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Archive for Personal Finance – Page 2

Americans Cut Back On Spending Due To Economy

By BankAim · Comments (0)
Friday, September 23rd, 2011

Recently a survey showed that 40 percent of Americans say that the uncertainty of the economy and the flimsiness of the stock market have gotten them tightening their belts and reducing expenses. Indeed it isn’t hard to see why. In just the course of two months, the economy has brought shocking news that are giving off warning signals to an impending second recession.

First, the political gridlock in Washington D.C. over the debt ceiling has resulted in the downgrade of the US credit rating given by the agency Standard & Poor’s. Then the annual growth of the US economy showed a poor 1% performance, which is much slower than anyone anticipated. Finally, the United States continued on with employment problems as job availability went to a net of zero percent.

If that’s not enough, the stock market has been showing such poor performance lately with a 15.8 percent loss by the Dow Jones Industrial Average in the first week of August. This however improved by the end of the month with only a 4.3 percent loss but then eventually plummeted again by the first week of September.

The economic crisis isn’t also just confined to the United States, sovereign debt has continued to rise in countries such as Portugal, Italy, Spain, Greece and Ireland.

With these news combined, consumers have begun to get worried making them think twice before taking cash out of their wallets. Despite these economic news however, 58% of the survey respondents are unaffected. They say that these news have not affected their spending habits. The survey also showed that women were more prone to tightening their purses than men, with a 43% for women and only 34% for men.

For the working population, the economic instability has also not affected their spending as much as those who are nearing retirement. Consumer spending can contribute a lot to the betterment of the economy. Sometimes the government can rely on this to keep businesses going. Hopefully the economic instability will have consumers lean more towards investing than hoarding their cash to result in better growth of the United States.

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Law of Attraction: Can You Attract Money?

By BankAim · Comments (0)
Thursday, September 22nd, 2011

Recently there have been scores of books and personal development gurus that have been endorsing the same mantra that claims any human being can get what they want. This theory has been around for generations but it was popularized during our time by the book “The Secret” by Rhonda Byrne.

“The Secret” isn’t an original concept by Byrne, it has just been copied, compiled, and repackaged to bring forth a message that has been said to be the treasure of all great men of previous times. So what exactly is the secret? Well, it comes in the form of “The Law of Attraction”.

Basically, the Law of Attraction states that “like attracts like”. Expounded, this means that if we think positive thoughts, we attract positive results. Whereas if we think negative thoughts, what we get will be negative as well. In fact, the law of attraction proceeds to explain that anything we think and believe in our mind, can manifest itself in the physical world. Napoleon Hill, the author of “Think and Grow Rich”, has a popular mantra that goes “what the mind can conceive and believe, it can achieve.”

So how does this work for money? The Law of Attraction although universal in nature, has been used most often as a way of reconditioning our thoughts with regards to money. Gurus say that as long as you have a mindset that attracts money, cash can flow easily and freely. On the same note, no matter how hard you work and try to achieve money, if your thoughts about money are negative, you will never be rich.

The last statement may sound drastic but there does seem to be some truth to it. Some people have a subconscious belief that “money is evil”, or “rich people are greedy”, or “if you’re rich, you’re unhappy”. These beliefs have been rooted to our minds either from what our parents tell us, or what we see on television. We may not realize it, but these thoughts are what dominate our brains causing us to have a negative mindset with regards to money. Because we think of money negatively, we also attract negative results thus the reason why most people remain poor or broke.

If we do believe in the Law of Attraction, this only means that we should begin to throw away any negative cliches about money. We should reiterate to ourselves that money is good and money comes easily and freely. They say that money only comes to those who have the mindset of the rich. Apparently with this small step of thought reconditioning, we can begin to attract the financial status that we’ve always wanted to have.

Some people believe, while others don’t. The thing is, what have you got to lose? In fact, even if the law of attraction is purely false, it still encourages us to think positively and have a better attitude towards the things we want to achieve. True or not, it may be the beginning of achieving success financially.

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Rich Kid Smart Kid: Financial Literacy for Children

By BankAim · Comments (0)
Monday, September 19th, 2011

Personal finance for each individual couldn’t be more in a rut nowadays. Apparently retirement savings aren’t enough, credit card and mortgage debt is rising, and people just don’t have enough for health care. Because of the ongoing financial concerns and the way the economy is going, it’s only wise to hope that our children will learn to be smarter about their finances than us.

However, despite these very real concerns, financial literacy just isn’t being taught in schools. Even when your child reaches college, there just doesn’t seem to be a course that would help them be prepared in terms of managing money. Luckily, some financial gurus have recognized the need for financial education especially among the young, and many have come up with resources and even games to promote financial education among kids.

