Credit Card Companies Are Still Looking For Ways to Make Profits

By: Sara Sindelar

Credit Card companies have always been tricky in getting as much money as they possibly can out of a cardholder. There are 5 ways that card companies really get you. First is rate hikes where they automatically increase your borrowing rate without telling you. Second is adding on new fees to your card. These can include inactivity fees, annual fees, monthly fees, overcharging fees, these can be endless. Third is making a higher monthly minimal payment jumping from 2% to 5% without any advance notice till you receive your bill asking for more money. Fourth is decreasing the amount of rewards you get for swiping your card. Lastly is decreasing your credit limit. A lot of consumers have complained about purchasing something and getting their card denied. The card companies will also cancel your card if it is inactive as a safety precaution but not good when you go to use it and it is denied. These added fees and increases in payments are really hurting cardholders especially those who are living pay check to paycheck and rely on credit cards to make it through.

Congress is working on a reform bill that came out in May for credit card companies to stop all of their pricey tricks. The first part, which will start in February, will put limits on when issuers can raise rates on existing balances and new cards. Congress is hoping that this bill will help credit card holders but there is a great fear that the companies will keep finding ways around it to make a profit.

http://www.thedenverdailynews.com/article.php?aID=6195

http://www.fortmorgantimes.com/ci_13674428

http://money.cnn.com/galleries/2009/news/0910/gallery.credit_card_evil_things/index.html

Remodeling? It's a waste of money

Posted by: Lily Mei

By Liz Pulliam Weston
MSN Money

There could be one upside to the real-estate implosion. Plunging prices finally could shatter our national delusion that home improvements are somehow an "investment" in our homes.

Think about it:

* With a real investment, you commit your money and hope to make some kind of profit.
* With remodeling, you're all but guaranteed a loss.

Even at the real-estate market's peak, most remodeling projects didn't pay for themselves.

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Getting Paid to Take Care of Mom or Dad

Posted By: Sara Sindelar

Edited by NIKKI WALLER

A huge swath of Americans -- nearly a quarter of the adult population -- provide long hours of voluntary care for older or sick family members and friends. These numbers are likely to grow as the population ages and more people live longer.

A small but growing number of families are taking an unusual step to acknowledge family caregivers. Rather than leave uneven bequests for their heirs, they are entering into formal "caregiver contracts," in which adult children or other relatives are hired, for modest salaries, to take care of elderly or disabled family members.

These arrangements, also called personal-service or personal-care agreements, help reward family members for the significant amounts of time, effort and money they often spend taking care of an elderly relative. They also can help reduce the size of a person's estate and may prevent battles between siblings and other family members.

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Getting a Mortgage In This Day and Age

By Jameel Murray

Getting a mortgage can be extremely difficult these days. Mortgage lenders are paying an increased amount of attention to several factors. One of these factors includes a borrower’s credit score. Lenders are requiring that a borrower have a credit score no lower than a 660. This can be one of the determining factors in one’s mortgage payment. In the past, borrowers with a high debt-to-income ratio such as 55 percent were able to receive a considerable amount of loans. After the housing crisis, the maximum percentage of debt ratio is around 40 percent. Another determinant of the amount of loans a borrower may actually receive is the borrower’s actual income. In the past, borrowers were known to exaggerate their earnings but now lenders are requiring borrowers to provide verification of income through a series of paper work. A borrower’s liquidity also determines the amount of loan coverage one may actually receive. Banks are requiring borrowers to have an adequate amount of money available to cover payments.
Even though these requirements may scare some borrowers away from buying a home, there are several options borrowers are presented with. One option may include the idea that borrowers may need to put down a more sizeable down payment on a home. This ensures a lender’s trust in your request for a loan. Borrowers also need to have their finances set before going in for a loan. If finances were erratic, lenders would be discouraged to lend off money. One last option a borrower may have is to purchase a house where the value is going to increase. Banks may deny borrowers loans based on the speculation that a home’s value may decrease.

Sources: http://www.nytimes.com/2008/06/01/realestate/01cov.html?pagewanted=2

http://www.bankrate.com/brm/mstep.asp

http://www.bestsyndication.com/?q=20091025_finding_the_best_home_mortgage_rate.htm

Fun ways to learn Personal Finance

By Alma Zhumagulova

In the face of the economic crisis there have been many articles, news and TV shows on how to avoid financial problems. People became aware of the many mistakes they made in managing their finances. Everyone knows that it is always better to prevent the problems than to try to correct mistakes when they happen, and it is always better to start as early as possible. Recently, the media has been bombarded with suggestions on how to do that. To recover the economy it is necessary to teach the young generation how to avoid the mistakes of the past generations.
PBS runs a show that teaches young adults some basic financial knowledge such as choosing the appropriate credit cards, avoiding and getting out of debt, insurance and retirement planning, budgeting and saving for long-term financial goals.
Universities and colleges are adding personal finance classes to their class offering. George Washington School of Business has added Personal Finance class to its curriculum that is available to juniors and seniors of all majors. Even some high schools are starting to do that, for example, the Medway High School in Massachusetts. The semester long class covers such topics as credit, stock market, debt, income, spending and saving.
However, children and young adults might think that they don’t need to be concerned about these issues at this stage of their life, it might seem too boring and difficult. To increase their interest and teach finance in an easy and fun way there are financial computer games such as Celebrity Calamity in which the player acts as a financial manager of a celebrity, The Great Piggy Bank Adventure – a game for children of age 8 to 14, Stagecoach Island and Moneytopia. The players of these games can make mistakes and learn by them which would be very costly in the real world.
Even though these means of introducing children and young adults to finance do not guarantee that children and teens will learn and remember all the lessons taught, these means will at least help to increase awareness among this age group about the many financial issues they will face in just a few years.

