by Tatya H.P.
As you make your way towards a bunch of credit card types and offers, you may already be knowledgeable enough that there is no point in combating the 0% APR interest in your credit card. You as like the rest of the credit cardholders will typically be overjoyed to be rewarded with a 0% interest rate. Most of the times though, such credit card offer is only applicable during the introductory phase. As you get into the core of handling your credit card, you start facing interest charges for your committed transactions.
Here are valuable things to ponder on when it comes to dealing with the 0% APR on credit cards:
Do not be taken merely by the glitters of the words in print telling you about the 0% APR on the credit card that you wish to avail of. As a matter of truth, the 0% APR covers not only a specific datum but a lot other things. Basically, the 0% APR is applicable to the overall total of the interest rate on a credit card. It goes to show that you will not be charged with an interest on the first attempt of your purchase taken by credit. There is a span of time to cover the offer and as soon as it reaches the end of the duration, you will start to pay the interest rates on your transactions. Furthermore, there are those late fees that you will have to pay in the event that you exceed the lapse of the grace period.
The 0% APR is also applicable to the balance transfer deal. With the 0% APR available for the balance transfer method, you are given the chance of escaping charges as you move your existing credit accounts from other sources into the credit card that contains the 0% APR offer. In this light, you must consider the time span when the offer can be availed of. There are 0% APR plans that can only be availed for a very brief period of time. In this case, you may already be charged at about 4% interest or so.
Dig deep into the available rewards that come handy with the 0% APR. There are card issuers which grant rewards along with the availability of the 0% APR. You may be interested to spot rewards such as student cards, air miles, or business credit cards. The rewards will cover your earning of up to six points for every single dollar that gets charged to the card. As these amounts get piled up, there are cases when rebates in the form of cash or discount rates become possible.
It is relevant that you compare the credit card offers before you plunge into availing any of those in your list of choices. It will provide you with the pleasurable benefits if you take time to shop for other options before signing up for the 0% APR credit cards that you pose great enthusiasm on. You can check the great deals online to be fed with the pertinent information. But if you do not take particular significance in any of those and you will still go for the 0% APR credit card, then just be sure that you are sentient of the terms and conditions included therein. You never know what other tricks are hidden in the wordings of the contract. After all, the 0% APR can be very cunning.
Monday, January 11, 2010
"Using Personal Loans For Credit Card Debt..."
by Tatya H.P.
Credit card debt is widespread amongst the average American household and seeking ways of consolidating debt usually means utilizing the equity in ones home or seeking a personal loan to service the credit card payments. Using the equity in your home to apply for an equity home loan and directing the funds towards debt management is an excellent method for getting your house in order in regards to your finances.
A personal loan without collateral may sound inviting but rest assured any financial institution or broker is going to want a higher return for the added risk. Using the equity in ones home has become a popular form of liquidity to finance and consolidate existing credit card debt, however not without its risks. Be sure you read the fine print & beware of the risks of defaulting on any repayments when using the equity in your home for a equity home loan as you could end up losing your family home to your creditors should you fail to meet the repayments!!!
Consolidating debt for some means digging into their 401K for immediate relief to the detriment of their future well being. Immediate relief from credit card debt and the high fees and interest associated with such debts is a huge incentive for some to look for the 401K alternative. The compromise to such action is that you are forgoing future savings and security for immediate relief, but if the timing is right and you are confident of repaying the loan it certainly is a viable proposition. It is a very appealing short term debt solution which has its benefits as well as draw backs.
It is always wise to stack the advantages against the disadvantages in anything dealing with your finances and when formulating a wise debt management strategy. Any unforeseen event which can disrupt your repayment schedule could mean penalties due in the form of tax installments or the fulfillment of the principal on the borrowed loan.
Tax perks when saving with a 401K account are reduced when borrowing off your retirement, as you are reimbursing the account with after-tax dollars.
Be sure to negotiate a better interest rate on any repayments with any loan whether it be a personal or a home equity loan. The higher the interest rates, the higher the repayments, the less disposable income that is left for savings or other pleasures of life so ensure you manage your credit card debts first as they carry the highest interest rates of any form of credit.
The rate you are able to negotiate your interest will be fixed for the duration of your personal loan and you will be required to make monthly installments to service the loan which will be at a rate much lower than any credit card debt you are carrying. Undisciplined habits of making late and overdue credit card payments tends to incur extremely high fees and even higher interest rates which can become a major problem to most budgets.
