Be Cautious When Using Your Nest Egg as an ATM

552

If your home truly is your nest egg, be smart about how use its equity. Make sure that it fits in with your overall financial plan and golas. Otherwise, you could be left without a nest and just the egg!

About five years ago I moved from the ranks of being a renter to that of being a homeowner. Now, not a week goes by that I don’t receive some type of offer through the mail encouraging me to refinance my mortgage, open a home equity line of credit (HELOC), or apply for a home equity loan.

Payoff High Interest Credit Card Debt! Lower Your Monthly Payments! Buy A New Car! Refinance And Get Money Now! scream the slogans splashed across the envelopes.

The promotional letters inside point out how easy it will be for me to “get the extra cash you need NOW!? They promise “no out of pocket costs?with a newly refinanced 30-year loan.

Could I use some extra cash NOW? You bet I could! Who needs high interest credit card debt? Not me, no way, no how! Buy a new car? Hmmm, I like that new Pontiac G6 I’ve seen on tv, maybe in a sleek titanium color with black trim?

For thousands of U.S. households “Home Sweet Home?is rapidly being replaced with a new sentiment – “Home Sweet ATM.? According to the latest Federal Reserve study, 45% of homeowners who have refinanced their mortgages pulled cash out and 74% wound up lengthening their mortgage by about six years. Only 17% shortened their loan term opting to downsize to a 15-year mortgage.

In a period of six years, Americans have more than doubled the amount owed on home equity loans and lines of credit, nearing $766.2 billion, according to the Federal Reserve.

If you’re in your 40’s and you refinance on a new 30-yr. loan, you’ll be in your 70’s by the time your loan ends. Even if you shave off a few years by paying down your principle, you’re still risking not owning your home “free and clear?as you approach retirement age.

What happened to the era when your home was considered your nest egg to be used only for life-threatening or life-changing events like paying for a child’s wedding or for a medical emergency? And worst of all, many new homeowners are using their home’s equity as another source for financing new debts.

Think twice before using home equity to pay off credit card balances. If you’re already overspending on your credit cards now, what makes you think anything will be different after you pay them off with a loan or line of credit? Many people just wind up deeper in debt or facing bankruptcy because they couldn’t resist charging their cards up again.

Keep this in mind before tapping your home’s equity – Your loan or HELOC is secured by your home. Default on the loan and you could lose your house, even if you declare bankruptcy!

The best use for home equity is to make improvements that add value to your home. Remodeling a kitchen or bathroom, adding an extra room or creating a master suite are just a few of the “hot?improvements that can really pay off when it comes time for you to sell.

If your home truly is your nest egg, be smart about how use its equity. Make sure that it fits in with your overall financial plan and golas. Otherwise, you could be left without a nest and just the egg!

Tips To Save Gas-And Money

260

Try these simple fuel-saving tips.

Tips To Save Gas-And Money

Motorists may not need to put the brakes on their lifestyles to save at the pump. Try these simple fuel-saving tips instead.

• Keep the tires of your vehicle properly inflated. The U.S. Department of Energy reports that underinflated tires increase fuel consumption by up to 6 percent and one study estimates that 50 to 80 percent of all tires on the road are underinflated. By these estimates, the U.S. could save up to 2 billion gallons of gas each year simply by properly inflating tires.

• Regularly replace your air filter. A clogged air filter can increase fuel consumption by as much as 10 percent. An added bonus: Air filters keep impurities from damaging the interior of the engine. Replacing them won’t just save you gas. It could save your engine, too.

• Upgrade your motor oil. According to multiple independent university tests, Royal Purple motor oil improves fuel economy by as much as 5 percent and produces notable horsepower and torque improvements. That means motorists could save gas without giving up performance.

• Follow the maintenance recommendations in your vehicle’s owner’s manual. An out-of-tune engine can increase fuel consumption by as much as 15 percent. Always follow your car manufacturer’s suggested tune-up schedule.

