Majority of debt management programs (DMPs) were devised in accordance with the new bankruptcy regulations in 2005. From that time, numerous debt management programs have gone bust as a result of bad management and deceptive practices. For selecting a debt management program and making it work for you, you can go by the following steps and take advantage of them.
Step 1. Select a well-known and trustworthy debt management program. Verify with the State Attorney General’s Office of Consumer Affairs and the Better Business Bureau (BBB) for information about the debt management company.
Step 2. Work in close coordination with the financial counselor to formulate a practical budget and set objectives that can be accomplished. You should only work with your funds and income without forecasting tax refunds, windfall gains and so on.
Step 3. Request for an elaborate and written contract that includes all the details, assurances, commitments and a list of debts and creditors. You must turn down any contract that contains verbal promises. You should always have it on paper.
Step 4. Communicate with all your creditors to ensure that every creditor approves the debt management program. Remember that no creditor is bound to agree to a proposed debt management plan and might decline or a give you a counter-offer.
Step 5. Keep contact with your creditors to guarantee that payments are sent on time and the account stays current. You must remember that in spite of a debt management program, your personal liability towards the creditors remains the same.
Step 6. Check out modified interest rates with creditors and ensure that over the limit fees and late fees have ceased. Evaluate the monthly statements cautiously. Talk to the creditor initially and then talk to your financial counselor if you have any queries.
Step 7) You must have a steadfast commitment towards making regular payments for the debt management program. You can make arrangements for an automatic debit facility from your checking account to ensure regularity. Handle your personal finances carefully and follow the budget formulated by the financial counselor.
Contributed by Debt Community Member.
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How Can You Make A Debt Management Program Work For You?
Learning to Invest - What You Must Know
People have different reasons why they would like to try investing. For sure, you have your own motivations like preparing for a comfortable retirement, saving for your child's college expenditures, buying a house etc. This is a good start in arranging your business portfolio. The next step that you must accomplish is learning to invest in the most productive way. This is done by structuring your finances to make it feasible to invest and then gaining knowledge of the intricacies in investing.
Once you invest, you do not only lay down your money, you also devote your time, effort and trust to achieve your objectives. Investing does not only delineate business matters, since you can invest your intelligence in your craft, you can invest your time in your study or invest your love in a relationship. But when it comes to business, investing is about putting your hard earned money in mutual funds, bonds, stocks, certificate of deposits or even in non-conventional investments like the real estate market and eventually attempt to get their returns over time. Investing funds incorporate placing your money into some form of assets or securities. Learning to invest is a great tool to prepare for your future because you appreciate your resources more while you use your money appropriately. Since you already know that investing is a smart thing to carry out, you should initially check if you have debts. Of course, when your investing venture becomes successful you'll be able to pay all your debts, though you should understand that it doesn't make sense to save some funds while your debts are continuously increasing. It's critical to pay off all your loans or debts before you get your hands on any of the investment vehicles.
Investing involves wise planning and setting of goals. Before anything else you
should be able to answer the following questions:
What are your monetary objectives and goals?
What is your time frame to realize the returns of your investments?
What forms of investments do you prefer?
How much money will your investment need to achieve your aim?
How much time are you willing to devote in managing your investments? You should be able to answer these questions sincerely. Keep in mind that you are not only putting your effort and time to invest but you are also placing your family's future in line. Make sure that you are willing to give what it takes to become a successful investor. Although, you have heard of many success stories from your acquaintances after they have entered the investing world, this may not be the same outcome that will happen to you especially if you are not serious with your business.
Learning to invest is easy to attain, particularly because of the overflowing online and offline resources that can give you handful information on the right steps to take. You should look for the most suitable investments for you. Go for something that interests you and appeals to your way of living. When you arrange all things accurately, you'll definitely retire rich and comfortable with your loved ones.
Bock Hamilton
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Investing Money Strategies - What Are They?
Think of investing money for your retirement as early as the time you had your first work. If you put 10 percent of your salary in investment in the age of 18, you can guarantee yourself worry-free times when you reach the age of retirement.
You always look at the record everyday and almost afraid to know the latest. The thing is, you don't need to do this everyday. In fact, investors don't have time for good times. They spend their time monitoring their stocks everyday. The good thing is, you don't have to do the same because investing is a long-term play.
Surely you will be worried on the updates, news or injuries your stock might suffer while you are not monitoring. But with investing money strategies, you will find stocks that will do well after months even though which path the market leads.
Stocks that produce earnings are practically the ones that perform well. However, those companies that earn fast need constant monitoring because they always likely to hit hard when growth slows down. So instead of investing there, try to invest to companies that grows a little slower. These companies are usually ignored by investors especially when they have big capital. These stocks usually earn 5 percent growth in a specific year, not 20 to 30 percent like big companies receive and what investors seek. To find out what are these moderate earners, you can check analyst's forecasts of earning.
