Thursday, April 30, 2009

Use Your Credit Cards Wisely

Credit cards are something which if not taken care properly can lead you in huge amount of credit card debts. I have faced this problem and so I want my readers not to repeat the mistakes I have committed and not used my Credit Card wisely. Quickly have a look on these steps which will help you to use your credit cards in an effective as well as efficient manner.

Always try to make large purchases and that also by ordering online. If you use a cash to purchase any particular product the amount of leverage will be reduced which will be very high in case you purchase with the credit card. I have never paid any interest because I always pay off on time. If you are able to follow this wisely then I must say you are the perfect person for using Credit Cards.

Always use credit card for buying those things which you think is in your budget. I never opt for using a credit card if I need to buy a car or something because I know I wont be able to pay them well.

I always prefer using a credit card with cash back facilities. It will help you to make good amount of extra income that can help you in the bad times. Point-based credit cards are not so useful than cash back credit cards. Actually it all depends on how a person uses the credit card and on what.

Always try to keep the statements of credit cards. It will definitely help you in making a good budget plan later on. I try to change whatever there is on the credit card. It helps me in getting some extra rewards.

Studies have revealed that any normal person will spend more with credit card than without it. It clearly signifies that person has got very poor financial management skills. I have a very good control on my finances and can manage them efficiently.

Few Sacrifices helps you to Save extra Money

If you say that you want to save a lot of money without making any sacrifices then you will never be able to save the money. If you really want to reduce your spending then you have to make few sacrifices of the best things of your life. The best part is that the sacrifices made by you will be an added advantage for you rather having adding anything negative to your life.

My sister always saves $200 from her salary every month to donate for poor people.

The first thing that you have to sacrifice is on your HOME. This is where we spend most of our money. Most of the income from our monthly salary goes into mortgage payments, upkeep of the house and many other petty expenses. But these petty expenses often results into huge some of expenses at the end of the month. Often people likes to stay in big houses because it adds to their status symbol. Staying in a cheaper Geographical area or a house with 3-4 rooms would be more than enough for a family. Focusing on the positive aspects of the life is very important. Staying in a big house and paying huge amount of mortgage payments for that house is not at all a good aspect.

Secondly, try to sacrifice on your CAR. There are some unworthy expenses associated with cars like repairing charges, insurance fees, petrol, diesel, etc. Bigger the car is more will be your expenses. It would be better to use a public transport rather driving a very expensive car. The motive is to reach the desired destination no matter you travel by your own car or public transportation. I really understand that this is not so easy but to get something you have to lose something.

Thats my house, Small and Sweet

Thirdly comes your VICES. It is nothing but a waste. Trust me it is not at all a worth wasting money on poker, gambling or going to strip shows etc. There are many people among us who waste loads of money on buying alcohols and cigarettes knowing they are injurious to our health. First we consume them, waste our money and then when we fall sick again a huge sum of money is spent on doctor fees. I know it is not at all easy to give up these addictions but something is better than nothing.

Fourthly, the Luxuries of your life. In this area already people sacrifice a lot, but still there are many things to work upon. Stop going for dinner everyday, once or twice in a month is more than enough. Restrict yourself from buying branded products, watching a movie at home is a better option than watching it in theaters.

Lastly, the most important of all, your TIME. Its better not to waste our time by doing nothing rather working upon the ways to save extra money. Try to work for few hours on weekend also so that you can earn some extra money out of it. Working as a freelancer from home is a good option. In that way you will be able to spend your time with family as well as you will be able to get hole of some extra income every month.

If you will not respect your time, time will not respect you

Whatever sacrifices I have listed will not be possible in a fraction of a second, it requires a very strong and will power. You need to change a lot of your living styles and habits in order to spend less. If you take these as a mission, then I am sure it is not at all a difficult task to work upon. A little effort is more than enough.

My Personal Thoughts :

1.) I do agree that home is a huge expenses. But buying a good home is a one time chance and so it is advisable to purchase home before the economy gets back to normal.

2.) Car too adds a lot of expenses, but it actually depends on how you maintain your car. Purchasing a new car in 5 years is not a big deal.

3.) Vices are definitely a bad thing. And me being a girl have got no such bad habits though I drink occasionally which is absolutely fine.

4.) I do not enjoy so much of luxuries because i love to save money and donate the same to the poor people. Though I have got a mobile phone, an i-pod, a laptop which are the necessities and not the luxuries.

5.) I always believe in one thing. "If you don't respect TIME, there will be a time when it will not respect you."

Never Spend Your Money Before YOU have it..

Time is more Important than Money

Last weekend after I quit my job, i went to my cousin's place in California and we had a gala time there. In her neighborhood, I met my high school friend Alicia after almost 8 years. We discussed and remembered loads of things that we did in high school. The motive of me writing this post is that I wanted to share with all of you one very important thing that we discussed on Sunday.