A savings account allows you the luxury of redirecting resources to areas of debt which have the potential to erode ones worth very quickly if left unchecked!!! When you compare the interest rate you earn on a savings account and the cost of credit card debt it makes little sense not redirecting funds from you savings account towards servicing debts elsewhere??? Be smart and service your credit card debt before setting up any high yield savings account, you will be thankful you did in the long run.
Credit card debt is widespread amongst the average American household and seeking ways of consolidating debt usually means utilizing the equity in ones home or seeking a personal loan to service the credit card payments. Using the equity in your home to apply for an equity home loan and directing the funds towards debt management is an excellent method for getting your house in order in regards to your finances.
A personal loan without collateral may sound inviting but rest assured any financial institution or broker is going to want a higher return for the added risk. Using the equity in ones home has become a popular form of liquidity to finance and consolidate existing credit card debt, however not without its risks. Be sure you read the fine print & beware of the risks of defaulting on any repayments when using the equity in your home for a equity home loan as you could end up losing your family home to your creditors should you fail to meet the repayments!!!
Consolidating debt for some means digging into their 401K for immediate relief to the detriment of their future well being. Immediate relief from credit card debt and the high fees and interest associated with such debts is a huge incentive for some to look for the 401K alternative. The compromise to such action is that you are forgoing future savings and security for immediate relief, but if the timing is right and you are confident of repaying the loan it certainly is a viable proposition. It is a very appealing short term debt solution which has its benefits as well as draw backs.
It is always wise to stack the advantages against the disadvantages in anything dealing with your finances and when formulating a wise debt management strategy. Any unforeseen event which can disrupt your repayment schedule could mean penalties due in the form of tax installments or the fulfillment of the principal on the borrowed loan.
Tax perks when saving with a 401K account are reduced when borrowing off your retirement, as you are reimbursing the account with after-tax dollars.
Be sure to negotiate a better interest rate on any repayments with any loan whether it be a personal or a home equity loan. The higher the interest rates, the higher the repayments, the less disposable income that is left for savings or other pleasures of life so ensure you manage your credit card debts first as they carry the highest interest rates of any form of credit.
The rate you are able to negotiate your interest will be fixed for the duration of your personal loan and you will be required to make monthly installments to service the loan which will be at a rate much lower than any credit card debt you are carrying. Undisciplined habits of making late and overdue credit card payments tends to incur extremely high fees and even higher interest rates which can become a major problem to most budgets.
A savings account allows you the luxury of redirecting resources to areas of debt which have the potential to erode ones worth very quickly if left unchecked!!! When you compare the interest rate you earn on a savings account and the cost of credit card debt it makes little sense not redirecting funds from you savings account towards servicing debts elsewhere??? Be smart and service your credit card debt before setting up any high yield savings account, you will be thankful you did in the long run.
"short And Fat" Ltc Policies Beat "long And Skinny" Ones
by Tatya H.P.
Long term care insurance policies have an important component called a benefit period which greatly affectspremium costs. This article discusses what I call "Short and Fat vs. Long and Skinny LTC Policies".
That is right -- Short and Fat LTC policies! So what is a benefit period anyway?
The benefit period is the number of years that ONCE you go on claim (need help in bathing and dressing or have some cognitive impairment (Alzheimer's or similar ailment) that the insurance company will pay the daily or monthly benefit that you chose when you applied for the policy.
So if you bought a benefit period of say 5 years, once you qualified for benefits, and satisfied the deductible (how many days of care that you need to pay out of pocket), the insurance company will pay those benefits for a maximum of 5 years in this case.
The benefit period, whether a set number of years, say 6 years for example or unlimited years are the MAXIMUM amount of time, if you used your FULL chosen daily or monthly benefit that your policy would pay on a claim.
If you had Alzheimer's for 9 years, the policy benefits would have been exhausted after those 5 years and you would be paying for the last four years from your own money.
Most insurance companies have a number of benefit periods to choose from. Typically they are 2, 3, 4, 5, 6, 7, or 10 years OR an Unlimited benefit period (say you went on claim for 35 years due to being in a wheelchair or something).
Most LTC policies have at least four or five different benefits periods from the above choices which you can choose from for your policy.
The benefit period, whether a set number of years, say 4 years for example or unlimited years are the MAXIMUM amount of time, if you used your FULL chosen daily or monthly benefit that your policy would pay on a claim.
Now for the "Short and Fat" part...
Long ago there wasn't too much difference in the premium prices for a 5 year benefit period compared to an Unlimited policy. So since there wasn't much of a cost difference, many clients chose the Unlimited benefit to protect against a HUGE potential disaster of needing help in bathing/dressing, etc. for DECADES -- not just a few years.
