By Alex Summers

Your credit score is one of the most important numbers in your financial life. No matter what you think about credit and debt, there’s no shaking the fact that a lot of companies use your credit score to make decisions about you. Everyone knows that banks and credit card companies use your score to decide whether or not to extend credit. A good score means favorable rates and access to the best credit cards. A bad score means high down payments, higher rates, and limited access, if any, to credit cards that aren’t as good. What you might not know is that landlords, cell phone companies, and utility companies also use your score to make decisions. Landlords decide who to rent to based on credit scores because it’s a sign of your risk. Cell phone companies, who give out free phones for long term contracts, want to make sure you meet your obligations and continue paying during that contract. Having a good score is more important than you might have expected.

So how do you improve it? Quite simple.

First, stop applying for credit cards. When you apply for a new credit card, that company pulls your credit history using a hard inquiry. A hard inquiry will knock your score down a few points for every inquiry. That latest credit card with the awesome cash back offer? Ding, that’s points off. The fewer inquiries you have, the better.

Make sure your credit reports are accurate. Credit reports are full of errors, so take advantage of the Fair Credit Reporting Act and review your three credit reports (Experian, Equifax, TransUnion) every year to make sure there are no errors. If you do find one, dispute it immediately because it can take some time to fix.

Make sure you pay your bills on time. Missing payments or making late payments hurt more than almost anything else (other than significant events like bankruptcy and default on a loan), so make sure you put a system in place so you never miss a payment. That system can save your butt and your credit score if it prevents even one missed payment.

Don’t cancel cards. One large component of your credit score is credit history and the age of accounts. When you close a credit card, you’re potentially lowering the average age. Another large component is credit utilization, which is the percentage of credit you are currently using. Close a card and that number goes up. If you don’t like a card, just stick it in a desk drawer for now.

You might be asking yourself, what is a good credit score? According to Fair Isaac, anything over 760 qualifies you for the lowest mortgage rates. If you have a score above 700, you’re still in great shape. As you get lower, the rates you would be expected to pay will increase. So if you have a score above 700, I wouldn’t worry too much about it.

Your score is important but don’t let it be all consuming!

About the Author:

Alex is a soon to be MBA graduate who is getting his financial ducks in a row after the money management disaster that is the college experience.

What is a Credit Utilization Ratio?

By Alex Summers

When it comes to children and money, the traditional perspective is that kids need to be taught how to save. Parents will give their son or daughter a piggy bank, hand them a quarter once a week, and then instruct their child to save those quarters until the bank becomes full and stuffed. At that point the money can be spent however the child chooses, but this is not the emphasis of the exercise. The main point is that the youngster learns to save.

Saving money is certainly a valuable and worthwhile life lesson.  But any adult who, for example regularly checks their Discover Bank online banking account or needs to prepare for retirement, knows the importance of frugality and patience when it comes to money. But money was created to be spent, not merely to be saved. Furthermore,  the Bible instructs us to be good stewards which includes not only saving but also spending and  giving i.e.  charity. So saving is important, but so are spending and giving – two financial skills that children also need to be taught. If a child knows how to save, spend, and give in the correct manner, he is not only responsible and poised for adulthood, but he also is well on his way towards being a charitable human being.

So how can we make our children better spenders and givers? Here are a few tips:

To make your kids better spenders, give them budgets and let them make decisions in everyday life.

-At the grocery store, give them a set amount of money, a required nutritional content, and let them pick out food.

-When shopping for Christmas presents, give older children a budget from which they can choose the combination of expense and quantity that they desire from their gifts.

-To let your children work with money that is still real but less tangible, give them an allotment of family airline miles and let them decide a vacation destination.

To make your kids better givers, encourage them to contribute to charitable causes.

-Have them select one Christmas present to donate to charity.

-Let them research and decide where a financial contribution goes.

-Encourage them to sort out old clothes and bring them to Goodwill or the Salvation Army.

With the right attitude and approach, we can hopefully all raise children that are equally good savers, spenders, and givers. By letting them make some decisions in these regards, they can further gain greater responsibility in all facets of life as they move forward.

About the Author:

Alex is a soon to be MBA graduate who is getting his financial ducks in a row after the money management disaster that is the college experience.

