Archive for December, 2009

How To Clean Up Your Personal Finances…

Saturday, December 26th, 2009

Are you one of those people who doesn’t open their bank or credit card statements? Do you take out store cards on the spur of the moment? Have you been with the same bank simply because it is less hassle than changing?

If you have answered yes to any of the above questions, fear not confused consumer, help is at hand, with some assistance from a few internet tools.

* Internet tool number one:

** The consumer champion site for personal finance information

Websites such as Fool.com, Fool.co.uk and Moneysavingexpert.com have proved extremely popular with consumers. Fool.com is more geared towards the US market, whilst Fool.co.uk focuses on the UK market. Both have an extremely diverse selection of information from investment and high risk options to personal finance and low risk options. There are extensive discussion boards, newsletter subscriptions, finance calculators and competitions. These sites not only answer your questions, they make you want to ask more.

Fool.com, Fool.co.uk and Moneysavingexpert.com are community based sites and function on consumers exchanging information between themselves, whether that’s about passing on recommendations or expressing concerns. The article “Ten Reasons To Fear The Future” by Cliff D’Arcy” on Fool.co.uk is a particularly good introduction to the financial aspects of modern life.

Martin Lewis has almost become a household name in the UK through his website Moneysavingexpert. The outspoken journalist and presenter offers a comprehensive resource on a range of personal finance topics. If you can put up with the cheesey photos of Mr Lewis and his catalogue poses, you will undoubtedly find this site extremely helpful.

* Internet tool number two:

** The price comparison site for personal finance information

Kelkoo, moneynet.co.uk and Lowermybills.com (US) are now commonly exploited by consumers to ensure they are getting the best deal on their purchases. However, it is probably fair to say that more people shop around for clothes and music, than they do for their personal finance products, which is worrying as these cost significantly more.

* Internet tool number three:

** Online banking and account aggregation tools

The internet can be a scary thing and there is still much scaremongering about online security. However your details are often as secure online, as they are offline and providing you choose and hide your password effectively – there should not be a problem with people accessing your confidential information. Choose a password of eight characters or more, preferably replacing some letters with numbers, such “1nternet” or “passw0rd”.

Set yourself up with online accounts and you can proactively manage your finances yourself, without waiting for statements through the post or call centre agents to take your query. You can also save yourself bank charges by transferring funds yourself over the internet. Some banks charge large amounts for transferring funds when you can do it for no additional cost at all.

Personal finance doesn’t have to be about debt and the efficient co-ordination of funds may save you hundreds of pounds in the long-term.

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Debt Management – Debt Management Fees

Friday, December 18th, 2009

Debt management fees can vary vastly from one company to another. Knowing what to look for and ask when seeking help through debt management will leave you better off by not making the mistake of working with an unscrupulous agency that charges excessive upfront fees or can’t disclose or won’t disclose why they have structured their fees as they have.

Many debt reduction agencies operate as a non profit organization so why are they charging fees? As a non profit organization there still needs to be a form of income that helps offset the expenses of the particular agency. This is usually accomplished through a nominal monthly fee that an agency charges to their clients. Several states have put a cap on the maximum fee that may be charged in an individual’s certain state of residence. This prevents an agency from abusing their fee structure. Not all debt reduction companies operate as a non-profit company but they are still held to the same standards as far as being licensed to offer debt management services in several states. Find out what your state requires from the debt management provider you are looking into. Are they compliant?

Debt management providers usually charge what is called a set up fee. This is to help offset the cost of getting the client enrolled onto their debt management plan. This process can be time consuming for the agency therefore it is reasonable to expect a nominal charge for that service. However be wary of companies that charge high upfront fees. Typically anything above $60 should be a red flag. Some agencies have been known to charge several hundreds of dollars as a start up fees. What will typically happen in that scenario is the debt management provider will actually keep the first payment you make to them as their fee. Watch out for this as it makes the consumer more past due with their accounts and is an unnecessary fee that usually only result in the client being further in debt.

Make sure to ask if your agency follows state regulations as far as what they charge for their monthly fees. Also ask if they send out the first payment to your creditors. There are several companies that offer a good debt management service at a reasonable cost but there are those that take advantage of their clients. If you are being charge a high monthly amount I recommend shopping around for another debt management provider that may be able to do the same if not better job for you at a lower cost.

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The Right Car Accessories for Your Car Performance

Thursday, December 10th, 2009

Machine performance is not the only thing we need to transform our ordinary car to fast car. All the components on the car give great influence to car performance. However, it does not mean that we should take our car accessories off to support our car performance. To make our car a fast car, but does not lose its aesthetic value, we can choose accessories from light materials or ones that have good aerodynamic function.

Grilles are the accessories that we can replace. We can remove the heavy and solid grilles with mesh grilles. This type of grill is made from woven mesh of stainless steel. The mesh grilles are attractive as well; we can adjust the grilles style and coating with our car character.

To find mesh or billet grills, we can visit Carid.com. On this online store, we will be served with numerous grilles from all materials and styles. Not only grilles, the site serves various car accessories as well. The car accessories collection covers car mats, headlights, wheels, and many others. We can easily find accessories for our car because the site provides accessories for all car brands and types. Check on the site and create your fast, but stylish car now.

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Borrow for Invest

Wednesday, December 2nd, 2009

A lot of financial counselors are now suggesting to their clients that they should borrow money on their home with the use of a home equity loan to invest into the stock market. These people of course are earning a nice big commission from selling the home equity loan and are probably pushing the idea for that reason alone. If you’re being offered a home equity loan at 7% to invest in the market, it probably won’t make sense to borrow that money to invest, but are there ever any situations when one should borrow to invest?

Unfortunately, there’s not a clear and easy answer here. It all depends on your risk tolerance. There’s the risk of investing the money in the stock market, and the risk of incurring additional debt. Some people who are more risk adverse such as myself would choose to minimize our debts and invest later when we have money. Others, such as my room-mate mike, will borrow anything he can at a decent rate to invest in small-cap mutual funds. He might come out ahead with his venture, but no one can say for certain.

It’s just a matter of how much risk you’re willing to take. First, there’s the risk of borrowing additional money. You’re essentially agreeing to pay money in the future for the money that you have now. There’s always the possibility that they money won’t be there to pay off the debt because of a job loss, death in the family, or something of the sort. If you’re debt free, have plenty of savings, and make a good income, incurring a little debt isn’t very risky. If you don’t make a ton of money, already have a car payment and credit card debt, incurring more debt is probably a poor idea. You’re already close to the edge, you don’t need to move any closer to it.

There’s also the additional risk of the investment. Investing in the stock market is by no means a guaranteed return. The $4000 I invested into VFIFX at the beginning of the year is worth about $3978 as I write this. I know that over the next 40 years it’ll probably make a lot of money, but there’s never a guarantee. The stock market could go down significantly in the near future, or it could reach another set of new record highs. We do know that over a very long period of time you can easily average 10-12% in most mutual funds.

When you combine the risk of the added debt and the risk of investing in the stock market, it becomes a major consideration. Imagine if you tried something like this right before the dotcom bubble, lost your job and then your investment when down the tubes, ouch! You could also be very successful if you did this at the right time. If you borrowed money in 1995 and left it until December of 1999, you’d come out with a nice pile of cash from your venture, but you’re never going to know ahead of time.

If you can get someone to loan you the money at a relatively low interest rate and want to take the risk, go for it! If you’re more risk adverse and would rather be certain in what you have , borrowing money to invest probably isn’t for you.

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