References:
1. http://media.www.gwhatchet.com/media/storage/paper332/news/2009/10/29/News/School.Of.Business.Adds.Personal.Finance.Course-3817252.shtml
2. http://www.chicagotribune.com/business/yourmoney/chi-tc-biz-ym-fun-1025oct25,0,2823992.story
3. http://video.pbs.org/video/1245775469/
4. http://www.boston.com/news/education/k_12/articles/2009/08/20/schools_in_west_suburbs_push_new_personal_finance_curriculum/

Loans Inrease

By, Meredith Anderson

With the economy where it is now people are taking more and more loans. It seems scary to be borrowing money but it’s one of the greatest ways that is keeping the economy stimulated. If people don’t have the money to buy anything business will go out of business. As risky as it sounds people that are taking loans and paying at least some of them are actually helping the economy grow ever so slightly. Business and banks are offering even lower loan rates to attract more people. Auto companies are offering cheaper prices on cars as well as offering lower loan interest rates. Home prices have become more affordable do to the decrease in real estate action. Student loans have increased over the past couple years as well, however, not because of the idea that “this is the time to buy,” but because of the increase in college tuition and the decrease in many families incomes.
All these three types of loans are stimulating our economy now but how will they affect us later? If the economy doesn’t bounce back to where we predict than many people will become even more in debt. The problem with loans is that they seem great and are easy to obtain. Because it is so easy to obtain these loans people are buying homes, cars, and other items that they couldn’t usually afford and will have a lot of trouble paying back even if the economy does turn around.

Sources:

http://www.ed.gov/news/pressreleases/2009/09/09142009.html

http://www3.myautoloan.com/articles/myAutoloan-com-Experiences-Dramatic-Increase-in.htm

http://www.allbusiness.com/business-finance/business-loans/938679-1.html

Strategy on Buying Car

By Quang Nguyen




Most people look forward to buy their first car and their first house. When buying car, people do not think carefully about the process. Here lies the issue, buying a car can be a difficult task and much of the simple steps are commonly overlooked.

First of all, you need to evaluate your current financial situation to find out how much you can afford in terms of whether you are going to finance the car or buy it outright. If you are buying a relatively new car, chances are you will have to finance the car and pay monthly payments.

New vs used is a common question people ask themselves when buying a car. You may be able to afford more car by going used but you know what to expect from the car when buying new. If you take the used route you are going to want to learn about the cars history. Carfax.com is a great site that provides the “medical history” of the car. It will let you know what the cars history has been like in terms of it being in the shop. You will need to know the title of the car. Usually, it is not a good idea to buy salvage title car even though it is very cheap.

In conclusion, you will need to budget yourself properly to ensure that you can afford the monthly payments if you chose to finance the car. You must also take into consideration the cost of insurance as well as put money aside for unexpected costs the car may incur. Maintaining your car can be as much as several thousands dollar each time. Gas can also costs as much as several hundreds dollar a month.

References:
http://auto.howstuffworks.com/buying-selling/car-buying.htm
http://www.carbuyingtips.com/carintro.html
http://www.boingboing.net/2008/08/13/how-to-buy-a-new-car.html

Benefits of a 401(k)

By: Nicole Nelson

A 401k is an employer-sponsored retirement plan. The term 401k comes from the fact that the origination of these types of plans comes from section 401k of the Internal Revenue Code. A 401k plan is a defined contribution plan that lets an employee make pre tax contributions to their plan. 401k plans take money out of employee’s paychecks before they are taxed, reducing taxable income. These funds are then invested into various funds in the 401k plan, decided on by the employee.

401k plans can be very beneficial in retirement planning because of their benefits. One benefit is that the employee is reducing their taxable income, which can be beneficial when paying taxes as opposed to taking money and investing/saving it after being paid. Also, growth in 401k accounts over the year is taxed deferred, again saving money in taxes. Also, many employers give employees the chance to get “free money” from their participation in 401k plans. Employers match contributions (up to a certain percentage depending on the plan) if employees are contributing enough of their own money. Also, it is known that the sooner you start saving, the larger your funds will become in the future. Therefore by putting money into a 401k can easily grow over the years. Another benefit about 401k’s is that you can borrow against your own funds. 401k loans are common and you are technically borrowing your own money. The downside about this is that you loose the chance of earning money on the investments that you will be missing out on because of the loan.

Source One

Source Two

Source Three

Unemployed tap their 401(k)s

Posted by: Nicole Nelson

By: Ben Rooney

NEW YORK (CNNMoney.com) -- Nearly half of U.S. workers who left their job last year cashed out their 401(k) accounts, according to a study released Wednesday, despite ongoing efforts to dissuade Americans from doing so.

Hewitt Associates, a global human resources consulting firm, said 46% of employees who left their job last year took a cash distribution from their 401(k) plan.

The "alarmingly high" number, which was based on a study of 170,000 401(k) participants, has remained virtually unchanged since 2005, the group said.

Pamela Hess, Hewitt's director of retirement research, said employers and policymakers need to work together to change employee behaviors and reduce 401(k) cash-out rates.

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Personal Finance Website to Debut

By William N. White
Posted by Jameel Murray

After the 2008 subprime mortgage meltdown revealed widespread unfamiliarity with the intricacies of personal finance, one former Harvard Business School student is on a mission to educate young people about managing their money.

