Winter Plumbing Advice From Professional Boston Plumbers

Our plumbing systems are basically composed of pipes, fittings and fixtures. These components of plumbing systems are greatly affected by temperature fluctuations. PVC pipes and metal pipes expand in heat and contract in low temperatures. Unfortunately, the case is not the same for the water running in the pipes. Water has irregular contraction and expansion. This is the most disturbing property of water that causes disturbance in our plumbing during the winters. For business premises and home owners in regions with harsh cold winters, it is important to take the necessary steps to prepare the plumbing systems for winter. These measures from Boston plumbers will help every home owner and business premises to save on the inconvenience of damaged property and costs incurred in repairs in winter.

Adding anti-freeze into your home drains. When water freezes in your drains, it will act as an obstruction; first it will cut off your water supply, and then it could expand at different points in the pipe resulting in inconvenient pipe cracks or bursts. Adding small amounts of antifreeze to your drains will prevent the water from freezing in the pipes. Carefully read the instructions on the antifreeze container and adhere to the guidelines religiously. Consult professional Boston plumbers before adding the anti-freeze into your drains.

Insulating your home and commercial plumbing system is essential. Insulations act as protective layer for your pipes and tanks. It does not prevent freezing, it only ensures there is minimal heat loss from the water in you tanks and pipes, thus slowing down the process of freezing the water in your pipes. First, keep the pipes dry. Check for leaks and probable leaking spots and repair and dry them. Attach foam insulations at points more susceptible to freezing. Insulate and heat the drain lines in crawl spaces and basements.

Use heater tapes, heat lamps. Warm/ heater tapes can be wrapped around the pipes at different points. Most heater tapes are wrapped between the pipes and the insulating material. They have an inbuilt thermostat and are powered by electricity. Read and stick to manufacturer’s instructions to have successful results when using the warm tapes. Heat lamps are used to warm plumbing areas with a p-trap or the tightly curled pipes such as under sinks and behind toilets.

Install a hot water recirculation valve. Professional Boston plumbers install this valve in higher parts of your plumbing system. It operates on the principal of convectional currents. Hot water is lighter that cold water, therefore, when water is heated at the higher points of the system it is displaced to the lower points and cold water rises. This is what forms the recirculation of the water supply system. Unlike the heat tape and heat lamp this valve does not require the use of electricity. It is efficient as it prevent solidification of water throughout the system, even in hard to reach points of your plumbing. More info http://www.angieslist.com/companylist/boston/plumbing.htm

If parts of your pipes are already frozen, thaw them by use of hot water bottles. Commercial pipes should be attended to by a professional plumber Milton expert. Thawing pipes can be a tricky affair. If the heat is too much at one point, it could compromise the pipes’ structure and result in leakage. In extreme cases a pipe may burst. For domestic pipes, you can use low voltage hair dryer or blow dryers to plumbing fittings. Avoid using direct heat or open flames to thaw pipes. Gas pipes exposed to naked flames can be disastrous. After thawing pipes, ensure they are not exposed to any wetness or moving air.

Other measures to be taken in these harsh weather conditions include; ensuring your hose pipes are disconnected from the taps. Water in the pipe can freeze and lead back into the taps causing the water in the tap to also freeze. If electricity is unavailable, let the faucets run on a faster drip to void freezing. Also consider fitting an elastomer in your pipes. An elastomer takes up the expansion of frozen water on itself; to prevent your pipes from bursting.

In summary, if you plan on being away from home during the winter, professional Boston plumbers advice that you take the necessary measures to protect your plumbing system from being damaged.  To prevent ruptures and bursts first shut of the main water supply. Secondly, turn on all faucets to drain all the pipes of water and pressure. Also drain and disconnect all hose pipes, water supply to the machining machine and dish washer.

Investing Demystified: A Layman’s Guide To Mutual Funds And Stock Market

Most people are often awed by successful investors. “They were just lucky!” Most people quip. Luck is, like Napoleon put it, is made. These people made their own luck. There are a lot of reasons why they had this successful investment and blind luck isn’t part of it. A lot of learning and work went into them building great portfolios. That is why it is absolutely vital for those planning to emulate the greats of the investment world, like Warren Buffet and George Soros, they be willing to put in the hours. The road to being an investor is a long and arduous one.

When confronted with the amount of work that lays ahead of them, most people shrink from doing it. Some want to jump right into the deep end without finding a level of how deep the water really is from the shallow end of the pool. In short, they want to skip the basics and get right to fame and fortune. However, you can’t get from point A to Z without going through the rest of the alphabets. In this case, you can’t get to being a master investor without being a novice and not knowing the basics. Below are some of the basics that you need to know about the various investment vehicles.

1. Stock Market

We have seen them in their power suits, commanding every room they walk in. They have an air about them that simply radiates infallibility and invincibility. Stock brokers have been described as many things and have been shown in Hollywood blockbusters like ‘Wall Street’ and ‘The Wolf of Wall Street’. You might think that the life that these people live is out of reach for you and that you cannot play the market. Well, you are wrong. Thanks to the internet, you can.

Before the dawn of the internet, trades were done using ticker tape. Now, people can trade from their homes in real time.

The stock remains the darling of a lot of people despite the various setbacks it has experienced over the years_ the economic crash of 2008 being the most recent.

If you intend to play the stock market, then you should first know how it operates. After figuring out that, you should do your research about the stocks in order to choose the one that will give you value for your investment. Never make the mistake of choosing a stock that is widely focused on the media. Chances that if people are watching the news, and most people do, they will react the same way to the news. For you to be a savvy investor, you must sell when the market is overbought and buy when market is oversold because people often trade the news without other tools.

Finally, you should stay focussed when trading the stock market. The prospect of new investments is just too alluring that you will forget about the others that you had in place. Critical decisions must be made and you must keep your head in the game.

2. Mutual funds

‘There is safety in numbers’ is the premise that guides this form of investment. The way mutual funds work is simple: people pool their funds and the pool is invested in derivatives, an asset whose value is fluctuates depending on the market conditions. Mutual funds are managed by fund managers who are tasked with making the crucial investment decisions regarding the mutual fund. A fee will be charged by the fund manager for the running of the fund. There are three types of mutual funds: open-ended, unit trusts and close ended.

Open-ended funds are funds in which value gained is calculated daily after trading and value gained is geared towards getting more shares for the clients. Close-ended fund are funds that are traded daily and no new shares are added to the client accounts. Unit trusts are investments in which shares are given to clients. Open-ended and close-ended mutual funds are run by a fund manager, whereas a unit trust is run by the individual.

When choosing a mutual fund, just like choosing stocks, you must do thorough research. It is important that you delve deeper than most people because most people tend to see the surface and take the information they get at face value. It is important that you look into the mutual fund’s history and the rate of returns. You should also examine the contents of the contract. You don’t want to be blindsided by new information. Go over it yourself several times and have a lawyer examine the contract so that he can ensure that your interests are protected.

The Importance Of Insurance In Your Day To Day

Risk is all around us. Try as we might, we can avoid events that could lead to loss. The best that we can do is try to prevent the loss from occurring and that is not a clear safeguard because events have a way of getting out of hand.

Insurance plays a huge part in our lives. Most people, if given an option, would not opt to have insurance partly because of the premiums involve. Now, the premiums that we pay are contingent on the agreement on the risk we face. An actuary will calculate the premiums you have to pay based on your income and the likelihood of the event happening.

1. Great for offering safety and security

When you are insured, there is greater incentive for you stick to the essential parts of safety. This means that you have to take greater care because money is no substitute for your well-being and life.

2. Offers essential peace of mind

Ever wondered what the sequence for fear of loss are. For starters, there is always a looming cloud of doubt and trepidation about an event happening. There is just this feeling that you can’t shake and you will be worried about the subsequent steps that you will have to take to repair or replace the item that you are worried about. This looming feeling tend to permeate all other arenas of life and manifests itself in constant worry. This constant worry means that you won’t concentrate on the essential things like work and those areas won’t be as productive as envisioned. What insurance does, is it takes off this burden of worry from you and you can focus on other things.