Even though earning increase makes the share price, earnings figure does not conclude everything. The measures of return on investments or the profitability is important. ROIC or the Return on Invested Capital is a ratio of profitability used to compare net income over investors' equity adding the lasting debt. It is the ROIC you received in your asset when you purchased the company and compensated the debt.
A good dividend can provide support to the price of share at times of market downtrends and certificates & funds downfall. But to be efficient, your safety net needs important share yield and a little threat on dividend cut. If you purchase a share, your share yield will be the price of dividend you are expecting to obtain after twelve months or a year divided by the price when you bought it.
If you have little knowledge about terminologies and how the investment world goes, it is better to study first about investment. Read books, there are countless books discussing the topic. Search the internet and watch television for news and updates. It is also advisable to have an advisor or financial planer. If you have the capital, they will help you all throughout the investment process. Some banks and employers even provide their customers free financial arrangement as one of their assistance package.
Investing your money in different companies lessens the risk of losing the money in a blink. With a diversified strategy, you can withstand the bad times and enjoy the uptrend. There is no way but to be wise and updated about the stock market, fluctuations, and economic conditions.
Brock Hamilton
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Best Investment Strategies - Your Ultimate Guide
There are so many opportunities for investment around you, you merely have to take the initiative to find out what they are. Having the discernment and all the right tools to find the best investment strategies are important, as is securing vital and timely advice. You will need to assimilate the basic investing concepts that are the key to maximizing your profits. In fact, these concepts are culled from good business principles that many successful business entrepreneurs benefit from knowing by heart.
Firstly, get as much education as you can about investing. Reliable and reputable sources of information are important. It would also be a good idea to have a mentor in your education process. Taking courses on investing is likewise a sound idea as it will arm you with additional strategies and investment tools. Secondly, diversify any and all of your investments. Never put your eggs all in one basket.
Some of the best investment strategies involve keeping your eyes and ears open for any investment opportunities that come your way. Doing thorough research on these opportunities is very important. Later, as you become more investment savvy, you will know which opportunities are worth taking advantage of and which ones you shouldn't touch with a ten foot pole. There are many investment tools available that go hand in hand with the best investment strategies today. Some of these tools include marketing and advertising. Investing in companies whose advertising identifies what the company is all about and captures the bulk of their audience is a sound idea. Apt advertising that results in a terrific response just shows that the company's management has zeroed in on its targets and has identified what works. Investing your money in these companies will definitely give you a good return in investment.
Going for long-standing strategies in investment will help protect your capital from risks and losses. These enduring strategies involve investing in dividend-based stocks which run on compounded interest that piles up into huge profit later on. These kinds of investments decrease capital loss and generally lower investing risks. While they are more conventional than most investment options, you get a steady return of investment without overly risking your capital.
Another good investing strategy is to invest conservatively to help protect your capital. These kinds of investments safeguard your principal and while they do not make one automatically wealthy, they will still bring in substantial returns without the possibility of absolute loss. Cost averaging is another investment technique favored by savvy investors. Cost averaging will be the basis for your getting in or removing yourself from certain industries. This investment model is primarily mutual fund-based and relies on a debt oriented method.
As an investor, it will always be a good idea to remember that the world's financial markets work in a cyclical manner. This means well-informed decisions and multiplicity of investments is the only way to stay ahead in the investment game. These investing decisions must always be based on sound investment strategies that do without the "extreme" moves that most often end up in disaster.
Brock Hamilton
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Investment Guide
With so many business opportunities in the internet, ad sense, click bank, Amazon etc, one not only needs to know how to identify a genuine opportunity but also one which will give the best returns. Even the best business opportunity can miss returns if you do not know how to run it. The success of any business venture largely depends on how the business owner is able to identify customer needs and effectively satisfy them. This means that the business owner should religiously update him/herself with the current business trends. Thus the best way to remain in business when you realize that you are beginning to make losses is to carry out a market research for your products.
The detention of your business failures is far much effective through research than by just trying to identify them theoretically. One draw back of research however, is that it becomes hard to establish trends when the consumers have changing needs and therefore do not follow a specific pattern. Nevertheless, you better establish that consumer needs are changing for this will allow you to change the kind of products you trade in.
Much has been said about internet business. It is argued that it is not easy to identify which business pays. The truth is that most of such businesses are paying but the challenge is who to market such products. Marketing internet businesses take different forms. What you need to establish is which strategy work for you. Remember that marketing is essential in all business ventures.
Rubben Ochien
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How Much To Retire
Determining how much money you need to retire will require watchful analysis of your spending habits equally well equally a morsel of amount crunching. The generally main step you can take to determine how much money you will need to retire is taking the stretch to stretch up with a realistic estimate of how much you want consume both time into retirement.
Once upon a time you hold an estimate of your retirement expenses, you can purpose to help you with relax. Whether you purpose an online calculator otherwise you crunch the records by hand, at this time are the steps you will need to stab through to determine how much money you need to retire.
4 Steps To Determine How Much Money You Will Need To Retire:
Estimate Your Retirement Expenses
To determine how much money you will need to retire, you should originator estimate your retirement expenses; how much you think you will consume both time into retirement, plus an estimate of taxes you will recompense on retirement returns. At this time is a guidebook to help you through this process.
