Delinquent Payments
The most typical mistake that many people make when it comes to credit cards is to believe that a delinquent payment on their credit card is not important.  Some people think that the only consequence of a delinquent payment on their credit card is a penalty charge and are willing to pay the charge to avoid having to pay the minimum amount due on the credit card at that time.  These people do not realize that not paying a payment on time will also be reported on their credit report and will lower their credit score by a significant amount each time it occurs. 

Not Keeping Credit Card Information Secure
Another common mistake that many people make with their credit cards is to not keeping the information about their credit cards secure.  Preventing the information from being stolen by scam artists and thieves is simple as long as you are diligent about protecting your personal information.  These thieves know how to capitalize on common mistakes that people make when distracted or not paying attention to the information that they are giving out on the internet, on the phone, or by mail and can open many different credit accounts in a person’s name with a small amount of personal information disclosed.  It can take years to repair the damage that these thieves can do your credit score.

Not Paying Off The Balance Of The Credit Card
The best way to use your credit card is to only charge the amount that you are able to repay each month.  If you pay off the balance of your credit card each month, you will not only save a lot of money in interest payments but you will also raise your credit score by demonstrating that you know how to use credit responsibly.  The credit card companies may increase your credit limit so that you have more credit available if you need it because they know that you will repay them at an acceptable rate.

Maxing Out Credit Cards
Another common credit card mistake that many people make is to use most of their credit line or max out their credit cards.  Companies that issue credit card consider people that use more than 50% of their available credit to be a credit risk because the company assumes that the person is using their credit to extend their monthly salary and maintain their lifestyle and will not have the ability to pay the money back promptly because they are spending all of their salary plus more each month.  There have been many cases where a person was not allowed to take out a loan or an additional line of credit because they had used a more than 50% of their available credit and had been labeled as a credit risk by the credit card company

Paying Too High of an Interest Rate

A lot of people never take the time to re-shop their credit cards and see if they can get a better deal in terms of their interest rate and credit card rewards. Some people keep the same credit card for years, even when the terms become less favorable nad there are better deals out there. You’ll want to compare your credit cards with newly available cards every few years on sites like Consumer Reports to determine which is the best for you to have in your pocket.

1 Track Your Expenses.  You must do this first before you can begin to make wise choices about where your money is going.  Write down each and every expense for a whole month no matter how small it might seem.  What you will find is that you spend more money on frivolous things than you realize.  This will be an eye-opening experience.

2 Create a budget.  Now you can use your expense information from the first month to create a budget.  Create categories into which money will be placed from your income.  These categories will have names like housing, automobile, insurance, food, medical/dental, utilities, savings, entertainment, vacations, health care, etc.  Also, make sure you include a small amount of money for those impulse items you like to purchase.

3 Increase your savings.  There are three things you should focus on here.  First is an emergency cash fund.  This will be around $1,500.00 or so in order to cover those unforeseen emergencies, like the car breaking down, or the refrigerator going out, etc.  Next is a savings account into which you will accumulate money for income replacement in case of a medical or income loss need.  You will want to aim for three months of income in this account.  Finally, is your long-term or retirement account.  Saving as much as you can into this account is wise if your employer has a matching plan.  Finally, make savings an automatic task.  Find out if your employer allows you to deposit your paycheck via direct deposit into one or more accounts.  This way, you can allocate money into a savings account without ever having to touch it.

4 Clean up your credit.  If there are lingering items on your credit report that are keeping your score low, work on getting rid of those.  This will help if you find that you need to apply for a mortgage or auto loan.  You will get a much better interest rate which will save you money.

If you work on these items, you will slowly begin to see some changes not only in the amount of money you have, but in your attitude towards money as well.  You will begin to see it as a tool and not a task master.

Close To Collapse from Withdrawals 

The urgency became apparent after the executives at Wachovia realized that after the failure of Washington mutual, many of the larger corporate clients made an unusual number of withdrawals on their account. The majority of the withdrawal came from account containing more than $100,000. This severally paralyzed Wachovia’s access to operating capital.

