5 Tips That Can Help Lower Your Homeowners Insurance Costs

insurance (Photo credit: Alan Cleaver)

It's that time of year when my homeowners insurance needs to be renewed. Going through Money Magazine I found a great check list of ways to save money on your homeowners insurance. My insurance went up this year 20%, quite a leap. I'm glad to have it because it is hard to get insurance in South Florida with all the worry over hurricanes. 

It's so bad many companies have bailed out of the state or are just refusing to write new policies. It was back after Hurricane Andrew when I had State Farm insurance. Just four years after, I missed a premium and they dropped me. They would not take me back even though I had my car insurance with them. Also multiple vehicles and equipment insured with them under my company. They had no loyalty to me even though I had coverage with them for the last 15 years.

You need to be prepared for anything that can happen to your home. Having fire extinguishers in several locations in your home for fire protection is one way to protect yourself. Having an alarm with fire and smoke sensors that can automatically call for help when a fire starts it will also help lower your insurance premium. If you are not sure how to get one of these home safety tools, you can go over to this site and learn more.

Choosing Homeowners Insurance, just like all business decisions, comes down to dollars and cents. So for you and me, we must also do what's right for us. Here are 5 tips to help in your adventure in purchasing your homeowners insurance.

A Homes History Matters.

If your shopping for a new home it may seem unfair but claims associated with the property before you by it can result in your paying more than you would otherwise. Certain locations may be more prone to certain kind of claims.

To get past info on claims ask for a copy of the homes CLUE (Comprehensive Loss Underwriting Exchange) report. this will show all past claims. The homes past history of claims will impact all future insurance rates. If you like the house and purchase it you will be stuck with it's history. This could work in your favor because if the report is negative you could negotiate a lower price for the home.

Don't File Small Claims, It Can Cost You Money.

Go with the highest deductible you can afford and use the savings for all minor repairs. If you file a claim for every broken window or leaky pipe you can drive up your premiums 10 to 15 percent. Insurance agents say even just inquiring about a claim can raise red flags. Increasing you deductible to $1000 or more you can substantially save you money on your premium. Check with your insurance agent and get a quote of insurance with higher deductibles. It could save you money

A Bad Reputation Can Cost You Higher Premiums.

When insurance agents give you an insurance quote they tap into the Comprehensive Loss Underwriters Exchange to see your relationship with past insurance companies. They want to see your history of past claims. To many claims raises a red flag and may increase your premiums.

You can check your insurance report for errors at Choicetrust.com, it's free if you have been denied coverage, otherwise it costs $19.95.

You May Have to Much Coverage.

You may have an inflation-protection clause in your policy. This automatically increases your premium with inflation rising. This adjustment may be erroneous. Switch it off and keep an eye on your home value yourself. Sometimes the costs of replacement could be less than when you originally purchased the policy. You could of paid a premium for your home, way above the actual replacement value. Check on your actual replacement cost and lower your premium.

Loyalty is Overrated.

Insurance companies that are associated with banks may be using you to make up for losses in the banking part of the company. Remember insurers are still competing for your business. You may be able to get a better deal as a new policy holder than as a existing one. When it's time to renew check Insweb.com and Netquote.com to see if you can get a better deal. Try to bundle it with your car insurance company, you may get a premium cut of 5% to 15%.

How To Invest In a Secular Bear Market

Bull and bear in front of the Frankfurt Stock Exchange (Photo credit: Wikipedia)

Our guest post is by Tony he invests in stocks, commodities, and currencies and blogs at A Young Investor. 


Before we begin, let's define what a secular bear market is. A secular bear market is a market in which, after more than a decade, is essentially flat. For example, stocks experienced a secular bear market from 1905 - 1921 (17 years), 1966-1981 (16 years), and from 2000 - present (13 years so far). So how does one invest in a secular bear market? Many of the strategies that work in secular bull markets (prolonged bull markets e.g. 1981-2000) don't work in secular bear markets.

