So What Kind Of Benefits Can Investment Property Afford

Category: Finance, Financial Planning.

Recent studies suggest that the amount of people jumping on the investment property bandwagon is set to rise over the next six years, due to the 2012 Olympics. So what kind of benefits can investment property afford?

As with the many other benefits brought about by London s hosting of 2012 Olympics, this predicted increase in investment property will not just affect London but all major towns and cities in the UK. Stability in Investment Property. Although taking risks on the stock exchange may yield higher returns, investment property can provide you with a stable, steady income and a relatively secured level of return on investment. Whether you are a first time buyer set to buy your own home or an influential investor looking into investment property the benefits which the investment in bricks and mortar afford, should not be underestimated. When looked at with a long- term view the investment property is unlikely to ever lose you money. Put simply, property is historically stable and if you are prepared to wait it out you can make money on it. You may have to pick the right time to sell a property but as long as you keep looking at this investment with a long- term view you will be hard pushed to go wrong.

Financial Gain. In short, one of the most significant benefits with regards to investment property is that as long as you have a bit of free capital you are able to borrow money from the mortgage lenders, in order to buy a property which you can then let out and charge tenants money in order to pay back the mortgage lender. If you do your homework and consider your investment property as a long term investment the financial gains to be won through investment into property are fairly substantial. In affect you become a middleman who is set to earn a good return on investment as long as you decide to follow a few basic steps. Studies suggest that, a home doubles, on average in value every seven years and whilst this is not guaranteed as long as you have the property correctly evaluated and you buy in the right area you can feel certain that you are making a good, financially sound investment. Return on Investment. This means that if you have a lump sum of money which you are interested in investing then Investment Property is certainly a type of investment worth having a look at.

First, A Definition Of Wealth

Category: Finance, Financial Planning.

First, a definition of wealth.

Those kinds of wealth are wonderful, definitely. I m not talking about a wealth of friends, or experiences, or interests. But right now, I m talking about money- lots of money. Wealth building, for the most part, involves four financial aspects: Growing a cash machine. Exactly what" lots of money" means is subjective, but let s say that when your annual income becomes your monthly income, you re playing in the wealth ballgame. Allocating assets.

Managing/ eliminating Debt. Spending planning. Growing a Cash Machine* This is the most important aspect of the wealth building foursome. You cash machine is an incorporated business, which is ideally based on leverage of your existing skill set. In fact, it is the foundation for the other three areas, whose sequence depends on the nature of your particular cash machine. For example, say you are an automobile mechanic.

How can you leverage your skills so that you have a business that makes money while you sleep? (The definition of a cash machine) . That s a service. Here s a scenario: People buying used cars come to your shop for inspection before they buy, and you realize that many of the things you check during your inspection, the consumer could easily check for themselves. Make them into an ebook, and voila, hire a marketer you have a cash machine. You teach a class at the community college and you package the hand- outs you ve created for the class. That s simplified, but you get the idea.

Think of something similar you could do with your skill set, and grow a cash machine. Wealth builders are generally entrepreneurs. Allocating Assets* With the income from your cash machine, plus all your other assets, create a comprehensive plan for your assets to work for you. You ll need advisors to set up an incorporated business for your tax strategy as well as asset protection. You ve heard the saying, "Stop working for money and get money working for you. " If you haven t already put a team together to grow your cash machine, with asset allocation a team becomes critical. And, you ll want a financial advisor to help create your overall plan.

Millionaires" hire" time. One of your most important assets to allocate is time. Invest in building yourself a team of experts and support personnel. Spending Planning* When the cash starts rolling in, a common mistake is to allow spending to keep pace with the increased income. In addition to expert advisors, housekeepers, hire bookkeepers, assistants, etc. This makes for a cushy lifestyle, but isn t part of a good wealth building plan. It doesn t need to be restrictive( like a budget) .

When you create your spending plan, it should reflect your personal priorities. Think of it more like a framework for financial decision- making that serves your long- term interests at the same time providing resources for you to enjoy the present. However, not all debt is bad. Managing/ Eliminating Debt* Once you ve got your cash machine going, turn your attention to arriving at zero consumer debt: credit cards, etc, mortgage. Sometimes, you want to leverage someone else s money. But for the most part, a focus on minimizing or eliminating debt is a sensible part of any wealth building plan.

