Many US American citizens are still unaware of the free government money that is available to them each and every year. There are very few taxpaying citizens who do not qualify to receive government grant programs. Almost everyone in American is entitled to some reasonable portion of seventy nine billion dollars that the government awards each year, yet very few apply.
It is assume ably because not many are privy to just what may be dome with this money. Regardless of the fact that there have been hundreds of magnificently beneficial government grant programs available to US taxpayers for decades, the only ones that the common citizen seems to recognize are college grants. While it is a fantastic thing that everyone is aware that they may receive generous amounts of financial aid to pursue an advanced education, it is a shame that so many other solid opportunities continue to be overlooked.
In this article we will briefly examine just a few of the fabulous free money opportunities that are commonly surpassed by otherwise qualified applicants simply due to ignorance.
Single Parents Grants - There is a great deal of financial assistance provided to adults who take on the courageous responsibility of raising children alone. These free grants can be used for anything from child day care, to establishing a new business, to paying utility bills. The possibilities for single parents are seemingly endless with the help of Uncle Sam.
Grants For Real Estate - There are home grants, real estate grants, and first time homebuyer grants that can shave tens of thousands of dollars off of the sale price of a new building. Not to mention helping to pay past due mortgages and back taxes for those who are in need of that type of assistance.
Home Improvement Grants - American taxpayers that own homes that are in need of crucial repair, or just want to redecorate and remodel, can almost always achieve great deals of free government money to pay their contractors.
Personal Debt Relief Grants - This may be the most remarkable of them all. If you have overspent, no matter what the reason, the government may actually give you a boatload of free unclaimed money to settle the score with your creditors, and increase your credit rating to no end.
There are hundreds of other generous and beneficial government grants. These are only a few. By searching the national grants database you can find the numerous other free grant programs to find the ones for you.
Get Grants for Individuals and see how much money you qualify to receive today and never pay back.
Claim your Personal Grants...
Article Source: http://EzineArticles.com/?expert=Sarah_Beckham
วันอาทิตย์ที่ 31 พฤษภาคม พ.ศ. 2552
วันเสาร์ที่ 30 พฤษภาคม พ.ศ. 2552
Manage Your Money Flow
Managing your money flow is the second step of building your financial house. It is like building the frame that the rest of the home will be built around.
The concept of managing your money flow is basically making sure that your inflow of cash is less than your outflow of cash. This process is called budgeting. When you create and follow a budget, you are living within your current means and you will avoid accumulating new debt.
When you take the time to create and follow a budget, you begin to see where your money goes each month. Armed with that knowledge you can cut back on some of those wasteful spending habits and free up money to start moving towards your goals.
Managing Your Money Flow Will Help You Reach Your Financial Goals
When you follow a budget, you can allocate money to reaching your financial goals. Maybe you want to save for things like retirement or a down payment on a house. Perhaps you want to start saving money to start that business you've been dreaming of. When you follow a budget, you have a plan to get where you want to go. When you have a goal and plan to reach that goal, your chances of getting there are exponentially increased.
Managing Your Money Flow Will Prepare You for Future Wealth
If you are always running out of money with your current income, chances are that you will have the same problem even if you earn more. Statistically, the more money you earn, the more money you'll spend. This is called Parkinson's Law. If you do not learn to manage what you have now, earning more money will not solve the problem.
Don't be fooled by appearances. Many of those high income earners are broke. All of their income is going to pay for their big mortgage, the credit card bills, and the car loans. They are just broke at a different level.
Managing Your Money Flow Will Teach You Discipline
Wealthy people understand the importance of managing their money. They exercise self-discipline and they save up for purchases and earn interest on their savings while they do it. Broke people tend to go for instant gratification and buy things on credit. Often, whatever they buy ends up costing them twice as much by the time they finish paying for the credit card bill.
In the long run, saving up for purchases will actually allow you to buy twice as much stuff compared to buying with credit.
Alternatively, you could have the same amount of stuff, plus build up a big investment account on the side with all the money you save by not paying interest on debt.
Managing Your Money Flow: Conclusion
Over the years of working in the financial industry I have actually met a lot of low income earners that had higher net worths than many doctors and lawyers. This is simply because they managed their money well and allocated a portion each month to go into long-term savings or investments.
Budgeting is the basic building block of financial success. When you can manage your money successfully, you can allocate money to reach future financial goals. You will also be learning important money habits that will serve you well for your entire life, no matter how much you are earning.
It's all set up for you to project and track each month's income and expenses. Plus, it will automatically total your numbers for the entire year and present the data as a graph so you can see where your money is going.
If you would rather not be bothered with having to manually track everything yourself, check out the Quicken Personal Finance products. With their programs you can automate a lot of the manual tracking you have to do with the traditional budgeting spreadsheets. It will save you time and provide you with the information you need to manage your money well.
Action Items
Start managing your money flow by using a spreadsheet or automated software. Figure out how much money you have coming in each month and allocate it to your needs and goals.
Start tracking where your money is going and look for areas where you can reduce costs. Some easy ones are buying lunches and coffee. Cutting out five coffees each week could save you around $50 a month.
financepandit.com provides Free Finance Articles for Business and Finance Blogs
Article Source: http://EzineArticles.com/?expert=Dinesh_M_Patel
The concept of managing your money flow is basically making sure that your inflow of cash is less than your outflow of cash. This process is called budgeting. When you create and follow a budget, you are living within your current means and you will avoid accumulating new debt.
When you take the time to create and follow a budget, you begin to see where your money goes each month. Armed with that knowledge you can cut back on some of those wasteful spending habits and free up money to start moving towards your goals.
Managing Your Money Flow Will Help You Reach Your Financial Goals
When you follow a budget, you can allocate money to reaching your financial goals. Maybe you want to save for things like retirement or a down payment on a house. Perhaps you want to start saving money to start that business you've been dreaming of. When you follow a budget, you have a plan to get where you want to go. When you have a goal and plan to reach that goal, your chances of getting there are exponentially increased.
Managing Your Money Flow Will Prepare You for Future Wealth
If you are always running out of money with your current income, chances are that you will have the same problem even if you earn more. Statistically, the more money you earn, the more money you'll spend. This is called Parkinson's Law. If you do not learn to manage what you have now, earning more money will not solve the problem.
Don't be fooled by appearances. Many of those high income earners are broke. All of their income is going to pay for their big mortgage, the credit card bills, and the car loans. They are just broke at a different level.
Managing Your Money Flow Will Teach You Discipline
Wealthy people understand the importance of managing their money. They exercise self-discipline and they save up for purchases and earn interest on their savings while they do it. Broke people tend to go for instant gratification and buy things on credit. Often, whatever they buy ends up costing them twice as much by the time they finish paying for the credit card bill.
In the long run, saving up for purchases will actually allow you to buy twice as much stuff compared to buying with credit.
Alternatively, you could have the same amount of stuff, plus build up a big investment account on the side with all the money you save by not paying interest on debt.
Managing Your Money Flow: Conclusion
Over the years of working in the financial industry I have actually met a lot of low income earners that had higher net worths than many doctors and lawyers. This is simply because they managed their money well and allocated a portion each month to go into long-term savings or investments.
Budgeting is the basic building block of financial success. When you can manage your money successfully, you can allocate money to reach future financial goals. You will also be learning important money habits that will serve you well for your entire life, no matter how much you are earning.
It's all set up for you to project and track each month's income and expenses. Plus, it will automatically total your numbers for the entire year and present the data as a graph so you can see where your money is going.
If you would rather not be bothered with having to manually track everything yourself, check out the Quicken Personal Finance products. With their programs you can automate a lot of the manual tracking you have to do with the traditional budgeting spreadsheets. It will save you time and provide you with the information you need to manage your money well.
Action Items
Start managing your money flow by using a spreadsheet or automated software. Figure out how much money you have coming in each month and allocate it to your needs and goals.
Start tracking where your money is going and look for areas where you can reduce costs. Some easy ones are buying lunches and coffee. Cutting out five coffees each week could save you around $50 a month.
financepandit.com provides Free Finance Articles for Business and Finance Blogs
Article Source: http://EzineArticles.com/?expert=Dinesh_M_Patel
วันศุกร์ที่ 29 พฤษภาคม พ.ศ. 2552
The Future is Going Direct (Banking)
What is common among the following banks? ING Direct (Canada), Tesco Personal Finance (UK), The One Account (UK), IYBank (Japan), Citizens Bank of Canada (Canada), Banque Directe (France), President's Choice Financial (Canada), Inteligo (Poland), and Egg (UK).
They have 2 threads in common; one, all of them are success stories of banks going the 'Direct' way and two, they have been least touched by the recent global banking crisis. Well, there is another thread that binds them. They were all featured in the 'Direct Banking Case Studies' of Celent way back in December 2004. In its report, Celent examined the level of success of these aforementioned direct banks closely and concluded that direct banking did prove a viable alternative to penetrate new markets and garner customer wallet share.
Direct banking has come long way from the holiday season of 2004 to the Good Friday of 2009. Today, direct banking is gaining ground in the financial services market with a vengeance. Vengeance, I say because the mantra for banks today is to make huge savings on operational costs and the best way is to cut down on their branch operations while finding ways to reach prospects and customers. And if you thought going direct meant losing personal touch, and abating trust and negatively impacting the confidence that your branch has been providing to your customers all along - then you are mistaken, provided you are doing it the right way. Classic cases are ING Direct and Inteligo in Poland.
ING Direct was successful in adopting the local flavor for their products in all the countries they operated. The experience of Inteligo in Poland also shows that as long as the customers get convenient offers, they prefer to bank directly, rather than turning up at the branches.
The first worry that could come to your mind, as you plan to go 'direct' is the technology infrastructure. The good news is that, technology enables you to go 'direct'. However; your success is determined by how smoothly you balance your customer relationships with the technology innovations. In short your relationship with your customers is the key.
For relationships to have any meaning and for banks to make the best of any channel, particularly the Direct Banking strait, they should be able to see customers as whole and not mere pieces of a jigsaw puzzle. This implies having a 360-degree view of customer.
Banks need the ability to calculate the total value of customers on all business done across all channels - which in turn, would allow them to get the larger picture of customer usage and necessities pattern. Banks while going direct should provide customers with the supreme banking experience according to their necessities, consistently across are direct channels be it phone, net, ATM or mobile.
With Direct Banking 'Targeted Banking' becomes easier and much more efficient. While the right product offering gives banks the platform for direct banking success, a wrong product proposition can harm its plans to go direct. Using a direct banking platform, even this risk can be declined by letting the customer choose his banking mix. On studying the cases of successful direct banks it is clear that, retaining and rewarding loyalty is also a must.
The towering strengths of direct banking is operational cost savings and the fact that the bank is able to provide its customer exactly what he or she wants in his or her space and time. At the end of the day the strength of a bank is in getting the maximum wallet share of the customer and the slogan of direct banking is perfectly in tandem: "Dear Customer - you choose the way you bank and when you bank"!
Rajesh B L Narasimha
Vice President - Sales
SunTec Business Solutions
As Vice President for Sales, Rajesh B L Narasimha oversees business development in Asia Pacific and Middle East Regions for the Banking and Financial Services vertical at SunTec Business Solutions. Rajesh is a senior banking domain subject matter expert and he has greatly contributed in advising customers on exploiting the value proposition of SunTec's Relationship-based Pricing product TBMS-F, for enhanced profitability and growth. Prior to joining SunTec, in 2006, Rajesh brought in over 13 years of experience working with leading IT companies like Wipro, Compaq and Polaris at senior levels of which a decade was focused in Banking and Financial Services domain.
Article Source: http://EzineArticles.com/?expert=Rajesh_B_L_Narasimha
They have 2 threads in common; one, all of them are success stories of banks going the 'Direct' way and two, they have been least touched by the recent global banking crisis. Well, there is another thread that binds them. They were all featured in the 'Direct Banking Case Studies' of Celent way back in December 2004. In its report, Celent examined the level of success of these aforementioned direct banks closely and concluded that direct banking did prove a viable alternative to penetrate new markets and garner customer wallet share.
Direct banking has come long way from the holiday season of 2004 to the Good Friday of 2009. Today, direct banking is gaining ground in the financial services market with a vengeance. Vengeance, I say because the mantra for banks today is to make huge savings on operational costs and the best way is to cut down on their branch operations while finding ways to reach prospects and customers. And if you thought going direct meant losing personal touch, and abating trust and negatively impacting the confidence that your branch has been providing to your customers all along - then you are mistaken, provided you are doing it the right way. Classic cases are ING Direct and Inteligo in Poland.
ING Direct was successful in adopting the local flavor for their products in all the countries they operated. The experience of Inteligo in Poland also shows that as long as the customers get convenient offers, they prefer to bank directly, rather than turning up at the branches.
The first worry that could come to your mind, as you plan to go 'direct' is the technology infrastructure. The good news is that, technology enables you to go 'direct'. However; your success is determined by how smoothly you balance your customer relationships with the technology innovations. In short your relationship with your customers is the key.
For relationships to have any meaning and for banks to make the best of any channel, particularly the Direct Banking strait, they should be able to see customers as whole and not mere pieces of a jigsaw puzzle. This implies having a 360-degree view of customer.
Banks need the ability to calculate the total value of customers on all business done across all channels - which in turn, would allow them to get the larger picture of customer usage and necessities pattern. Banks while going direct should provide customers with the supreme banking experience according to their necessities, consistently across are direct channels be it phone, net, ATM or mobile.
With Direct Banking 'Targeted Banking' becomes easier and much more efficient. While the right product offering gives banks the platform for direct banking success, a wrong product proposition can harm its plans to go direct. Using a direct banking platform, even this risk can be declined by letting the customer choose his banking mix. On studying the cases of successful direct banks it is clear that, retaining and rewarding loyalty is also a must.
The towering strengths of direct banking is operational cost savings and the fact that the bank is able to provide its customer exactly what he or she wants in his or her space and time. At the end of the day the strength of a bank is in getting the maximum wallet share of the customer and the slogan of direct banking is perfectly in tandem: "Dear Customer - you choose the way you bank and when you bank"!
Rajesh B L Narasimha
Vice President - Sales
SunTec Business Solutions
As Vice President for Sales, Rajesh B L Narasimha oversees business development in Asia Pacific and Middle East Regions for the Banking and Financial Services vertical at SunTec Business Solutions. Rajesh is a senior banking domain subject matter expert and he has greatly contributed in advising customers on exploiting the value proposition of SunTec's Relationship-based Pricing product TBMS-F, for enhanced profitability and growth. Prior to joining SunTec, in 2006, Rajesh brought in over 13 years of experience working with leading IT companies like Wipro, Compaq and Polaris at senior levels of which a decade was focused in Banking and Financial Services domain.
Article Source: http://EzineArticles.com/?expert=Rajesh_B_L_Narasimha
วันพฤหัสบดีที่ 28 พฤษภาคม พ.ศ. 2552
How to Find a Good Accountant
Finding a good accountant for your personal or business finances is an extremely important thing to do. You should look into getting an accountant for your business as soon as you setup your work, so that all important financial records can be properly kept up-to-date. Also, if you feel that it is not possible for you to manage your personal finances, specially filing taxes, you should hire an accountant in order to avoid any problems.
Finding a good accountant is not a very difficult thing to do. You just need to make sure that you take your needs, finances, and amount of work in to consideration before you start your hunt. Possibilities are there that you may not need a very experienced accountant in case you need him only for your personal finances.
