Now days, people use multiple credit cards for all their needs be it shopping, paying bills etc. But generally credit cards carry very high interest rate, due to which it become difficult for an individual to manage all your debts efficiently and economically. Personal debt management is approved very easily and carries nominal charges.
BASIC INFORMATION ON PERSONAL DEBT MANAGEMENT
There are many banks, financial institutions and lending firms that offer personal debt management. Personal debt management helps you to consolidate all your debts into one. This way you have to pay only one monthly installment instead of many. Also it helps you to get rid of nagging calls of your creditors. With debt consolidation you will be accountable to only one lender instead of many. If you are having many credit cards all with high interest rate, you can merge all of them into one credit card with zero or very low interest rate with the help of personal debt management. Personal debt management can also be availed by people suffering from bad credit status due to arrears, defaults, CCJ, IVA, bankruptcy etc.
PERSONAL DEBT MANAGEMENT: FEATURES
Personal debt management is a broad term used for many services. These are:
1. Debt consolidation- The Company that offers you personal debt management will merge all your existing debts into one debt with lower interest rate.
2. Counseling- Financial experts on behalf of lender advice you regarding ways to improve your credit status, saving money, expenditure control etc. They also help you to avail a loan that is suitable for your needs.
3. Negotiation with creditors- Your lender will negotiate with your previous creditors to lower the interest rate of your debts on your behalf.
WHY OPT FOR PERSONAL BEDT MANAMGEMENT
Personal debt management helps you to manage all your debts efficiently. It helps you merge all your debts into one debt with lower interest rate. This way you have to pay smaller monthly installments. Also you will be answerable to one lender instead of many. There are many banks, financial institutions and lending firms that offer personal debt management at nominal charges. Personal debt management can be availed online also. For this you just need to fill up an online application form with details, like your debt and financial details, contact details etc. You can search for various companies that offer personal debt management with the help of internet. Personal debt management helps you to get rid of your debts and lead a free life.
Wednesday, May 30, 2007
Platinum Credit Cards Are What You Want To Have
Beyond the sex-appeal of the card itself, a platinum card often has a much higher credit limit than your run-of-the-mill card and obtaining one is not always as easy as obtaining the lower level credit cards. Most companies require applicants to have a good credit score to receive the platinum credit card since platinum credit cards offer benefits above that of other credit cards. The credit score requirement is related to the amount of credit the card issuer gives with the platinum credit card. Since the credit limit on a platinum credit card is higher than most cards, the card issuer must have some assurance that the cardholder will pay the balance in a timely manner. Platinum credit cards have far more benefits and features compared to a standard or gold credit card and platinum credit cards usually have a lower interest rate than regular and even gold credit cards. Once you have shown credit card companies that you have the ability to pay your bills and you are not a risk, they just might offer you a platinum credit card. As long as you pay the bills on time and build your credit then you may be offered a platinum card in as little as three months. Platinum cardholders work their way up the ranks by paying and establishing better credit for themselves.
So what makes a platinum credit card different from others? When you use a platinum credit card for shopping or any other transaction, you are awarded reward points depending on the amount of the transaction. Generally, one gets a reward point for each dollar spent through the use of credit card. Unlike the regular credit cards, platinum credit card offers you a fixed rate. The other advantages of for the platinum credit card holder include rental car insurance, travel accident insurance, etc. Some of the great advantages that may be associated with platinum credit cards are: as mentioned before, lower interest rates, plus higher credit limits, more frequent credit limit increases, no annual fee, more benefits, savings and rewards, including: fraud protection service, cash back programs, and frequent flier miles. These credit cards offer such great rewards because credit issuers are trying to cater to people with excellent credit.
Platinum credit cards are usually advertised through television or newspapers, direct mail or telephone solicitations. The rules for offering platinum credit card vary from company to company. If a credit card company sees that you have outstanding credit, they are going to want to keep your business, which is why so many companies offer platinum credit cards, to set you apart from the people with just good credit. A company offering you a platinum credit card is there way of rewarding you for having great credit, while at the same time trying to attract, or maintain your business. In nearly all cases, platinum credit cards are offered to those consumers who use their credit card to make a relatively large amount of purchases. A platinum credit card can be a good choice if you frequently use your credit card for your routine and high purchases and pay back the whole debt at the month end. The low interest rate is a reward to platinum customers for the amount of purchases they make using the platinum credit card. One of the best ways to get the platinum credit is to search for it on the internet. Students usually do not have platinum credit cards because they do not have excellent credit, nor do they often own homes or other larger assets with which credit might be built.
A platinum card can be a wonderful financial tool for managing you daily spending. With low interest rates, great benefits and high credit limits, the appeal of platinum cards make them very desirable to the vast majority of credit card holders. You may or may not currently have a platinum card, if you do not, consider getting one. If you do have a platinum card, maybe you should select another one or two
So what makes a platinum credit card different from others? When you use a platinum credit card for shopping or any other transaction, you are awarded reward points depending on the amount of the transaction. Generally, one gets a reward point for each dollar spent through the use of credit card. Unlike the regular credit cards, platinum credit card offers you a fixed rate. The other advantages of for the platinum credit card holder include rental car insurance, travel accident insurance, etc. Some of the great advantages that may be associated with platinum credit cards are: as mentioned before, lower interest rates, plus higher credit limits, more frequent credit limit increases, no annual fee, more benefits, savings and rewards, including: fraud protection service, cash back programs, and frequent flier miles. These credit cards offer such great rewards because credit issuers are trying to cater to people with excellent credit.
Platinum credit cards are usually advertised through television or newspapers, direct mail or telephone solicitations. The rules for offering platinum credit card vary from company to company. If a credit card company sees that you have outstanding credit, they are going to want to keep your business, which is why so many companies offer platinum credit cards, to set you apart from the people with just good credit. A company offering you a platinum credit card is there way of rewarding you for having great credit, while at the same time trying to attract, or maintain your business. In nearly all cases, platinum credit cards are offered to those consumers who use their credit card to make a relatively large amount of purchases. A platinum credit card can be a good choice if you frequently use your credit card for your routine and high purchases and pay back the whole debt at the month end. The low interest rate is a reward to platinum customers for the amount of purchases they make using the platinum credit card. One of the best ways to get the platinum credit is to search for it on the internet. Students usually do not have platinum credit cards because they do not have excellent credit, nor do they often own homes or other larger assets with which credit might be built.
A platinum card can be a wonderful financial tool for managing you daily spending. With low interest rates, great benefits and high credit limits, the appeal of platinum cards make them very desirable to the vast majority of credit card holders. You may or may not currently have a platinum card, if you do not, consider getting one. If you do have a platinum card, maybe you should select another one or two
Stressed With Credit Card Collection Agency's Calls? Stop Things From Getting Worse With 5 Tips
Credit card agencies when find excessive default in repayments and debt burden increasing with their client, refer the matter to a credit collection agency. This agency specializes in recovering debts. The usual process is that the credit collection agency starts calling you about the debt and its recovery. Many people simply run away from such calls. But, this is certainly not the right way to tackle the situation. This article takes a look at simple steps that can save things from getting worse.
1. Don't avoid the credit collection agencies call. Respond to them and make sure they get the message that you intend to pay your debts.
2. Be polite in conversation with the credit collection agencies. Don't let things slip out of hands, and don't let them dominate things. If they abuse you tell them politely but in firm words that this is improper behavior and since you are co-operating with them in debt repayment rude things are not required.
3. Explain your situation clearly to the credit collection agency, what caused the debt, whether it was an emergency situation that took things out of hand or anything else. Tell them clearly and mention your existing financial situation. Ask them to lower interest rates, or provide all the help they can offer.
4. If you are waiting for any positive outcome in near future that could ease the debt burden, inform the credit collection agency about it. It could be a salary raise, some bonus, or any other monetary gain. When the credit rating agencies know it, they will certainly consider it.
5. If involved with a wrong agency which is not relenting in any way, tell them that you are going for a credit counseling and contact some reputable company which can get you out of the situation.
1. Don't avoid the credit collection agencies call. Respond to them and make sure they get the message that you intend to pay your debts.
2. Be polite in conversation with the credit collection agencies. Don't let things slip out of hands, and don't let them dominate things. If they abuse you tell them politely but in firm words that this is improper behavior and since you are co-operating with them in debt repayment rude things are not required.
3. Explain your situation clearly to the credit collection agency, what caused the debt, whether it was an emergency situation that took things out of hand or anything else. Tell them clearly and mention your existing financial situation. Ask them to lower interest rates, or provide all the help they can offer.
4. If you are waiting for any positive outcome in near future that could ease the debt burden, inform the credit collection agency about it. It could be a salary raise, some bonus, or any other monetary gain. When the credit rating agencies know it, they will certainly consider it.
5. If involved with a wrong agency which is not relenting in any way, tell them that you are going for a credit counseling and contact some reputable company which can get you out of the situation.
5 Small Mistakes That Cause Big Damage To A Person's Credit History
Credit history and credit score if good can get us good loans and credit cards at better terms. We make a lot of efforts to remain in good books of credit rating agencies. But little things such as those listed in this article if not taken care can do serious damage to a person's credit history. Make sure you don't make these mistakes.
1. Not checking credit reports for wrong credit card charges can land you in serious trouble, and adversely affect your credit score. All this for only a simple fault that you didn't keep track of your expenses, false charges increased your monthly credit card bills, which you weren't able to repay and got a negative mark in credit report. Isn't that silly?
2. Procrastination, while paying bills ensures negative remarks in credit history. It's the credit cards with big outstanding balances which will hurt you the most in terms of interest rates, and if you keep on paying for credit cards with low balances and ignoring the bigger ones, you are doomed.
3. On a big buying spree you exhaust your credit card limits and max out. What will it do to your credit report? Simple, you will get a negative remark. Try spending less than 30% of your credit card limit and, it will keep you in good books of credit rating agencies. Go overboard, and there are penalties to be paid.
