Friday, February 27, 2009

Ways to Improve Your Credit Score

By YiLin Zhu
Feb. 27 2009

People always want to improve their credit score, not only because a good credit score will help them have a cheaper interest rate when they borrowing money, but also because a good credit score will help their lives much easier. But if you forget to pay several bills on time or did something hurt your credit, what you can do to repair the damage? The following is some tips for improve your credit score.

1. Always pay your bills on time, but if you missed the deadline, get current and stay current.

2. If you have problem making the ends meet, you should get in touch with your creditors to help you with managing your credit and pay bills on time.

3. Pay off debt rather than moving it around.

4. Don’t close unused credit cards as short-term strategy to raise your score.

5. Don’t open numbers of new credit cards that you don’t need just for increase your available credit, apply for and open new credit card only as needs.

6. Don’t close paid-off, old accounts.

7. Keep balances low on credit cards.

8. Re-establish your credit history if you have had problems.

10 Tax Terms You Need to Know

Post by YiLin Zhu on Feb.27 2009
By Mary Beth Franklin

Does preparing your income-tax return remind you of taking a final exam in a foreign language that you don't understand? We can help. Think of Kiplinger as your Berlitz guide to taxes. We've translated key words so that you can understand not only what they mean but also how they can help you lower your tax bill.

Start with adjusted gross income. AGI includes your total income from all taxable sources (such as wages, interest, dividends, and self-employment and rental income) minus certain adjustments (see below). AGI is the key to determining your eligibility for certain tax benefits -- or, if it is too high, your exclusion from them.

Some of those adjustments to income, also known as above-the-line deductions, include deductible contributions to IRAs and Health Savings Accounts, student loan interest, travel expenses for military reservists, job-related moving expenses, and out-of-pocket expenses for teachers who purchase classroom supplies. You can claim these tax breaks whether or not you itemize your deductions (see below) and use them to reduce your AGI.
You can also deduct a personal exemption, worth $3,500 apiece in 2008, for yourself, your spouse and each of your dependents. So a family of four could deduct $14,000 in personal exemptions from their taxable income on their 2008 tax return.. (The value of exemptions is partially phased out at higher income levels.)

Wednesday, February 25, 2009

Steps to Debt Relief

By Dan Hughes

It is very easy these days to get yourself into debt, and a lot of it. With the amount of credit cards, loans, and other types of debt increasing instruments, it could, in fact, be quite difficult to not get caught in debt's web. Many people today have a lot of debt and are unsure of how to get out of it. Here are some steps that, if you stick to them, can help you on your way of getting rid of your debt:

Step 1: Review and understand where your budget went wrong and where excess spending exists.

Step 2: Prepare a living budget in your Money Management Plan.

Step 3: Confront issues of why you overspent. If you need help, counseling can be a great way to get to the root of your overspending problems.

Step 4: Use recommended guidelines to get your budget back on track. If one section exceeds recommended percentage, begin by cutting back there or modifying the percentage to fit your budget.

Step 5: Begin to pay extra on high-interest bearing accounts, such as credit cards, one at a time.

Step 6: If you get a tax refund, bonus, or other intermittent income, use this for immediate debt relief.

Step 7: Update your budget regularly to keep track of all income and expenses.

Step 8: Stop using credit cards.

Step 9: Come up with ways to increase income, such as a second job, selling unused items, etc., and find ways to reduce spending.

Step 10: Find ways to see if you can obtain any savings on payment of your debts.

Step 11: Take advantage of online resources to save money on your spending including groceries, utilities, shopping, travel, and more.

Step 12: Close your department store charge accounts as you pay off those debts.

Step 13: Continue to learn about sound money management practices.

Always remember that, no matter if you are in the process of relieving your debt or out of debt, do not try to keep up with the Jones's and always spend less, pay cash, ignore credit card offers, pay off credit cards, buy on sale, and be realistic. 

Tips for Personal Finance

Posted By Ken Smith

After looking at many articles on how to improve your personal finance situation there seems to be a trend of certain tips that every article has.


1.     Create a Budget – The importance of creating a budget is key to personal finance success.   Without a Budget you are unable to allocate your earnings to the right expenses or see where your funds are coming from.  With a budget you can see where you are spending more than necessary and then reduce the spending or ad spending on where you may find it necessary.

2.     Have a Savings Plan or emergency  - when you have a simple savings system and emergency savings plan you are always prepared to handle any thing that may happen unexpectedly. 

3.     Keep Sufficient records and use budgeting software – To keep sufficient records will help you know where you have spent your money and by using software and computers you will have easy access to all of your past history.

4.     Always Plan for Retirement – when looking at your personal finances you need to account for your retirement.  The safest bets are continually investing in your 401k and continually growing that fund for your retirement. 