Buy & Hold

Buy and hold is popular among long term and mom & pop investors. Buy it today, stuff it under your mattress, hold it for 20 years, and voila! You've just made 10% year-over-year! While buy and hold is great if we're in a secular bull market, such a strategy is doomed to fail in secular bear markets. Since the market is flat for a prolonged period of time, your investment will also be flat during those 10-20 years. Even if you were to buy on the dips, you would still only make a meager couple of percents year-over-year. As a result, only short term - medium term investors and traders make money in secular bear markets. But not all short-medium term investors and traders make money in secular bear markets.

Trend Following

Trend followers, investors who follow the trend (buy when the market starts rising and sell when the market starts falling) perform extremely poorly during secular bear markets. The whole idea behind trend following is that since one cannot predict which way the market will go, it's better to let the market start moving in one direction and then ride the wave. Such a strategy works well in secular bull markets when trends are long and obvious. However, this strategy is not suitable for secular bear markets because neither are the trends obvious nor are they long. Secular bear markets are characterized by short, choppy market movements, which is why trend followers get washed out very easily. E.g. they buy when the market rises, then the market falls, they sell, then the market rises, they buy..... As you can see, trend followers in secular bear markets die by the proverbal "death by a thousands cuts". So how can an investor generate decent returns in a secular bear market? Easy

Contrarian Investing

Contrarian investors (the polar opposite of trend followers) make the most money in secular bear markets. Here's how they do it.

1. Identify the long term cycle. Is it a secular bear or a bull? This is easy to identify, because secular bear cycles usually last 15 years and secular bull cycles usually last 17 years.
2. Identify the line of resistance. In a secular bear market, the line of resistance (the price that the markets won't exceed until the secular bear market is over) is usually the market peak at the beginning of the secular bear market.
3. Whenever market sentiment reaches an extreme (based on a historical perspective) and prices fall extremely fast, it's time to buy. Think of market extremity like an elastic band - the more you stretch it to one side, the more it will rebound towards the other. Buy and hold until the market reaches the line of resistance stated in Step #2.
4. Repeat the above steps until the secular bear market is over. Note: once the secular bull market resumes, continue with your previous buy & hold or trend following strategy.

Check out Tony's great post on The Economy & The Market Are Falling Apart – Warren Buffett.

Top Tips to Buying an Investment Property to Improve and Sell for Profit

Property market (Photo credit: Alan Cleaver)

There are a number of ways to invest in property. You could purchase a buy-to-let in an up-and-coming area, rent it out to cover the mortgage while its value increases and then sell it on for a profit. Alternatively, you could buy a property off-plan and then sell it at its increased market value when it’s completed. Or, if you’re ready for a project and have the time, energy and ability to cope with stress, you could buy a property that needs work but has bags of potential and sell it for a substantial profit. This method of property investment is risky and requires a lot more involvement than simply purchasing a house or apartment but, if planned and executed well, you could be rewarded for your efforts with a hefty return on your investment. Here are our top tips to finding and buying that perfect development property so that you can start making money!

Go to a property auction

Many rundown homes are sold at auction so it’s a great place to snap up that perfect development property. Plus, buying at auction avoids the lengthy property purchase procedures, which can be costly both in terms of time and if it falls through at the last minute. When that hammer falls, the property is yours. To find out when an auction is occurring, speak to a local estate agent or check the property pages of local newspapers.

View a potential property first - and do your research

Whether you’re buying through an agent or at auction, it is essential to view the property first and thoroughly examine it. Consider taking a builder, architect or surveyor with you to figure out just what will need doing, how much it will cost, and how much you could possibly make. Using software such as the Cordell Estimator V5 can help you estimate total project costs. If you decide to bid, research the asking prices of properties on the market in a similar condition so you have an idea how much it’s worth.

Check the legalities

There are certain legalities which could affect the value of the property and what work you’re permitted to carry out. For example, if the building is listed there are a number of constraints on what changes you can make.

Making financial arrangements

If you’re buying at auction, you generally need a 10% deposit to be paid on the day, with a grace period of 28 days to come up with the remaining funds. Whatever you do, don’t buy a property at auction without having secured a mortgage if you need one. If you can’t find the rest of the money not only will you lose the property but you’ll also forfeit the deposit you’ve handed over.