On Nov. 15, Alexa L. M. von Tobel ’06 will launch LearnVest.com, an interactive financial information Web site geared toward women.

The start-up features personalized information on credit scores, mortgages, and retirement savings, among other fiscal topics. Von Tobel, who is taking a leave of absence from HBS to work on the project, calls it “the Cliff Notes for personal finance.”

“The bottom line is most people don’t know what the difference between a debit and a credit card is,” said von Tobel, adding that most students at Harvard will graduate without ever having taken a class in personal finance.

Von Tobel—who first envisioned the Web site during her senior year at Harvard—said that LearnVest aims to be more personalized than other financial Web sites. It walks users through financial milestones from getting a first job to paying off student loans, then offers gift cards and other rewards when they complete units on the site.

The Web site is designed for women under 30, though von Tobel emphasized that LearnVest is open to anyone.

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Barter for the Services You Need

By: Jessie Bruyn

Camille Tominaro's vacation home near Hunter Mountain in New York could use some new floors and a good paint job, but she doesn't have the money to hire a professional to do the work.

So, to get the job done, she is using another form of currency: her house. In exchange for getting the home improvements done, Ms. Tominaro is offering painters and carpenters a free stay in the vacation home.

Cash-strapped consumers are increasingly bartering to get needed products and services. If you're considering bartering, here are a few things you should know:

Web sites that allow people to post ads for barters, such as Craigslist.org and U-Exchange.com, can help you track down someone who provides a service or product that you want and needs what you have. You can place an ad detailing what you're looking for and what you have to offer in return. You also can respond to an ad you think would be a good fit.

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3 Ways to Improve any Credit Score

Posted by: Jessie Bruyn

How to Play It: The New Normal

By Jonathan Tse



Every decade or so, investors are told to heed a new megatrend, whose chief appeal is, well, its newness. In the ’90s, investors were sold on the notion of a New Economy that wasn’t subject to the old laws of gravity and, among other things, could support higher stock valuations. And one of the best-selling investing books of the past decade was The New Investment Superstars, a tome that canonized a new breed of fund wizards, some of whom later proved to be mortal. Now comes the latest investment fad, the “new normal,” the idea championed by Pimco bond guru Bill Gross that the U.S. has entered a period of diminished expectations that requires investors to rethink their long love affair with stocks.

There’s a certain Biblical undertone to the new normal orthodoxy: After decades during which consumers lived beyond their means, the nation must now endure a long stretch of lean years during which consumers pay down debt. In the minds of Gross and Pimco colleague Mohamed El-Erian, the prospect of a period of no growth means investors should hold as little as 30% in stocks, vs. the 60% long deemed the proper mix. They also recommend holding more fixed-income assets like bonds and bank loans, as well as commodities.

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redit card borrowers will see minimum repayments double under new proposals

posted by Shawn Gao
he move is part of a package of measures announced by the Government to tackle consumer debt amid the recession.
It said forcing credit card companies to raise the minimum monthly repayments would encourage people to focus on paying off their debt.
The minimum amount that the majority of companies currently require card holders to repay should be raised from just 2 per cent of the amount owed, to 5 per cent, it suggested.
The increase could cut the time a borrower takes to repay a £1,800 credit card debt to ten years – compared with 40 years at 2 per cent. It could also reduce the amount repaid by almost £4,000, according to the Department for Business, Innovation and Skills.
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Chinese investment

posted by Shawn Gao

People in China are willing to invest their money in stock market.
Today, many experts predict that China is the first country that gets out of the recession. As result, Chinese GDP for the first three quarters is above 7percent. Comparing with other developing countries, it GDP growth rate is dramatic higher. The consumer’s buying confidence has been built up this year. Chinese people are willing to invest their extra money in Chinese stock market. People opened their bank account in order to get quick money from the stock market. Chinese stock market has already reached the bottom line; now the index of the stock market is above 3000 points. (The beginning of this year is only 1800) Currently, people are spending their money as they did in 2007. The housing price has been gone up. Shanghai and Beijing, lead-housing price in China, have been reflecting Chinese economy is going well. On August, Chinese Government just started its Chinese NASDAQ. Many new IPO have been operated. And Chinese people now are going to allocate some of their extra money in the new stock market so as to build their wealth.
1.http://news.dichan.sina.com.cn/2009/10/27/78236.html
2.http://baike.baidu.com/view/6240.htm
3.http://stock.hexun.com/2009-09-24/121195063.html

Personal loans lose out on rate cuts

posted by Shawn Gao
WHILE interest rates on home loans fell more than four percentage points between August last year and October this year, the rates for personal loans actually rose during that period.
According to figures from Infochoice, the average variable rate on a secured personal loan from a bank rose by 0.77 per cent to an average 11.43 per cent while that of an unsecured personal loan from a bank increased by 0.16 per cent to an average 13.89 per cent.
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posted by Shawn Gao
There are some few things that one has to consider when he is seeking to obtain a new car loan even if he has a bad credit history.
There are some few things that one has to consider when he is seeking to obtain a new car loan (www.crestcarloan.com) even if he has a bad credit history. The first thing that you have to consider is whether your loan options are better on a new car even if you have a poor credit. Basically, the new automobiles haveixed value in the beginning and clear depreciation schedule which gives a lender room to make his or her decision without any doubt.
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Finding gold in little miners

Posted by Quang Nguyen




Top-ranked metals fund manager Mark Johnson says small gold miners haven't recovered from last year's selloff. He shares his favorite picks.