3. Insurance protects mortgaged property

In the event that you took up a mortgage and then unfortunately passed on, the bank would have cause to foreclose your house. After all, you cannot meet the mortgage payments yourself and hence they have to find a way of recouping the money they gave you. Where does this leave your family? Out in the cold! Most families undergo this tremendous hardship that can be averted by simply having an insurance policy that covers the home mortgage payments in the event that you as the sole person responsible for paying the mortgage should pass on. Given that there are a variety of policies out there, it is important that you talk with insurance agents so that you can have more perspective on the packages that are out there. In doing so, you are rest assured that you will be getting your money’s worth in the end.

4. Eliminates dependency

Economic dependency is terrible especially when the sole provider is has passed on. You were probably accustomed to a certain lifestyle and there is a very huge shift afoot. The beauty about having an insurance policy in your arsenal is that you are assured that the beneficiaries you have in the policy will not endure a discernible change in their lifestyle. In life, there are very many uncertainties; some unexpected events may come and shape the rest of our lives. How the people in your life come out of these unfortunate events is entirely up to what you do today. It is therefore, very prudent that you choose a life insurance policy that reflects the kind of life you would want your beneficiaries to lead after you are gone.

5. Encourages saving

In a world that is hell bent on squeezing every drop of money from us, savings are very hard to make. There is always some that demands attention that can only be satiated with money. With insurance, you are compelled to save whether you like it or not. For instance, the premiums you churn out in a month can be totalled to come up with a hefty amount of money that you can take out before the expiry of the policy. There are some insurance policies that you cannot cash out easily like a life insurance policy or fixed one where you have to wait for a certain period to lapse before you can make a claim. In essence, an insurance policy is like a ‘bank account’ of sorts that you simply cannot withdraw money from as you please.

6. Profitable investments

Insurance is a great avenue for earning interest and also a low risk investment. In some countries like India, insurance incurs little or no income tax. This means that it is a great way of encouraging investments in business through them being an avenue for capital formation.

Understanding Offshore Investments

Most people tend to think of offshore investment as being some sort of clandestine way of disguising your income so that you cannot pay your taxes. While to some degree, the taxes you pay on investment in tax-haven are taxed less or even not taxed, offshore investment is more than that. For starters, offshore investment refers to the investment type that takes place outside the shores of your resident country.

There are different categories of offshore investments. The most commonly talked about are Trusts, Residential Offshore Company, International Business and Protection Cell Company. This article explores others that are not so talked about and they are put into context.

This article also explores the different motivations that drive people to go for these investments.

Knowing the merits and demerits.

Below are the key merits and demerits:

The Merits

Confidentiality

Over the last few years, legislation has forced many banks to be transparent in the way they do their businesses. This means that when they are compelled by a court order to disclose your information they have to comply.

However, in most offshore investments, discretion and confidentiality are guaranteed.

Tax-free nature of the companies

In a bid to attract more investments to their countries, there are some that create a favourable tax environment. Small countries like Mauritius and Seychelles have great tax legislation that is geared towards bringing in more outside investment to their country since their populations are small and they need to grow their income per capita.

The uses and types of offshore investments

Below are the various types of offshore investments that are out there.

1. Trading companies

When a country wants to import goods from a different company and they want to keep the cost of importation very low, they will use one of those tax havens to set up company to accomplish this purpose. As an individual, one can form a trading company in that given country so as to deal with a variety of investments as well so as to diversify their portfolios.

2. Shipping companies

One of the tools that shipping companies use to isolate the liabilities of their crafts is by setting up a company for every ship. This practice is very common if one wants to minimize the exposure. Also, one pays very little in the way of taxes for ships if the company is listed in the tax haven.

3. Professional services

Today, most companies outsource a lot of their services to these tax havens. Individuals benefit a lot from this arrangement in the sense that they get fees for the services they render virtually tax free.

4. Investment companies

A lot of mutual funds are owned by offshore companies. The primary reason for this is precisely the tax reduction environment in the tax havens that they base their countries. Now, mutual funds are known for spreading the risk so as to minimize chances of loss in the environment.

Even when it comes time to fold, it easy for the owners of the mutual fund to sell the company itself rather than the asset itself.

5. Property owning companies

Most people intending to own property in a country will set up companies to achieve this property. And when it comes time to fold, it is easy and less costly to them to simply sell the company than the property itself. The cost comes about in the sense there are one doesn’t get taxed for the property but only for the company which is cheaper.

6. Intellectual property companies

Most foundations that are responsible for all forms of copyrights create offshore companies so as to safeguard their claims to intellectual property that is under their purview.

7. Dot com companies

Most people set up companies offshore so that they can complete software project. Setting up the company ensure that fundraising is easier for all the parties involved.

8. Asset protection companies

In this day and age, businesses should anticipate being sued at least once every three years. If your income ranges from USD 100,000 and above, it is important that you set up an asset protection company in an offshore jurisdiction. These offshore jurisdictions require for one to pay that given lawsuit a lawyer must be involved hence, it enables one to keep people with frivolous claims at bay.

At the end of the day, you should set the company in the form of a trust so as to minimize your chances of loss during paying of a claim.

Demystifying The Types Of Loans Out There

The loan facilities in banks has evolved a lot in the past two decades. There are very many new packages out there. This article seeks to provide the reader with a better understanding of the various loans facilities that are out there so that they can make informed decisions of which loan facilities suit them.

Bad Credit Personal Loan

When you have terrible credit and want to apply for a loan facility, some banks will not touch you or look at your application. This state of affairs is very disconcerting considering that there are some situations that you cannot simply avoid having to borrow money. However, when you have a bad credit personal loan, you have reprieve and can borrow money for your use. The terms and conditions tend to be stricter than conventional loans and will make it harder to borrow in the future.

Bridging Loan

Just as the name ‘bridging’ suggests, this type loan is used to cover a payment for an investment. They are used in the purchase of property; when you want to sell your house and want to buy a new one right away, a bridging loan will enable you get that house you want before the other one is sold. Think of it as a loan that allows you to pay for something first and you can pay it back as soon as possible. These types of loans while convenient, have very high interest rates and should be sought after with discretion.

Business Loan

This a loan that is provided for business to finance various business transactions like purchasing of inventory, payment of suppliers, expansion and so on. They have very competitive interest rates to boot. They are secured meaning that you have to put an asset as collateral. As the loaner, you have to put up the cost of legal fees and valuations.

Car Loan

These types of loans are a form of lease agreements. They are arranged by car dealerships. Most people think of leasing a car as ownership and therein lies a problem. They think that since they drove the car out of the lot they own it. However, as long as you keep making car payments, the dealership owns your car. If you don’t keep up the payments, the car gets repossessed. Ownership of the car is transferred to you upon completion of the payments for the car. When you are considering this deal, it is important that you check out the fine print before you sign it; you will avoid getting stuck with a terrible deal in the long run that will be detrimental to your pocket.

Cash Loan

These are loans that one can apply for before they are paid. Sometimes, there will be necessary expenses that have to be addressed in time before you can get paid. A cash loan will help mitigate these expenses and have to be paid on the next payday.

For one to access these loans, they must provide proof that they are salaried and can pay the loans on time.

Debt Consolidation Loan

If you would like a fresh start on your debt, then this type of loan will help you accomplish just that. The beauty of taking up this particular is that it has a very low interest.

Most people take up this particular loan in the hope that it will give them one big target to focus. It gets very tiring keeping up with payments on many fronts; at least when you have one big target to focus on, you prepare yourself accordingly.

Home Loan

Most people buy homes in the hope that it will be a great investment in future. This type of loan enables owners to tap into the value of their home. They can use the money they get from this loan to accomplish any goal they desire; whether it is an overdue vacation or settling of credit card debt.

You can find out more about this type of loan from your favourite lending institution.

Home Improvement Loan

Ever wondered how you would finance a remodel on your house? This type of loan enables you just to do that.

It is a very low interest loan that can be paid for the duration of up to 25 years.

Re-mortgage loan

This type of loan enables one to switch their mortgage to lenders with favourable rates and enables one to get cash that they can use to finance other there.

These are just a tip of the iceberg. If you would more information on the types of loans out there, please get in touch with a favourable lenders.

Insurance For Your Business-Important Tidbits You Should Be Familiar With

When you are considering getting insurance, it is important that you be aware of the packages that are out there. Most people feel compelled to get the first package that is out there. More often than not, it is a package that they don’t need. In the end, they waste money on premiums that could have been best channelled elsewhere.

