Finance for non-Finance Professionals

How to produce unique finance articles everyday

2009-10-17T20:41:00.000-07:00

One of the most difficult tasks of being a niche blogger is publishing a unique post on a regular basis. Producing or capturing fresh idea every day, writing a post around it, seems to become an impossible feat. Sometimes, it would even take a month for me to really come up with something unique to blog about. How do a blogger overcome these ‘blogging blocks’?

Here are 3 tips you might want to consider to help you produce unique finance articles everyday:

1. Monitor the stock market. The stock market is volatile. Stock prices varies considerably by the minute. Any stats coming from the federal government, like unemployment rates and consumer index, can push prices up or down. Bankruptcies and declaration of losses coming from prominent or huge companies can cause a knee-jerk reactions in the trading floor, take for example the G.E.’s and Bank to America’s announcement of financial losses last week. Moreover, even important announcements coming from the White House can also directly influence how our stock market behaves. If you are closely monitoring these movements, surely you will not run-out of ideas to blog about finances. Read the business section of the daily regularly, better yet Google it.

2. Read other finance blogs. Get or borrow ideas from them. Don’t forget to link back though. React to what they have written, agreeing, disagreeing or amplifying some points. Thus, instead of making a lengthy comment on their post, write a separate post about it instead.

3. Publish other bloggers’ finance articles. Okay, I know this is the easiest part. But of course, do this with permission. Otherwise, you will be charged with copyright infringements or worse, of blatant plagiarism. If you have no idea where to get these articles, you might want to check out the finance section of ArticleAlley.com.

Happy blogging!

Saving for a Personal Emergency Fund | Essential Element to Effective Money Management

2009-07-27T15:32:00.000-07:00

None of us have the ability to foresee the future or predict the hurdles which lie ahead of us. This makes saving for an emergency fund a financial priority. An emergency fund is an essential element for an effective money management. Since you’re rarely given advance notice of a setback or an accident which will keep you out of work for an extended period and suddenly confronted with money problems beyond your control, an emergency fund will always come in handy. It is also your safety net that can save you from bankruptcy or severe financial hardships in the event of an unexpected change in your income or expenses, or obviously in a severe economic downturn like this.

Saving for an emergency fund should be a vital part of an individual’s financial planning. This is of high importance if you don’t already have readily available funds in your account for covering any unanticipated expenses. They provide financial security because they give you funds to fall back on if you become ill, or if you or your spouse loses your job, you incur large medical bills, or have an unexpected large bill such as a major car or home repair. You do not want to end up in a situation where you have to buy daily necessities on credit and end up payments on groceries you bought two years back on credit, with a further 10-18% interest on it.

Saving your money in an small account for emergencies is definitely a better alternative to taking a loan or cashing in your long-term investments. If you take a loan, there is the additional burden of paying interest. Encashment of your investments before maturity means not only will you lose out the interest, but also some part of the original investment. This will also set you back significantly in your overall financial plan.

Success at saving for an emergency fund depends on consistency of saving money on a regular basis, and resisting the urge to dip into this rainy day fund for non-emergencies. This money should be kept separate from the general savings account. Otherwise you will be tempted to dip into these monies even if you simply run over your budget at a certain point. A substantial part of this emergency fund account should be invested in low risk funds. This ensures that your investment does not lose its value in case you need the money. Also, it should be extremely liquid, to give you access to the cash easily and quickly if you need it.

The size of the special savings account will depend on your personal situation. People often keep three to six months’ salary in the reserve. But you will have to decide on an appropriate amount based factors such as your dependents and fixed monthly expenses.

If you are single with no obligations, and have a reliable support system of friends or relatives during a financial crisis, you might not need a substantial amount stashed in this fund. This is opposed to someone who needs to pay nursing costs for his aging parents and supporting a young family. The more people you support, the more likely you are to have unexpected or unplanned costs.

While making a decision about an emergency fund, you should also take into account the degree of difficulty you'd have in finding a new job if you lost the present one. In case of a two-income household, the contribution of both parties should be weighed while calculating how much you should keep aside.

You may not be able to gather your emergency fund money together at once. Treat it as a financial goal and add to the kitty over time. If you get a tax refund, put it in your special rainy day account. Maybe a part of the bonus at work!

Buying Investment in Real Estate during a Recession

2009-07-01T09:46:00.000-07:00

While most economists see that the U.S. economy no longer in free fall, I remain apprehensive about buying investment in real estate. You cannot blame a little skepticism on how the projected economic rebound is going, and me, if I remain unhurried.

I share, probably, the sentiments of many that as long as there are no clear and solid indications that this economy is gearing towards recovery, I will keep my money away from any form of investments, especially on property. Although, the current fall in selling prices is too tempting to ignore, for example, the buying and selling mood in Missouri real estate.