But today, there is a much larger difference in the premium prices for unlimited. So what to do?
First of all let me say that one of the largest LTC insurance companies has statistics that show that only 11% of their claims last longer than five years. Of course this means that about 90% of the claims last shorter than five years. So the odds are very much in favor of never needing a policy that would pay unlimited years.
So compared with a policy that offers an Unlimited benefit period, you can get a much higher daily/monthly dollar benefit that you are MUCH more likely to actually use and benefit from. Any unused dollar benefits will extend the number of years of your benefit period and not be lost.
Also you are much more likely to use a higher dollar amount for 2-4 years than having to pay extra money out of your pocket during care with a benefit period that is probably never going to be reached.
But... if you are pretty young (30-55) an Unlimited policy still might be a choice to look at. Older ages will find Unlimited years of benefits very expensive and there is likely a better way to structure a policy.
So knowing the above statistics, would it make more sense to you to have a Short and Fat policy (one with a larger daily or monthly dollar benefit for a shorter period of time)verses... a smaller daily or monthly dollar benefit for a longer period of years?
I'd put my money on Short and Fat!!
So if you would normally consider a policy that pays $150 per day for 7, 10 years or an Unlimited benefit period... you MIGHT seriously consider a policy that would pay $180-$200 per day for three to five years instead.
No sense in paying money out of pocket during the 3-5 years you are most likely to remain on claim.
Keep in mind that in 20 or 30 years the compounded inflation policy rider will work in your favor by giving you much more purchasing power to pay for care by starting out with a bigger initial benefit!
The odds are pretty good that the insurance company will pay more out for your care under these conditions.
Long term care insurance policies have an important component called a benefit period which greatly affectspremium costs. This article discusses what I call "Short and Fat vs. Long and Skinny LTC Policies".
That is right -- Short and Fat LTC policies! So what is a benefit period anyway?
The benefit period is the number of years that ONCE you go on claim (need help in bathing and dressing or have some cognitive impairment (Alzheimer's or similar ailment) that the insurance company will pay the daily or monthly benefit that you chose when you applied for the policy.
So if you bought a benefit period of say 5 years, once you qualified for benefits, and satisfied the deductible (how many days of care that you need to pay out of pocket), the insurance company will pay those benefits for a maximum of 5 years in this case.
The benefit period, whether a set number of years, say 6 years for example or unlimited years are the MAXIMUM amount of time, if you used your FULL chosen daily or monthly benefit that your policy would pay on a claim.
If you had Alzheimer's for 9 years, the policy benefits would have been exhausted after those 5 years and you would be paying for the last four years from your own money.
Most insurance companies have a number of benefit periods to choose from. Typically they are 2, 3, 4, 5, 6, 7, or 10 years OR an Unlimited benefit period (say you went on claim for 35 years due to being in a wheelchair or something).
Most LTC policies have at least four or five different benefits periods from the above choices which you can choose from for your policy.
The benefit period, whether a set number of years, say 4 years for example or unlimited years are the MAXIMUM amount of time, if you used your FULL chosen daily or monthly benefit that your policy would pay on a claim.
Now for the "Short and Fat" part...
Long ago there wasn't too much difference in the premium prices for a 5 year benefit period compared to an Unlimited policy. So since there wasn't much of a cost difference, many clients chose the Unlimited benefit to protect against a HUGE potential disaster of needing help in bathing/dressing, etc. for DECADES -- not just a few years.
But today, there is a much larger difference in the premium prices for unlimited. So what to do?
First of all let me say that one of the largest LTC insurance companies has statistics that show that only 11% of their claims last longer than five years. Of course this means that about 90% of the claims last shorter than five years. So the odds are very much in favor of never needing a policy that would pay unlimited years.
So compared with a policy that offers an Unlimited benefit period, you can get a much higher daily/monthly dollar benefit that you are MUCH more likely to actually use and benefit from. Any unused dollar benefits will extend the number of years of your benefit period and not be lost.
Also you are much more likely to use a higher dollar amount for 2-4 years than having to pay extra money out of your pocket during care with a benefit period that is probably never going to be reached.
But... if you are pretty young (30-55) an Unlimited policy still might be a choice to look at. Older ages will find Unlimited years of benefits very expensive and there is likely a better way to structure a policy.
So knowing the above statistics, would it make more sense to you to have a Short and Fat policy (one with a larger daily or monthly dollar benefit for a shorter period of time)verses... a smaller daily or monthly dollar benefit for a longer period of years?
I'd put my money on Short and Fat!!