To start looking for an accountant, first make a list of accountants that you have been referred to. Ask your banker, insurance agent, friends and family for accountants they have worked with and whom they think would be a good fit for your needs.
Call the accountants that are on your list and have conversations with them regarding the kind of services they provide, the size of their firm, their experience as well as their educational background. You should also find out how much they charge so that you can make sure you can afford their services.
Shortlist the most qualified and suitable candidates for your needs. This should reflect how much they charge, how efficient they were in dealing with your questions, and whether or not they have the right amount of experience.
In the end, you need to sit down and interview the candidates enlisted in the shortlist. In this interview, you should ask about who in their firm will handle your accounts, and whether they will give you an analysis of your financial statements as well. Basically, in this interview you need to figure out exactly what you will get when you sign up with them.
The last steep is the decision which accountant is the best for your needs. He must be appropriate to suit your work requirements, must be most efficient, and finally and most importantly meet your budget requirements.
Some important things to keep in mind when selecting an accountant:
- This person will do more than just prepare your documents for taxes. He will provide you with financial information that will affect the business decisions you make for your family and company. So, make sure you select someone whom you can trust and rely upon.
- If you are selecting an accountant for a business, talk to other business owners you know in the same industry for an accountant they can refer you.
- Find out if there have been any complaints against the accountants you are considering by asking relevant agencies.
- Call your local professional licensing board to make sure the accountant you are considering has the right license.
Are you looking for reliable Accountants Manchester area? Visit http://www.christiandouglass.com for all your accounts and tax related issues
Article Source: http://EzineArticles.com/?expert=Paul_M_Smith
Finding a good accountant is not a very difficult thing to do. You just need to make sure that you take your needs, finances, and amount of work in to consideration before you start your hunt. Possibilities are there that you may not need a very experienced accountant in case you need him only for your personal finances.
To start looking for an accountant, first make a list of accountants that you have been referred to. Ask your banker, insurance agent, friends and family for accountants they have worked with and whom they think would be a good fit for your needs.
Call the accountants that are on your list and have conversations with them regarding the kind of services they provide, the size of their firm, their experience as well as their educational background. You should also find out how much they charge so that you can make sure you can afford their services.
Shortlist the most qualified and suitable candidates for your needs. This should reflect how much they charge, how efficient they were in dealing with your questions, and whether or not they have the right amount of experience.
In the end, you need to sit down and interview the candidates enlisted in the shortlist. In this interview, you should ask about who in their firm will handle your accounts, and whether they will give you an analysis of your financial statements as well. Basically, in this interview you need to figure out exactly what you will get when you sign up with them.
The last steep is the decision which accountant is the best for your needs. He must be appropriate to suit your work requirements, must be most efficient, and finally and most importantly meet your budget requirements.
Some important things to keep in mind when selecting an accountant:
- This person will do more than just prepare your documents for taxes. He will provide you with financial information that will affect the business decisions you make for your family and company. So, make sure you select someone whom you can trust and rely upon.
- If you are selecting an accountant for a business, talk to other business owners you know in the same industry for an accountant they can refer you.
- Find out if there have been any complaints against the accountants you are considering by asking relevant agencies.
- Call your local professional licensing board to make sure the accountant you are considering has the right license.
Are you looking for reliable Accountants Manchester area? Visit http://www.christiandouglass.com for all your accounts and tax related issues
Article Source: http://EzineArticles.com/?expert=Paul_M_Smith
วันพุธที่ 27 พฤษภาคม พ.ศ. 2552
75 Billion Given Out For Obama's Home Affordable Program - What is It?
Recently the government started giving out $75 billion to banks to help people that are struggling with keeping their house. The Home Affordable Program was created to help people that are behind on payments or are facing foreclosure. The $75 billion is giving to the banks so that they could off set the cost of modifying house owners loans. So what is modifying a loan mean? Well each case is unquie but basically banks will reduce interest rates, or back end payments so that house owners will not fall into foreclosure.
From a house owners point of view when you fall behind of payments you should contact your bank immediately and work on sending in a home modification application, this is the first step in saving your house. Of course banks are severly bogged down, creating a bottle neck of applications and long delays to this process. Besides loan modifications there is also a home refinance program, even if you are over/under on your house, the program is set up for you to help save your house, of course the bank losses some money but its better then another bank foreclosure in which everyone losses.
As good as the program sounds there seems to be many problems such as communication with banks, delays in applications, and the requirements for being approved for a modified house loan. Check out this site Making Home Affordable this government web site gives detailed information if you are eligible for these benefits, it is a difficult time and anything will help. The site also recommends that you look into a housing counselor they can help guide you in the right direction. As much as I like the idea of helping people from getting foreclosed on their house, is this the right way to do it?
It seems to me the banks were a major cause of the housing crash because of sub-prime loans and very loose regulations on giving out loans, is it smart to give them billions of dollars to help get people out of trouble that they helped put them in? Could have the government have used a different system? Worst of all banks are over their head in paper work and helping house owners, it seems like this could be a very drawn out process. What do you think?
http://www.easycreditcardinformation.com/
http://easycreditinformation.com/
Article Source: http://EzineArticles.com/?expert=Cage_Stevens
From a house owners point of view when you fall behind of payments you should contact your bank immediately and work on sending in a home modification application, this is the first step in saving your house. Of course banks are severly bogged down, creating a bottle neck of applications and long delays to this process. Besides loan modifications there is also a home refinance program, even if you are over/under on your house, the program is set up for you to help save your house, of course the bank losses some money but its better then another bank foreclosure in which everyone losses.
As good as the program sounds there seems to be many problems such as communication with banks, delays in applications, and the requirements for being approved for a modified house loan. Check out this site Making Home Affordable this government web site gives detailed information if you are eligible for these benefits, it is a difficult time and anything will help. The site also recommends that you look into a housing counselor they can help guide you in the right direction. As much as I like the idea of helping people from getting foreclosed on their house, is this the right way to do it?
It seems to me the banks were a major cause of the housing crash because of sub-prime loans and very loose regulations on giving out loans, is it smart to give them billions of dollars to help get people out of trouble that they helped put them in? Could have the government have used a different system? Worst of all banks are over their head in paper work and helping house owners, it seems like this could be a very drawn out process. What do you think?
http://www.easycreditcardinformation.com/
http://easycreditinformation.com/
Article Source: http://EzineArticles.com/?expert=Cage_Stevens
วันอังคารที่ 26 พฤษภาคม พ.ศ. 2552
How to Organize and Manage Your Household Bills
Don't we all just tend to procrastinate when it comes to bill payment? It is just so hard to keep up with due dates and organize all these paper bills while it is just so easy to "take care of them later", isn't it? We are bound to lose the bills and then pay for excess fee due to late payment. There is no way out it seems. But wait, don't you think it is time to change?
Bill payment is not such an exciting task. A lot of people would not take joy when given the task of organising and paying the household bills. But do you know that bill payment need not be a haunting task? If you know how to organize and manage your household bills, it will not be a pain to do it. In fact, it will only take a few minutes of your time.
So how do you organize and manage your household bills? Follow these easy steps:
• You should be very consistent. Delegate a particular area or even better, buy a small box, to make it a permanent storing area for the household bills. One common mistake among bill payers is that they put the bills just anywhere around the house. Some of the bills are stacked on the fridge, others are kept beside bed lamps, others are on drawers and still others are kept in between recipe books. This makes you forget your bills and lose them eventually - the result? Missed due dates and higher bills (regular bill amount plus extra late fee). Whereas if you have a single area to keep the bills, there is no chance that you're going to lose another bill. As soon as you receive a bill, keep it in your "bill storage" area.
• You should set a schedule. Allocate a scheduled day of the week to review the bills and pay for them in case they are already due. It will only take a few minutes of your time. And remember, don't procrastinate! If you have set a particular day to review and pay for your bills, do it. Don't leave it for later! Choose a day that you are not too busy.
• Pay the bills on time. You may realize that some bills can be paid online. This means you don't have to leave your favorite couch to pay for your bills. All bills with the same or almost the same due date can be paid at once. This means going out once if there is a need to pay for them personally.
These easy steps will help you organize and manage your household bills. See, bill payment is not too bad after all. But when things go bad and you can't handle it on your own, there is always the bill payment service!
Homepayments.ie is Ireland's leading household financial management company. It offers successful finance management solutions that help you save money, time and effort. See Bill Paying Service to get a free finance consultation with one of Homepayments.ie qualified consultants.
Article Source: http://EzineArticles.com/?expert=Wer_Wery
Bill payment is not such an exciting task. A lot of people would not take joy when given the task of organising and paying the household bills. But do you know that bill payment need not be a haunting task? If you know how to organize and manage your household bills, it will not be a pain to do it. In fact, it will only take a few minutes of your time.
So how do you organize and manage your household bills? Follow these easy steps:
• You should be very consistent. Delegate a particular area or even better, buy a small box, to make it a permanent storing area for the household bills. One common mistake among bill payers is that they put the bills just anywhere around the house. Some of the bills are stacked on the fridge, others are kept beside bed lamps, others are on drawers and still others are kept in between recipe books. This makes you forget your bills and lose them eventually - the result? Missed due dates and higher bills (regular bill amount plus extra late fee). Whereas if you have a single area to keep the bills, there is no chance that you're going to lose another bill. As soon as you receive a bill, keep it in your "bill storage" area.
• You should set a schedule. Allocate a scheduled day of the week to review the bills and pay for them in case they are already due. It will only take a few minutes of your time. And remember, don't procrastinate! If you have set a particular day to review and pay for your bills, do it. Don't leave it for later! Choose a day that you are not too busy.
• Pay the bills on time. You may realize that some bills can be paid online. This means you don't have to leave your favorite couch to pay for your bills. All bills with the same or almost the same due date can be paid at once. This means going out once if there is a need to pay for them personally.
These easy steps will help you organize and manage your household bills. See, bill payment is not too bad after all. But when things go bad and you can't handle it on your own, there is always the bill payment service!
Homepayments.ie is Ireland's leading household financial management company. It offers successful finance management solutions that help you save money, time and effort. See Bill Paying Service to get a free finance consultation with one of Homepayments.ie qualified consultants.
Article Source: http://EzineArticles.com/?expert=Wer_Wery
วันจันทร์ที่ 25 พฤษภาคม พ.ศ. 2552
Banks! And Why They Bug Me!
Banks were originally created as a secure place to keep our savings from harms way.
Banks made their money, by using our money, to finance other peoples borrowings. In return for having the use of our money, banks paid us a small interest. This system worked perfectly for several hundred years.
Some thirty odd years ago, bank regulations were relaxed, and not long after that, the whole process had been completely reversed. Today's banks do not pay us to use our money, we pay them for the privilege of having our money used by them. Obviously, a change like that didn't happen overnight.
It started with the introduction of what was called paid bank services. In return we were offered better terms of interest. It seemed like a fair trade, at the time. The thing about bank services is no one really explained what they were, or why they were good for us, they simply called them services.
Today we call such 'services', value added fees and charges. They come about when you add value to an action which has no value to begin with. Then you create a charge for it. It can be something as simple as the click of a mouse, or as complicated as a few steps to and from the copy machine. So, like most things under the control of accountants, the fees and charges grew at a great pace. It was not long before the interest rate we were paid, barely covered the charges.
Obviously, banks do not want us to call their conduct the 21st century version of Piracy. Well, some of them don't seem to mind that. But essentially they are regular folk, who would like our sympathy: All they really want, is to be rich, powerful and free from government and customer scrutiny. Who can blame them for hiding in the back offices? Naked greed is very unattractive.
To justify all their charges, banks had to come up with something tangible. So they created The Credit Card. A stroke of genius, which enabled every person on the planet to go into really serious debt. This product became so popular that the banks felt it deserved something special, a super high interest rate - and so it was!
Staff of course, was always a great burden to the banks. Again the big brains went to work and came up with the universal ATM machine. Free to customers they said. And it was, for a little while, till most of us had learned to accept this new technology. It was not long before the number of bank tellers shrunk and the queues inside the banks got longer. Bank teller transactions soon became subject to charges. So, like well trained seals, we finally got ourselves a transaction card, so we could queue at a free ATM outside, just in time to start to get charged for it.
Did the banks anger us? Absolutely, but mostly we got over it it. We did not want our new found conveniences to be disturbed, or delayed. Not then, when we had just gotten used to them. But how do we feel about the banks now?
They have pushed us into a recession. They cry poor while they choke on a big feed of tax payer dollars. They will cost the nations hundreds of thousands of jobs. They have brutally evicted people from their homes to recover property, against money they well knew, should never have been loaned out in the first place.
Governments say they have no choice. They have to keep these parasites on a drip feed, because it seems, we have become so addicted to banks we cannot live without them. They say our society would crumble overnight if we lost a few Banks.
Does that make sense? Not to me. Banks do nothing during a recession except to tighten their rules, apply fees and charges to customers accounts and repossess properties as soon as owners default. None of that is going to help the economy. Is it?
Maybe, instead of bailing out the banks, the government could bail out their customers. They could salvage, or replace all the cash and assets, belonging to customers, and lost by the banks. It would put money back in the pockets of people who will actually keep it in circulation. Something those toxic bankers have no desire to do till the economy is back on its feet.
People are perfectly capable of transferring themselves to a solvent bank. They just don't want to lose their hard earned money in the process. People will tolerate a lot, but no matter what the intentions, they will rarely tolerate wasteful incompetence and untruthful explanations.
Ask yourself this question: What lessons will the directors, who sit on the boards of those toxic banks, learn from their experience? A renewed respect for government regulation - or - a social conscious? I don't think so! Let's not forget, these are the people who have been both the cause and effect of the current economic crises. Yet, they brazenly continue to pay themselves for their "work".
It would not be the first time large banks have gone under. Britain did not go into recession when one of their Largest and best know banks lost billions and toppled. Similar failures have happened in other countries without causing a financial upheaval. And, let us not forget, despite all the bailout money, to prop up the banks, we're now in a worldwide recession. Does that not tell us anything?
Lets get real. Where there are people with money to save, there will be solvent banks ready to grab it. We can only hope they will show more prudence than the last lot. A little humanity would not hurt either.
Kirsten Plotkin is an expert writer and author. Her writing is focused heavily on the experience she has gained, both good and bad in the course of running her internet business. She believes she can help many new marketers avoid those costly pitfalls they are otherwise likely to fall into. Kirsten can be contacted at her blog, where she is happy to answer questions.
http://www.worldwide-home-business-opportunity.com/
Or email: kirstenplotkin@gmail.com
Article Source: http://EzineArticles.com/?expert=Kirsten_Plotkin
Banks made their money, by using our money, to finance other peoples borrowings. In return for having the use of our money, banks paid us a small interest. This system worked perfectly for several hundred years.
Some thirty odd years ago, bank regulations were relaxed, and not long after that, the whole process had been completely reversed. Today's banks do not pay us to use our money, we pay them for the privilege of having our money used by them. Obviously, a change like that didn't happen overnight.
It started with the introduction of what was called paid bank services. In return we were offered better terms of interest. It seemed like a fair trade, at the time. The thing about bank services is no one really explained what they were, or why they were good for us, they simply called them services.
Today we call such 'services', value added fees and charges. They come about when you add value to an action which has no value to begin with. Then you create a charge for it. It can be something as simple as the click of a mouse, or as complicated as a few steps to and from the copy machine. So, like most things under the control of accountants, the fees and charges grew at a great pace. It was not long before the interest rate we were paid, barely covered the charges.