4. When you stay with a credit card for long and keep the accounts in good health it helps a lot in terms of building good credit history. Don't ever cancel that credit card, it will wipe out all the goodness. Remember old is gold. Cancelling new credit cards doesn't hurt much on credit history but doing that to an old credit card will invite a backlash.
1. Not checking credit reports for wrong credit card charges can land you in serious trouble, and adversely affect your credit score. All this for only a simple fault that you didn't keep track of your expenses, false charges increased your monthly credit card bills, which you weren't able to repay and got a negative mark in credit report. Isn't that silly?
2. Procrastination, while paying bills ensures negative remarks in credit history. It's the credit cards with big outstanding balances which will hurt you the most in terms of interest rates, and if you keep on paying for credit cards with low balances and ignoring the bigger ones, you are doomed.
3. On a big buying spree you exhaust your credit card limits and max out. What will it do to your credit report? Simple, you will get a negative remark. Try spending less than 30% of your credit card limit and, it will keep you in good books of credit rating agencies. Go overboard, and there are penalties to be paid.
4. When you stay with a credit card for long and keep the accounts in good health it helps a lot in terms of building good credit history. Don't ever cancel that credit card, it will wipe out all the goodness. Remember old is gold. Cancelling new credit cards doesn't hurt much on credit history but doing that to an old credit card will invite a backlash.
Things To Watch Out While Applying For Chase Platinum Visa Credit Card
Looking for a credit card with excellent reward program, and reasonable terms? The Chase Platinum Visa Credit Card has all the features to bowl you over. However, to get the maximum out of your Chase Platinum Visa Credit Card there are certain things to be kept in mind. Let us look at a few of them.
The Chase Platinum Visa Credit Card issued by J.P Morgan Chase has no annual fee and provides a good number of platinum card holder benefits. The card comes with a 0% intro APR for up to 12 months. The thing to be kept in mind regarding this APR is that the introductory rate period will largely depend on your review of application and credit history by chase. Depending on this assessment the introductory period can be either 12 months for purchases and balance transfers or 3 months for balance transfers only. In addition to this to get full benefit of 0% intro APR it is vital that terms and conditions listed with the Chase Platinum Visa Credit Card be followed carefully. These terms can greatly vary how your introductory rate is applied to existing balances. If you are good on your repayments and pay your balances in full before the due date the Chase Platinum Visa Credit Card doesn't charge you any interest.
The platinum benefits that come with Chase Platinum Visa Credit Card allow participation in chase fleixble rewards program. In this program cardholders can earn 1 point per eligible dollar spent. These points can be redeemed for gift cards, travel discounts, merchandise or cashback. The thing to watchout about the Chase Platinum Visa Credit Card reward program is that the reward points are not earned on fees for products that protect or insure the balances of the card member's account. If you use a travel agency service, you have to pay a 'mileage redemption' fee of $14.95.
The reward program of Chase Platinum Visa Credit Card has many fare and space related restrictions. The flights must be booked 21 days in advance and there are tabs on saturday night stays. The Chase Platinum Visa Credit Card doesn't allow the reward programs to be transferred to another frequent flyer programs and there are prefferecd choice of carriers like Continental, Northwest, U.S. Airways, American, Delta, United, and other airways.
If accepted for the Chase Platinum Visa Credit Card, a detailed copy of terms and conditions will be mailed to you. It is in the best interest of credit card holder to read it carefully before using the credit card. Once used, the credit card company assumes acceptance of all such terms and the cardholder becomes legally bound with the terms and conditions
The Chase Platinum Visa Credit Card issued by J.P Morgan Chase has no annual fee and provides a good number of platinum card holder benefits. The card comes with a 0% intro APR for up to 12 months. The thing to be kept in mind regarding this APR is that the introductory rate period will largely depend on your review of application and credit history by chase. Depending on this assessment the introductory period can be either 12 months for purchases and balance transfers or 3 months for balance transfers only. In addition to this to get full benefit of 0% intro APR it is vital that terms and conditions listed with the Chase Platinum Visa Credit Card be followed carefully. These terms can greatly vary how your introductory rate is applied to existing balances. If you are good on your repayments and pay your balances in full before the due date the Chase Platinum Visa Credit Card doesn't charge you any interest.
The platinum benefits that come with Chase Platinum Visa Credit Card allow participation in chase fleixble rewards program. In this program cardholders can earn 1 point per eligible dollar spent. These points can be redeemed for gift cards, travel discounts, merchandise or cashback. The thing to watchout about the Chase Platinum Visa Credit Card reward program is that the reward points are not earned on fees for products that protect or insure the balances of the card member's account. If you use a travel agency service, you have to pay a 'mileage redemption' fee of $14.95.
The reward program of Chase Platinum Visa Credit Card has many fare and space related restrictions. The flights must be booked 21 days in advance and there are tabs on saturday night stays. The Chase Platinum Visa Credit Card doesn't allow the reward programs to be transferred to another frequent flyer programs and there are prefferecd choice of carriers like Continental, Northwest, U.S. Airways, American, Delta, United, and other airways.
If accepted for the Chase Platinum Visa Credit Card, a detailed copy of terms and conditions will be mailed to you. It is in the best interest of credit card holder to read it carefully before using the credit card. Once used, the credit card company assumes acceptance of all such terms and the cardholder becomes legally bound with the terms and conditions
Cash Advance Store - Easy to Find
Finding a cash advance store has never been easier to do online. When emergency strikes and finds you short of cash, an online cash advance store can provide simple solution by lending you some money without many requirements. A cash advance store is an online place for you to get that extra cash to bide you over till the next payday.
Most of us have cash problems in the last few days of the month. But that’s okay with us. It’s when you have a serious cash crunch, and face a crisis, that you need help from a cash advance store. Of course, you can still ask your friends or relatives to lend you some money. But that will require an approach that may disturb your relationship them. Getting a loan from a cash advance store is confidential without involving many people.
Bad Credit is OK
More and more people are opting for services of cash advance stores as compared to credit cards. The reason is very simple. Most of these cash advance stores do not bother with credit ratings. This means that even if you have a poor rating, you can still apply for a cash advance and get money to tidy over the crisis you face.
Requirements for Cash Advance
The requirements of getting an advance until next payday from a cash advance store are very simple.
• You have to be at least eighteen years old.
• You also need a steady job that brings a steady inflow of cash.
• You need a savings/checking account for the loan deposit to be made.
If it’s the first time that you are applying for a cash advance, it is unlikely that the cash advance store will give you a loan of more than $250. But after you have repaid your first loan, it will be a different story if you return for more.
Before You Apply
Even though the cash advance stores have brought ready cash to your fingertips, these services should be used sparingly. If you start using cash advance for petty day-to-day expenses, you are likely to fall into a debt trap that will be difficult to get out of. So use the loan only when you are in emergency and always borrow at the amount that you can repay.
Most of us have cash problems in the last few days of the month. But that’s okay with us. It’s when you have a serious cash crunch, and face a crisis, that you need help from a cash advance store. Of course, you can still ask your friends or relatives to lend you some money. But that will require an approach that may disturb your relationship them. Getting a loan from a cash advance store is confidential without involving many people.
Bad Credit is OK
More and more people are opting for services of cash advance stores as compared to credit cards. The reason is very simple. Most of these cash advance stores do not bother with credit ratings. This means that even if you have a poor rating, you can still apply for a cash advance and get money to tidy over the crisis you face.
Requirements for Cash Advance
The requirements of getting an advance until next payday from a cash advance store are very simple.
• You have to be at least eighteen years old.
• You also need a steady job that brings a steady inflow of cash.
• You need a savings/checking account for the loan deposit to be made.
If it’s the first time that you are applying for a cash advance, it is unlikely that the cash advance store will give you a loan of more than $250. But after you have repaid your first loan, it will be a different story if you return for more.
Before You Apply
Even though the cash advance stores have brought ready cash to your fingertips, these services should be used sparingly. If you start using cash advance for petty day-to-day expenses, you are likely to fall into a debt trap that will be difficult to get out of. So use the loan only when you are in emergency and always borrow at the amount that you can repay.
Thursday, May 24, 2007
Low Rate Borrowings Ensured Through Cheap Personal Loans UK
The UK residents can avail personal loans at cheap rate and overall cost of borrowings also remains low. This is made possible thanks to a cut throat competition amongst the lenders. Cheap personal loans UK are especially designed loans for the UK people so that they get a personal loan at cheap rates and that too without any hassles for any personal purpose like home improvements, buying a car, clearing debts, paying for holiday or wedding expenses.
Cheap personal loans for the UK residents are usually offered at cheaper interest rate on taking the borrower’s property as security. thus as the lender is now more assured of getting back the loan in time he has no major risks and so can afford to offer the loan at cheap rate. However, collateral is not the only basis. Cheap rate depends also on good credit history of the borrower. Lenders see credit score of the borrower to judge the risks in offering the loan. The less risky borrower is most likely to get the loan at lower interest rate. So it would be wise step to first check your credit score. In case credit score is not good than pay off some easy debts for improving credit score and then apply for the loan.
These days, you can find lenders who are offering cheap personal loans to the UK borrowers without taking security. Such unsecured loans are solely offered on the basis of good credit and good repaying capacity of the borrower. However, the interest rate will be a bit higher than on secured loans. Still you can get the loan at comparatively lower interest rate.
You can easily locate cheap personal loans providers in the UK. Most of such lenders are online lenders offering the loan at competitive rates. Compare their terms-conditions for a suitable deal. Online lenders do not charge fee on loan application processing and provide all help in taking the loan without cost which also makes the loan cheaper.
Cheap personal loans for the UK residents are usually offered at cheaper interest rate on taking the borrower’s property as security. thus as the lender is now more assured of getting back the loan in time he has no major risks and so can afford to offer the loan at cheap rate. However, collateral is not the only basis. Cheap rate depends also on good credit history of the borrower. Lenders see credit score of the borrower to judge the risks in offering the loan. The less risky borrower is most likely to get the loan at lower interest rate. So it would be wise step to first check your credit score. In case credit score is not good than pay off some easy debts for improving credit score and then apply for the loan.