Teach Kids About Money

The Good Old Days are Gone

Years ago when a person hired into a job it was generally until the age of retirement, 30+ years. Companies gave pensions to workers to encourage longevity with the company. The retiree had a 401K, CD’s paying 15%, stock and bonds, and other high interest savings accounts. At retirement they lived off of monthly interest, in addition to Social Security. Retirees also had health, dental and vision insurance through that company until the day they died. People had their homes paid for by the time they retired.

What is Happening to the Retired Person?

Many companies have long pulled health insurance from the retirees, and pension plans are rarely available anymore. CD’s are paying next to nothing in interest. Simple interest bearing accounts have decreased from a hefty percentage to between 0.5% – 1% if one is lucky. These interest bearing accounts that people counted on as income no long exist for many. A good share of retirees have mortgages until the day they die. That is if they can continue to pay for their mortgage and the bank does not foreclose on them. Even though most retirees obtain Medicare to help with health costs, the governments will deduct one common price for Medicare and this year it is a little over $90.00 a month. Many retires cannot afford a supplemental medical plan so do not get their medications or skip doses because they cannot afford the cost of their medications. Many retirees are not finding this to be their golden years like their grandparents. In fact, many retirees are finding that it is harder to live from month to month. Food bank lines are longer than ever these days.

Where Can the Retiree Obtain Extra Funds?

In this current economy retirees are more prone to need to raise extra money.

• One good way to obtain extra funds is through a reverse mortgage, that is, if you have a good-sized equity in your home. The bank will make payments to you every month and they can add this income to your Social Security. Unfortunately, if you have little equity in your home then a reverse mortgage will not work.
• If you can’t afford to pay your mortgage, there are government subsidized apartments you could check into. Monthly rent is calculated according to how much income you have.
•  Another way to obtain funds indirectly is weekly food banks. If the retiree visits 2-3 food banks every week you could get the majority of their groceries even one food bank can result is significant savings.
• Retirees are allowed to make $1,200 from a job per month. A part-time job could bring in extra funds if you are able to work.
• Retirees can also think up some sort of business plan and work from home. Doing this will enable you to claim a portion of all expenses, such as mortgage, utilities, and so forth at tax time, reducing taxes. This would possibly give the retiree extra funds though tax returns.
• Some retirees return to school and start a new career to bring in extra capital.

People who have planned for retirement are still finding if difficult to make ends meet. Some of these ways to earn extra income monthly may be helpful to the retiree.

This article was compiled by Jem. His attentions span the two things we are most likely to meet in this life, being health issues and finances. He specialises, somewhat in equity release. You can follow him on twitter at @witerjem now.

Everyone knows that insurance can be quite expensive, especially if you have a whole family to insure. With all the different types of insurance out there, it can be hard to know how to get the quality insurance your family needs for less money. Fortunately there are some things you can do to make insurance less of a financial burden. The following are 8 solid ways you can insure your family for less.

1. Raise Your Deductibles

Regardless of the type of insurance, you can almost always lower the amount you pay by raising your deductibles. The same goes for co-pays. If you raise them, the amount you pay for your insurance premiums will drop. Although this will give you immediate savings on your insurance bills, the costs you encounter should an insurance-related situation come about will be higher. Take the time to compare your premiums and deductibles, and analyze your family’s insurance needs. If your family would benefit from lower premiums and higher deductibles, go ahead and change them.

2. Stay Healthy

A great way to keep health insurance costs down is to be active and physically fit. By showing your health insurance company that you are a family devoted to staying healthy, the costs you pay for health insurance may drop significantly. Make sure your family eats healthy and exercises on a regular basis. Quitting smoking is another way to become healthier, and may cause your health insurance rates to drop as well.

3. Keep Your Home Updated

There are certain things that can be done to lower the amount you pay for homeowners insurance. By keeping your home’s electrical system up to date, you are greatly reducing the risk of a fire taking place. You should also take the time to install storm windows and doors to help prevent damage from any storms and high winds. Reinforcing or replacing your roof will also keep your home protected. Not only can these things lower your home insurance rates, but they will give you and your family peace of mind as well.

4. Get a Health Savings Account

In addition to health insurance coverage, these days it is a good idea to have a health savings account (HSA) as well. An HSA is basically an account you can use to pay your family’s health related costs, such as co-pays and deductibles, medicines, and so on. The money in the HSA is usually contributed by you and your employer. Health savings accounts may also be known as flexible spending accounts (FSA). Ask your employer today if you are eligible for one of these accounts, as they can really help lower the amount your family pays for health insurance.

