs of the zodiac and financial astrology, or imagining of the latest rumors, invest that time in the study of probability and statistics. If its not you to study, who should? Probability and Statistics is that study that has to do with tossing a coin to get a tail or a head. And as simple as it may sound, tossing a coin and getting a head for only two consecutive times is an extremely very difficulty thing contrary to what our lazy brains would want us to believe.
Standard Deviation is all about vibrations. Vibrations is like in music, vibrations in a string, water vibrations, earthquake vibrations, light and electromagnetic vibrations. The stock market is like vibrations too. For the price to move it must vibrate. The stock spends a lot of time vibrating in a neutral sideway range which unfortunately we do not like. We want the stock to go to the roof the next day after we have bought it. Vibrations are waves. Waves have crests and troughs and travels from one price to another. One crest is often followed by a second crest which is followed by a third crest and so on and so forth. Every crest is separated by a trough to create an alternating pattern of crest and troughs.
Like a bouncing tennis ball, a lower bounce than the previous bounce means the ball is coming to a halt. In the stock market, strength is quantified by series of crests where each crest exceeds the highest point of the previous crest and weakness by series of troughs where each trough goes lower than the lowest point of the previous trough.
People out there will tell you to trade in the direction of trend and they go further to say getting the trend is easy: do this and that. Contrary to the believe that determining the stock's trend is easy, in real time this is very difficulty and you can not have a probability of 100%, otherwise each one of us would be a winner in the market. Some investment advisers and the media are either oblivious and always bullish or immoral, merely giving the public what it wants. It ’s only a question of, is it this group of stocks or that group, this sector or that sector?
Back to crests and troughs. Whenever two crests meet up with one another they produce a bigger crest which is constructive, and, whenever a crest and a trough meet one another they tend to cancel each other producing a smaller trough or crest which is destructive. If you have ever wondered why carpenters saw the wood in the directions of the grains rather than up against the grains, wonder no more - these guys find it easier and the bundles they produce are sliced clearly leaving a smooth surface with minimum defects.
A bigger crest or trough is made up of smaller troughs and crests. How many of the smaller ones makes the bigger trough and crest is the puzzle that will make our lazy brains consult astrology. Lets leave that as it is because the market moves yoyo up and down, so we comfort ourselves.
The real forces that move the markets are the moving averages. They are a measure of accumulation of strength and weakness over time due to news, economic growth reports, manipulation, fear and greed. There are many moving averages just as there are different types of traders. It is through the dynamics of the moving averages that there are crests and troughs. The bad thing about these moving averages is that they only tell us about what happened rather than what is happing.
One of the most successful trading tool since time immemorial is multiple moving averages crossover, and the acceleration in all averages is either positive in all averages or negative in all averages that you are using. If the acceleration in averages is positive, you go long, and if the acceleration is negative, you go short. This really is multiple time frame where you trade using the shorter trend but only if the longer trend supports it.
Good trading requires you to have safety measures upfront. Always make sure that every trading position that you open has a corresponding stop loss order, repeat, every position that you open has a corresponding stop loss order. I can repeat this until breakfast tomorrow. Trading without stop loss orders is like driving an automobile with faulty breaking system. Every now and then check to see if your stop loss orders are still active. If your broker's system fails, when it come back it may come without your stop loss orders. These stops are not free. It is among those fees that should keep your broker in business and you should grandly pay him even if your stops are rarely used. And why not? And talking about brokers, get yourself a good and inexpensive broker. There are many out there. A broker who charges more than $1.0 per 100 shares of stock is expensive and if you are paying more than that, then you will develop fear of exiting trades as you contemplates the broker's commission you are to incur. A good broker should embrace modern technology and you should promote them because if its not you, then who? And never get married into certain stocks. A company and its stock are two very different things. A stock that is not making money for you is not a thing. Throw it to the dogs.

Technorati Tags: Markets, Money

Wealth Building with Market?