This article explores the various types of insurance packages out that you should consider. It is geared towards ensuring that you make an informed decision about the package.

LIABILITY INSURANCE

This is perhaps the most important package out there. In a nutshell, this type of package provides protection from potential losses arising from injury or damage to others or their property.

Over the last couple of decades, there have been multiple lawsuits and settlements that have been settled by this type of insurance. Hence, its importance cannot be reiterated enough.

There are two types of liability insurance cover; the general and personal liability. The general liability cover extends to other people and their property and it is reserved for businesses; it is geared towards protection against loss from your action in your business. Person liability covers protection against loss arising from your actions.

It is imperative that you be clear on the type of liability insurance that is out there to avoid conflicts when events that lead to loss occur.

KEY PERSON INSURANCE

When you operate a sole proprietorship or a partnership, this type of insurance is indispensable. It is geared to mitigate against the loss of key personnel in your business, through illness or accident.

In these types of business, the well-being of the personnel is important as it has an effect on the business itself; when that key individual is missing, the business will more or less
likely experience a loss.

DISABILITY INSURANCE

As key personnel in your business, you must be insured as well. Remember: when you are out on a lay-off, your business will suffer. This form of insurance is important, even when you think that key person insurance will suffice. When you take up this package, it is important that you be clear on the terms of and definition of disability, the time the coverage begins, when it ends and inflation costs. Remember: with insurance, you should be clear on the details of the coverage to be on the safe side.

FIRE INSURANCE

It is absolutely vital that you have this coverage in your business. Above all, it is crucial that you know what is and is not covered in the fire insurance policy. Remember: it covers the loss of the property but not loss of business until the facility is back on its feet.

Finally, it important that you review your insurance cover from time to time to ensure that it meets your needs.

AUTOMOBILE INSURANCE

It is still important especially if you have a fleet of cars in your business.

WORKER’S COMPENSATION INSURANCE

It is important that you have your workers covered by this type of insurance. In fact, it is a requirement that you do this.

In order to lower the cost of the premiums that are paid in this, you should classify your employees.

BUSINESS INTERRUPTION INSURANCE

When you have property damage, it will take time for you to return to full strength and it will mean that you will lose business in this hiatus. This form of insurance ensures that you don’t suffer the adverse effects of this hiatus.

CREDIT INSURANCE

It is important that you have this in the event that you lose goods in an unexplained manner. Consult your agent for more information on this type of coverage.

BURGLARY/ROBBERY/THEFT INSURANCE

Always ensure that the business assets are covered against this.

RENT INSURANCE

It covers your business should a loss happen where you rent your premises.

DISABILITY INSURANCE

This is very important in the event that you are unable to work. It is important that when you are considering the package, you be clear on when the benefits kick and other things as well.

When you considering it is important that you do some soul searching first so that you can get value for the package that you intend to invest in.

Always consider if you can afford the risk in question. Also consider if you can afford the disruption in your business and whether or not you should revise the policy so that it meets your needs. These essential considerations and these packages will go a long way in giving you peace of mind that you are making an informed decision.

Mistakes That Freshmen Should Avoid When Choosing An Account

Saving is critical to securing one’s financial future. Most students have this air of invincibility about them especially when it comes to money. They tend to think that it will never run out and the waste it on frivolous things. Usually, college has a way of bringing out the ‘party animal’ in all of us. It is no secret that college life can get very unbearable when you don’t have money.

Luckily enough, college accords us the opportunity to replenish funds by way of various odd jobs. Some might not be up to the challenge of working to replenish their accounts; that is okay. As long as you have enough funds in your account, they can last for the duration of the semester.

In essence, having the right bank account type to save your money. It is important that you go about selecting the bank account in a meticulous manner. Having the wrong type of bank account is very detrimental to your financial future. Below are the critical mistakes that you should avoid when choosing a bank account for students.

1. Choosing a bank account with limited branches and those that are far away

Most of the banks out there have great marketing strategies. They have a way of making you feel emotionally invested with the situation. Just by their pitch, you want to entrust them to handle your money. However, you are blinded by the fact that the bank you have selected has very limited branches and depositing and withdrawing money will be problematic for you.

It is therefore important that when you are looking for a bank to handle your funds, you should ensure that the bank has branches that are not only convenient for you but also convenient for the folks. They could deposit money into your account from time to time and they should do so with less hassle.

2. Don’t get roped in by those banks that are affiliated with your school

When you are just about to get admitted to college, it is easy for you to get roped into by these banks so that they you can become their member. Most students feel as though they are under the cosh to get a bank that is recommended by the learning institution that they will be part of. You should know right away that you are under no obligation to sign with a bank that your school is affiliated with even if they send a debit card to you.

You must evaluate who you are first and what needs you have. Then you should evaluate various banking options that appeal to you. In essence you should ensure that the bank account that you choose a bank account package that matches your needs. As a student, your needs will be many: you have to buy equipment and books to read.

3. Not knowing the charges they will incur by becoming a member of a particular bank

It is important that you stay aware of the charges that you are likely to incur when you become a member of a bank. Most students choose accounts blindly and they only later find out that they have to part with a specific amount of money at the end of the month just to keep the account running.

It is important that you be wary of the charges that you are likely to get charged so that you can decide whether the bank account you have chosen is the right fit for you.

4. Taking due diligence for granted

Most of the time students are in a hurry and if they need a bank account, they will choose the first bank that they will come across. This is very dangerous considering that some bank accounts are not the right fit with what you are.

It is important that you know fully what you are getting into when you are dealing with a particular financial institution. This knowledge is crucial for decision making.

5. Taking on add-ons to the account that you won’t need

As was mentioned, marketing campaigns are geared towards being very effective at making you trust a brand; in this case a particular bank. Now this bank has packages that are supposed to serve customers. These packages have add-ons that are marketed in a cool way. You should take a step back and consider whether or not you really need these add-ons.

More often than not, these add-ons are useless, but it still important to evaluate whether you really need them and make a final decision about them.

Getting Personal Loans – Essential Information That You Need To Know Before You Get One

In most of our adult lives, few people can get away without borrowing loans to meet one need or another. Getting a loan is not a necessary evil per se, but if it can be helped, it is prudent that you avoid it because of the red tape involved. Sometimes the repayment periods might be too steep to get to and this proves very problematic for people who undergo a sudden change in fortune_ like getting laid off.

When you intend to borrow, you must know what you are getting yourself into. This means that you should be aware of the various products out there and the terms and conditions that come with that product. One of the most popular loan products in the market is the personal loan. Because of its popularity, a lot of people want to get it but don’t know exactly what it is. This is detrimental further down the road when it comes to paying the loan back. This article explores what one needs to know before venturing into a personal loan.

1. Personal loans are unsecured

When you apply for a personal loan, you don’t have to put collateral. Most people often assume that since this is the case, they can default the loan without experiencing any consequences. However, there are consequences that come from defaulting on your loan. For starters, your credit score will take a hit and it will stay in your record for more than 7 years. Another consequence is employing the services of collection agency to take you to court for defaulting the loan.

2. They have fixed amounts

Most people tend to think that all loans will allow one a top up once in a while. However, with personal loans what you apply for is what you get, and you can’t get any more until you finish paying the loan. Therefore, it is important that you use the amount that you get very prudently to avoid coming up short. If you are uncertain about the amount you will get from the bank and whether it can be topped up when you ask, ask the loan officer for more details.

3. They have fixed interest rates

Banks are at liberty to revise interest rates. However, the interest that you pay for personal loans is fixed and at the discretion of the bank. This means that you will consistently pay a fixed amount at the end of the month. The discretion of setting the interest rates from the bank arises from deliberating whether or not you are good for the amount. That is why it is recommended that you get a personal loan from bank that you consistently deposit money into. While the credit report might not feature so much in personal loans, some banks will use it to determine the amount you ought to pay in regard to the interest rates. Therefore, if you are contemplating taking out personal loans the near or far future, it is important that you have your credit in order in order to get a fixed rate.

4. Have fixed repayment periods

This means that personal loans have to be paid by a certain time failure to which you have inadvertently ‘defaulted’ the loan. It should be clear to you from the start that you have this amount of time in which to pay the loan. Even when you ask for the loan, you should be clear on whether or not there are penalties that come with paying the loan early. Some banks have a reputation of penalizing people who settle their loans early. That is why most people will opt to go for personal loans from banks that don’t have these penalties.