Buying income real estate is an example of such a time. The ultimate goal of wealth building is financial freedom- when your passive income supports your lifestyle, and you work because you choose to, rather than because you have to. Use the wealth building foursome to lay the foundation of your financial freedom.

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This Is The Gut Check Buy/ Sell Decision Making Process - Finance and Financial Planning:

The recent events in the stock and bond markets drew everyone s attention.

There Have Been Plenty Of Stories Come Out Of Late Of Mismanagement Of Funds Buy Funeral Homes

Category: Finance, Financial Planning.

So you go through the checklist and make arrangements for your will and your DNR or do not resuscitate so the medical people will know what to do in the event you cannot be brought to consciousness. Many funeral homes sell packages where you can pay for your casket and much of the funeral expenses well in advance.

But one level of preparation for your final years of a very full life that you may not have decided about is funeral preparations. This is very appealing because you can think ahead about how you would like the funeral to go and select the casket and make arrangements so there is less guesswork for your family and loved ones if the moment comes up too quickly. You do not want to leave your children to have to try to figure out your life insurance, your will and, your estate issues your funeral if your demise comes along suddenly. That is the real appeal of preplanning all aspects of what might happen when your final moments come. Most of these preparations are pretty cut and dried and you want all the paperwork in order, legal and the person assigned to resolve your estate informed and legal so there is no time lost on getting things the way they should be if the moment were to come. For one thing, you must be absolutely sure you are in the town where you will want to be buried. The big step of pre- buying your funeral plot, casket and paying for the funeral in advance is something to give some serious thought to.

Many times later in life, a retired person wants to pack up and move to where the kids are living. If you are living in an assisted living center, the move is just not that difficult. That is one of the good things about begin retired and relatively unencumbered by a lot of possessions. So you do not want to own property, even if it is just a burial plot and have to deal with transferring all of that paperwork to another town if you do move with your kids. There have been plenty of stories come out of late of mismanagement of funds buy funeral homes. But the compelling reason not to put money into a funeral arrangement package is that funeral homes are not great at managing those funds. Or if the company owning the funeral home is bought, many times the new company will not honor your contract with the previous owners and your relatives find this all out just when they least need to hear about problems.

You can name who you want to have access to the trust and even write out in specific detail what you want the money used for and how you want the funeral to go. A much better option is to take the same money you would have put into funeral arrangements and put it into a trust set aside just for this purpose. That form of living will or ethical will gives your relatives the resources they need to conduct your affairs and the directions you want them to have. The money can accrue interest and it is secure because it is still owned by the family right up until it is needed. But they have the flexibility to pick the funeral home and buy the plot that seems right at the time. The desire you have to get your final arrangements arranged is a good one.

But thinking through some of the problems that can come up if you do too much prearranging gives you the wisdom to make the right choices so you can enter your retirement years knowing that everything is arranged when and if, the moment of, God forbid your departure comes along.

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A Second Factor In Economic Growth Is Education - Edith Jelinek about Finance and Financial Planning:

Alan Greenspan writes extensively about the global economy in The Age of Turbulence. One is a cultural desire for growth, which includes government integrity, the acceptance of a certain amount of income inequality, incentives to take risk and the willingness to let market forces determine supply and demand.

If You Are Covered By FERS, Or CRS Offset, CSRS, You Are Eligible For A TSP Plan - Stacie Siddens's Finance and Financial Planning blog:

What is a thrift savings plan? The TSP falls under the category of what is known more broadly as a type of defined contribution plan, and is administrated and regulated by the Federal Thrift Investment Board.

There Are Many Benefits To Having Your Money Problems Under Control - Finance and Financial Planning Blog:

I could only guess what a great feeling it would be to be totally out of debt. Although most people will have a hard time getting a handle on the money that goes through their hands if you plan everything right you most certainly can take control of your money.

This Money Must Be Leveraged For Gain

Category: Finance, Financial Planning.

Leveraging money certainly is not a new concept. People converted their labor into goods and leveraged the goods to acquire other goods.

The idea has been around even before the concept of money itself. When you work for wages you are basically doing the same thing. Leveraging money can be used in many ways. If you are a carpenter you trade your skill for money and the contractor uses your finished product parlayed with other people s skilled work as a leverage to get a profit. One of the most simple ways is to lend money for percentage. They pay you a percentage on your money and in return they lend the money, say to the contractor for a higher percentage.

