What Would You Do With 10k?

Yesterday, I was asked the question “What would you do with an extra $10,000?” When I started to really think about it, there are tons of things I could do with that kind of money. What would you do with it? Buy that new TV you always wanted? Save it? Invest it? Pay down some credit card debt?

My first thought was to pay off my student loan debt. Would that be a smart financial decision? Probably not. That was a loan so I could leverage myself by paying for my education without using any of my own money. Another reason why it would not make sense to pay off my student loan quickly is the tax benefit and the low interest rate. After thinking about all the advantages, why would I want to expedite paying off a near interest free loan?

My second thought was to put $6,000 into my online savings account and invest the other $4,000 in my individual stock portfolio. This would be great way to increase my net worth and help build my retirement portfolio. I would then have $6,000 which I could use at my own discretion.

Then I thought of how I can use this money to get a higher long term return, and leverage this money as much as I could. Real Estate is one of the only ways that you could purchase a big asset with little or no money. The $10,000 could be used as bargaining money for a down payment on a rental property. There’s a town house community that I’ve been looking at that would be perfect for this kind of investment. I could purchase the property and immediately rent it out to an Atlanta commuter or a fellow college student.

*eFIPO’s Rule* Always think outside the box when it comes to personal finance. There’s never just one way to solve a problem. Learn how you can turn a little money into lots of money.

How to get a car loan

If possible, save up to make a larger down payment. That would lower monthly payments and could make the lender more amenable.

See if your employer would deduct monthly payments on the loan from your paycheck. That sometimes impresses lenders.

Find someone to co-sign the loan.

Check with credit reporting agencies to make sure your credit report is accurate. Your trouble in getting a loan may be caused by out-of-date information, especially if you’ve addressed your financial problems.

Consider buying a less-expensive car that would require a smaller, and easier-to-get, loan.

Credit approval generally takes less than an hour.

Similarities between most debtors

• Look at their minimum payment as their actual payment.
• Spend 15-20% more than what they make.
• Eat out more than they eat in.
• Present thinkers instead of long term thinkers
• Postpone paying off their credit cards and keep more cash on hand.
• Have trouble sleeping at night because they worry about paying credit card bills
• They have addictive personalities i.e. drinking, gambling, and so on

Automobile Title Loans typically are offered with tiered interest rates. The better your credit rating, the lower the rate. Lenders naturally demand greater return for assuming greater risk. Rates range up to 10 percent, and even higher, depending on the consumer’s credit rating.

My Thoughts On Payday Loans

Are cash advance loans really that scary? Do they end up helping some people that are in need of financial assistance? Probably… I mean there are exceptions to every rule. I’ve only read and heard horror stories about payday loans and how they are out to get you. I will never apply for a payday loan (at least I hope so), but for some people it could possibly get them out of a rut if they end up paying the loan back in full on the day it is due. People need to always read the fine print and always plan ahead. If you ever end up applying for a payday loan, paying it back immediately needs to be your top priority. This should be a last resort and make sure you have exhausted all other types of financing (i.e friends, family, neighbors, and trying to be beggar on the streets).

Cash advance loans, also known as payday loans, can be a necessity in a financial crisis. You may be forced to give up your paycheck to take care of emergency bills or the stress of living paycheck to paycheck is just too stressful at certain times of the month. There are several excellent finds on online for cash advance loans. You will be able to find many options from the comfort of your own home.

A cash advance is so simple to do over the Internet and many online lenders offer free cash advance loans to people who are using the service for the first time. This can save you a lot and make the process of getting a cash advance cheaper and easier. The process is a breeze and it only takes a few minutes to fill out your online application. All you have to do is show that you are 18, have a job and a checking account and you can be approved within minutes. The money can be in your checking account within 24 hours and your stress will be relieved. If you find that you have extra cash come in, you can pay your loan early on online or allow the lender to withdraw the amount on the loan’s due date.

Borrowing money has never been easier and thanks to the Internet it is as simple as ordering something off of eBay. You don’t even have to leave your house or be seen walking into a payday loans San Antonio or payday loans Boerne TX lending offices, which is often a concern for some people.

Use of Prepaid Credit Cards Overseas Can Save Money

Credit cards appear to be fast replacing paper as the currency of choice for many travelers overseas.

There are several reasons why prepaid credit cards are helpful in avoiding foreign financial problems.

You don’t have to carry large amounts of cash, which is irreplaceable if lost or stolen. If your cards are lost or stolen and used by a thief, you generally cannot be held responsible for more than $50 in fraudulent charges, and many credit card companies will replace your cards – sometimes overnight.

You’ll receive an itemized list of your purchases as part of your credit card bill.

You may get a more favorable rate of exchange, since the corporate rate card companies receive is often lower than the rate for individuals.