Source #1, Source #2, Source #3

6 Ways To Maximize Your 401(k)

Copy and Post by Mei Ling Lin

As with so many things in life, the responsibility for maximizing the potential benefits of your 401(k) plan falls largely on your shoulders. In this article, we'll give you six tips to make a healthy and growing 401(k) a reality.
1) Participate
If your employer offers a 401(k) plan, you should participate in the plan. The math is simple: if you don't put anything into it, you won't get anything out of it. Once you've made up your mind to get started, don't procrastinate. When it comes to 401(k) plans, time is your friend. The sooner you start contributing to the plan, the longer the span of time your money has to grow. If you delay participating, time works against you. To make up for lost time, your contribution rate will need to be higher and/or your rate of return greater to achieve the same retirement nest egg that could have been built with fewer dollars and lower rates of return had you started earlier.
2) Take the Company Match
One of the first questions that most 401(k) plan participants ask themselves is, "What percentage of my salary should I contribute?" This is an easy question to answer. Invest as much as you can afford, but no less than the amount required, to receive the full company match. The company match is free money. Think of it as an instant return on your investment, and don't let even one penny go to waste.
3) Plan
Proper asset allocation is responsible for the majority of investment returns. It is a time-tested principle that offers a valuable lesson for investors. So, learn from this lesson and plan your portfolio accordingly. If you start investing when you are young, take an aggressive approach and choose stocks over bonds. While it is true that stocks present a greater risk of loss than bonds, the potential rewards are also greater.
Once your portfolio is in place, monitor its performance. Keep in mind that various sectors of the stock market do not always move in lockstep. For example, if your portfolio contains both large-cap and small-cap stocks, it is very likely that the small-cap portion of the portfolio will grow more quickly than the large-cap portion. If this occurs, it may be time to rebalance your portfolio by selling some of your small-cap holdings and reinvesting the proceeds in large-cap stocks.

Ways to Pay for College

By Mei Ling Lin
The tough economy, give everyone a hard time, including current high school seniors and their parents. It’s hard to figuring out which college they or their child should attend and also how to pay for college, compare to the high school seniors in the past few years. Recently, some students don’t have ability to pay for expensive tuition, so that choose to go to community college, even they accepted by top schools. In addition, some current college students also have stresses to pay for the college base on their family income change in the downturn economic.
There are some hints can help you or your child to pay for college:
1. FAFSA (stands for Free Application for Federal Student Aid), need to fill out and submit it as soon as possible after Jan1.of the year. You can go to the web site to fill out the online application form.
2. Federal Work Study Program and Stafford Loan, when filing the FAFSA application form, must select the Federal Work Study Program and Stafford Loan option. It provides an opportunity to work on campus to earn extra money and the Stafford Loan lend you money to pay for college with low interest rate.
3. Military Tuition Assistance Programs, the United States military can help you to get money for college.
4. Free scholarship and grant search, go to college web site to find the opportunities to apply school scholarship or outside scholarship
5. Participate in competitions such as writing to earn your free tuition
6. Get a part-time or summer job to earn money to pay for college
7. Parent Plus Loan, a Federal Parent Plus Loan, can help to pay college expenses with low interest rate
8. Uncle Sam, private loan

Setting Financial Goals

By Dan Hughes

Monday, February 23, 2009

Saturday, February 21, 2009

Friday, February 20, 2009

Some things that our bank and banker won't tell us

By YiLin Zhu on Feb. 20 2009

People work hard to make money, and then put the money in the bank either to save it for later use and making interest or just for security. However, some times when we walk into the banks and were recommended to some new products and services that the bank offers, and by the end of the month, we may receive a list of unknown fees shows on our balance sheet. But we have no idea how did this happen? Or is there anything we need to know about our banks and our bankers.

First of all, banks will never tell us that their tellers and other bank employees will get a “referral fee” for steering us toward their investment products. Secondly, fees are a big business for banks, and punitive fees such as no sufficient funds fees rake in the big bucks. So as long as there is no fraud involved, the banks don’t mind when customers bounce their checks. When banks are going to merge with another bank in a month, they also won’t notify their customers that they might mess up our accounts. Most commonly, even though all the banks tell us they respect our privacy, but the banks are still willing to sell our personal information to other agencies for a profit. So when we’re giving out our information or accepting the services provide by the banks we do need to be more careful.

Source #1; Source #2; Source #3;

Three ways to deal with a smaller nest egg

Post by YiLin Zhu on Jan. 20 2009

Article By Robert Powell

BOSTON (MarketWatch) -- It's not as if we need another survey to tell us what we already know. Given what's happened to our retirement accounts and home equity, none of us feel as wealthy as we did a year ago -- and that feeling is only backed up by the latest Survey of Consumer Finances.

But economists who pored over the SCF data said the typical American family is much worse off today than it was in 2004, if not before that. The typical (as in median) American family watched its net worth fall to $56,700 this year from $87,300 in 2007, according to the economists who pen the Baseline Scenario, an economics Web site. In 2004, it was $86,000.