Figure Out How Much Retirement returns Will stretch From Guaranteed Sources
Lone of the steps you will need to take to determine how much money you will need to retire is to picture made known how much retirement returns you will hold from guaranteed sources. You will subsequently compare with the intention of to your estimated retirement expenses.
Calculate The Gap concerning How Much Money You Need To Retire And The Amount Provided By Guaranteed Sources
The third step used to determine how much money you will need to retire is calculating the gap concerning retirement expenses and guaranteed sources of retirement returns.
Factor In Inflation And Life hope into Your Retirement Analysis
Variables like your rate of return on funds, life hope, the affects of inflation, and your enthusiasm to consume principal will all hold a lofty effect on the amount of money you will need to retire. To checking account instead of these variables you will aspire to develop both a greatest and most terrible job scenario.
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Ways To Invest Money
Anybody lack to recognize better ways to invest money, it's the savings and investments there count, is an adage that has become more fitting in the modern world. In today's fast explosive world, investments hold turn a motto in the financial world. Once the requirement expenses are interpreted concern of, one has to decide which is the best way and place for them to invest their hard earned money.
One stooped make investments in a good and reasonable manner. Before deciding to invest money, one stooped set apart neck-deep daily and monthly expenditure. One stooped too set apart the requirement amount to pay for any bills at the end of the month. Just a share of the monthly income stooped go in investments. Just put, the quantity of stock trading put out for yearn or suddenly term investments should not affect your daily lifestyle or liquidity.
A safe, cut and dry method of save money is the bank. Banks bid you a set concern for the quantity of money you stick with them per month. The concern place can be anything occasionally 2 percent to 2. 5 percent. Trust accounts are known to be the safest and almost flexible, if not the better way to invest money.
Another character of investments there Banks bid are bonds. About individual institutions wish companies too offer bonds. Thither is small dispute 'tween bonds and certificate of deposits. A bind too payroll out about seven percent as interest for the period of four years. Shackled stooped be invested in just once there is no immediate need of the money for a set period of time.
Other more trust accounts, Banks too offer 'Certificate of Deposits'. Under tonight scheme, the Banks bid a set interest for the amount of money you deposit with them for a set amount of time. The timespan varies occasionally suit to case, but the universal couple is six months to two years.
The Banks bid six to 7 percentage compounded interest on your deposits. 'Certificate of Deposits' are a sentence esteemed and sentence well-tried way of investing money. It is too one of the safest ways of investment money. Sometimes Banks bid a upstairs percentage like eight to nine percent.
Such accounts, security of deposits and shackled are rule and good ways of investing money. Though the returns on such returns are less, Southey are favored More because depending on the bank or company you deal with, the returns are guaranteed and also depended upon.
Another way of investment money is the stock market. One can buy pillory in a party as an investment in the company. Pillory are shares in companies arbitrarily can be boughten by individuals or other companies. The stock marketplace has ever granted full-bodied returns of investments. For example, a individual can buy pillory in a party for $5 and the adjacent day, the cost of the shares could be as high as $8 per share. Tonight is a perfective case of 'making a kill at the share market'. The stock marketplace returns as often as ten to dozen percentage annually.
Though thither hold might-have-been many stock marketplace crashes throughout the world, the stock market has always come back with a vengeance. Therefore, in hindsight, the better way of departure hit money to the stock marketplace is by investing a small amount and keeping it in the market for a while.
However, one has to be real deliberate spell investment in the share market. Thither is no other establishment concerning finance there is as explosive as the stock market. While the supra case quotes a develop of $ 3 in a day, chances are that the share prices may fall to a minuscule $1.
Therefore, it is recommended there one stooped make a right study of the company one is ways to invest money in and also the share market before investing anything in the share market.
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What is the Best Way to Invest Money?
Most people have got this in common. They don't invest "much time." I would like to quote Robert Kiyosaki's Rich Dad. "Since most people don't invest much time, they lose their money."
Robert also talks about the 90/10 rule of money. He explains that 90 percent of investors invest their money, but they don't invest much time at all. So how do you find the "best way to invest money?" Check this out. The 10 percent that make 90 percent of the money have invested more time than they have money.
Highly successful and well knows entrepreneurs Donald Trump & Robert Kiyosaki both follow this method, and thereby ultimately use less of their own money and more of their own returns to gain even higher returns. So why do people in general think that investing is risky? Well, first of all most investors take financial advice from so called "financial experts" who have very little financial education or experience. Here is an interesting fact. Less that 20 percent of stockbrokers do not or have not invested in the products they recommend to their clients.
Another really important thing to remember is that most people run off of hot tips. And these come from poor people, not rich people. They believe that someone else has the answer, and knows the best way to invest money. The real problem in today's society is that there is no financial education being taught in our schools, and teachers don't really have any real world financial experience or training.