These days, you can find lenders who are offering cheap personal loans to the UK borrowers without taking security. Such unsecured loans are solely offered on the basis of good credit and good repaying capacity of the borrower. However, the interest rate will be a bit higher than on secured loans. Still you can get the loan at comparatively lower interest rate.
You can easily locate cheap personal loans providers in the UK. Most of such lenders are online lenders offering the loan at competitive rates. Compare their terms-conditions for a suitable deal. Online lenders do not charge fee on loan application processing and provide all help in taking the loan without cost which also makes the loan cheaper.
Different Methods Of Borrowing Money
These are offered by banks, building societies and by some finance houses. They are normally for a short term of one to five years, and the interest rate is generally fixed at the outset and remains unchanged throughout the term. Many of the larger lenders operate a centralised assessment of loan applications through telephone call-centres, using a form of credit scoring to assess the suitability of the borrower.
The loan can be used for any purpose y the customer, typically they are used to purchase cars, fund holidays, or consolidate existing higher cost borrowings such as credit card balances.
The purpose of the loan determines whether it is regulated under the terms of the consumer credit act 1974. Most such loans of £25,000 or less are regulated by the act unless they are for house purchase or home improvement.
Overdrafts
An overdraft is a current account facility, offered by all retail banks and some building societies, which enables the customer to continue to use the account in the normal way even though its funds have been exhausted. The bank sets a limit to the amount by which the account can be overdrawn. An overdraft is a convenient form of short-term temporary borrowing, with interest calculated on a daily basis, and its purpose is to assist the customer over a period in which expenditure exceeds income - for instance, to pay for a holiday or to fund the purchase of christmas gifts.
Because it is essentially a short-term facility, the agreement is usually a fixed period, after which it must be renegotiated or the funds repaid. Overdrafts that have been agreed in advanced with the institution are normally an inexpensive for of borrowing, although there may be an arrangement fee. Unauthorised overdrafts, on the other hand, attract a much higher rate of interest.
Revolving Credit
This refers to arrangements where the customer can continue to borrow further amounts while still repaying existing debt. There is usually a maximum limit on the amount that can be outstanding, and also a minimum amount to be repaid on a regular basis.
The most common way of providing revolving credit is through credit cards, although some institutions do provide revolving personal loans that allow the borrower to draw down funds as the origional debt is repaid.
It is hard to believe that plastic cards, now an integral part of most people's financial affairs, have been around for the last 30 years. Their development and their impact have gone hand-in-hand with the rapid advance of the electronic processing technologies on which their systems now largely depend. Many cards can now hold a wealth of information about cardholders and their accounts, and can therefore interact directly with retailers and banks electronic equipment, these cards are often referred to as smart cards.
Credit Cards
Credit cards enable customers to shop without cash or cheques in any establishment that is a member of the credit card companies scheme.
Originally all credit card transactions were dealt with manually at the point of sale, but most retailers now have terminals linked directly to the credit card companies computers, enabling on-line credit limit checking and authorisation of transactions.
As well as providing cash-free purchasing convenience, credit cards are a source of revolving credit. The customer has a credit limit and can use the car for purchases or other transactions up to that amount, provided that at least a specified minimum amount (usually 3% of the outstanding balance) is repaid each month. The customer receives a monthly statement, detailing recent transactions and showing the outstanding balance. If the balance is repaid in full within a certain period (usually 25 days or so), no interest is charges, if a smaller amount is paid, the remainder is carried forward and interest charges at the companies current rate.
Credit cards are an expensive way to borrow, with rates of interest considerably higher than most other lending products. There is also normally a charge if the card is used to obtain cash either over the counter or from an automated teller machine (ATM), or if the card is used overseas.
Credit card companies charge a fee to the retailers for their service. This is usually as a percentage (typically around 3%) of the value of transactions when the credit card company makes a settlement to the retailer. There are, however, a number of advantages to retailers, in addition to the fact that more customers may be attracted if payment by credit card is available. For instance, payment is guaranteed if the card has been accepted in accordance with the credit card companies rules. Furthermore, the retailer can reduce his or her own bank charges because the credit card vouchers paid into the bank account are treated as cash.
Two other types of cards are mentioned below for completeness, although they do not offer credit facilities (except in a very limited sense in the case of charge cards).
Charge Cards
Although used by the customer in the same way as a credit card to make purchases, the outstanding balance on a charge card must be paid in full each month. The best known examples are american express and diners club.
Debit Cards
An innovation introduced in the late 1980's, debit cards enable cardholders to make payments for goods by presenting the card and signing a voucher, in just the same way as with credit cards or charge cards. In the case of debit cards, however, the effect of the transaction is that funds equal to the amount spent are transferred electronically from the cardholder's current account to the account of the retailer. Debit cards can also be used to withdraw money from ATM's, and many debit cards now also act as a cheque guarantee card.
The loan can be used for any purpose y the customer, typically they are used to purchase cars, fund holidays, or consolidate existing higher cost borrowings such as credit card balances.
The purpose of the loan determines whether it is regulated under the terms of the consumer credit act 1974. Most such loans of £25,000 or less are regulated by the act unless they are for house purchase or home improvement.
Overdrafts
An overdraft is a current account facility, offered by all retail banks and some building societies, which enables the customer to continue to use the account in the normal way even though its funds have been exhausted. The bank sets a limit to the amount by which the account can be overdrawn. An overdraft is a convenient form of short-term temporary borrowing, with interest calculated on a daily basis, and its purpose is to assist the customer over a period in which expenditure exceeds income - for instance, to pay for a holiday or to fund the purchase of christmas gifts.
Because it is essentially a short-term facility, the agreement is usually a fixed period, after which it must be renegotiated or the funds repaid. Overdrafts that have been agreed in advanced with the institution are normally an inexpensive for of borrowing, although there may be an arrangement fee. Unauthorised overdrafts, on the other hand, attract a much higher rate of interest.
Revolving Credit
This refers to arrangements where the customer can continue to borrow further amounts while still repaying existing debt. There is usually a maximum limit on the amount that can be outstanding, and also a minimum amount to be repaid on a regular basis.
The most common way of providing revolving credit is through credit cards, although some institutions do provide revolving personal loans that allow the borrower to draw down funds as the origional debt is repaid.
It is hard to believe that plastic cards, now an integral part of most people's financial affairs, have been around for the last 30 years. Their development and their impact have gone hand-in-hand with the rapid advance of the electronic processing technologies on which their systems now largely depend. Many cards can now hold a wealth of information about cardholders and their accounts, and can therefore interact directly with retailers and banks electronic equipment, these cards are often referred to as smart cards.
Credit Cards
Credit cards enable customers to shop without cash or cheques in any establishment that is a member of the credit card companies scheme.
Originally all credit card transactions were dealt with manually at the point of sale, but most retailers now have terminals linked directly to the credit card companies computers, enabling on-line credit limit checking and authorisation of transactions.
As well as providing cash-free purchasing convenience, credit cards are a source of revolving credit. The customer has a credit limit and can use the car for purchases or other transactions up to that amount, provided that at least a specified minimum amount (usually 3% of the outstanding balance) is repaid each month. The customer receives a monthly statement, detailing recent transactions and showing the outstanding balance. If the balance is repaid in full within a certain period (usually 25 days or so), no interest is charges, if a smaller amount is paid, the remainder is carried forward and interest charges at the companies current rate.
Credit cards are an expensive way to borrow, with rates of interest considerably higher than most other lending products. There is also normally a charge if the card is used to obtain cash either over the counter or from an automated teller machine (ATM), or if the card is used overseas.
Credit card companies charge a fee to the retailers for their service. This is usually as a percentage (typically around 3%) of the value of transactions when the credit card company makes a settlement to the retailer. There are, however, a number of advantages to retailers, in addition to the fact that more customers may be attracted if payment by credit card is available. For instance, payment is guaranteed if the card has been accepted in accordance with the credit card companies rules. Furthermore, the retailer can reduce his or her own bank charges because the credit card vouchers paid into the bank account are treated as cash.
Two other types of cards are mentioned below for completeness, although they do not offer credit facilities (except in a very limited sense in the case of charge cards).
Charge Cards
Although used by the customer in the same way as a credit card to make purchases, the outstanding balance on a charge card must be paid in full each month. The best known examples are american express and diners club.
Debit Cards
An innovation introduced in the late 1980's, debit cards enable cardholders to make payments for goods by presenting the card and signing a voucher, in just the same way as with credit cards or charge cards. In the case of debit cards, however, the effect of the transaction is that funds equal to the amount spent are transferred electronically from the cardholder's current account to the account of the retailer. Debit cards can also be used to withdraw money from ATM's, and many debit cards now also act as a cheque guarantee card.
Offshore Tax
'Moving offshore' is a common tax planning strategy that you've probably seen mentioned in thrillers or seen in Hollywood films – but how applicable is it the average man in the street?
Well you'll be pleased to know that the UK offers some of the best offshore tax rules in Europe and is much more attractive than the United States. Under the UK rules once you establish yourself as 'non UK resident' for tax purposes your tax ties to the UK are pretty much severed. Of course there are still occasions when the UK taxman will look for his share of the 'tax take' but as a general rule these are pretty few and far between.
One of the best aspects of the UK tax system, unlike the many European countries (eg Spain and France) is that you can leave the UK and sell UK assets totally free of UK capital gains tax ('CGT'). This means that anyone owning property, investments or even a company can leave the UK and sell up without paying any UK tax. This is unusual as many countries take the view that as the gain has effectively arose over the period you've lived in the UK they want to retain taxing right. Not the UK though.
Of course if you were planning to do this there are a number of conditions you'd need to satisfy but if the tax at stake is significant they're usually not too onerous. The other issue of course with any form of offshore tax planning is finding out what the offshore tax position is overseas. The last thing you want is to 'jump put of the frying pan and into the fire'. This is a big risk for company owners who would usually be entitled to significant tax reliefs in the UK which could reduce their effective tax rate to just 10%. If they go overseas and don't look into it carefully they could end up paying more tax!