Beginners should avoid complicating things trying to get rich in a day by venturing into every nook and cranny without knowing a thing or two about them.
To begin with, you need a broker to handle your trades – individuals don’t have access to the electronic markets. Your broker accesses the exchange network and the system finds a buyer or seller depending on your order. Choose the right broker rationally. This is a crucial point of money making from stocks.
Making money from stock markets requires trading in the stock market. Cautious buying, holding and selling of stocks generate profits and money. Stock trading is the function that interacts and organizes in the stock market.
As a beginner, you must understand in effect how the market works. You really don’t have to know all of the technicalities of buying and selling stocks.
Fresh business ideas just don’t come on like a light bulb; ideas only click the mind by exploring the business market. eFunHosting contains articles about ideas, tips and tricks and market news to only update a businessman but also brainstorm fresh business ideas
This market involves buying and selling of millions of shares all over the world, and generates profit.
The first and foremost you need to know is the functioning of the exchange floor, irrespective of whether you trade through the floor or electronically.
When the market opens, hundreds of people are seen fast moving about shouting and signaling to one another, staring at monitors, and entering data into terminals, or busy on cell-phones on the exchange floor. It looks like a complete fiasco. However, by the time the end of the day approaches, the market has worked out all the trades, and is all set for the next day.
These are the steps in a simple trade on the exchange floor of any major Stock Exchange:
You instruct your broker to buy a number of shares of a company at the current market price.
The broker’s order department passes the order on to their floor clerk, the dealing official, in the exchange.
From this person it goes to one of the firm’s floor traders whose task it is to find another floor trader wanting to sell that number of shares of the company you wanted. Each floor trader has particular knowledge of which floor traders deal in what stocks.
The two come together on a price and seal the deal. The notification process moves backward along the line and your broker gets back to you with the final price. You receive the confirmation notice in the mail after a few days.
Beginners should avoid complicating things trying to get rich in a day by venturing into every nook and cranny without knowing a thing or two about them.
To begin with, you need a broker to handle your trades – individuals don’t have access to the electronic markets. Your broker accesses the exchange network and the system finds a buyer or seller depending on your order. Choose the right broker rationally. This is a crucial point of money making from stocks.
Depend on your comprehension and your broker, who must be a professional. Never bypass understanding fully the cause(s) behind a bad result when it occurs. Learn from your experiences, document them, and keep reading them once in a while.

Technorati Tags: Markets, Stocks

Lowering Your Credit Card Debt

Most of us have accrued a significant amount of credit card debt. Of course, I'm sure we've all heard that more than once, right? It's become quite personal, correct? I bet your high credit card debt is driving you crazy.
Alright, take a chill pill. Don't be so fast to file for bankruptcy. Bear in mind that it's most advantageous for your creditor to work with you to bring things back into line.
So, below are a couple of ideas to help you manage your credit card debt:
Foremost, get in touch with the company that issued your credit card. Let them know about what is going on with your finances. Request that they lower your credit card interest rate, or request a lowered payment plan in order to repay. Quite often people don't think of this because the are normally polite. It's to your advantage to keep courteous when speaking with your credit card issuer. Stay firm, and polite, but conduct yourself in a manner that says "I know exactly what I want and I expect to receive it". If you have any doubts about what you might be asking for, you might consider taking the time to contact a credit counseling service with a good reputation. There are many honest firms out there where the #1 purpose is to help you in working with your creditors.
Ok, now stop the credit cards from being used. Tear them up, or run them through the shredder. Do whatever you need to to keep them from ending up in your wallet or purse. Allowing them back in there will only create more temptation for you to use them again, perpetuating the problem even more.
Actually, this can be one of the most difficult parts of lowering your credit card debt. You seem addicted to spending money that you don\'t have available to spend. So, you have to quick the habit- COLD TURKEY.
Begin paying the credit cards off with the higher interest rate first. Work down from there. How is that done? Focus your efforts on the high interest rate credit cards by paying more than the minimum payment each and every month. The minimum amount is just designed to keep you enslaved for longer, anyway.
Credit card issuers aren't in business just to lose money. It's in their best "interest", contrary to yours, to keep you making payments for the longest amount of time possible. If you can just pay a small amount each month, it's better in the long run than just skipping the payment.