Obviously, banks do not want us to call their conduct the 21st century version of Piracy. Well, some of them don't seem to mind that. But essentially they are regular folk, who would like our sympathy: All they really want, is to be rich, powerful and free from government and customer scrutiny. Who can blame them for hiding in the back offices? Naked greed is very unattractive.
To justify all their charges, banks had to come up with something tangible. So they created The Credit Card. A stroke of genius, which enabled every person on the planet to go into really serious debt. This product became so popular that the banks felt it deserved something special, a super high interest rate - and so it was!
Staff of course, was always a great burden to the banks. Again the big brains went to work and came up with the universal ATM machine. Free to customers they said. And it was, for a little while, till most of us had learned to accept this new technology. It was not long before the number of bank tellers shrunk and the queues inside the banks got longer. Bank teller transactions soon became subject to charges. So, like well trained seals, we finally got ourselves a transaction card, so we could queue at a free ATM outside, just in time to start to get charged for it.
Did the banks anger us? Absolutely, but mostly we got over it it. We did not want our new found conveniences to be disturbed, or delayed. Not then, when we had just gotten used to them. But how do we feel about the banks now?
They have pushed us into a recession. They cry poor while they choke on a big feed of tax payer dollars. They will cost the nations hundreds of thousands of jobs. They have brutally evicted people from their homes to recover property, against money they well knew, should never have been loaned out in the first place.
Governments say they have no choice. They have to keep these parasites on a drip feed, because it seems, we have become so addicted to banks we cannot live without them. They say our society would crumble overnight if we lost a few Banks.
Does that make sense? Not to me. Banks do nothing during a recession except to tighten their rules, apply fees and charges to customers accounts and repossess properties as soon as owners default. None of that is going to help the economy. Is it?
Maybe, instead of bailing out the banks, the government could bail out their customers. They could salvage, or replace all the cash and assets, belonging to customers, and lost by the banks. It would put money back in the pockets of people who will actually keep it in circulation. Something those toxic bankers have no desire to do till the economy is back on its feet.
People are perfectly capable of transferring themselves to a solvent bank. They just don't want to lose their hard earned money in the process. People will tolerate a lot, but no matter what the intentions, they will rarely tolerate wasteful incompetence and untruthful explanations.
Ask yourself this question: What lessons will the directors, who sit on the boards of those toxic banks, learn from their experience? A renewed respect for government regulation - or - a social conscious? I don't think so! Let's not forget, these are the people who have been both the cause and effect of the current economic crises. Yet, they brazenly continue to pay themselves for their "work".
It would not be the first time large banks have gone under. Britain did not go into recession when one of their Largest and best know banks lost billions and toppled. Similar failures have happened in other countries without causing a financial upheaval. And, let us not forget, despite all the bailout money, to prop up the banks, we're now in a worldwide recession. Does that not tell us anything?
Lets get real. Where there are people with money to save, there will be solvent banks ready to grab it. We can only hope they will show more prudence than the last lot. A little humanity would not hurt either.
Kirsten Plotkin is an expert writer and author. Her writing is focused heavily on the experience she has gained, both good and bad in the course of running her internet business. She believes she can help many new marketers avoid those costly pitfalls they are otherwise likely to fall into. Kirsten can be contacted at her blog, where she is happy to answer questions.
http://www.worldwide-home-business-opportunity.com/
Or email: kirstenplotkin@gmail.com
Article Source: http://EzineArticles.com/?expert=Kirsten_Plotkin
วันอาทิตย์ที่ 24 พฤษภาคม พ.ศ. 2552
Free Home Repairs & Improvement Grants - How to Get Free Federal Grants For Home Improvement?
The US economy is going through a major stress for the past few years. Now the Federal government has decided to help them by providing plans that enhance 'affordability.' The Stimulus Package introduced by President Obama is the first step in this direction. This package provides several options to the house owners in order to save their homes from foreclosure. These include tax rebates, loans, etc. They can choose the best suited option for themselves out of all these. Now you can repair and improve your homes with the help of the Federal free home repairs grants and home improvement grants.
Free Home Repairs Grants
You may visit your City Hall to get the idea on what your local government is offering for you. Few of the grants would help you get the cash required to rehabilitate or even expand the house. The HUD (US Housing and Urban development) department will provide you all the information regarding these free home repairs grants and will also assist you financially. There are certain guidelines that must be met to get this government aid. These guidelines vary from state to state. In some cases having your home business may help you get the money provided you need to build a home office for the business. You can apply for these funds online as well. Never forget to give a call to your local county office to help you in this matter
Home Improvement Grants
FEMA (Federal Emergency management Agency) provides housing assistance to all the families that are affected by the natural disasters. HUD and the FHA (Federal Housing Administration) help you get these grants. You may visit the official website of HUD to get all the information and to apply. The other option is to contact the local municipality for these home improvement grants. These are especially available for the senior citizens.
To know more about Federal Grants For Home Improvement and to check if you qualify for the same
Click Here --> Home Improvement Grant Programs
Government Grants may not be enough, you also need add new income sources. Try the free trial for Google Cash & learn the secret for earning thousands of dollars per month online.
Click Here --> Google Cash Free Trial
FREE Trials are for a limited time only, so get yours today.
Article Source: http://EzineArticles.com/?expert=Sani_Orman
Free Home Repairs Grants
You may visit your City Hall to get the idea on what your local government is offering for you. Few of the grants would help you get the cash required to rehabilitate or even expand the house. The HUD (US Housing and Urban development) department will provide you all the information regarding these free home repairs grants and will also assist you financially. There are certain guidelines that must be met to get this government aid. These guidelines vary from state to state. In some cases having your home business may help you get the money provided you need to build a home office for the business. You can apply for these funds online as well. Never forget to give a call to your local county office to help you in this matter
Home Improvement Grants
FEMA (Federal Emergency management Agency) provides housing assistance to all the families that are affected by the natural disasters. HUD and the FHA (Federal Housing Administration) help you get these grants. You may visit the official website of HUD to get all the information and to apply. The other option is to contact the local municipality for these home improvement grants. These are especially available for the senior citizens.
To know more about Federal Grants For Home Improvement and to check if you qualify for the same
Click Here --> Home Improvement Grant Programs
Government Grants may not be enough, you also need add new income sources. Try the free trial for Google Cash & learn the secret for earning thousands of dollars per month online.
Click Here --> Google Cash Free Trial
FREE Trials are for a limited time only, so get yours today.
Article Source: http://EzineArticles.com/?expert=Sani_Orman
วันเสาร์ที่ 23 พฤษภาคม พ.ศ. 2552
Dispelling a Myth That Will Help You Get Out of Debt
There are many reasons that most of us have debt. Some debts are unavoidable, like your home mortgage, or car payment. What is common are some attitudes we have about debt, and what is acceptable. Changing the way we think about carrying debt can ultimately help us get out of debt.
One of the most common myths about money and personal finance is that we can or should buy something because we deserve it. We have this false sense of entitlement in regards to our spending that causes us to create debt problems. We think that since we work really hard for something, we deserve to buy it regardless of cost.
This myth can be particularly challenging for those of us who have a tight financial balance. If you are someone who has difficulty saving but generally manages the rest of their finances well, you may buy things on credit and create unnecessary debt.
Let's say you have been in the market for a home computer for a while. One day you notice an ad in the local paper that talks about a weekend sale on home computers. Naturally, you rush down to the store that placed the ad to check out the possible deals.
When you get to the store, you quickly see all of the great specials on home computers. You are also able to quickly identify a model that is well within your price range. This model has most of the features you want, and has all of the must-haves.
Not far away from the reasonably priced model, you spot the grand pooh-bah of home computers. This model has everything you want and need in a home computer, plus many features that you only dreamed and heard about. This computer is more than you have saved and budgeted for.
You know it costs more than you intended to spend, but since you can get it on a store credit card, you buy it anyway. Hey, you work hard; you provide for your family and acknowledged that you would need the more expensive model to accommodate your family's usage.
You work hard, your family needs it, and therefore, you deserve this more expensive computer right? Wrong! You deserve a computer that works for your needs and that works for your budget. By getting the more expensive computer, you created more debt for yourself. You also put unnecessary pressure on yourself to work harder in order to pay for the added expense.
By convincing yourself that the more expensive unit is worth the added burden of paying for it, you have endorsed the theory that you deserve the best money can buy. What has really happened is that you allowed your desire for a new computer outweigh your sense of practical and normal spending habits
The way we should look at scenarios like this one is to recognize that any form of debt, no matter how big or small, is bad. We should also note that while we had enough money saved to buy an adequate computer, we chose to burden ourselves with the more expensive model.
We can overcome this set-back by being willing to limit our purchases on things we want and focusing on buying only what we need. By limiting our spending to things we need from those we want, we will be able to save more, which means we can eventually get out of debt.
http://www.giftfromraymond.com has been teaching his true wealth secrets for over a quarter-century so you can double your income doing what you love.
Article Source: http://EzineArticles.com/?expert=Raymond_Aaron
One of the most common myths about money and personal finance is that we can or should buy something because we deserve it. We have this false sense of entitlement in regards to our spending that causes us to create debt problems. We think that since we work really hard for something, we deserve to buy it regardless of cost.
This myth can be particularly challenging for those of us who have a tight financial balance. If you are someone who has difficulty saving but generally manages the rest of their finances well, you may buy things on credit and create unnecessary debt.
Let's say you have been in the market for a home computer for a while. One day you notice an ad in the local paper that talks about a weekend sale on home computers. Naturally, you rush down to the store that placed the ad to check out the possible deals.
When you get to the store, you quickly see all of the great specials on home computers. You are also able to quickly identify a model that is well within your price range. This model has most of the features you want, and has all of the must-haves.
Not far away from the reasonably priced model, you spot the grand pooh-bah of home computers. This model has everything you want and need in a home computer, plus many features that you only dreamed and heard about. This computer is more than you have saved and budgeted for.
You know it costs more than you intended to spend, but since you can get it on a store credit card, you buy it anyway. Hey, you work hard; you provide for your family and acknowledged that you would need the more expensive model to accommodate your family's usage.
You work hard, your family needs it, and therefore, you deserve this more expensive computer right? Wrong! You deserve a computer that works for your needs and that works for your budget. By getting the more expensive computer, you created more debt for yourself. You also put unnecessary pressure on yourself to work harder in order to pay for the added expense.
By convincing yourself that the more expensive unit is worth the added burden of paying for it, you have endorsed the theory that you deserve the best money can buy. What has really happened is that you allowed your desire for a new computer outweigh your sense of practical and normal spending habits
The way we should look at scenarios like this one is to recognize that any form of debt, no matter how big or small, is bad. We should also note that while we had enough money saved to buy an adequate computer, we chose to burden ourselves with the more expensive model.
We can overcome this set-back by being willing to limit our purchases on things we want and focusing on buying only what we need. By limiting our spending to things we need from those we want, we will be able to save more, which means we can eventually get out of debt.
http://www.giftfromraymond.com has been teaching his true wealth secrets for over a quarter-century so you can double your income doing what you love.
Article Source: http://EzineArticles.com/?expert=Raymond_Aaron
Islamic Banking - Key Differences of Components Within a Financial Statements of an Islamic Bank
Let us look at the key differences in presentation of financial statements between conventional an Islamic banking.
Statement of Financial Position (Balance Sheet)
In conventional accounting, the balance sheet has these few components, namely assets, liabilities and owners' equity. In Islamic banking, there is one additional component called "equity of unrestricted investment account holders".
In conventional banking, an asset is defined as an item with future economic benefit attached to it regardless whether there is legal control by the reporting bank. For Islamic banking, however, an item can be taken as an asset only when the Islamic bank has legal right to hold, use or dispose of the item.
The other unique feature is the "equity of unrestricted investment account holders". This additional component is to satisfy the set of customers who invest on the basis of mudarabah which calls for any losses to be borne by the investors (the customers themselves). It is therefore, important to disclose sufficient information to demonstrate the measures taken by the bank to ensure that the interests of this set of customers are considered as part of the strategy of the bank. In conventional banking, they will be treated as liabilities instead.
There are 2 forms of mudarabah contracts:-
1. Mudarabah Mutlaqah - This is the "unrestricted" mudarabah contract whereby the capital provider/owner allows total freedom to the bank to use the capital for its projects without conditions, specifications, restrictions or limits. The bank is free to enter into any trade agreements, whether normal or deferred or leasing basis, using the owners' capital. This form of mudarabah is typically used in replacement of the conventional fixed deposit product for retail customers.
2. Mudarabah Muqqayadah - This is the "restricted" mudarabah contract. The bank is given certain parameters (restrictions and conditions) on how to use the capital provided by the owners.
Statement of Changes in Restricted Investments and Their Equivalent
This is the statement to report the use of mudarabah muqqayadah investments whereby the bank is to undertake to use the funds for specific investments. This pool of fund must be separated from other funds as the returns from this fund will be shared among this particular group of investors.
Apart from the returns or losses for the group of restricted investors, the statement should also report profits or losses before deducting the investment manager's share of investment profits/losses. The bank's share of compensation as the investment agent is also known as mudarib.
Statement of Sources and Uses of Zakat and Charity Fund
This is required only when the bank established a zakat and charity fund whereby the bank acts as a fiduciary of that fund. The bank is responsible for collection and distribution of all or part of zakat and charity funds.
KL Management Services is a business process outsourcing company, offering company secretarial services, human resource, debt recovery & credit control, accounting and taxation and corporate advisory services to corporates and companies in Malaysia and Asia Pacific.
The people behind KLM are elites in their own industries, having years of experience and key figures in many public listed companies in Malaysia. KL Management Services is a professional accounting firm in Malaysia. Visit them at http://www.klmanagement.com.my/
Collaborating and in association with KL Management Services is Idelinq Services, a full-fledged marketing company offering off, on and above the line marketing services and IT infrastructure services in Malaysia. Get their latest update at http://www.elioe.com/
Article Source: http://EzineArticles.com/?expert=Ken_Low
Statement of Financial Position (Balance Sheet)
In conventional accounting, the balance sheet has these few components, namely assets, liabilities and owners' equity. In Islamic banking, there is one additional component called "equity of unrestricted investment account holders".
In conventional banking, an asset is defined as an item with future economic benefit attached to it regardless whether there is legal control by the reporting bank. For Islamic banking, however, an item can be taken as an asset only when the Islamic bank has legal right to hold, use or dispose of the item.
The other unique feature is the "equity of unrestricted investment account holders". This additional component is to satisfy the set of customers who invest on the basis of mudarabah which calls for any losses to be borne by the investors (the customers themselves). It is therefore, important to disclose sufficient information to demonstrate the measures taken by the bank to ensure that the interests of this set of customers are considered as part of the strategy of the bank. In conventional banking, they will be treated as liabilities instead.
There are 2 forms of mudarabah contracts:-
1. Mudarabah Mutlaqah - This is the "unrestricted" mudarabah contract whereby the capital provider/owner allows total freedom to the bank to use the capital for its projects without conditions, specifications, restrictions or limits. The bank is free to enter into any trade agreements, whether normal or deferred or leasing basis, using the owners' capital. This form of mudarabah is typically used in replacement of the conventional fixed deposit product for retail customers.
2. Mudarabah Muqqayadah - This is the "restricted" mudarabah contract. The bank is given certain parameters (restrictions and conditions) on how to use the capital provided by the owners.
Statement of Changes in Restricted Investments and Their Equivalent
This is the statement to report the use of mudarabah muqqayadah investments whereby the bank is to undertake to use the funds for specific investments. This pool of fund must be separated from other funds as the returns from this fund will be shared among this particular group of investors.