There are though a number of 'tax free' havens as well as 'low tax' havens that aren't even too far from the UK.
Countries such as Monaco and Andorra are effectively tax free for many UK expats.
In terms of low tax havens – take your pick as there are plenty! Examples include:
Malta
Isle of Man
Channel Islands
Cyprus
GibraltarIf you weren't bothered about going further afield you could also consider countries such as Dubai, Hong Kong, Singapore, Bahamas, Bermuda, Cayman Islands and the British Virgin Islands which can all eliminate or significantly reduce your taxes.
So what's involved in actually 'going offshore'?
Well, at it's simplest you could just sell up and live overseas…end of story! If you wanted to make a clean break with the UK this is basically what you'd do. Of course there are a few forms to fill in and you'd need to be careful as to when you sold assets but in tax terms it's actually very straightforward.
If like many expats you want to keep a 'foot in the door' in the UK, and still have UK links (such as a UK property, investments, close family etc) it's not quite as straightforward. There are time limits published by the Revenue that you'll need to observe for periods spent in the UK (generally less than 90 days on average over four years and not more than 183 days in any one tax year) but you'll also need to show that you've established a new home overseas and that there are few 'ongoing connections' with the UK. This isn't too difficult but will involve a bit more consideration of your position and UK assets/involvements.
Well you'll be pleased to know that the UK offers some of the best offshore tax rules in Europe and is much more attractive than the United States. Under the UK rules once you establish yourself as 'non UK resident' for tax purposes your tax ties to the UK are pretty much severed. Of course there are still occasions when the UK taxman will look for his share of the 'tax take' but as a general rule these are pretty few and far between.
One of the best aspects of the UK tax system, unlike the many European countries (eg Spain and France) is that you can leave the UK and sell UK assets totally free of UK capital gains tax ('CGT'). This means that anyone owning property, investments or even a company can leave the UK and sell up without paying any UK tax. This is unusual as many countries take the view that as the gain has effectively arose over the period you've lived in the UK they want to retain taxing right. Not the UK though.
Of course if you were planning to do this there are a number of conditions you'd need to satisfy but if the tax at stake is significant they're usually not too onerous. The other issue of course with any form of offshore tax planning is finding out what the offshore tax position is overseas. The last thing you want is to 'jump put of the frying pan and into the fire'. This is a big risk for company owners who would usually be entitled to significant tax reliefs in the UK which could reduce their effective tax rate to just 10%. If they go overseas and don't look into it carefully they could end up paying more tax!
There are though a number of 'tax free' havens as well as 'low tax' havens that aren't even too far from the UK.
Countries such as Monaco and Andorra are effectively tax free for many UK expats.
In terms of low tax havens – take your pick as there are plenty! Examples include:
Malta
Isle of Man
Channel Islands
Cyprus
GibraltarIf you weren't bothered about going further afield you could also consider countries such as Dubai, Hong Kong, Singapore, Bahamas, Bermuda, Cayman Islands and the British Virgin Islands which can all eliminate or significantly reduce your taxes.
So what's involved in actually 'going offshore'?
Well, at it's simplest you could just sell up and live overseas…end of story! If you wanted to make a clean break with the UK this is basically what you'd do. Of course there are a few forms to fill in and you'd need to be careful as to when you sold assets but in tax terms it's actually very straightforward.
If like many expats you want to keep a 'foot in the door' in the UK, and still have UK links (such as a UK property, investments, close family etc) it's not quite as straightforward. There are time limits published by the Revenue that you'll need to observe for periods spent in the UK (generally less than 90 days on average over four years and not more than 183 days in any one tax year) but you'll also need to show that you've established a new home overseas and that there are few 'ongoing connections' with the UK. This isn't too difficult but will involve a bit more consideration of your position and UK assets/involvements.
Cheap Personal Loans Uk – Easy Way To Get Low Rate Finance
Personal loans must come at cheap rate and the overall cost of loan availing should also be cheap so that the borrower never feels the loan repaying burden and avoids debt. The UK people can take cheap personal loans easily these days as there are number of such lenders competing for the costumers. So you can have cheap personal loans for any personal purpose like renovating home, purchasing a brand new car, clearing your self of debts, going to enjoyable long holiday tour or paying for wedding expenses and so on.
The UK people can have access to cheap persona loans in secured or unsecured options. Usually secured personal loans are source of cheap interest rate as lenders takes the borrower’s home or any valuable property as security. Greater loan amount, depending on value of the property and larger repaying duration of 5 to 30 years are added advantages of secured cheap personal loans for the UK residents. However even unsecured personal loans can be availed at cheap rate though not at the same rate as on the secured option. Here cheap rate means comparatively lower interest rate. if your credit history is good and have good repaying capacity, cheap rate is ensured on unsecured cheap personal loans in the UK. In case you have bad credit, pay off some debts first so that credit score improves and then you may be approved the loan at comparatively lower rate.
As far as the sourcing is concerned, there are number of lenders who are providing cheap personal loans for the UK residents. You can locate them on internet. Make sure to compare them for finding a lower interest rate loan. Online lenders do not take any fee on processing the loan application and so this way also you ensure low cost of the loan, making it cheap personal loan. for avoiding debts, clear the loan installments regularly on time.
The UK people can have access to cheap persona loans in secured or unsecured options. Usually secured personal loans are source of cheap interest rate as lenders takes the borrower’s home or any valuable property as security. Greater loan amount, depending on value of the property and larger repaying duration of 5 to 30 years are added advantages of secured cheap personal loans for the UK residents. However even unsecured personal loans can be availed at cheap rate though not at the same rate as on the secured option. Here cheap rate means comparatively lower interest rate. if your credit history is good and have good repaying capacity, cheap rate is ensured on unsecured cheap personal loans in the UK. In case you have bad credit, pay off some debts first so that credit score improves and then you may be approved the loan at comparatively lower rate.
As far as the sourcing is concerned, there are number of lenders who are providing cheap personal loans for the UK residents. You can locate them on internet. Make sure to compare them for finding a lower interest rate loan. Online lenders do not take any fee on processing the loan application and so this way also you ensure low cost of the loan, making it cheap personal loan. for avoiding debts, clear the loan installments regularly on time.
Credit Card Fees You Need To Know About
You may not be aware of it, but many major credit card issuers have a hidden clause in your terms of agreement, known as the Universal Default Clause.
The Universal Default Clause Fiasco is a standard mechanism used by credit agencies to assess your overall credit worthiness and adjust your interest charges and fees accordingly.
The Universal Default Clause is a clever way credit card issuers justify increasing your interest rate, at a moments notice, and with virtually no recourse fo ryou. How does it work? Credit card issuers maintain a constant vigil of your credit report. The moment they notice you have made a late payment on any loan, the default clause kicks into effect and allows them to significantly increase your interest rate. The most common factors that have been known to trigger the clause include a reduction in your credit score, and late car or mortgage payments.
The Institute of Consumer Financial Education estimates up to 40% of credit card issuers have the Universal Default Clause in effect, and its impact can represent a doubling, or more, of your current interest rate. High interest rates can devastate your cash flow and increase the pressures to meet monthly maintenance fees. Watch out for this clause and do your best to make all your loan payments on time.
Bottom line: Look for the Universal Default Clause in your credit card agreement. Transfer funds to a card that does not use this clause, and in the future, avoid signing up with credit cards that use the Universal Default Clause.
The Universal Default Clause Fiasco is a standard mechanism used by credit agencies to assess your overall credit worthiness and adjust your interest charges and fees accordingly.
The Universal Default Clause is a clever way credit card issuers justify increasing your interest rate, at a moments notice, and with virtually no recourse fo ryou. How does it work? Credit card issuers maintain a constant vigil of your credit report. The moment they notice you have made a late payment on any loan, the default clause kicks into effect and allows them to significantly increase your interest rate. The most common factors that have been known to trigger the clause include a reduction in your credit score, and late car or mortgage payments.
The Institute of Consumer Financial Education estimates up to 40% of credit card issuers have the Universal Default Clause in effect, and its impact can represent a doubling, or more, of your current interest rate. High interest rates can devastate your cash flow and increase the pressures to meet monthly maintenance fees. Watch out for this clause and do your best to make all your loan payments on time.
Bottom line: Look for the Universal Default Clause in your credit card agreement. Transfer funds to a card that does not use this clause, and in the future, avoid signing up with credit cards that use the Universal Default Clause.
Unit Budgeting - A New Way To Save Money
The data that is available from the Federal Reserve Board is staggering. In 1989, credit card debt in America had reached $238 billion. By 2005, this number had almost tripled topping out at around $800 billion. The average Middle Class American family owes approximately $9,000 in credit card debt. When interest rates fell to “all time lows” and homeowners rushed to the banks to cash out all of their available equity on interest-only adjustable rate mortgages, they learned a harsh lesson when interest rates began to rise.
With the end of their interest only payment options coming due, we are seeing the results of the lack of a good budgeting system. The practice of excessively living beyond our means by treating credit as a source of wealth and not looking to the future is at last being exposed for what it really is: a harsh road to foreclosure and bankruptcy.
What about the folks who are not $9,000 or even $1,000 in debt, and yet never seem to have much money, and even if or when they do, they never seem to be able to make it last or put it to it’s best use? What the about those who do have a lot of extra money? What about those who make several thousand dollars more per month than what their bills amount to? Are they in serious trouble as well? Sadly, I’m afraid so. What is amazing is that the cause is the same for the well off as it is for the poor: the lack of a good budgeting system.
The Traditional Approach
There are numerous “traditional” methods of budgeting, which include simply balancing your checkbook and making sure you keep track of all of the checks you write. There are software programs like MS Money and Quicken that allow you to see where your money is being spent. There are a few pencil and paper methods where you are told to write down everything you spend your money on and make sure that that never exceeds your monthly income.