Investing always entails many risks. But seasoned and smart investors understand that making sound investment and financial decisions should not only be made based on the condition of the economy and how the market is behaving. There are still other important factors to be considered other than these obvious conditions. In addition, and in fact, we have seen and heard of stories of self-made millionaires who made more money when they invested regardless of the state of the economy.

So, where do these things lead us? The question I posed remains: Should buying investment in real estate during a recession a good financial decision?

In my mind, it is a ‘yes’ and a ‘no’. Yes, because the prevailing low prices in properties on sale and the all time high rates in property foreclosures signify a possible good yield when the economy gets better. Of course, this means taking an optimistic stance. On the other hand, it is a ‘no’ because it could mean having your money tied for an uncertain period of time, with which you could have placed them on other high-yield investment ventures.

In all these, I’d like to take the position of Tim Blixseth, one of America's richest:

I swore I was going to exclusively collect assets and not liabilities for the rest of my life. I swore never to take gambles I couldn’t back up, or that I couldn’t afford to lose. And, I’ve stuck with that ever since.

Save the Money, Save yourself | Saving Tips worth Trying

2009-06-16T14:07:00.000-07:00

Money saved is money earned. How many of us believe that, or practice that consistently? I have always believed that when you save a portion of the money that you earned, you will eventually save yourself in times like these.

Alright, there are obviously many ways to save money and lead a frugal life without necessarily becoming a Mr. Scrooge.

Money problems will always torment if we do not learn how to save and practice frugality. It is important to know how to manage money efficiently to ensure bulky savings. We should make it a habit to ask ourselves whether to save a portion of what we have to spend now or whether to spend at all. Here are a few money saving tips worth trying:

First, in case of large investments, you might want to consider seriously the ROI or Return on Investment before you make the decision. The bigger the investment you make, the greater the risks you take. Between buying a brand new and used car, which do you think can provide a good ROI?
Buy in bulk and buy items on sale, but not at the expense of quality.
For financial investments, like stock or day trading, follow the golden rule of buying volatile stocks when the price of an item is down and sell it when it is high. The profit thus earned can be invested in the equity market for steady items.
The internet has provided the best opportunities to shop for the best price before you make a purchase. This means that you can conveniently compare products and prices.
Create a monthly budget to the essential items you need, and stick to it.
Plan what you eat on a daily basis ensuring you hey proper nourishment. You do not only save money from proper food planning, you stay healthy and thus eventually save money from medical expenses.
Pay your bills on time. This way, you save money from interest rates charges and penalties.
Last, but not the least, prioritize, prioritize, and prioritize. When the most important things are taken care of, you will notice you will have surpluses from your budget, which you can add to your savings.

Start saving today!

Recession and Satellite Internet

2009-06-16T13:19:00.000-07:00

What is the connection between the two, you probably have asked.

To some degree, there may be a correlation between how fast the internet has encroached our way of living and doing business, and with how and where our economy is headed.

When Alexander Graham Bell made the first call on his new invention, a.k.a. the phone, it awaken the civilization into the possibility of communicating through the wires. With that, the industrial revolution was hastened, commerce grew exponentially, and connecting with other people has been made convenient and easier.

Then the mobile phone came in –you know the rest of the story.

Now, satellite internet. With a cellphone, you can call anyone, anywhere. With a GPS, you will never be lost. Now, with wild blue satellite internet, you can virtually access the wealth of information over the net that is actually perpetually growing every second. The likes of Wild Blue, have enabled internet access possible anywhere and even the in the remotest locations.

Ironically, with this technological breakthrough, we have driven our economy backwards. I am undecided whether this is a simple oversight or an utter neglect on our part. With the advancement of technology and the availability of information, these would have made us better stewards of our resources. But unfortunately, we were not.

3 Important Elements on Day Trading Investing Basics

2009-06-15T14:44:00.000-07:00

In my first two years working after college, I was also among many business graduates who got lured into pursuing a career in stock trading and finance portfolio management. In my case though, after a month of training, I lasted only a couple of months. I resigned and took a job on sales instead.

One of the reasons I quit too soon is because I do not have the guts to take the necessary risks in day trading.

The senior stockbroker assigned to train me and monitor my progress is successful to some degree, and he seem to enjoy both the euphoria and frustrations stemming from the results of the day's trading – I don’t.

But over the years, and as I steadily climb the corporate ladder, I began to fully appreciate what is going on the trading floor, although I am now a fence sitter of sort. I bought several stocks and bonds as part of my personal investment, and tried to monitor any changes in their values from time to time.

In my mind, there are at least 3 important elements in day trading investing basics, namely: money, knowledge, and a plan.

Money

In spite of the data and analytical tools available, stock trading is still unpredictable. It is so dynamic that you can be rich overnight, and broke the next day. Hence, you need to be prepared to use money that you can afford to lose. Otherwise, if you have places all your savings upfront, you might find yourself sleeping on the pavement when the trading day is over. The key here is prudence. That is, taking it slowly and building your portfolio from the profits you gained from successful trades, and rolling them out when you deemed favorable.