5. Can be secured from the bank that you have an account with

It is important that you build up consistency with your bank account. After establishing a credible history, it is very easy for one to get a loan. If the amounts you have been depositing are constantly high and consistent, the bank will provide you with a loan of your choice at a very favourable rate. Most of the time, people will open accounts and hope that everything falls into place when they ask for a loan. However, without proof that you are a consistent depositor, then you are going to get a very raw deal when it comes to the interest rate. Think of it this way; depositing money is an easy way of forging a relationship with your bank.

Disambiguating The Cost Of Passive Investment

Over the last few decades, the investment world has had a major shift. Today, people can trade various securities that include, mutual funded, exchange traded funds and segregated funds. The common thread that these securities have is that they traded as a group rather than as individual investments. Also the risk of investments is reduced because the fund managers tasked with investing in the fund can invest in a variety of products so that you don’t have to.

Nowadays, a new investment trend has come up where people are gravitating more toward passive investments. The primary reason for this it they don’t want to expend too much effort monitoring the progress of the asset. In this regard, they use time as a resource to watch their investment grow.

Where active investments end and passive investments begin

So where exactly do active investments end and passive investments begin? For starters, the common thread with these two investment vehicles is that they all have a manager. In active investments, the manager is monitoring the investment daily and make decisions on whether to buy, hold or sell on the fly. As for passive investments, the manager watches the trend and decides on the direction to go. In this regard, passive investment managers use a benchmark to guide their decision about the investment. They will use various companies against which they benchmark themselves so as to know which direction to take so that they can maximize their returns.

The various cost associated with passive income

As is the case that is common with active income, there are some costs that are associated with making passive income. Below are the main charges that you should expect to find when you operate a passive income account.

1. Management Expense Ratio

This entails the cost of keeping the fund going. It is usually highlighted in terms of percentages. If you have a USD 100,000 investment and the Management Expense Ratio is 0.5 percent, you have to pay USD 500 to keep it going. The MER is used to cater for the costs of labour, advertising and other costs. Most people tend to think of the MER as the Management cost but when you factor in administrative costs, you get the complete MER.

2. Track error

When you invest in a fund, you are investing against a benchmark of a similar fund that the fund is supposed to hit so that it can be termed as consistent. If the benchmark is hit all the time, it would mean that you are paying nothing for the investment, which is not the case most of them. The tracking error basically arises from the difference of the actual performance and the benchmark that is set. While consistency in the tracking error is expected, there tends to be discrepancies arising from the running of the fund.

3. Early redemption costs

These are the penalties that one has to pay when they want to cash out early.

4. Sales loads

Most passive investments doesn’t have these loads because for them to be incurred there has to be a sales person involved. More often they are not involved hence, they are not levied on you. However, they are levied on investments that involve sales people in the mix.

5. Other costs

Below are the miscellaneous costs that arise from operating a passive investment.

a. Account costs and advisory cost

The account costs is the amount you pay to keep your account running. As for the advisory costs, if you are keeping your eye on the asset and consult the manager on what to do next, you have to pay the advisory cost for that consult. It is a fixed rate.

b. Bid/Ask Spread costs and opportunity cost

The spread is the difference between the bid and ask prices in the various transactions, be it selling or buying. When one opts to buy and asset at a fixed price rather the prevailing market conditions that fluctuate, the run the risk of losing the asset or paying more for it later; this is the opportunity costs.

c. Foreign exchange cost

Investments that are held offshore, one has to pay forex costs. These costs are not fixed and depend on the forex rates that are out there. Most transactions are based on the US dollar.

d. Trade fees

When you operate a passive account, you have to pay trade fees for every transaction that is made while it is operated. If you are unclear about the fees from the outset, it gets confusing when charges come to your statement. With trades, they tend to fluctuate and depend on the size of the trades placed.

What You Need To Know When You Apply For A Loan

There is often a truism that banks won’t lend you money when you are desperate for it. They are constantly looking for individuals who can afford their loans and have very stringent vetting processes that are designed to eliminate those that need money desperately. The conditions that you need to fulfil so that you can qualify for a loan tend to vary from bank to bank but the principles are the same across banks.

When you apply for a loan, there are important things that you should know first-hand. These are the critical success factors that make the difference between your loan getting rejected and accepted.

1. The one with the highest credit score gets first priority

Your credit history counts a lot when it comes to borrowing. In a nutshell, it is a breakdown of what you are like handling money. Banks have a lot of respect for people with high credit scores. In fact, when you applying for personal loans, you will get a favourable rate when you have a good credit score.

When you are applying for a loan from a bank, the loan officer will go over the report with a fine tooth comb. They are always on the look-out for those small mistakes that you made in handling a payment. Maybe, you were late in a loan payment or maybe you defaulted a loan but paid back later. Such things will preclude you from getting the loan that you have applied for.

The thing with credit scores is that they last for 7 years and hence care should be taken with them. Small mistakes cost people a lot and with 7-year period that you wait it for it expunged, borrowing money from the bank will be problematic.

2. Some loans are secured and some are unsecured

Different banks have different loan packages. These loan packages are categorized into two major categories: secured and unsecured loans.

Secured loans require one to put up asset of similar or more value than the loan you have applied for as collateral. In the event that you happen to default the loan, the asset will be repossessed by the bank so that they can recover the money you owe them.

Unsecured loans are loans that one doesn’t have to put up an asset as collateral. However, there are a lot of misconceptions surrounding these types of loans. For starters, most people think that since they don’t have collateral attached to them, you can default with no consequences. However, nothing could be further from the truth. In fact, banks will institute various mechanisms that will ensure that they get their due. For example, you will find that the bank will contract a collection agency that will come find an asset that will pay back the amount owed. Alternatively, the collection agency will take you to court and the bank will have legal redress against you. As long as there is evidence that you applied for the loan, these case will turn against you as quickly as possible.

3. To qualify for a loan from a bank you must meet the requirements

As soon as you enter a bank to apply for a loan, you must ask what the requirements. Loan applications are rejected primarily because the individual applying for loan fell short on the requirements.

That is why you should ensure that you understand the essential requirements while applying for the loans. If essential documentation is required, please provide it. Loan officers are very thorough about whom they give money to.

4. Always be truthful in your application

Honesty is demanded a lot when one applies for a loan. There is a lot of temptation to skew the facts in their favour.

Banks invest a lot in confirming the veracity of the information one provides about themselves. They will enlist the services of a PI or do the checks in house.

In the event that you are found to have knowingly misrepresented yourself, then you can be prosecuted for fraud. Therefore, no matter how embarrassing the information you will provide might be, you must provide it nonetheless.

5. Get clear on the interest rate

This is one thing you can’t afford to be vague about. You have to know whether the rate is fixed one or one that can be revised at the discretion of the bank. If it is a fixed one, then you are free and clear. If it is a fluctuating one, you should craft ways of adapting to it.

Weighing In Banking Products: A Newbie’s Guide Bank Accounts

One of the most pervasive advices out there regarding financial freedom and success is the setting up of bank accounts by individuals. If you are to succeed in getting your house in order financially, you need to have the right product. You need to put your money somewhere that you know you can get a great return.

The banking world has changed tremendously over the last decade. Today, there is pervasive use of internet banking to take care of the various transactions that need to be done. Digital currency has flooded the market and promises to dethrone the good old paper money. Banking products are very many.

Therefore, if you are to make any headway in getting the bank account that you deserve, then it is crucial that you get acquainted with the processes of securing an account with your trusted bank.

The first visit and essential questions to ask

Most people will opt out visiting the various banks that are out there in favour of checking out their packages on the internet. One of the things that going to the bank in person accomplishes is that it ensures that you can direct feedback about the various products.

During that initial visit, below are the important questions that need be asked:

1. What is so different about this product from the rest of other products? This line of questions establishes a bassline from which that you can draw various conclusions about the product.

2. As an X (list your occupation) how can this product enable me to secure financial prosperity? Given that there different occupations out there, it is important to establish how the bank account that you intend to buy can enable you achieve the various financial goals you might have.