So what can you do to get past this wall of confusion among the majority? Well, it's simple really. Just choose your advice with more caution. Always remember that your mind is your most important gift, so value it and use it with caution and respect. You have to do this. Let go of the thoughts and ideas that are already in your mind, flush your mind of these things! Often it's harder to get rid of these old thought patterns that creating new ones. But there is a solution - in your mind!
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Understanding 403b Retirement Plans
A 403(b) Retirement Plan is a form retirement savings plan which is aimed at making the retirees and the older adults financially stable in their post retirement period. The 403 b retirement plan mostly caters to the teachers, self employed ministers and non-profit employers.
One major advantage of 403b plans have over other retirement plans is with the payments of the income taxes. In 403b, the funds are allowed to grow over a period of time. After the money withdraws, it is liable for taxation. In the present scenario, the 403 b plans also consist Roth contributions or after tax contributions. Many times, if the applicants comply with various other requirements then tax free withdrawals are also allowed. The Roth Contributions requires to be included in the 403 b plan for at least a period of five taxable years.
The terms and conditions associated with the 403b plan are more or less same as of 401 K plans. The plan is offered from the employer side, and one can immediately start enjoying the good financial benefits after retiring from the job
There are also other ways in addition to the conventional methods through which one can withdraw the employer contributions. You are allowed to withdraw the employer contributions before reaching the age of 59½. However, it requires that the plan is funded with annuities.
The 403b retirement plans are salary deferral contribution plans thus has universal applicability. This feature also allows employees to make various kinds of salary deferral contributions. Another benefit of 403b plans are that they are simple, having cost effective reporting requirements.
The 403b retirement plans are often referred as a tax-sheltered annuity plans. Various kinds of tax-exempt organizations such as health care institutions, universities, colleges, etc are covered under the plan. www.futureyears.com/retirement-plans
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Retirement Income Planning - Why You Should Consider It
The most important thing investors should consider today is the need to save for their retirement. It is becoming increasingly clear that many countries can barely afford National Superannuation.
If we take New Zealand as an example, the Government's decision in the recent budget to suspend contributions to the Super Fund is the issue that is getting the most media attention. One assumes that if the Government decided to instead borrow more and keep paying into the Super Fund it would have been criticised for doing that too.
On balance, their decision to freeze contributions looks sound. Borrowing to invest in a balanced portfolio, at a time when the Government's income is falling and debt is rising, and at a time when markets are far from guaranteed to deliver a return much in excess of the cost of these borrowings, would not seem to make much sense.
The bigger issue is, of course, that with our limited earnings base, New Zealand can barely afford national superannuation, and as the baby boomers start to retire this pressure will only intensify.
Whilst the baby boomers are likely to be able to get paid the pension, it is my generation - the 'flower power' babies - that may have to face the music. We will likely have to choose between higher taxes or a lower pension. The age of entitlement will be more like 75 years of age. The weekly allowance will also probably be much smaller than the 66% of the average wage that is paid today, and it will definitely be means tested - after all, social welfare is for the needy not the greedy.
What you need to remember is that while a smaller retirement pension for future generations is a certainty, it has nothing to do with politics, and everything to do with financial reality. For most New Zealanders the New Zealand Superannuation income will not be enough to sustain their current lifestyle in retirement. We need to trim our spending, pay off debt as quickly as possible and save more. The reality is that you need to start planning now for your retirement in order to supplement your income in the future. So I suggest that you go and have another look at those retirement planning brochures that are sitting at the bottom of your recycling bin.
Cam Watson is the Chief Investment Officer for ABN AMRO Craigs, which is one of New Zealand's largest independent investment firms.
He has over 18 years experience in the financial services industry. For eleven years Cam has been employed with ABN AMRO Craigs, becoming Chief Investment Officer in 2007.
Previously he has held Business Development, Investment Management, and Client Services roles at Tower, Southpac, Prudential and Tower Trust Services. This experience in a range of senior roles for major companies has given Cam a wealth of knowledge to draw upon and made him one of New Zealand's trusted investment experts. Cam holds a Bachelor of Arts Degree and a New Zealand Stock Exchange (NZX) Diploma. He has been a member of the NZX since 2001 and has a current Sharebroker Licence. As with all ABN Amro Craigs Investment Advisors, Cam is required to maintain continuous internal performance modules, covering topics such as industry and regulatory developments. He also has the support and resources of ABN AMRO Craigs global research network. abnamrocraigs.com.
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How Much Do You Need to Retire Abroad?
Retiring abroad is one of the most exiting ways to spend your retirement life. While enjoying an international retirement you get to start a new life in a new local and rediscover the world from a fresh perspective. Many people find it a bit difficult to accept their retirements though. This is true, especially in case of those who had been rather attached with their profession or career. Such people often plan to leave the country for a greater impact that would easily help them in coping with the fact that they no longer have a working life. Just like any other retirement plan, retiring abroad primarily depends on the size of your budget, that is, your savings and investments during retirement. Before making any kind of move you should have a rough idea about how much you need to retire abroad comfortably.