One of these resources is “richkidsmartkid.com”. This website is an offspring of Richdad.com, which is the website of millionaire entrepreneur Robert Kiyosaki. Mr. Kiyosaki is well known for being the author of the Rich Dad series of books which opens the eyes of the average Joe with regards to some very simple concepts of money. One of these concepts is the differentiation between an asset and a liability. Many were shocked when Mr. Kiyosaki claimed that you house is in fact not an asset, but a liability.

Richkidsmartkid.com is an interactive website for children which features several games which children can play that is based around a core financial concept. It is a fun and easy way for kids to learn about the way money works without being faced with financial jargon.

Introducing the concept of money at a younger age helps kids become more prepared for the inevitable time when they will be managing their own finances. Building a solid framework of principles can guide them in their future decision making, preparing them for both savings and investments. For those who are financially literate, it is a given fact that the younger you begin investing, the higher the chances of reaping colossal rewards.

For those parents who are eager to help their kids become more responsible with money, there are many other resources available online. Gradually exposing children to the world of money can help them live a financially free life when they’re older.

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Should You Get Credit Card Insurance?

By BankAim · Comments (2)
Tuesday, September 6th, 2011

Credit card insurance also known as “payment protection plans”, works like any other form of insurance. It’s supposed to help when you come across a time of need. Credit card insurance in essence allows the borrower to stop making payments to the credit card company upon instances such as unemployment, sickness and disability without fear of being reported to credit reporting agencies or without being charged for late payment fees. These payment protection plans usually costs between 50-99 cents for every $100. This sounds relatively affordable and the benefits of not having to be pressured to pay when you just can’t seems extremely good as well. However, is a credit card insurance really all that it seems to be?

Although credit card insurance may seem really helpful, there are some kinks along the way that may make you think twice about availing for the insurance. For example, you find yourself paying for the insurance for several years, month after month, only to find out that when you finally need to make a claim, you’re not qualified. Or in fact, there’s some fine print that says that the credit card company may choose to honor or not to honor the claim. In fact, many plans require the borrower to exhaust all other resources of payment such as savings accounts and retirement accounts before finally halting the credit payments. With a policy such as this, you may as well not have insurance at all. Also, plans that cover unemployment don’t honor the loss of the job when it is caused by job performance.

And finally, although the cost of the plan may seem minimal, the higher the balance in the credit card, the higher the monthly payments for protection will be as well. The worst thing about it is that interest can even accrue on this amount, increasing the total payment you’ll need to make every month. This can eventually add up to a considerable amount which when saved, may be enough to pay off the bills during the time of need!

Considering the petty details and the no guarantees policy of some credit card companies, you may be better off without insurance. Either that or know your policy from start to finish to see if it’s really a good deal for you.

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How To Earn Money While on Vacation

By BankAim · Comments (0)
Tuesday, August 30th, 2011

Paid vacations are one of the things that every employee looks forward to in each year of work. We break our backs everyday at a job we don’t even like, comforting ourselves with the thought that in a couple of months we will be eligible to have a vacation with pay. However, is it truly possible for us to go on vacation anytime we want, and still manage to rake in some money in our pockets while sipping pina colada in Hawaii? The answer, is most certainly a yes. So how is it done?

First of all, this occurrence is very common among the rich. And it’s not because they are already rich that’s why they can manage to go on vacations whenever they want, it’s about how they created that privilege for themselves in the first place. The answer lies in a thing called “passive income”.

Basically, there are two types of income, active income and passive income. Active income means money comes to the hands of the person out of doing work actively. This could mean doing any type of work in a job, while exchanging effort and time for money. Passive income on the other hand, comes into the hands of the person even when the person spends little time and effort on the activity.

Obviously, active income is where employees fall under. They go to a 7-5 job, and if they absent without reason, they don’t get paid. And the only way to get more money out of the job is to do overtime work, which is again exchanging time for money.

Passive income is something that investors, and the rich have. Even if they’re playing with their kids or vacationing in a deserted island, their money keeps working for them. Passive income can come from sources such as property rentals, royalties for creative material, recurring sales in a business, and even sales with a blog or website you happen to own. There are various sources of passive income, and this is the secret that people have to learn to be able to be financially free.

Ironically, people often work for active income, not realizing that passive income is the true goal of financial wealth. To sum it all up, active income is when you work for money, while passive income is when money works for you.