• Lighten your load. Don’t carry extra weight in your vehicle. Doing so burns extra gas and could cost you money. Only carry sandbags, tools and other heavy items when you think you’ll be needing them. Also, don’t forget that carrying lots of small, light items can be the same as carrying one heavy item. Be sure to clean your trunk and backseat out regularly.

Here You’re Going To Learn Several Ways To Save Money Every Month By Lowering Your Monthly Bills.

342

Has debt got you down?

If so, you’re not alone. These days getting into debt is easy. Getting out is not. Buying lottery tickets and hoping to “win the big one?is not the answer.

No matter how much money you owe, and no matter how tight money gets, remember that life is too short to spend time worrying.

Therefore, the real “secret” to getting completely out of debt is actually very simple:

Make the commitment, then take action!

If all you do is sit back and …

save money, get out of debt, monthly bills, think positive

Has debt got you down?

If so, you’re not alone. These days getting into debt is easy. Getting out is not. Buying lottery tickets and hoping to “win the big one?is not the answer.

No matter how much money you owe, and no matter how tight money gets, remember that life is too short to spend time worrying.

Therefore, the real “secret” to getting completely out of debt is actually very simple:

Make the commitment, then take action!

If all you do is sit back and talk about getting out of debt, and just complain about how hard it is being stuck in debt – and never actually do anything about it – an amazing thing will happen… NOTHING!

You won’t get out of debt overnight ?after all, you didn’t get into debt overnight, either.

But you can change the way you think. Our mind is very powerful. And when life seems to be out of control, the simplest thing you can control is how you think!

There’s an old saying:

“The definition of insanity is doing the same things over and over again, but expecting different results!?
That’s especially true when it comes to getting out of debt!

You need to start with small steps. Take out a notebook and write down your goals. Write down the small steps you will take to reach your goals.

?Cut out unnecessary expenses
?Think of inexpensive ways to have fun
?Consider selling valuable items you don’t need
?Get a part-time job
?Start an online business

Think hard, write down everything you think of, then decide which steps to take first. And most importantly, go ahead and do them.

Nobody every got rich by sitting on the couch and thinking!

Without making the commitment to getting out of debt, you never will.

On the other hand, you CAN live the life you’ve always wanted. And if you make the commitment – and don’t let ANYONE or ANYTHING get in your way – you, too, can live a life without debt!

Residual Income Can Be Your Key To Wealth

902

Are you standing at the door to wealth but can’t seem to find the right key?

There are many keys on the key ring that can unlock the door to wealth, but you have to know which ones they are and how to use them correctly.

In this article I’ll focus on the “residual income” key that many have discovered can be used to enter the inner sanctums of the wealthy.

But before I go too far, I should probably define what I mean by “residual income,” (also called passive or recu…

residual income, passive income, recurring income, residual income opportunities

Are you standing at the door to wealth but can’t seem to find the right key?

There are many keys on the key ring that can unlock the door to wealth, but you have to know which ones they are and how to use them correctly.

In this article I’ll focus on the “residual income” key that many have discovered can be used to enter the inner sanctums of the wealthy.

But before I go too far, I should probably define what I mean by “residual income,” (also called passive or recurring income).

While there are perhaps a number of definitions for “residual income,” I will be using the term here as follows:

“Residual income is income that continues to be earned after the initial effort has come to an end.” In other words, it can be thought of as the process of making a sale one time but getting paid over and over again.

How can this be? That is, how can you make one sale and get paid over and over again? Well, let’s take a look at some common examples of residual income.

An insurance policy. When you buy an insurance policy, you normally pay premiums monthly, quarterly or annually. You made one purchase, but you continue to pay as long as you maintain you policy. The insurance company earns a residual income from you.

A service subscription such as a pest control, lawn maintenance, or web hosting contract. When you purchase a pest control, lawn maintenance, or web hosting service you normally again pay a monthly, quarterly, or annual fee. As long as you continue your service, you continue to pay the fee. The service company earns a residual income from you.