5. Get all Available Auto Insurance Discounts

There are some things you can do to lower the amount your family pays for automobile insurance. If your family owns more than one vehicle, it is probably in your best interests to insure all of the vehicles on the same policy. This is because most automobile insurance companies offer multi-vehicle discounts to their customers. Another thing you should do is make sure all drivers are as safe as possible. The fewer accidents and tickets on the policy, the cheaper your auto insurance rates will be.

6. Add Security Features to Your Home

By installing certain security features in your home, you can easily reduce the amount pay for homeowners insurance. Security features such as sprinkler systems, burglar alarms, working smoke and carbon monoxide detectors, and advanced window and door locks are all ways of making your home much safer. This will show your insurance company you are serious about keeping your family and home safe, and in return they may drop your rates.

7. Consider Term Life Insurance

If you are thinking about purchasing life insurance, consider term life insurance instead of whole life insurance. Term life insurance is usually much more affordable than whole life because it is paid for and in effect for a certain number of years (the term), instead of building cash value over time. With all the options and terms to choose from, you are bound to find a term life insurance policy to fit your needs and budget.

8. Always Shop Around

In addition to taking the proper steps to insure your family for less, you should always remember to shop around for all of your insurance needs. Shopping around can help you save a lot of money on all types of insurance. Since there are so many insurance companies out there, you should always take the time to get quotes from multiple companies before choosing one. Not only do rates and policies vary from one company to the next, but the levels of customer service as well. You want to make sure you find a company that will give you both great service and competitive rates.

These are all solid ways to insure your family for less. Now that you how simple it can be to lower the amount you pay for all types of insurance, you should be able to provide your family with every type of insurance they need. Once your savings start adding up, you will be so glad you took the time to do these things.

Guest post from Bailey Harris. Bailey writes for InsuranceQuotes.org.

By Tim Brown

Unless you promote your business, there is hardly a chance of it succeeding. Running your business effectively requires that you promote it effectively. One way to do that is  by hiring professionals to do the job. However, you may be on a tight budget. In that case, here are some low cost steps to market your business. Remember, effective  promotions lead to higher profits.

1. Employing Social Media

Expand your business through social media. Interactive marketing in the US will hit nearly
$55 billion by 2014. Social media is expected to increase to $3.1 billion by 2014. Social marketing
is a top priority for 45% of senior marketers. Companies are adopting social media tools such
as Facebook, Twitter and LinkedIn to effectively market their business. Every company must
participate in social media to stay competitive. The web and social media have transformed the
communication process for the marketers. The opportunities presented with this faster means of
communication should be availed by the marketers to accelerate the market acceptance of their
businesses.

2. Exhibition stands

One of the best ways to generate sales for a newly setup business is through customized exhibition
stands. Promotional stands are effective for generating initial sales and marketing a new business.
It is essential that you present yourself in a professional manner and be able to capture your target
audience’s attention. Make your stand attractive by add high quality graphics and banners. It is vital
that you portray yourself as a truly professional company with great prospects.

3. Brochures and business stationary

Giving out brochures and business stationary is an effective way to promote your business. Design
an eye catching brochure and provide the consumers with all the essential detail about your
business. Don’t forget to add important contact details. Business stationary is also an effective
marketing tool for promoting your business.

4. Press releases

Press releases are a great way to attract the target audience effectively. It is important that the press
release is properly formatted in order to achieve the desired impact. Another thing to keep in mind
is that your press release is engaging and provides a quick read.

Tim is a brand promotion specialist. Tim has been helping businesses improve their promotional
efforts over the last 5 years. He specialises in branded promotional pens and promotional backpacks

After a week or two of the New Year, many of us are starting to wonder why we ever vowed to those resolutions in the first place. Sure we want to get our spending under control or shed a few extra pounds, but these goals require lifestyle changes that aren’t always the easiest to make. However, throwing in the towel on those New Year’s resolutions may sabotage you in more way than one.