NEW YORK (Fortune) -- A year ago investors fled small gold mining stocks as the desire for high-risk assets evaporated.

Now, even after investors have flooded back into the market, top-ranked gold fund manager Mark Johnson says the junior miners are undervalued, and he's betting on their recovery.

"The best value is at the smaller end of the scale," says Johnson, who is in his 16th year running USAA's Precious Metals and Minerals fund (USAGX).

Junior miners are those with less than 250,000 ounces of annual gold production, which equates to roughly $250 million in revenue at gold's current price.

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Credit Card Reform Bill Tries to Stop Evil Companies

Posted, Meredith Anderson

5 evil things credit card companies can (still) do
The credit card reform bill tries to help cash-strapped customers, but companies are coming up with new ways to boost profits.

Credit card companies are socking it to consumers left and right.
They're hiking interest rates to as much as 36% and doubling minimum monthly payments, frustrating customers who are already cash-strapped and credit-crunched.
In an effort to curb these abusive practices, President Obama signed into law a credit card reform act in May that's rolling out in three parts over 12 months.
At the same time, credit card companies have been hard at work coming up with new ways to boost profits while sidestepping the reforms.

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Personal Finance: The price of putting off a pension

Question: I have a pension that is available to me, and I wonder about beginning the pension now or waiting. If I take it now, I will get $1,183 a month. By waiting, it increases about 7.5 percent each year to a maximum of $2,071 a month at age 65. I am not in need of the pension at this time. - Gary, Baltimore
Answer: You are wise to be analyzing the possibilities rather than taking what's in front of you now and hoping it works out later.

Research shows that only about a third of people try to calculate what they will need in retirement before leaving a job or starting to take a pension. Years later, bad decisions can catch up with them: Once you take a pension, you cannot go back to your former employer and request a do-over when money is tight. And you might not be able to return to work to cover unanticipated living expenses.

The AARP surveyed retirees a few years ago and found that almost half worry about paying their utility bills. This could have been avoided.

Click here to read more.

Posted by Kelsey Hoffman

Underlining 'Free' in 'Free Credit Report'

Posted by: Nicole Nelson

Written by:Michelle Singletary

I've been meaning to pull my credit reports for some time.

I, like so many others, am concerned about identity theft or uncorrected errors in my credit files that might ding my credit scores.

When I finally got around to it, I knew to go to AnnualCreditReport.com or call 877-322-8228. I haven't been fooled by those ubiquitous commercials for FreeCreditReport.com with the goofy guy playing a guitar and complaining about how his life is messed up because he didn't check his credit report.

But the Federal Trade Commission has received many complaints from consumers who were misdirected from the official centralized site. Every person is entitled to a free credit report every 12 months from each of the three nationwide consumer reporting agencies -- Equifax, Experian and TransUnion.

to read more click here

Financial games: It can pay to play

Posted by: Nicole Nelson

Written by:Eileen Ambrose

One of the big hurdles to teaching personal finance to children and young adults is how to do so without boring or confusing them with talk of compound interest and annual percentage rates.

Now, there's a growing effort to reach kids on their own turf: online games.

More than 70 percent of people play some form of games, a percentage far higher among teens. Gaming experts see this as an opportunity to pack critical lessons into a fun activity.

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Finding the Best Way to Save for College: 529 Plan

By: Sara Sindelar

Paying for college is one of the biggest expenses for an individual and their parents. In order for people to be able to afford to send their child off to college they need to start putting money aside earlier and earlier so that it can grow to the cost of tuition when the time comes. A CNN survey states that people save about 3.6% of their annual income for college even though they really need to save 5.7%. The percentage increased from 31% to 44% of those who are confident they will not reach their college savings goal. Times are getting tough with the economy and savings is declining fast.

There are many different ways to save for college with all the investment option available. The most popular method is the 529 plan. A CNN survey states that 43% of people saving for college are using a 529 plan. These 529 plans are state-sponsored programs set up with an asset management company. The individual sets up their account with the company; the income is tax-deferred and the money needs to be spend on educational purposes.

There are a variety of 529s so you have to do some research before picking one out. The key traits to look for are low fees, flexible investment options and diversified portfolios, good performance by fund, and tax benefits. There are so many other options to 529s and you should take these key traits in consideration when picking the option that best suits you especially in the tough times right now.

http://www.chicagotribune.com/business/yourmoney/chi-tc-biz-ym-cruz-1025oct25,0,1624828.story

http://www.cbsnews.com/stories/2009/10/01/earlyshow/contributors/raymartin/main5356031.shtml

http://www.msnbc.msn.com/id/33070796/ns/business-motley_fool/

Financial games: It can pay to play

Online sites provide opportunities to teach lessons to children in a fun way
By Eileen Ambrose Tribune Newspapers October 25, 2009
Posted by Alma Zhumagulova

One of the big hurdles to teaching personal finance to children and young adults is how to do so without boring or confusing them with talk of compound interest and annual percentage rates.

Now, there's a growing effort to reach kids on their own turf: online games.

More than 70 percent of people play some form of games, a percentage far higher among teens. Gaming experts see this as an opportunity to pack critical lessons into a fun activity.

"Think about what games can do that you really can't do otherwise," said Ethan Mollick, an assistant professor of management at the Wharton School of the University of Pennsylvania. "Even in a personal finance class you don't get the chance to experiment, to be in the shoes of someone trying to solve problems.