Your company pensions and social security benefits might not be enough for planning a cross-border settlement. You should have a strong financial base in order to implement such a life-size retirement plan. The size of your savings is an important determinant when it comes to settling in any foreign country. However, a more clear answer to the question of how much you need to retire abroad can be provided only when you decide your location. There are no standard rates to decide just how much you need to retire abroad. Nevertheless, you can take it for granted that it is surely going to cost you more than what you are living on right now, in your own country.
Primarily, the standard of living in the country to which you are moving defines your basic budget requisites. The only way to cut down your cost is to choose a place where cost of living is lower, but such countries might not be able to provide you with high quality standard of living to which you are accustomed till now. If you are someone who loves the countryside atmosphere then you can opt for living in less urbanized places. This will be quieter and cheaper. There are several European countries which attract lot of retirees who come there and settle down for the rest of their life.
While calculating the budget for migrating to your new destination you should take into consideration the investment and saving rules applicable in that country. It is important to educate yourself regarding the laws and practices of your new country because most probably you will be living in there for the rest of your life. There might be variations in these rules for non-resident Americans. You should also consider the maximum senior citizen benefits applicable to you. All the countries might not provide efficient medical care for senior citizens as in US. Such factors might considerably increase your cost of living in a foreign country.
Real estate prices are another inevitable factor which you must consider in detail while planning your retirement budget. The distance from your own country to this new place is also an important factor which determines your total cost. No matter how far you go, your roots will beckon you back to your motherland sooner or later. If you intend to visit your friends and relatives often in a year then your decision to live abroad can be an expensive one. Once you figure out how much you need to retire you can begin planning for how you can achieve that goal and make the Autumn of your life even more exciting than the Spring!
At Invest-Retire-Abroad.com we help you...
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Cheap Places to Retire Overseas
In the quest to find a cheap place to retire overseas one might come across various reports stating that so and so country is one of the best places to retire. It might be the best place to retire for that particular writer, but will it be good for you? The vast majority of us would like to live a simple, healthy, happy, and comfortable life especially after retirement. Let's look at some basic criteria to consider when looking for cheap places to retire overseas. We are not recommending regions, but based on the tips stated in here, you will be able to come up with intelligent decisions.
Many people retire due to the age factor, while some of them even take an early retirement voluntarily... wouldn't that be nice!! With the progress of time, one's age becomes a major consideration and determining factor for where you can move and retire to. The climate of the retirement destination city plays an important role while deciding the cheap places to retire overseas. It will be disheartening to go to some unknown country and spend the rest of the days on medicines. It's good to choose a region that has a good climate with sunny days and moderate rainfall all throughout the year.
One of the primary reasons why people look for cheap places to retire overseas is to reduce their current cost of living. $500 might be insufficient to exist in the United States, but it is more than ample to live lavishly in Panama. Please note that the previous comparison was just an example. There are many places available in this segment where you will be able to live comfortably without breaking the bank. Entering and exiting the country must be fast. In other words, the rules of entry must be lenient and retiree friendly. Retirement is a peaceful part of one's life. One does not like to spend his retirement days walking through the embassy halls every day and fighting with government officials trying to get their papers and visas in order.
The next in the list are the facilities that have been made available in the medical industry in the country where you are planning to spend the rest of your days. There is no use staying in a country where you will be charged $5000 for doing a complete checkup. Always keep this in mind while choosing the cheap places to retire overseas. At first, it might seem impossible to find a place with low cost but efficient medical facilities, but once you dig a little deeper, plenty of options will materialize in front of you.
The place chosen must be safe and must have a relatively low crime rate. Do not opt for a place, where there is a high chance of you being mugged every time you step into the dark shadows of the alley. Who wants that? It is true that criminals can be found in every part of the globe so be realistic in what you look for. However, it is also true that criminals are lower in number in some parts than others. While looking for a suitable retirement abode it is always encouraged to look out for a place where there are expatriates from your native country. Chances are high that you might meet some of them, spend some quality time with them, develop long lasting friendships and learn firsthand what life is like as an expat living abroad. Your retirement is an adventure waiting to happen, first studying up on some of these basic factors will prevent it from becoming a "mis" adventure!
Visit us at Invest-Retire-Abroad.com
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Investing On Internet
The World Wide Web has opened many doors for individuals of all ages and economic backgrounds to invest soundly and make their money work for them. There are many investment websites on the World Wide Web that make the rather confusing and intimidating stock market simple for you. They help you invest your money in everything from money market funds to stocks to bond without much fuss and worry.
When it comes to investing your money online, the key is to find a suitable investment firm that fits your needs and expectations. As with anything available on the World Wide Web, there are endless options when it comes to investment firms that are more than happy to take your money off your hands. Remember, before you invest a single cent, you should feel happy and confident with your choice of investment firm. If you feel uncomfortable of a company or their claims, further investigate their history before committing any funds.
Depending on your needs, you will find a different company to suit your every wish. If you plan on buying and selling stocks, mutual funds, or bonds on a regular basis, look to find a company that will allow you unlimited trades for a few dollars each month. However, if you would rather have a “wait and see” basis when it comes to investing, be sure to find a company that will not penalize you for not meeting the minimum of your monthly transactions.