In addition to improving your health or overall mental well-being, several New Year’s resolutions will also help you get a better hold on your finances, especially if they are one of the following:

Getting Fit

If you have vowed to lose weight in the new year, you should definitely stick with that diet and exercise plan – even if it seems to be killing you right now. Not only will sticking to a diet plan scrape a few extra dollars of your everyday food bill, but choosing to live a healthier lifestyle overall will potentially save you thousands of dollars over your lifetime.

Heavier or obese individuals pay higher insurance premiums and tend to have higher medical expenses because they suffer from other conditions such as diabetes and heart disease. However, by keeping trim, you can enjoy a better quality of life and keep those extra dollars in your pocket.

Getting a Better Job

We all know that getting a better job will definitely increase your personal net worth in the long run, and for that reason alone, you shouldn’t give up on your job hunt so early in the new year. However, to increase your chances at getting a job, you might want to also consider adding to your current skill set through additional education.

While enrolling in radiation or pharmacy technician training can’t promise you a new job, those who are more educated make more on average – even in this weak job market. So if you want the best chances at increasing your wealth through a better job, don’t give up the hunt and consider increasing your education.

Giving Up Vices

There is no doubt that smoking and drinking are expensive habits, and choosing to give up these types of vices can save you in other ways aside from the amount you spend on product alone. Like losing weight, giving up smoking and drinking can also save you money long-term due to the health conditions commonly associated with them. So it might be hard to avoid that happy hour or that 5-minute cigarette break, but giving up these vices now can literally save you thousands of dollars over the course of your life – allowing you to put that money towards more beneficial things such as your retirement account.

Sticking to those New Year’s resolutions is never easy, but that doesn’t mean you should throw in the towel so early. Even when it seems tough, commit to making those lifestyle changes as they will definitely better your overall life and increase your personal net worth. So if the end results isn’t enough motivation, consider the dollars you will be tucking away by sticking to those resolutions – it may be just the motivation you need.

Alex Summers

Alex is a soon to be MBA graduate who is getting his financial ducks in a row after the money management disaster that is the college experience.

With the current economic meltdown and post recession hangover, the cost of almost everything has been increasing by leaps and bounds.And the cost of child care is no exception. The latest updates of Department of Agriculture (USA) claims the cost of raising a child has been amplified ten times since 1960. In fact for a family with an average income, the cost of child rearing ranges between $11,650 and $13,530 each year. If you are a new parent and feeling worried how to deal with the overwhelming cost of child rising, the following points can help you. As a parent, you may feel like it is always necessary to provide your children with the best products but remember, to keep your finances in the right order, you have to take some strict steps sometimes. Read on to know some frugal tips which can make your task of parenting/ raising children less expensive.

• You will be surprised to know that the most money you will spend on a new born baby is on their diapers. However you can easily save some bucks on diapers, if you use diapers made of cloth along with snappy, instead of using disposable diapers which is quite expensive.
• Sometimes, people have an unhealthy fixation on brand names and they spend a huge amount just by shopping branded products for their kids. Nevertheless, if you can stick to a brand only while buying foods for your kids and not while you shop for clothes, you can save some bucks.
• If it’s your second child, utilize the toys or clothes of your first kid and make full use of it. Buying brand new stuffs is simply unnecessary when you have spare ones, in your house already.
• Save both your kid’s health and your money by avoiding expensive dining out and preparing foods at home.
• To fund your child’s college days, start saving from the very beginning. Open a savings account for your child and keep saving money in it. Many states also offer Prepaid college funds that can drastically reduce the cost of college if you start early enough.
• Parents often spend a good amount of money buying cute little bath toys. Definitely the chubby little pig, hefty hippo, the sweet cow look quite cute on the tub, but are they at all necessary for your kid’s entertainment? A Kid hardly notice such things and mostly play with water and the plastic cup. So, make sure avoid such luxuries and save the money up for some more important spending.
• During Christmas or birthday parties, parents often arrange for expensive gifts not only for the birthday girl but also for her friends. Cut back expenses on them. Make sure you don’t spend beyond your means to buy gifts. Remember, curtail on gifts does not mean cut back on love and you can always express your love to your dear ones without presenting any expensive gifts to them.

Last but not the least; remember the cost of raising a child varies place to place depending on the area and location. However, the rule of saving money is more or less same everywhere. Create a strategic plan for your child ‘future’, based on your current income, and help your child realize the value of money from his very childhood.