Click here to read more

Americans expect to focus on personal finance in short term

Posted By: Sara Sindelar

A new survey finds that Americans plan on continuing to increase their savings and investments for the near future.

The survey from First Command found that Americans have less money in their savings accounts and are still paying down their debts at about the same rate as in previous months.

The average amount of money in a short term savings account was said to be $860 in September, down from $1,169 in July but up from $787 in August.

The financial institution noted that more consumers have been applying for debt consolidation loans recently, further adding to the widespread emphasis on personal finance.

In a potential warning sign to the retail industry, the survey also found that 57 percent of consumers plan to scale back their holiday shopping activities this year. This could tie in with a trend where the pace of the economic recovery is held back even as Americans continue to improve their overall personal finances.

By Bill Laforme

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Trend towards health care stocks?

By Jonathan Tse




Recently the stocks that have been performing well are the health care stocks. The reason behind this is the fact that many of the baby boomers are approaching the ages of 50-60 years old. This contributes to the expansion and growth of the health care industry as more elderly people need to purchase health care. It is estimated that in the next 18 years, 4 million baby boomers will reach age 60 and in 2030 the population would consist of 20% elderly people above the age 65. Many people are in conflict because they feel that there is a moral issue involved with purchasing health care stock. Once the economy recovers, some people feel that the health care industry will be one of the fastest growing sectors. Also, because the health care industry has been underperforming for so many years, the stock prices have become very cheap and are now starting to rise in price due to greater performance in recent years. Fears by people on the performance of other industries such as energy and housing have brought more investors to the health care industry, contributing to its current growth trend. Foreign companies have been participating in the recent trend of purchasing health care stock because they are looking for US stocks that are cheap and potentially profitable.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/08/26/BUIE12I1KN.DTL
http://www.forbes.com/2009/10/20/gentiva-amedisys-odyssey-personal-finance-investing-ideas-dress-barn.html
http://money.cnn.com/2009/10/19/pf/funds/forester_health_care.fortune/index.htm?postversion=2009101913

Renting or Selling Your Home?

by Jameel Murray

Because of the current state of the economy that witnessed the sudden decline of property value, many homeowners are faced with a difficult decision, which consists of renting or selling their property. Both options pose significant benefits for the homeowner, but there are also some daunting tasks that homeowners may have to face. If one decides to sell their property, it may generate a great amount of profit that may be used to purchase a new home. However, attempting to sell a home in this current economy may seem like a very difficult thing to accomplish simply because no one is purchasing real estate at this moment.
If a homeowner is not able to sell their property, they can also rent the property out to renters. If your home is in great shape and conveniently located, finding renters may not be a difficult task. The goal of renting is to produce monthly rent to cover expenses such as mortgage, insurance, and property tax. After a considerable length of time renting, homeowners can use the rent as another source of income. Of course there are some cons to renting which includes maintenance and taxation. Maintenance costs are the sole responsibility of the homeowner. If a renter decides to destroy your home, not only does it depreciate the value of the home, it also increases the homeowner’s expenses. Rent is usually taxed as an ordinary income. The tax on rent is gradually higher than the capital gains tax rate. Even though the option of renting does have some downfalls to it, a homeowner may need to seriously consider the option.

Sources: http://www.theepochtimes.com/n2/content/view/24198/

http://www.streetdirectory.com/travel_guide/76029/property_tips/the_advantages_of_selling_your_own_home.html

http://www.rateempire.com/sell/rent.html

Buying Your First Home

By Quang Nguyen



Buying your first home is the ultimate American dream for everyone. Many look at it as a financial decision, however, I suggest you to look at it as a lifestyle decision. If you picture yourself handling the responsibility of taking care of your lawn every week or if you picture yourself as just leaving the condo every night to hang out with friends will result in different housing options. Moreover, mortgage payments require you to save money for at least couple of years so your personality is definitely important when coming to rent or buy. In addition, real estate is immobile, so if you are the type of person who moves every year or the type who stays at one location for many year also counts toward the decision of buying a new home. The neighborhood is also very important since you would not live happily if you live in the wrong neighborhood and has to deal with issues everyday. The goal of owning a home should be for a happy lifestyle instead of a strong financial status.

So when you decide that buying a home is definitely your thing, please think twice on when to buy. Many people think that the real estate market is at the bottom and now is the best time to buy. However, that might not be the case, as the housing market is expected to be much lower. For example, in Miami, it is expected that price would continue to drop 29.9% by next June after it has already fallen 48% for the past three years. The same go for others locations, such as Las Vegas 23.9% and Phoenix 23.4% by June 2010.

When you do decide to buy a home, you really want to buy something special, something that would give your guests an awww when they visit. With the low price on real estate market, it is possible to get yourself that amazing house that you have seen on TV. In Redwood City, CA, a home with elevator and cliff-side setting and bended-roof bamboo originally costed $1.4 million; now you can get it for $1.2 million. In East Hampton, NY, with homes described as "synthesis or architecture, art and science" will take you $4 million. Or do you want to live in a castle? A 1930s cottage and stone castle in California is now on the market for $1.8 million. You want something exotic? How about a house on top of the volcano? With $750,000 and this baby in Newberry Springs, CA, will be yours. How about a lighthouse somewhere in New England like that movie? You can spend $2,873,000 to live in one of those in Deer Isla, ME.