Several Deals on the Table

Wachovia was approached by Citigroup, who offered a deal with assistance from the FDIC. The original agreement involved Citigroup purchasing Wachovia’s operations and the majority of the assets. The FDIC planned to aid the sale. The wheels were set in motion but never fulfilled. Wachovia has since changed tactics and made the agreement to be acquired by Wells Fargo. One of the main reasons this current action was taken was due to the ability of Wells Fargo to seal the deal without the help of the federal government. Wachovia reportedly is pleased with the arrangements because without the involvement of the government, Wachovia Bank can stay primarily intact and taxpayers would not have to help pick up the tab.

Wachovia has been on the chopping blocks for quite a while, many of their customers are concerned about the continuation and safety of their accounts. Customers lookign to move their credit cards and other accounts away from Wachovia can checkout services such as Credit Land to find accounts with banks which are more secure. 

The official bid was approved by the Wachovia Board on Thursday evening and must still be cleared by the shareholders of the bank. Wells Fargo does anticipate that government regulators will approve the deal and everything will be completed before 2009.

Make an Easy Plan.  The first small step you need to take is to get a small amount of cash on hand to handle some of those frustrating emergencies that pop up from time to time.  Shoot for between $1,000 and $1,500 in cash for emergency purposes. 

The best thing to do here is to sell some items in your home.  Look around for things you no longer need.  Gather them together and have a garage or yard sale.  You will be surprised at how quickly you can put together several hundred dollars.  But do not stop there. 

Once you have that little fund going, add to it by working a few odd jobs in your community like mowing some yards, cleaning a house or two, etc.  Create an Ad on a piece of paper (even if it is handwritten) and stick it up on the bulletin board in your favorite supermarket.  Write your phone number at the bottom in small strips vertically and cut them so that the reader can easily tear one off and take it home to call you.

Save Automatically.  Most employers will allow you to automatically deposit your paycheck into a bank account of your choice.  In fact, most will allow you to deposit specific amounts from your paycheck into different accounts.  Set up an account solely for the purpose of saving and then have a small amount automatically deposited into it from each paycheck.  Even $10.00 is a good start.

Prioritize Your Debts.  Now sit down and look at all of your debts.  Write down on a piece of paper the name of the creditor, and the amount owed.  Then sort that list (number each item) by the lowest to highest amount.

Pay off your smallest debt first while maintaining a minimum payment on the rest.  Then, once it is paid off, take that money you used to pay it off and tackle the next, higher amount and work on it until it is gone.  Before you know it, you will have paid off more than you could have imagined.  In this manner, you can avoid having to file for bankruptcy which will put a long-term spot on your credit history.

If you begin to take these steps and move towards a goal, you’ll eventually get there.  Doing nothing and take aim at nothing will get you nothing.  Start today and you will be on your way to financial stability sooner than you think.

While graduating from college is an exciting time, the reality of the cost of that education can bring one crashing back to earth quickly.  But, you are not without options.  Here are some different paths that you can take relative to your loan re-payment process.

Stafford loans can take from 10 to 25 years to repay depending on which payment plan you chose.  Your options were:

·         A standard payment plan with equal payments over 10 years.

·         A graduated plan with steadily increasing payments over 10 years.

·         An extended plan with fixed or graduated payments over 25 years available only if you borrowed more than $30,000.00.

·         And income-contingent plan with payments based on how much money you make.

The Perkins loan provides a standard 10 year repayment program only.

Stuck with It.  Those who have to stretch their payments over a longer period of time do so while placing a burden on themselves.  Their budget will be hampered by that monthly payment.  It will be more difficult to purchase a house or other major expense.  In fact, it is like a mortgage, except when the final payment is paid, you do not have a nice visible asset to show for it.  This is not to say that this route is wrong, but rather that it should be shunned if at all possible to pay off the balance of the loan sooner.