After you have decided upon the investment firm that best suits your needs, begin looking into investments that fit your expectations. There are a variety of optional mutual funds, bonds, and stocks available to suit individuals wanting a minimal risk or those wanting to risk it all on the promise of high returns.
Consider joining an investment website or group that will allow you to speak with other investors about their investments. Often, investment groups are a great way for you to answer all your questions and take a look at unique investment opportunities you may not have noticed before. Also, consider joining websites that produce monthly or weekly newsletters that will allow you to have access to up to date information regarding investments of all types.
The money that you are investing online is what you have earned after a lot of toil. Always remember this fact. Investors tend to forget this while investing online because of the transfer taking place in cyberspace. Overlooking this fact and over investing may put you in debt.
Another helpful tip for online investing is to involve the entire family with the investment process. This can help you take the right decisions and also educate the next generation about the importance of saving money.
However you choose to invest online, do so today! Online investment is a great way to begin the saving process, whether it is a long term goal like education funds or retirement, or a short term goal like a vacation fund.
Provided by ArticleGOLD
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Retirement Planning and Your Finances
Credit Cards: Having a credit card is often a necessity for most senior citizens – from paying for medicine and emergencies to booking a vacation. But for seniors living on a fixed income, there are concerns about carrying a large balance from month to month and running up significant interest charges. In the worst cases, the debt becomes unmanageable and a major source of stress for the account holder and the family.
Another problem for seniors is having too many credit cards. That's because the more cards you have, the more opportunities you have to get into debt. And that possibility could make it tougher for you to get the best deal the next time you apply for a loan, insurance, a mortgage or an apartment. Having a lot of cards also can make it harder to keep track of when your monthly payments are due or to even realize that a thief may have stolen one of your cards.
Home Equity Loans and Lines of Credit: These are loans that use the equity in your house as collateral and often are tax deductible (check with your tax advisor). The equity refers to the difference between what you owe on a house and its current market value.
A home equity loan is a one-time loan for a lump sum, typically at a fixed interest rate. A home equity line of credit works like a credit card in that you can borrow as much as you want up to a pre-set credit limit. The interest rate for a line of credit usually is variable, meaning it could increase or decrease in the future.
"For elderly people on a fixed income who have paid their mortgage in full or whose mortgage is almost paid in full, home equity loans are tempting to use to pay for expenses, but they can also be dangerous," warned Janet Kincaid, FDIC Senior Consumer Affairs Officer. "In the worst-case scenario, if you are unable to make the required loan payments, you could lose your home."
In general, the best uses for home equity-type loans are to purchase goods or services with long-term benefits, such as home improvements that add to the value of your property. The riskiest uses of home equity loans include a vacation or a car because you could end up paying a lot in interest charges for a purchase that's only of short-term value or has gone down in value. Also beware that some unscrupulous people or companies (including home repair contractors) push high-cost, high-risk home equity loans to elderly people and other consumers.
Reverse Mortgages: These are home equity loans available to homeowners age 62 or older. In general, a reverse mortgage is a loan that provides money that can be used for any purpose, and the principal and interest payments typically become due when you move, sell your house or die. A reverse mortgage also differs from other home loans in that you don't need an income to qualify and you don't have to make monthly repayments.
While reverse mortgages can be a valuable source of funds, they also have serious potential drawbacks. In particular, you will be reducing your equity, perhaps substantially, after you add in the interest costs.
"Reverse mortgages can help in some situations, such as when you have large medical bills that are not covered, to make major home repairs or to help people on low fixed-incomes make ends meet," said Cynthia Angell, a Senior Financial Economist at the FDIC. "However, you are reducing your ownership share of the home. That means the inheritance you are leaving to your heirs could be greatly diminished or you could have far less money available for other purposes, such as buying into a retirement community later on. That's why a reverse mortgage should usually be used as a last resort, not as an integral part of a retirement strategy."
Also, Angell said, the fees can be high, and that could make a reverse mortgage a poor choice to cover relatively small expenses.
Life Insurance: People mostly think about life insurance as a source of income when someone dies, but they forget that many insurance policies also can be a source of cash at other times.
If you have a life insurance policy with built-up cash value, you can borrow against that money and either repay the loan with interest or reduce the death benefit accordingly. Example: If you have a $100,000 life insurance policy but you owe $20,000 on a loan from that policy, your heirs would receive $80,000 as the insurance payout.
There are other options reserved for people who have been diagnosed with a terminal illness and have run out of other ways to pay their expenses. One example is a life insurance policy that can pay "accelerated death benefits" to an eligible policy holder — generally up to about 50 percent of the face value of the policy — in either a lump-sum payment or monthly payments that are deducted from the policy's face value. When the policy holder dies, the rest of the death benefit is paid out.