3. What are the charges to come with this account? There are some accounts that come with standard charges and there are those that don’t have. Most people are not clear on the charges on these accounts from the start and end up paying later for them. Be different. Ensure that you ask about these charges and whether they are fixed or left at the banks discretion.

4. What are the loan facilities that I can access and how soon? Much as most people frown upon getting a loan form a bank, sometimes you are circumstances will compel you to get one. You have to ask what kind of loans and how much you can borrow from the bank. If you intend to get a house in future, the success of your mortgage application will depend on the bank that you ally yourself with. Hence, you should ally yourself with a bank that has a loan facility with favourable interest rates.

Important reviews

You will be required to review the relationship you have with your bank from time to time. This is in response to the changes in the banking environment and your evolving needs as an individual.

Most people will never take a comprehensive review of the situations that they find themselves in regard to their banks. That is why they end up find themselves at a disadvantage. If you are to succeed, in reaching your goals, you have to examine how the relationships that you have in play will enable you reach your financial goals. If the answers you get after this review check all the right boxes, then you should continue with the bank. If you are skittish about responses, then it is time that you change banks and go for the one that is more suited to addressing your needs.

Using symbiosis in bank accounts

It is often recommended that when you are using a bank, you refrain putting your money in one place. The risk of spending it all in one jump is very high and you have to avert it at all costs. Hence, there is a way that you can ensure that you keep your spending in check and it is by ensuring that you have two or more accounts that are linked.

Different account packages address different needs and hence should be used the same. If you have bills to pay, then you can set up an account that will always have money transferred to it automatically so as to address this need. Think of this account as the ‘Bill account’ that is different from your savings account.

Most people will avoid having two or more accounts because they think that they will be hard to manage. However, if you set them on auto-pilot, then you don’t have to keep a close eye on them as such.

Conclusion

Overall, if you intend to open any bank account, you better do your due diligence first just to be safe.

How To Shop For Car Insurance The Right Way

In all countries around the globe, it is imperative that car owners have insurance. It is a punishable offence in law when you are riding a car with no insurance.

Today, there are a lot of options for insurance out there. In fact, there are so many that it is very easy to get lost in the mire of it all. One thing as a car you are supposed to realise is that not all insurance packages are there to represent your interests. Some are purely in it for the money and could care less about you and your future. It is vital that you avoid companies these types of companies purely for your well-being. This article highlights what you need to know to shop for car insurance the right way.

1. Visit your state’s Department of Insurance

Not many people are aware that their state has a Department of Insurance but it is there. This avenue is great for providing you with a list of legit insurance providers for you to choose from. The primary reason is that for any company to be described as legit they must be a member of the state Insurance body. Fake companies are skittish about being found out.

2. Find out which insurance providers that body shops in your area would recommend

There are some companies that are frowned upon by body shops. It is absolutely crucial that you find out what insurance companies that body shops in you are would recommend in order to save time. There are some companies that are a no-go zone for bodywork shops primarily because they delay in making payments hence affecting the shop’s bottom line.

3. Consider working with an insurance agent

Agents are there to make the search for particular services very easy and should be explored in depth if you are to get the most out them. However, not everyone that claims to be an agent will act in your best interest. Therefore, you should ensure that you vet the agent thoroughly before you make a final decision. You should research them and effectiveness before you decide to hire them to find a great package for you. That way you can be assured that you are getting your money’s worth.

4. Do your due diligence on the insurance finance ratings

Some companies make outrageous claims like they have the financial muscle to deliver and when they are put to the test, you find out that they don’t. In order to avoid getting into such kind of drama, it is imperative that you do your due diligence on the company rating before you make a final decision. A great place to start is are the financial records that are posted quarterly, assuming if the company you are interested in is trade publicly. Alternatively, you can enquire from your state’s Department of Insurance about the history of the company and their claims fulfilment rate before you can make a final decision about them.

5. Know what you are looking for in an insurance provider

When you embark on a search for an insurance provider for your car, it is important that you have a clue about what you want in an insurance. For starters, you should have a clear set of values that you would like an insurance provider to espouse. You will find that more often than not, those that have the values that you are looking for in their company motto will are a great place to start. If there are none, then you should dig a little deeper to find out from other people who have used the service if they have seen the company espouse those values in your checklist. Reviews will come in very hand during this process.

6. Retain your right to sue

There are some insurance providers that look very good in paper and sound great when you talk to them. However, when they are put to the test, you will find that they have put on a façade. When it the time to make a claim comes, they won’t deliver and you end up paying for the bodywork yourself. This can put a very huge dent in your finances and gets very disconcerting when you waived your right to sue the service when you signed the agreement. Therefore, before you sign the agreement for the policy for the car, it is vital that you make it clear that you retain the right to sue in the event of breach of contract. Those that have a reputation of not delivering will be skittish to turn you into their client.

Getting Accounts For Students Simplified

When you are student, the world is basically your oyster. The possibilities are endless. When you have money, then it is time to be really worried. The trend has been since time immemorial to spend money while you have it. After all, it is all going to be spent anyway, right? Why postpone the inevitable?

This type of rationale is what most people carry from college into the working world. However, the world gives them a rude awakening when mounting debt becomes the order of the day. Every day seems like a never ending struggle to keep their head above water, financially speaking.

One of the best ways to keep this from happening is to ensure that kids in school have a savings account in place. This will empower them to stay in control of their financial destiny and keep away from unnecessary spending.

However, the misconceptions around getting students accounts are very pervasive and need to be addressed if any meaningful change is to take place. In this article, the reader will get to understand the intricacies of getting the student account and the pitfalls to avoid along the way.

Choosing a bank affiliated with the school

The trend with colleges in the last few years has been to send bank information along with their acceptance letters. New students often feel pressured to take the accounts offered by the banks affiliated to college. To them, getting an account with this affiliate bank is one of the requirements for admission.

However, the good news is that it is not. If you want to choose a bank account, then it is at your discretion which bank account you choose. If you have specific needs that you want your bank account to address, then all you have to do is just get into contact with various banks and know what they have to offer.

Get a bank that is close to school

While saving is encouraged and wanton spending discouraged, one should choose a bank that is conveniently located. In other words, you should choose a bank that is located within the vicinity of the school to avoid unnecessary hassles when emergencies come up_ emergencies do come up and you might require cash urgently.

Most people choose banks that are far from their school primarily to avoid dipping into their accounts regularly. One problem with this approach is that the tendency to binge and overdo things is there. You will feel aggrieved that you can’t get to your money and at the slightest opportunity, you will go clean out your bank account. If you are to avoid playing out this scenario, it is important that you exercise self-control throughout the process. This skill will help you immensely in keeping spending in check and at the same time extend to other areas as well.

Always check the fees that banks charge on accounts

If you sign any agreement oblivious to the terms and conditions contained therein, then you are in for a rude shock. Some of the agreements that have been drafted by banks are geared to ensuring that you are indebted to them through fees. There are maintenance fees, for example, that will be charged on a monthly basis to keep your account running.

In essence, before you sign any piece of paper, you have to ensure that you read and understand the terms contained in it. Don’t feel pressured to sign it if you don’t understand it; take your time to get the gist of the agreement.

Add-ons: Get what you need and not what you think you should have but won’t use

There are certain account packages that have add-ons that one can use. Examples of these add-ons could be a cheque book or wire transfers that you will never use.

It is important that when you are looking for somewhere to put your money, you settle for what you need. Add-ons cost a lot of money and will strain you a lot especially if you have no extra money coming in to keep them going. Most people will be enticed by these add-ons because they promise a whole rich world out there. Don’t be deceived, it is all a marketing ploy.

Conclusion

Prudent financial management isn’t a one-off event that happens with a snap of the fingers. Instead, it is a process; one step at a time, one stage at time will get you moving to where you need to be quickly and more efficiently.

Demystifying The Concept Of Investing

No matter how you dice it, investment is a huge part of our lives. It is everywhere. In order to maintain financial security, it is vital that you undertake a series of informed choices about which real you invest in.

For savvy investors, money is a tool that can propel them greater riches that they don’t have currently.

Need of Investment

Investment is a multiplier of wealth. When you invest, the principle amount that you invest is supposed to experience some growth. However, investment does take in a vacuum as most people belief. A serious of tough decisions have to be made so that you can value for your money.