When you deposit money into a savings account you get a percentage back from the bank for their use of it. You can also go the the contractor and lend the money for a higher return, circumventing the bank. If you are going to invest your money by trusting it to a business consortium. Retailers leverage money by buying goods at wholesale and selling at retail, which produces a profit. Investigate the background of the people involved to assure the safety of your money. Be Faithful To The Program.

Don t listen to the get- rich- quick schemer, always look at past projects and the return he/ she has generated. No matter if you are buying and selling, trading labor or investing, you must be faithful to the ten percent rule. Ten percent of everything you make is yours! Remember from the last lesson? This is your nest egg, your ace in the hole. It s a simple matter of budgeting. This money must be leveraged for gain.

Maybe you won t be able to buy that new sound system, or you will have to drive a cheaper model car, but you will be laying a foundation for you and your loved one s future. You are a responsible person of vision as you have recognized your duty to yourself and your loved ones. You will be ready when the children are ready for collage, because you took the steps to prepare for the future. Ten percent. Tax yourself, and use that tax money to leverage your way to wealth and security. In many places you pay that much in sales tax. Second: most important leverage of money is in Insurance.

Term life is simply you lending money to the insurance company for a certain return. That s right insurance, life and health. When you are young the insurance company will pay for your money because they know the odds of you dieing is low. You can either ride out the term and use your accumulated interest to help pay your payments or cash out and invest the interest gained. As you grow older the odds increase and the payback is less, so goes the name" term insurance" . The important thing is, your benefactor gets paid because you covered any mishap that might befall you. If there were a thousand dollar bill attached to this article, could you start today and between now and the same time next year, double that amount?

The Earnings Are Automatic. It takes a little skill but it can be done. At the end of the second year, $4, 0000. Starting with$ 1, 0000, at the end of the first year, your investment has grown to$ 2, 0000. At the end of the tenth year, you will have accumulated wealth amounting to$ 1, 024, 000now your financial performance goes into high gear. You have yet to apply techniques of OPM or external leverage. The technique has been the simple on of investing your money for a given return over a given period.

Let s look at an example of using OPM to increase money. The amount grows at a 35% rate. The example begins with$ 1, 0000 investment and assumes you make no personal cash addition during the ten year growth period. However, you will borrow, in this instance against your net worth and amount equal to it, you borrow, in other words$ 1, 0000 against your initial investment of$ 1, 0000, and then invest the$ 2, 000at 35% yearly. Assuming that you have$ 1, 0000 to begin with, you then borrow another$ 1, 0000 which gives you a working capital of$ 2, 000the first year s earnings, at 35% then amount to$ 700From the total of working funds plus your 35% return, that is$ 2, 0000, or$ 2, 7000, you must deduct 8% interest paid and the repayment of OPM. The cost of this loan is, let s say, 8% . These deductions total$ 800 and$ 1, 0000 respectively, leaving you a year- end net worth of$ 1, 620 It s For Your Benefit.

Do It Today. Remembering that you will not add any more of your own money to your investments at this point, you will now take that$ 1, 6200 and project earnings for the second year, again borrowing an equal amount to give you investment capital of$ 240by adding a 35% return to this amount, and then deducting interest and repayment of OPM, your second year net worth will grow to$ 2, 6200 For the third year, you will borrow an equal amount, giving you working capital totaling$ 240Continue this projection for ten years, and you ll find that, from your initial investment of$ 1, 0000, your net worth has grown to$ 124, 3800 by simple reinvestment and the use of OPM. In the next chapter we will discuss leveraging OPM or Other People s Money more in depth. Ten percent for investing in a more secure future is a small price to pay. Always remember nothing will happen if you don t get started in paying yourself 10% of your earnings. Don t delay, pay yourself a personal security tax and put it to work. Happy Trails

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Financial Planning - Finance and Financial Planning Articles:

Financial planning.

These Will Only Give Back A Small Amount Of Interest - Finance and Financial Planning Blog:

Few families pass on actual knowledge about wealth building to their children.

Once You See What You Want, You Can Even Buy It Over The Internet - Finance and Financial Planning Articles:

Throughout the ages, people of all races have desired, luxury, and searched for. The desire for luxury is entirely natural, and people have found hundreds of different ways to pursue it.

This Enables Borrowers To Purchase The Home, You Don T Have To Pay 100% Cash For The Home And You Still Never Have To Make A Mortgage Payment For Life

Category: Finance, Financial Planning.