According to estimates by the Baseline Scenario, the typical American family had assets in early 2009 of $160,600, including $125,400 in home equity (down from $150,000 in 2007), $17,900 in retirement accounts (down from $23,900 in 2007) and the rest in bank accounts and other physical assets. That same family in 2009 had liabilities of $103,900, including a $88,700 mortgage on a primary residence (the same as in 2007), $12,800 in installment loans (the same as in 2007), and $2,400 in credit card debt (the same as in 2007).

All those changes in net worth, mostly in assets rather than debt, happened at a time when household income remained about $47,000 from 2004 through 2009. "This current crisis has significantly reduced the assets that many households were counting on for retirement," said James Kwak, co-author of The Baseline Scenario. "If there is a silver lining in there somewhere, perhaps it is that people will focus more carefully on the amount of money that they need to save for retirement, and on ways to ensure that that money is there when they do retire."

So what should the average pre-retiree or retiree do, given what's happened to their net worth?

Monday, February 16, 2009

Personal Finance: 20 Dos & Don'ts for 2009

Post by Mei Ling Lin

During the worst economic crisis in a lifetime, the right financial decisions are crucial.
BusinessWeek asked financial planners for some advice on what to do—or not to do—with your money in the New Year. As we bid farewell to a dreadful 2008, these "resolutions" may help keep your finances on the right track in 2009:

1. Don't try to predict the future.
"We are currently in the midst of unprecedented and complex challenges," says Femi Shote of Asset Harvest Group in McLean, Va. Anyone who thinks he or she can predict what's going to happen is "delusional," Shote says.
Financial advisers often hear from clients who would like to sell stocks now and then buy again when the market hits bottom. "My response is, 'How do you know when that will be?'" says Trent Porter of Priority Financial Planning in Fort Collins, Colo.

2. Do keep enough cash available.
Even if you're not worried about losing your job, a rainy-day fund can provide peace of mind.
There are different guidelines for how much cash to keep on hand. Some say $12,000 or more per adult; others say it should be six to nine months of living expenses. With extra cash available, you can avoid selling investments to pay for expenses in an emergency.

3. Do invest internationally.
Though the financial crisis started in the U.S., the past year has been worse for investments in the rest of the world. The MSCI EAFE, an index of international stocks, is down 43% this year, and stocks in emerging economies fared far worse. American investors who diversified abroad have also been pummeled by the rise in the U.S. dollar.
Even after a year like that, advisers say it's not wise to abandon international investments entirely. For one thing, though some key overseas economies, like China's, have been hit hard lately, their long-term economic fundamentals look better than those of the U.S.

What is a Personal Finance Budget?

What Is a Personal Finance Budget? -- powered by

Posted By: Ken Smith

Friday, February 13, 2009

How to invest your money in 2009

By YiLin Zhu
Feb. 13 2009

The financial crisis started at the end of 2007 seems still continuing after the New Year. All the investors won’t forget what a terrible year it had been for them in 2008. During 2008, many successful investors was no longer looking for high return rate, instead they just expected not to lose. However, the year of 2009 will be no picnic for the investors either. So how to invest money in 2009 becomes a hot issue these days. The following is few tips for you to invest your money safely and smartly.

1. Real Estate
According to, there are over two million foreclosure properties listed in U.S. right now. Although it’s not a good news for America’s economy in general, but it indeed brings a great opportunity for the real estate investors. The prices are low, the number of distressed properties keep increasing and the home loan funding still have a historically low rate.

2. Gold
It is a difficult time for America, because of most of the assets are under performing. But gold has still able to remain its value. Gold is one of the safest objects that can prevent investors’ assets from the currency depreciation and real estate undervalue. Owning gold is good for hedging investors’ portfolio of stocks and properties as well.

Source #1; Source #2; Source #3.

5 Tax To-Do's in February

Post by YiLin Zhu

Written by Eva Rosenberg, February 12, 2009

Time to leg down figures for stock basis, work expenses, child-care credit.

1. Investment 1099s are coming: But wait! Don't file your return yet. You still don't have the correct 1099-Bs for your investments. Your brokerage or investment house was given additional time to send them out you. Their mailing deadline is February 17. Have you been stung in the past by having filed your tax return based on the first set of 1099s you received, only to get the corrected set later? This should eliminate the need to wait for the corrections.

2. Research basis: With the collapse of Wall Street, your brokerage may have changed hands, or you may have lost confidence and moved your account somewhere else. You didn't actually have to sell your securities to move them to a new brokerage. So what's the problem?
Your new broker doesn't have the purchase information of the original stocks. Do you have it? Can you still get into your old account online to get the information? You're going to need the basis on all the securities that were transferred.

Naturally, for your 2008 tax return, you only need the basis for the securities you sold in 2008. But while you're getting that information, you may as well get the basis for everything that was transferred and enter it into your new account.Check with your brokerage, or accounting software. You may already have access to it for free.
Remember, the basis won't necessarily be the cost of the security. It may have split, or reverse split. You may have reinvested dividends. Did you keep track of those costs for the additional shares?