Technorati Tags: Credit Cards

Tax Lien

A lien on a property is the most usual type of lien but by no means the only type. For example when you take a loan from a bank to finance a car, the bank can put a lien on the car to ‘ensure’ repayment until all remaining payment is made.

The same applies to financing a house through a bank. The lien gives the bank the authority to repossess the house if you are not able to make the installment.

A tax lien is imposed by law on property to assure the payment of taxes. They may be imposed on real or personal property for non-payment of taxes and/or the failure to pay any type of taxes on the property including income taxes.

A tax lien on real estate ‘runs’ with the property owner. It means that the new property owner is accountable for paying the taxes even though the tax was sustained by a previous owner.

The laws on tax lien varies from states to states but the owner of the property may be personally liable for the remittance of all unpaid taxes. This can be made by the property owner or indirectly by the mortgage holder. Plenty of notices are given to ensure that both the owner and the mortgage holder are appraised of the situation.

If a tax lien on a personal property is not settled within a designated time, the property may be confiscated and sold at a foreclosure sale. This usually takes place after several warnings are given and attempts are made to establish contact and/or payment. If a property is sold by the owner prior to tax foreclosure, the tax lien is most often paid as part of closing costs from the sale proceeds.

One of two methods may be used in dealing with the result of foreclosure on a piece of real property. The property may be seized and sold in what is called a tax deed sale. The other method can differ from state to state but the tax lien may be optioned to investors in the form of what is called a tax lien certificate. This accompanies the right for the investor, after a specific period of time has passed, to begin foreclosure proceedings. This is known as a tax lien sale.

It makes good sense to make sure that your property taxes are paid on time to avoid the trouble of dealing with foreclosure proceedings. And it also makes great sense to check that the property that you plan to purchase does not have a tax lien on it unless you are a investor trying to make a huge profit by purposely investing in tax lien.

Do you want to be wealthy finally?

some of the wealth demons that could be keeping you from getting rich. Here are the big players; 1. Fear 2. Indecision 3. Laziness 4. Bad Patterns 5. Arrogance 6. DisappointmentWealth Demon One: FEARPlaying it safe has screwed more people out of their dreams than any other factor I can think of. I have seen people with no talent that bring nothing outstanding to the table excel and make a big name for themselves through nothing more than sheer guts. They just have no fear of rejection, failure, success or in other words they just keep on coming like a determined dog after a bone. When you want something so bad that all obstacles are merely interesting puzzles to be figured out and not mountains of woe, you are on your way.Chances must be taken because fortune favors the bold. People that play it safe are the mainstream of society. This is the way things run from day to day. People wake up, go to work, pay the bills, and the machine of society keeps on churning in a predictable and easy to manage way. Most people like it that way. For the rich and those that are about to become very wealthy, the right chances taken every day are exciting and can be very rewarding. When you feel fear, you are in the right territory. Fear keeps the mainstream middle class society in their place and leaves the loot for you and I to enjoy. Leading us into the next point, remember that fortune favors the bold, not the stupid. There is a big difference.Wealth Demon Two: INDECISION –THE PUPPET MASTERStocks are going to crash, the real estate bubble is about to burst and your mattress is the only safe place to keep your money. Unless your house starts on fire, so you better bury some money in the back yard too. The puppet master demon will keep you chasing your tail with doubts. These doubts will keep you from committing to any particular stream of income opportunity. Diversification is fine if you have enough resources to allot a fair amount to each, but it you never take the chance of putting a large amount of your eggs into a central money investment you will never get the big payoffs. Better yet, lets move onto point number three. That's laziness and if you stop being lazy, you can learn how to invest without using much of your own money at all.Wealth Demon Three: SLOTH –THE RULER OF LAZINESSGetting rich and making a ton of cash isn't really that hard. Its not hard once you learn a bit about how it all really works. Guess what though? You cant learn the system if you don't get off your butt and do some learning. Shut off the T.V., get off the couch and go to the library. Find the books you need to learn the system of wealth and money. Find the book that answers the questions about money that have you stuck where you are now. Beating laziness becomes easy once passion bites you. Once you get a sniff of what is possible, Sloth wont have a chance.If you don't know where to start, then start general. Pick up a title that looks interesting and while you are reading that book, see where you get stumped. Is it the part about no cash down mortgages or is it the part about no load mutual funds? Wherever you are short on the I.Q. of wealth and money, get proactive and get the ammo you need for your upcoming battle.