Securing a property

If buying through an agent, the process should be familiar to you. Buying at auction is a different kettle of fish. It can be daunting but just remember not to go over the figure you have in your head from your research or you’ll risk placing yourself in financial difficulties. If you’ve done your homework and keep your nerve, you’ll hopefully emerge with an investment property with plenty of potential!

From-Home Workers Demand More Virtual Office Spaces in Sydney

BAW's Home Office (Photo credit: bayareabaw)

If there’s any industry in the urban Sydney area that has seen tremendous growth in the last few months, it’s the virtual office industry. After all, this only makes sense, since business is always booming within the heart of Sydney, but it is only recently that much of it has been based out of virtual offices. The huge majority of companies still run out of traditional offices, of course, but virtual offices are creeping up through the ranks and gradually increasing in percentage.

From-home workers such as freelancers, startup owners, and other entrepreneurs have started to use virtual offices more and more, almost more frequently than the available amount of spaces can afford. More virtual office spaces are being created every day by the providers, and yet there never seems to be enough for the clients that need them. This demand is good for the virtual office business, of course, and is allowing them to make more improvements and advances.

This business sector has taken off tremendously due in part to this advent of new improvements within many virtual office setups and the continued cataloging and availability of these offices around the Sydney area. There hasn’t been much of a lack when it comes to virtual offices in Sydney, but now more than ever there are more users wanting their own virtual offices, and therefore more must become available.

On the topic of virtual offices in Sydney, a spokesperson from a said: “The valuable service that is made available to just about anyone through virtual offices has to be made even more widespread and accessible. It would be a huge waste if all those people who want their own virtual office setup were turned down any longer due to insufficient options. That’s why we’re trying to expand our business and make those offices available in some of the further areas of Sydney.”

Sydney’s economic systems and business environment can certainly take more virtual offices, as it’s a city that continues to develop and grow every year. There’s constantly more being done to stimulate the Sydney economy and promote business development in every area of the city. Virtual office companies are just working to match the demand and the opportunities.

And entrepreneurs and freelancers are jumping to take advantage of those new options. “I can finally set up an office I can afford,” said one freelancer, “and still be able to get things done around the home. I don’t need much as far as an office setup goes, really just somewhere to take clients so that they know I’m a professional business person. My virtual office allows me to meet with them, take their calls, and receive mail from them at an official office location, and they never even have to realize that I work from home at all.”

That’s just the review of one of the many clients. Others when questioned have said the same things, claiming that the virtual office setups help them to do more serious business and work in a more official capacity. There are many different purposes that virtual offices are used for, but the numbers show that a huge percentage of them are entrepreneurs just starting out and freelancers needing a professional business front.

The Central Business District of Sydney is the main location where virtual offices are now offered for rent, but in all the surrounding areas there have been new virtual offices opened and an increased amount of office space available. Supply is sometimes short due to the demand being so large in areas like Parramatta, Chatswood, and Penrith, but in the very near surrounding areas the demand is smaller, the prices are cheaper, and there are many more options.

This is a guest post by financial writer Paul Groberts.

Powerful Ways Private Health Insurance Can Save You Money

 (Image credit: Getty Images via @daylife)

Looking for a way to balance your budget and save money on your health insurance cover?  The cost of health care is increasing every year and a lot of people do not know about all the options available for saving money when it comes to their health care. To start the ball rolling, there are several things that you are required to do, and specific information you need to be aware of. Taking the right action will help to make sure that you and your family will get the right benefits and payments.

Some of the benefits of having private health cover include:

• You have the ability to be treated by the doctor of your choice. 
• You can expect less time waiting for elective surgery. 
• You will be in control of when your treatment takes place and where.
• Government funds are freed up as the strain on the public hospital system is lessened and hospitals can be upgraded
• You can have access to services that are not listed under the Medicare system like alternative therapies, chiropractic, and dietary advice to name a few.