Knowledge

Never rely entirely on what your financial advisor or your friend tells you. Learn what is going on the floor and in the market. Buy and read good books on the subject, there are many to choose from out there. Read trends and analysis made by experts online or from newspapers.

If you are contemplating day trading as a career path, you might want to consider getting the right training from the experts like what they offer at TradingAcademy.com.

Considered today as the leading trading school in the world, Trading Academy.com offers extensive and effective training on the rudiments of day trading in any market conditions. Their courses, classroom and online courses were designed for the novice and the experts, traders and investors alike whose primary goal is to provide the right competencies in trading.

The bottom line here is getting all the information and skills you need to help you in your trading decisions. To hammer the importance of this point, Alan Greenspan spells this to us more accurately:

It has been my experience that competency in mathematics, both in numerical manipulations and in understanding its conceptual foundations, enhances a person's ability to handle the more ambiguous and qualitative relationships that dominate our day-to-day financial decision-making.

Plan

Presumably, you have now the money allocated, and have the basic competencies to start trading, then you need to draft an investment plan that you can refer from all the time. This investment plan will help you organize your investments and keep you on track.

Stock trading is stressful for both the investor and professional trader. As an investor, you need to be a step ahead always. Your plan should include not only how much you are going to invest, buy or sell, but also the rationale and timetable behind those investments. It should also include your exit point (the price that you will sell your investment at to take profits) and the time you want to allocate for your investments each day, which involves monitoring and studying their movements. This plan is your trading blueprint, and it will help you reduce unnecessary errors and run into unnecessary risks.

Again, I am speaking from a layman’s perspective here. There is still no substitute from an expert’s advice, which you should refer to more often.

Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell. ~ Sir John Templeton

Being Frugal | Every Little Bit of Savings Adds Up

2009-06-12T18:55:00.000-07:00

Living on a budget and being frugal are important steps to financial freedom, but getting started can be frustrating. When we look at our expenses and see all of those bills we are paying every month, it's easy to throw our hands up in disgust. Sometimes, cost savings initiatives will take the back seat because of this.

But what about all those little expenses we incur? You might be surprised to find out just how much they amount to.

It's easy to dismiss cutting back on little things. A few dollars a month won't make a significant difference in the big picture. But a few dollars here and a few dollars there adds up to a few more dollars. When you cut back in many small ways, you could end up with a lot more money at the end of the month.

Simple Frugal Budgeting Tips for Households: Waste Not, Want Not

One thing we can do that is good for the budget is stop wasting so much. This can apply to many areas in our lives. From eating to home heating, waste equals money going down the drain unnecessarily.

Cooking for the family instead of eating takeout or dining out is a great way to save money. But if you're throwing food out, the benefit is reduced. So if you have leftovers, don't let them end up in the trash. Some dishes freeze well, and this makes for easy dinners when you don't have time to cook. You could also eat dinner leftovers for lunch the following day.

If your home is not well insulated, you're probably wasting lots of money on home heating and cooling. Insulating will cost some money up front, but it will pay for itself quickly. If you have drafts around windows and doors, weatherstripping can help maintain the temperature of your home.

Most households waste an unbelievable amount of electricity. This can be prevented in part by using energy efficient appliances and light bulbs. Turn lights, televisions, computers and other devices off when you're not using them, and open blinds to take advantage of the sun's light during the day.

Practical Frugal Living Habit: Do It Yourself

Any time you pay someone else to do something that you could do yourself, you're spending money unnecessarily. This applies to little things like buying coffee instead of making your own, as well as to larger expenses such as home repairs.

Many of us buy coffee or a soft drink from a convenience store or coffee shop on the way to work in the morning. This can really add up over time. Instead, make your own coffee, or buy soda in 2-liter bottles and pour some into a smaller bottle or cup to take with you. The same applies to lunches. Instead of springing for fast food, take a sandwich or something microwavable to work.

While we're not all good at all types of repairs and maintenance, most of us can do some things for ourselves. Maybe you could change your own oil instead of paying someone else to do it. If the walls need painting, consider getting friends and family to help you do it instead of hiring a painter. Things like these can save us a noticeable amount of money right away.

When you add up these cost savings, little things can make a big difference to effective frugal budgeting. So take a close look at your budget and see what small expenses are lurking there. If you can eliminate or reduce them, it could positively impact your bottom line, and you will worry less on problems with money, better yet worry no more.

What’s your take? Care to share any frugal ideas or practical family saving techniques?

Using Cheap Home Alarm System from ADT Alarms

2009-06-12T07:11:00.000-07:00

Safe and security of my family take a very high priority. Home security systems are investments, regardless of economic downturn, that cannot be set aside.

While we can always choose a safer and secure neighborhood, we cannot negate the possibility that burglary or illegal intrusions into our homes can happen anytime. Sometimes, neighborhood of little known incidence burglaries can be likely targets. Hence, home alarm systems in place are always handy.