Apart from the returns or losses for the group of restricted investors, the statement should also report profits or losses before deducting the investment manager's share of investment profits/losses. The bank's share of compensation as the investment agent is also known as mudarib.
Statement of Sources and Uses of Zakat and Charity Fund
This is required only when the bank established a zakat and charity fund whereby the bank acts as a fiduciary of that fund. The bank is responsible for collection and distribution of all or part of zakat and charity funds.
KL Management Services is a business process outsourcing company, offering company secretarial services, human resource, debt recovery & credit control, accounting and taxation and corporate advisory services to corporates and companies in Malaysia and Asia Pacific.
The people behind KLM are elites in their own industries, having years of experience and key figures in many public listed companies in Malaysia. KL Management Services is a professional accounting firm in Malaysia. Visit them at http://www.klmanagement.com.my/
Collaborating and in association with KL Management Services is Idelinq Services, a full-fledged marketing company offering off, on and above the line marketing services and IT infrastructure services in Malaysia. Get their latest update at http://www.elioe.com/
Article Source: http://EzineArticles.com/?expert=Ken_Low
วันศุกร์ที่ 22 พฤษภาคม พ.ศ. 2552
Using Debt Settlement to Avoid Bankruptcy
This year more and more individuals are finding themselves unable to pay their monthly bills.
Unsecured debt, which is usually credit card debt, can be managed in several ways. Most people would like to avoid filing bankruptcy if at all possible. One way to get back on the road to financial success is by seeking the services of a debt settlement or debt consolidation company.
These companies provide strategies to negotiate terms for the repayment of creditors with a reduced lump sum amount.
The settlement company and each creditor meet and agree upon an amount that is acceptable for both parties. At this point, a monthly payment amount is arranged between the client and the settlement company.
A certain percentage of each monthly payment is given to the settlement company for their services provided. The remainder of the payment is put into an account for the client. When this account reaches a predetermined amount one creditor will be paid in full. The monthly payments continue until all the creditors have been paid their agreed upon amount for settlement of the accounts. Bankruptcy should be a last means of settling your financial matters and hopefully one that you will be able to avoid.
If you have unsecured debt such as credit card debt and you want to avoid filing bankruptcy, debt settlement is one option to think about using. There are many reputable debt settlement & negotiation companies that can assist you in going this route.
This is for only unsecured debt. You cannot settle mortgage or car loans or any type of secured debt through this type of settlement. These settlement companies typically take all of your information and contact all of your unsecured creditors for you and negotiate a lower payoff amount on your debt. This can be anywhere from twenty to ninety percent off of the original balance.
It just depends on the circumstances and the amount of your debt. Debt settlement & negotiation companies are trained to try and get the best and lowest amounts for you. They typically will also try to get you a six month payment plan in order to give you time to be allowed to come up with the needed funds to get the negotiated amount paid off. However, if you fail to make the payments or if you fail to pay off the amount that has been agreed upon, you will end up owing the amount in full once again.
You must make sure you will be able to meet this amount due. You must also understand that the amount of the debt that the credit company writes off will be taxed at the end of the year and you must claim this on your tax return.
Gemma-Leigh Garner is a freelance copywriter and blogger that writes on many different financial subjects such as debt advice and how to avoid bankruptcy and other current events.
Article Source: http://EzineArticles.com/?expert=Gemma-Leigh_Garner
Unsecured debt, which is usually credit card debt, can be managed in several ways. Most people would like to avoid filing bankruptcy if at all possible. One way to get back on the road to financial success is by seeking the services of a debt settlement or debt consolidation company.
These companies provide strategies to negotiate terms for the repayment of creditors with a reduced lump sum amount.
The settlement company and each creditor meet and agree upon an amount that is acceptable for both parties. At this point, a monthly payment amount is arranged between the client and the settlement company.
A certain percentage of each monthly payment is given to the settlement company for their services provided. The remainder of the payment is put into an account for the client. When this account reaches a predetermined amount one creditor will be paid in full. The monthly payments continue until all the creditors have been paid their agreed upon amount for settlement of the accounts. Bankruptcy should be a last means of settling your financial matters and hopefully one that you will be able to avoid.
If you have unsecured debt such as credit card debt and you want to avoid filing bankruptcy, debt settlement is one option to think about using. There are many reputable debt settlement & negotiation companies that can assist you in going this route.
This is for only unsecured debt. You cannot settle mortgage or car loans or any type of secured debt through this type of settlement. These settlement companies typically take all of your information and contact all of your unsecured creditors for you and negotiate a lower payoff amount on your debt. This can be anywhere from twenty to ninety percent off of the original balance.
It just depends on the circumstances and the amount of your debt. Debt settlement & negotiation companies are trained to try and get the best and lowest amounts for you. They typically will also try to get you a six month payment plan in order to give you time to be allowed to come up with the needed funds to get the negotiated amount paid off. However, if you fail to make the payments or if you fail to pay off the amount that has been agreed upon, you will end up owing the amount in full once again.
You must make sure you will be able to meet this amount due. You must also understand that the amount of the debt that the credit company writes off will be taxed at the end of the year and you must claim this on your tax return.
Gemma-Leigh Garner is a freelance copywriter and blogger that writes on many different financial subjects such as debt advice and how to avoid bankruptcy and other current events.
Article Source: http://EzineArticles.com/?expert=Gemma-Leigh_Garner
วันพฤหัสบดีที่ 21 พฤษภาคม พ.ศ. 2552
Identity Theft - Easy Tips to Stay Safe
Identity theft keeps on growing at a worrying rate and stories abound of people who have had their identities stolen only to find themselves later getting refused for credit cards, mortgages and the like. The reason, of course, is that someone else has already applied for such things in their name and then not paid them back. You end up credit blacklisted - sometimes literally leading to massive financial problems as you try to explain away the unpaid loans - while the criminal often gets off without trouble because they are so hard to trace.
So what common-sense things can we be doing to avoid this unfortunate situation?
The first and most important element that I personally have implemented is the use of a paper shredder. Use a good quality shredder to destroy any paperwork with sensitive information about you before disposing of it. Good examples of what you should shred include bank statements, receipts, any letters related to your finances (loan offers, credit card statements etc.) and personally I even go to the extra point of shredding anything with my full name and address on.
This means that most envelopes I receive are shredded too, though I believe this small amoount of additional time spent on protecting myself is well worthwhile.
Next, try not to give out your details wherever possible. For example, try to stay off mailing lists that may sell your information to other companies. After all, the fewer copies of your full name and address there are around, the less chance there is of someone getting hold of your details for malicious uses.
A common problem that has been outlined in the press is companies ringing you up at home or on your cell phone and claiming they are from a legitimate organization and just need a few details. In the UK at present, this often reveals itself as a cell phone upgrade. A call on your phone tells you that you are entitled to another new phone, they just need to take a few details from you. Typically these people never see a new phone, but many see charges they never expected on their bank statement or credit record. So take care with these details.
Speaking of credit reports, as credit report are so easy and cheap to come by these days, consider getting a copy of your own records just to check them for an inaccuracies. Take note of anything suspicious so you can follow them up. Awareness of the problem - and how to control it - is vital.
Take care when using your details online and ensure that you only enter them into a secure form as evidenced by your internet browser, and regularly check your computer for viruses and spyware that may be keeping a log of all your details as you type them in, posing a risk for the future.
Lastly, be aware that there are now a number of banks and credit card companies that offer identity theft protection. These institutions not only help to offer you more protection but will also assist you in resolving issues with identity theft if and when they occur.
A great first step to protecting your identity is to buy a paper shredder
Article Source: http://EzineArticles.com/?expert=Richard_Adams
So what common-sense things can we be doing to avoid this unfortunate situation?
The first and most important element that I personally have implemented is the use of a paper shredder. Use a good quality shredder to destroy any paperwork with sensitive information about you before disposing of it. Good examples of what you should shred include bank statements, receipts, any letters related to your finances (loan offers, credit card statements etc.) and personally I even go to the extra point of shredding anything with my full name and address on.
This means that most envelopes I receive are shredded too, though I believe this small amoount of additional time spent on protecting myself is well worthwhile.
Next, try not to give out your details wherever possible. For example, try to stay off mailing lists that may sell your information to other companies. After all, the fewer copies of your full name and address there are around, the less chance there is of someone getting hold of your details for malicious uses.
A common problem that has been outlined in the press is companies ringing you up at home or on your cell phone and claiming they are from a legitimate organization and just need a few details. In the UK at present, this often reveals itself as a cell phone upgrade. A call on your phone tells you that you are entitled to another new phone, they just need to take a few details from you. Typically these people never see a new phone, but many see charges they never expected on their bank statement or credit record. So take care with these details.
Speaking of credit reports, as credit report are so easy and cheap to come by these days, consider getting a copy of your own records just to check them for an inaccuracies. Take note of anything suspicious so you can follow them up. Awareness of the problem - and how to control it - is vital.
Take care when using your details online and ensure that you only enter them into a secure form as evidenced by your internet browser, and regularly check your computer for viruses and spyware that may be keeping a log of all your details as you type them in, posing a risk for the future.
Lastly, be aware that there are now a number of banks and credit card companies that offer identity theft protection. These institutions not only help to offer you more protection but will also assist you in resolving issues with identity theft if and when they occur.
A great first step to protecting your identity is to buy a paper shredder
Article Source: http://EzineArticles.com/?expert=Richard_Adams
วันพุธที่ 20 พฤษภาคม พ.ศ. 2552
How to Teach Financial Matters to Our Children
Countless parents pay a lot of money to assist their children acquire the best professional training but forget to forfeit the little essential to help them acquire the skills of managing their education paybacks- salaries.
Financial decisions are almost attached to every aspect of our lives and this is what makes financial literacy very important to both parents and their children as they grow up.
Why teach your kids about money
There are several benefits a child can gather from being wise on money matters, some of which my include the following.
Children can administer their own incomes that parents provide now by spending on necessities while avoiding extravagance.
A child will value savings and investment decisions. Money matters education along with parent's intervention on the child's financial use enables him or her to think and take action about tomorrow.
A child becomes independent when still young. How many parents have brought up grown-ups who remain parasites even when it is obvious that they should be out of the nest and facing the world on their own?
Children who grow up understanding that earning money requires handwork, determination and smart spending and saving decisions, can be said to be self-sufficient.
Becoming an entrepreneur is thought out to be inborn for some people while others are made.
Your child could later become his or her own boss in a business and if they will be financial literate then, it will make them strategic business and money planners.
Simple ways a parent can use to train kids personal finance
Soon after he/she learns counting, introduce them to money. To do this, parents need to be patient with the kids as they take these lessons. Normally they understand fast by observing a repeated money lesson.
Open up your own money values, saving it, growing it, and most notably spending it and this means as a parent you need to consider how well you master your own finances.
Assist them in making distinctions between needs, wants and luxuries. Not understanding these ends up in overspending and really bad debts even to the adults.
Emphasize on setting spending goals every time kids request for money, or items, to discourage impulse buying; in other words, let them learn the process of budgeting.
Initiate the principle of savings against spending and demonstrate how swift money grows.
This will begin if you showed them how to list their needs in order of priorities and emphasize on spending based on urgency not luxury, when cash is limited. Involving them in shopping will sharpen spending skills more.
Allow them to participate in opening their own bank saving plan by letting them accompany you there.
Some parents open many of such plans on behalf of their kids and say nothing until a time to join college comes.
One way of raising a completely responsible child is by leaving them to be vulnerable on financial issues, and without you around, they will find a solution to the problem.
Let them participate to such easy tasks as opening bank accounts, applying for credit cards, collage loans, and the like, only come in if they need any clarifications.
Keep your distance and allow your children make their financial decisions on their own, whether good or poor.
The bad ones motivate them to be careful with money tomorrow while good ones mean they are progressively getting on track on their own.
One way you can enhance this process is by all means training them how to keep track of the money they have spent, invested or saved by maintaining good records.
Paying a personal finance management course for your collage going child or talk them into paying if they are already done and independent is the best decision a parent may never regret why they made it.
An original article by Esteri Maina on FINANCIAL
Article Source: http://EzineArticles.com/?expert=Esteri_Maina
Financial decisions are almost attached to every aspect of our lives and this is what makes financial literacy very important to both parents and their children as they grow up.
Why teach your kids about money
There are several benefits a child can gather from being wise on money matters, some of which my include the following.
Children can administer their own incomes that parents provide now by spending on necessities while avoiding extravagance.
A child will value savings and investment decisions. Money matters education along with parent's intervention on the child's financial use enables him or her to think and take action about tomorrow.
A child becomes independent when still young. How many parents have brought up grown-ups who remain parasites even when it is obvious that they should be out of the nest and facing the world on their own?
Children who grow up understanding that earning money requires handwork, determination and smart spending and saving decisions, can be said to be self-sufficient.
Becoming an entrepreneur is thought out to be inborn for some people while others are made.
Your child could later become his or her own boss in a business and if they will be financial literate then, it will make them strategic business and money planners.
Simple ways a parent can use to train kids personal finance
Soon after he/she learns counting, introduce them to money. To do this, parents need to be patient with the kids as they take these lessons. Normally they understand fast by observing a repeated money lesson.
Open up your own money values, saving it, growing it, and most notably spending it and this means as a parent you need to consider how well you master your own finances.
Assist them in making distinctions between needs, wants and luxuries. Not understanding these ends up in overspending and really bad debts even to the adults.
Emphasize on setting spending goals every time kids request for money, or items, to discourage impulse buying; in other words, let them learn the process of budgeting.
Initiate the principle of savings against spending and demonstrate how swift money grows.
This will begin if you showed them how to list their needs in order of priorities and emphasize on spending based on urgency not luxury, when cash is limited. Involving them in shopping will sharpen spending skills more.
Allow them to participate in opening their own bank saving plan by letting them accompany you there.
Some parents open many of such plans on behalf of their kids and say nothing until a time to join college comes.
One way of raising a completely responsible child is by leaving them to be vulnerable on financial issues, and without you around, they will find a solution to the problem.
Let them participate to such easy tasks as opening bank accounts, applying for credit cards, collage loans, and the like, only come in if they need any clarifications.
Keep your distance and allow your children make their financial decisions on their own, whether good or poor.
The bad ones motivate them to be careful with money tomorrow while good ones mean they are progressively getting on track on their own.
One way you can enhance this process is by all means training them how to keep track of the money they have spent, invested or saved by maintaining good records.
Paying a personal finance management course for your collage going child or talk them into paying if they are already done and independent is the best decision a parent may never regret why they made it.
An original article by Esteri Maina on FINANCIAL
Article Source: http://EzineArticles.com/?expert=Esteri_Maina
วันอังคารที่ 19 พฤษภาคม พ.ศ. 2552
How To Make Bank Deposits A Safe Cover
When rumours about the financial health of a private bank began to circulate, people queued up at the bank's ATMs in the wee hours to withdraw money. One of my friends who had large sums parked in fixed deposits with the bank called to enquire about the rumour.
When I asked him whether he had similar deposits across a range of banks, he replied that his entire surplus cash of Rs 8 lakh was parked with the same bank, as he did not have an account with any other bank! Shocked, I took the opportunity to explain to him how deposit insurance works in India. Here is what my friend, and others like him, needs to know.
How much is covered?