Even if you’re enjoying sushi in Japan, yachting in Greece, and enjoying the sun in the Bahamas, your money keeps working for you, and you still get paid. So is earning money while on vacation possible? For sure it is. Even if you decide to live in the beaches of Brazil forever, you can still have money in your pocket.

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Need To Budget? Use These Tools

By BankAim · Comments (0)
Wednesday, August 24th, 2011

Budgeting is something we all have to learn and have the discipline to upkeep. However most of us just budget on a whim, bending our rules here and there just to make ourselves comfortable. Also, most of us aren’t accounting majors so we don’t really know what a budget is supposed to look like anyway. Technology however seems to be hearing the plea of the regular folks and has come up with some nifty tools that can help us understand our budget more, and have the discipline to keep it up. Below are some of the best online budget tools that anyone can use to help increase savings:

1. PearBudget – One of the easiest tools to install, this tool is basically just a spreadsheet that can be opened using Excel, Word, and Open Office. All you have to do is open it in your computer, input your data and your budget is good to go. The best thing about it is, it comes for free.

2. BudgetPulse – This application allows people to monitor their financial condition. It’s based on user friendliness, comprehensiveness and ease of use. A good tool for those who just need the basics.

3. Expensr - This application helps you track how much money is going to food and gas. Plus, you can also compare your spending with similar people so you’ll know how to improve your spending. This tool also has a forecasting feature to help you steer clear from financial surprises.

4. Mint- This tool is a free online financial management tool that allows you to link your checking, savings and even credit card account to your Mint account. This helps you keep track of deadlines, and see every transaction. Although some people are worried about giving out the confidential information, the site uses Yodlee to manage security information which is the same company being used by Bank of America.

5. Mvelopes Personal – This is an online personal finance and spending management system which is probably one of the best of its kind. It helps you keep a budget and live within it, all done automatically. Although this application does not come for free, it’s well worth the money.

There are many other budgeting tools available online. Some come for free, and others for a fee. Try and check which one works the best for you. Maybe just a little software help is all that you need to get your savings and your finances in check.

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Reasons Why A Bad Economy Can Be Good For You

By BankAim · Comments (0)
Wednesday, August 17th, 2011

Whenever an economic crisis hits, the media is filled with bad news, somber predictions, and all the reasons why people would soon be facing inevitable financial hardship. However, haven’t we ever noticed that when the economy takes a turn for the worse, some investors are as giddy as if it was Christmas morning? The thing is, a bad economy can be good, if you look at it the right way. Below are the 3 reasons why a bad economy can actually be good for you.

1. Low Mortgage Rates & Cheap Houses - When the economy is down, it brings every industry down as well including the real estate market. Although this could be bad news for people who have already bought property, savvy real estate investors are already scouting around looking for that perfect deal. In a depressed market, it’s always easier to find properties on the cheap, plus mortgage rates are extremely low, raking up the savings.

2. Own A Business? Say Goodbye to Competition – A bad economy can be very difficult for businesses because everything slows down. Consumer spending is at its all-time low, but yet there’s still that perpetual need to keep the cash flow circulating. A struggling economy can make business owners paralyzed, and this is when you step in to “steal” the competitor’s consumers. Some businesses are just not ready to survive a recession, while others thrive in it. By the time the economic crisis is over, it’s evident which businesses made it or not. Just be sure your business comes out alive and ready to take on the consumers lost by businesses who went bankrupt.

3. Cheap Stocks – Whenever an economic recession ensues, this signals major buying time for those who are interested in investing with stocks. For the seasoned investor, economic crises are what get him the big bucks. Some investors even park their money and just wait till the market goes low. A bad economy is like a stock free-for-all. Buy low, sell high as they always say.

These are only some of the reasons why there’s always a silver lining when it comes to a depressed market. This can signal major discounts and sales on worthwhile investments in the long run.

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8 Smart Tips To Save During Recession

By BankAim · Comments (0)
Thursday, August 11th, 2011

Let’s admit it, the economy is like a roller coaster ride going downhill again. Some analysts are even saying that soon enough, we might start using the “R” word again. So before anything becomes official, it’s about time to learn about some practical money saving tips that will help us during the rainy days.

1. Cut back on groceries - One of the greatest expenses we can have is on food. We just don’t realize it but food and groceries can cause a big dent on our budget. Cutting back on groceries doesn’t necessarily mean starving. It’s just looking for practical food alternatives that still taste good but are on the cheap. For example, choose to get a cheaper type of pasta or rice (you’ll hardly notice it!), buy in bulk on non perishable goods, and avoid the deli or confectionery area.