However, the real issue as far as installing security and alarm devices is affordability and reliability.

Thus far, nothing can closely match the services provided by the largest provider of electronic security services in the nation today than ADT. In fact, even before you consider cost hurting your household budget, the reliability of cheap home alarm system that ADT provides outweighs the investment you will make. With the aid of their Home Security Wizard, which is readily accessible on the internet, you can easily identify your requirements for you home alarm security. Also, you can even get the actual cost requires for the installation of your security alarms and thus can decide objectively on the allocation of budget.

Better safe than sorry, as they say. My two cents? When deciding on this issue, make reliability your foremost consideration, then cost as secondary.

Some thoughts about unsecured personal loans

2009-06-10T21:49:00.000-07:00

Some of us can easily justify the recession or our perennial problems with money that we are easily swayed into getting unsecured loans. Who would not?

However, allow me to throw a few concerns or thoughts about getting unsecured personal loans.

Some of my friends seem to have made this a habit whenever they run into money problems. While I do not negate entirely the help that comes from an unsecured personal loan in times needs, this should not become your primary solution. Your money problems will continue to recur if you are dependent to this quick fix solution. In most cases, a change perspective and attitude towards money management can provide a long-term solution.

Credit and Debt Consolidation | Small Step to Financial Freedom

2009-05-15T07:37:00.000-07:00

“Financial freedom is a buzzword for our generation. It is the pursuit of literally millions of people. So what is it? Is it that elusive? Can anyone get it?” ~Chris Widener, a Motivational Guru

Though ‘elusive’, financial freedom is achievable by anyone committed in its pursuit. However, for the wishful thinker and daydreamer, this is nearly impossible to achieve. Because financial freedom does not only require the desire to earn it, but also the will to take the necessary steps, however painful, to achieve it. It begins in the mind, then channeled into a determination to take positive actions towards financial independence. As Dave Ramsey (Total Money Makeover) puts it aptly:

“Winning at money is 80 percent behavior and 20 percent head knowledge. Most of us know what to do, but we just don’t do it.”

One small yet difficult step to take is getting out of debt.

Unpaid bills, credit card debt, and other loans can be financially disastrous if they remain unsettled for a long time. It is very difficult and even discouraging to work just in order to pay for your outstanding debts and their annoying interests. The longer you delay your repayments, the more you incur interest and further ruin your credit standing. Consequently, bills will continue to pile up before you can even start paying the last one. Get out of this rut, as soon as possible.

One practical alternative is debt consolidation. This involves making a onetime loan enough to cover for all your outstanding debts. Debt consolidation loans are usually charge lower interest rates and offer a longer repayment scheme. This is hassle-free on your part because you will have to deal with a single lender. So with all your outstanding debts and loans covered, you can focus your effort on one single loan amortization. This is but a small step, but is one effective step towards financial freedom.
To hammer this point deeper, allow Chris Widener to amplify my point here:

Want financial freedom? The first thing you should do is to get out of debt. That is priority number one. One of the reasons I have financial freedom is that I have no debt other than my house payment. And I work hard to manage myself and our home to keep us that way. For years I drove an old junker car, and while I looked bad, I had financial freedom that others who were in debt didn’t have! There is an old proverb – The borrower is the servant of the lender. Who has freedom? The lender. Who doesn’t? The borrower. Develop a plan to get out of debt!

Obtain and Monitor Your Free Credit Report Regularly

2009-05-15T05:09:00.000-07:00

While there is indeed a need to overhaul a majority of our financial institutions and the credit industry is still struggling to rise back, consumers nevertheless have the responsibility to obtain a copy and monitor their credit report on a regular basis.

Why do we need to monitor our credit report regularly?

First, our credit report states our financial health or status on record. Banks, loan agencies, various government agencies, and your employer can easily obtain a copy of your credit report and use it as a basis for any transaction. Even apartment landlords would even check this report and can make this a basis for accepting or rejecting you as a tenant.

Your credit report, in a sense, bespeaks of your financial credibility.

Second, your credit report is not absolute. Meaning, it could be prone from errors. If you are monitoring it on regularly, you can easily detect these errors and have them rectified immediately. Hence, you will not be surprised, in case of a negative score, if you were denied of a particular loan. More so, in cases of negative score, you will have a basis to work on an improvement of your credit rating.

Lastly, identity theft is commonplace. With more than half of our purchases and other transactions being done online, scrupulous and malicious individuals can easily intercept the data you sent, especially personal information. Thus, in most cases, errors that are reflected in your credit report may be attributed to identity theft.

Federal laws dictate that you have a right to obtain a copy of your credit report once a year free. Not only that, you can always check for a free credit report online. Better safe than sorry, as they say. So, check your credit report regularly.

Unsecured Loans in Desperate Times

2009-05-15T02:30:00.000-07:00

“Desperate people, do desperate things.”