References:

http://finance.yahoo.com/how-to-guide/personal-finance/12819;_ylt=AohAexNh03hSajStj2FjdhUJo9IF;_ylu=X3oDMTE2MzM2N29zBHBvcwMyBHNlYwNob3dUb0d1aWRlcwRzbGsDYnV5aW5neW91cmZp

http://finance.yahoo.com/news/Homes-About-to-get-much-cnnm-699910894.html?x=0

http://finance.yahoo.com/loans/article/107967/strange-homes-for-sale?mod=realestate-buy

FTC Seeking Comments for 2010 Changes on Free Credit Reports

By Faye Mergel
Posted by Jonathan Tse



The Federal Trade Commission (FTC) is changing the way “free” credit reports are marketed. Federal regulators say changes will be in line with the new Credit Card Responsibility and Disclosure (CARD) Act of 2009. The bill was first signed by President Barack Obama on May 22, 2009 with the aim of protecting consumers from onerous fees imposed by creditors. CARD Act also aims at assuring that consumers fully enjoy their rights, including the right to a free credit report once in every twelve months.

Fair Credit Reporting Act (FCRA) entitles every consumer free access to his records with the three major credit reporting agencies (CRAs). The CRAs, Equifax, Experian, and TransUnion, are mandated by federal law to give consumers their free report once a year so they can assess their debt standings. This would help them make better financial decisions since it lets consumers know how well they are doing with their debt management.

However, FTC received several complaints from consumers who are misdirected from the FTC-backed Annualcreditreport.com. As noted by complainants, they were misdirected from Annualcreditreport.com and ended up in commercial sites which claim to offer free credit reports. But it is only after engaging in irreversible deals that they found out about fees charged along their records.

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60-Second Guide to Getting out of Debt

By Motley Fool Staff
Posted by Alma Zhumagulova

Imagine being free of debt -- no more sleepless nights over mounting credit card balances, no more ball-and-chain of debt feeding your anxieties, and no chance of threats from dreaded collection agencies. You can do it! Here's the scoop -- in one minute flat.

0:60 Resolve to spend less than you make
Make it a habit as fundamental as stopping for red lights. Realize once and for all that if you can't pay for it today -- you can't afford it.

0:55 Distinguish between Bad Debt and OK Debt
OK Debt has an interest rate well under 10% -- preferably with some tax advantages to boot. In the best case, what you bought with borrowed funds will appreciate in value. Home mortgages and student loans are examples of OK Debt. Automobile loans are on the border: They often satisfy the low-rate piece, but automobiles almost never appreciate in value. Bad Debt is everything else -- from your titanium credit card to the 35% loan from Larry's Kwik Kash.

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Legally Speaking: Extreme Debt Collecting

by John G. Browning
posted by Jameel Murray

In last week's column, I related the experience of a young Illinois woman who found herself on the receiving end of a debt collection notice - sent via her social networking page!

As I pointed out, the unusual method not only cost the debt collectors a lawsuit for emotional distress, but it also could very well have violated the Fair Debt Collection Practices Act - a federal law passed to protect consumers and set limits on just what debt collectors can do to collect a debt.

But as we'll see, the pressures of today's economy have translated to more questionable debt collection activities than ever before.

There have always been the rare extreme examples of outrageous debt collection attempts. In one case, an El Paso jury awarded a couple $11 million (reduced on appeal in 1998 to $1 million) for what they endured at the hands of debt collectors.

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Six Ways to Kill Your Credit Score

Posted by Quang Nguyen




1. Be a big spender at the wrong time

The bigger your total balance as a percent of your total credit limit across all your credit cards, the lower your score will be.

Rex Johnson, founder of credit union consulting firm Lending Solutions Consulting, has spent years studying FICO credit scores - the most widely used among lenders. Scores range from 300 to 850 - the higher the better, with anything above 760 being the most desirable.

Johnson estimates that you lose 1 point for every percent of your credit limit that you use. So if you have a total credit limit of $10,000 and have an outstanding balance of $4,000 (40%), your score would be 40 points lower than if you had a $0 balance.

Ideally, credit experts say, your never want your balance to exceed 30 percent of your credit limit.

It's always good to pay off your balances every month. But creditors may take a few weeks or even a couple of months to report your payment to the credit bureaus.

To boost your score: Don't charge anything for at least 60 days before applying for a loan, Johnson said. That way it's likely that all the payments you've made to date will be reflected in your credit score by the time a lender requests it.

If you can't pay off your total balance in full, at least keep it under 30 percent of your total credit limit.

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How Bad Are Your Credit Card Mistakes?

Posted by Quang Nguyen



Grade yours on a 10-point scale.

Nobody's perfect. When it comes to our financial lives, we've all done things we later regretted -- whether it's getting slapped with a $3 fee for using an out-of-network ATM or going on a Las Vegas bender and losing the house on an overly aggressive poker bet.

The key is to understand the scale of the transgression. With credit card blunders, that's no easy task -- is it worse to take a cash advance or to pay a bill a day or two late? Experts graded a range of credit card mistakes on a scale from 1 (losing a few bucks to a cash machine) to 10 (losing the house). Find out which worry the pros most -- and which may (almost) get a free pass.