2. Learn to reuse your stuff – Of course, it’s the age old remedy of recycling. Not only does it keep the world green but it also saves on a few (if not a lot) of dollars. Creative ideas include making an old and rusty wooden door into a vintage outdoor table by simply adding some legs and a glass panel on top. It’s all about getting creative and taking old stuff to the next level.

3. Familiarize yourself with Craigslist – Craigslist as we all know, is a place to buy and sell stuff on the cheap. You could earn a few dollars by posting some things you don’t need online, and you can find secondhand goodies on the site as well. Remember, one man’s trash is another man’s treasure.

4. Buy Classic Clothing – Recession time doesn’t mean having to look shabby. It’s about buying classic pieces that could go with almost anything. For women, a chic high-waisted neutral colored skirt could go with just about any top for an executive look. And for men, sleek black pants could spell dashing any time of the day. Even scrounging around in a vintage thrift shop could land you some good pieces for a lot less.

5. Save on Regular Household Expenses – Switch off the lights when they’re not in use, turn off the computer when you’re watching TV. All these little habits could lessen electricity bills for you.

6. Let go of what you don’t need - If you’re not too much of a television fan, it’s time to let go of cable TV. That doesn’t mean cutting you off from civilization, it’s just a sign for you to keep abreast of free resources. For example, if you have an Internet connection, you could subscribe to certain channels you love. The world is getting more modern, and yes, Internet has TV.

7. Travel on a Budget – Vacations are certainly something that can dig a hole in your budget. After all, who doesn’t love to travel? However, when planning that next vacation, try to think of places closer to home. Travel expenses are much cheaper and you can still enjoy yourself. For Westerners, Asia is a good destination to go because of currency differences. You’ll be amazed to find what your dollar can buy in third world countries.

8. Discover working at home - The Internet is all the rage at this day and age. Right now, it’s easy to earn a few extra bucks by working online. You can even choose to build an online business. This strategy isn’t about saving money, but it’s also about earning more in a practical sense.

Recessions aren’t things to joke about. It’s when the prices get higher, employees get laid off, and the world in general gets tougher. But if you’re smart in your money moves and save in all the practical places, you’ll find yourself getting through the tough times and coming out as a winner.

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8 Hot Tips To Save on Back-to-School Shopping

By BankAim · Comments (0)
Saturday, August 6th, 2011

It’s already August and it looks like another school year’s about to begin. Although this could mean exciting things for your child, parents are often caught spending more than they should – as if they were Christmas shopping. So if you’re a little tight on budget, save on the school shopping with these 10 hot tips.

1. Plan ahead, shop early – This advice always works, even for Christmas shopping. The advantage of planning ahead is that you can nab good items at earlier discounts such as Summer-end sales. Since kids usually wear short sleeved polo shirts most of the year, capitalize on that idea and get the basic pieces at good prices.

2. Scout the Old Stuff - Yes, there are certainly supplies that you can reuse. If that backpack still works, then just savvy it up with some button pins or bag charms. There’s really no need to get a new one just for the sake of the beginning of the school year.

3. Stick to the List – Just like grocery shopping, make a list of the things your child really needs. Once you have that all in the list, resist the urge to stray from it. A good idea would be to plan out the list with your child, to prevent whining and pouting when he decides that he wants that pricier lunchbox just because it looks better.

4. Don’t go cheap – Although cheap things may seem tempting, it’s best to stay away from them if the item is meant to last the whole year. This rule goes for clothes, bags, and especially shoes.

5. Resist the Urge to Buy Bulk – This advice is targeted to parents who choose to buy pencils, pens and other supplies by the bulk. When your child sees the mountain of supplies easily available to him, he’s more likely to lose his pens and crayons because he knows it can easily be replaced. This means buying more in the long run.

6. Go online - Good deals can usually be found online, and online trading doesn’t mean just buying stuff. If your child has some old but usable things, try and sell them online. You just might find a buyer.

7. Shop in Garage Sales – Neighborhood sales is a good place to find things that are still in good condition. Just make sure your child isn’t getting his classmate’s last year’s backpack. That could lead to some childhood frustration and humiliation.

8. Get organizers – Although buying a pouch or pencil case may seem like an extra expense, this could actually be quite useful. Getting your kid an organizer for his stuff can prevent him from losing things, and it can also prevent you from buying the replacements.

Try to get your kids what they want (and need of course!), but make sure not to give in to whining and extra requests. Be reasonable and firm in your shopping, but don’t be too thrifty to cause your child to be embarrassed in school. School shopping is just like buying new clothes, it takes time and patience.

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