Real Estate Investments - Investing in Land

It is really surprising that more people aren't prospecting in land. With cities growing rapidly to encompass areas that were once suburbs, land is really at a premium and those who purchased land years ago are seeing their investments bringing in top dollar from developers who are in need of space. Land prospecting has long been a mainstay of the real estate industry and in reality more money has been made from raw land than anyone realizes. If you are one of those people who is interested in real estate investing then perhaps raw land is something you should check into. Think about it this way. The population of this country is rising fairly quickly and with that rise in population comes a real need for living space, shopping space, recreational areas and so on. Simply put there is a need for land to develop. As cities grow more and more of the suburban and rural areas are being developed. In addition many people want to live outside of the major urban centers and so rural land is being gobbled up to make subdivisions, gated communities and new cities/towns. All of this development requires land that has to be purchased from someone. Why not from you? Take a look at your local area and how it is expanding and then set about looking for undeveloped land around the outskirts of the area. Chances are there is a fair amount of open area that is available for purchase. When thinking about this type of land it is imperative to consider whether or not you will have to clear the land and if it is a sizable portion then this can get costly. Many people who do this subdivide their land and sell it off to developers in pieces and this can bring in an incredible profit. Buying land is relatively cheaper than buying homes and you can usually find some great deals in areas that have not been considered for development yet, the trick is to think ahead to where development will be necessary in the future. Even if the land is not slated for development, the appreciation of property will continue to assure the value of the purchase. Get in on land prospecting, it could just be your ticket to a successful investment.

Thinking Like a Financial Planner

Even if you do not think you are a financial planner, you better start thinking like one fast. In the United States, there is an approximate of 5.6 million people who are either self-made millionaires or financially independent. And what is so hard to believe about that statistic, you ask? This is because that is only about 5% of the American population.
The remaining 95% of the American population (we're talking about 106.4 million people here!) are not only not rich, but most of them are facing financial disasters, either owing to poor financial planning or foolish spending!. This is why you should start thinking like a financial planner. Financial planning is not so complicated, and it can make a huge difference in your life.
As the saying goes, "failing to plan is planning to fail". Much of the same can be said if you do not plan your finances well, it does not matter if you are a high earner, you still need financial planner skills, to keep you form harms way and to ensure that your life will be financially secured.
The fact of the matter is that financial planning Is Not An Option, most of us need to think ahead today, and you should practice your financial planner skills right away to enjoy the money you make today in the future.
The basics of financial planning is to keep all your finance in order, this is very basic advice, alright. However, more often than not, we would rather concentrate on other things in life such as health, studies, work and more.
Think about the things you want to achieve in life, and how you are going to get there, financial planner always set his goals and puts some order in his thought before starting to actually put the wheels in motion. Financial planning can include buying a house, paying for your children education and thinking about a retirement fund.
Financial planning will help you use your current pay check and your saving to start working on a program that will give you peace of mind on the financial level, a financial planner will plan a budget according to every household’s expenditure budgeted and a savings plan drawn up, this will help you spend your money wisely and effectively.
A financial planner will consider having savings invested in an investment vehicle that pays higher returns than the normal bank account, it will add in some muscle to your savings and help you reach your financial goals in a shorter period of time.
By starting your retirement planning now (not later!), you can gauge how much money you will need to maintain your current lifestyle and where this money will come from. Many people, especially those who have just started working, always put their retirement planning on the back burner for reasons such as “I just started work” and “Oh, I am still young”.
Many, however, fail to realize that by starting early to save for retirement, you will be able to save and invest more due to the magic of “compounding interest”, provided that you invest your savings wisely. Maybe you do not have to wait until the age of 65 to retire. For all you know, by the age of 40, you might have already reached your financial independence and do not have to worry about getting up early to clock in or work until late hours because there are deadlines to meet.