Have you heard that popular maxim? I am sure that most of you were caught in the same predicament, many times before or perhaps you are in one right now. Desperate times can force us to take desperate measures, especially during emergencies and calamities. These are the times where that extra money saved counts. Unfortunately, for some of us, we have not set aside that kind of money.

So, where do we turn to for help or immediate relief?

In a recession like this, most of our friends and relatives may also be suffering the same fate. So, where do we turn to when you exceeded already your card’s credit limit, and your savings account has already dried-up?

Unsecured personal loans from a refutable lending company can be your bailout. Although, in some cases, interest rates may be higher compared to other type of loans. Nevertheless, unsecured loans when carefully chosen among other offers will surely help. These can be availed immediately and without so much paperwork if you qualify.

But again, in my simple mind, you do not have to resort into more borrowing if you have carefully planned and managed your finances. I think, that’s the bottom line. Crisis or not, those who are prepared will not be shaken.

Personal Finance Management Basic | Getting the Right Information and Acting on it

2009-05-01T12:35:00.000-07:00

"If you know how to spend less than you get, you have the philosopher's stone" - Benjamin Franklin

The trouble with most of us, who are struggling with our finances, is that, we know how to manage our finances, but we simply don’t. We know that spending less than what we earn is the right thing to do, but we live to ignore it. We are always satisfied with gratifying our desires when we spend more for things of no value and suffer the consequences later. To me, this seems like a self-inflicted money crisis.

We struggle through life trying to find answers to our financial dilemma, when in truth; those answers are just staring at you, waiting to be tapped.

For example, we know how important it is to set aside a portion of your income for emergency or health funds; that insurance premiums are actually investments for future needs; that there are many things that can wait like those we crave so much; that getting a mortgage more than what you can actually afford after based on your net pay (in this context, including all your personal obligations except the mortgage payment; etc. We seem to care less.

We no longer need raising financial management questions and answers shove on our face. What we need is to act on that information. There are literally thousands of finance management “how-to’s” articles, wikis, blogs, ebooks, and websites over the net; and you can even find a good article on an online dictionary or encyclopedia. But what we do on the information we get is actually what matters most.

As I have said, we do not need a new gospel on personal finance management, what we need is walking the talk, so to speak.

Is Debt Consolidation a Good Idea? Can it free you from Bad Loans?

2009-04-27T19:47:00.000-07:00

I read this funny quote on a magazine and wrote it down on the front page of my planner:

A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain.

Funny. But, ironically true. Loans can help us in our dire needs and more often, in acquiring what we so desire. However, during payback times, we sometimes find ourselves in sticky situations where we regret taking those loans. Okay, do not take me wrong on this. I am in no way against loans, as long as you are able to pay and you use them for good intents and purposes.

The danger is, getting loans can become a bad habit and will wreak havoc on your finances and your whole life. Usually this happens little by little. It begins with unnecessary purchases using your credit cards, then followed by an ‘untimely’ purchase of a new car via a car loan or through a lending company, or borrowing money for a extravagant celebrations, and more. Then you wake up in the morning to find your mail boxes filled with demand letters.

Here’s how you should deal with that sticky situation: Get out of it!

Easier said than done. But you can get out of that pesky situation. It is doable.
For one, you might want to try debt consolidation for your larger loans and those bills that endlessly badger every end of the month. By consolidating these things, you can better manage your debts. So that, rather than paying off several separate bills each month, you loan from one among legitimate debt management companies who will arrange a low-interest and flexible repayments for you. Yeah, that can be arranged. Now, I see the sign of relief in your eyes. Debt consolidation is a good idea for freeing yourself from bad loans and other debts. Also, the key here is finding the right finance counselor or debt management expert to help you.

What’s next? Break the habit! Be contented with what you have. Save for the rainy days, and spend only on your needs and let that 54-inch take the back seat for awhile –that is, do not spend on wants unless you have money to spare. Lastly, educate yourself. You might want to peruse more info on debt collection basics and how to improve your credit score.

“Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.”~Benjamin Franklin

Credit Cards for Bad Credit | Are we just trying to make things worse in our personal finances?

2009-04-12T00:52:00.000-07:00

I do not want to sound pessimistic here, but it seems there are no clear signs as to where our economy is going. While politicians continue to debate on which more appropriate course to take, many of us are tripling out efforts to make both ends meet.

To me, although the government and some of the biggest financial institutions are to be blame on the current financial predicament we are all in, we are (on the individual level) to be blamed mostly from our financial woes.

The root could be traced with bad credit loans, and then followed by undisciplined use of the credit cards. I am not entirely against these plastics, but rather on the inappropriate use thereof.

We love convenience, luxury, and things that we do not actually need. In fact, it all begun there. Bad credit loans, unpaid bills, unmanageable mortgages, and bad credits are but results of satisfying our appetites for the good stuff that we cannot actually afford.

Then when we have almost completely mess-up our finances, we get another a lifeline via credit cards for bad credits? Are we just trying to make worse?