Another possibility is to "sell" your life insurance policy to obtain a lump-sum of about 40 to 80 percent of the face value in exchange for the right to receive the full insurance payout when you die. This is known in the insurance business as a "viatical settlement."
These and other options for tapping life insurance policies can be complicated (including tax and other implications), and they are not right for everyone. Consider getting guidance from your state government's insurance regulator.
Provided by ArticleGOLD
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Opening Children Savings Accounts To Secure Your Childrens Future
Opening a childrens savings account instead of buying bonds when planning for your childrens' financial future is a savvy choice. From the time we first become parents, of course we want the best for our children. We do everything we can take care of them responsibly. We feed, clothe and love them, and hope that they'll grow up to be everything they can be, with full and active lives. However, if something should happen to us as parents, what would happen to our children? Life insurance is one way to help our children make sure they have what they need if the guardians we choose for them do not have the financial means to provide the life we want for them. Savings accounts offer a viable strategy regardless of your financial status.
When you start to invest in your childrenss future this way, you do a number of beneficial things. First of all, you can begin to save money in your childrens's names when they're young by making regular deposits. They can also contribute funds to their own accounts, in the process learning how important and rewarding saving can be. This can help offset the cost of tuition for college as educational costs in the country skyrocket or for any other educational programs they might need in the future. However, unlike many college savings programs, funds in a childrens savings account do not have to be spent solely for education in the event, god forbid, they choose not to go to college. Money is available should there be an emergency, or for any other situation, without penalty for withdrawal. The money deposited in a childrens savings account is available to the childrens immediately.
A number of financial institutions offer special childrens savings accounts, so finding a competitive rate may only require a little research. Many banks have a childrens savings account that offers no minimum age, but they may include the stipulation that an adult be in charge of the money until the childrens reaches a certain age.
Another option is to open a 529 college savings account in your childrens name, these offer more than just a federal tax break for the capital gains tax. Most states also allow tax benefits for either a college savings account or a prepaid tuition plan, although some states may have a limit on how much of an investment will receive a tax break. Withdrawals made from a college savings account or prepaid tuition plan not spent on qualified purchased may be taxed and penalized through the Internal Revenue Service. These penalties may not apply, however, under special circumstances such as receiving a scholarship, acquiring a disability or death.
Purchasing bonds is not presently is not a good option to help secure your childs financial future. Because bonds hold the initial monetary investment for a set amount of time before they mature, they now have a lower fixed interest rate than the more flexible childrens savings account. So don’t sock away your money into these bonds unless you’re in willing to accept a lower return on your investment. For the long haul – bonds usually have a minimum of three years (and in most cases, much longer) before they actually mature.
Regardless of whether you decide on savings, purchasing bonds or both, you'll create a financial cushion for your kids future when they may need it most. This also gives you the peace of mind to know that your children will be taken care of long past your initial investments in them financially. With a little research for choosing the best one and regular deposits into a childrens savings account your childs financial future will be bright.
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Retirement Investment Strategies - Three Things You Must Do to Achieve Investment Success
How is your IRA doing? If yours has been performing like most people's, your savings have been virtually decimated in the last few years. That's very unfortunate, and it happened because so many people don't know what they need to do to keep their savings safe even during bear markets, and to keep them growing consistently most of the time. Read on for some retirement investment strategies that will improve your money's performance in the future.
But first, let's ask a question: Why don't people know more about proper retirement investment strategies? Well... IRA accounts are the responsibility of their owners, and the advice they get -- sometimes even generously provided by family, friends and news sources, is rarely sufficient to help them make the most of their retirement savings.
So it's up to you to watch out for your own money. Here are three things you can do to achieve investment success. In fact, you must do them if you want to hang on to your money and actually make it grow.
1) Get help
You need knowledgeable guidance. You risk losing big-time if you don't have access to an experienced advisor. Of course, you could also study up yourself, and doing some of that is definitely a good idea. But it's difficult to build up enough knowledge in a reasonable amount of time to become a truly good steward of your IRA account. So why not call in an expert. He or she will help you grow your money much more consistently and more safely than you could ever do it on your own.
2) Get a plan
You also need to have a plan. What are your expectations, what is your level of tolerance for risk, and how much time do you have to accumulate your retirement savings? Given these and other parameters, you should set up a plan and stick with it. Of course, it should be reviewed on a regular basis to make sure it still suits you and is appropriate for the relevant market conditions.
But what if your plan is wrong? Well, that's why we have point 1: Get Help. You should create your plan with the help of a knowledgeable advisor who has plenty of experience with retirement investment strategies. And, by the way, make sure that any advisors you consult are working for you and not for commissions. How to tell? If they are fee only advisors, you can be pretty sure they will give you unbiased advice. If they say there's no charge, which means that they'll get paid by the funds they recommend, run for the door.
3) Stick with the plan
Stick with your plan, unless and until you and your advisor decide otherwise. It's important not to be guided by impulse and emotions. Most of the time, that will only get you into hot water. Many people who try to time the market and sell when the stock is sinking or buy while it's rising end up losing out. They end up buying high and selling low, which is the opposite of what you should really do. But if you have a good plan, you probably have a contingency plan as part of it as well, which will tell you what to do in certain market situations.