Best,

Terrell

Christmas has past and the new year is upon us. It’s a great time for some personal reflection. First, look back and think about last year. Did you have a good year? A worthwhile one? Did you treat people well and appreciate your family? Did you enjoy yourself? Did you conduct your finances in a responsible manner? Certainly, there are many questions you can ask.

Next, once you’ve reflected back, it’s now time to look ahead to the new year. With your goals for the next year and with your assessment of the past in mind, make a list of resolutions that you hope to achieve over the next twelve months. They can be personal or work-related. They can be collective goals for your whole family. What matters is that these resolutions establish objectives and guidelines for the upcoming year.

At this point, you may want to insure that some of your resolutions are financial in nature. This will help you be better prepared for whatever awaits you financially in the new year. To best do so, here are a few pieces of advice to keep in mind:

Plan Your Major Purchases

Do you have any major purchases or expenses that will take place this year? This could include the expense incurred by a new car, a new home, or a family vacation. It’s important that such capital expenditures work their way into your financial resolutions. You can do this by sketching out some of the costs. If you’re looking to get a new car, for example, you may want to look up cheap insurance quotes before you finish that resolution.

Consider Your Spending Habits

There are very few people out there who have no spending habits that they’d like to improve. Whether you spend more than you’d like on clothes, food, entertainment, or even household products, it’s important to note those areas where you don’t need to spend as much as you do. Then, resolve to improve this year. 

Look At Last Year’s Budget

If you were content with the way your financial life worked last year, and if you expect to have a similar income this year, look at your statements and budgets from the past year and make plans for how to replicate them. If you weren’t content with your financial situation, have a plan for rectifying this. Things like “get a better job” and “pay less for gas” are certainly easier said than done, but you’re much more likely to accomplish your goals if you explicitly acknowledge them and try to work towards constructing a plan.

If you need to reduce expenses look for specific expenses to cut rather than just having a general idea that you just need to reduce expenses. Perhaps you can reduce meal expenses by bringing your lunch to work, or reduce cable expenses by going with the basic package. Often the best things to reduce are smaller on-going  expenses rather than looking for one big expense to cut. Of course if you  need to cut  and you did spend $5000 last year on a Disney vacation replacing that with a week of camping at a local lake or other less expensive activity would certainly make sense.    See: Money-Saving Ideas for Frugal Moms and Dads for more tips.

With these tips you can hopefully start planning your New Year financial resolutions. For the health and wellness of both you and your family, it’s important to go into the new year with a solid monetary plan.

Have a healthy and blessed New Year.

Alex Summers

Alex is a soon to be MBA graduate who is getting his financial ducks in a row after the money management disaster that is the college experience.

Naming specific beneficiaries for your assets is a great way to direct wealth to specific persons, trusts or organizations without going through the potentially, long and costly
probate process.  Assets of this nature are often referred to as “controlled assets” because upon death these assets are automatically directed to the named beneficiary before the probate process begins.  It is important to mention that drafted Wills of Last Testament are first reviewed by the court system during the probate process.  Thus, assets with a beneficiary designation are excluded from any bequests in the will.  Worded differently, these assets will not make up the property available to distribute according to the wishes stated in the Will of Last Testament.  Problem? For some people; Yes.

If you are making very specific bequests in your wills pay close attention to all of your “controlled assets” and review their corresponding beneficiary designations to ensure they are up-to-date.  Assets that are jointly titled or held in IRAs, annuities, retirement plans (401k, 403b, Simple IRA, etc.) and life insurance all have beneficiary designations.
Typically, retirement assets make up a substantial portion of a person’s net worth; therefore, it is extremely  important to review your  beneficiary designations.

I came across a situation where a couple had each drafted a very specific Will of Last  Testament naming their children (from a previous marriage) as the recipient of  their investments in place of each other.  Unbeknown to them their wishes would never be fulfilled because 100% of their investable assets were either jointly titled or held in qualified retirement accounts with beneficiary designations naming each other as sole  beneficiary.  With second marriages,  drafting a will to include children per stirpes is common, but overlooking how  the investable assets are titled, like in the example above, can prevent  anyone’s good intentions from being carried out according to their final wishes.  That is why reviewing the titling of your assets is critically important when preparing your estate plan.