However, I must admit (and before I am accused of pontificating here) that in a recession like this, bad credit credit cards can somehow serve their good purpose, at least temporarily. What I mean with good purpose is, paying for obligations that may not otherwise be met by our current income. With a bad economy coupled by your own bad credit history, these type of credit cards are sure haven of rest.

Nevertheless, this time (or should we have exercised the same in this first place when we got our first plastic?) caution and prudence must be strictly observed. The key here is taking the time to compare interest rates, APR (Annual Percentage Rate), Cash Advance Features, miscellaneous fees (such as application, late payment charges, annual fees, foreign transactions, etc.), Rewards and Bonuses. In this case, you might want to check out the credit cards comparison that BadCreditOffers.com publishes.

Common sense dictates that you cannot solve a problem by creating another problem. Vis a vis, you cannot repair a bad credit history, or your growing debts by getting more bad loans and/or wanton credit card usages. Discipline is not an option, but a must these days if one wants to survive, better yet, thrive in this crisis.

No Medical Exam Life Insurance | Would you still invest on life insurance policies?

2009-03-27T19:58:00.000-07:00

After the financial meltdown of AIG, considered as one of America’s oldest, biggest, and most stable (or at least, we have all led to believe) insurance companies, would you still consider purchasing a term life insurance policy? Or, even trust your future with a ‘no medical life insurance’?

I have always believed that any type of insurance policy purchases is actually an investment in the future. Oh, I still believe it is.

While many of us would place insurance premium payments at the expense column of our personal finance books, I chose instead to have mine under the investment column. In fact, in spite of the current state of the economy and the financial topsy-turvy at Wall Street (forgive my pessimism and sarcasm there) I still trust my insurance company and the coverage it guaranteed in my policy. Premium payments for my health and term life insurance are on the top of my priority list. Are you doing the same?

Any type of insurance is to be regarded as an investment for the future, especially for unforeseen events such as illnesses, accidents, and/or even death. We owe it to ourselves, and to our families. Thus, setting aside a portion of our income on insurance payment premiums should not be disregarded or neglected.

These days, many insurance companies have decided to lower their premium rates and increase the value of their policies.

Uh, AIG? The bonuses? I know. But in my mind, this should not prevent us from trusting other insurers. Would you?

Moving on, would you consider purchasing a ‘no medical exam life insurance' policy? It is a lot cheaper, they say, than regular life insurance policies that require strict medical examination.

However, in my mind, isn’t it the primary reason why you need to undergo this medical examination is to determine how much premium you are going to pay and the extent of the coverage? Meaning, if the results indicate that you will likely live longer or stay healthy throughout your adult life , you will pay cheaper premiums. Conversely, if the results show that you have signs of early ETD, then you be charged higher.

Here is my take, simplistic as it sounds: To me, regardless of the medical tests results, whether it is a no medical life insurance policy or not, I will not hesitate to purchase one for myself and for my love ones. Purchases today will always be cheaper than tomorrow’s.

This is just my two cents. What is yours?

Dow drops below 7K | When I read this news, I look at my wallet

2009-03-09T12:27:00.000-07:00

When I started reading my RSS news last Tuesday (03 March 2009), I had to take out my wallet and count the money that I have, check my credit card balance over the phone, and my savings account online. I must admit, I panicked. Who would not? The headline reads:

“The Dow Jones industrial average plummeted below 7,000 at the opening bell and kept driving lower all day, finishing at 6,763 — a loss of nearly 300 points. Each of the 30 stocks in the index lost value for the day. “ (AP | read full story)

My feelings are shared by many investors and stockbrokers, especially when AIG announced their $62B loss for 2008 4rth Quarter. I wonder if the bail-out package they receive will suffice to resuscitate their financial health.

As much as I disliked bad news, I cannot help but look into what is happening in the international money market. For me, bad news can be a good starting point for introspection, reality checking, and a basis for conceiving proactive solutions. The prognosis is bad. The recession is still wreaking havoc. But does this means that we stop living? Or stop making a living?

It is true that money, while essential, is not all there is.

Oh, crap! You know that I am just trying to appease myself there.

However, if we look things in a lighter perspective, we will begin to see that everything is but temporary and that this economy ( as one prominent economist argues) is bound to rebound (pun intended) whether we tinker on it or not. I agree because, we are all typically resilient in adversities. Nature taught us that.

The clichés "saving for the rainy days" and "enduring the winter of your life" are but examples of many things that we tend to overlook. We learned these from nature itself. The changes in the weather and natural catastrophes have taught us to prepare, and most of all survive. What we have not really learned is living in during the good times.

Good times make us complacent, and sometimes irresponsible. We tend to forget what we have been through and the bitter lessons learned.

I will continue reading the news, bad or good, regardless if my wallet is empty or is bulging with money because the news reminds me of things that I am NOT supposed to do with my finances when good times come.

What is our take?

Again, on my metaphor of the weather, allow me to quote Pietro Aretino:

"Let us love winter, for it is the spring of genius."

