Friday, February 12, 2016

5 Financial Endeavors That Will Benefit Your Family

Raising a family can be challenging both emotionally and financially. Being responsible and proactive with your earnings will pay off in the long run. Consider using these five strategies to make the most of your money and prepare for the future.

Track Your Bills at all Times

In order to fully understand where your money goes every month, create an organized list of your monthly bills. Separate your bills into different categories, such as loans, utilities, medical, and food. Review your bills to determine if there are any monthly charges that are not useful to your family. 

Many people have subscriptions to magazines, gyms, and other types of entertainment that they do not use regularly and could cancel to save money. Additionally, research the price you pay for services to determine if you have the best rates available.

Create a Budget

After reviewing your bills, determine how much you can comfortably spend on each expense, while still staving money. Some expenses may be difficult to change, but others like entertainment and food are often overlooked as a large source of spending. 

These bills can easily be scaled back with planning meals ahead and becoming creative with inexpensive family outings. 

Understand Your Resources

Life can be unpredictable and present many challenges. Review the benefits that your employer offers, as well as any community programs that you may qualify for in the event of an emergency. 

If you become injured and are unable to work, you may need to discuss your rights with a social security disability lawyer to ensure you receive assistance if you qualify for social security disability benefits. You should also become familiar with retirement plans your employer offers to maximize the contributions made to your account. 

 Professionals, like those at, will give you an honest opinion about being approved for benefits. This is an important step when it comes to receiving social security.

Purchase a Life Insurance Policy

It’s never too soon to financially protect your loved ones. Even if you can’t afford a large policy, invest in a basic policy that will at least cover funeral expenses and ideally your bills for one year. 

Set Goals Together

All families have dreams for the future, such as taking a vacation or remodeling their home. In order to reach these goals, be realistic with how much you can spend and create a monthly savings plan. 

Having regular discussions about the financial goals your family has can keep you on track and motivated to reach those goals.

When you understand your personal finances and have created an efficient plan to save money, you and your family will experience reduced stress and the benefits of a larger savings account.

Wednesday, February 10, 2016

How To Score With FICO

When it comes to getting a loan for a new car, new home, or new business, you've got to be fully prepared. This preparation involves many things, but the biggest issue at hand is having a credit rating that will enable a bank or lender to judge you as an acceptable prospect for a major loan. 

If you don't have a good enough score to back up your claims, you'll quickly find yourself rejected and out of luck. So, before you even think of applying for a loan, it's an excellent idea to know exactly what you need for a good credit score. 

What Exactly Is Your FICO Score?

FICO is an acronym that stands for Fair Isaac Score, the company that created this credit scoring system. This is the system by which your credit score will ultimately be calculated. Banks and lenders will use your FICO score as the primary means of judging whether or not you are a good risk for a loan. 

If your score is anywhere from average to high, you'll have a good chance of securing a loan. If your score is less than average, you're going to have to do some serious repair work before you can even think about getting a loan in the near future.


How Is Your FICO Score Calculated?

The components that go into measuring your ultimate FICO score can be broken down in the following manner:

  • Your payment history will count for 35 percent of your score. This includes all of the payments you have made via the medium of credit, as well as a complete record of whether you have made all of these payments in a timely manner.
  • 30 percent of your FICO score will be determined by the amount of money you still owe via the medium of credit.
  • 15 percent of your score will come from the length of your credit history. A person with a long history of paying by credit in a timely fashion will have an advantage over someone who has a bad credit history, or very little credit history.
  • 10 percent of your score comes from what is termed "credit mix in use." This term covers the mix you may have of credit cards, credit accounts from retail stores, any loans you may be paying off via installment plans, whether or not you are currently paying off a mortgage loan, and any open accounts you may have with a finance company. 

The final 10 percent of your score will come from whether or not you are considered "new credit", i.e., whether you have a very recent and limited credit history, or whether you have taken out credit with a variety of sources in a very short and recent amount of time.

What Is In Your Credit Report?

The best way to get an accurate look at your FICO score and overall state of credit is to apply to receive your credit report. This credit report will consist of the following items:

  • All of your basic information (name, address, Social Security number, date of birth, employment history).
  • Trade lines. These are all of your credit accounts, including a full history of when you opened your account, your credit history, all of your outstanding payments, your maximum line of credit, etc. 
  • Credit inquiries. A complete list of everyone who has accessed your credit report within the past two years. You authorize this inquiry when you apply for a loan.
  • Public Record and Collections. Credit reporting agencies are authorized to collect information from state and county courts concerning bankruptcy proceedings, property foreclosures, wage attachments, settlements of lawsuits, foreclosures, liens, and other related matters.