Changing the beneficiaries or the joint titling to a child may seem like the answer.  However, because the value of your assets will be unknown at the time of your passing, drafting a revocable living trust may be a more suitable option.  Naming a revocable living trust as beneficiary of your assets will pool the assets together and then allow you to divide those assets on a proportional basis, assuming multiple people are intended to receive those assets.  At death, all of the assets directed to the revocable trust will pass according to the terms of the trust.

Please note, any assets directed to a revocable living trust will be included in the deceased’s gross estate when calculating estate taxes, if applicable.

Please understand that I am not authorized to practice law on your behalf.  The observations, comments and recommendations set out in this article are intended to serve only as a foundation for discussion with your estate planning attorney.  Considering the complexity of estate planning, the recent changes in the tax laws, and your growing estate, I strongly recommend that you consult with an estate planning attorney to review these matters and to prepare your final estate planning documents.

This article is provided to you by Jaime Pyles, Retirement Planner by day and co-author of Busy Mom on the Go by night.  Busy Mom on the Go is a blog geared towards family-fun activities and easy living.

Do you know how much do you pay for your electricity every month?

Most of us don’t always take a good look at our utility bills, preferring to pay the amount due without so much as a perfunctory glance at the numbers that reflect our consumption pattern. This bad habit prevents us from knowing where and how to start cutting down our electricity costs effectively.

So if you’re really serious about reducing your electricity bills and conserving the planet’s energy reserves for that matter, take a look at the power consumption labels on your home appliances. It will give you a clue as to how you can take a step towards wise energy use. At the same time, you will also know which appliances you need to replace with newer, more energy-efficient models or to repair for better performance.

Power consumption is measured in kilowatt-hours, the same reading that your electric meter uses to measure how much electricity you’ve used up in a month. 1,000 watts = 1 Kilowatt. Running a 1 KW appliance for 1 hour uses 1KWh (kilowatt-hour).

Some of the appliances that are most notorious for being power monsters are:

1. Heat pump: 15,000 watts

A warm house during winter can take its toll on your electricity bill, running for as long as 15 hours every day. Assuming that this costs you $1.50 an hour, this adds up to $22.50 per day and $675 per month, just for heating.

2. Refrigerator: 1,000 watts

Your fridge is one of the round-the-clock appliances that can figure big-time in your electricity bill. It consumes the most electricity when the compressor kicks in to maintain the right temperature inside the fridge. Try to minimize the time the door is left open, and try not to put warm items directly into the fridge so that the fridge won’t have to work overtime to keep everything cool.

3. Clothes dryer: 4,000 watts

While the clothes dryer doesn?t remain constantly on, one cycle can really eat up a big chunk of power. If you don’t have to wear particular clothing items immediately, put them on a hanger and let them drip- and air-dry.

4. Electric range burner: 1,000 watts

Do you enjoy cooking your own meals? While this is the healthy and wise option, running your electric burner for hours on end can rob you blind in terms of energy costs. If you’re living with your family, cook enough for everyone so that nobody has to make his own meal or dial for a pizza delivery. Be sure to time your dishes so that you don’t overcook the food and waste power in the process. Skip the pre-heating when whenever possible and turn the burner off a minute before it is done cooking. The heat in the pan will continue to cook the food with no extra energy use.

5. Dishwasher: 1,200 watts

Washing dishes by hand seems to be a thing of the past, but it’s actually the cheaper alternative to electric-powered washers. Don’t turn it on unless it can run on a full load, otherwise you’ll be powering it up to wash a couple of plates and cups every now and then. Leave the dishes in soapy water in the sink to take away the smell. If your dishwasher features a no-heat drying cycle, be sure to hit this button more often.

6. Water  Heater: 2,400 -4,400 watts

Keeping water hot uses energy but bringing it up to temperature from cold uses even more energy. Everytime you turn on the hot water faucet you add cold water to the tank that needs to be heated from roughly 50 degrees to whatever you set your tank at… generally from 120 to 140 degrees. The higher the temperature you set it at the more energy is used to get it there and maintain it there. Set your water heater as low as possible to minimize both heat loss and energy used to get it up to temperature. Also you might consider an extra insulation blanket to help keep the heat in. These water heater wraps are available in most hardware stores. Try to limit your use of hot water to minimize the cold water being added to your tank.

This article was written by Justin Toladro from Life Insurance Finder, A comparison website that helps you compare life insurance policies that best suit you and your family.