All deposits of up to Rs 1 lakh in a commercial or cooperative bank in India are insured by the Deposit Insurance and Credit Guarantee Corporation of India (DICGC) (a wholly owned subsidiary of RBI).The insurance coverage to the banks is extended by collecting premium from the banks, at half-yearly intervals at the rate of 10 paise per annum per hundred rupees. The insurance protection is made available to the depositors free of cost. The cover of Rs 1 lakh is applicable for your principal and interest dues taken together. Deposits in different banks are separately insured, with each deposit eligible for Rs 1 lakh cover.
What kinds of deposits are covered?
Insurance cover is available across savings accounts, current accounts, recurring and fixed deposits. All commercial banks including branches of foreign banks functioning in India, local area banks and regional rural banks are covered. At present, all co-operative banks other than those from the States of Meghalaya and the Union Territories of Chandigarh, Lakshadweep and Nagar Haveli are covered under the deposit insurance system. Primary cooperative societies are not currently covered by the scheme.
What are the ways to increase the cover for my bank deposits?
Spreading your surplus across many banks is the most direct way to increase the deposit cover. You can even make sure that your deposits in a single bank are insured, by having multiple joint accounts with different "first holders". Insurance tends to be offered in the first holder's name.
What happens to deposits in a joint account?
If more than one deposit account (whether savings, current, recurring or fixed deposit) is jointly held by individuals in one or more branches of a bank, then all the accounts in which their names appear in the same order will be aggregated for the Rs 1 lakh cover. However, if deposits are held under different first holders, then every such account will be eligible for insurance cover of Rs 1 lakh.
Is it possible to increase the insurance cover for my deposit by paying a higher premium?
No. It is not possible to pay premium and increase the cover. However, such provisions may come into being in future. Recently, with the financial turmoil in the US, as part of the bailout package, the US Government has increased the cover from $1,00,000 to $2,50,000. So it's possible in India that the cover may be enhanced in future.
How are the settlement claims awarded?
In the event of the winding up or liquidation of bank, every depositor of the bank is entitled to payment of an amount equal to the deposits held by him at all the branches of that bank put together, standing as on the date of cancellation of registration of the bank. So, all my friend has to do to avoid sleepless nights at the ATM is to spread his deposits over several banks, to increase his overall insurance cover!
For information on banking policies, please visit Banksloanonline.com
Sunaina Sharma is Content Coordinator for Banksloanonline.com. This website gives you comprehensive information online bank loans, banking services along with investment policies and banking laws in India, bank loans, bank loans payment and bank policies.
Article Source: http://EzineArticles.com/?expert=Sunaina_Sharma
When I asked him whether he had similar deposits across a range of banks, he replied that his entire surplus cash of Rs 8 lakh was parked with the same bank, as he did not have an account with any other bank! Shocked, I took the opportunity to explain to him how deposit insurance works in India. Here is what my friend, and others like him, needs to know.
How much is covered?
All deposits of up to Rs 1 lakh in a commercial or cooperative bank in India are insured by the Deposit Insurance and Credit Guarantee Corporation of India (DICGC) (a wholly owned subsidiary of RBI).The insurance coverage to the banks is extended by collecting premium from the banks, at half-yearly intervals at the rate of 10 paise per annum per hundred rupees. The insurance protection is made available to the depositors free of cost. The cover of Rs 1 lakh is applicable for your principal and interest dues taken together. Deposits in different banks are separately insured, with each deposit eligible for Rs 1 lakh cover.
What kinds of deposits are covered?
Insurance cover is available across savings accounts, current accounts, recurring and fixed deposits. All commercial banks including branches of foreign banks functioning in India, local area banks and regional rural banks are covered. At present, all co-operative banks other than those from the States of Meghalaya and the Union Territories of Chandigarh, Lakshadweep and Nagar Haveli are covered under the deposit insurance system. Primary cooperative societies are not currently covered by the scheme.
What are the ways to increase the cover for my bank deposits?
Spreading your surplus across many banks is the most direct way to increase the deposit cover. You can even make sure that your deposits in a single bank are insured, by having multiple joint accounts with different "first holders". Insurance tends to be offered in the first holder's name.
What happens to deposits in a joint account?
If more than one deposit account (whether savings, current, recurring or fixed deposit) is jointly held by individuals in one or more branches of a bank, then all the accounts in which their names appear in the same order will be aggregated for the Rs 1 lakh cover. However, if deposits are held under different first holders, then every such account will be eligible for insurance cover of Rs 1 lakh.
Is it possible to increase the insurance cover for my deposit by paying a higher premium?
No. It is not possible to pay premium and increase the cover. However, such provisions may come into being in future. Recently, with the financial turmoil in the US, as part of the bailout package, the US Government has increased the cover from $1,00,000 to $2,50,000. So it's possible in India that the cover may be enhanced in future.
How are the settlement claims awarded?
In the event of the winding up or liquidation of bank, every depositor of the bank is entitled to payment of an amount equal to the deposits held by him at all the branches of that bank put together, standing as on the date of cancellation of registration of the bank. So, all my friend has to do to avoid sleepless nights at the ATM is to spread his deposits over several banks, to increase his overall insurance cover!
For information on banking policies, please visit Banksloanonline.com
Sunaina Sharma is Content Coordinator for Banksloanonline.com. This website gives you comprehensive information online bank loans, banking services along with investment policies and banking laws in India, bank loans, bank loans payment and bank policies.
Article Source: http://EzineArticles.com/?expert=Sunaina_Sharma
วันจันทร์ที่ 18 พฤษภาคม พ.ศ. 2552
Get Approved For Government Grants For Small Business - Pay For Start Up Costs
Government grants for small business can help you start or expand your endeavor and help you pursue your dream. Applying for these grants can be a long process, but they can also provide you with $50,000 or more to spend on your business.
However, the government grants for small business are not the only sources for free money and cheap loans. There are various organizations and private foundations that also provide funding for soon to be business owners in order to help them succeed.
This includes grant programs for your specific business that you have in mind, as well as small business grants and loans for women and minority entrepreneurs. The best thing to do is search through a grant database, find the most suitable grant programs that pertain to you and your business, and read the eligibility requirements carefully.
Before you apply, make sure you get all of your paperwork together to provide the best possible presentation of your business grant request. The reviewer will need some confidence that you are well organized and likely to succeed with their help.
The approval process will vary from grant to grant, but government grants for small business tend to be the most rigorous. These sources may be able to provide the most money though, so it is not worth overlooking. Once obtained, you won't have to pay taxes on these funds and you will not have to repay the money, so long you use the funds in the appropriate manner and according to the grant terms.
Access to the database and find grants for small business.
Get Free Grant Money.
Article Source: http://EzineArticles.com/?expert=Austin_Warty
Austin Warty - EzineArticles Expert Author
However, the government grants for small business are not the only sources for free money and cheap loans. There are various organizations and private foundations that also provide funding for soon to be business owners in order to help them succeed.
This includes grant programs for your specific business that you have in mind, as well as small business grants and loans for women and minority entrepreneurs. The best thing to do is search through a grant database, find the most suitable grant programs that pertain to you and your business, and read the eligibility requirements carefully.
Before you apply, make sure you get all of your paperwork together to provide the best possible presentation of your business grant request. The reviewer will need some confidence that you are well organized and likely to succeed with their help.
The approval process will vary from grant to grant, but government grants for small business tend to be the most rigorous. These sources may be able to provide the most money though, so it is not worth overlooking. Once obtained, you won't have to pay taxes on these funds and you will not have to repay the money, so long you use the funds in the appropriate manner and according to the grant terms.
Access to the database and find grants for small business.
Get Free Grant Money.
Article Source: http://EzineArticles.com/?expert=Austin_Warty
Austin Warty - EzineArticles Expert Author
วันอาทิตย์ที่ 17 พฤษภาคม พ.ศ. 2552
Getting Paid to Take Risk
As a professional options trader, there are two things I will remember most as I look back at this bear market of 2008, and that is; a.) How covered call writing investors are receiving substantial option premiums to take risk and; b.) How the certainty of a "buy and hold" approach of a well diversified, structured portfolio was not spared from the devastating effects of this bear market liquidation.
REIT's, commodities, large cap, international, emerging markets, convertible bonds, defensive stocks, took severe beatings in 2008. Every company that was considered "too big to fail", or so conservative that it shouldn't have failed, did just that. Whoever said "No two bear markets are alike" certainly got that right. Even Warren Buffet's Berkshire Hathaway stock (Symbol: BRK) experienced a -54% peak-to-trough trading range in since December 2007. There has never more uncertainty among Investors approaching retirement, CFA's and mathematically minded financial services participants, as the market's nervous reaction to every "take it to the bank" arbitrage in 2008 became temporarily disconnected.
Author Roger Lowenstein has spent considerable time analyzing those who come to trading by way of the traditional route. In his book, When Genius Failed: The Rise and Fall of Long Term Capital Management1, Lowenstein wrote that "those who are attracted to mathematics and analysis are drawn to fixed income and convertible bond arbitrage because much of what determines their value is readily quantifiable."
I suspect financial planners and sophisticated investors in general, are a similar breed. The financial planners I know are well educated, mathematically minded, and contemplative. They're attracted to the certainty of planning, and their vocabularies are peppered with terms like annuity, CAGR, estate planning, efficient frontier, MPT, asset allocation, risk-adjusted return, and diversified portfolio.
On the other hand, those attracted to floor trading, like me are typically emotional, anxious, and highly intuitive. Like hungry street urchins, we rely on quick reflexes and the general belief that it's more important to be first on a trade than it is to be right. And like any self-respecting trader, we thirst for a little excitement. In fact, we can be described as the liar's-poker-double-espresso-filled-undiagnosed-ADD-patients-who-trade-triple-beta-ETFs-because-anything-less-than-a-Volatility-Index-level-of-70-is-too-boring orphans of the industry.
Terms that an options floor trader may use on any given day are a bit different than those of a typical financial planner and include skew, kurtosis, theoretical edge, risk reversal, I-Wham (Russell 2000 ETF; Symbol: IWM), implied volatility, assignment, dollar-weighted deltas, and slop.
When I started on the trading floor of the CBOE in 1982, I was 22, and the majority of the traders in those days were from blue collar, Irish families who treated day-trading with the same mentality as a plumber who lays pipe or a carpenter who frames a wall: it was a job.
I spent the majority of my years at the CBOE in the OEX pit, where the practice of hiring MBAs was discouraged - even derided. Why? It was believed that you couldn't teach a business major anything. And that might have been true: they weren't pliable enough to mentor. Floor traders needed to have an intuitive sense of risk management and quick reflexes to maneuver around short term market moves. With an eye toward disaster, they frequently owned out-of-the-money puts. Countless arguments erupted between the quants, who understood the mathematical impossibility of a 23 standard deviation move during the Crash of 1987 and the floor traders who had no idea what a standard deviation was, but who did know that they would lose their homes if the market dropped substantially.
And they figured - without the aid of a calculator - that their wives would be really, really mad.
Lowenstein cites how Nobel Prize winners Fisher Black, Myron Scholes, and Robert Merton, who created the famous option pricing model known as Black-Scholes, disagreed with the fat tails or steepness of volatility skew that floor traders priced into out-of-the-money put options. To the creators of the Black-Scholes option pricing model, volatility was a constant, log-normal distribution.
"Merton carried the assumption a step further," Lowenstein says. "He assumed volatility was so constant that prices would trade in continuous time, without any jumps."
Today's options traders need a firm grasp on the nuances of volatility skew, kurtosis, dollar-weighted deltas, and Vega. Yes, we have high speed computers that process tens of thousands of theoretical values in hundredths of milliseconds and seven billion stock and option quotes per day sent from exchanges.
But can the emotional and often volatile pit trader offer anything to the structured, well educated financial planner? The answer is yes. The truth is that you don't need anything other than a simple calculator, the right kind of experience, and often, a little out-of-the-box thinking to achieve a terrific rate of return. After all, it is said that some of the best inspirations come from outside the box.
And who is more outside the box than an options trader?
I was struck by a comment made by CFA Adrian Cronje, who was quoted in the Journal of Financial Planning, January, 2009 issue, as saying, "The good news is that for the first time in many years, investors are now being paid to take risks."2
Investors are being paid to take risks. Imagine that.
Nowhere is that statement truer than in the current environment of options trading and covered call writing. To be more accurate, investors are getting paid handsomely to take less risk. Recent market volatility has created a once-in-a-generation perfect storm, a history making blizzard favoring the individual investor and featuring:
1. Unprecedentedly high option volatility levels due to the credit crisis
2. The inability of investment banks to participate in trading due to their de-leveraging
3. Clearing firms uniformly reducing risk across all market participants
4. Continued fear of the downside
5. Massive de-leveraging of hedge funds and 130/30 strategies
6. Generational low interest rates
7. Pensions and endowments rumored to be selling assets to meet cash obligations rather than rebalancing strategic allocations
Financial Planners and investors may want to brush up on basic option theory especially covered call writing tactics and read the academic white papers on the higher risk adjusted returns covered call writing provides as the nations 76 million baby boomers will be looking to planners and advisors for help in rebuilding their portfolios and simultaneously converting their "buy and hold" portfolios of growth stocks to a vehicle that delivers substantial retirement income.
Retirees are tired of hearing the endless droning from pundits discussing the benefits of greater asset allocation, cutting monthly expenses or promoting the benefits of being a Wal-Mart greeter.
Endnotes:
Lowenstein, Roger, When Genius Failed: The Rise and Fall of Long Term Capital Management (New York: Random House, 2001), 67-68, 76-77.
Cronje, Adrian, Journal of Financial Planning, "Is Markowitz Wrong?" ;(Jan 2009)
William Ulivieri is the founder of Old School Options LLC;
http://www.oldschooloptions.com an internet based options education service which combines technical analysis and passive call writing option strategies suitable for retirement accounts. He can be reached at: bill@oldschooloptions.com
Article Source: http://EzineArticles.com/?expert=William_Ulivieri
REIT's, commodities, large cap, international, emerging markets, convertible bonds, defensive stocks, took severe beatings in 2008. Every company that was considered "too big to fail", or so conservative that it shouldn't have failed, did just that. Whoever said "No two bear markets are alike" certainly got that right. Even Warren Buffet's Berkshire Hathaway stock (Symbol: BRK) experienced a -54% peak-to-trough trading range in since December 2007. There has never more uncertainty among Investors approaching retirement, CFA's and mathematically minded financial services participants, as the market's nervous reaction to every "take it to the bank" arbitrage in 2008 became temporarily disconnected.
Author Roger Lowenstein has spent considerable time analyzing those who come to trading by way of the traditional route. In his book, When Genius Failed: The Rise and Fall of Long Term Capital Management1, Lowenstein wrote that "those who are attracted to mathematics and analysis are drawn to fixed income and convertible bond arbitrage because much of what determines their value is readily quantifiable."
I suspect financial planners and sophisticated investors in general, are a similar breed. The financial planners I know are well educated, mathematically minded, and contemplative. They're attracted to the certainty of planning, and their vocabularies are peppered with terms like annuity, CAGR, estate planning, efficient frontier, MPT, asset allocation, risk-adjusted return, and diversified portfolio.
On the other hand, those attracted to floor trading, like me are typically emotional, anxious, and highly intuitive. Like hungry street urchins, we rely on quick reflexes and the general belief that it's more important to be first on a trade than it is to be right. And like any self-respecting trader, we thirst for a little excitement. In fact, we can be described as the liar's-poker-double-espresso-filled-undiagnosed-ADD-patients-who-trade-triple-beta-ETFs-because-anything-less-than-a-Volatility-Index-level-of-70-is-too-boring orphans of the industry.