The common trait among all of these methods; however, is that they take a pragmatic approach to budgeting. Rather than relying on principle, they treat each expense or “budget problem” as unique. As such, there can be many different methods to budget your money, and the success or failure of a particular system depends on whether “it works” (at least in the short-term) regardless of the long-term consequences of the method. It is not surprising, then, that we see several different popular methods all claiming to be “the right one” or “the best”.
These methods are also 100% reactionary. Which means you are passively reacting to your money, your bills, and your financial life in general. The system depends on you reconciling your checkbook, or your spreadsheet, or whatever you’re using after you’ve already made purchases. These methods can only record and track your spending history, not help you control your current and future financial situation. The result is a static report of your past.
If you find yourself in a position where you never seem to have any money or enough money at the end of the month, this is the reason why. You cannot simply react to the world around you and try to control it at the same time. This passive, reactionary approach to budgeting often leaves an individual wondering “what am I doing wrong? I know what my expenses are, I know how much money I make every week/month, why can’t I seem to get ahead?”
If you find yourself with a lot of “extra” money, it is entirely possible, and in fact probable that you are losing money in the form of opportunity cost. Often times, those who are well off don’t see the need for a budget. They perceive it as something only the poor or the less well off folks need. However, budgeting in principle is good, therefore it is good no matter who you are - rich, middle class, or poor. To illustrate this point consider the situation of the famous pop singer Elton John who, earning $25 million a year, was spending so much money that he had to take out a $40 million loan just to pay off his debts. Even if you are thrifty, budgeting can be the difference between controlling where and what your savings is doing (in terms of return on investment) or simply passively reacting to it.
Then, there are what I call the "inspirational" methods. These are budgeting "tips" which set unrealistic expectations on you such as "just cut back on going out to the movies" or "always buy the generic brand" when grocery shopping. These methods attempt to control your lifestyle and dictate your wants and desires. It is no surprise that, usually, these systems fail for most people because they present you with a dichotomy (a split) between "needs" and "wants" that makes life generally unpleasant. I'm not saying that there aren't things that you should cut back on or that you don't need to change your lifestyle in order to become financially successful. But, whatever changes you make to your life should be your choice, not your advisor's.
The “Unit Method”
The Unit Method of budgeting takes a fundamentally different approach to managing your money. Instead of taking the pragmatic, reactionary approach, we are going to take a pro-active approach. Instead of simply reacting to each individual expense, we are going to plan for them and budget them before they ever happen. Instead of passively monitoring our savings, we are going to control it. Instead of telling you what to cut back on, to start buying the generic brands, or how you should live your life, we are going to let you make that choice.
To begin with, you need to gather together everything you spend your money on. It may be helpful to grab a cheap notebook and write down everything you spend your money on for an entire week, or an entire month, just to get an idea of where all of your money is going. Write down the specifics as well as how much money you spend on each item. Don’t forget the date that you made the purchase.
The next step is to collect all of your regular expenses. Total up everything that you spend your money on in a year (including when you spend it). You want to look ahead 12 months because you don’t want to forget expenses that may only come once or twice a year - like taxes, or car insurance, etc. Some examples of regular expenses (just to get you thinking) are:
Taxes (if using gross income or you are self employed)
Mortgage Payment
Second Mortgage payment
Household (yard)
Gas
Elect/Water/ Gar
Gas (for your automobile)
Auto Insurance
Maintenance (car maintenance like oil changes, tune ups, etc.)
Automobile Registration
TV
Life Insurance
Loans (car loans, personal loans, educational loans)
Credit Cards
Babysitting/Daycare
Clothing
Grocery
Eating Out
Nonfood grocery items (cleaning supplies, toilet paper, soap, laundry detergent, etc.)
Medical Bills
Hair cut/personal care items
Charitable Donations
Emergency Fund
College Fund
Dry Cleaning
Birthday gifts
Christmas gifts
Holidays and other gifts (i.e. Valentine’s Day)
Maintenance (home repairs, etc.)
Retirement Savings
Magazine Subscriptions
Membership dues (elks club, moose, club, or other social organization)
Dates (going out to “dinner and a movie” with your sweetheart)
Video rentals
Entertainment/”Play Money” (i.e. any hobbies)
After you’ve gathered all of your expenses together, it’s time to do some thinking. The method that we will be using to develop your “bulletproof” budget actually involves two processes: differentiation and integration. What you need to do is try to identify similarities among two or more concrete or specific expenditures and differentiate them from the rest of your expenditures. This should be done as simplistically as possible. Then, we need to integrate these similar expenditures while omitting their specifics and thus forming a new “unit”. This new “unit” becomes the basis for our budget and will allow you to easily track and control everything in your financial life.
The list I gave you above already accomplished part of the job for you. I merely asked you to do this process in reverse to come up with the concretes. For example, if you look at your expenditures and you find that you have a Discover card, 3 Chase cards, a Capital One card, and a Visa - we would group these together by their similarities, omit their specifics and form a new "unit" around them. From now on all credit cards can be filed under this “unit”.
But, what do we call this "unit"? Do we simply refer to the unit as "credit cards"? Is this the common denominator? Perhaps. We could group all credit cards together and form a unit called "Credit Cards". However, perhaps we could do better than that. What is a credit card? What is its essence? What is its purpose? What does it allow us to do? Aren't we borrowing money when we charge up a credit card? Isn't the major distinction between this expense and all of the other ones really the fact that these are all some type of loan? I think that this would be a more accurate association than just "credit cards". "Credit cards" denote what they are but not their purpose. Their purpose is to provide us with credit - with a loan, and unsecured loan, but a loan just the same. This is the key to making the "Unit Method" really work for you. You must find the most accurate associations between your expenses.
With the end of their interest only payment options coming due, we are seeing the results of the lack of a good budgeting system. The practice of excessively living beyond our means by treating credit as a source of wealth and not looking to the future is at last being exposed for what it really is: a harsh road to foreclosure and bankruptcy.
What about the folks who are not $9,000 or even $1,000 in debt, and yet never seem to have much money, and even if or when they do, they never seem to be able to make it last or put it to it’s best use? What the about those who do have a lot of extra money? What about those who make several thousand dollars more per month than what their bills amount to? Are they in serious trouble as well? Sadly, I’m afraid so. What is amazing is that the cause is the same for the well off as it is for the poor: the lack of a good budgeting system.
The Traditional Approach
There are numerous “traditional” methods of budgeting, which include simply balancing your checkbook and making sure you keep track of all of the checks you write. There are software programs like MS Money and Quicken that allow you to see where your money is being spent. There are a few pencil and paper methods where you are told to write down everything you spend your money on and make sure that that never exceeds your monthly income.
The common trait among all of these methods; however, is that they take a pragmatic approach to budgeting. Rather than relying on principle, they treat each expense or “budget problem” as unique. As such, there can be many different methods to budget your money, and the success or failure of a particular system depends on whether “it works” (at least in the short-term) regardless of the long-term consequences of the method. It is not surprising, then, that we see several different popular methods all claiming to be “the right one” or “the best”.
These methods are also 100% reactionary. Which means you are passively reacting to your money, your bills, and your financial life in general. The system depends on you reconciling your checkbook, or your spreadsheet, or whatever you’re using after you’ve already made purchases. These methods can only record and track your spending history, not help you control your current and future financial situation. The result is a static report of your past.
If you find yourself in a position where you never seem to have any money or enough money at the end of the month, this is the reason why. You cannot simply react to the world around you and try to control it at the same time. This passive, reactionary approach to budgeting often leaves an individual wondering “what am I doing wrong? I know what my expenses are, I know how much money I make every week/month, why can’t I seem to get ahead?”
If you find yourself with a lot of “extra” money, it is entirely possible, and in fact probable that you are losing money in the form of opportunity cost. Often times, those who are well off don’t see the need for a budget. They perceive it as something only the poor or the less well off folks need. However, budgeting in principle is good, therefore it is good no matter who you are - rich, middle class, or poor. To illustrate this point consider the situation of the famous pop singer Elton John who, earning $25 million a year, was spending so much money that he had to take out a $40 million loan just to pay off his debts. Even if you are thrifty, budgeting can be the difference between controlling where and what your savings is doing (in terms of return on investment) or simply passively reacting to it.
Then, there are what I call the "inspirational" methods. These are budgeting "tips" which set unrealistic expectations on you such as "just cut back on going out to the movies" or "always buy the generic brand" when grocery shopping. These methods attempt to control your lifestyle and dictate your wants and desires. It is no surprise that, usually, these systems fail for most people because they present you with a dichotomy (a split) between "needs" and "wants" that makes life generally unpleasant. I'm not saying that there aren't things that you should cut back on or that you don't need to change your lifestyle in order to become financially successful. But, whatever changes you make to your life should be your choice, not your advisor's.
The “Unit Method”
The Unit Method of budgeting takes a fundamentally different approach to managing your money. Instead of taking the pragmatic, reactionary approach, we are going to take a pro-active approach. Instead of simply reacting to each individual expense, we are going to plan for them and budget them before they ever happen. Instead of passively monitoring our savings, we are going to control it. Instead of telling you what to cut back on, to start buying the generic brands, or how you should live your life, we are going to let you make that choice.
To begin with, you need to gather together everything you spend your money on. It may be helpful to grab a cheap notebook and write down everything you spend your money on for an entire week, or an entire month, just to get an idea of where all of your money is going. Write down the specifics as well as how much money you spend on each item. Don’t forget the date that you made the purchase.
The next step is to collect all of your regular expenses. Total up everything that you spend your money on in a year (including when you spend it). You want to look ahead 12 months because you don’t want to forget expenses that may only come once or twice a year - like taxes, or car insurance, etc. Some examples of regular expenses (just to get you thinking) are:
Taxes (if using gross income or you are self employed)
Mortgage Payment
Second Mortgage payment
Household (yard)
Gas
Elect/Water/ Gar
Gas (for your automobile)
Auto Insurance
Maintenance (car maintenance like oil changes, tune ups, etc.)
