Personal Finance Universe

This blog will help you with financial advice and decisions. For more information, search The Personal Finance Universe at www.thepersonalfinanceuniverse.com

Tuesday, July 31, 2007

Top Ten Personal Finance Mistakes - Part 1

Rule #1, Have a personal financial goal and a plan to achieve it. The pressures of bills and getting the income to pay them typically cause you to lose sight of your personal financial goals.

The second thing I ask a new client is, “If I could wave a magic wand to make it happen, where do you want to be in five years?” Or sometimes, “What do you want to be when you grow up?” I ask clients this no matter what their age, especially if I sense that they are living without direction. In order to get direction, you have to set a goal and then the path to that goal becomes clearer. It may be too hard to set a lifetime goal, but a five year plan is always achievable. Once you have a five year plan, you can break it down into smaller parts with the short terms goals being something you can achieve in one year or less. Every journey starts with the first step.


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Keeping a Tab on the Personal Finance

Written by george2007
Sunday, 29 July 2007

We have often heard about people who are known to be experts at managing finances at office but financial matters at home are relegated to a backseat. Maintaining accounts seems to be an intimidating thought for most of us who are not accountants. However, it is not a feasible idea to go about dealing with a problem this way. What is required is to take the bull right by its horns.

One of the important determinants of the personal finance is credit. In the domain of finance the credit score holds the key to the success. In the absence of respectable credit score, you would not be able to borrow money or obtain a home loan or a vehicle loan. The importance of this number can be judged by the fact that if this number goes wrong then it has the ability of leaving your goals unfulfilled.

Your credit number reflects the credit that is currently in your name. You get a poor credit score if you abuse credit cards and rack up high bills. That does not mean that the amount you're charged is harmful to your credit. On the contrary, it is the amount you keep on your credit cards that can prove detrimental to your credit score. It's not difficult to use your credit cards wisely and carefully. All you have to do is check your monthly statement and pay off your outstanding bill in full each month.

In today’s society, identity theft is often a problem. If someone steals your identity, they can wreck your finances, ruin your credit, and tarnish your good name and reputation. In order to prevent identity theft, carefully monitor all your financial statements and safe guard your personal information.

Most individuals put off saving towards retirement until a later date. Quite often, these individuals are often caught off guard by their rapidly approaching retirement date and the non-existent retirement fund. Instead of waiting until tomorrow, begin today. Take control of your personal finance situation and invest in a retirement fund immediately. Begin putting a portion of your income in this account in order to secure your future.

One of the best ways to handle the finances is a budget. This is the best way to keep a tab on the finances and keeping the spending in control. When you create a budget you need to make two columns, one meant for the incomes and the second for expenditures. You need to mention all the items of expenditure in the expenses column such as rent or mortgage payment, car payment, insurance, utilities, and food. Whatever is left after deducting all this from the income is the monthly excess that of course can be used in different ways.

It's a good idea to consult an accountant if you are not sure about setting your personal finance records straight. This person will help you correct any potential problems and ensure nothing goes wrong in the future.

The world of finance is fascinating. There's no need to be scared of it. Just keep your finances straight and you will be able to build, or rebuild, your credit score.

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Monday, July 30, 2007

Property boom in Central Europe pricing out locals



















Agence France-Presse - (AFP)

Jul. 23, 2007. 01:50 PM EST

In downtown Warsaw, real estate can be as expensive as in the heart of Paris. Across Central Europe, from Budapest to Bratislava, prices have skyrocketed as interest rates drop and foreign investors snap up prime proprety. It's a boom time for estate agents but a rough period for locals now priced out of home ownership. A voiced report from the Polish capital Warsaw and the Hungarian capital Budapest.


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Investing in Insurance: Opportunities in Student Loans



















Bloomberg-Clip - (BLOOM-Clip)

Jun. 04, 2007. 11:00 AM EST

Analysis and Discussion with Featured Guest Don Marron of Lightyear Capital: Looking for Investment Opportunities in Student Loans


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Outlook for TIPS and Inflation: A Good Time to Buy TIPS?



