A majority of the people are of the view that getting rich is something that takes place like an event. For your investment portfolio to grow so that you can truly be classified as a wealthy individual, it is vital that you let it grow over time. Even people with investments are impatient. In their mind, investments are a race to wealth which is not always the case.

As much as it is about the money, investment is a psychological game. Decision must be made dispassionately and as objectively as possible. Emotional investors crash and burn very quickly.

Important Factors of Investments

Planning for the investment – It is important you sit down and plan for your investment. You have to meticulously for the investment for it to pay off. This plan must take into account the situations in the market. A good understanding of the market conditions must be there and this can only be gained by immersing yourself in reports about the market. It is only then that you should come up with a credible plan of attack for the market.

Invest according to your capability- it is important that you should ensure that you take care to invest only the money you are willing to risk. People make the mistake of thinking that investing all their money will solve their monetary worries. When market goes against them, they will have enjoy some lean months before they can get back on their feet.

There are a variety of investment options out there, explore them – The investment space is full of abundant opportunities. It is very to get lost in them all. Savvy investors F.O.C.U.S (Follow One Course Until Successful).

It is recommended that before you take the plunge in any investment vehicle, you have to consult a financial planner or an investment expert. They will give you perspective on which investment avenues.

Types of Investments

Mutual Funds- In mutual funds, you invest money in a fund that is managed by an investment firm. The money invested by various individuals is invested in derivatives and other investment vehicles.

Commodity Market- Most countries have securities exchanges that offer commodities. Those commodities range from minerals to agricultural products. There you can speculate on the prices of and make a killing when the price you sell them at exceeds the price you bought it for.

The stock Market- It is where people trade the world over to earn money. However, if you intend to use this investment, you should know the fundamental concepts. After internalizing them, you should ensure that you familiarize yourself with the various stocks. It is very popular and a majority of people have made their fortunes in the stock market.

Bonds – This is the best way of getting interest. You invest money in a bond for a fixed period of time. It is during this period of time. If you are in it, for the long haul, then this is the perfect investment vehicle for you.

Fixed Deposits – This is a type of account offered by a variety of banks. These types of accounts are higher than ordinary accounts. The account holder deposits the money for a fixed period of time.

Real Estate- This is a literal bricks and mortar investment. You can invest in a residential property or commercial property if you have the financial muscle. You can earn a good chunk of money by flipping the property or simply renting it.

Whichever investment vehicle you choose, it is important that you follow the advice of competent financial practitioner. Resist the temptation to go your own route chances are that you will make a mistake and this could ruin your chances to making a killing in your investment. It pays to follow the advice of a good guru. Please note, that there is a lot of risk that comes with making various investment decisions.

A Layman’s Guide To Understanding Insurance

Insurance has become a major part of our existence today. Its very existence is geared toward mitigating risk; there is a lot of uncertainty about things. One day things are rosy and the next, they are simply terrible. When an event leads to loss, more often than not the propensity to replace the thing that you lost is there. If you have enough money and your standard of living won’t be affected at the moment, then you won’t mind the event happening to you. However, if you don’t have money to pay to replace the lost item, you will struggle a lot. This is where insurance comes in.

One thing you have to know about insurance is that you must know your needs so that you can make an informed decision. More often than not people tend to make impulsive decision regarding insurance and go for the first package that they think will make them feel safe. However, when the event that leads to loss occurs and the claim you make is not paid out due to some technicality, you end up regretting getting the package in their first place. Hence, it is important that you go for what you need.

There are a lot of factors to consider when choosing an insurance package, especially if you are doing it for the first time. This article explores what you need to know so that you can get the package that will give you what you need.

Insurance and compensation

The core purpose of insurance is to mitigate against loss arising from risk. You cannot afford not be insured because risk essential puts people in a very precarious position of starting over from scratch in some instances.

There are a lot packages designed to mitigate against the different forms of risk that we are exposed to.

Types of insurance out there

Below are the key types of insurance out there.

1. pecuniary insurance

2. personal insurance

3. property insurance

4. liability insurance

PECUNIARY INSURANCE

When you have a business and are handling vast amounts of money, you must be insured against the loss of the money whether intentional or not. Apart from insuring against monetary loss, there are other policies that are covered in this. They include: legal expenses, fidelity guarantee, business interruption and credit insurance. When taking up this particular form of insurance, you should consider the various packages out there for a prudent decision to be made.

PERSONAL INSURANCE

There are various categories of personal insurance namely life assurance and accident policies. In these categories, there are sub categories.

1. Life assurance

2. Personal accident and sickness insurance,

3. Permanent health insurance,

4. Social security

These types of policies are vital for the protection against personal risk. Sometime, a long lay-off or even death heaps a lot misery on you and your loved ones.

3. PROPERTY INSURANCE

Property is exposed to a lot of risk that will result in loss. Below are the main categories of property insurance.

1. Motor Insurance

2. Marine Insurance

3. Fire Insurance

4. Burglary Insurance

5. Special peril Insurance

6. All risk Insurance

Compensation for the loss is contingent on the type of policy that one has.

LIABILITY INSURANCE

This is type of insurance mitigates against legal liability to others. Loss or damage can arise from negligence and one is liable to getting sued. If they lose the case, they must pay money from their pocket. What liability insurance does is that it prevents that from happening. What liability insurance does is that enables the insured to be protected against the loss that will arise from the payment.

It is categorised into employee liability and public liability. In the case of employee liability, this type insures against loss arising from the negligence of the employee.

The essence of liability insurance is to protect the financial interest of the insurer when law suits are filed.

Essential considerations that you should make when you are contemplating a policy

It is important that when you are considering an insurance policy you keep an eye out for a few things. They are as follows:

1. If you can afford the interruption in routine

2. If you can afford the time

3. If you can afford the loss itself

4. The premiums that you have to pay

5. The terms and conditions of the insurer

All in all, insurance is one of those things that you can ill afford to be without. At least when you have it, you can have peace of mind that you are protected.

What Every College Freshman Must Know About Student Loans

Going to college is a very telling time for young adults. It is a chance to forge long lasting friendship and acquire the necessary skills that will ensure that one lives a long and fruitful livelihood.

Paying for college can get very stressful considering. Education in this century has grown considerably in cost and in order to pay for it, you have to part with an arm and a leg. However, luckily enough there are means of mitigating the cost of student learning.

These means include scholarships, grants and loans. With scholarships and grants, they don’t have to be repaid. Instead, they are contingent on one delivering the required results. On the other hand, loans have to be repaid. In fact, the repayment process for student loans starts as soon as one graduates.

If you intend to take up a student loan, it is important that you educate yourself about the various loans that are out there. One thing you should realize is that student loans are different. They vary in terms of interest rates, deferment options and repayment options. This article highlights what you should know about the various loans that are out there.

For starters, student loans can be categorized in two ways, namely, federal loans and private loans.

1. Federal loans

These are government sponsored loans that are provided through the Federal Family Education Loan Program. They are characterised by low interest rates, multiple options for repayment and varied deferment options. They simply cover the cost of tuition and they don’t cover other expenses associated with education. These types of loans can be obtained from school banks and other lending institutions.

2. Private loans

These types of loans are obtainable from private lenders. They have very high interest rates and deferment options are there but have to be obtained at a price. They have no maximum limit but obtaining them requires one to have a healthy credit score. They need to be co-signed by a parent and their credit score must be very good.
Federal loans demystified

Under Federal loans there are two main types: Perkins loans and Stafford loans.

(a) Perkins Loans

In order for one to qualify for these loans, they must demonstrate need for tremendous financial aid and must enrolled in a school at the very least half time. These types of loans have a fixed interest of 5 percent and borrowing is limited to USD 4000 for undergrads and USD 6000 for graduates.

(b) Stafford Loans

In order for one to qualify for these types of loans, students must be enrolled in a school at least half time. Also, the learning institution should be a member of the FFELP scheme. Remember: Stafford loans favour full time students but that is not to say that as a part time student might not participate.

General conditions applicable for all types of Stafford Loans

Below is the specified criteria required to qualify for Stafford loans:

1. Enrolled in an institution

2. Business schools have first priority

The interest rate is fixed at 6.8 percent.

They also come in three categories: subsidized, unsubsidized and additional subsidized.