Alicia and Me at the age of 7 in California

I told her everything, about my job, my debts, and also about my present conditions since I was very upset with whatever happened. I told her that I have become a professional blogger now. She was looking at my face as if I have used some weird words. She told me she have got no idea about this blogging and all. Then I explained her about my goals of personal blogging. I wanted others to avoid the financial mistakes which I have made in my life.

Alicia and ME in high school, in California

Then I asked her that what was she doing all this while. She told me that she got married as soon as she completed her graduation. She was married to a handsome guy who was in military. She also have two very cute daughters, Marcia and Amanda. She told me that she joined a Corporate Industry as an HR. I was really happy for her. She was earning good salary with the job.

I just looked at a photograph that had Alicia with her smart husband and daughters. I asked her where is her husband. She looked at me and started crying. She replied, "He is no MORE". Tears start rolling down my cheeks. She told me she can still earn a lot but how will she earn happiness in life. Money is not important for me. What is more important is the TIME that I had spent with my family.

Alicia and Me in California on this weekend. I tried my level best to make her feel good. And I guess I was successful

That day I realized that in Life there is something that is more important than money and that is TIME. My financial goals are important to me but nothing is more valuable that the time I spent with my family. I love you mom and dad. You are the most loving thing that has happened to me in this life.

Time is not Money, Time is more Important than Money....

I had to Quit my Job

Yes you have heard it right. I have quit one of my part time jobs yesterday. I have been working part time in a sports club as a supervisor for lawn tennis. Lawn Tennis has always been one of my favorite sports. I was the sports captain too in my high school and since playing lawn tennis was my passion i decided to join the tennis academy here in my neighborhood as a supervisor. I never got an opportunity to play for US so just decided to play at the national level. I had been working there for around 7 years, but circumstances made me quit my job.

I was damn upset that afternoon, but I had no choice but to QUIT my job.

I really enjoyed every part of it. It was so good to meet new people, new students, their parents but from the past couple of months i was not able to manage both my work and tennis together. The tennis session was shifted during the day time, the time when i am completely involved in my work. After I came back home I just checked how much have i earned. Below you will find the details.

Earnings : $ 1200 (approx.)
Anticipated Earnings : $ 500

Therefore, Total Earnings : $ 1700

My Expenditures

household work : $ 200
clothing : $100
eating out : $500

My Total Expenditure: $ 800

Earnings - Expenditure = $ 900 (and $300 for future earnings too)

My left Savings as a Tennis Supervisor and Coach

I was shocked to calculate these figures. I finally realized that I am spending too much on eating out as well as on clothing. So i decided that i will be more frugal now and will eat most of the time at home itself. I also decided that I will work very hard at my official workplace so that I can earn good amount of incentives.

Wednesday, April 29, 2009

Refinance Your Home Mortgage

A very common question is in the minds of homeowners, that is, whether they should refinance their mortgage loans or not? Those who were confused took the minimum affordable mortgage rates that required little or no payment. And now when they know the interest rates are adjusted higher they are running to refinance their home mortgages.

The lenders have become very smart these days. They don't like working with those homeowners who have got a poor credit and are trying to refinance so that their debt gets reduced. As a result of this most of the people got loans knowing that they wont be able to afford it. Lenders very easily trusted those homeowners and lend huge sum of money to them and are now suffering.

We all know that mortgage rates are something which will never be lower. At this point of time it is advisable to refinance loans like student loans, debt consolidation loans, company loans etc. It is very important for the homeowners to decide how long they will be staying in their current home before applying for refinance. Though there are many factors that decide this, the most important is that you have to stay in your home for atleast 10 years to refinance your mortgages.

Make your family feel proud of you by refinancing your home mortgage on time

The two type of home loans, the one with adjustable rate and the other with fixed rate have very good features. The first one have high interest rate on the mortgages and are very cheap in the early stages but as the time pass by they start becoming expensive. Other one, the fixed rate, the interest rate is same of the duration of the loan. These loans are not so risky as the adjustable ones. These loans have got no impact on the changing market conditions.

However, homeowners have got one special benefit and that is they can swift from adjustable rate to the fixed rate at any point of time and vice-versa. I would personally suggest everyone to take help of mortgage calculators while refinancing your mortgages. These calculators will help the homeowners to decide on the various payment methods depending upon the credibility of the homeowners.

Take help from professional Mortgage Advisers only

Take help of mortgage advisers and follow their step at each and every point of making a decision. Always choose the best mortgage broker, they will charge some commission from you but they will provide you the best class of services. As refinancing depends entirely the amount of finances you have, so taking a help from financial advisers is the sound advice too.