Bloomberg-Clip - (BLOOM-Clip)

Jul. 30, 2007. 02:00 PM EST

Analysis and Discussion with Tony Crescenzi of Miller Tabak: Contained Inflation Expectations Hurt TIPS; No Credit Crunch Seen; Corporate Borrowing Not Drying Up; Yields Stable; Market Turmoil to Subside


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Life After Chapter 7 Bankruptcy: Rebuilding Your Credit

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Are You Throwing Away Money by Renting? Maybe Not

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Money Saving Tips: Make More of Your Herb Garden

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Choosing a Funeral Home

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Personal finance Q&A: Good credit

Associated Press

Question: I am a recent college graduate and have no credit history. How do I build good credit?

Answer: Having no credit history at all can be just as bad as having bad credit. The good news is that at least you're not thousands of dollars in debt. Still, your creditworthiness influences a lot of decisions.

"There are so many decisions based on your standing" beyond lending, said Lucy Duni, director of consumer education for TransUnion's TrueCredit.com, a credit monitoring service.

The first step recent college graduates should take is to get a full picture of their credit history. Contact the three nationwide credit reporting agencies - Equifax Inc., Experian Information Solutions Inc. and TransUnion LLC - just to see if anything has been reported. For a good credit standing, you should have a FICO score of 680 or higher, according to Duni. Young graduates might be surprised that they may have some credit standing because of a utility bill in their names, Duni said.

Once you confirm what's on your credit report, here are some steps to build creditworthiness:




  • Open a bank account, but don't overdraw your account. Bank accounts don't appear on credit reports, but how you manage your savings or checking accounts gives you more credibility to lenders.

  • Apply for department store or gas credit cards. These credit lines are easier to qualify for than a major credit card, said Susan Keating, president and CEO of the National Foundation for Credit Counseling, a nonprofit credit counseling organization.

    But make sure they report to a national credit bureau.

    At the same time, experts also warn not to apply to too many cards all at once. Duni estimated that every inquiry drops your credit score by about 5 points, as lenders think you're desperately seeking financing. And stay away from any cards with exorbitant fees or interest rates.

  • Once you have the credit cards, make sure you use them responsibly. Keating encourages recent graduates to stay within 30 percent of a credit card limit. And pay on time.

  • If you get turned down for a credit card, experts recommend applying for a secured credit card, which requires you to put down a deposit, usually between $200 and $250 with your application, according to Bankrate.com, an online publisher of bank and credit card information. The big disadvantage is that many of these secured cards have high interest rates and annual fees, according to Bankrate.com.

  • http://www.heraldnet.com/article/20070729/BIZ/707290336/1005

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    Saturday, July 28, 2007

    More Disclosure on Credit-Card Statements


    To make sure you understand your credit-card issuers' fees and terms, the Federal Reserve Board has proposed a number of changes to its Regulation Z, which governs the look and content of credit-card solicitations and monthly statements.

    The proposed changes would require that credit-card companies give 45 days' notice, not just 15, before increasing your interest rate or changing terms. Issuers would have to disclose how long it takes to pay off a balance if you make only the minimum payment. The term "fixed rate" would be banned unless the rate really may not increase under any circumstances or the information that you receive spells out how long the rate is in effect.

    Issuers would have to include a box on your statement that spells out what actions could trigger a penalty, the changes in rates and balances that would apply, and when the penalty rate would expire. The rules would also require a new disclosure that explains to consumers what they'll really pay when they carry over a balance to a card with a low, introductory rate and then make purchases on the new card.

    Consumer groups believe that these disclosures are inadequate and that Congress needs to address what they consider the biggest abuses. Travis Plunkett, a spokesman for the Consumer Federation of America explains, "Although these changes improve the information that companies must provide, it will take legislation to deal with the explosion of fees and the practice of charging higher rates retroactively."

    The new regulations are up for comment until September 23. To comment yourself or read others' submissions, go to the Federal Reserve's Web site.

    Issuers would have to include a box on your statement that spells out what actions could trigger a penalty, the changes in rates and balances that would apply, and when the penalty rate would expire. The rules would also require a new disclosure that explains to consumers what they'll really pay when they carry over a balance to a card with a low, introductory rate and then make purchases on the new card.

    Consumer groups believe that these disclosures are inadequate and that Congress needs to address what they consider the biggest abuses. Travis Plunkett, a spokesman for the Consumer Federation of America explains, "Although these changes improve the information that companies must provide, it will take legislation to deal with the explosion of fees and the practice of charging higher rates retroactively."

    The new regulations are up for comment until September 23. To comment yourself or read others' submissions, go to the Federal Reserve's Web site.