For more information on these loans, it is recommended that you visit a financial advisor or your bank.

3. Private Loans

These types of loans are also known as Alternative education loans.

For one to eligible for these loans, they must fulfil the following criteria:

a) Have a great credit score

b) Must have co-signer for the loan; the co-signer too must have a good credit score

Below are the main characteristics of this type of loans:

a) The rate of interest is higher than those of government loans

b) Credit score determine the rate of interest to be paid.

People use these loans as a measure to bridge the deficit created by government loans. In some instance, the government might give you part of what you need for the tuition and these loans are great for shortening the deficit.

In terms of options, they have very flexible repayment options but they are contingent on the loaned paying a bit extra.

If you are student who wants to take up a student loan, the aforementioned categories will be a great place to start. Remember: when you apply for a student loan, you are solely responsible for it when you graduate, hence it is important that you be well informed about the loan that you will take up. You will save yourself tremendous headache in the paying it back.

A Freshman’s Guide Getting A Bank Account

Banks have come up with a variety of products to cater to the different segments of the population. For parents, it is recommended that they initiate a savings culture in children, so that they can in turn imbue their children with similar values.

College is a new turning point not only in terms of the education aspects, but also in the cultivation of the whole individual. Managing finances is one aspect to this. In college, kids will have expenses. Prudent financial management will be the difference between thriving in college and being stressed out living from pay cheque to pay cheque.

Now it is important that student’ in college have a bank account so that they can have their finances in good order. Most students have this notion that the finances kept in banks is limited to housing big funds. This way of thinking is very counterproductive and should be changed. Even the small funds will become big funds with time.

Immense amount of patience is required when you embark on this journey toward financial security. When you want to take the giant step towards taking control of your financial future, the having the right bank account is crucial. That is why you should visit your nearest financial institution so that you can find out what they have to offer.

Never make the mistake of thinking that all bank accounts are the same. They are not. There are some that have a standing charge that is deducted every month and would deplete your funds if you don’t have a job. A through and critical examination of the facts surrounding the particular account is very important. When you visit the bank, take a few pamphlets with you and read them. If there are unclear notions expressed in the pamphlet, then get in touch with customer care. They will clarify any issues that you might have regarding the accounting package.

It is important that when you are looking for a bank account, you do all your due diligence. The prime reason for this is simply you avoid getting roped into by slick marketing; you indeed see things for what they are and not what they would like you to see them as. Most students are in a constant hurry. Chock it down to youth or urgency but when it comes to making a supremely important decision regarding your bank account.

There are packages that are packages that are designed to take money out of the student’s pockets and put in the banks coffers. As was mentioned earlier, the branding for these packages is just too good to peer through. However, it is important that when you are considering a bank account, you examine the fees that are charged. Ideally, since you are student, you should choose a bank account with no fees. The reason for this is that, depending on your employment situation, whether unemployed or part-time, you should not be paying the bank to keep your money; they should pay you, in the way of interest.

Bank accounts for college students come with immense benefits. For starters, there are some banks that offer overdrafts to their college customers. These overdrafts don’t accrue interest from the time they are drafted to when you graduate. It has to be reiterated that you have to read through the terms and conditions of the overdraft, nonetheless. You don’t want to get shocked at the end of the day that the overdraft requested came with hefty interest that you have to part with an arm and a leg just to pay back.

Secondly, college bank accounts allow students to get help managing their funds. There are some packages that come with a financial advisor. It is important to highlight that most college students have a poor saving culture; most of the will opt to just spend it all one blow and forget about tomorrow. What having a financial advisor does is that they provide you with perspective on your financial matters. They will tell you which areas will benefit you the most when you invest in them and financial pitfalls to avoid.

Finally, you get special preference and freebies when they are announced. This varies from bank to bank, of course.

The move to college is always filled with trepidation; there is so much uncertainty about how everything works in the larger college system. Finances tend to be a major area of concern. However, when you have a good student account, you don’t have to worry about money getting depleted quickly.

Planning To Get Your Feet Wet In The Investment? What You Need To Know First

We all yearn for financial security. Investments offer it. However, not many people know how to navigate the murky waters of investing. Most of the time, there is a lot of guesswork and in order to be successful, you must know the basics. Below are the essential considerations that you should make before taking the plunge into investing.

1. Know the essential requirements of the investment

It is absolutely vital that you have a clear idea of what is required of you so that you can meet it. This means that you have to contact the person in charge of registering new clients. This is the perfect time for you to ask all the relevant questions about the investment if you are still not sold on it. Ask him or her about the paperwork that you need to fill out and the legal stuff.

2. Knowing the goals for the investment

When you embark on the investment track, it is important that you know the goals for the investment. What is the motivation behind you making that investment? When you have a why, then you can stay the course when challenges present themselves. Most people who fail at investing don’t have a ‘why’. You have to be clear about the reason and keep reminding yourself of it.

3. Crafting an investment plan

If you want to be really good at investing, then it is absolutely that you have a clear plan of action for your investment. Plans are categorized into three main ones namely, buy, hold and sell. If you are going to buy, then buy low. If you are going to sell, sell high. In essence, your investment plan will hinge on you being a master at timing.

4. Understanding the various investment vehicles at your disposal

It is important that you meticulously study the various investment products out there before you choosing one. Most people view investing as a great way to make money, which it actually is, and that is why the do it quickly and carelessly. To them the money is the prize and greed drives them to going for the quick and easy money. That is how they fall prey to Ponzi schemes. If you want to avert being the victim of a Ponzi scheme, take your time to pour over the various investment opportunities that are out there. Consume as much relevant information about the investment vehicle.

5. Selecting a suitable investment

A lot of the time selecting a good investment is difficult. If you choose investments on the drop of a hat, then you are gambling_ the polar opposite of investing. Most people think that they are investing in a good thing when they choose the first investment that falls into their lap while in fact they are actually gambling. Meticulous care has to be taken in selecting an investment.

There are a lot of things that go in selecting an investment vehicle. Below are the main considerations that you should make:

a) Your appetite for risk

b) Your investment capability

c) The returns you are looking for

6. Diversifying your portfolio

Ever heard of the saying, ‘Never put your eggs in one basket’? It applies very well for investment projects. The primary reason why you should not do so is to avert the possibility of complete loss when the investment tanks. The markets have a yo-yoing effect that you should be wary of. Statistically speaking, the probability of all of your investments tanking at the same time is low and close to non-existent. It is only prudent that you diversify your portfolio and include other investment vehicles in your repertoire. Diversifying ensures profitability; if one loses money, more often than not the other will boost you.

7. Managing the portfolio

When it comes to managing your portfolio, you should strive to be very objective. Most of the investors that fail often go with their hearts and not their heads. They are guided by the prospect of making a killing in the market oblivious of how fortunes reverse their course. Markets reverse course very quickly; virtually in the blink of an eye. In essence, when you are looking to make a decision regarding your investment, you should strive to be as objective as possible. If you feel as though you cannot be objective, then you should hire someone who is not emotionally invested to make the hard decisions for you. It is only then you can rest assured that the portfolio is managed appropriately.

The Merits And Demerits Of Offshore Banking

There is something thrilling about logging into a computer to access funds from a foreign account. Internet banking has surged in popularity primarily because of that perceived ‘danger’. Companies and individuals have turned to offshore banks because they come with a variety of benefits.

Below are some of the core benefits that come with using offshore banking.

1. You can conduct business anywhere

Most people prefer offshore banker because it is flexible. You can do business anywhere on the globe. The problem with using conventional banking sources is that they more often than not let you down if the country you visit doesn’t have branch. What online offshore banking does for you is that accords you access to any currency of your choice whenever you need.

2. Protection from sovereign risk

There is always a risk that funds will be frozen by the Government through no fault of your own. When you have an offshore account, this risk is mitigated.

3. Tax benefits

When you have banks in an offshore account, you don’t have to worry about the tax implications. They are little to non-existent.

4. Higher Interest Rates

Most offshore banks have a low cost of operation, this is partly because they are usually online most of the time. The direct consequence of this is that interest rates are higher than conventional banks. These conventional banks have to meet compliance requirements which are more or less a form of taxation that directly translates to increase overhead cost and low interest rates.