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Personal Finance and Staying Out of Debt

By, Meredith Anderson
Debt can be a scary thing and can haunt us for years if not our entire lives. It’s a constant struggle to stay above the water and keep from drowning in bills and harassing phone calls. The best way is to never get in debt in the first place. Easier said than actually done, however, there are some everyday things we can change in our daily lives that will keep us afloat and debt free. Use cash. It’s simple really, cash is a physical piece of value that you have in your ownership at that moment. Avoid credit card offers and never spend more money on a credit card then you know you can afford at the moment. You should always pay at least if not more than the monthly minimum. The interest rates can add up and end up costing you way more then you put aside.
Things don’t always work out that smoothly and sometimes we do end up in debt. The most important thing is to realize it and not accept it as a new lifestyle. Keeping track of your personal finical statements is very important. Make balance sheets and cash flow statements. Make sure that you are allocating a certain amount of money to repaying your debt and cut back spending where ever possible. You want your income to be higher than your expenses. When you have an extra hundred dollars pay off one of your credit card bills rather than going out for a nice dinner or maybe go out for an inexpensive meal and pay half of the bill. Debt doesn’t have to overtake your life but it should teach you had to be finically responsible.

Sources:
http://www.ehow.com/how_2054053_stay-out-debt.html
http://www.essortment.com/all/tipsonstaying_rhjr.htm
http://www.finweb.com/financial-planning/get-out-of-debt.html

Investing Wisely With Your Money

Posted By, Meredith Anderson

Use your mad money to make money
When you see the market moving fast, it's tempting to swing for the fences. Here's how to play the game safely.
[Related content: stocks, funds, investing strategy, stock market, ETF]
By Christopher Davis, Morningstar
If you were like many investors, you probably wanted to stuff any extra cash you had under your mattress last year. With the markets experiencing their worst crisis since the 1930s, few people had an appetite for risk of any kind. Now that the markets have roared away from their lows -- and the world looks less scary -- you might be willing take some chances.

In fact, you just may not be able to help yourself. In his book "Your Money & Your Brain," author Jason Zweig discusses why we're motivated by the prospect of reward, whether it comes in the form of money, food, drink or other primal, feel-good desires.

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Stopping the Calls

Posted By Meredith Anderson

Even good people can fall behind on their debts.

That's why we should all be concerned when some debt collectors step over the line, as explained in the question below.
Looking for financial advice? Click here to send David your questions and they might end up as a topic for his next column.
Question: Because of the hard times, people fall behind on credit card payments. I would like to know when it becomes harassment on the part of the credit card company calling you. In the last three days, the same credit card company has called a friend of mine 24 times -- as quickly as 2 minutes apart. How do you get them to communicate with one another so they know they have contacted you? It has become very annoying and some of the people that call are very rude. It is bad enough to be in this situation without people harassing you.
-- P.E., Macungie, Pa.

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When you hit 65, it's time to enroll in Medicare 101

by James L. Watt
posted by Jameel Murray

Congratulations — you’ve reached the milestone age of 65! Many things will change, not the least of which is a change in health insurance as you go on Medicare.



Many of you are filled with questions: “Will Medicare be enough?” “What kind of Medicare supplement should I get?” “What about drug coverage?” “Will pre-existing conditions be covered?” “How much will this cost me?”

I’ve got good news! You have many good choices — it’s just a matter of figuring out the best option for you!

Q. Who can get Medicare?

A. Most people 65 or older who have worked at least 10 years, while paying Social Security taxes, will qualify. Even if you’ve not worked long enough, you can still qualify, if you are the spouse of someone—living or deceased—who has worked long enough.

Persons under age 65 who have received Social Security disability for 24 months also qualify for Medicare.

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No 2010 increase in Social Security

NEW YORK (CNNMoney.com) -- There will be no cost-of-living increase for 57 million Social Security beneficiaries next year because consumer prices have fallen, the Social Security Administration announced on Thursday.
It marks the first time that Social Security benefits have not been increased year over year since the cost-of-living adjustment was put into effect in 1975.
To help counterbalance the hit, President Obama is calling on Congress to send another $250 relief payment to seniors and other Americans to stem the economic strain.
"Even as we seek to bring about recovery, we must act on behalf of those hardest hit by this recession," Obama said in a statement Wednesday. "That is why I am announcing my support for an additional $250 in emergency recovery assistance to seniors, veterans, and people with disabilities to help them make it through these difficult times."

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Posted By: Stephen Barile

Please Spare Me the Extended Warranty

By: Neal Templin

Posted By: SHEA McCABE

Earlier this year, an unwanted caller got hold of my cellphone number.

I would answer, and a computerized recording would warn me that the factory warranty was about to run out on my vehicle, but if I acted now, I could get an extended warranty.

The phone campaign told me one of two things: Either Toyota really cares about me, or selling extended warranties is a very profitable business.

But when I delved into the calls recently, the explanation turned out not to be what I expected.

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Why you should buy health care stocks now

Posted by Jonathan Tse



Health care reform may have their future on hold, but star fund manager Tom Forester says the worst is already built in.

NEW YORK (Fortune) -- With health care stocks cheap compared to the rest of the market, Tom Forester thinks that a bad-case scenario health care bill is already priced into the sector.

"These are emotionally difficult stocks to hold right now because they are in the crosshairs," says the manager of the Forester Value Fund (FVALX). But it's his job to hold onto them. "Value guys are paid to buy stocks that are cheap and have some emotional component in it."

Health care stocks are hurting the fund a bit this year, he says, but last year they helped it become the only diversified stock fund in the U.S. that didn't lose money. Forester also beat the S&P 500 (SPX) by about 40 percentage points, according to Morningstar.

