USAinDebt

Millions of Americans are seeing inflation in the price of gas and groceries, but they are being told that the heart of the consumer engine is spending. Some will even argue that in some areas, costs have dropped (like housing) and interest rates on loans have fallen, making it an ideal time to buy a home. But, for those struggling to put food on the table and make the long commute to work at the same time, these conflicting messages can be troublesome. If they continue to spend at the level that they can’t support, they may end up having to take a cash advance to help pay for daily expenses, instead of reserving payday loans for emergencies as they are meant to be used. This can put them further in debt, if spending is not curtailed, and new budgets drawn up to accommodate rising prices.

The first thing a budget can help with is figuring where all the money is going. It may surprise some families to realize that they are now making an additional car payment in the form of gas costs just to make it to work. If they aren’t keeping track of the grocery or the gas bill, they won’t be able to see where the biggest savings might come from. They can’t make decisions based on actual numbers and instead might opt for feel good economics instead of some needed hard choices.

Once a budget is drawn up, people know where modifying behavior will make the most financial sense. Maybe carpooling with your spouse and eliminating one car is the way to go to help you meet your expenses during times of high inflation. Maybe shopping at the big warehouse club is actually increasing your grocery bill because it is too far away and it costs more to get there. Maybe, you can find out which foods cost less and can be used to build a menu during the week without making people go hungry in your family. All the little things add up in a budget and can help you to keep your spending in line while continuing to take advantage of specials when they are available.

Would you pay money to lend yourself your own money? No? Well if you wouldn’t do so, why would you take an Refund Anticipation Loan?

It probably seems easy at first: sing a paper and walk out with a check against your coming refund. Yes but no! Your tax RAL will cost you much more than you can imagine. As an example, H&R Block’s RAL cost is about $230 for a $3000  refund. And you get that refund on a Emerald Card with 36% APR!

Such loan makes no sense. You are way better filing with e-file and getting the refund deposited directly into your bank account. It only takes about a week after the e-filing to receive your funds.

Tags: e-file | filing | hr block | taxes | ral

Decoding and properly understanding the fine print on credit card agreements is the foundation of your financial decisions. And if you want to make the right choice, make sure that you know what you are putting your signature under.

Fees. Annual Fee, Application Fee, Balance Transfer Fee, Late Payment Fee… Some credit cards are so overwhelmed with fees, that you credit limit can be entirely consumed by them before you even get a chance to use the plastic. Watch out for those charges! It’s a good idea to make a list of all the fees which your credit card carries in order to really understand how much exactly the credit will cost you.

APR. Most credit cards offer a low or 0% APR to their customers, but that’s just your initial APR, otherwise called Introductory APR. It is usually offered for 6 or 12 months, and after that period passes, you will be paying the regular APR. Then you also have a Default APR, which comes in effect when you miss payments, go over the limit or simply when your credit score goes down (“Universal Default”). You also may have up to three different APR’s: for cash, for balance transfer and for purchases.

Billing cycle. You can be billed bi-weekly, monthly, annually and in all kinds of other time incremental. Some banks even use double-billing cycle, where you have two due dates: one for your minimum payment and one for the entire balance.

Balance Transfer Terms. That 0% on Balance Transfers may come with its own Fine Print – for example 5% fee on the balance transferred or $2 per every $100 transferred.

Binding Arbitration. The credit card issuer is giving notice that if the cardholder has a disagreement with the creditor he or she can’t sue the card issuer in court. As a substitute, they must take the case to a private arbitrator or judge.

Identity theft has become more of a concern with the vast integration of computers and Internet into our financial matters. Years ago, when people used cash and online banking and shopping was not yet invented, identity theft level was way lower. Nowadays, when hundreds of millions transactions are performed online daily, we have to be careful more than ever. Following the simple steps below can ensure not just the safety of your personal information, but also the safety of your money.

1) Ensure that you have an Anti-virus software installed on you computer; it is supposed to run all the time, providing constant protection against viruses. A cheap and good antivirus you can buy from ESET (NOD32) or you can download a free one from AVG. Run a system scan at least once a month and make sure that the virus database is being updated.

2) You will also need a Firewall; Windows XP and Vista have their built-in Firewalls; You can also download the free Zone Alarm Firewall and install it.