With this in my mind, in the economic context means: let us value what this economic downturn brings, because it allows us to think of better ways of managing our personal finances.

We Live Beyond our MEANS

2009-02-06T12:41:00.000-08:00

We will not easily admit it, but most of us live beyond our means. No wonder when a financial crisis hits us, we panic.

We love to spend. Saving for the rainy days always goes to the bottom of the list.

Spending is fun! In fact, it gives us a certain sense of satisfaction. But the consequences of overspending is unforgiving.

But then again, we seem to care less, as long as we have the latest iPhone, the newest laptop model or a brand new car to boot. These things may make us feel good, however brief the feeling is or how shallow it is.

The point being, we love spending on things that do not actually add value on our way of living or lifestyle.

On the contrary, these things add undue strains on our personal finances and could even wreak havoc on our lives. No wonder, most of us are worried, afraid, and even confused about where this recession will lead us should it tarry longer.

Here's a reality check: according to Lauren Sherman of Forbes.com :

“We spend $1.33 for every dollar earned, according to the Census Bureau. We carry an average of $8,700 in credit card debt per household, according to the Federal Reserve. And 4.79% of our credit cards were delinquent at the end of 2008.”

So true eh! According to Sherman, there are 8 reasons why we overspend and live beyond our means. Here’s the list:

We assume our financial future is set. Which means we depend entirely on what our retirement benefits offer.

Retirement is expensive. It is! And the most difficult part of retirement is, you will be spending more while not generating an income for living.

We don't take advantage of what our employers offer us in terms of contributing to our 401(k) or any other retirement fund.

We forget about big expenses.

Underestimating a partner's income needs. Remember, with or without recession, job security is a myth. Your partner cannot hold on to that job forever. You should prepare for this inevitable.

We worry about things we can't control.

We abandon a volatile market too quickly.

Cheap and easy credit is readily available. We fill out almost all the credit applications or loan forms that come our way.

Not really a big list, but these are actually very basic things that we tend to overlook, and so we overspend and live for a day like a millionaire, spend the rest of our life like a pauper.

"Spending less than you make is what's important." (ibid.)

Don't Make Rash Financial Decisions in Response to the Stock Market

2009-01-14T12:13:00.000-08:00

The stock market is still very shaky. In fact, recession or not, the stock market will always be shaky. Hence, investing on stocks is a gamble. I have heard stories of many who made it rich overnight, and went on bankrupt the following day.

Here are some practical tips from Suze Orman, a renowned finance expert, that you might want to consider:

Price of Gasoline Increasing Again?

2009-01-06T20:18:00.000-08:00

Not all may have probably noticed it. Nevertheless, after the holiday season, the price of gasoline is steadily climbing by the cents.

“For six days in a row, drivers have been paying a few more cents a gallon than they did before Christmas. The change has been almost imperceptible for drivers who remember prices soaring above $4 a gallon last summer.

But if the price of gasoline continues rising, it may become another headache for consumers worried about their jobs and the dropping value of their homes and investments.” (read full story here)

Most of us have been using less of our cars to cushion the impact of fuel costs. I suggest that you continue doing that; because at the present rate of increases being affected that we seem to hardly notice and the ongoing war between Gaza and Israel, we are not still seeing the worst these recession is bringing. There is no reason to be complacent now. In fact, even during good times, our lifestyle should still reflect frugality.

My 2 cents.

Bank of America to Cut Up to 35,000 Jobs

2008-12-11T18:50:00.000-08:00

The financial meltdown that started a few months ago is slowly getting into the bigger barns of America. Congress has just reluctantly approved, in principle, the $15B bailout package for Detroit’s Big Three car manufacturers, and now one of the largest US banks, Bank of America is announcing a 35,000 job cuts? Sara Lefro reports,

“Bank of America Corp. said Thursday it expects to cut 30,000 to 35,000 jobs over the next three years, as it faces a deteriorating economic environment and tries to absorb Merrill Lynch & Co.

The final number could be even higher, analysts say. Charlotte, N.C.-based Bank of America said it hasn't yet completed its analysis for eliminating positions, and won't until early next year. The company and Merrill have about 308,000 employees in total, and the cuts will affect workers from both companies and all types of businesses.”

Further, to think that:

"Bank of America is considered one of the country's healthier banks, and its decision to slash so many jobs illustrates the breadth of the layoffs hitting the United States. The nation lost more than half a million jobs in November alone, and economists expect many more to come." (read the rest of the news here)

Time to brace ourselves for the worse folks; it is really belt-tightening times ahead.

Practical Approach to Financial ‘Wellness’

2008-09-16T19:20:00.000-07:00

As a matter of personal rule, I shun money borrowing. I work hard, and I do not want any debt to put unnecessary emotional and financial burden on me. Yeah. You read it right. Debt is not only an annoying financial burden to bear, but an emotional one. You do not want to work harder just to pay-off your debts, don’t you? But I know a lot of young professionals who burn themselves, having two jobs at the same time, in order to pay for their debts. That is difficult. I do not want my pursuit of excellence in job to be motivated by that. You can avoid that predicament. How?