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Your Life, Your Money

By Donald Faison
Provided by PBS videos on pbs.org
Posted by Alma Zhumagulova

Please follow the link to view the video on Personal Financial Planning:
Your Life, Your Money

Employees Face Higher Health Care Costs

By: Eric Gursky

NEW YORK (CNNMoney.com) -- It's open enrollment time at work. Prepare yourself. Starting in 2010, your employer is making sure that when it comes to paying for your health care, you're going to be sharing much more of the burden.

"The headline is greater cost sharing," said Tom Billet, senior consultant with human resources consultancy Watson Wyatt. "That means higher [employee] contributions, higher deductibles, or both," he said.

In 2010, employers are "putting everything on the table," implementing benefit changes aimed at making workers more aware of the actual cost of services," said Paul Fronstin, director of the health research program at the Employee Benefit Research Institute (EBRI), a public policy research group.

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Understanding Diversification

By: Eric Gursky

With a down economy many investors in recent months have learned how valuable it is or was to have a diversified portfolio. Those whose were solely invested in equity or were seduced by the high returns of Bernie Madoff lost most if not all their money in the market. Portfolio diversification is an easy way to reduce the risk of your portfolio by spreading the risk throughout many financial instruments. When diversifying there are many factors that come into play which are different for every investors.
The two main types of diversification are:

Vertical diversification: spreads your money between different types of assets. Cash, government bonds, corporate bonds, property and shares can each be expected to behave slightly differently, and so potentially produce different returns, as circumstances change.

Horizontal diversification: is when you hold different instances of the same asset class. This time you’re trying to reduce localised company or sector-specific risks, particularly with shares.

Once you have figured out which type of diversification you wish to follow you also have to understand time horizon and risk tolerance because they place a critical role into which assets work best.

Time Horizon - Your time horizon is the expected number of months, years, or decades you will be investing to achieve a particular financial goal. An investor with a longer time horizon may feel more comfortable taking on a riskier, or more volatile, investment because he or she can wait out slow economic cycles and the inevitable ups and downs of our markets. By contrast, an investor saving up for a teenager's college education would likely take on less risk because he or she has a shorter time horizon.

Risk Tolerance - Risk tolerance is your ability and willingness to lose some or all of your original investment in exchange for greater potential returns. An aggressive investor, or one with a high-risk tolerance, is more likely to risk losing money in order to get better results. A conservative investor, or one with a low-risk tolerance, tends to favor investments that will preserve his or her original investment.

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College Savings Plan

By Eric Gursky

June 16 (Bloomberg) -- If you are saving for college in a 529 plan, you probably took a bigger hit than you expected during the 2008 market crash.

What should you do now? Keep the plan or dump it?

My opinion: Stay in the 529 world but in a smarter way. These plans, run by the states, can be a great, tax-saving way to put aside money for college. You invest with after-tax dollars but the earnings are tax-free if they are used to pay for higher education.

Thirty-four states and the District of Columbia encourage contributions by giving you credits or deductions on your state tax return. You can buy a 529 from the state, at a low cost. Or buy at a high cost from stockbrokers and financial planners.

Smart idea No. 1: Buy through the state. When you open a 529, you have a wide variety of investment choices. The most popular are the age-based plans. They buy stocks while a child is young and promise to grow more conservative in the years just before college entry. Good age-based funds keep their promise. You have plenty of cash on hand when the tuition comes due.

Irresponsible age-based funds gamble on earning higher returns. They continue to hold a large proportion of stocks and risky bonds, even for 19- and 20-year-olds. These are the funds that get parents into trouble. If you are paying tuition this year, 20 percent or more of your college money might be gone.

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Save Green When You Go Green

Posted By: Shea McCabe

By ANNA PRIOR

You don't need to spend a lot of green to embark on a "greener" lifestyle.

Sure, buying a hybrid car or installing solar panels on the roof of your house are big ways to be more eco-friendly. But you also can make a difference with easy, lower-cost changes, whose savings can add up over time. Here are some steps to consider:

Your Home

The average home is responsible for twice the greenhouse-gas emissions as the average car, says Maria Tikoff Vargas, spokeswoman for the Environmental Protection Agency's Energy Star program. And the average household spends $2,200 a year on energy bills.

"You can save about 30% of that energy use," she says, and make your living space more comfortable by making your home more energy efficient.

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2009 Holiday Shopping Taking a Major Hit

By Eric Gursky
So with the 2009 holiday season quickly approaching stores are beginning to unveil new lines and get ready for what is supposed to be a flourishing time of the year. Think again, with the economy still not in shape, consumer spending and credit are nowhere near the rates of 2007. Many stores are buckling up for what could be a scary roller coaster ride.
For the second year in a row retail sales are expected to fall because of rising unemployment which has curbed gift buying. If sales do decline for the second year in a row it will be the first time this has occurred.

The year-end holiday shopping season is a critical one for retailers, and can account for 25 percent to 40 percent of full-year sales. The 2008 holiday was a disaster for retailers, as a financial crisis swept across the globe in September and consumers cut spending on nearly everything but bare necessities.

Faced with bulging racks of unsold merchandise, many retailers resorted to slashing prices 70 percent to 80 percent last year, undermining both four-quarter sales and profits.

For an industry that severely suffered in 2008 the last thing they would want to hear is that 40 % of the country plans to spend less overall on gifts this holiday season.

Deloitte is expecting total holiday sales to reach $810 billion -- a zero percent change in November to January holiday sales from a year ago. Flat sales numbers would be a good thing in comparison to the 2008 season which experienced a 2.4 percent decline -- the first decline in , holiday sales dating back to 1967, according to Deloitte.

Source 1, Source 2, Source 3