A Reverse Mortgage is a national program which typically is offered to homeowners 62 years and older but some private programs have recently been opened to borrowers down to 59 1/ 2 years old which allows the homeowner access to their equity in the form of cash, monthly income to the homeowner, or a combination of both with the homeowner never making another loan payment for life. There are very minimal credit requirements and no income requirements to qualify, borrowers can even be in foreclosure and still obtain a reverse mortgage.

The money the homeowner receives is usually tax- free and does not affect Social Security benefits or Medicare( check with your financial advisor for your circumstances) . Did you know that if you are a senior borrower, aged 62 and over you can use a reverse mortgage to purchase a home as well as just to refinance your existing home? This enables borrowers to purchase the home, you don t have to pay 100% cash for the home and you still never have to make a mortgage payment for life! Many senior borrowers have heard about the benefits of paying off an existing mortgage with a reverse mortgage, that they never have to make another mortgage payment, but many are still unaware of the fact that they can also purchase a new home or second home using that same reverse mortgage. Many senior borrowers are set with their current homes and have no desire to move. Some wish to keep their current homes but want a second home near children and grandchildren, or in climates, near favorite activities more favorable during certain times of the year.

However, there are also a growing number who need to downsize, have decided that their current home just doesn t fit their needs and can t easily be changed to do so( like wheel chair access or multiple stories) or have amenities that they wish to get away from that they no longer desire( like large lots with pools and excessive landscaping, etc) . But with no steady income streams and the fear of starting again with mortgage payments, many have thought that they just can t buy the properties they want. The reverse mortgage has become an excellent tool for these seniors to purchase the homes they desire without qualification requirements and with no payments for life all without having to pay for the homes outright. Some are almost in a position to buy these homes, but it would take all their available savings and they do not want to use all their funds. So if you, a loved one or a client of yours are 60 or older and are looking to buy a new primary residence or second home or always wanted to downsize but never thought you could actually do it and still get a home you would be happy with, give a specialist at All Reverse Mortgage Company a call and let us show you how a reverse mortgage might be just the tool for you!

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The Policy Has A Large Loan - Finance and Financial Planning Articles:

Most people do not know they can sell an insurance policy. Even term insurance, which has no cash value, is a candidate for purchase.

This Scholarship Needs No Explanation - Flossie Friedrichs's Finance and Financial Planning blog:

Scholarships are a great way to pay for college education. Thankfully, there are scholarships that rely on other kinds of distinction.

In Order To Prevent Such An Eventuality, You Can Incorporate A No Contest Clause In Your Will - Mandy Delcambre about Finance and Financial Planning:

Estate planning is an effective measure undertaken to ensure that the assets you possess, which are usually the outcome of a lifetime of labor, are transferred to the recipients according to your wishes after your demise.

The Word Balance Has Different Meanings At Different Times

Category: Finance, Financial Planning.

A balance sheet is a quick picture of the financial condition of a business at a specific period in time.

They are profit- making activities, which includes sales and expenses. The activities of a business fall into two separate groups that are reported by an accountant. This can also be referred to as operating activities. Profit making activities are reported in the income statement. There are also financing and investing activities that include securing money from debt and equity sources of capital, returning capital to these sources, making distributions from profit to the owners, making investments in assets and eventually disposing of the assets. Financing and investing activities are found in the statement of cash flows. The statement of cash flows also reports the cash increase or decrease from profit during the year as opposed to the amount of profit that is reported in the income statement.

In other words, two different financial statements are prepared for the two different types of transactions. The balance sheet is different from the income and cash flow statements which report, income of cash, as it says and outgoing cash. The word balance has different meanings at different times. The balance sheet represents the balances, or a company, or amounts s assets, liabilities and owners equity at an instant in time. As it s used in the term balance sheet, it refers to the balance of the two opposite sides of a business, total assets on one side, and total liabilities on the other. Accountants can prepare a balance sheet any time that a manager requests it. However, the balance of an account, such as the asset, revenue and expense, liability accounts, refers to the amount in the account after recording increases and decreases in the account, just like the balance in your checking account.

But they re generally prepared at the end of each month, quarter and year. It s always prepared at the close of business on the last day of the profit period.