Automobile Registration
TV
Life Insurance
Loans (car loans, personal loans, educational loans)
Credit Cards
Babysitting/Daycare
Clothing
Grocery
Eating Out
Nonfood grocery items (cleaning supplies, toilet paper, soap, laundry detergent, etc.)
Medical Bills
Hair cut/personal care items
Charitable Donations
Emergency Fund
College Fund
Dry Cleaning
Birthday gifts
Christmas gifts
Holidays and other gifts (i.e. Valentine’s Day)
Maintenance (home repairs, etc.)
Retirement Savings
Magazine Subscriptions
Membership dues (elks club, moose, club, or other social organization)
Dates (going out to “dinner and a movie” with your sweetheart)
Video rentals
Entertainment/”Play Money” (i.e. any hobbies)
After you’ve gathered all of your expenses together, it’s time to do some thinking. The method that we will be using to develop your “bulletproof” budget actually involves two processes: differentiation and integration. What you need to do is try to identify similarities among two or more concrete or specific expenditures and differentiate them from the rest of your expenditures. This should be done as simplistically as possible. Then, we need to integrate these similar expenditures while omitting their specifics and thus forming a new “unit”. This new “unit” becomes the basis for our budget and will allow you to easily track and control everything in your financial life.
The list I gave you above already accomplished part of the job for you. I merely asked you to do this process in reverse to come up with the concretes. For example, if you look at your expenditures and you find that you have a Discover card, 3 Chase cards, a Capital One card, and a Visa - we would group these together by their similarities, omit their specifics and form a new "unit" around them. From now on all credit cards can be filed under this “unit”.
But, what do we call this "unit"? Do we simply refer to the unit as "credit cards"? Is this the common denominator? Perhaps. We could group all credit cards together and form a unit called "Credit Cards". However, perhaps we could do better than that. What is a credit card? What is its essence? What is its purpose? What does it allow us to do? Aren't we borrowing money when we charge up a credit card? Isn't the major distinction between this expense and all of the other ones really the fact that these are all some type of loan? I think that this would be a more accurate association than just "credit cards". "Credit cards" denote what they are but not their purpose. Their purpose is to provide us with credit - with a loan, and unsecured loan, but a loan just the same. This is the key to making the "Unit Method" really work for you. You must find the most accurate associations between your expenses.
Tuesday, May 22, 2007
The Beauty Of Online Stock Trading
Online stock trading differs from the term "online trading" in that online stock trading refers to the online trading of only stocks and stock options. Online trading in general can refer to online trading of stocks, stock options, futures, futures options, etc.
Today's best online stock trading platforms give traders "information at their fingertips". Many will include quotes, charting, and even portfolio management. Useful stats include, portfolio by sector, portfolio by position, value by sector, value by position, and more.
When I first started online stock trading on of my favorite features was being able to see my account equity in real-time. Knowing exactly how much was in my account at any minute gave me a feeling of more control. Some of the account statistics available to you include net worth breakdown, profit & loss summary, commission and fee summary, profit/commissions ratio, etc.
Another great online stock trading feature is the ability to "park" orders. This is also one of my personal favorites. Parking and order simply means that you enter the order and save the order for later use. This is helpful because you can plan ahead and you don't have to enter and execute your orders at the same time or at the last minute. You will find the ability to prepare for your trading day both useful and empowering. This fits in nicely with those who trade according to the "Plan your trade and trade your plan philosophy"
Online stock trading gives you a great deal of control by having all your trading information integrated into on nice, neat package. Many platforms give you so many useful bells and whistles that you may not know where to start. Make sure that your online trading platform works for you and not the other way around.
Today's best online stock trading platforms give traders "information at their fingertips". Many will include quotes, charting, and even portfolio management. Useful stats include, portfolio by sector, portfolio by position, value by sector, value by position, and more.
When I first started online stock trading on of my favorite features was being able to see my account equity in real-time. Knowing exactly how much was in my account at any minute gave me a feeling of more control. Some of the account statistics available to you include net worth breakdown, profit & loss summary, commission and fee summary, profit/commissions ratio, etc.
Another great online stock trading feature is the ability to "park" orders. This is also one of my personal favorites. Parking and order simply means that you enter the order and save the order for later use. This is helpful because you can plan ahead and you don't have to enter and execute your orders at the same time or at the last minute. You will find the ability to prepare for your trading day both useful and empowering. This fits in nicely with those who trade according to the "Plan your trade and trade your plan philosophy"
Online stock trading gives you a great deal of control by having all your trading information integrated into on nice, neat package. Many platforms give you so many useful bells and whistles that you may not know where to start. Make sure that your online trading platform works for you and not the other way around.
Understanding Yourself When Trading Forex
Each person has certain personality traits that make us unique. These traits help, or limit, our progress in life, and especially when aiming for Successful Forex Trading. To live a happy and fulfilled life is easier when you know your own personality traits. Trying to understand what makes you tick can be of great help when you know how you will probably react in certain situations and why. Successful Forex Trading is one area where knowledge of your different traits can be advantageous. Money makes most people emotional at some stages and knowing beforehand how you probably would react to suddenly losing, or making, a lot of money would help you stay afloat. Money has tremendous influence in the lives of people and the lack of money, or the possibility of increasing your money pushes the buttons of your emotions.
That is why being too emotionally involved is so dangerous when investing. Emotions are what make us human. Emotions help, or limit, our progress through life, but it can be detrimental to your investing success. There are probably many emotions an investor can experience, but the two most common are fear and greed. Fear can make you so cautious that you miss a lot of good investment opportunities, or let you get out of a trade too soon, missing the bigger and more profitable move. Being unsure whether the market will react in the way you hope after interpreting the charts can also make you afraid, because what if the market moves the other way? The flip side of fear is greed. And in my mind it is more dangerous than fear. Fear sometimes keeps you out of the market, but greed pushes you into the market as much as possible. Greed affects most people and lets you ignore the warnings. Greed can make you over-optimistic. Believing that the next move will make you rich, increasing the amount of money invested. Greed let you live in a dream world that could make you impatient when profits do not come quickly enough, and this could quickly turn into a nightmare.
Personality traits differ from person to person and for this reason each investor must learn to understand him self or her self. Some people struggling more with making final decisions than others. Struggling with making a decision can cause you to lose a lot of money. The market is always dynamic, always moving, so while the investor is struggling with making decisions the market situation could have changed. The danger of this trait is that this is a way of life for people struggling with it. Struggling to make fast decision affects the whole life of this person. This makes it more difficult when investing since emotions and money are included in the equation. Wondering when to enter or exit the forex market can cause missing opportunities and these mistakes can intensify other emotions like fear or regret.
Some people or very conscientious are being defined as a person who is very meticulous and painstakingly accurate. These persons could be the opposite of the above. Being very sure of there decision since they research it so thoroughly. They would give extraordinary attention to certain details and sometimes checking and rechecking their findings just to make sure. In some areas of life this trait could be beneficial, but when investing it could hamper your success. By the time the investor has checked all his findings the forex market could have moved on, leaving him without the opportunity to enter, or exit the trade at a decent level. The forex market cannot be predicted. Technical and fundamental analysis could only give an indication of the possible direction the market could take in the near future, but there is no guarantee. Spending too much time on research trying to be “absolutely correct” could cause you to react far to late.
Some people are more Open than others. I like to define openness as being able to absorbed changing situations and make corrections in your reactions based on the new information. This could be one of the more positive traits for an investor to acquire. History does repeat itself, but not always in the same manner or under the same situations. Being able to change your outlook when situations change drastically could be advantageous to investing. This does not mean that you alter your investment strategy completely every few months. It rather means that you always make small adjustments when it becomes apparent that there could be some flaws in you investment strategy in regard to the current market situations. Some strategies work better in certain market situations than others. Being open could help you to notice this and make adjustments in time. Openness can also help you to absorb all the viewpoints regarding a share or its possible future and selecting the facts from the fiction, sometimes causing you to avoid a possible investment that appeared good after some warning regarding the company.
Self-discipline is also a trait that could be positive when investing on the market. Investing is something that could be learned, but like all learned behavior it takes time and practice to reach a level of success. Learning something new means getting to grips with failing. Most people do not have a natural tendency to mastering a new concept, like learning to invest on the stock market. It takes time and it means making mistakes. Self-discipline can help you to stick to learning when it appears as if it is not working. Also, discipline is extremely good at helping to curb the effect of emotions. Being disciplined helps you to avoid making irrational decision based on your current emotional state. Self-discipline also helps you to stay patient. I read somewhere that patient money makes money.
So, understanding yourself; knowing your strengths and weaknesses can help you when investing, but what can you do to limit the negatives of your weakness and enhancing the strengths? I believe by designing a good and robust system. If you are someone who is open and willing to integrate new ideas, then designing a robust system could be easier that someone being very set in his ways. A robust system is one that helps you to identify good entry and exit points, which is determined by a balanced blend of technical and fundamental analysis and combined with effective money management techniques.
Finding a good system that complements your personality and sticking to it can advance your success on the market. A good system you trust helps curb the effects of emotions and indecision. Following the system removes some uncertainty. Knowing that most systems are incorrect about 40%-60% of the time helps you to understand that losses are part of the game. Having self-discipline will help in following your system through these inevitable losses. Having good money management, reducing the amount of money to risk and using a good stop-loss system, could help you weather these losses while waiting for the bigger profits. Being disciplined helps to reduce the possibility of greed or fear causing you to be irrational. Knowing yourself, knowing your system and trusting in the positives of both could help you reaching your goal, and that surely is investing successfully in the forex market.