Simple. Here’s my practical approach to financial ‘wellness’ (allow me to use that term): First, live a simple lifestyle. I know that urban or city living can sometimes exert undue pressure to cope up with the Smiths’ and Joneses’ –don’t! Second, live within your income. Easy said, than done huh. Try harder. Third, save for future unforeseen expenses or emergencies. Lastly, if you cannot really avoid borrowing, then get ONLY a short-term payday loan that you deemed you could easily pay soonest with your next two paychecks. Low interest rates, fast, and convenient. But, this kind of borrowing should be done sparingly, ONLY WHEN YOU NEED IT it, NOT WANT it. Get the first three simple advises right, then you do not have to go through the last advise. Here’s to your financial ‘wellness’.

Debt Settlement to Settle your Debts?

2008-09-16T19:07:00.000-07:00

The title sounds ironic huh? Nope. It is not.

Debts can be devastating not only financially and against your credit rating, but also morally and emotionally. Unsettled debts can cause undue worries and sleepless nights, and eventually stress. I cannot blame you. It is usually the common consequence of a mismanaged spending. It can be avoided with a fair amount of common sense and discipline. Sounds like I am nagging?

Here is the deal. You can always start on a clean slate without these financial woes. Go for a debt settlement service. This option is considered as one of the fastest and least expensive ways to get out of debt. What does it do? It actually offers debtors the opportunity to enroll all your unsecured debts into one program. The process is simple. You set up an account with a debt settlement agency, where you make payments fro all of your debts. Once these accounts have reached a certain amount, you and debt settlement agency will make an agreement with your creditor/s in order to pay off your debt/s. That easy. Then you are debt-free.

However, I understand that the hardest part is maintaining a debt-free lifestyle. I only hope you have already learned your lessons without those debts.

Money Problem is Stressful

2008-08-30T01:21:00.000-07:00

It is!

More often this is the leading cause of marital problems. When both ends do not meet, the wife will begin her ‘historical-hysterical’ how things should have been better if the husband did not purchase the new 72” wide-screen LCD TV. And the husband will throw a sarcastic rebuttal about the collection of shoes of the wifey. The exchanges in the courtroom (oh, basically the discourse will start from the dining room, then to the living room…then…) will last till the wee hours of the morning or till the whole neighborhood is awake. Then the husband goes to work and starts yelling at his staff. Typical huh. Was the issue settled? Nah! Were they able to think of a solution? Nah. But, they got stressed to the point of calling their divorce lawyers. This should not be the case.

Money problems can be abated if and only if we take the time to plan and manage our personal finances. It does not have to be stress full if we learn to discuss the issues objectively and come up with practical solutions. Easier said than done huh. But it is. I don’t find any other way.

Even cash emergencies can be avoided if we have saved at least 10% of our income on a monthly basis. Or if we preclude buying things that are not really needed at the moment. Not gratifying your desire at the moment can actually save your headaches, and probably heartaches in the future, cause by financial problems. Saving 10% of your income for example is quite a little amount compared to the unnecessary expenses to ‘pimp’ your car. Or better yet, taking the bus to work for at least twice a week would be enough to cover that 10% from the gasoline you did not use.

Anyhow, reality bites. As a consequence, from time to time (I hope it is not frequent ^_^) you stare at the ceiling and your almost empty wallet and think hard how you are going to stretch your money till the next payday. Then panic starts to set in. Then the vicious cycle begins, again.

Money problem is stressful when you fail to plan, and manage your finances. Take the little step to financial freedom today by learning to save, and by putting your priorities of the needs rather than the wants.

About Finance for Non-Finance Professionals | Why another blog on finance?

2008-08-29T10:09:00.000-07:00

Alright, this is my ABOUT page, I am NOR.

The title of this blog says it all, and let me reiterate: I am NOT a Finance Professional. Anyway, repeating the obvious has its own merits, at least in SEO perspective. I hope I get the attention of the search engine spider with that. Okay. Before, I drift farther from my intent, I know you’re asking why the outright confession. Honestly, this is my attempt to concretize from bitter experience what I have learned about finance management.

I am not an expert. I am still learning. What I will attempt to write here are lessons I learned, I am learning, and I am about to learn. Hence, my approach is like a co-learner. I will not pontificate. I will simply share, and your comments will be taken as new lessons too.

Other than financial wellness and money matters, I will be sharing my experiences (and knowledge) on blogging for money, internet marketing, small business management, and other practical tips that I may deem will add value to your reading.

So, that’s it.

Welcome to my blog and let’s get on with it.

Oh, by the way, you can start throwing your comments now. Also, before you leave, please do subscribe for updates (via RSS Feed or by email) will ya -just click that nice rss button on your right side.

For other concerns, I am all ears -feel free to . Thank you so much!