Terms that an options floor trader may use on any given day are a bit different than those of a typical financial planner and include skew, kurtosis, theoretical edge, risk reversal, I-Wham (Russell 2000 ETF; Symbol: IWM), implied volatility, assignment, dollar-weighted deltas, and slop.
When I started on the trading floor of the CBOE in 1982, I was 22, and the majority of the traders in those days were from blue collar, Irish families who treated day-trading with the same mentality as a plumber who lays pipe or a carpenter who frames a wall: it was a job.
I spent the majority of my years at the CBOE in the OEX pit, where the practice of hiring MBAs was discouraged - even derided. Why? It was believed that you couldn't teach a business major anything. And that might have been true: they weren't pliable enough to mentor. Floor traders needed to have an intuitive sense of risk management and quick reflexes to maneuver around short term market moves. With an eye toward disaster, they frequently owned out-of-the-money puts. Countless arguments erupted between the quants, who understood the mathematical impossibility of a 23 standard deviation move during the Crash of 1987 and the floor traders who had no idea what a standard deviation was, but who did know that they would lose their homes if the market dropped substantially.
And they figured - without the aid of a calculator - that their wives would be really, really mad.
Lowenstein cites how Nobel Prize winners Fisher Black, Myron Scholes, and Robert Merton, who created the famous option pricing model known as Black-Scholes, disagreed with the fat tails or steepness of volatility skew that floor traders priced into out-of-the-money put options. To the creators of the Black-Scholes option pricing model, volatility was a constant, log-normal distribution.
"Merton carried the assumption a step further," Lowenstein says. "He assumed volatility was so constant that prices would trade in continuous time, without any jumps."
Today's options traders need a firm grasp on the nuances of volatility skew, kurtosis, dollar-weighted deltas, and Vega. Yes, we have high speed computers that process tens of thousands of theoretical values in hundredths of milliseconds and seven billion stock and option quotes per day sent from exchanges.
But can the emotional and often volatile pit trader offer anything to the structured, well educated financial planner? The answer is yes. The truth is that you don't need anything other than a simple calculator, the right kind of experience, and often, a little out-of-the-box thinking to achieve a terrific rate of return. After all, it is said that some of the best inspirations come from outside the box.
And who is more outside the box than an options trader?
I was struck by a comment made by CFA Adrian Cronje, who was quoted in the Journal of Financial Planning, January, 2009 issue, as saying, "The good news is that for the first time in many years, investors are now being paid to take risks."2
Investors are being paid to take risks. Imagine that.
Nowhere is that statement truer than in the current environment of options trading and covered call writing. To be more accurate, investors are getting paid handsomely to take less risk. Recent market volatility has created a once-in-a-generation perfect storm, a history making blizzard favoring the individual investor and featuring:
1. Unprecedentedly high option volatility levels due to the credit crisis
2. The inability of investment banks to participate in trading due to their de-leveraging
3. Clearing firms uniformly reducing risk across all market participants
4. Continued fear of the downside
5. Massive de-leveraging of hedge funds and 130/30 strategies
6. Generational low interest rates
7. Pensions and endowments rumored to be selling assets to meet cash obligations rather than rebalancing strategic allocations
Financial Planners and investors may want to brush up on basic option theory especially covered call writing tactics and read the academic white papers on the higher risk adjusted returns covered call writing provides as the nations 76 million baby boomers will be looking to planners and advisors for help in rebuilding their portfolios and simultaneously converting their "buy and hold" portfolios of growth stocks to a vehicle that delivers substantial retirement income.
Retirees are tired of hearing the endless droning from pundits discussing the benefits of greater asset allocation, cutting monthly expenses or promoting the benefits of being a Wal-Mart greeter.
Endnotes:
Lowenstein, Roger, When Genius Failed: The Rise and Fall of Long Term Capital Management (New York: Random House, 2001), 67-68, 76-77.
Cronje, Adrian, Journal of Financial Planning, "Is Markowitz Wrong?" ;(Jan 2009)
William Ulivieri is the founder of Old School Options LLC;
http://www.oldschooloptions.com an internet based options education service which combines technical analysis and passive call writing option strategies suitable for retirement accounts. He can be reached at: bill@oldschooloptions.com
Article Source: http://EzineArticles.com/?expert=William_Ulivieri
Change the Way You Think and Live a High Income Life
Most people laugh at the idea that living a high income life is possible for them, seemingly at the flip of an internal switch. It is hard to think that they could be living the life they dreamed of by following a simple plan and changing the way they think.
Most of us are at places in our lives where a few small changes in us would drastically alter our lifestyle. Unfortunately, we somehow think that we are too old to change the way we look at problems. We even fear changing so much that it paralyzes us in other areas of our lives.
Even the thought of changing how we view things sends us into a panic, but it is most necessary to make corrections in our selves after self-reflection. Self-reflection is a difficult task to master. It is also a very necessary tool in accomplishing one's goals.
First, change how you see or think about goals and goal setting by understanding that the purpose of setting goals is to accomplish them. Instead of becoming a goal setter, become a goal accomplisher. This will be the beginning of changing how you see things.
Most people think it is impossible to will your way to financial success. Imagine the world without personal computers. If Bill Gates had simply given up on his dreams and goals, where would we be? Gates willed his way to the top of the computer industry for many years. Was he smarter than us? Perhaps, but he believed his goals to be real and attainable, and they were.
By now, every American is fully aware that we are in a global economic crisis. Families are forced to make decisions that sometimes alter their quality of life. Getting out of debt, or making financial decisions based on managing their debt is the best way for families to make it.
Managing debt can be as simple as paying off all small balance credit accounts. Once this task is completed, you can choose to continue paying balances down or save a few dollars and pay off major credit balances. The key in this scenario is not what we are doing, but the fact that we are doing something at all.
Managing debt can also mean not opening new credit accounts when you have what you really need already. Caring for one's family is not at question here, but if there are items that you could live without for now, it would be well worth it to do so. By not adding debt to your current situation, you are actively pursuing being debt free.
Whether you are looking to improve your financial picture or starting from scratch, living a high income lifestyle is attainable with a few actions. We must repeat those actions, or good habits, so often that they become second nature. By changing the way we see debt, or goal accomplishment, we will notice dramatic changes in your lives.
http://www.giftfromraymond.com has been teaching his true wealth secrets for over a quarter-century so you can double your income doing what you love.
Article Source: http://EzineArticles.com/?expert=Raymond_Aaron
Most of us are at places in our lives where a few small changes in us would drastically alter our lifestyle. Unfortunately, we somehow think that we are too old to change the way we look at problems. We even fear changing so much that it paralyzes us in other areas of our lives.
Even the thought of changing how we view things sends us into a panic, but it is most necessary to make corrections in our selves after self-reflection. Self-reflection is a difficult task to master. It is also a very necessary tool in accomplishing one's goals.
First, change how you see or think about goals and goal setting by understanding that the purpose of setting goals is to accomplish them. Instead of becoming a goal setter, become a goal accomplisher. This will be the beginning of changing how you see things.
Most people think it is impossible to will your way to financial success. Imagine the world without personal computers. If Bill Gates had simply given up on his dreams and goals, where would we be? Gates willed his way to the top of the computer industry for many years. Was he smarter than us? Perhaps, but he believed his goals to be real and attainable, and they were.
By now, every American is fully aware that we are in a global economic crisis. Families are forced to make decisions that sometimes alter their quality of life. Getting out of debt, or making financial decisions based on managing their debt is the best way for families to make it.
Managing debt can be as simple as paying off all small balance credit accounts. Once this task is completed, you can choose to continue paying balances down or save a few dollars and pay off major credit balances. The key in this scenario is not what we are doing, but the fact that we are doing something at all.
Managing debt can also mean not opening new credit accounts when you have what you really need already. Caring for one's family is not at question here, but if there are items that you could live without for now, it would be well worth it to do so. By not adding debt to your current situation, you are actively pursuing being debt free.
Whether you are looking to improve your financial picture or starting from scratch, living a high income lifestyle is attainable with a few actions. We must repeat those actions, or good habits, so often that they become second nature. By changing the way we see debt, or goal accomplishment, we will notice dramatic changes in your lives.
http://www.giftfromraymond.com has been teaching his true wealth secrets for over a quarter-century so you can double your income doing what you love.
Article Source: http://EzineArticles.com/?expert=Raymond_Aaron
Pay Off Your Mortgage Or Invest - What Would Warren Buffett Say?
According to Warren Buffett legendary investor of all time, when the tide goes out you will find out who's naked. Being in debt can only last so long. And if your home values fall or there is a stock market collapse you will quickly know if you are in a position to afford your home. If the greatest investor of all time can tell us to be debt free and invest in what we know, maybe we should take some lessons from him.
Depending on whom you ask you may get a conflicting view on what you should do with your money. Your financial advisor will still tell you to invest your money in the stock market even though the market has crashed in the last year. Why do they do that? Because it's all they know. You see they went to school for over four years, got significant experience in investing, at have to prove to themselves and the world that they know more than the average investor.
Well the stock market crash is changed all of that. You can no longer rely on your financial advisor to make specific financial decisions for you. You are ultimately responsible for your own investments and savings.
Now why would anyone consider that you should invest other than paying off your mortgage? Some reasons include getting a higher rate of return on your money, tax advantages and a whole lot off investment jargon to justify investing every single penny and not diversifying yourself by paying off debts as well.
Most people including your financial advisors gets confused about the concept of risk. Investment in the stock market has risk. In a classic example of this, is to look directly at your 401(k) retirement savings statement. If your retirement savings have been slashed by 40% since a year ago that means that investments carries risk.
But by all means you should always contribute to a 401 K and retirement savings account. It is the only way to accumulate the liquid cash for retirement.
But the stock market crash is taught us one lesson that we should be always diversified in our investment strategy. Paying off your mortgage carries no risk whatsoever. Once the mortgage is fully paid off, it does not matter what the market does, you have no more debt. Paying off your mortgage is at debt-free investment in yourself.
These are two sides to on deciding whether to invest or pay off your mortgage. One is a theoretical discussion about investing your money and getting a greater return on the stock market. This includes all the financial principles and methods to accumulate sufficient wealth in retirement.
Another side to investing a paying off your mortgage is what I refer to as the emotional side. Your home is not only an investment. It is it is a place of shelter and dreams for you and your family. Your emotional standard of living is invested in a home. If you lose your home means losing more than a financial asset.
If your home is such an emotional investment wouldn't it make sense to protect the one thing it represents more than a financial investment. Why would you not pay off your home have peace of mind and live a debt free lifestyle? And the best part is you have to take absolutely no risk to protect your family's future.
Paying off your home might mean losing tax deductions or not taking advantage of the increase in the stock market appreciation. Tax deductions are a poor argument for not paying your home off early. For every four dollars of interest to pay you may only get one dollar back in tax deduction. So why not keep the four dollars for yourself in the first place but paying off your mortgage faster.
The decision to pay off your mortgage or invest is a personal one. But the same time paying off your mortgage is a risk-free financial investment. As Warren Buffett says I invest in only what I understand.
To find how fast you can eliminate your debt or determine if you need to Pay Off Your Mortgage Or Invest , please go directly to into the free mortgage pay off calculator and within 4 seconds you will find out exactly if you can payoff your mortgage or invest simultaneously by using easy mortgage payoff strategies.
Plus we will give you a valuable guide to help you implement this program so that you can be on your way to being debt free today.
Article Source: http://EzineArticles.com/?expert=Neil_Venketramen
Depending on whom you ask you may get a conflicting view on what you should do with your money. Your financial advisor will still tell you to invest your money in the stock market even though the market has crashed in the last year. Why do they do that? Because it's all they know. You see they went to school for over four years, got significant experience in investing, at have to prove to themselves and the world that they know more than the average investor.
Well the stock market crash is changed all of that. You can no longer rely on your financial advisor to make specific financial decisions for you. You are ultimately responsible for your own investments and savings.
Now why would anyone consider that you should invest other than paying off your mortgage? Some reasons include getting a higher rate of return on your money, tax advantages and a whole lot off investment jargon to justify investing every single penny and not diversifying yourself by paying off debts as well.
Most people including your financial advisors gets confused about the concept of risk. Investment in the stock market has risk. In a classic example of this, is to look directly at your 401(k) retirement savings statement. If your retirement savings have been slashed by 40% since a year ago that means that investments carries risk.
But by all means you should always contribute to a 401 K and retirement savings account. It is the only way to accumulate the liquid cash for retirement.
But the stock market crash is taught us one lesson that we should be always diversified in our investment strategy. Paying off your mortgage carries no risk whatsoever. Once the mortgage is fully paid off, it does not matter what the market does, you have no more debt. Paying off your mortgage is at debt-free investment in yourself.
These are two sides to on deciding whether to invest or pay off your mortgage. One is a theoretical discussion about investing your money and getting a greater return on the stock market. This includes all the financial principles and methods to accumulate sufficient wealth in retirement.
Another side to investing a paying off your mortgage is what I refer to as the emotional side. Your home is not only an investment. It is it is a place of shelter and dreams for you and your family. Your emotional standard of living is invested in a home. If you lose your home means losing more than a financial asset.
If your home is such an emotional investment wouldn't it make sense to protect the one thing it represents more than a financial investment. Why would you not pay off your home have peace of mind and live a debt free lifestyle? And the best part is you have to take absolutely no risk to protect your family's future.
Paying off your home might mean losing tax deductions or not taking advantage of the increase in the stock market appreciation. Tax deductions are a poor argument for not paying your home off early. For every four dollars of interest to pay you may only get one dollar back in tax deduction. So why not keep the four dollars for yourself in the first place but paying off your mortgage faster.
The decision to pay off your mortgage or invest is a personal one. But the same time paying off your mortgage is a risk-free financial investment. As Warren Buffett says I invest in only what I understand.
To find how fast you can eliminate your debt or determine if you need to Pay Off Your Mortgage Or Invest , please go directly to into the free mortgage pay off calculator and within 4 seconds you will find out exactly if you can payoff your mortgage or invest simultaneously by using easy mortgage payoff strategies.
Plus we will give you a valuable guide to help you implement this program so that you can be on your way to being debt free today.
Article Source: http://EzineArticles.com/?expert=Neil_Venketramen
Minority Grants and Loans - Money That Never Has to Be Paid Back
Minority grants allow individuals to claim the cash they need for their personal use, and these funds never have to be paid back. Whether the goal is to pay down debt, go back to school, or to buy a new home, minority grant programs provide tax-free money to those who meet the eligibility requirements.
While the perception is that the government is just standing on the corner handing out hundred dollars bills to every individual that walks by, that is most certainly not the case. Applying for and receiving a grant can be a lot of work. It requires first finding the grant, researching the qualifications requirements, and then submitting your request.
When you apply for minority grants, it could require quite a bit of paperwork and putting together a grant proposal. The requirements and depth of your proposal varies from grant to grant, but you can always use the assistance of a grant writer to help you increase your chances of getting approved.
One thing to be aware of is not to be discouraged by the qualification requirements. Many people don't take the first step in submitting their application because they assume they will never get approved. There is no risk in applying for minority grants, and there is no limit in the number of grants you can apply for.
Once awarded your grant funds, just be sure to use the money in accordance to the terms of the program. That way you can be sure that you never have to pay the money back.
Access to the database and find free grant money.
Get Free Government Grants.
Article Source: http://EzineArticles.com/?expert=Austin_Warty
Austin Warty - EzineArticles Expert Author
While the perception is that the government is just standing on the corner handing out hundred dollars bills to every individual that walks by, that is most certainly not the case. Applying for and receiving a grant can be a lot of work. It requires first finding the grant, researching the qualifications requirements, and then submitting your request.