Take the time to do the research. Then, next year when you get your 1099-B, it will show the correct basis of the securities you sold. If you can't readily find the basis you need, perhaps Wolters Kluwer's GainsKeeper tool can help. Richard Preece, group product manager at TurboTax in San Diego waxed eloquent about being able to enter a stock name or ticker and the purchase date -- and voila, you get the correct basis per share, net of all splits, reorganizations, etc. GainsKeeper is included in TurboTax's Premier product.
3. Hidden expenses: Scour your final pay stubs for useful information. Remember to include all the jobs and retirement income you had last year. In the course of preparing for an audit last month, TaxMama was appalled at what she found on a client's pay stub. There were deductions for dental insurance, and for his and her health insurance. Total? Over $20,000 in medical expenses that had not been included on the tax return.

Remember to look for union dues, payments for tools, equipment or other supplies. You may be able to use them as employee business expenses.If you're working with a tax professional, remember to let him or her know about these expenses that don't appear in your checkbook and credit card statements.

4. Reimbursed expenses at work: Are you paying taxes on your reimbursements? Reimbursed expenses have become contentious in the last couple of years. Employees are finding some reimbursements added to taxable wages - with all the Social Security and Medicare deductions applied.

Typically, your company should only be adding taxable reimbursements to your wages when they give you money without insisting that you account for the use of it. In other words, you get a $350 per month expense account to use as you see fit. You don't have to turn in receipts to your employer. IRS considers this to be disguised wages.

When your company adds your reimbursements to your income, be sure to deduct them from your tax return. Use Form 2106 - Employee Business Expenses. See the form on the IRS site.
Don't enter the reimbursements you've received on line 7, since you've already paid tax on those reimbursements.
Use the Form 2106 instructions for guidance.

Incidentally, you wouldn't need to go through this extra work if your company had an accountable reimbursement plan. When all your reimbursements are on the basis of expense reports you submit to your company, you don't get taxed on the reimbursements. The numbers never appear in wages, W-2s, or your tax return. Perhaps you can convince your employer to implement an accountable plan? See this IRS page for more information.

5. Claiming the child and dependent care credit: You'll need the name, address and employer identification number of the child or dependent care provider to get the child and dependent care credit, on Form 2441. If you are missing any of those components, IRS will reject the credit. Your state will probably reject it, too. California insists on getting the provider's phone number, too.

The child and dependent care credit is limited to expenses up to $3,000 per person (up to $6,000 for two people). Your expenses are much higher than that, right? See if any of the expenses qualify as medical expenses. When the costs are for the benefit of someone with a disability, you may be able to use the excess over the child and dependent care credit limits on Schedule A.

Wednesday, February 11, 2009

Net Worth vs. Cash Flows

By Ryan Dennin

It seems many people have different ways they may measure how “well off” they are with their personal finances. To some college students it could be how much cash they can bring out to the bar each weekend, or if they have enough to put a down payment on their own apartment or vehicle. It seems as people evolve in their finances however that there is some debate as to what the best measure of a healthy financial situation.
The rationale of keeping up with the Jones’s isn’t the best way to measure how successful a person or family is with their personal finances. A person’s ability to own nice cars and a big house doesn’t mean someone is successful in fact it could mean the exact opposite.
When looking at some metrics some people say net worth is the best gauge for your finances. Net worth looks as assets – liabilities. The problem with looking at this alone as outlined by an article in Personal Money Tips is that “You might end up with assets that don’ generate income. If there are unexpected changes in your income or expenses i.e. the cash flow, you could be in trouble.” Another good metric to gauge is cash flows. An article on Amateur Asset Allocator suggests that “Cash Flow is King” and goes on to say that Cash flow is the only true measure of wealth. It’s not how large your wad of cash is that matters, but rather the amount of income it produces. In the end I think it’s important to look at a combination of the two snapshots to get a clear picture as to someone’s personal financial picture.


Sell stocks or stay put

The value of your portfolio is dwindling by the day. So what should you do about it?

By Walter Updegrave
Copied and Posted by Jennifer Ng

Question: I've been sticking with my investments in the hopes that the market will recover, but I'm tired of seeing the value of my portfolio continue to drop. Should I just sell everything, put the proceeds into money-market funds and bonds and wait until we see an upturn before getting back in the market? Or should I hang in there with my present portfolio of stocks and mutual funds?  Eric Rosenberg, Little River, South Carolina

Answer: You've asked two questions that I'm sure nearly all investors are grappling with today to one degree or another.

Given the market's dismal performance, should you sell your stock holdings, hunker down in safer investments and jump back into equities after stock prices have rebounded?

Or should you just ride out these tough times with the portfolio of stocks and funds you already have?

It may seem that by answering the first question, I would also automatically be answering the second. But in fact, even though these two questions are related, they require separate answers.

So let me start with the first: The answer is no.

Dumping stocks
On the face of it selling now, sitting safely on the sidelines and then reinvesting once stock prices have recovered seems like the obvious choice. After all, why own stocks when the market is struggling if you can simply wait until the turnaround arrives and buy in then?