There is a good deal of federal government initiatives all set up to encourage more people to take out private health insurance. In short, these can help you to bring down the costs of your private health insurance.  What's more, in certain circumstances, if you choose not to take out hospital cover, you may be required to pay an additional surcharge during tax time. Government initiatives you may qualify for include:

1.  Receiving a 30 percent Private Health Insurance Rebate (source – Businessweek)

2.  Lifetime Health Cover

3.  Medicare Levy Surcharge

Why the 30 Percent Rebate Saves You Money

Now a lot of people consider private health insurance as something only the wealthy can afford, with the 30 percent rebate in place, more people are finding it affordable.  Although premiums do rise because of inflation and other factors, the 30 percent rebate has made cover so much more affordable.  The premiums for private health funds vary based on the actual cost of health care and the kind of cover you need.

How the Medicare Levy Surcharge Works

The Medicare levy is 1.5 percent of a taxpayer’s income and is used to fund the Medicare System.  It is assessed to taxpayers who are without private hospital cover and fall into a certain income bracket.  The Medicare levy surcharge is 1 percent of taxable income and imposed on singles, couples, and families whose income exceeds the threshold and who don’t have the right amount of hospital insurance.

The easiest way to save money and avoid the surcharge altogether is to have a hospital cover policy that has been approved.  This hospital cover policy must be set up through a health insurer that is legally registered with $500 or less per year for single polices or $1,000 per year for couples and families, or just a low front-end deductible.

The Purpose of Lifetime Health Cover

Lifetime Health Cover applies to all residents born after 1 July 1934, and while not all funds offer such policies, you are likely to find one suitable for you. It sets your premium rating for life when you first take out private health insurance hospital cover. The sooner you take out hospital cover the better. If you do not have hospital cover by the 1st of July after your 31st birthday and instead wait to take out hospital cover later on in life, you will pay a 2% loading on top of your premium for every year you are aged over 30.  After loading Lifetime Health Cover onto your private hospital insurance continually for 10 years, the loading will be removed as long as you keep your hospital cover.

This is a guest post by financial writer Paul Groberts. 

How to Choose a Franchise Opportunity

(Photo credit: betsyweber)Starting a business from scratch sometimes can prove to be very difficult. You may be new to the business world and you may not have a clue where to start. Many people skip the whole process and look for a franchise to buy into. They feel that the extra hand holding and developed ideas can be a short cut to success. Jumping on the already established business model of an existing chain will get them where they want to be in a shorter period of time. 

When starting a new business from scratch or going the Franchises route the steps are some what similar.

1. There are many different franchise opportunities and with each there are different criteria and financial requirements. You need to pick a franchise that you can afford. Be sure to obtain a complete list of all franchise fees, taxes, licenses, payroll and employee benefits, for at least one year. Either have all necessary cash or financing ready to pay expenses for the first year because when becoming established, you may not make much income to pay all expense. Having a budget for the first year and seeking financial and accounting help in advance will help guarantee success.

2. Pick a franchise that matches your likes and goals. The first years will be difficult, having a franchise business that you enjoy will help you get through the tough times. When you are in a franchise that you do not particularly like but pick for the financial reward and it starts to have problems you may not be so motivated to see the process through.

3. Have marketing research done before putting any money down on a franchise. See if the area will support the business you are starting. Do you have the population and need for the franchise you are starting. Does the franchise have an appeal and provide something needed in the area? 

4. Visit other franchises owners. Talk to people who have already taken the steps you are about to take. Ask them about any possible problems that may come up. Ask them about the mistakes they made and what they learned from them. Even if you have to travel, this one tip is the most important because the people you talk to will help you make the final decision in pursuing this franchise business. Making this connection sets up a future friend/contact that you may later need for help or advice.

5. Review nationwide ratings on the franchise. The International Franchise Association is a trusted site for quality ratings on all franchise opportunities. Get as much information as possible about the franchiser's history, number of franchisees, support provided and the skills needed to run your franchise business using the franchiser's tools and training.

6. Compare different franchises in the business you would like to go in. Compare start up costs, expense and income information from more than one franchise in the niche you want to pursue. Check for different contingency's in the franchise disclosure documents. Find out what the procedures are for the different problems or circumstances the business may face.

Overall, go slow in the purchase of the franchise. Take all the time you need for full disclosure and planning.