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The Trust Would Then Sell The Property To The Real Estate Developer - Finance and Financial Planning:

Charitable remainder trusts can increase your income, avoid capital gains taxes, lower or eliminate estate taxes, serve as another type of retirement plan, serve humanity and put a warm feeling in your heart. In the Path of Progress.

So. What Is Cash Flow Planning - Roseann Bisson about Finance and Financial Planning:

You ve heard it a million times- cash can make or break a business. In fact, many PROFITABLE businesses fail because of cash flow issues.

You Cannot Wait To Leave Your Job And Enjoy Your Life - Finance and Financial Planning Articles:

Let s just say your 5 or 10 or 15 years or so away from when you think your might retire.

Pensions Management Returns

Category: Finance, Financial Planning.

In terms of pensions management, your location in the world doesn t matter, nor does the type of pension you have- a sipps, a self- invested personal scheme, or a self- administered scheme. Is a 20% Return Realistic with Low Risk?

What you are interested in is that when you become a pensioner, your pension s management has performed to provide you with a comfortable retirement and does not give you a short fall on your expected cash! Here we want to look at how a+ 20% annual return is achievable and drawdowns can be kept to manageable levels. Firstly, the best way to trade the markets is without emotion and this means using a technical based approach to pensions management. Pensions Management Returns. The reasons for this are: A technical approach to pensions management takes the emotion out of trading and allows a disciplined trading plan, which can liquidate losers quickly and run the big profitable trends. This means there is more money going to you and less in fund manager s fees.

If the technical system is based upon holding onto the longer term trends the commission impact on the pension s income is less than on a shorter term strategy. Even a good technical system will not hold losing trades. Pensions Management- The Risk. Losses will always occur for any fund manager no matter how good they are, but the most important point is that they are manageable, and a good technical method can achieve this. The risks in any form of investing are always there, but there is a misconception about how to assess the risk. For example: The view may be that if a fund manager is investing in Far East tiger economies, then this is more risky than say investing in UK blue chip equities. Most investors look at the location of their pension, and see this as the main investment criteria.

This is only part of the equation though. A good money management strategy in a volatile area can reduce risk. If a fund manager is actively managing the pension or investment, you need to look at a fund manager s money management strategy. On the other hand, a poor money management strategy in a less volatile area can increase risk. A good pensions fund manager can achieve above average performance while keeping risk at manageable levels. Pensions Management- Balancing Risk and Reward. Here are some points you should consider when picking a pension manager: When looking for a pensions fund manager make sure that you take the time to find out the performance of all the funds under their management, not just the good ones!

Get to know them and see what their approach is and their reaction to your questions. Ask a fund manager to explain their strategy, so you know the way they manage and control the risk of your funds. You are trusting them with your retirement funds- so make sure you are comfortable with everything about them. Yes, it is- we know because we have produced gains like these for clients and so have other pensions management groups. Is a 20% Return Achievable? Use the above as a guide when shopping around for a manager and take your time.

You work hard, when it comes to retiring and taking your pension you want to make sure your pension can provide you with a happy and comfortable retirement.

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The First Is A Medical Power Of Attorney - Ingrid Grimley's Finance and Financial Planning blog:

Few topics confuse investors more than figuring out what estate- related documents they need.

Communicate The Fund Raising Idea - Finance and Financial Planning Blog:

In the next few minutes, you are going to learn the steps to implement a fund raising idea that can raise significant cash within a very short time frame.

Nobody Likes To Pay Taxes - Dianna Pouncy about Finance and Financial Planning:

Nobody likes to pay taxes. Knowing some simple rules will reduce your tax bill and allow you to keep more of what you inherit.

A Second Factor In Economic Growth Is Education

Category: Finance, Financial Planning.

Alan Greenspan writes extensively about the global economy in The Age of Turbulence. One is a cultural desire for growth, which includes government integrity, the acceptance of a certain amount of income inequality, incentives to take risk and the willingness to let market forces determine supply and demand.

He believes there are common dominators to economic success. Markets are the antithesis of government decision making. The socialism of Western Europe and the populism of Latin America are lesser forms of substituting the wisdom of government for the marketplace. The fall of Russian communism showed the fallacy of central planning. Western Europe( India and elsewhere) suffers from bureaucracies with extensive approval processes which slowdown change and bureaucrats who substitute their judgment for the market. A second factor in economic growth is education. Restrictive work rules imposed on employers drive up costs and reduce the incentive to take risk, resulting in lower growth and, higher unemployment, perversely.