A disciplined person who pays off the loan as soon as possible is in a better position financially to move ahead.

Pay More Every Month.  You will begin to see the balance drop dramatically if you are able to place higher monthly payments on your education loan.  Work at a second job to earn more just for this purpose.  Throw as much money as you can at this loan until it is gone.  Deny yourself some of the ‘finer’ things in life until you get it paid off.

Then, once it is paid off, celebrate.  Throw a party bigger than your graduation!  Paying off a loan of this size shows discipline and determination.  You are to be commended.  As a matter of fact, you can visualize yourself with this loan payment and use those good feelings as a motivator.

Whatever path you chose, do not fail to recognize the incredible power of being master of your own money and not a slave to lenders.  It will help you direct your efforts in paying off your student loan which will help you be a better employee, too!

So, is there something we can hold on to that will help us navigate uncertain times?  What can we learn from the past that can help us today?

Stay the Course.  This cliché is so incredibly used that it works against the one who utters the words.  But it is true nonetheless.  Those who refuse to panic and succumb to fear are those who look long term and see that on the other side of the valley is a mountain.

Many people who have lost everything have come back to re-claim at least part of what they lost.  And they learned something in the process:  life is not all about money or material possessions.  In fact, a struggle is not a bad thing.  It can help bring to the forefront a new resolve and vigor to make things better.  This is a principle upon which our great nation was founded.  It might be time for us to re-learn this principle.

Value the Real Investments.  We tend to forget that our loved ones and relationships with people are more important that the amount of money we have in our 401k or other investments.  We lose sight of the impact of our actions upon our own children and what that impact has when it comes their turn to make important choices.  We look past teaching opportunities and hope that maybe they will pick them up somewhere else.

It is time to begin to think differently.  Yes, our money is important.  Yes, it is a great system that we have to help us prepare for our futures financially.  But let us return to the better part of life – that of our families.

Do Not Count Us Out.  America is a strong nation.  No matter what our enemies say about us.  We have the drive and resilience to come back even stronger than before when faced with adversity.  You do not have to look any further than 9/11 to validate that belief.

Even if we were to lose everything, American would be the quickest nation to turn around and come roaring back.  The reason is because the enterprising spirit is still alive.  People who have a determination to make changes for the better and improve on what we have are still alive and well.  That is a truth that will help us see through any hardship.  No matter how bad.

So, stay the course, value right things, and look to the future.  Our best days are ahead of us.

Most major purchase loans either require insurance or at least give the option to purchase insurance as a means of protection.  The rule of thumb is that if a purchase is a large amount (one in which that a financial loss could not be covered with cash on hand), then insurance should be considered.  For the purchase of a house or automobile, insurance is required by the lender in order for them to protect their investment as well.  However, less expensive items that are financed are subject to debate on whether or not they are good candidates for insurance coverage.

Loss Factor.  The first question to ask should be directed at the potential loss of the item in question.  If the financial impact incurred by the loss of the item exceeds the ability to pay out of pocket for its replacement, then insurance should be considered.  In addition, if one owns items of great sentimental, artistic or historic value, then insurance should be considered.  If an item is purchased for the express purpose of preserving life, health and/or safety then insurance also would be a wise choice.

Cost Factor.  Some insurance is not worth the cost given the nature of the item.  Often, you will find yourself being offered insurance on a piece of electronic equipment like a television.  The insurance providers make a bundle on this type of insurance.  Most consumer electronics are designed to rigorous quality standards such that if you have issues with the equipment, it would probably show up within the manufacturer’s warranty period which is normally one year.  If the loss of the item in question is only several hundred dollars, then insurance would be considered a waste of money.  Generally, entertainment items are not considered worthy of insuring unless they are part of maintaining the livelihood of the owner.

Minimal Cost.  The case in which the above could be discounted has to do with the total cost of the insurance.  A small amount under five percent of the cost of the item might render it a good candidate to be insured.  Especially if you can pay cash for that insurance and avoid rolling it into a monthly payment.