A membership subscription such as to a membership Website or a club. To continue your membership, you much continue to pay membership fees. The membership entity earns a residual income from you.

In all of the above examples, the sale was made only one time, but you continue to pay the company over and over again.

Residual income is distinguished from “linear income,” where a single payment for a single one time purchase is made. For example, if you have an hourly job, you are exchanging one hour of your labor time for an hourly pay rate. You must work each hour to get paid. If you stop working, you stop getting paid. Your income is linear.

However, if you sell memberships to a Website and your members pay a monthly fee to belong, then you continue to collect their monthly fees as long as they continue to remain a member. You made the sale one time but continue to collect an income long after the initial sales effort was completed. This is an example of “residual income.”

Which would you rather have, a residual income or a linear income?

Generally, whenever possible, you should try to earn a residual income that will continue to grow over time as you make individual sales. If you put in a consistent effort toward earning a residual income, you will find that your income will compound itself as the amount of residual income continues to grow.

For example, let’s take a look at the difference between selling a $29. ebook and a membership to a Website with a $29 monthly fee. We’ll assume that both sellers began their sales effort on 1 January and continued the effort for six months.

With the sale of each ebook, the seller earns $29 but then has to make another sale to earn another $29. Hopefully, the seller has some backend or follow on products to sell to each customer in the future, but many do not. So each sale stands alone. Let’s also assume that the cost to make each sale (including Web hosting fees, merchant card fees, advertising, etc) come to $4 per sale. Our merchant thus earns $25 net per sale. We’ll assume that 10 sales are made per month so over the six month period he made 60 sales. So for 60 sales, he has earned $1,500.

Now, let’s take a look at how the membership site might do.

Each membership sells for $29 per month and the cost to make each sale is the same $4 per sale so the site owner earns the same $25 net per initial sale. However, he continues to earn the $29 each and every month that the buyer remains as a member and there is no sales cost for the subsequent months. We’ll also assume that our membership site makes 10 sales per month and that each buyer remains a member for 4 months on average before dropping their membership. Now lets take a look at the numbers.

Month 1 = 10 sales for $250
Month 2 = 10 sales for $250 plus $290 residual income
Month 3 = 10 sales for $250 plus $580 residual income
Month 4 = 10 sales for $250 plus $870 residual income
Month 5 = 10 sales for $250 plus $870 residual income
Month 6 = 10 sales for $250 plus $870 residual income

The total income for the six months comes to $4,980 plus there is still a continuing income that will come in from sales that were made during months 4, 5 and 6.

Which would you rather have, the $1,500 made as linear income or the $4,980 plus earned through sales with a residual income tail? The sales effort was the same.

As you can see from the above example, residual income can quickly surpass linear income if your sales effort remains constant. So, keep on the lookout for good residual income opportunities, they can be your key to opening the door to increased wealth.

Personal Finance. Student Loans Debts Do Not Go On Your Credit Record.

591

Every time you apply for credit, for example a credit card or a loan, the lender will request to see your credit history from a credit reference agency. The information they hold is so detailed that there’s really no need for us to fill out that long application form, because within a fraction of a second they can see all they need to know from Experian, Equifax or Callcredit, the three main credit reference agencies. You would be very surprised to see just how much they know…

student,personal,finance

Every time you apply for credit, for example a credit card or a loan, the lender will request to see your credit history from a credit reference agency. The information they hold is so detailed that there’s really no need for us to fill out that long application form, because within a fraction of a second they can see all they need to know from Experian, Equifax or Callcredit, the three main credit reference agencies. You would be very surprised to see just how much they know about you.