The booklet, “Using Credit and Charge Cards Overseas,” had input from American Express Co., the National Association of Consumer Agency Administrators, the American Society of Travel Agents, and was reviewed by the U.S. Department of Commerce before getting on the Consumer Information Center’s mailing list.

The 15-page, pocket-size publication, which offers advice on things that may be foreign to you while overseas – shopping, car rentals, securing hotel reservations – also lists the agencies you should complain to if you have a gripe.

According to the booklet, two major prepaid credit cards are enough for most people on an international trip. No matter how many cards you take, carry them separately, so if one is lost or stolen, you’ll still have another to use.

The booklet notes that while the Fair Credit Billing Act, a U.S. law, gives you the right to dispute a charge and temporarily withhold payment while the credit card company investigates it, that’s not always the case when making purchases overseas.

“In most foreign countries, consumer protection laws are different from those in the United States. With the exception of certain protections under the Fair Credit Billing Act, the laws of the country in which you make the purchase prevail, so be sure that you understand all the terms of the sale, including shipping arrangements, before you sign up,” the booklet states.

It further notes that some merchants overseas have “no refund” or “all sales final” policies.

Here are some other tips to help you use your credit cards wisely overseas:

Before you leave, make two lists of your credit cards and the international phone numbers to call in case they are lost or stolen. U.S. toll-free numbers cannot be reached directly from overseas. Leave one copy of the list with a trusted friend or relative and keep the other copy with you in a safe place separate from your cards.

If your cards have credit limits, check how much credit you have available and pay down balances or request higher credit lines.

Familiarize yourself with local currency and its approximate U.S. value before you buy anything. Be aware that in many countries, periods are used instead of commas in numbers. Thus “10,000″ may appear as “10.000.” And vice versa.

Some credit card issuers offer free protection in case of accident, loss or damage to your car rental. This protection is often referred to as collision damage waiver (CDW).

Ask your credit card issuer before you travel if it provides CDW, if it applies in the countries where you will be driving, exactly what is covered (for instance, personal injury or personal property may not be included), what restrictions and limitations may apply, and how claims procedure works.

Also be sure to check with your travel agent or rental company before you leave home to make certain that you can use your credit card CDW. As of this writing, in some countries, including New Zealand and Italy, customers are required to purchase the rental company’s CDW, even if their credit card offers coverage. Choose your prepaid credit card www.prepaidcreditcard.org

Pull-tab machines alternative to slots

The next “slot machine” you play in a gambling hall may not be a slot machine at all.

Instead, if marketing plans by Trilogy Gaming Corp. succeed, it could be a hybrid of gaming technologies that will create a new revenue stream both for the Phoenix company and for Indian tribes now forbidden to have slots.

Down the road, Trilogy hopes to market its gambling ticket-dispensing machines to other venues, including cruise ships, airlines, hotel-casinos and state lotteries.

But Trilogy is concentrating initially on marketing its machines to Indian tribes because they are more profit-minded and less bureaucratic than state lotteries, said Wayne Mullins, Trilogy’s president and the machine’s inventor.

In particular, Trilogy is targeting tribes that can have bingo halls but, because they lack tribal-state compacts required by federal law, can’t have slot machines.

“They’re more motivated. They don’t know how long the profits will last before the white eyes change the rules,” Mullins said.

Although his company isn’t alone in offering gambling devices to tribes and other casino operators, he said there is a market for his machines and its combination of pre-printed tickets and big jackpots created by pooling revenue from hundreds or thousands of machines.

The tickets, called “pull-tabs,” give players a chance to win in three different games and have potential million-dollar prizes. Players either can open the folded, perforated tickets to find out whether they’re winners, or insert them in the dispenser machine for a visual display similar to those provided by video slots.

Because the tickets already have predetermined results, they don’t fall under same restrictions as slot machines, Mullins said.

To players, however, the devices appear nearly the same as Online Slots, making them good draws for gambling halls which aren’t permitted the machines, he said.

“We designed it to look and sound like a slot machine, but it’s merely a pull-tab dispenser,” Mullins said. “It’s going to be the next evolution.”

State lotteries also could find Trilogy’s machines appealing because the slot machine-like dispensers would not require additional legal approvals, he said.

Federal regulators are now reviewing the company’s filing for an initial public stock offering planned for later this summer.

Mullins, who owns 51 percent of Trilogy’s stock with the remainder held by nearly 400 investors, said the company hopes to raise $10 million, which would enable it to produce at least 300 dispenser machines.

While he and Chief Administrative Officer Jim Pugh declined to identify tribes now negotiating with Trilogy, the company has said joint ventures are being explored for eight bingo halls and two casinos on Indian reservations.