So if you would normally consider a policy that pays $150 per day for 7, 10 years or an Unlimited benefit period... you MIGHT seriously consider a policy that would pay $180-$200 per day for three to five years instead.
No sense in paying money out of pocket during the 3-5 years you are most likely to remain on claim.
Keep in mind that in 20 or 30 years the compounded inflation policy rider will work in your favor by giving you much more purchasing power to pay for care by starting out with a bigger initial benefit!
The odds are pretty good that the insurance company will pay more out for your care under these conditions.
"A Sucker Born Every Minute": Avoid These Debt Consolidation Scams
by Tatya H.P.
The web communications revolution has provided many unprecedented opportunities for commerce – and unfortunately, quite a few opportunities for swindlers to prey on the gullible. This is just as true for debt consolidation as for anything else. Here are some debt consolidation scams to stay away from:
1. “Free Debt Consolidation Services”
Why are these guys doing it for free? How are they making money? Do be aware, though, that cheap debt consolidation services are not always a rip-off, although it would be a good idea to take a second look at anything that sounds too good to be true.
2. Consolidate Your Debts Using Free Government Grants
Yeah, right. The woods are thick with companies that offer information about “free government grants”. Haven’t you heard? Uncle Sam is giving away money like candy (which explains our high taxes!). And you can use this money any way you like – for example, to consolidate your debts. It’s true that the government gives loads of grant money, but I have yet to hear of a Citizen Lifestyle Enhancement Fund. It’s not easy to qualify for government grants, you have to spend the money for a particular purpose, and using it to consolidate your bills might just win you a free bonus – a five-year vacation at the Club Fed.
3. “No Repayment Necessary”
I don’t quite know quite why I included this one, except for entertainment value – if you can read then you’re probably too smart to fall for it. Anyway, here goes: Did you know that banking laws prohibit the charging of interest, and that the Supreme Court has backed this up with several decisions? You can borrow money, fail to pay it back, and then retain a smooth attorney to get you out of paying it back – after all, they had no legal right to lend you the money. Would you like to know how? Well, for the low, low price of $69.95…
If you fall for this one then I’ve got some swampland in Florida I’d like to sell you sight unseen. Oh, and by the way, even if banking law DID prohibit the charging of interest, you’d still have to pay back the principal.
Most debt consolidation swindles are see-through because they aim to take advantage of somebody in financial and emotional distress. As P.T. Barnum said, “There’s a sucker born every minute”.
The web communications revolution has provided many unprecedented opportunities for commerce – and unfortunately, quite a few opportunities for swindlers to prey on the gullible. This is just as true for debt consolidation as for anything else. Here are some debt consolidation scams to stay away from:
1. “Free Debt Consolidation Services”
Why are these guys doing it for free? How are they making money? Do be aware, though, that cheap debt consolidation services are not always a rip-off, although it would be a good idea to take a second look at anything that sounds too good to be true.
2. Consolidate Your Debts Using Free Government Grants
Yeah, right. The woods are thick with companies that offer information about “free government grants”. Haven’t you heard? Uncle Sam is giving away money like candy (which explains our high taxes!). And you can use this money any way you like – for example, to consolidate your debts. It’s true that the government gives loads of grant money, but I have yet to hear of a Citizen Lifestyle Enhancement Fund. It’s not easy to qualify for government grants, you have to spend the money for a particular purpose, and using it to consolidate your bills might just win you a free bonus – a five-year vacation at the Club Fed.
3. “No Repayment Necessary”
I don’t quite know quite why I included this one, except for entertainment value – if you can read then you’re probably too smart to fall for it. Anyway, here goes: Did you know that banking laws prohibit the charging of interest, and that the Supreme Court has backed this up with several decisions? You can borrow money, fail to pay it back, and then retain a smooth attorney to get you out of paying it back – after all, they had no legal right to lend you the money. Would you like to know how? Well, for the low, low price of $69.95…
If you fall for this one then I’ve got some swampland in Florida I’d like to sell you sight unseen. Oh, and by the way, even if banking law DID prohibit the charging of interest, you’d still have to pay back the principal.
Most debt consolidation swindles are see-through because they aim to take advantage of somebody in financial and emotional distress. As P.T. Barnum said, “There’s a sucker born every minute”.
Sunday, January 10, 2010
$82,000 Penalty Tag For Bad Credit Mortgage
by Tatya H.P.
It is natural for people to ask for help when they are in trouble and it is within our nature to offer a hand when we can. What throws this natural human relationship off its kilter is our ego that impacts our decision as to when we ask for help and when to extend a hand.