Technorati Tags: Finance

Mutual Fund Classes - Why it matters?

Class A

Class A shares typically have a front-end load or a charge that is incurred when you buy the shares. The fees are charged as a percentage of the amount invested and sometimes can be lower if you are buying more shares.

Class B

Class B shares normally impose a contingent deferred sales charge, or back-end load that can decline the longer you hold your shares. Now, while this might seem to be a less expensive way to buy shares, it can pay to check what other fees are charged. According to the National Association of Securities Dealers Class B shares may have higher expenses than Class A shares. Additionally there may be a sales charge when the Class B shares are sold. If held for a long enough time, Class B shares often convert to Class A shares with lower operating expenses.

Class C

Class C shares, which often are used for asset allocation, do not charge a front-end fee but do typically charge higher operating expenses than Class A shares. Additionally there may be a sales charge if you sell within a certain period of time. If Class C shares are held for a long time, the costs could be higher than either Class A or Class B shares.

Technorati Tags: Investing

Debt Consolidation for starting Freelance Business

Most business advisors recommend that a new business owner sock away enough money to support himself for a year or more before embarking on a business.
This does not mean that the business will not take in money, even early on. The usual course of small business is that business starts slowly at first and builds, often in fits and spurts. However, small businesses will have a disproportionate amount of expenses in these first months and years.
You'll be surprised by the expenditures you'll have in the first year; you have to buy all of your equipment, supplies, permits, software, and so on. These seemingly minor items can end up costing you thousands of dollars. Covering those expenses can be tough. Even when a new business starts to earn money, it is not unusual for it to post losses in the early months because necessary expenditures simply outpace earnings.
Besides saving money for the day you start your business, you should also work very hard to reduce your personal expenditures. Anything that can be paid off before you start your business should be paid off. Besides, it will be good practice for the new business owner to practice living more frugally! Most new businesses will take a lot of financial flexibility and learning how to live on less is a great skill that just about every business owner will tell you is important.
If you have debt (and who doesn't?) you may want to consider something known as debt consolidation. Before you get riled up, debt consolidation is not bankruptcy or debt settlement. It's a perfectly legal, ethical way to roll your many small debts together in one package and then negotiate a better loan on the large amount. The idea behind debt consolidation is that you may be able to restructure (consolidate) your debt in such a way that you will have to pay less interest to pay it off.
Debt consolidation won't hurt your credit report. In fact, it could actually improve it! That's because debt consolidation means you get a big loan to pay off your smaller debts. Paying off a debt usually improves your credit. And if you manage the larger debt consolidation loan well, that will help your credit, too.
By the way, a good credit score is essential for a new business owner!
But how does it work? In theory, you gather your debts. Let's say you owe $5,000 on a department store credit card that charges 22% a year interest. That may sound exorbitant, but it is not all that unusual. The interest on a loan like that is $1,100 a year!
Let's say you have some other loans. For the purpose of illustration, let's say you have one credit card maxed out to $10,000 at 16% ($1,600 interest a year) and another credit card that charges 14% where you've charged $3,200 ($448 a year in interest).
Put these three amounts together and add them up. You'll end up with $18,200 in debt. Now let's just say for theory's sake that you can find a new loan for $18,200 that charges just 12% interest. You get that new loan, use it to promptly pay off your three charge cards, and now you pay off the one new loan. By the way, 12% of $18,200 is $2,184 in interest a year.
Consolidating that debt saves you $964 a year in interest. You have to pay $80 a month less. If you are really savvy, you'll take that $80 and apply it toward the principal. You spend the same exact amount of money, but you will get out of debt significantly faster.
That's a small picture of debt consolidation. You can also roll in car notes, student loans, medical bills, and other debts.
Of course, debt consolidation can be tricky. First, it may not work for you-you may owe money but at rates that are already as low as you can get. Second, you might want to get a lower-interest-rate loan but cannot qualify. It helps if you own your own home, but even if you do not, there are other ways to consolidate your debt.
If you can consolidate and pay off your debt, you'll have a tremendous business edge, one that is hard to appreciate until you've been in business for a while. The lower you can reduce your expenses and the more adjustable you are to living modestly during the early years of your business, the more freedom you'll have and the more time you'll have to give your business the start it deserves!