5. On Demand Access to Statements

Ever had to queue just to get a statement for your bank? It’s quite distressing, isn’t it? Most offshore banks allow you to access your information online. You can get information about your money as and when you need basis.

6. Money Management

In this fast moving money market, the speed to transfer money is everything. Offshore banks are quite receptive to his and offer you services that allow you transfer currency across the world. Another aspect that these banks address is the issue of automated payments. Most business use the accounts to process salaries.

7. You can invest online

When you have an online account, it is easy for you to set up a brokerage accounts that you can use to invest in that country. The beauty about doing all of this, is that is virtually free. You can have money deposited online as and when you need.

The Disadvantages of Offshore Internet Banking

1. You court unwarranted attention from the Government

The very fact that you have money in an offshore account is cause for alarm in the Government. It raises a series of important questions that you might not want to answer. Offshore banking has received a bad rep over the years because there have been increased case of tax evasion because of the loose tax restrictions.

2. You need to learn a bit about the internet

Since most of the transactions take place online, it is important that you know how to operate a computer at first. You also need to pour over the manual so that you can operate your account efficiently. This is the primary reason why a lot of elderly are skittish about operating online.

3. Deposit timeline

Offshore banks lack the means to collect deposits remotely. If you can’t put your money in, then you have to question what the point of having an offline account. The cut off time in some banks is very limited. While most of the banking has to be done online, electronic scanning technology has not caught on in most banks.

4. Security and Fraud are rife

When you open an offshore account, it always recommended that you beef up your internet security. Some people tend to forget this and they are vulnerable to security intrusions. These intrusions have very serious ramifications. For starters, when your identity information is stolen from your computer, your banking accounts can be cleaned out a moment’s notice. Given that a lot of hacks relating to banking and other websites that have sensitive information have been reported in the news lately, you would be right to be a bit sceptical about doing business on your computer.

5. You becoming a prime candidate for phishing attacks through spam

Avoid opening emails you don’t recognize blindly. Your bank will send you emails and some nefarious characters will piggy back on this try to get your information. However, some emails are just too good to pass up for some people they fall into these traps very easily.

Disambiguating Investment

According to Warren Buffet, for one to become a successful investor, they need to make a good decisions and have be emotionally detached when making crucial investment decisions.

When you intend to invest, you must have a solid plan and stick with it. There will times during the investment process that you will be tempted to change your decision. You will simply be reacting to what the investment environment will throwing at you. This article explores how you can keep your head while investing and how to avoid the various distractions that come along the way.

Why you should focus on a trading plan

When you have a trading plan in place, it is very easy for you to enjoy growth in the midst of popular opinion, which at times could be very misleading if you follow it blindly.

Maintain focus on your plan

Financial markets experience a yo-yoing effect as has been exhibited by successful 70s to the tricky 80s and 90s. Wall Street has had a very rich history of the up and downs of the financial market.

As the years roll on, shifts in the market structure will be experienced and one has to adapt to these shifts in order to stay profitable. The internet Bubble at the turn of the 21st Century and the flash crash of 2007 made both winners and losers. What separated to the two was how they approached the market.

The three deadly sins and how to avoid them

Temptations abound when investing to either overreach, stay hopeful in a terrible situation or be fearful when confronted with serious decisions that have to be made.

Fear, hope and greed are very infectious while you’re investing. When you are afraid, chances are high that you sell low at instant without any thought of what happens thereafter. It is important that you avoid following for the extremes of emotions that will assail you when you are examining your investment portfolio. Maintain a neutral stance at all times so that you can know when to buy, hold or fold.

What you should have in your investment plan

Know what your goals for investing are

It is very important that you know why you are doing what you are doing. There are three key reasons why people invest and they are: income, growth and safety.

a) Income

If you intend to derive income from your investment, you should focus on low-risk investments that need no capital appreciation.

b) Growth

If you are in it for the growth, go for investments that require capital appreciation. These are idea for investors that have youth on their side and have a high appetite for risk.

c) Safety

Hedge funds and other low risk investments fall into this category.

Risk tolerance

Growth is always an interesting prospect when portfolios are involved. With this growth, you have to bear a significant amount of risk. For you to become a successful investor, you must be sure about how much risk you are willing to take. While you are investing, it is important that you have risk capital. This risk capital is the amount of money that even if you lose, you standard of living will not be affected significantly. When you intend to delve into an investment is vital that you learn as much about it as possible. Above all it is important that you keep a cool head while you are investing. No investment is entirely risk-free.

Asset Allocation

Risk capital has to be put up. If you don’t dare, you don’t win. Your portfolio must be examined critically and crucial decisions that will move it forward. A financial planner will come tremendously in handy. Depending on the assets on hand and the objectives you have for your investment, you should be able to allocate the assets that you will put up. Your risk tolerance should always be kept in mind when you are investing so that you can avoid going overboard when you don’t have enough to back it up. Over time, it is important that you review your goals so that you can diversify your portfolio.

Investment choices

Finally, your investment strategy should incorporate the type of investments and the goals they intend to achieve. It has to be reiterated that before you embark on any new investment, you must learn as much about it as you possibly can. Investments are risky in themselves but as long as you keep a cool head, you will be ahead of the pack.

Demystifying Secured Loans

Lenders are very particular about where they look at when they receive an application. They mainly look at you and the collateral you put up. If they are good with him, then they will consider you for a loan.

That was usually the case some years back, but nowadays, a lot of considerations must be made in order to have the loan approved. These are the mortgage payments (if any), disposable income, credit scores and others. This article will highlight some of the things you need to know when you are considering secured loans.

Secured loans – how to improve “you” in the eyes of the secured loan lender

You have to present yourself in the best possible light when are applying for a loan form a lender. Below are the keys to making it happen.

RULE 1: Find a reputable lender

Not all lenders are the same. Never fall into this way of thinking. When it comes to some secured loans, some lenders are very stringent and have very high interest rates. Other are looser and have less constraints. These are usually those lenders that are trying attract people to their institution.

RULE 2: Work with the broker

Paperwork gets on the nerves of a lot of people. Forget about how you feel about producing paperwork at every turn, focus on working with broker to achieve the goal of securing financing instead.

RULE 3: Go over your income

If you intend to take out a loan, you have to know how much disposable income you have at the end of the month that can be channelled to paying it back. You should have a candid discussion with the broker so that you can find out where you stand in that regard. As soon as you know what you can afford, you can avoid getting penalized by the lender because of being high risk.

RULE 4: Credit scores matter a lot, fix them

While the emphasis on credit rating is downplayed when it comes to secured loans, it is still important nonetheless. The key reason for this that you get a good rate when your overall credit rating is perfect. What a credit report will do is paint an overall picture about your credit worthiness. In order to succeed in getting a good rate, you have to keep your commitments at a minimum.

RULE 5: How you pay your mortgage is vital

Lenders tend to view their loans as some sort of extension of the mortgage. It is important that you keep up with the mortgage payments on time. If for some reason you were late on a payment, you have to have a compelling reason in place to explain this oversight on your part.

RULE 6: Collateral

Most people dread a visit from the repo man but that is what happens when you stop paying your loan and go in communicado. A lot of drama usually ensues during this visit, you’d best avoid it.

If you intend to put up your property as collateral you must be absolutely sure that the loan is worth it. The interest loan on the loan must be really low to justify putting it up.

Putting up a house a collateral is one of the ways that people use to get a secured loan. The state of the house will influence the rate. If you want a lower rate, you have to maximize the property value. To do this, you need to talk to a contractor.

RULE 7: The valuer cometh! Ye must prepare the way!

When you put up your house a collateral, a value will come. Valuations are usually a mater of opinion and you should seek to have a favourable one.

Learn to read the mood of the individual to avoid getting on their bad side. Be amiable with them to get on their good side.

During his or her visit, you should ensure that you assure that the house will be improved to avoid getting sued by the lender.

RULE 8: Presentation is crucial

It is important that on the eve of the valuer’s visit you ensure that the house is presentable. You never get a second chance to make a first impression.

RULE 9: Get a realtor’s input as well

Valuations are a matter of opinion and it is important that to have a correct one. This sounds like a contradiction but it is important that the impression that the valuer has about the house be a true and actual impression of what the house is. A realtor will help shape and reinforce the right opinion about the property.