Click here to read more


By Jennifer Ng

Many companies and consumers are now adopting crowdsourcing to cut down on costs. Yahoo Finance states, “Crowdsourcing, as it's called, allows you to post a project or task online so several people may bid for the work. The cost to do so is often a fraction of the regular price.” Companies are using this as an alternative to outsourcing. Consumers are discovering the usefulness and inexpensiveness of the concept. Yahoo Finance names five tasks crowdsourcing can help you save money in.

1. Research: Working on a project that you have little knowledge of
2. Custom–design projects : If you have no artistic or graphic design skills and are looking for designers
3. Personal Assistants: Looking for help on administrative work such as managing personal calendars, organizing files, transcribing notes, etc.
4. Financial Advice: Help with preparing your personal taxes for just $8 an hour; a similar service at H&R ranges from $150-$200
5. Specialized Help: Searching for a personal shopper, professional chefs, dance instructors

Some popular freelance sites include,,,,, and


The Emotional Burden of Debt

By Brian Redhead

Today’s financial crisis is devastating individuals of all ages. Depending on the source, the average household’s credit card debt is between $6194 (Buck) and $7430 (Wenzl). Although financial advisors caution against multiple accounts, most people have between four and six credit cards (Buck). No one seems to be immune from the struggle as even high schoolers are entering the adult world with astronomical debts (Buck). Educators aim to reverse this disturbing trend by providing comprehensive training on budget construction and debt management.

According to a recent New York Times article (Dunleavey), many Americans cannot afford the life they are leading. Senior citizens and those trying to live with fixed incomes find this task especially daunting. It’s essential to stop spending and find a way to differentiate between wants and needs. Budgeting is much more than a money matter. Just as living with a debt is an emotionally draining experience, the road to freedom from that debt is a serious undertaking that requires diligence, sacrifice, and commitment. Saving is another important way to effectively counter debt, but it’s a luxury that many Americans can’t afford.

Some financial advisors have even questioned whether saving is best for our wilting economy. The “paradox of thrift” relates to the negative effect on the economy when Americans stop spending (Wenzl). Still, most experts agree that individuals need to be careful not to spend more than they can afford. If any optimism can be found from the dismal experience of living with sizeable debt, it’s the increasing awareness of the need to carefully manage household finances. Young people are recognizing the importance to learn life skills that include money management and their older counterparts are learning to balance already oversized budgets.

Buck, H. “Falling Prey in a Plastic Jungle.” 7 February 2009. 10 February 2009

Dunleavey, M. P. “Change Your Thoughts, Change Your Spending.” The New York Times 6 February 2009. 10 February 2009

Wenzl, R. “Should We Spend or Save?” The Wichita Eagle 9 February 2009. 10 February 2009

Tuesday, February 10, 2009

layoffs and gendor

Copied and Pasted by Rie Umano

Jonathan Steuer of New York has the familiar characteristics of an “evolved man.” He can speak fluently about the different waves of feminism, and he shares child care and household responsibilities with his wife.
But on the subject of job loss, he contends that the stakes are much higher for men.
Mr. Steuer, 43, was recently laid off from his job at a small research business. “It’s hard not to imagine yourself as the breadwinner,” he said. “A lot of your ego eggs are in the job basket. I can’t shake the psychology that I’m supposed to provide.”
His wife, Marjorie Ingall, a columnist at The Jewish Daily Forward and a contributing writer at Self magazine, says she believes that it is impossible not to absorb the cultural message that the man is supposed to provide for his family.
As job losses reverberate across the economy, differences in “his” and “her” layoffs are beginning to take shape — revealing gender dynamics that may not have been as apparent when the Dow was at 14,000.
Dr. Louann Brizendine, author of “The Female Brain” and a psychiatrist at the University of California, San Francisco, says that women who lose their jobs “aren’t going to take as much of a self-esteem hit” as men. That is because the most potent form of positive social feedback for many men comes from within the hierarchy of the workplace. By contrast, she said, women may have “many sources of self-esteem — such as their relationships with other people — that are not exclusively embedded within their jobs.”

Click here to read more

Help college students with extra aid


During this recent economic crisis, most college students and their families are having hard time to pay expensive college tuition. According to the National Association of College and University Business officers, it is getting harder and harder to get endowments due to the state of the economy. College endowments’ investment fell 23% compared to last year. However, according to the colleges’ financial-aid offices, currently there is a steep increase in requests from families for more aid. The article states that “Syracuse University reports a 30% increase in financial-aid appeals that it has granted over the same period.” Our chancellor, Nancy Cantor also mentioned in Syracuse University News that the university is seeking to keep the tuition increase rate in a rage well below what it has been for the last several decades or more, and responding the financial aid requests as quickly as possible. The article says that Syracuse University started a program called ‘Syracuse responds” which is a fund-raising initiative. It was started to help families that face with difficulties due to the financial crisis. It helped more than 350 students by raising $850,000.
Many other top private colleges increased aid for families including middles and upper-middle income families. Colombia University eliminated loans for all students and replaces them with grants. Those strong supports from college are really helpful for many college students in the U.S.