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    10 Commandments of Personal Finance

    By Jeffrey Strain
    Special to TheStreet.com

    For some people, getting personal finances in order is more grueling than wandering the desert for 40 years.

    But it doesn't take a miracle. If you are looking for some basic guidelines, just follow these 10 commandments:

    1. Thou Shalt Take Action

    Reading about how to improve your personal finances is a start, but it has absolutely no meaning if you don't take the action of putting what you learn into motion. Before you can get anywhere with your personal finances, you need to begin -- right now. If you are reading this article, you know that you should be taking steps to get your personal finances in order.

    Print out this list and place it where you will see it every day, so that you are reminded that personal finance is a priority in your life and that you will take some action each and every day to try to improve your lot. If you aren't sure where to begin, start with getting your banking accounts in order.

    2. Thou Shalt Pay Off All Credit Card Debt

    Credit card debt is, in most cases, the No. 1 enemy to your personal finances. It can have a huge negative effect if your credit card bills are not paid off in full every single month.

    Sit down and work out a plan to pay off any credit card debt that you currently have, using the snowball method that best fits your personality. Make this a top priority.

    3. Thou Shalt Understand the Difference Between Wants and Needs

    To keep your personal finances in perspective, you need to understand the difference between wants and needs. There is nothing inherently wrong with small luxuries, and you should be able to enjoy many of the nonessential things you have. But it is important to realize that wants are not needs. If you master this skill, your finances will be in much better shape.

    Take some time to critically look at your true needs vs. your wants. If you are having trouble distinguishing these, set up a plan to eliminate impulse spending.

    4. Thou Shalt Live on Less Than You Earn

    There are no two ways around this one. If you want to keep your personal finances in order, you need to live on less money than you make. That means either purchasing items and services that are less than you currently make, or figuring out a way to increase your salary so that you can spend more, but still less than you make. Either of these is perfectly fine.

    Track your spending to see if it is more or less than you are earning each month, and create a budget so that you can continue to track it in the future. If you are spending more than you make, you need to decide whether to curb unnecessary costs or figure out how to increase your income. Most people can balance their budget without changing their current lifestyle.

    5. Thou Shalt Pay Yourself First

    Before you pay any of your other bills, you should pay yourself a minimum of 10% of your take-home pay. This money is not part of your monthly spending budget.

    Go to your bank and set it up so that your paycheck is automatically deposited, if possible. Then set it up so that an automatic payment is immediately taken from your paycheck into a specified account that is not used for your monthly expenses.

    6. Thou Shalt Set Financial Goals

    In order to reach your financial goals, you need to know what those goals are. Nobody can determine these goals except for you. You need to take the time to figure out exactly what your financial goals are so that you can take the needed steps to reach them.

    If you don't know specifically what you financial goals are for this year, next year and 10 years from now, take the steps needed to create them.

    7. Thou Shalt Educate Yourself and Be Responsible for Your Decisions

    While it may be more convenient to hand over all your money matters to somebody else, you will not do this. Part of being financially responsible is having the final say in all decisions about your money. That does not mean that you can't seek out advice and get opinions on your finances, but in the end your money is your responsibility, and you are the only one who is going to truly look after your own interests.

    If you have designated someone else to take care of your finances, begin to take back control. No matter what, spend an hour or two each week reading articles on personal finance subjects or visiting Web communities where you can ask questions.

    8. Thou Shalt Save and Invest

    Take the money that you pay yourself first and either save or invest it to make it grow and work for you in the future.

    If you are carrying credit card debt, invest in it first. But also make sure to take full advantage of the saving and investing opportunities that are available. If your company matches 401(k) contributions, contribute up to the match and try to maximize your Roth IRA contribution. Make sure you have an emergency fund.

    9. Thou Shalt Protect Your Finances

    You will take the necessary steps, usually through insurance, to make sure that your assets are protected in case of a disaster.

    Take the time to make sure that all your assets are properly insured, and re-evaluate this every few years or whenever a major life change occurs, such as marriage or a new addition to the family. Also be sure to compare insurance rates on a regular basis, since this is a competitive business.

    10. Thou Shalt Donate to Worthy Causes and Those Less Fortunate

    No matter how desperate your finances may appear, if you are reading this article there are a lot of people that are far worse off than you are in the world. It's important to nurture a sense of giving and to be thankful for the small things that you do have. That means donating to worthy causes on a regular basis.