Technorati Tags: Finance, Money, Debt-consolidation

Investment and Saving Tips

Index Funds? Is it really good? How Much?

Index Funds are very safe and rewarding funds for safe players who don't have much knowledge of stocks/mutual funds or don't have time for that.

But, as these Index Funds are aligned with American Biggies it doesn't show large growth or reward potential. So, if there is any Index Fund investing in Mid-Cap or Small-Cap that would be real good to go. e.g. ING Direct has Index funds in all 3 segments Small Caps, Mid Caps and Large Caps.

This small move can fetch real good rewards with almost the same safety.

Diversifying from Stocks to Real Estate

It's called a Real Estate Investment Trust or REIT.

Vanguard's REIT Index Fund (VGSIX), which has a dirt-cheap expense ratio. With a $3,000 initial investment, your fund only costs a measly 0.21% per year -- a huge advantage over the average expense ratio of 1.55%. On a $3,000 investment, that means you'll pay just $6.30 instead of $46.50. Another bonus: This fund has a total return of more than 288% for the 10 years that ended with May 2006. Or You can cash in on streetTracks Wilshire REIT (RWR), whose gain of 31% for the 12-month period that ended with February makes it a "hot property!".

Dividend Reinvestment Plans (DRPs) and their cousins, Direct Stock Purchase Plans (DSPs)

More than 1,000 major corporations offer these types of stock plans, many of them with fees low enough (or free) to make it worthwhile to invest as little as $20 or $30 at a time. DRIPS are perfect if you only have small amounts to invest and want to make frequent purchases (a strategy known as dollar-cost averaging). Once you're in the plan, you can set up an automatic payment plan, and you don't even have to buy a full share each time you make a contribution.

Save on Broker Cost

At Merrill Lynch "representative-assisted" (that's "broker" in plain English) trades cost $85 per transaction (plus a per-share surcharge) if you're buying 251 to 500 shares. Make just 10 trades in a year and you've given $850 of your hard earned dollars to your broker. But make those same trades using one of the online brokers below and even at the highest commission, you're paying just $199.50.

You can go online brokers like Fidelity, ShareBuilder, TD Ameritrade.

Great Advice of Diversification for New Bies from Tom Gardner

Take $5,000 and open a discount brokerage account, paying something like $10 per transaction -- and spread it across 15 different investments including: funds, larger individual names that pay a dividend and smaller companies that most Wall St. investors aren't watching.

15 names? That's only $333 per investment on average. That's OK because diversification is the key to your long-term success. Tom Gardner (Motley Fool CEO and co-founder) should know. He says "by spreading out your money, you also beat away the speculative instinct." Highly diversified people end up realizing that their stock investments are a lot like a bank account with much, much higher interest rates.

A real small tip for buying any good Stock

With a stock-price way below its 52-week high would surely reward us while tending to reach its 52-week high again. So, any good stock like Apple or Dell or Intel would be a good purchase when they go way below its 52-week high.

Recycled Gold: A Hot New Investment Strategy

Away from Wall Street and the stock market, investment professionals understand that although they can spread their bets across sectors and industries it is hard to distance oneself from the overall economic climate of a country. That is of course unless you invest in commodities such as gold. The reason for this is that gold, like currency has the same value anywhere around the world, and a value that is generally immune from economic forces such as interest rates and employment. The use of recycled gold is not just for jewelry as many amateurs believe. Gold is used in many products, such as satellites for example, because of the unique qualities that it has. Gold is naturally corrosion resistant; however it is also very soft. This makes gold an ideal candidate for being used as an alloy or compound where its qualities can be mixed with another metals to yield strong results. For those reasons, as well as its aesthetic qualities, gold is always needed and its price is generally affected by both supply and demand alone. The reason for this is that it is needed in countries around the world, so only an overall drop in the world’s economy can have an affect.