When you apply for minority grants, it could require quite a bit of paperwork and putting together a grant proposal. The requirements and depth of your proposal varies from grant to grant, but you can always use the assistance of a grant writer to help you increase your chances of getting approved.
One thing to be aware of is not to be discouraged by the qualification requirements. Many people don't take the first step in submitting their application because they assume they will never get approved. There is no risk in applying for minority grants, and there is no limit in the number of grants you can apply for.
Once awarded your grant funds, just be sure to use the money in accordance to the terms of the program. That way you can be sure that you never have to pay the money back.
Access to the database and find free grant money.
Get Free Government Grants.
Article Source: http://EzineArticles.com/?expert=Austin_Warty
Austin Warty - EzineArticles Expert Author
The Deflation Monster and Why it Will Stay Locked Away
There has been plenty of talk among Fed officials and financial pundits about deflation and the danger it poses to the economy. But what is deflation and why is it so scary? First, let's define the term. Just as inflation is viewed as a general rise in the overall price level, deflation is the opposite - a general decline in prices.
Imagine renewing season tickets to your favorite sports team and paying less than the prior year or getting an upgrade for the same price. Or sitting down at a restaurant you frequent and being handed a new menu with lower prices. At first glance, it sounds like economic nirvana! Let's be honest, who doesn't like paying less?
But a general drop in overall price level has its dark side and could turn a severe recession into another depression.
Let's look at a potential scenario. If falling prices take root in the economy, consumers would likely hold off on some purchases, further exacerbating the decline in economic activity. And businesses, faced with falling sales and profits, would respond by further slashing payrolls and/or cutting wages.
However, debt outstanding would remain intact and declining payrolls, combined with lower salaries, would likely push debt-strapped consumers further behind and into default. That would add pressure on an already-fragile banking system.
You can see how a downward spiral might get out of control.
Consequently, this economic scenario, which is akin to an economic black hole, is something the Federal Reserve and Fed Chairman Ben Bernanke are trying to avoid at all costs.
As many of us already know, wage growth has slowed considerably. But commodity prices, which virtually fell off of a cliff late last year, have edged off recent lows, while crude and gasoline prices have rebounded considerably. The memory of filling up my tank at $1.35 per gallon late last year is but a distant memory.
Plus, the rate of deterioration in the economy appears to be slowing, lessening the odds we will see a brush with deflation. Moreover, consumer surveys show that inflation expectations remain modest, which means that most businesses aren't feeling pressure to permanently cut prices in order to attract buyers.
Unless the rapid decline in economic activity continues, and the odds of this happening are starting to recede, the risk of deflation seems remote.
Charles Sherry
Tomorrow's Economy Today
http://economytodaytomorrow.com
Article Source: http://EzineArticles.com/?expert=Charles_Sherry
Imagine renewing season tickets to your favorite sports team and paying less than the prior year or getting an upgrade for the same price. Or sitting down at a restaurant you frequent and being handed a new menu with lower prices. At first glance, it sounds like economic nirvana! Let's be honest, who doesn't like paying less?
But a general drop in overall price level has its dark side and could turn a severe recession into another depression.
Let's look at a potential scenario. If falling prices take root in the economy, consumers would likely hold off on some purchases, further exacerbating the decline in economic activity. And businesses, faced with falling sales and profits, would respond by further slashing payrolls and/or cutting wages.
However, debt outstanding would remain intact and declining payrolls, combined with lower salaries, would likely push debt-strapped consumers further behind and into default. That would add pressure on an already-fragile banking system.
You can see how a downward spiral might get out of control.
Consequently, this economic scenario, which is akin to an economic black hole, is something the Federal Reserve and Fed Chairman Ben Bernanke are trying to avoid at all costs.
As many of us already know, wage growth has slowed considerably. But commodity prices, which virtually fell off of a cliff late last year, have edged off recent lows, while crude and gasoline prices have rebounded considerably. The memory of filling up my tank at $1.35 per gallon late last year is but a distant memory.
Plus, the rate of deterioration in the economy appears to be slowing, lessening the odds we will see a brush with deflation. Moreover, consumer surveys show that inflation expectations remain modest, which means that most businesses aren't feeling pressure to permanently cut prices in order to attract buyers.
Unless the rapid decline in economic activity continues, and the odds of this happening are starting to recede, the risk of deflation seems remote.
Charles Sherry
Tomorrow's Economy Today
http://economytodaytomorrow.com
Article Source: http://EzineArticles.com/?expert=Charles_Sherry
Designing Activity Based Costing (ABC) Systems
Introduction
Activity based costing is essentially a change in accent. People carry out activities and activities consume resources. Therefore, by controlling activities the manager is ensuring that costs are controlled at their source. A wise manager will not concentrate on how to calculate product costs but will concentrate more on why the costs were there in the first place. When designing an activity based costing system this should be used as a departure point.
In order to design an activity based costing system it is important to remember that the objectives should be met at the minimum cost and complexity. To be successful, the final activity based costing system should provide the right kind of information at the right level of detail. In addition to this the design of the system should be as simple as possible without being too simple, since it may report inaccurate costs if it is too simple. The answer is to strike a balance between simplicity and complexity.
In addition to this, performance measures should be identified at process level and for key activities. They should be used to monitor and evaluate activities or processes and must be used to promote consistent improvement. This should be done without unnecessarily complicating the design of the system.
It is true that managers too often focus on precision and ignore how accurate the data used are. This can lead to the erroneous assumption by a manager that information is more exact than it really is.
The seven assumptions underlying the design of an activity based costing system are that:
1. Activities in a business consume resources
2. Producing products or servicing customers utilize activities
3. The Business model is focussed on consumption rather than spending
4. Consuming company resources can have numerous causes
5. A wide variety of activities can be identified and measured in any company
6. Cost pools should be homogeneous
7. Costs in each pool are variable (strictly proportional to activity).
There are a number of different approached possible when introducing an activity based costing system, the following steps are generally accepted to be present in most system implementation processes:
STEP 1: Identified all the major activities.
STEP 2: Established the major resource pools.
STEP 3: Collected cost driver information, assigned costs to each activity, and calculated cost per outcome.
STEP 4: Analysed processes with costs, outcomes, and benchmarks.
STEP 5: Identified additional improvement opportunities.
To introduce an activity based costing system, it is essential to combine it with practical business operations. The elected function should be profitability management which will provide an ideal pilot area for learning about activity based costing whilst, at the same time, furthering company understanding about the relationship between product turnover and customer dividends.
Different authors suggest different methods to be followed in designing an activity based costing system. From the various proposed methods it is recommended that the following design steps are followed:
Process Value Analysis
The first step involved in the design of an activity based costing system should be to do a process value analysis. A process value analysis is a systematic method of identifying activities involved in the processes of the organisation.
When doing this the first stage is to identify the primary activities in the organisation. Here it is important to match the detail of the activities to the purpose of the final costing model.
In order to achieve simplicity, the aggregation of related activities to balance conflicting objectives, can be effectively used. Activities that are too small and insignificant should be combined to reduce system confusion. A clear and consistent description of activities makes it easy to isolate similar activities or processes. The isolation and clear documentation of the value adding activities are essential for the next step in the process.
Creating Activity Centers
Once the process value analysis is complete the next step is to create activity centres. An activity centre can be defined as a cluster of related activities. The purpose of activity centres is that they give structure to activity information in the system and facilitate reports about related activities. In activity based costing systems the primary element is activities. The next step is the assignment of cost of various activities to activity cost pools and then to assign these costs to products.
It is unnecessary and costly to consider every single activity as an independent activity centre. It is better to integrate several associated activities into one cost centre, to decrease the amount of detail and record keeping cost involved. A two-phased cost-driver approach is recommended to assist with the pooling of costs into activity centres before subsequent allocation to products.
The result of activity combining is to better the correctness of product costs, the actual improvement lay in the capability, first, to query the presence of activities and associated costs and, second, to begin measuring activity achievement.
An activity based costing system assign costs to products or customers in two stages. In stage one, costs are assigned to activities, and, in stage two, costs are assigned from activities to products or customers with the use of cost drivers. This should be kept in mind when creating activity centres during the design of the system.
Whilst every effort should be made to calculate activity based costing for all products, the real emphasis should be placed in ensuring the accuracy of activity based costing attributed to product families at which level the decision making process was most critical. The greatest accuracy in costing is achieved by recognising four levels of activities, with several of these levels then subdivided into specific activity centres.
This approach is given substance when one views this as four general levels of activities
1. Unit-level activities
A unit level activity is an activity performed on units of products. Activity drivers for this type of activity can be direct labour hours or machine hours.
2. Batch-level activities
Batch activities are performed on batches of products rather than individual product units. Activity drivers for this type of activity can be number of movements or number of runs.
3. Product-level activities
Product activities benefit all units of a particular product. Activity drivers for this type of activity can be number of machine set-ups to produce a batch of products or engineering change notices.
4. Facility-level activities
Facility activities sustain the general processes in a facility. Facility level costs include items normally described as general overheads. This may include financing and other management cost not attributable to any of the previous levels of activities.
In order to achieve the greatest benefit from the introduction of an activity based costing system it is imperative to isolate the various levels of activities in accordance with the four activity levels described above.
Defining Resource Drivers
The next step in the design process of an activity based costing system is defining the resource drivers. They in turn define the resource consumption of activities. The factors that have to be considered when defining a resource driver, includes the ease of collecting relevant resource driver data and the level to which the resource driver really measures the consumption by the product.
The adoption of the activity based approach to cost collection, revealed that there were logical separations in the manufacturing and distribution processes for which costs were easy to pool. More significant is that completed products are directed through different sub-processes, depending on type and complexity of the manufacturing process.
This results in two major advantages. The first is that the assignment of costs from activity pools to products can be done in a far more concentrated and differentiated way. The second is that the activities themselves can be measured and targeted for improvement. It is therefore important to note that cost should be traced wherever possible and only allocated in the final stages.
Determining Attributes
In the first generation systems, activities were distinguished initially, and costs were allocated to corresponding activities. Product costs were evolved from this. In the second-generation system, processes were distinguished and activities linked to the processes.
When implementing an activity based costing process more efficiently a company should define processes before it attempts to associate related activities to the defined process. Processes should not be forced or defined to fit activities; activities should fit processes. It is for this reason important to attach labels that enhance the meaning of the activity based information to the data in the system. Some sensitive attributes should be left to the user to create.
Selecting Activity Drivers An activity driver is the factor that measures the activity consumption of a cost object. A cost object is generally defined as the reason for carrying out the activity.
Activity based costing requires that attention be given to a different product costing approach. The primary contribution of the activity based costing system is the recognition that cost drivers may encompass more than one facet of an organisation. Utilizing an activity based costing approach correctly revealed that low-volume products having significant transaction costs were unprofitable.
The successful selection of activity drives will result in dividing the costs into value-added and non-value-added components, with cost drivers separated into volume-related and transaction-related categories. This will result in approaching cost drivers as a way to manage and control expenses.
When selecting an activity driver, care should be taken as not all cost drivers are volume related and sometimes the drivers associated with transactions have a greater cost than the cost drivers associated with volume.
Activity drivers merge the requirements that cost objects places on activities. The importance of selecting activity drivers accurately cannot be over emphasised. This will impact on the accuracy of the costing of cost objects.
Conclusion
The design of an Activity Based Costing system is a complicated and complex process that needs the cooperation of many different functional heads in an organization. To simply match the level of the activity driver with the activity does not always ensure that the desired level of accuracy is achieved.
A part of the answer may be found in involving the correctly motivated individuals at the correct time with a strong mandate and then to let the team establish the correlation between the performance of the activity and the activity driver.
©2009 Carl Marx
Dr. Carl Marx completed his Doctorate in Business Administration (DBA). He was awarded the best financial student award at the completion of his MBA. He has extensive experience in providing multi cultural clients with business solutions.
He is widely published in the printed and electronic media in fields as diverse as Financial Management, Risk Management, Safety Management and the Law.
Dr Marx have extensive experience in providing successful solutions to clients in more than 14 Countries, including China, Indonesia, Malaysia, Papa new Guinea, Australia, South Africa, Uganda, Ghana, Saudi Arabia, Brazil, Mexico the US and the UK.
You are welcome to contact Dr. Marx at drcmarx@gmail.com for any help or support needed.
Additional information and resources can be found at http://financialsupport.weebly.com
Article Source: http://EzineArticles.com/?expert=Carl_Marx
Activity based costing is essentially a change in accent. People carry out activities and activities consume resources. Therefore, by controlling activities the manager is ensuring that costs are controlled at their source. A wise manager will not concentrate on how to calculate product costs but will concentrate more on why the costs were there in the first place. When designing an activity based costing system this should be used as a departure point.
In order to design an activity based costing system it is important to remember that the objectives should be met at the minimum cost and complexity. To be successful, the final activity based costing system should provide the right kind of information at the right level of detail. In addition to this the design of the system should be as simple as possible without being too simple, since it may report inaccurate costs if it is too simple. The answer is to strike a balance between simplicity and complexity.
In addition to this, performance measures should be identified at process level and for key activities. They should be used to monitor and evaluate activities or processes and must be used to promote consistent improvement. This should be done without unnecessarily complicating the design of the system.
It is true that managers too often focus on precision and ignore how accurate the data used are. This can lead to the erroneous assumption by a manager that information is more exact than it really is.
The seven assumptions underlying the design of an activity based costing system are that:
1. Activities in a business consume resources
2. Producing products or servicing customers utilize activities
3. The Business model is focussed on consumption rather than spending
4. Consuming company resources can have numerous causes
5. A wide variety of activities can be identified and measured in any company
6. Cost pools should be homogeneous
7. Costs in each pool are variable (strictly proportional to activity).
There are a number of different approached possible when introducing an activity based costing system, the following steps are generally accepted to be present in most system implementation processes:
STEP 1: Identified all the major activities.
STEP 2: Established the major resource pools.
STEP 3: Collected cost driver information, assigned costs to each activity, and calculated cost per outcome.
STEP 4: Analysed processes with costs, outcomes, and benchmarks.
STEP 5: Identified additional improvement opportunities.
To introduce an activity based costing system, it is essential to combine it with practical business operations. The elected function should be profitability management which will provide an ideal pilot area for learning about activity based costing whilst, at the same time, furthering company understanding about the relationship between product turnover and customer dividends.
Different authors suggest different methods to be followed in designing an activity based costing system. From the various proposed methods it is recommended that the following design steps are followed:
Process Value Analysis
The first step involved in the design of an activity based costing system should be to do a process value analysis. A process value analysis is a systematic method of identifying activities involved in the processes of the organisation.
When doing this the first stage is to identify the primary activities in the organisation. Here it is important to match the detail of the activities to the purpose of the final costing model.
In order to achieve simplicity, the aggregation of related activities to balance conflicting objectives, can be effectively used. Activities that are too small and insignificant should be combined to reduce system confusion. A clear and consistent description of activities makes it easy to isolate similar activities or processes. The isolation and clear documentation of the value adding activities are essential for the next step in the process.
Creating Activity Centers
Once the process value analysis is complete the next step is to create activity centres. An activity centre can be defined as a cluster of related activities. The purpose of activity centres is that they give structure to activity information in the system and facilitate reports about related activities. In activity based costing systems the primary element is activities. The next step is the assignment of cost of various activities to activity cost pools and then to assign these costs to products.