Do not forget to check this amazing short video on refinancing home mortgages :

Low Cost Auto Insurance is in demand

Though Car Insurance is very important these days, still you don't need to get ripped off. With some extra work you can actually get an auto insurance at low cost. All you need to do is just spend some time searching over net, shop online, search for multiple rate quotes from companies all over the world. That's it.

We all are aware of the fact that women have access to lower insurance rates then men. Insurance companies are playing very safe these days. They will check your gender, age, driving records and many other things to determine the amount of premium you carry. I don't whether many of you are aware of this or not that auto premium rates reduces a lot with increment of age.

There will be splendid difference in the insurance rate between the person who is 18 and the person who is 25. You might wonder that a person driving a merc have enough money or not, who knows maybe he is enjoying lower auto insurance rates.

So, the best option available for you is to apply for free auto insurance. Do not get fooled if the insurance broker or any company asks for amount of money for insurance premium rates. These days all the information are available free of cost. There are some really great websites like which you can follow to choose the best auto insurance rate for you.

Have a safe driving with safe insurance policy, ALWAYS!!

Always keep one thing in mind and that is get the information on auto insurances from trusted sources only. The best thing you can do is to compare the rates of two different companies and check their consumer satisfaction reports too to be on the safer side.

Monday, April 27, 2009

President's New Reforms on Credit Card Debt Consumers

According to the latest reports by Federal Reserve, the total credit card debt in the United States have reached $963 billions in February, the increase of around 28 percent in December, 2008. Also it was checked by Federal Reserve that the issuers collect a sum of $ 14 billion in a year on the account of penalty fees and 9.8 percent of the credit card industry's revenue.

As per the survey of Federal Reserve women are more responsible than men for credit card debt in United States

It was reported by abcnews that President Barack Obama has decided to bring some changes for the customers when he came to know that one company that provides credit counseling services has enrolled more people in debt management. He also came to know that there are many companies where the amount of customer debt is going on increasing everyday. He called the meeting with many industry executives and decided to bring some new reforms in terms of credit card debt.

On account of this meeting, Obama decided to bring these reforms :

  • interest rates will be doubled
  • clarity and transparency should be increased in card's terms and conditions
  • fees will be added to the consumer's bill
  • All the forms that credit card company issues should be written in simple language
  • No more fine prints and no more usage of confusing terms and conditions.
"Making informed decision is very necessary in the credit card industry", added the president.

Obama conducting meeting with high executives of USA for bringing changes in credit card debt plans

Friday, April 17, 2009

What You Need to know before hiring a Financial Adviser

Suppose you are meeting a Professional Financial Adviser for the first time, What will be your reactions? Obviously you will hesitate to share anything with him because its the only first meeting. But you shouldn't forget that ultimately you are the boss, you are hiring him and not he hiring you. Its up to you what qualities you will look into the Financial Adviser. It is indeed very important to judge the right person because he will be the one taking care of your Investments in future. Below I am listing few questions that would definitely help you in judging the right financial Adviser.

Do not hesitate to ask your to be financial adviser any question you have in mind

How well is your U4?

U4 as we all know is the report card of a financial expert which states us his good as well as bad qualities. It will tell you everything about his background. Basically it is nothing but a card where it will be shown all his misdeeds (if any). The best way to cross check his answers is to login here which will tell you whether your financial adviser is an honest person or not.

How much is your fees?

I am sure you will think that it is quite a shy feeling to ask these questions. But just imagine it is the matter of your hard earned money, so why feel shame in asking. If you buy anything costly from the market, dont you ask the price of the thing before purchasing it? Who knows they can make money later in form of commission, other charges etc. It will also give you a feeling of satisfaction if the total charges of hiring him is known to you in advance.

These were the most common type questions to be asked, now lets move to some in-depth questions.

Whats your job portfolio?

this is important because as I told you earlier it is a matter of your MONEY. If in the portfolio he states that he have only marketing stocks, then i dont think it is valuable to take his advice. It is very important for you to chose the planner who have got strong portfolio.

Do review his Job Portfolio twice or even more than that...

How many times you have changed your Job?

It is very important to know how many jobs the person has switched. If the person has switched around 3-4 jobs in one year then it is very clear that he is not interested in earning client's value he is only interested in making money for himself. It is not at all worth keeping a person like this to plan your money.

How many clients you work with at a time?

If he is handling more than one client at a time, then it is quite clear that he wont be able to manage all the clients together. It might happen that he will try to convince you that he can manage all the clients together. But you are the best judge at the end of the day. Giving him a chance will be a foolishness and nothing else.

How long you plan to work with my Money?

This is a very good question to judge his credibility. If he says, he will manage your money till he helps you in reaching at the highest point of satisfaction, then only he is an eligible financial adviser for you.

Do you have a girlfriend or are you married?

When a financial planner can know everything about your life, then I dont think there is any problem asking him this personal question. There are many people who have a wife or a girlfriend and then they are busy solving their personal problems rather solving your financial problems.