Insuring simply for convenience sake is not wise. Sometimes the loss underscores the importance of taking care of one’s property and is best left to the experience of the owner.  This might be the case in the course of family life where parents are attempting to school their children on the value of items and their ultimate care.

Whatever choices are made regarding insuring items which are under a loan agreement one must carefully weigh the risk and then make the wise choice.

It is Never Too Late.  Throwing up your hands in frustration and walking away from this topic is not a smart decision.  You can build up enough of a retirement even if you are starting in your fifties.  But, you have to begin now, and use techniques that will help you get to where you need to be in realistic terms.

Break Old Habits and Thought Patterns.  Set aside the ‘spend it now’ mindset for a ‘saving for the future’ one.  This is likely going to be one of the more difficult challenges to carry out, but once begun it will begin to take hold and become easier over time.

Find ways to reduce expenses and debt so that you can begin to allocate as much money as you can towards building your retirement.

Use the Tools You Have.  The two financial vehicles that you will need to focus on are your 401k and IRA accounts.  Your 401k is the best because of the company matching portion which gives you extra towards retirement without coming out of your pocket.  Max out your contributions to this account if at all possible.

The IRA continues to be a wonderful way to save (tax deferred and post-tax) towards retirement.  If you do not have a 401k plan, then use these accounts in place of them.

There is a way called ‘catch up’ contributions to save even more in the few years leading up to right before you retire.  Be sure to ask about this with your employer or with the institution that handles your IRA.

Balance Risk with Reward.  At no other time is the need to view the risk part of your investment strategy so important.  Since you are just getting started, you need to keep in mind that an aggressive risk strategy can open you up to losses that can be difficult from which to recover if the market takes a hit.  So, choose your mix of stocks, bonds and mutual funds carefully.  Remember that if you take a more conservative approach in your investment choices, you will end up with less at the end, but how much less is not near as important is that there is money there for you at retirement.  You might have to adjust your lifestyle downward somewhat, but better that scenario than to have very little upon which to make your retirement plans.

In short, take a very realistic approach when it comes to starting late in your retirement strategy.  Use clear thinking and keep in mind that it is NEVER too late to begin.

Here’s some easy things at which one can look in order to accomplish this task:

Start Small.  Look for what seems to be the lower, more trivial expenses that you can cut.  These items can be combined to give you some real relief:  Cell phones and extra charges like text messaging, and Internet / Multimedia access; Cable TV and the number of channels to which you subscribe; a small but consistent change in the temperature in which you keep your home; turning off all lights when leaving a room; turning off your computer when finished; combine the little trips you take around town.  What might seem trivial can add up over time.  Shop for clothing at a local thrift shop.  You can find great buys on almost new clothing for just pennies on the dollar to what it cost new.

Look Large.  Now, tackle some obvious, but painful expenses.  How about quitting smoking?  Or, cutting back on the amount of alcohol that you purchase?  Reduce your entertainment spending by not purchasing season tickets on your favorite team.  Trade in your gas-guzzling SUV or Truck for a more fuel efficient vehicle.  Compare rates on your automobile insurance.  You might be able to find the same or better coverage at a lower cost.

Refinance.  Look at refinancing your mortgage if it makes sense in your case.  You will need to consult a refinancing calculator to help with this one.  But, the savings can be substantial.

Cut Taxes.  You can challenge your real estate tax assessment and attempt to get the rate lowered thereby saving you potentially hundreds of dollars per year.  You must have evidence on your side, but the savings on this can make the effort worth the time.

These simple steps can help tip your budget towards the ‘black’ and help you begin to work your way out of debt, as well.  Use the extra to pay down your credit cards to a zero balance.  Then, pay off your auto loans.  You will have extra money to place into cash accounts to use in emergencies and for expense planning.

It does not take a lot to get started, just the will to make it happen.