It speaks for itself. Workers who save money( accumulate capital) and contribute to their heath and retirement plans aid economic growth. A third is a young, population, or growing. Non- workers, who consume these, such as retirees services, which have been promised to them by their government but have not been funded, place a strain on economic growth. The last determinate of economic prosperity is a strong rule of law, defined as a protection of property rights( and, individual rights, by extension) . As the ratio of workers to retirees shifts, due to the aging of the baby boomers and increases in longevity, the burden of these transfer payments on an economy/ society increases. This is a major theme of Mr.

Property rights include real estate, goods and, intellectual property, broadly, commercial transactions. Greenspan s. A strong rule of law is not a dictatorship, in fact, it s just the opposite. As a corollary, risk premiums will be lower in this environment, meaning the cost of capital will be lower, promoting growth. Individuals/ companies will take risk, and invest for the future, if they can see a clear and consistent set of rules. We can extrapolate from Mr.

So let s go for an around the world tour. Greenspan s thinking as to the best international areas for investment. Western Europe has a strong rule of law but their bureaucracies, restrictive immigration which, aging population could otherwise offset an aging population, and expensive social services means their economic growth will be limited. It s overcoming its Communist legacy and production costs are low. Eastern Europe is on its way to a well developed rule of law and does not suffer from the problems of Western Europe( yet) . Russia has inconsistently applied laws which vary with the whim of its rulers. A currency inflated by the high price of oil and gas exports is another limiting factor.

It also has the Western European population demographics. However, an entrepreneurial spirit, abundant natural resources, and burgeoning consumer market are positives. Japan has greater population problems than Western Europe in terms of age and immigration and a bureaucracy structured to prevent companies from failing, and preventing foreign, limiting imports companies from operating in Japan. Russia has great potential but equally great obstacles to overcome. Yes, it has a strong rule of law but it is very Japan- centric. Mr.

Is it any wonder that the Japanese economy has been stagnant for the last 15 years? Greenspan says that it will no longer be the world s second largest economy by 203 China is the global wildcard. But a Western- style rule of law and the personal freedom which it, brings are in, and economic growth conflict with a ruling autocratic party. Its growth has been impressive and it has moved towards a comprehensive rule of law. One or the other will have to give way at some point. Greenspan believes that China s growth will continue, and although he doesn t come out and say it, China will surpass Japan in GDP by 203 India has a strong rule of law but a bureaucracy which makes Western Europe s look like a Ferrari.

Mr. Its growth has been impressive but it hasn t kept up with China due to severe infrastructure problems and cultural crosscurrents preventing its markets from freely functioning. Severe income inequality, education and rule of law( government instability and corruption) problems abound. Latin America is cursed with populism( take a look at Venezuela) , Brazil being the possible exception. Emerging economies, Mr. Of course, they carry great risk.

Greenspan cites Vietnam, are where the biggest money will be made. Nonetheless it will be exciting to see new economic hotspots emerge as the world looks for low cost production areas and certain counties seize the opportunity. Mr. Lastly, the United States looks pretty good by comparison to the rest of the world, despite our problems. Greenspan predicts we ll still be the biggest and the best in 2030, although a smaller part of a bigger global pie. Stick with Mr. How do you invest globally?

Greenspan and go with a strong rule of law. Constantly look for changes in law, or a shift in attitude towards a change, and watch for emerging gems. Invest in Europe, East over West and, if you can take more risk, invest in China and India.

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Their Attorney Was A Generalist - Tara Mayne about Finance and Financial Planning:

Ned almost lost the farm that had been in his family for 8 generations! Make sure you don t make the same mistake Ned did.

The Policy Has A Large Loan - Shawna Feinstein's Finance and Financial Planning blog:

Most people do not know they can sell an insurance policy. Even term insurance, which has no cash value, is a candidate for purchase.

Educator Expenses - Finance and Financial Planning Articles:

How many times have you done your taxes, and a week or a month later realized you forgot a deduction? In my experience, these are the top 5 missed deductions.

Federal Loans Are In Great Demand In The US

Category: Finance, Financial Planning.

No student in modern times is unaware of the benefit of student loan consolidation.

Even if you belong to the second category, do not despair. There so much information available in books and on the internet that only a blind person would still be oblivious to its advantages. If you cannot look up to your parents for financial help, there are scores of lending companies who are willing to extend a helping hand. You can get financial aid in school, college and even after you have left college for higher studies. All you have to do is reach out. All these loans will drag you neck deep in loans.