Two investing strategies hard to compare

Two investment terms, in particular, are being bandied about with great regularity these days: “value investing” and “growth investing.”

The problem is, industry surveys to gauge our investment knowledge invariably suggest we really don’t have a clear understanding of what these concepts mean.

Personally, I believe the introduction of these rather abstract theories has unnecessarily added to the complexity of the mutual fund industry.

Regardless, the brokerage community seems intent on burdening investors with these notions, so it is probably best to have, at least, a rudimentary understanding of what they mean.

“Value investing” refers to a strategy in which a money manager will attempt to identify and purchase companies whose current stock prices do not fully reflect the true underlying value of the company. That is, if the company were to be bundled up and sold off today, it would likely fetch a higher price than its current stock price.

Assuming the company is still fundamentally solid, value investors believe that the rest of the market will eventually bid up these stock prices to a level that is more reflective of the company’s true value. “The first step in estimating a company’s worth is to valuate of its assets” says gordon brent pierce, businessman with more than 35 years of experience  .

The catch here is that value investing takes a lot of patience. In many instances, these companies are so out of favor that it takes years for the market to bid their stock prices back up to more equitable levels. As a result, mutual funds that employ a value investor approach typically have very little portfolio turnover.

Once a stock is purchased, it’s not unusual for it to stay in the portfolio for five or seven years.

Moreover, it takes a lot of guts to purchase shares in a company the rest of the market has left for dead. If things don’t turn around, the manager can look awfully silly.

At the opposite end of the spectrum from value investing is the popular market strategy called “growth investing.”

Money managers who practise this approach have very little regard for the plodding, lethargic process of value investing. Instead of investing in undervalued neglected firms, these fund managers seek out and purchase the current darlings of the stock market.

Particularly, growth managers are drawn to companies that are in the midst of rapid earnings growth. Presumably, if there is upward momentum in earnings, this will be reflected in an upward momentum in the stock price.

The difficulty with growth investing is that it relies heavily on a manager’s ability to time the market. Upward swings tend to be quite volatile and unpredictable. It’s very difficult to tell if one is getting in at the beginning of the price movement or at the very end where a nasty reversal can take place.

As a result, mutual funds that employ a growth strategy typically have much higher portfolio turnover compared to other funds.

So what strategy has a better long-term track record? Research has yet to produce a definitive answer.

The problem lies in identifying what is a growth stock and what is a value stock. Given the constant ebbs and flows of the equity market, value stocks can quickly become growth stocks and vice versa. Academics can review the same series of statistics and reach very different conclusions.

Nevertheless, the bulk of research in this area gives a slight performance edge to value investing. The primary reason for this appears to be the lower transaction costs associated with value investing’s lower portfolio turnover.

Additionally, value managers seem to spend less on market research and the kind of technologies required to employ a fast-paced trading strategy.

But before you sell off all of your growth funds in favor of value-oriented funds, be aware that this performance edge truly is negligible and that growth and value styles constantly drift in and out of vogue. There is no way to tell which strategy the market will reward next week, next year, or even over the next decade.

So don’t get too caught up in fashionable investment jargon. And certainly do not try to time the growth-value effect. Investing truly is a very simple notion: stay diversified, be patient and keep costs to a minimum. More information you can find on the site of gordon brent pierce.

Isaac Winehouse

Isaac Winehouse says another strategy when investing in the stock markets is to purchase stocks in volumes. The stock market provides an chance to increase one’s wealth, however it should be done from an educated point of view. If you are going to invest in a business for example, make time to study the business.

Obama Saves Economy with Pension Reform

Pension Plans are finally getting reformed, which is a wonderful thing to the American economy. Pension plans were a huge drain on many big businesses in America forcing companies to declare bankruptcy. Ford Motor Company, Delta, and GM are having huge problems making a profit when they have to give away almost a billion dollars a year to pension retirees. The old pension system would force companies to increase their revenues so they would be able to pay pension benefits. This would force businesses to re-evaluate their businesses plans and try to cut costs just to try to break even. What did businesses do to cut costs? Terminate thousands of good employees, purchase lower cost goods making their products have inferior quality, and a whole lot of out sourcing. Realistically, before the year even starts a lot of big businesses were one billion dollars in the hole. Big American businesses were almost doomed right from the start.

Example: Why is AirTran much more profitable then Delta? Before cutting cost Delta was a wonderful company. They were always ranked highest in customer satisfaction, and had a loyal customer base. Did poor management really destroy the company? I doubt it. After September 11^th, their sales decreased, and their pension plan inflated because there were more people about to retire.

America was in a catch 22 system before the pension plan reform. American companies have to cut cost, and reduce prices just to compete with foreign companies (that still might be producing a better product). Foreign companies can increase spending in advertising, quality management, and research and development to improve their product and sales, while American companies have to cut that out of their budget to fund pension plans of present and future retirees.