That is why being too emotionally involved is so dangerous when investing. Emotions are what make us human. Emotions help, or limit, our progress through life, but it can be detrimental to your investing success. There are probably many emotions an investor can experience, but the two most common are fear and greed. Fear can make you so cautious that you miss a lot of good investment opportunities, or let you get out of a trade too soon, missing the bigger and more profitable move. Being unsure whether the market will react in the way you hope after interpreting the charts can also make you afraid, because what if the market moves the other way? The flip side of fear is greed. And in my mind it is more dangerous than fear. Fear sometimes keeps you out of the market, but greed pushes you into the market as much as possible. Greed affects most people and lets you ignore the warnings. Greed can make you over-optimistic. Believing that the next move will make you rich, increasing the amount of money invested. Greed let you live in a dream world that could make you impatient when profits do not come quickly enough, and this could quickly turn into a nightmare.
Personality traits differ from person to person and for this reason each investor must learn to understand him self or her self. Some people struggling more with making final decisions than others. Struggling with making a decision can cause you to lose a lot of money. The market is always dynamic, always moving, so while the investor is struggling with making decisions the market situation could have changed. The danger of this trait is that this is a way of life for people struggling with it. Struggling to make fast decision affects the whole life of this person. This makes it more difficult when investing since emotions and money are included in the equation. Wondering when to enter or exit the forex market can cause missing opportunities and these mistakes can intensify other emotions like fear or regret.
Some people or very conscientious are being defined as a person who is very meticulous and painstakingly accurate. These persons could be the opposite of the above. Being very sure of there decision since they research it so thoroughly. They would give extraordinary attention to certain details and sometimes checking and rechecking their findings just to make sure. In some areas of life this trait could be beneficial, but when investing it could hamper your success. By the time the investor has checked all his findings the forex market could have moved on, leaving him without the opportunity to enter, or exit the trade at a decent level. The forex market cannot be predicted. Technical and fundamental analysis could only give an indication of the possible direction the market could take in the near future, but there is no guarantee. Spending too much time on research trying to be “absolutely correct” could cause you to react far to late.
Some people are more Open than others. I like to define openness as being able to absorbed changing situations and make corrections in your reactions based on the new information. This could be one of the more positive traits for an investor to acquire. History does repeat itself, but not always in the same manner or under the same situations. Being able to change your outlook when situations change drastically could be advantageous to investing. This does not mean that you alter your investment strategy completely every few months. It rather means that you always make small adjustments when it becomes apparent that there could be some flaws in you investment strategy in regard to the current market situations. Some strategies work better in certain market situations than others. Being open could help you to notice this and make adjustments in time. Openness can also help you to absorb all the viewpoints regarding a share or its possible future and selecting the facts from the fiction, sometimes causing you to avoid a possible investment that appeared good after some warning regarding the company.
Self-discipline is also a trait that could be positive when investing on the market. Investing is something that could be learned, but like all learned behavior it takes time and practice to reach a level of success. Learning something new means getting to grips with failing. Most people do not have a natural tendency to mastering a new concept, like learning to invest on the stock market. It takes time and it means making mistakes. Self-discipline can help you to stick to learning when it appears as if it is not working. Also, discipline is extremely good at helping to curb the effect of emotions. Being disciplined helps you to avoid making irrational decision based on your current emotional state. Self-discipline also helps you to stay patient. I read somewhere that patient money makes money.
So, understanding yourself; knowing your strengths and weaknesses can help you when investing, but what can you do to limit the negatives of your weakness and enhancing the strengths? I believe by designing a good and robust system. If you are someone who is open and willing to integrate new ideas, then designing a robust system could be easier that someone being very set in his ways. A robust system is one that helps you to identify good entry and exit points, which is determined by a balanced blend of technical and fundamental analysis and combined with effective money management techniques.
Finding a good system that complements your personality and sticking to it can advance your success on the market. A good system you trust helps curb the effects of emotions and indecision. Following the system removes some uncertainty. Knowing that most systems are incorrect about 40%-60% of the time helps you to understand that losses are part of the game. Having self-discipline will help in following your system through these inevitable losses. Having good money management, reducing the amount of money to risk and using a good stop-loss system, could help you weather these losses while waiting for the bigger profits. Being disciplined helps to reduce the possibility of greed or fear causing you to be irrational. Knowing yourself, knowing your system and trusting in the positives of both could help you reaching your goal, and that surely is investing successfully in the forex market.
Make Millions By Loaning Money That's Not Even Yours That You Don't Even Have-Its All Legal Too
Make Millions By Loaning Money That’s Not Even Yours That You Don’t Even Have—its all legal too
You may think this is how loaning money works: You have $10,000. You loan it at 15 % and at the end of the year you get $1,500 in interest and your $10,000 back. Not bad. If you had put that money is a money market account you would receive at most 6 % interest or $600.
But this is NOT the way the game works, not if you know how it is really played, not if you play by the rules that have already been established for others. Not if you become ONE OF THEM.
THIS IS HOW THE GAME IS REALLY PLAYED:
Let’s take that original $10,000. Let’s assume that it’s not even your money. Let’s assume it’s someone else’s $10,000. Of course, if it’s not yours, you’re going to have to pay something, say 6 %, $600, for the use of that money.
But, with that $10,000 using completely legal rules and existing laws you can now loan up to $300,000
Yes, you heard me. Under existing laws, if you have $10,000 (and the money doesn’t have to be yours), you can loan up to $300,000 as long as you keep the original $10,000 on hand. (3 % to 10 % of your outstanding loans must be kept)
WOW!
Now, the question you need to ask, the question you want to ask, the question you should be asking is:
HOW MUCH MONEY CAN I MAKE LOANING MONEY THAT I DON”T HAVE AND IS NOT EVEN MINE?
The answer: THE SKY’S THE LIMIT
Yes, you heard me correctly. THE SKY’S THE LIMIT.
Based on your original $10,000: If you loaned $300,000 at 20 %, you would receive $60,000 in interest (note: the average credit card rate in the US is 18.9%). Remember that money only cost you $600
YOUR NET PROFIT IS $60,000 - $ 600 = $59,400 a 10,000% increase on net invested capital using some else’s money. And please don’t feel sorry for that person. They’re actually happy to get 6 % for their money BECAUSE THE US GOVERNMENT WILL GUARANTEE THEIR $10,000. Yes, you heard me. You pay the US government 7¢ per $100 and the US government guarantees anyone up to $100,000 (this program is called the FDIC)
Let’s say instead you got $100,000. With $100,000, you could then loan $3,000,000 and receive $600,000 interest (at 20 %).
Expenses: $6,000.00 interest for other peoples’ money
$70.00 to FDIC to insure the $100,000 Total expenses : $6,070.00
Your net profit: $593,930.00 (using someone else’s $100,000)
AND THERE’S LOTS MORE because there’s NO LIMIT to the interest or the amount of fees you can charge.
WHY?
Because the US deregulated the loan (banking) industry and bankers can now charge as much as they want, as often as they want to anyone anywhere and ITS ALL LEGAL.
In 1978, the US Supreme Court deregulated interest rates on bank loans, i.e. no more usury laws, and allowed banks in states that allowed high interest rates (i.e. South Dakota) to issue cards at high rates in other states—even if other states outlawed higher rates.
There You Have It. Make Millions By Loaning Money That’s Not Even Yours That You Don’t Even HaveAll You Have To Do Is Be A BankBe A Banker Or A BankruptIt’s Your Choice
You may think this is how loaning money works: You have $10,000. You loan it at 15 % and at the end of the year you get $1,500 in interest and your $10,000 back. Not bad. If you had put that money is a money market account you would receive at most 6 % interest or $600.
But this is NOT the way the game works, not if you know how it is really played, not if you play by the rules that have already been established for others. Not if you become ONE OF THEM.
THIS IS HOW THE GAME IS REALLY PLAYED:
Let’s take that original $10,000. Let’s assume that it’s not even your money. Let’s assume it’s someone else’s $10,000. Of course, if it’s not yours, you’re going to have to pay something, say 6 %, $600, for the use of that money.
But, with that $10,000 using completely legal rules and existing laws you can now loan up to $300,000
Yes, you heard me. Under existing laws, if you have $10,000 (and the money doesn’t have to be yours), you can loan up to $300,000 as long as you keep the original $10,000 on hand. (3 % to 10 % of your outstanding loans must be kept)
WOW!
Now, the question you need to ask, the question you want to ask, the question you should be asking is:
HOW MUCH MONEY CAN I MAKE LOANING MONEY THAT I DON”T HAVE AND IS NOT EVEN MINE?
The answer: THE SKY’S THE LIMIT
Yes, you heard me correctly. THE SKY’S THE LIMIT.
Based on your original $10,000: If you loaned $300,000 at 20 %, you would receive $60,000 in interest (note: the average credit card rate in the US is 18.9%). Remember that money only cost you $600
YOUR NET PROFIT IS $60,000 - $ 600 = $59,400 a 10,000% increase on net invested capital using some else’s money. And please don’t feel sorry for that person. They’re actually happy to get 6 % for their money BECAUSE THE US GOVERNMENT WILL GUARANTEE THEIR $10,000. Yes, you heard me. You pay the US government 7¢ per $100 and the US government guarantees anyone up to $100,000 (this program is called the FDIC)
Let’s say instead you got $100,000. With $100,000, you could then loan $3,000,000 and receive $600,000 interest (at 20 %).
Expenses: $6,000.00 interest for other peoples’ money
$70.00 to FDIC to insure the $100,000 Total expenses : $6,070.00
Your net profit: $593,930.00 (using someone else’s $100,000)
AND THERE’S LOTS MORE because there’s NO LIMIT to the interest or the amount of fees you can charge.
WHY?
Because the US deregulated the loan (banking) industry and bankers can now charge as much as they want, as often as they want to anyone anywhere and ITS ALL LEGAL.
In 1978, the US Supreme Court deregulated interest rates on bank loans, i.e. no more usury laws, and allowed banks in states that allowed high interest rates (i.e. South Dakota) to issue cards at high rates in other states—even if other states outlawed higher rates.