    Find a few causes that you believe in, and give to them generously. Don't assume that money is the only way that you can give. Volunteering time and skills are also appreciated by most charitable organizations. You can research organizations at Web sites such as Charity Watch. If you don't know where to begin, three that you may want to consider are Kiva, Modest Needs and Doctors Without Borders.

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    Getting Started: The Financial Guide For A Younger Generation

    By Amy L. Fontinelle

    If you visit this website regularly, you probably aren’t a novice to the basics of personal finance. You’re already familiar with what you need to do to retire, how to protect yourself through insurance, and what constitutes good debt versus bad debt.

    There’s probably at least one person in your life, however, who hasn’t started doing their own financial planning yet, and that’s where this book comes in handy. If you know folks in their twenties or early thirties who are clueless about money but might be ready to change that, Getting Started: The Financial Guide For A Younger Generation would make a great gift.

    This book’s main strength is that it is easy to understand and a fast read. Its 178 pages are divided into ten chapters covering subjects like debt, real estate, and retirement planning. Each chapter has sidebars that give real life examples of both how to manage your money well and how to completely mismanage it (it’s always better to learn from other people’s mistakes instead of making them yourself). The book doesn’t overwhelm the reader with information, but it doesn’t leave any subject out, either — even subjects that young folks don’t think they need to know about yet, like estate planning. It also addresses topics that I don’t always see addressed in personal finance books or on blogs, like the effects of marriage, kids, or divorce on your finances. These events certainly have a major effect on your money and it makes a lot of sense to cover them in a book targeted towards young twenty and thirty-somethings.

    The book does have a few weaknesses. Since it is really just a quick introduction to the subject of personal finance, anyone who is sparked into action by reading it will probably need to pick up another personal finance primer or two to get more detailed information on the steps they’ll need to take (I always recommend The Only Investment Guide You’ll Ever Need by Andrew Tobias and The Secrets of Wealth by Fabio Marciano). Also, there were a couple of points in the book where I thought, “if I were a novice, I would have no idea what he was talking about right now.” Those moments were brief though and didn’t interfere with the overall simplicity of the book. At a couple of points, the book oversimplifies an issue. For example, in the first chapter, the author lists six ways to increase cash flow. Most of them make a lot of sense: don’t start spending more every time you start making more, learn to cook instead of eating out all the time, and set limits on your annual vacation costs. But second on his list is to use coupons. Those of us who are in the know realize the coupons are often a waste of money because the store brand is cheaper or the coupons are for something we wouldn’t normally buy. I suppose this is a minor quibble, but I point it out because I think there are a couple of areas where the book has good intentions but doesn’t give the best advice (not that the advice is really bad, just that it could be better).

    Despite a couple of imperfections, I would still highly recommend this book. It should be required reading for any college senior or other young person who is about to enter the world of supporting oneself. I think it offers something that other personal finance primers out there do not offer by being short and sweet. It doesn’t talk down to the reader and it isn’t boring. Getting Started offers just enough information to get a newbie to begin making the right decisions about money and taking those first steps to getting everything in order.

    http://www.savingadvice.com/blog/2007/07/27/101647_getting-started-the-financial-guide-for-a-younger-generation.html



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    Three Essential Personal Finance Tips

    Connie Barker
    Personal finance is extremely important in today’s society. Whether you are looking to purchase a new home, pay for college or take a trip of a lifetime, personal finance can help you achieve these goals. While there are many ways to benefit from good money management, here are three essential personal finance tips that can truly help you achieve your goals.

    Save and Invest

    It is absolutely essential that you save as much money as possible and then invest it so that it can work hard for you. Saving money is vital to having a nest egg in the future for the purchases you desire. Saving requires a plan and usually lots of time. One of things that you should do once you receive your paycheck is to pay yourself first. Take a set amount of your pay check and put it away. Once you have money saved, the next step is to invest it and make it work hard for you. Over the years, you can earn hundreds of thousands of dollars off of just $30K to 50K in savings using the power of compound interest. There is no magic involved. In order to create a nest egg in 10, 20 or 30 years save money and invest it.

    Create a Budget

    Creating a budget is essential for anyone that has an income and expenses. Many of us are usually carefree and do not keep a record of all our purchases, however if we knew just how much we spent each year on junk or impulse purchases we would be aghast. Creating a budget is a great way to understand what we spend our income on, reduce spending on non essential items and discipline ourselves to save and invest our money for the long term. Creating a budget is extremely simple and requires only a few hours of time each month. A simple budget can literally save you thousands of dollars a year and give you true piece of mind.