From FeeOnlyFinancial.net
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Advisers, investors call for reinstating uptick rule
Highlighting investor concern about the market effects of short selling, more than 3,000 comments have been filed with the Securities and Exchange Commission on proposed changes to the short-sale rule.
A majority of the comments appear to be from individual investors who want the SEC to restore the uptick rule. That rule was rescinded in 2007 when the SEC put new short-selling rules in place.
One of the proposals issued by the SEC in April would restore the uptick rule, requiring that short sales be allowed only at a price above the price of the last transaction. The rule is intended to prevent short-sellers from putting severe downward pressure on stock prices.
There is no timetable for acting on the proposal.
The comment period for the SEC's short-sale proposal ended June 19. Although the commission received more comments than usual, the volume doesn't compare with the more than 20,000 comments filed on proposals involving executive compensation and other topics, SEC spokesman John Nester wrote in an e-mail.
The SEC proposal asked for comments on whether the uptick rule should be reinstated, whether some form of “circuit breaker” should be put in place that would limit short selling in markets that are declining rapidly or whether some combination of those techniques should be employed.
Some financial advisers joined in the chorus of individuals calling for reinstatement of the uptick rule.
One of those who commented was Gloria Franz, a certified financial planner and president of Franz Wealth Management Inc. of Palm Desert, Calif., which manages $50 million.
“The rule should be intact,” she said.
“You could prevent people from being able to crush the price of a stock by having so many short sales,” Ms. Franz said. “They're allowing way too much manipulation of the market.”
Another CFP who wrote a letter in favor of reinstating the rule was Kathy Ellis, a financial adviser in the Clarksville, Tenn., office of Raymond James Financial Services Inc. of St. Petersburg, Fla.
“The uptick rule should be reinstated permanently, and naked short selling should be eliminated,” she wrote in her June 16 comment letter. Abandoning the uptick rule “did more damage to investor confidence and net worth than just about anything else. In the midst of the crisis we faced last fall, there was manipulation of the markets and damage to some great companies,” Ms. Ellis wrote.
Not all advisers agree that the uptick rule should be brought back, however.
MORE EVALUATION
Noting that the SEC is taking action relatively soon after it issued its last rules involving short selling, Geoffrey Foisie, an investment manager at Shawbrook, a registered investment advisory firm in Alexandria, Va., that manages $5 million, said that more time is needed to evaluate the last rules issued.
He is chairman of the Industry Relations Committee of the National Association of Active Investment Managers, a Denver group representing about 130 members, who manage about $10 billion. Advisers in that group use short-selling techniques and funds that apply those techniques to try to reduce risk for clients.
The SEC proposal is so broad, it would impose barriers to short selling, Mr. Foisie said. “It threatens a lot of very standard risk-reduction techniques that many advisers use on behalf of individual clients around the country,” he said.
Groups that represent the mainstream brokerage industry and the hedge fund industry, which employs short-selling techniques, argued that the SEC proposal isn't necessary. But they also hedged their bets by recommending modified versions of the proposal if the agency does move forward.
“We don't think there is a need for these additional proposals,” said Stuart Kaswell, executive vice president, managing director and general counsel of the Managed Funds Association in Washington, which represents hedge funds.
The short-sale rules previously put in place by the SEC “have gone a long way to addressing concerns about improper naked short sales,” he said. Rather than instituting new rules, the SEC should vigorously enforce the rules already in place against illegal short selling, Mr. Kaswell said.
“We shouldn't confuse short selling with market manipulation,” he said. “Short selling is a perfectly legitimate practice” that helps with hedging and price discovery, Mr. Kaswell said.
However, if the SEC decides to go further with short-selling restrictions, the MFA thinks that some combination of a modified uptick rule and circuit breaker “would be less problematic than others,” he said.
The Securities Industry and Financial Markets Association of New York and Washington said in its comment letter that the brokerage industry doesn't think that reinstating the uptick rule is necessary. However, if the rule is reinstated, it should be narrowly tailored toward certain stocks that have tripped a circuit breakers, SIFMA said in its comment letter, which was signed by Ira Hammerman, the group's general counsel.
DIFFERENT POSITION
In an unusual twist, NYSE Euronext of New York took a position differing from that of the brokerage industry. The company, which operates the New York Stock Exchange, said in its comment letter that the SEC should adopt the uptick rule. Doing so “could have a real impact on investors' and issuers' confidence in the equities market,” wrote Janet Kissane, its legal and corporate secretary.
But Patrick Byrne, chairman and chief executive of Overstock.com Inc., a Salt Lake City company that was on the SEC's list for failure to deliver shorted stock from 2005 to 2007, said that the agency needs to adopt a requirement that shares actually be delivered before they can be shorted. Traders can find loopholes to get around the uptick rule, he said.
Adopting the uptick rule is “giving chicken soup to a cancer patient,” Mr. Byrne said. “It's not going to help.”
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