There You Have It. Make Millions By Loaning Money That’s Not Even Yours That You Don’t Even HaveAll You Have To Do Is Be A BankBe A Banker Or A BankruptIt’s Your Choice
Take Your Money Off The Table NOW
Stocks are at all time highs. Remember, buy low sell high? Now is the time to take that advice.
The world is awash with bubbles. Last month legendary advisor and Dick Cheney’s banker Jeremy Grantham wrote: “Everything’s a bubble… from the junkiest bonds to mundane blue chips; it’s bubble time.
Because bubbles collapse, you must take your profits before they deflate. Bubbles produce feelings of false confidence, so most investors don’t. In April the Dow Industrials rose 19 out of 21 trading days. The last time that happened was in 1929.
When bubbles collapse, the drop is devastating. The 1929 bubble took nine years to reach a bottom. In 1938, the Dow finally landed 90% below its 1929 top. In 1953, the market was still down 75%. It is going to happen again and soon. The world is awash with credit and investments are leveraged as never before. The percentage of stocks bought on margin is now the same as it was in 1929.
Recently, Bloomberg News reported Blue Planet’s Worldwide Financials fund, the world’s best performing investment trust for the past three years, just sold most of its stocks predicting a 20% (or greater) decline in global stock markets.
Last year an investment advisory service cautioned “While there’s still money to be made, be sure to dance close to the door.” Sage advice, good times don’t last forever. It’s time to take your money off the table now. The good times are about to end.
The world is awash with bubbles. Last month legendary advisor and Dick Cheney’s banker Jeremy Grantham wrote: “Everything’s a bubble… from the junkiest bonds to mundane blue chips; it’s bubble time.
Because bubbles collapse, you must take your profits before they deflate. Bubbles produce feelings of false confidence, so most investors don’t. In April the Dow Industrials rose 19 out of 21 trading days. The last time that happened was in 1929.
When bubbles collapse, the drop is devastating. The 1929 bubble took nine years to reach a bottom. In 1938, the Dow finally landed 90% below its 1929 top. In 1953, the market was still down 75%. It is going to happen again and soon. The world is awash with credit and investments are leveraged as never before. The percentage of stocks bought on margin is now the same as it was in 1929.
Recently, Bloomberg News reported Blue Planet’s Worldwide Financials fund, the world’s best performing investment trust for the past three years, just sold most of its stocks predicting a 20% (or greater) decline in global stock markets.
Last year an investment advisory service cautioned “While there’s still money to be made, be sure to dance close to the door.” Sage advice, good times don’t last forever. It’s time to take your money off the table now. The good times are about to end.
Why You May Need a Secured Credit Card
Think a secured credit card is the scarlet letter of the credit world? You might want to think twice. Secured credit cards aren't reserved for those with irresponsible spending habits. In fact, there are a few different reasons why someone may need a secured credit card, and none of them have to do with irresponsible financial habits.
1. A Ghost
I remember when I applied for my first car loan (I was 18) and I was told I was a "ghost". I had no idea what in the world they were talking about. It turns out, the word "ghost" meant that I had no credit -- none whatsoever. No bad credit, no good credit, not a single unpaid bill (or paid bill for that matter). Nothing, nada, zip.
Oftentimes no credit can be worse than bad credit. At least with bad credit someone is willing to give you a second chance. With no credit, it seems they just run in the other direction. That's where a secured credit card can help.
If you have no credit at all, a secured card can be the tool you need to establish a positive credit history. Instead of nothing showing up on your credit report, your secured card account and payment history will show up and your credit history will begin to develop.
2. A Fledgling Business
If you start a business and want to establish a line of credit, a secured card might be needed. A fledgling business is considered risky by most creditors (especially since many businesses go belly up their first year). Because of this, an unsecured card might not be an option. A secured credit card, however, can help your new business develop the credit history it needs.
3. When Bad Things Happen to Good People
Even if your credit has some bruises, it doesn't mean you're financially irresponsible. I once knew a person who had horrible credit and didn't do a thing to deserve it. Her husband had gotten seriously ill and while their insurance did cover some of the expenses, she found herself claiming bankruptcy because of the tens of thousands of dollars that weren't covered.
This person was not financially irresponsible. In fact, she had never had an unpaid bill and had never made a late payment. Yet, she found herself filling for bankruptcy. A few months after the bankruptcy, she found herself applying for a secured credit card to help re-establish her creditworthiness.
As you can see, a secured credit card isn't a reflection on the card holder's financial common sense. There are a number of reasons why a person might not be able to qualify for an unsecured credit card and oftentimes a secured credit card can be the very thing needed to hold you over until lenders see you as the financially-responsible individual you are.
1. A Ghost
I remember when I applied for my first car loan (I was 18) and I was told I was a "ghost". I had no idea what in the world they were talking about. It turns out, the word "ghost" meant that I had no credit -- none whatsoever. No bad credit, no good credit, not a single unpaid bill (or paid bill for that matter). Nothing, nada, zip.
Oftentimes no credit can be worse than bad credit. At least with bad credit someone is willing to give you a second chance. With no credit, it seems they just run in the other direction. That's where a secured credit card can help.
If you have no credit at all, a secured card can be the tool you need to establish a positive credit history. Instead of nothing showing up on your credit report, your secured card account and payment history will show up and your credit history will begin to develop.
2. A Fledgling Business
If you start a business and want to establish a line of credit, a secured card might be needed. A fledgling business is considered risky by most creditors (especially since many businesses go belly up their first year). Because of this, an unsecured card might not be an option. A secured credit card, however, can help your new business develop the credit history it needs.
3. When Bad Things Happen to Good People
Even if your credit has some bruises, it doesn't mean you're financially irresponsible. I once knew a person who had horrible credit and didn't do a thing to deserve it. Her husband had gotten seriously ill and while their insurance did cover some of the expenses, she found herself claiming bankruptcy because of the tens of thousands of dollars that weren't covered.
This person was not financially irresponsible. In fact, she had never had an unpaid bill and had never made a late payment. Yet, she found herself filling for bankruptcy. A few months after the bankruptcy, she found herself applying for a secured credit card to help re-establish her creditworthiness.
As you can see, a secured credit card isn't a reflection on the card holder's financial common sense. There are a number of reasons why a person might not be able to qualify for an unsecured credit card and oftentimes a secured credit card can be the very thing needed to hold you over until lenders see you as the financially-responsible individual you are.
Vanishing Low Interest Rates and Sioux Falls, South Dakota
Many often wonder why their credit card bill comes to you from the likes of Sioux Falls in South Dakota. This is because the state of South Dakota is the home of many large credit card issuers who naturally take advantage of the state's lack of concern in credit card consumer protection laws. Also this may be due in part to a lack of a state corporate income taxes. Still, the state of South Dakota benefits greatly from the jobs and revenues generated by these businesses. There are many financial service companies located in South Dakota including Great Western Bank, Total Card Inc., BankFirst, Capital Card Services, HSBC, PREMIER Bankcard, and Wells Fargo.
Credit card fees over the years recently have skyrocketed from $2.6 billion in 1980 to over $22.5 billion in 2006. The kicker that has most ticked off consumer advocates is a practice called "universal default". In this sytem when you find yourself late paying the bill, the card company might raise your interest rate to something that is well over 20 percent. There have been many criticisms of this structure including the concept of one lender charging a higher price when their customer defaults with another lender has been compared to having a cartel, or price fixing structure. A major concern to many folks is the possibility that the credit card shown as being in a state of default may not simply be so. It very well could be the result of an error on the part of the credit card issuer. In cases such as this, the consumer may have full legal rights to have their credit report corrected to reflect the truth of the matter, the credit card issuers are under no obligation to revert the interest rate back to what it was before the mistake occured. It simply goes without saying that this sort of position leaves many credit card holders in a state not unlike that of anger. Simply put, this is not right.
Over the last few years there have been several attempts by concerned congressmen to simply have the practice of universal default outlawed. One such congressman was Sen. Chris Dodd, D-Conn. Yet, many credit card firms are some of the largest contributors to the various political parties. So seeking changes that will only benefit the rank and file noncontributing citizenry is not something that our congress is most famous for. It can be argued that in Washington money talks, as subtle corruption has been a part of legislative procedure for years. "I've never been able to get a bill passed of any major significance because they're so big and so influential," says Dodd.
The American Bankers Association, a free-trade and professional association that advocates issues deemed important by the banking industry in the United States has systematically been on the front of protecting the practice of universal default via it's Political Action Committees which use lobbyists to work for laws that are advantageous for the banking industry.
Credit card fees over the years recently have skyrocketed from $2.6 billion in 1980 to over $22.5 billion in 2006. The kicker that has most ticked off consumer advocates is a practice called "universal default". In this sytem when you find yourself late paying the bill, the card company might raise your interest rate to something that is well over 20 percent. There have been many criticisms of this structure including the concept of one lender charging a higher price when their customer defaults with another lender has been compared to having a cartel, or price fixing structure. A major concern to many folks is the possibility that the credit card shown as being in a state of default may not simply be so. It very well could be the result of an error on the part of the credit card issuer. In cases such as this, the consumer may have full legal rights to have their credit report corrected to reflect the truth of the matter, the credit card issuers are under no obligation to revert the interest rate back to what it was before the mistake occured. It simply goes without saying that this sort of position leaves many credit card holders in a state not unlike that of anger. Simply put, this is not right.
Over the last few years there have been several attempts by concerned congressmen to simply have the practice of universal default outlawed. One such congressman was Sen. Chris Dodd, D-Conn. Yet, many credit card firms are some of the largest contributors to the various political parties. So seeking changes that will only benefit the rank and file noncontributing citizenry is not something that our congress is most famous for. It can be argued that in Washington money talks, as subtle corruption has been a part of legislative procedure for years. "I've never been able to get a bill passed of any major significance because they're so big and so influential," says Dodd.
The American Bankers Association, a free-trade and professional association that advocates issues deemed important by the banking industry in the United States has systematically been on the front of protecting the practice of universal default via it's Political Action Committees which use lobbyists to work for laws that are advantageous for the banking industry.
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