Keep in mind these questions and you will definitely find a right financial adviser for yourself.

So have you met your financial adviser? If so do share what you asked him or her, Is he serving your needs well or not.

Friday, April 10, 2009

Facebook is Growing and so is its Cost

Was raising $240 million from Microsoft more than enough for Facebook or raising $235 million in debt and equity was enough to escape the heat of recession. Jim Breyer, one of the board members from The Facebook said that, "we have enough of capital to provide employment to as many as people we want and we are not at all worried about the profitability of the company".

There is no doubt about the fact that Facebook is growing at a tremendous pace, but with it is growing the costs the company is now willing to go to the IPO's because of the low cash supplies in the market.

Facebook continues to enjoy its increasing popularity worldwide and having the marked growth of 118% visitors wise and around 75% growth in its page views which s a remarkable effort, though its popularity in US is not upto the mark increasing to 41 million from 31 million about 32%. Facebook is likely to spend around $ 1 million per month only on electricity.

The sources in Facebook said that Facebook spends around $ 500,000 per month on bandwith and is expected to buy 50,000 servers worth $ 100 million this year. All that equals to with other expenses comes to around $ 30 million per year plus datacentre and rent payments of $ 15 million that sums upto $ 45 million every year.

And why should we forget the trusted employees of Facebook with around 750 employees working day and night, the payroll is around $ 10 million per month. We can add another $ 100 million on capital expenditures. I wish they can donate some of their money for the war and flood victims.

Mark Zuckerberg : The Creator of Facebook

The question is from where they are able to manage such a huge amount of money? Advertisers which targets the international audience. This is the reason the CFO of the company, Gideon Yu is in Dubai these days in search of some extra fundings for the company.

Still you think Facebook has got plenty of money? Right? NO WRONG !!

Facebook is just praying that economy gets back to the position what it was in the year 2007 or else the company will runaway with the amount of cash very soon. They have grab more and more money as soon as possible because we all know that the economy is more likely to get worse by the end of 2010.

Do not forget to listen the famous Facebook Song

Thursday, April 2, 2009

Are You Eligible for Obama's New Loan Modification Program?

It was good to see that now million of borrowers will get help from Obama's New Loan Modification Program that aims to help them staying in their homes and avoiding foreclosure. Lots of borrowers are still confused that whether this step from the President would help them or not. People are confused that this new refinancing program is for whom? Lots of question still running in their mind. This post is for all those people who are still scratching their head regarding the broad decision made by President Obama.

What is the new Loan Modification Program all about ?

This plan was made keeping in mind two groups of people:

1. People who were unable to qualify for Refinancing though they were able to pay their mortgages on time. This was happening because they owe more on their current home than it was a worth of.

2. People who are at extreme risk level because of high foreclosure.

This new home affordable program plans to allocate around $75 billion for those borrowers so that they can stay in their homes without any added disturbances. The only thing to be kept in mind is that not everybody will qualify for this program. Then Who will Qualify?

1. A person should live in the same house which must be his/her primary residence.
2. Second Mortgages should not be included under this plan at any cost.
3. A person should prove his income.
4. The current house payment should be equal to or more than 31 % of a person's Gross Monthly Income.
5. There should be no charge to apply for free loan modification program.

How to apply for New Loan Modification Program?

The most important thing to do here is to complete the paper work as soon as possible and completing the
required loan modification documents . Secondly, the borrower should prove that he/she is passing by financial crisis, they have to submit their income and expenses details completely.

Which banks are helping with this new Loan Modification Program?

It is good to see that the Federal Government is offering monetary incentives to the lenders because this program is entirely on the voluntary basis. As a result of this most banks will offer this plan to their qualified borrowers.

How will the new Affordable Plan work?

With new interest rate and payment this program will run on 3 months trial period. If the payments are made on time the lenders will automatically convert the plan to permanent modification agreement. After this the plan will continue till 5 years at a very low interest rate and payments.

During this 5 year period homeowners will receive $ 1000 per year which is directly applied with the loan balance. As soon as the 5th year is completed the rate is bound to go up by 1% until it reaches to the maximum point which had been signed in the agreement. It is important for the homeowners to learn about their debt ratio.

What are the important features of new Loan Modification Program?

This new program is not at all similar to loans. The best part is government is paying incentives to the lenders who are participating in this program. Previously no new loan was written that was more than 80%, now with the drop of prices these changes are normal. Many people can easily take advantage of current low mortgage interest rates.

I am ending this post by stating that though I have provided my readers with information regarding qualification of new loan modification program, that doesn't mean that I am favoring or I am against this program. I just believe that it will not help us to come out of the mess in which we are right now. This post is written only to provide general information to you and so that EACH one of you reading this can come with your own conclusions.