Get Your Credit Report Today

If you have any doubts about the accuracy or the overall strength of your credit, it's an excellent idea to obtain your free credit report today. The sooner you do so, the sooner you can settle all doubt on the issue and get a realistic, accurate assessment of your credit. 

This way, if there are any areas that you care to dispute, you can do so in a timely manner. If there are other areas that are accurate, but definitely cast your credit in a bad light, you can work to improve them before applying for a major loan.

You can apply to observe your credit report today. It will give you a complete look at all of the above listed components that make up your FICO score. The sooner you have this information, the sooner you can make all of the necessary adjustments in order to render your score as strong as possible. 

Getting your credit report is the first step toward positioning yourself for success in all of your future financial and business pursuits.

Why Consumers Are Afraid Of Credit Cards? – 4 Main Fears

At times of unstable economical situation many American consumers have found themselves afraid of anything associated with debt, and credit cards are one of the financial tools that come first in the list. So let’s figure out if credit cards are really that scary and how to avoid making costly mistakes.

Here are the four main fears related to the credit card use:

1. Overspending.

This concern is one of the most important as many people really spend more than they should while using credit cards. But other forms of payment can also lead to overspending, so just concentrate on tracking your spending. 

You can do it online, in real time. It’s also very convenient to use the mobile app, if it is provided by a credit card issuer. With many accounts, credit card users may set alerts to be reminded that the preset threshold has been reached. Take advantage of such options!

2. Missing the Payment Due Date.

If you miss credit card payment, be sure to be charged costly fees and penalties. But you can simply do your best to avoid such situations by setting up certain reminders online as well as using an auto-payment system that is offered by most of credit card issuers. 

Besides, you can do some research to find the cards which have no penalty interest rates or late fees (for example, Citi Simplicity or PenFed Promise). Still there is a risk that your late payments can be reported to the credit agencies, meaning that your credit score can be negatively impacted. So, reminders seem to be the best option.

3. Annual Fees.

Annual fees are one of the reasons why people avoid using credit cards. But there is a way out. Premium credit cards are usually associated with the annual fees which are justified with the offered benefits and rewards. 

However, there are still cards which are offered with no annual fees, but also have certain advantages. Consider such credit cards as Discover it, Chase Slate, Citi Double Cash, etc.

4. Other Extra Fees.

In addition to late and annual fees, some Americans are afraid of other charges which may be associated with the credit card they use. The thing is most credit card issues charge additional fees for balance transfers, cash advances, foreign transactions, etc. 

And that can be rather costly. Thankfully, you can choose among simple credit cards which are provided with no additional fees mentioned. Just do some research and find the card that suits all your needs and wishes.

So, there is no need to be afraid of any financial services offered today. Many of them are really useful and may work for your benefit, if you make the right choice. Most of American consumers and people all over the world get used to paying with credit cards as it is very convenient. 

Maybe it is not necessary to refuse using the option? Just spend some time for careful research and be sure to find what you need.

Tuesday, February 9, 2016

How You Can Prepare Yourself Financially to Purchase a Home in Retirement

For most people, buying a house is the single largest financial transaction of their lives. Purchasing a new home at the right price and with favorable terms and interest rate can put you and your family on the road to a good financial future. Patience and preparation are the keys that will unlock the door of your dream home.

Monitor Your Credit

Mortgage lenders like to see credit scores of at least 700. You'll pay higher interest with a lower score, and might be denied a loan altogether. Check your credit regularly and make sure there are no errors that reduce your score. Also, it can hurt your credit when you apply for mortgage financing from multiple lenders. Only apply when you're ready to move forward with the home purchase.

Build Savings

Plan on saving about 10 percent of the purchase price for a down payment. It's wise to have more savings to cover closing costs, and an emergency reserve equal to several months’ expenses. The bottom line is that the more cash you have saved up, the more likely it is lenders will offer good rates.

Educate Yourself

Understanding the mortgage process is a vital part of preparing to buy a home. You must decide between a fixed rate and an adjustable rate mortgage. Fixed rate financing is the most expensive. However, an ARM can end up costing more if interest rates rise. Make sure you know how closing costs and other fees will affect the financing of your home.

Ask the Experts and Compare

When you shop for mortgage interest rates, consult experts. Start with the loan officer at your bank and your real estate agent. Comparison shop by contacting loan officers at other banks, credit unions and other mortgage lenders.

The FHA and VA

The FHA and VA loans are a good place to start. With an FHA loan, you may need no more than a 3.5 percent down and credit requirements are less stringent than for regular mortgages. You will have to purchase mortgage insurance. Veterans and military service members qualify for VA loans. 

In some cases, there is not a down payment. Check out Low VA Rates for more information. The financial advantages of either program are considerable, so you may want to check them first.

There's a lot of preparation before you will be financially prepared to purchase a home. The work and time are worth it because it's likely to save you many thousands of dollars.

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