Banks, building societies and other financial institutions providing credit have been passing on details of your financial transactions to the credit agencies. Every time you apply for a credit card, every time you miss a mortgage repayment ?it gets noted. They know whether you pay the minimum or the balance each month, they even know details of your credit limit on each credit card. They also look to public records, the voters’ roll and the public register of court actions because that is where all county court judgements are listed. It all happens automatically, and when your credit history is requested, the computer will provide a statistical analysis of your financial habits and provide an assessment of your suitability. It enables, the industry argues, lenders to make an accurate judgement about whether they should lend you money or not.

However, there is one piece of financial information that the credit agencies are not allowed to access, and that’s the student loans. Despite the industry’s remonstrations to the government, nothing has changed, and they are not allowed to access the information. The reason? Student loans constitute a debt to the taxpayer, they were not funded by commercial business.

Before September 1998, the student loan system worked like this: once graduates were working and earning the national average, which was ?5,000 at the time, they had to repay their loan on a monthly basis by direct debit. 59,000 of those pre-1998 graduates still haven’t started repaying their loan, and each has on average a debt of ?,750.

In September 1998, the student loan system changed, and the system remains the same to this day. Now, repayments are taken directly at source, straight from the salary in the same way as national insurance and income tax. This method has been a lot more successful.

The lending industry is not happy about the student loan situation, their main argument being that they need to know, when considering an application for credit, if the applicant has extra financial responsibilities. The introduction of top-up fees resulted in increasingly large student debts, and as the post-1998 loans have to be paid off at a rate of 9% of the graduate’s income once it has reached ?5,000, it is a large portion of income to lose.

The Association Consumer Credit Counselling Service made the following statement: “Knowing whether a young person has a student loan and whether it is being paid back, is useful.?So they are in agreement with the lenders.

The Citizens Advice Bureau is also keen to have the information made public, because they feel that graduates could be taking on too much debt, and if lenders could see their student loans, they would ensure that graduates are not given the ability to borrow beyond their means.

However, the Department for Education and Skills is showing no signs of wavering on its decision to keep individuals’ debts to the Student Loan Company private.

For the foreseeable future ?the situation will remain the same and student loans information will be inaccessible to the credit industry.

Steps To Get Your Financial House In Order

344

Managing your finances may be easier than you think. That’s because online banking offers the same services found at bricks-and-mortar institutions–plus many others.

Steps To Get Your Financial House In Order

Managing your finances may be easier than you think. That’s because online banking offers the same services found at bricks-and-mortar institutions-plus many others.

For example, through online banking, customers can check their account balances, transfer funds, pay bills and more. And because of the convenience, online banking can make it easier to get your finances in order. Here’s how:

• Eliminate clutter and help save the environment-Pay (and receive) your bills online and you can get rid of unnecessary paper, envelopes and stamps. You can also view images of your paid checks and account statements online.

• Simplify your Web life- Instead of bouncing from site to site to view and pay your bills, you can do it all through your bank’s Web site-and save yourself the trouble of multiple log-ins and passwords while you’re at it.

• Easily monitor your accounts-You can choose to receive e-mail alerts when checks are paid, deposits clear, bills are due, your account reaches a certain limit and more. Alerts also help you stay on top of recent account activity so you can detect and prevent fraud.

• Reduce your chances of fraud-A study released in January 2006 by Javelin Strategy & Research shows that Internet-related fraud incidences are less severe, less costly, and less prevalent than theft detected offline due to online account monitoring.

• Manage your investments-Invest and build your portfolio using helpful tools and resources online. You can also watch your retirement savings grow and decide how to invest your money.

Some banking sites take customer service even further-even if you’re not a customer. That’s because these sites serve as valuable “at your fingertips” resources for everything from current interest rates to protecting your accounts to retirement tips.

One Web site, wellsfargo.com, offers an added benefit for its customers called My Spending Report. This expense management tool gives customers a “big picture” view of their spending, combining payments and purchases from credit cards, check cards, checking accounts and online bill payments in one convenient place. My Spending Report automatically organizes these expenses into 19 categories, including gas, groceries, health care and entertainment.