The Art of Credit Card

by Greg Lipinski

Most Americans carry between 5 and 10 credit cards. Some, they say, carry up to 50. While others detest the idea of having a credit card altogether. It makes sense; we have a very diverse society. Some people need immediate gratification, while others will work overtime for 3 years to purchase a product, service, or otherwise. Some are eligible for more credit than others. There are a variety of factors that play into this situation. However, no matter your situation, there are ways to properly utilize your credit card.

Using credit cards has a variety of benefits (emergency funding, establishing credit for larger purchases, etc.) but needs to be used wisely so as to not have your spending come back to haunt you later in life. First and foremost, experts say that a range of 2 to 6 “credit vehicles” is acceptable. The term “credit vehicles” includes credit cards, car loans, mortgages, etc…. all forms of credit. This means avoid cards that are marketed primarily with their deals attached to them; they tend to rack up in numbers and can ruin your credit score. Examples of these can include card offers at sporting events or store sponsored cards that people open to receive an initial discount. Be sure to have a widely accepted card, such as a Visa, Mastercard, or American Express.

Making purchases on a credit card is a good thing (because it builds your credit score), however, you must follow these two rules:

1) Pay them off regularly, and if you can’t, make the largest payments you can make.
2) Never reach your limit. Experts say to keep your debt ratio under 50%. This means if you have a card with a $4,000 limit, don’t rack up a balance about $2,000. If you have a large purchase, split it between two cards.

Follow these rules and you’ll find yourself in good standing with creditors, which can help immensely later in life when you might need funding for any sort of endeavor. And if you refrain from credit cards completely or haven’t gotten one yet, don’t fret; you also can open a line of credit on factors other than credit history. Banks can look at your bank accounts, employment history, and history of residence to assess your credibility, which could come in handy if you’re short cash in the advent of an emergency or an opportunity you just can’t pass up.


Monday, February 9, 2009

In Tough Times, Stick With Your Plan

A fighter pilot worries about the market, but he continues to buy.

By Jeffrey R. Kosnett
Posted by Greg Lipinski

Our Reader
WHO: Josh Andrews, 32, Married to Kelli, and father of Eli, 2
WHAT: Captain, USAF
WHERE: Moving to Creech AFB, Las Vegas
SYMPTOM: Spooked about his investments, Plus he may change careers in a few years.

Josh's job flying F-15s is dangerous enough. But these days, managing his investments can seem just as perilous as he watches stocks tumble toward earth.

Fortunately -- and perhaps not surprisingly for someone trained at the Air Force Academy -- Josh is disciplined.  Even though his six stock funds have lost from 28% to 46% so far this year, Josh diligently adds a few hundred dollars a month to several of them for his Roth IRA and his wife's spousal IRA.  He is surprised by the extent of the losses, but not terrified.  "I see the current market downturn as an opportunity to buy cheap," says Josh.

To see more of this article, click here.

Green…One of Many Things the Environment Has in Common With the Money

by Greg Lipinski

“Green” is simply no longer a color for me. “Green” has come to embody a thought process by people and organizations to find ways to make their way of living life or going about business congruent with saving or preserving the environment. If someone were to ask me, “How can I be green?” I would immediately answer, “Change your lights to compact florescent light bulbs.” Though some might see a few gallons of Forest Green paint from your local Home Depot as the solution to that question.

Many people have joined this “Green” movement, and you should to…as soon as possible. I understand that in Syracuse, New York, it’s difficult to understand the concept of global warming when you’re walking into 20mph winds at below zero temperatures. You might hate Al Gore and all he stands for, but the fact of the matter is there are other advantages in being “green”. Now, being “green” can even save you or your organization money in a variety of ways. However, waiting to make such investments might cost you in the end.

Take, as an example, Adobe Systems. Interest in the idea of saving money/Mother Earth started with an employee enquiring about the efficiency of having single-serve creamers in the break room or an economy sized manner of distribution. The company wound up investing $1.1 million over the course of a couple of years, and is yielding about $1 million in annual savings. Not only did they save money, they also created themselves an identity as a socially and environmentally responsible company. It was a very well spent investment. However, that article was published in 2006. Imagine the benefits Adobe and companies like them are seeing now in our current economic state. Although the company’s stock value has fallen, it definitely would have taken a much more substantial hit if it hadn’t been for it’s massive “green” movement that annually saves them about $1 million.