Available Benefits Of Consolidation. Now you need the process of resurrection that comes in the form of student debt consolidation. With the help of student loans consolidation program, you can decrease your monthly installment by a staggering 50% . This simply means that now you have half the installment amount in your hand as cash. This is a very good margin indeed. You can utilize this amount towards your other payments like car, medical, insurance, household, electricity and taxes to name a few. You can further reduce the monthly consolidated installment by increasing the term of the loan by up to 30 years.

With additional finance in your hand, you can even strive to improve your falling credit and bring it above 600 once again. If you invest wisely, you can even add to your savings every month by investing the savings on installment and receiving interest over the investment. It is always advisable for students to take a student federal loan consolidation program or loans that come under the federal direct student loans and qualify for federal consolidation. Look For A Federal Program. Federal loans are in great demand in the US. You have to pass an eligibility test to qualify for federal consolidation.

Most of the lenders are willing to disburse loans under a federal scheme due to its multi benefits. You can check your eligibility status on the internet. Federal loans make you eligible for a lock in lower interest rate. If you qualify for federal loans consolidation, there are many additional benefits in store for you. This lock- in rate is a shield against inflation for the students. In addition to the above, all federal programs used for student loans consolidation are free from any fees and credit checks. The interest rate for your loan after student loans consolidation remains constant, even if there is inflation and increase in rates of interest.

This means that students with bad credit can avail a federal loan. Therefore, do not wait any more, start hunting for the best student loans consolidation scheme, and apply immediately.

Brokerage Houses Generally Have Subprime And Private Equity Exposure, As Discussed Above

Category: Finance, Financial Planning.

The stock market is gyrating like a yoyo, and with each down stroke it s heading lower.

Let s start by dissecting the cause- it s not as simple as a slowdown in housing or defaults in the subprime market, and these are unrelated( for the most part) events. What s an investor to do? The housing market was headed for a correction regardless of the events taking place in the subprime market. Speculators in areas such as southern Florida and easy credit just pushed it over the edge. New home starts were running at twice the historical average during 2003- 200Granted, some of this was fueled by a relaxation( or abandoning) of underwriting standards in the subprime market but it also was the culmination of aging baby boomers buying second homes, and a strong, low interest rates economy. We would be in a housing slowdown regardless of the subprime problem, although this will exacerbate it, and a weak housing market will continue at least through 200Investors: avoid homebuilders.

The concerns over the creditworthiness of their businesses, not the level of defaults in the subprime market, have caused much of their funding to disappear. Mortgage lenders and financial companies in related businesses generally are leveraged and, rely on short, in many cases term debt to finance their operation. This is the biggest risk for many finance companies. This problem was not caused by rising interest rates. All finance companies are paying the piper for problems in the subprime market- lax underwriting standards and mortgage obligations that borrowers can t meet. Interest rates have gone up very little over the past year.

Do your homework in this sector to determine which companies have funding problems, subprime and related mortgage exposure, and which don t. The problem was artificially low teaser rates, the ability to skip payments, interest- only payments for a period of time and other contractual mechanisms which induced( or seduced) buyers to take on a bigger mortgage than they could afford. It s not obvious. Investors: Avoid originators, buyers, servicers/ holders of paper, and mortgage REITs, fixed income funds which are highly leveraged or focus on the subprime mortgage market. These problems will take a good year to sort out and companies will be destroyed or seriously damaged in the process. Banks generally hold some, but not a significant amount of, subprime mortgages relative to their total portfolio. The hit the banks took on the Chrysler deal is a good example.

The bigger risk for certain money center banks is their exposure to bridge loans and take- out financing guarantees for the many billions of dollars of private equity deals that are pending. This problem will work itself out by the end of the year. Banks without this exposure will do fine. Banks with private equity financing exposure could have one or two bad quarters. Investors: Buy banks without big private equity exposure now. Brokerage houses generally have subprime and private equity exposure, as discussed above.

Wait one or two quarters to buy banks with exposure to private equity. Investors: Give them one or two quarters to sort out their problems before you buy. These stocks have taken a hit. Mutual fund managers, and REITs that, investment advisors own income producing have little or no subprime exposure( again, do your homework on the specific investment to make sure) . Investors: Buy now.