Because gold is heavily commoditized, this means that scrap gold has a value based on the weight of gold that you have. For example, an old necklace made of gold does not just have value in terms of what someone may pay for the necklace. It also has value in terms of what someone would be willing to pay for the weight of gold that it is made of. For those reasons alone, pawn brokers and cash day advance companies are happy to give gold a value, without being worried about their ability to resell it in jewelry form. You see, gold is also a highly liquid market. What does this mean? Well when a stock broker buys shares in a company he does not just consider value based factors, he also considers how liquid a stock is. This mean, how often it is traded. A stock which is not traded very often will usually be much more difficult to sell when it comes to a time that one would need too. Because gold is bought and sold all the time, there is never any difficulty in being able to sell it.
For those reasons and more, businesses and high net worth individuals have invested in gold for the past 5000 years. Now buying recycled gold can have more value because an individual can pay less for the gold, because of the perceived cost and inconvenience of turning it back into pure form. That is where the market is, and as something which can be sold easily it is a business which is easy to scale when you have all the fundamentals in place. It is also the case that because everyone is not aware of the commoditized and liquid market that exists, people you are buying from might not know how easy it will be for you to make money they could otherwise make.

Does Debt Consolidation Service Work?

If you have applied for a credit card, which you got it the following month. You involved yourself into equity speculation and you lost big. You applied for more credit cards and you are just paying the minimum sum each and every month. The interest is killing you and you are in an absolute financial mess. Well, from a personal financial management point of view, individuals are experiencing these are facing bankruptcy.
However, there is this miraculous solution that has been showed on TV as well as on papers that seems so convincingly that this is your only chance. Well, it can be a chance as well as a bottomless pit. Do you think a finance company is going to you solve your problem for charity. Needless to say, nobody in the right mind is going to lend you such a hand without some tradeoff involved. Because by putting your leg into this solution, although it holistically centralized your debts into one single debt, it does cost some money, which is substantial enough to make you way poorer than, you already are. Why let someone manage your debts for a price.
Debt consolidation solution offered by finance company may not really work, as it is just another service to earn your money, thus making you a few thousand of dollars poorer. However, you can actually try to take a loan from banks or finance company by mortgaging your house as a form of collateral for paying off the other miscellaneous debts that incur comparatively high interest. This is just one way, which you can take and not paying any consolidating planning as well as solution that even a kid would probably understand.
Well, if you do not have a house, approach your creditor to work out a way to repay your debt. Chances are, they are going to work it out with you, because it is just not cost effective for them to issue that letter of demand through lawyers, which could cost more than the money, you owe them.
As you can see, there are many other alternatives that you can actually take instead of debt consolidation service. But the most prudent thing to note is never get yourself in such mess. Take debt consolidation as a form of last resort.

Debt Consolidation, Finance, Money

Calculating Debt - To - Income Ratio

Avoiding or Reducing Debt has always been a priority.

When we go to a bank to borrow some times they say that our debt ratio is to high. Basically what they mean is that our debt payments are more then 40% of our income. When the banks are calculating debt ratio they take in to consideration your credit cards, loans and credit lines. If you have mortgage with other bank and not add it to the total Then your calculation will not be accurate.
We can calculate oour ratio like this
Debts
1) 5 %of all credit cards available credit
2) 5%of all Credit lines available credit
3) Monthly mortgage payment
4) Monthly loan payments
5) Any other debts .

Add all this up and add up all your monthly income and then calculate your percentage of debt to your income if it is near or more then forty do not borrow any more.
Also add your insurance to this because it is also a fixed payments that way you have an exact figure of your debts.
Banks calculate your debt ratio similarly but it may not be a correct picture because you may not be using your credit cards or you line of credits at all so this is not providing you with an accurate picture. Hence remember one thing if you are not using your credit cards cancel them keep only one or two cards same goes for credit line keep only the one with low interest rate close all others.