The question you might be asking yourself now is, “What is the benefit of an average Joe like me investing in “green” technology and processes? There’s no benefit for me.” Well, you’re wrong. There are a variety of things you can change in your lifestyle that can save you money and help the environment. Like I mentioned before, compact florescent light bulbs (CFL) are a good investment; replacing five incandescent bulbs with five CFL’s could save you 50% on your lighting bill. You could even save money in your eating habits. Most people look to grocery stores for produce, but the freshest, best tasting, and often times, cheapest produce is at your local farmers market. Plus they don’t use gallons of fuel transporting it. These are just a couple of ways that being “green” can benefit you as consumer. For more tips on ways to be “green” and save money, click here. Most importantly, do it quickly. Consumer trends show that we are a bit slow on the uptake of critical information. When gas prices peaked in the 80’s, there was a craze for fuel-efficient vehicles. People held onto their vehicles and their mindset of “I need to save money on gas” well past the point when gas prices came back down. Then somewhere along the lines, people began using gas-guzzling SUVs because they’re safer and gas was cheap. Prices soared and people still drove the larger, less fuel-efficient vehicles. Although prices have dropped over the last year or so, gasoline is a commodity with an extremely volatile price that can peak at any moment.

The point? There are only benefits that can arise from being “green”, either personally or in business. So don’t wait until the last second, it might be a minute to late for the Earth and a dollar short of your next month’s rent.


Lowering Medical Bills

Pasted by Brian Redhead

Twyla and Robert House have excellent health-insurance coverage. But after Robert was hospitalized twice within eight months, they ended up owing more than $6,500 in out-of-pocket medical expenses. The Little River, S.C., couple dutifully paid a portion of the balance each month until they whittled it to about $2,000. At that point, they decided to try a new tactic. Robert offered to pay off his bill in a lump sum if the hospitals would give him a discount. "We had an extra $1,300 in savings," says Twyla. "Robert told them, 'This is how much I have, and if you want your money, or at least a big chunk of it, you'll cut me a deal.'" The gambit worked.

The hospitals agreed to deduct more than $650.
The Houses used the same strategy last year when their daughter, Elena, had gallbladder surgery. As soon as they received a bill, Robert asked for a deal. He rejected the initial offer to knock off 15% and held out for the same 25% break he had received before, shaving about $400 off the bill.

Your out-of-pocket share of a hospital bill can be a budget buster, and now health insurers are passing along even more of the costs. For example, many are raising deductibles, and some are switching from co-payments (such as $20 per doctor's visit or per prescription) to a co-insurance system that makes policyholders liable for a percentage of the total bill. Over the past five years, for instance, 70% of Cigna insurance policies have shifted from co-payments to co-insurance.

By comparison-shopping and negotiating the best price -- the same tactics you would use for any other major purchase -- you can trim your bills. "You have to wonder why some people don't give the same time, effort and attention to their health-care costs as they do to other major financial decisions," says Tom Bridenstine, the managed-care ombudsman with the Virginia Bureau of Insurance, who helps consumers with health-insurance issues.
Evaluating health-care services based on price doesn't mean you'll sacrifice quality. And you'll find plenty of help from employers and insurers, who also benefit from lower costs. The following tactics will help you save hundreds, if not thousands, of dollars on your medical expenses.

1. Ask for a price break. Follow the strategy the Houses used. Each hospital has its own rules about negotiating bills, but it doesn't hurt to ask. The same goes for doctors and other health providers. (For more on how to cut a deal, see Save Thousands on Your Medical Bills.)

2. Pick the appropriate facility. Where you go to receive care can make a huge difference in your costs. Emergency-room visits tend to cost $300 to $1,000, compared with $150 at an urgent-care center, $65 to $75 at a doctor's office, and $35 to $45 at a convenience-care clinic. With a 20% co-insurance charge, that trip to the emergency room could cost you $200 versus just $7 for a visit to a convenience-care clinic. For nonemergencies, it pays to call your insurer's 24-hour advice hotline for guidance on where to go for care. Make sure the facility and provider are in your health plan's network.

3. Use online tools to compare costs. Insurers are making it easier to compare hospitals and providers based on quality and cost. And pricier doesn't always mean better. "Hospitals with low complication rates and high survival rates tend to have lower costs," says Jeffrey Kang, Cigna's chief medical officer. Companies such as Cigna and Aetna have integrated Web tools that let customers search by ailment (such as diabetes or wrist pain), then find appropriate local doctors, including an assessment of their fees and quality of service. In certain areas, Aetna includes specific fees for up to 600 procedures. Click to read more.

Can Genetics Influence Financial Decisions?

Posted by: Ryan Dennin

Would you rather earn $50,000 a year while other people make $25,000, or would you rather earn $100,000 a year while other people get $250,000? Assume for the moment that prices of goods and services will stay the same.

Surprisingly – stunningly, in fact – research shows that the majority of people select the first option; they would rather make twice as much as others even if that meant earning half as much as they could otherwise have. How irrational is that? Click here for the rest of this article...

Wednesday, February 4, 2009

The new rules of mortgage lending

Shopping for a home loan? Things have changed - here's what you need to consider.