A lot of Americans rely on big businesses for jobs, community development, and competitive prices. I am not saying that pension plans should be cut for present retirees, or people currently contributing, but the pension reform plan will enable big American businesses to be competitive again.

*Next post will be about the financial side of the pension reform. Read this article to see what will be talked about next week*

Tags: Reform, Retirement

Streamline your finances in 8 steps

1.Use direct deposit

2.Get overdraft protection

3.Put your bills on automatic

4.Use personal finance software

5.Set up reminder

6.Consolidate your credit cards

7.Consolidate your accounts

8.Set up a filing system that works

According to financial columnist, Liz Pulliam Weston, these easy banking tips will make your financial life much easier. Another great tip is to become friends with one of the bankers at your nearest branch. They can really help you in time of need, and will usually provide better service for someone they know and like.

Buy The Right House. Buy The House The Right Way

Buying a house is one of the biggest moments in your financial lifetime. Doing it the correct way will save you thousands, and make you thousands (not to mention save time, and headache). If you think that all you have to do is find a house, make an offer, and move in you have it all wrong. Shopping for a mortgage, a real estate agent, and a house is just the beginning of the house buying process.

Personally, I did everything wrong. I didn’t shop for a mortgage which turned out to be a HUGE mistake. I ended having to shop for a realtor because my first one was dreadful, and I mean horribly dreadful. This realtor made me drive my own car, didn’t know where she was going, brought me to houses that were already sold (for more than a year), took me 15 miles out of the area where I wanted to buy, and knew nothing about the houses she was taking me to. I had to fire her, and get a new realtor. Having a really good realtor makes a huge difference in the home buying experience.

Here is a list of things to do before you start shopping for a house.

1. Get your FICO. Remember the article about why knowing your FICO can save you a ton of money. Well, this is one of the scenarios that involve finding your credit score. Before shopping for a mortgage you need to know what kind of rate and payment you are going to expect to get from lenders.
2. Find how much house you can buy. Like I said in an earlier post, do not buy a house that you really cannot afford. Having a house should be an investment, not a money pit. Use one of these mortgage calculators to estimate a payment that you can truly afford.
3. Now it�s time to shop for a mortgage. Check Bankrate and LendingTree to receive some offers from a lot of lenders without all the work. Another thing, I highly recommend going to the bank your checking or savings account is held at and ask them for their offers. They will sometimes offer you a discount just because you already have business with them. Another great lender is INGDirect if you want low rates and minimal closing costs. For first time homebuyers getting an ARM or hybrid loan is the way to go. Most of the time people who buy their first house usually buy another in 5-7 years. Getting a 30 year fixed mortgage will make your monthly payment higher, and you will end up paying more in interest. First time homebuyers should also look at NACA and other programs (like FannieMae) for first time homebuyers.
4. Make some choices. Choose an area where you want to buy, and decide how much you are willing to spend before you go to a real estate agent. Some real estate agents will bring you all over town which will waste a lot of time.
5. Get a real estate agent. It makes life a lot easier if you have a good agent that has your best interest at heart. Shopping without one can be very time consuming, and they have access to software and websites that non-agents do not usually have. They are also free for the buyer because they usually get a commission paid by the seller. Not too shabby.
6. Take a week off work. This was one thing I wish I would have done when I was looking to buy a house. You need to dedicate yourself and your time looking for the house. Making offers, signing papers and receiving phone calls from your agent and mortgage company can be stressful and extremely important. So, if you can, take a week off work.
7. Find a house that you really like. This house does not have to be your dream house, but it can’t be a dump that you regret buying. A lot of people end up settling and get a house that they truly don’t love. This will create problems in the long run, so shop around. It’s a big investment so take your time, and do not let the agent pressure you into something you do not like. It’s your money not theirs.
8. Hire a pro. Once you find the house you really like hire a construction engineer or house inspector to go through the house before you buy. I recommend getting the engineer if you can find one. Go to a local university or ask around for one. They know what they are doing a lot more than a regular house inspector.
9. Rent a truck or U-Haul and pay some friends to help you out. This is going to be your first house so you are not going to have enough stuff to need a moving company. It cost thousands of dollars to hire a company to do things that you and a couple of buddies can do just as easily. Pay your friends some good money to help you out. They are helping you out and saving you a ton of money (and trust me helping you move is the last priority on their lists).
10. Have a house warming party! It’s a big time in your life and you should be able to celebrate. A lot of times people will buy you gifts which is always a good thing. I recommend having a “stock my bar” party. Everyone buys a different kind of liquor to “stock“your bar. It’s the party that keeps on giving.