We often wait until we are in serious trouble before we ask for help and by that time the kind of help we receive is very very expensive and sometimes too late. On the other hand when we offer a hand too soon, we come across as interfering busy bodies who do not know the first thing about free will. Parents know what this is like when they talk to their children. But we leave the eagerness to help alone for now and concentrate on asking for help too late.
Let’s take the term "bad credit loan" for instance. According to a segment of Yahoo that keeps track of what people search for, in December of 2006 over 100,000 people searched for bad credit loan. On the other hand a little shy of 5,000 people looked for the term "bad credit repair."
When I added all the people that were looking for various loans related to bad credit, the number was over 500,000. But the number of individuals who looked for bad credit repair still remained under 5,000.
This seems to mean only 1 out of every 100 person look to cure the problem and the rest look to cure the symptom.
Wouldn't you think that the "bad credit" problem arises much before the need to get a "bad credit loan?" If this was the case, more people should have been searching for ways to repair their credit than those who seek to remedy the bad credit problem with a loan.
We as a society seem to seek remedy more than prevention. We live the dream of buy now and pay later and it is costing us dearly. Let’s look at two other examples of “bad credit mortgage” and “bad credit home loan.” 79,000 individuals looked for these services in December of 2006.
According to Fair Isaac Corporation as of January 11, 2006 and on a national basis, a person with a poor credit score of 500 – 579 is expected to pay $819 for a $100,000 thirty year fixed bad credit mortgage loan. For the same loan amount a person with an excellent credit score of 760-850 expects to pay $589 per month. That is $230 per month difference. This difference amounts to an $82,000 penalty tag for a bad credit mortgage loan.
The amazing part is that there is help in form of books, tapes, ebooks, firms and so on and it costs much much less. But when you look at the numbers most people chafe at $30, $50 or $100 one time fee but they flock to get solutions that cost them hundreds of dollars per month for a very long time.
You have these numbers, you know your situations, likes and dislikes better than any one else. I hope that you are reading this article and do not have to deal with bad credit. But if you are, consider placing some of your attention on bad credit repair and don’t let obtaining a bad credit mortgage loan consume all your attention.
William F. Halsey once said, “All problems become smaller if you don’t dodge them, but confront them.
It is natural for people to ask for help when they are in trouble and it is within our nature to offer a hand when we can. What throws this natural human relationship off its kilter is our ego that impacts our decision as to when we ask for help and when to extend a hand.
We often wait until we are in serious trouble before we ask for help and by that time the kind of help we receive is very very expensive and sometimes too late. On the other hand when we offer a hand too soon, we come across as interfering busy bodies who do not know the first thing about free will. Parents know what this is like when they talk to their children. But we leave the eagerness to help alone for now and concentrate on asking for help too late.
Let’s take the term "bad credit loan" for instance. According to a segment of Yahoo that keeps track of what people search for, in December of 2006 over 100,000 people searched for bad credit loan. On the other hand a little shy of 5,000 people looked for the term "bad credit repair."
When I added all the people that were looking for various loans related to bad credit, the number was over 500,000. But the number of individuals who looked for bad credit repair still remained under 5,000.
This seems to mean only 1 out of every 100 person look to cure the problem and the rest look to cure the symptom.
Wouldn't you think that the "bad credit" problem arises much before the need to get a "bad credit loan?" If this was the case, more people should have been searching for ways to repair their credit than those who seek to remedy the bad credit problem with a loan.
We as a society seem to seek remedy more than prevention. We live the dream of buy now and pay later and it is costing us dearly. Let’s look at two other examples of “bad credit mortgage” and “bad credit home loan.” 79,000 individuals looked for these services in December of 2006.
According to Fair Isaac Corporation as of January 11, 2006 and on a national basis, a person with a poor credit score of 500 – 579 is expected to pay $819 for a $100,000 thirty year fixed bad credit mortgage loan. For the same loan amount a person with an excellent credit score of 760-850 expects to pay $589 per month. That is $230 per month difference. This difference amounts to an $82,000 penalty tag for a bad credit mortgage loan.
The amazing part is that there is help in form of books, tapes, ebooks, firms and so on and it costs much much less. But when you look at the numbers most people chafe at $30, $50 or $100 one time fee but they flock to get solutions that cost them hundreds of dollars per month for a very long time.
You have these numbers, you know your situations, likes and dislikes better than any one else. I hope that you are reading this article and do not have to deal with bad credit. But if you are, consider placing some of your attention on bad credit repair and don’t let obtaining a bad credit mortgage loan consume all your attention.
William F. Halsey once said, “All problems become smaller if you don’t dodge them, but confront them.
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