It is unnecessary and costly to consider every single activity as an independent activity centre. It is better to integrate several associated activities into one cost centre, to decrease the amount of detail and record keeping cost involved. A two-phased cost-driver approach is recommended to assist with the pooling of costs into activity centres before subsequent allocation to products.
The result of activity combining is to better the correctness of product costs, the actual improvement lay in the capability, first, to query the presence of activities and associated costs and, second, to begin measuring activity achievement.
An activity based costing system assign costs to products or customers in two stages. In stage one, costs are assigned to activities, and, in stage two, costs are assigned from activities to products or customers with the use of cost drivers. This should be kept in mind when creating activity centres during the design of the system.
Whilst every effort should be made to calculate activity based costing for all products, the real emphasis should be placed in ensuring the accuracy of activity based costing attributed to product families at which level the decision making process was most critical. The greatest accuracy in costing is achieved by recognising four levels of activities, with several of these levels then subdivided into specific activity centres.
This approach is given substance when one views this as four general levels of activities
1. Unit-level activities
A unit level activity is an activity performed on units of products. Activity drivers for this type of activity can be direct labour hours or machine hours.
2. Batch-level activities
Batch activities are performed on batches of products rather than individual product units. Activity drivers for this type of activity can be number of movements or number of runs.
3. Product-level activities
Product activities benefit all units of a particular product. Activity drivers for this type of activity can be number of machine set-ups to produce a batch of products or engineering change notices.
4. Facility-level activities
Facility activities sustain the general processes in a facility. Facility level costs include items normally described as general overheads. This may include financing and other management cost not attributable to any of the previous levels of activities.
In order to achieve the greatest benefit from the introduction of an activity based costing system it is imperative to isolate the various levels of activities in accordance with the four activity levels described above.
Defining Resource Drivers
The next step in the design process of an activity based costing system is defining the resource drivers. They in turn define the resource consumption of activities. The factors that have to be considered when defining a resource driver, includes the ease of collecting relevant resource driver data and the level to which the resource driver really measures the consumption by the product.
The adoption of the activity based approach to cost collection, revealed that there were logical separations in the manufacturing and distribution processes for which costs were easy to pool. More significant is that completed products are directed through different sub-processes, depending on type and complexity of the manufacturing process.
This results in two major advantages. The first is that the assignment of costs from activity pools to products can be done in a far more concentrated and differentiated way. The second is that the activities themselves can be measured and targeted for improvement. It is therefore important to note that cost should be traced wherever possible and only allocated in the final stages.
Determining Attributes
In the first generation systems, activities were distinguished initially, and costs were allocated to corresponding activities. Product costs were evolved from this. In the second-generation system, processes were distinguished and activities linked to the processes.
When implementing an activity based costing process more efficiently a company should define processes before it attempts to associate related activities to the defined process. Processes should not be forced or defined to fit activities; activities should fit processes. It is for this reason important to attach labels that enhance the meaning of the activity based information to the data in the system. Some sensitive attributes should be left to the user to create.
Selecting Activity Drivers An activity driver is the factor that measures the activity consumption of a cost object. A cost object is generally defined as the reason for carrying out the activity.
Activity based costing requires that attention be given to a different product costing approach. The primary contribution of the activity based costing system is the recognition that cost drivers may encompass more than one facet of an organisation. Utilizing an activity based costing approach correctly revealed that low-volume products having significant transaction costs were unprofitable.
The successful selection of activity drives will result in dividing the costs into value-added and non-value-added components, with cost drivers separated into volume-related and transaction-related categories. This will result in approaching cost drivers as a way to manage and control expenses.
When selecting an activity driver, care should be taken as not all cost drivers are volume related and sometimes the drivers associated with transactions have a greater cost than the cost drivers associated with volume.
Activity drivers merge the requirements that cost objects places on activities. The importance of selecting activity drivers accurately cannot be over emphasised. This will impact on the accuracy of the costing of cost objects.
Conclusion
The design of an Activity Based Costing system is a complicated and complex process that needs the cooperation of many different functional heads in an organization. To simply match the level of the activity driver with the activity does not always ensure that the desired level of accuracy is achieved.
A part of the answer may be found in involving the correctly motivated individuals at the correct time with a strong mandate and then to let the team establish the correlation between the performance of the activity and the activity driver.
©2009 Carl Marx
Dr. Carl Marx completed his Doctorate in Business Administration (DBA). He was awarded the best financial student award at the completion of his MBA. He has extensive experience in providing multi cultural clients with business solutions.
He is widely published in the printed and electronic media in fields as diverse as Financial Management, Risk Management, Safety Management and the Law.
Dr Marx have extensive experience in providing successful solutions to clients in more than 14 Countries, including China, Indonesia, Malaysia, Papa new Guinea, Australia, South Africa, Uganda, Ghana, Saudi Arabia, Brazil, Mexico the US and the UK.
You are welcome to contact Dr. Marx at drcmarx@gmail.com for any help or support needed.
Additional information and resources can be found at http://financialsupport.weebly.com
Article Source: http://EzineArticles.com/?expert=Carl_Marx
Banking is a Safe Bet For 21st Century Savers
The days of squirreling money away under mattresses have long since been consigned to the history books. For centuries now, banks have acted under licence from governments to provide a number of financial services, both to businesses and the general public alike.
Even in recent years though there may still have been a mild undercurrent of mistrust relating to banks among the older generation, due perhaps to a misguided notion about what the bank would be doing with their hard-earned money.
However, with advances in technology and the tightening of financial regulations it's probably safe to say that this attitude is gradually becoming a thing of the past and most people would acknowledge that, for the most part, banks are safe as houses.
Ease of access has probably had a lot to do with this shifting attitude too. With the global introduction of ATM machines over the past few decades, people can now access their money 24 hours a day and no longer have to queue in their lunch hour or wait over the weekend if they run short of cash.
Moreover, with the advent of the internet era banking has become more transparent than ever. Online banking has revolutionised the way people manage their personal finances and they can now view statements, transfer money and pay bills all from the comfort of their own living room.
Indeed, at a time when the global economy is suffering somewhat of a downturn, many people may feel that the best way to protect themselves is to spread their finances around various different banking institutions, so that they don't lose all their money in the event of one of the banks going bankrupt. But this may not be necessary.
Government-sanctioned bodies such as the Financial Services Authority (FSA) and the Financial Ombudsman Service (FOS) exist to ensure fair and even-handed financial services are provided to businesses and the general public, and to regulate bodies who accept monetary deposits. Essentially, this means that all banks have a higher authority to answer to and helps to provide additional protection for savers and investors.
But for those who are still concerned about the short and long term safety of their savings, there is nothing more reassuring than a full and unconditional deposit guarantee which means that, whatever happens, their money is safe. Countless financial institutions now provide a deposit guarantee which means that safe savings are a reality now for most people. And this can only be good news for those worried about how the economic downturn might affect them.
Adam Singleton writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.
Article Source: http://EzineArticles.com/?expert=Adam_Singleton
Even in recent years though there may still have been a mild undercurrent of mistrust relating to banks among the older generation, due perhaps to a misguided notion about what the bank would be doing with their hard-earned money.
However, with advances in technology and the tightening of financial regulations it's probably safe to say that this attitude is gradually becoming a thing of the past and most people would acknowledge that, for the most part, banks are safe as houses.
Ease of access has probably had a lot to do with this shifting attitude too. With the global introduction of ATM machines over the past few decades, people can now access their money 24 hours a day and no longer have to queue in their lunch hour or wait over the weekend if they run short of cash.
Moreover, with the advent of the internet era banking has become more transparent than ever. Online banking has revolutionised the way people manage their personal finances and they can now view statements, transfer money and pay bills all from the comfort of their own living room.
Indeed, at a time when the global economy is suffering somewhat of a downturn, many people may feel that the best way to protect themselves is to spread their finances around various different banking institutions, so that they don't lose all their money in the event of one of the banks going bankrupt. But this may not be necessary.
Government-sanctioned bodies such as the Financial Services Authority (FSA) and the Financial Ombudsman Service (FOS) exist to ensure fair and even-handed financial services are provided to businesses and the general public, and to regulate bodies who accept monetary deposits. Essentially, this means that all banks have a higher authority to answer to and helps to provide additional protection for savers and investors.
But for those who are still concerned about the short and long term safety of their savings, there is nothing more reassuring than a full and unconditional deposit guarantee which means that, whatever happens, their money is safe. Countless financial institutions now provide a deposit guarantee which means that safe savings are a reality now for most people. And this can only be good news for those worried about how the economic downturn might affect them.
Adam Singleton writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.
Article Source: http://EzineArticles.com/?expert=Adam_Singleton
Compound Interest, How Important is It?
"Man's greatest invention is compound interest" - Albert Einstein
Compound interest gives money the opportunity to grow all by itself. By using compound interest we "don't work for money but we let money work for us". You leave money in investments that give you good returns and it will grow all by itself. Just like a little plant, you leave it alone and come back after years only to find out that it just isn't a plant anymore but a large tree.
Let me give an example:
You have $10,000 right now but you don't know how to spend it. So, you placed the cash on an investment that earns 10% interest yearly. So, you will be receiving $1,000 a year and if you take that money and use it, you will be left with the same $10,000 you began with. Ok, lets say you decided to leave that $10,000 alone to grow. After 10 years that $10,000 would be $25,938! Even better, after 15 years it would be $41,772! So, if you took the yearly interest, you would benefit only $15,000 however if you leave it alone you benefit $41,722 after 15 years. That is more than DOUBLE the amount in which you would have received if you took the yearly interest.
This is the power of compound interest. It can make you earn a lot more than just saving the money!
Let's say you save $100 per month earning 5% yearly for 40 years. By the power of compound interest, it will grow to about $152,000 and if you double it to $200 it will simply be doubled to $304,000!
At 10% interest rate, saving $100 a month would earn $620,000! That is Quadruple the amount of the 5% interest rate! Ok, now can you see the power of compound interest?
And on top of all that, you are not taking high risks when you use the power of compound interest. You just need to know how to use compound interest at your advantage! Your key here is TIME and CAPITAL money. They more time you let the money grow and money you put, the larger the amount would be! Just make sure to look for investments that has above 10% interest rate in order put your savings into good use!
If you want to know more please visit http://www.compoundsavingsinterest.blogspot.com for more articles on the path to financial success!
Article Source: http://EzineArticles.com/?expert=Jonathan_Quiogue
Compound interest gives money the opportunity to grow all by itself. By using compound interest we "don't work for money but we let money work for us". You leave money in investments that give you good returns and it will grow all by itself. Just like a little plant, you leave it alone and come back after years only to find out that it just isn't a plant anymore but a large tree.
Let me give an example:
You have $10,000 right now but you don't know how to spend it. So, you placed the cash on an investment that earns 10% interest yearly. So, you will be receiving $1,000 a year and if you take that money and use it, you will be left with the same $10,000 you began with. Ok, lets say you decided to leave that $10,000 alone to grow. After 10 years that $10,000 would be $25,938! Even better, after 15 years it would be $41,772! So, if you took the yearly interest, you would benefit only $15,000 however if you leave it alone you benefit $41,722 after 15 years. That is more than DOUBLE the amount in which you would have received if you took the yearly interest.
This is the power of compound interest. It can make you earn a lot more than just saving the money!
Let's say you save $100 per month earning 5% yearly for 40 years. By the power of compound interest, it will grow to about $152,000 and if you double it to $200 it will simply be doubled to $304,000!
At 10% interest rate, saving $100 a month would earn $620,000! That is Quadruple the amount of the 5% interest rate! Ok, now can you see the power of compound interest?
And on top of all that, you are not taking high risks when you use the power of compound interest. You just need to know how to use compound interest at your advantage! Your key here is TIME and CAPITAL money. They more time you let the money grow and money you put, the larger the amount would be! Just make sure to look for investments that has above 10% interest rate in order put your savings into good use!
If you want to know more please visit http://www.compoundsavingsinterest.blogspot.com for more articles on the path to financial success!
Article Source: http://EzineArticles.com/?expert=Jonathan_Quiogue
วันเสาร์ที่ 2 พฤษภาคม พ.ศ. 2552
Structured Finance
Structured finance is a very broad term, which is used to refer to a sector of finance, which was developed to help in transferring risk with the help of complex legal, as well as corporate entities. Such a risk transfer as useful in securitization of different financial assets, such as credit card receivables, mortgages and auto loans, has helped in opening up new avenues of financing for consumers. However, this has also been believed to contribute to the degradation of the underwriting standards of such financial assets. This helped in the rise to the credit bubble, as well as the credit crash experienced a few years ago.
As it is, securitization is a method which is employed by the participants of structured finance, in order to set up the pools of assets, which are used for the creation of end product financial instruments.
An important concept in terms of structured finance is that of tranching. It is a system, which is used for creating different investment categories for securities, which are created in the arena of structured finance. It helps the cash flow from underlying asset to get diverted to several investor groups. A major objective of the process of tranching is to set up at least a single category of securities with rating higher than an average rating of underlying collateral pool or for creating rated securities from a group of unrated assets. Now, this is done with the usage of credit support, like prioritization of payments in regard to various tranches.
As it is, credit enhancement is a key for creation of a security, which has an elevated rating than an issuing company. Credit enhancement might be created through issuance of subordinate bonds. These bonds are allocated the losses from the collateral prior to losses being allocated to Senior Bonds, thereby giving the senior bonds credit enhancement. Also, several deals, particularly, deals, which involve riskier collateral like subprime collateral, use overcollateralization along with subordination.
In case of over collaterization, the balance of loans is higher than balance of the Bonds, thereby creating extra interest in the deal. The extra interest might be used for offsetting collateral losses before the losses have been allocated to the bondholders thereby providing an additional credit enhancement. As it is, another credit enhancement includes the usage of derivatives like corridors, swap and caps. Apart from that, ratings too play a very important role in case of structured finance.
To read more about Finance Advisor Board visit Finance Advisor Board Learn more about Finance News
Article Source: http://EzineArticles.com/?expert=Helga_Bowl
As it is, securitization is a method which is employed by the participants of structured finance, in order to set up the pools of assets, which are used for the creation of end product financial instruments.
An important concept in terms of structured finance is that of tranching. It is a system, which is used for creating different investment categories for securities, which are created in the arena of structured finance. It helps the cash flow from underlying asset to get diverted to several investor groups. A major objective of the process of tranching is to set up at least a single category of securities with rating higher than an average rating of underlying collateral pool or for creating rated securities from a group of unrated assets. Now, this is done with the usage of credit support, like prioritization of payments in regard to various tranches.
As it is, credit enhancement is a key for creation of a security, which has an elevated rating than an issuing company. Credit enhancement might be created through issuance of subordinate bonds. These bonds are allocated the losses from the collateral prior to losses being allocated to Senior Bonds, thereby giving the senior bonds credit enhancement. Also, several deals, particularly, deals, which involve riskier collateral like subprime collateral, use overcollateralization along with subordination.
In case of over collaterization, the balance of loans is higher than balance of the Bonds, thereby creating extra interest in the deal. The extra interest might be used for offsetting collateral losses before the losses have been allocated to the bondholders thereby providing an additional credit enhancement. As it is, another credit enhancement includes the usage of derivatives like corridors, swap and caps. Apart from that, ratings too play a very important role in case of structured finance.
To read more about Finance Advisor Board visit Finance Advisor Board Learn more about Finance News
Article Source: http://EzineArticles.com/?expert=Helga_Bowl
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