Talk For Less

437

Are you annoyed at how large your monthly mobile phone bills are? Are you looking into ways in which you can lower your quarterly landline telephone charges? Is the amount you are paying for your gas and electricity increasing to an unaffordable level? In this article I describe about the ways in which you can go about lowering these charges. I hope you find this article interesting and of benefit to you.

phone, telephone, electricity, gas, mobile, bills, provider, service, friends, family, company

Are you annoyed at how large your monthly mobile phone bills are? Are you looking into ways in which you can lower your quarterly landline telephone charges? Is the amount you are paying for your gas and electricity increasing to an unaffordable level? In this article I describe about the ways in which you can go about lowering these charges. I hope you find this article interesting and of benefit to you.

I am sure that many of you have been stopped in the street before by one of the large band of people who ask if we would like to switch service providers for our telephone, electricity or gas. You may have had people knocking at your door or even making a cold call via the phone, asking you a similar question. These people are often seen as a hinderence and a bit in your face. I must admit I see them in this light as well.

There are however some very good companies out there which provide a superb service without resorting to these annoying tactics. A simple search on the internet for key phrases such as lower telephone bills or talk for less, can often lead you in the direction of these particular companies.

Many of my friends and family have done this and have told me how happy they are with their new but largely unknown provider. I am myself in the process of finding a new company to switch to, as the days when one large firm has a monopoly on these services is over.

You may think to switch is one big hassle, that you will need to change your phone number for example. This could not be further from the truth as in most cases you are able to keep your original number and to change provider is quite a simple procedure.

You may also think that the service that the new provider offers may not be as good as what you currently are getting. From what my friends and family who have already switched have told me, the service they have had thus far has been nothing short of superb.

Some of the companies also offer the benefit of having all of the electricity, gas and telephone charges on the same bill. This can be of use to people when trying to budget for every month.

There is a lot of competition out there today and there are some great savings to be made. It is just a matter of going out there, making a few calls, sending a few e-mails, and making a few searches on the internet.

Take Control of Gas Prices

329

Does your money seem to evaporate with every trip to the gas station? You can add miles to every gallon you pump simply by maintaining your vehicle and practicing fuel-saving driving habits.

Take Control of Rising Gas Prices

Does your money seem to evaporate with every trip to the gas station? You can add miles to every gallon you pump simply by maintaining your vehicle and practicing fuel-saving driving habits.

“Most motorists don’t realize that it’s the little things that don’t take a lot of time or cost much that can really make a difference when it comes to saving money at the pump,” said Rich White, executive director of the Car Care Council. “Loose or missing gas caps, underinflated tires, worn spark plugs and dirty air filters all contribute to poor fuel economy.”

The Car Care Council offers these gas-saving maintenance and driving tips.

* Secure your vehicle’s gas cap. About 17 percent of the vehicles on the road have damaged or loose gas caps or are missing gas caps altogether, causing 147 million gallons of gas to vaporize every year.

* Keep tires properly inflated. Driving on underinflated tires is like driving with the parking brake on and can cost you a mile or two per gallon.

* Replace worn spark plugs regularly. A vehicle’s spark plugs can fire as many as 3 million times every 1,000 miles. A dirty spark plug causes misfiring, which wastes fuel.

* Change dirty air filters. If the air filter gets clogged and chokes off the air, it creates a mixture that’s too “rich” in gas, which causes the engine to lose power. Replacing a clogged air filter can improve gas mileage by as much as 10 percent.

* Don’t be an aggressive driver. Aggressive driving can lower gas mileage by as much as 33 percent on the highway and 5 percent on city streets.

* Avoid excessive idling. Sitting idle gets zero miles per gallon. Letting the vehicle warm up for just one to two minutes is sufficient.

* Observe the speed limit. Gas mileage decreases rapidly at speeds above 60 mph. Use cruise control to maintain a constant speed on the highway.

* Do not carry unneeded heavy items in the vehicle. An extra 100 pounds can cut fuel efficiency by 1 percent to 2 percent.