Copied and Posted by Jennifer Ng

If you're shopping for a mortgage these days, it's a whole new world out there.
"There have been a huge number of changes over the past few years in mortgage borrowing," said Gibran Nicholas, founder of the CMPS Institute, which trains and certifies mortgage advisors.
Of course, many of the subprime loans that helped fuel the housing boom - those that didn't require borrowers to show any proof of income, or that let homeowners make minimum payments - are are simply no longer available.
But even buyers looking for a traditional mortgage are now faced with different factors to consider.
Here is what you need to know:
Paying up-front points. Borrowers can pay points - one-time, up-front fees - in order to reduce their mortgage's interest rate over the life of the loan. One point represents 1% of the mortgage value.
But they often assume that they should never pay points, according to Alan Rosenbaum, founder of mortgage broker Guardhill Financial. That's a mistake, in his opinion.
When interest rates were high, paying points didn't make sense because borrowers were very likely to refinance after rates dropped. They wouldn't hold their original loans long enough to recoup their up-front costs.
But now borrowers can get a lot more bang for their buck. The old rule of thumb was that paying one point at closing could lower their mortgage's interest rate by a quarter percentage point or so.

Invest for College

By Jennifer Ng

College costs have been increasing steadily every year. Private colleges now costs up to $40,000 to $50,000. Take for example; Syracuse University now costs over $40,000. Therefore, the earlier you start saving for college the better. A great way to do this is by investing. According to CNN, stocks are the best choice because you can gain more returns by putting more money into bonds and cash.
A top investment plan includes the 529. A 529 savings plan is “a tax-favored investment account specifically designed to help cover college costs.” Everyone is eligible to contribute to a 529 and this plan is offered through individual states. This is a great plan because they offer tax breaks. CNN states, “Qualified withdrawals are now free of federal tax and most plans let you save between $100,000 and $270,000 per beneficiary. Plus, there are no income limitations or age restrictions, which means you can start a 529 no matter how much you make or how old your beneficiary is.”
Another smart choice is the Coverdell Education Savings Accounts. This saving plan is a “A tax-favored investment account designed to help cover any qualified educational expense, including, for example, the cost of a private secondary school.” Unlike the 529s though, they offer a much lower contribution.

Tuesday, February 3, 2009

Will Obama's New Plan Help You Pay for College?

Copied and Pasted by Rie Umano

TALK OF PRESIDENT OBAMA’S economic stimulus package tends to focus on the economy’s most ailing parts — housing and employment — but if the president gets his way, families may see some relief in paying college bills, as well.
The stimulus package, which Congress is slated to vote on Wednesday, aims to spend $125 billion on education over the next two years. Should it pass, billions will be spent on education at every level, from early education and Head Start programs for underprivileged kids, to universities and college students seeking loans and grants.
If Congress and the House of Representatives pass the bill (the House is expected to vote in the next couple of weeks), a reconciled version of it will be presented to Obama for him to sign into law.
For families with children heading off to college, the fate of the bill could make a big difference in how they fund next fall’s tuition bill. Here are answers to some key questions about the president's proposal.

Clike here to read more

Students pay for internship

Posted by Rie Umano

Getting summer internship is one of important tasks for college students. The article, “Do you want an internship, it will cost you” states that the number of parents who help their kids to get summer internship by paying money to the company. Surprisingly, some parents buy internships outright in online charity auctions. While the economic goes worse and worse, the demand of internship-placement program has increased from 15% to 20% over a year. It seems like parents also understand that having summer internship is a huge advantage and something stands out in a competitive job market. However, the critics argue that there are huge unequal gap between affluent families and those who are relatively poor family. While those affluent families can afford for the expensive summer internship placement program, or have all kinds of connection to get their kinds the summer internship opportunity, those who are not affluent cannot get internships easily. The internship-placement program costs about $5000 to $9000. Those program guarantee the internship opportunity, otherwise, they refund your money. Other parents are paying for consultant for their kids to get an internship. They revise the students’ resumes and cover letters and mail them to hundreds of companies. In my opinion, the way to get an internship by paying money is wrong. Parents should not help their kids to get an internship because it just spoils them. You don’t pay for your job; you need to get paid for your job.


Monday, February 2, 2009

10 Financial Commandments for Your 20s

By Erin Burt
Posted by Greg Lipinski

When you're in your twenties, change is a way of life. You're choosing a career, paying your own bills, getting your own place to live and perhaps making decisions about marriage and family.

The more things change, the more important a stable financial foundation becomes. We've listed ten principles that should be carved in stone for every twentysomething. No matter where you are on the pathway to independence, these time-tested guidelines will boost your odds of financial success.

1. Plan ahead. To get where you want to go in life, you need goals and a plan to reach them. Having neither is like driving a car without a steering wheel -- with your eyes closed.

Start by asking yourself what you want in your future. Think about the short term (five years or less), medium term (five to ten years) and long term (20-plus years). Now you're driving with your eyes open. Then take hold of the steering wheel to reach your goals. Budgeting is a great way to do this. It allows you to see where your money is going so you can make the necessary adjustments to get you where you want to go. Learn more about how to set up and use a budget.

Click here to view whole article.

Credit Card Payments too High? You can Negotiate!

By Brian Redhead

Roth Vs. IRA

By Ryan Dennin

Understanding the difference between a ROTH vs. IRA investment for retirement is important. Which is better for you? Watch link to understand more...