Online Savings!!

Yes, Shopping online can save you more bucks. Search for online order deals.

You can get online coupons to print and use at a nearby store or you can get an online deal which offers a discount if you order online.

There are few sites that can help you find such deals.

http://www.bradsdeals.com

http://www.ebates.com - offers coupons & cash-back

http://www.edealinfo.com - great deals and coupons

http://www.valpak.com

http://www.stealprice.com

http://www.dealnews.com

http://www.streetprices.com

http://www.restaurant.com - Deals for restaurants in your area.

http://www.theatermania.com

http://www.stubhub.com

http://www.dealcam.com - Camera Deals

http://www.dealmac.com - Mac or iPod deals

Technorati Tags: Savings, Coupons, Deals, Online Savings, Online Deals, Online Discounts

Investing in Small Caps

70 Times Better Than the Next Microsoft

That's a persuasive case for putting small-cap value stocks to work in your portfolio. (We'll get to just how persuasive later.) And you've probably seen plenty of other data showing that small caps outperform large caps and value outperforms growth. Why, then, doesn't small growth outperform large growth? And why does small growth, on average, end up being the worst choice for your money?

Moneychimp.com offers a theory, and I think it's worth seriously entertaining, at least when it comes to how you invest in small caps. Just think about how investors might mentally categorize large- and small-cap value and growth companies.

70 Times Better Than the Next Microsoft

Could A Family Live On A Single Income Source?

Many families dream of having one parent stay at home to raise the kids. The idyllic picture of having mom (or dad) home, taking care of the kids, cooking great meals, keeping a beautiful home, is hard to resist.

It's also incredibly difficult financially.

However, in many cases it can be done. And with practice the sacrifices you make may not seem so bad. You will probably take fewer vacations, and they'll be simpler. You will probably eat out less often. You will probably buy fewer things. If you and your family can live with that, you will probably be able to cope.

Provided that you can make the remaining income stretch to cover your necessities. You need to look at this to make an informed decision. Here are some steps to take.

1. Collect 3 months' worth of pay stubs from the person whose income your family will be relying on. Use this to calculate your average monthly income.

2. Collect 3 months' worth of bills. If you like, you can separate this into more or less fixed bills, which are things such as rent/mortgage payments, water bills, electrical bills and so forth, versus other expenses such as groceries. In any case you need an average of what you are paying out every month.

3. Subtract your average monthly expenses from the average monthly single income. Will it work?

If not, don't despair. There are often areas you can cut. When you have two incomes it is easy to spend more than you absolutely have to.

You can start with monthly bills. Do you really need cable television? What about having both cell phones and landline phones? Perhaps your family could get by with just one or the other.

Now look at the other things you spend money on monthly, but don't come in the form of bills. Can you cut that grocery bill down? Do you tend to buy more clothing or new electronic gadgets you don't need? What bad shopping habits do you have? Can you give up Starbucks?

Try to work out a budget that will work with the money you would have as a single income family. Then before you are actually a single income family, try living on it. Put the extra into savings. It makes a nice cushion for if things don't work out and for when those extra bills that you really can't plan for hit.

It takes time to learn to live on a single income. It is very possible for many families. It takes planning, both in terms of finances and in terms of what is expected from each person, but it is highly doable. And having the ability to have one parent there for the kids is just a delight.

Technorati Tags: Money

Exchange Traded Funds - Index Funds

An exchange-traded fund (ETF) is a type of index fund that is traded on the exchange like a stock. This could be considered as safe investment because we can assume that index is not going to be negative in the long run.

Most of such funds track indices. S&P 500 Index, Dow Jones Industrial Average

and NASDAQ 100 are few popular among them.

ETFs don't need to manage the funds as it directly relates to Indices or some other average.

Investment returns may still depend on the duration and time of your investment. ETF investments are more suited for large investments due to its trading costs associated with investing in ETF. So, it's good for those who consider this as a stable investment.

Technorati Tags: Finance, Investing, Investment, Index Funds, Mutual Funds, Stocks, Exchange Traded Funds