    Use Credit Wisely

    Credit cards can be extremely convenient, but many times they are equally destructive. A credit card is not a license to spend; it is in effect a loan. Understanding how credit works and how to use it responsibly can make your life much easier. Credit cards can be a great option in certain situations, however using them properly is essential to proper money management.

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    Connie Barker is the owner of several financial websites including those dealing with Personal Finance

    http://www.arcamax.com/consumernews/s-212973-125791?source=1930

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    Thursday, July 26, 2007

    Use Virtual Credit Cards

    Millions of Americans are the victims of credit card fraud every year. A fifth of these people blame the internet. In fact, the top reason people shy away from internet shopping is the fear of theft of personal information.

    Virtual credit cards, also known as substitute credit card numbers or controlled payment numbers, have already been around almost seven years but have never caught on despite being a free and effective layer of protection.

    Here’s how they work. You sign up for the program (MBNA, Citibank, Discover and PayPal all have them.) and download their software. Enter your credit card info, and generate a new number whenever you want to make an online purchase.

    Depending on the program, the new number will be one-time use, have a small spending limit with an imminent expiration date, or will be able to be used multiple times but only with one merchant.

    Your actual account number will only be visible to you and your bank. The merchant never sees your number and can’t retain your information in his database. This way, hackers will only be able to see your temporary number, which will be useless to them.

    So, why haven’t virtual credit cards caught on? Many consumers find them to be a hassle, particularly when you’ll only be liable for at most $50 if your actual credit card is stolen. However, credit card theft can turn into full-blown identity theft when your credit card information is matched up with other information about you that is floating around on the web.

    Sound Money Tips http://soundmoneytips.com/article/41938

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    Child Care Credit



















    WXXA FOX 23 Albany - (WXXA)

    Jul. 23, 2007. 06:30 PM EST



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    9-Year-Old Sent Credit Cards Worth Thousands



















    Associated Press - (APTN)

    Jul. 24, 2007. 09:35 PM EST

    A 9-year-old in Louisiana has been offered thousands of dollars in credit cards. His mother is not happy and looking to see if her son's identity has been stolen. (July 24)


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    Investment Strategies: Dividend Based Investing



















    Bloomberg-Clip - (BLOOM-Clip)

    Jul. 25, 2007. 08:00 AM EST

    Analysis and Discussion with Kevin Shacknofsky of Alpine Management & Research; Reaction to Subprime Credit Rout; B&G Foods; Gatehouse Media; Babcock & Brown Wind Farms


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    Credit Insurance



















    WKRC CBS 12 Cincinnati - (WKRC)

    Jul. 25, 2007. 03:47 PM EST

    Man's mother-in-law was paying for unneccesary coverage


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    On the Money: Boosting Your Credit Score



















    Associated Press - (APTN)

    Jul. 25, 2007. 04:10 PM EST

    Not paying attention to your credit score can cost you a lot of money, from your credit card bills to your car loan and mortgage payments. AP Business Writer Eileen Alt Powell offers a few tips on how to improve it. (July 25)


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    Invest North Dakota



















    KXMB CBS Bismarck North D - (KXMB)

    Jul. 16, 2007. 01:01 PM EST

    Every penny counts. North Dakota teachers are learning better ways to teach this philosophy to their students this week at the University of Mary in Bismarck. Reporter Tracy Fugere has more on the Invest North Dakota Teachers Academy 2007...


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    Don't Let Subprime Loans Unravel Your Dream

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    Mortgage brokers are in Congress' sights

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    New Book on Financial Security for Women Features Chapter Authored by Michigan Insurance Company CEO, Lisa Wendt

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    ETFs Start Finding Way Into Retirement Plans

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    Schwab Managed Retirement Trust Funds(TM) Surpass $2 Billion in Assets

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    With baby boomers set to retire, Canada faces labor shortage in 10 years

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    Citi Introduces a Personal Finance Guide to Help Turn Money Messes Into Money Successes

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    Yahoo launches personal money management website

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    Northern Trust Report Confirms: Retirees Aren't Retiring

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    Millionaires Increased Charitable Donations in 2006, but Interest Appears Waning, Says Northern Trust

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