3) In order to protect yourself from spyware and adware, install Ad-Aware (also free). Run a system scan at least once a month in order to keep your system clean.

4) Make sure that your Windows is fully updated with the newest patches and hotfixes: go to http://windowsupdate.microsoft.com and install the recommended updates. Check for new updates at least once per month.

5) Install CCleaner and run the clean-up wizard once a month.

6) Install Mozilla Firefox and use it instead of Internet Explorer. It provides better security!

7) Make sure that you are entering your information on the right websites. Hackers sometimes create mirror websites (’phishing’) which look exactly like banking websites and they may steal your log-in details. The address box should always display the correct address (ex. login.chase.com not 122.333.112.44 or chase.free-hosting.com) and it should always start with https:// (meaning that the connection is secure).

When shopping or banking online, look for the yellow padlock symbol in the lower right corner of your browser window. This will insure that your online session is in a secured environment and that the personal information you enter is protected

9) Protect your wireless network with a password and avoid connecting to unsecured wireless networks. Unprotected wireless networks can be tapped into and your personal information is at risk of being stolen and used inappropriately.

10) Keep your information secure: password-protect your computer and do not send any login or other sensitive information via email. Reputable companies will not ask you for your password through e-mail or over the telephone.

Tags: identity theft | antivirus | firewall | secure | banking | mozilla | credit | debt

As per the latest reports, Americans are  ’above their ears’ in debt - $48 trillion - and soaring. 9 out of 10 households in the US owe money - in mortgages, car payments, credit cards, student loans, medical bills, various payday, credit union and personal loans. And unless you are one of those lucky exceptions, you probably owe green. If so, read-on: here are your first golden steps in becoming debt - free.

When dealing with your debt, the first thing to do is to summarize your responsibilities. In another words, understand how much you owe. And in order to do this, you will need a couple of simple things: Microsoft Excel, Internet, a phone and a couple of hours of free time.

For starters, create a new Excel file and password-protect it. Go to Excel, click on “Tools” then “Options”, click on the “Security” tab and look for the box “Password to open”. This is where you are going to put your password. After you have typed the password, click on “Ok”, re-enter the password (for security) and voila, your document is protected. Save it.

Your next task to do is to type in “Creditor” into the first box (A1). Write “Owed” in B2, “Available” in B3, “APR” in B4 and “Minimum Payment” in B5. Save. Next, list the names of your creditors in the first column, one name per row. Save again. The next step is to contact each creditor that you have listed in the first column and obtain as much information as you can. Against the name of each creditor you should fill out what’s owed, what’s available, what is the APR on the credit and what is the minimum monthly payment. Save frequently to avoid loss of information!

After you have everything listed, it’s time to summarize your debt. You will be using Excel’s Auto Sum function for that. Let’s do it with the numbers in column#2, “Owed”. Click on the first number in that column, hold the “Shift” key on your keyboard, and then click on the next empty box underneath the last number in that same column. This way you should have selected all the numbers below the “Owed” column, plus one more empty box. When that’s done, click on the Auto-sum Button which looks like the Greek letter Sigma - “Σ”. This will add all the numbers that you have selected and display the result on the bottom. The great thing about Auto Sum is that if you change any of the numbers in the column, Excel will automatically re-calculate the result! Do the same for the “Available” and “Minimum Payment” columns. Save.

Let’s summarize what’s been done. You have just made the first step towards your financial freedom. You now know exactly how much you owe, what are you minimum monthly payments, how much all those credit lines cost you per month and how much credit you have available. Good job!

Tags: credit | debt | debt-free | loans | apr | autosum | excel

Making the right financial decisions can really make your life easier. When it comes to choosing credit cards these days, however, the right decision is not easy. There are many plastics out there, and they all come with all kinds of fees, APR’s, rewards and pages of terms & conditions.

The best way to pick a card can be summarized in a 3-step plan:

1. Educate.

What is APR? How do they calculate my minimum payments? How much will I have to pay per month if I owe $1000? What is a Balance Transfer? What is an Identity Theft Program Fee? It is really important to know the basics and the terms of the credit  because a smart consumer is an educated consumer. Here are a couple of articles that are going to be helpful:

- Understanding APR (Explains what really APR is, how it works and how not to get fooled by APR offers)

- 17 Hidden Credit Card Fees Revealed (Every credit card fee explained)

- What is FICO and Why Should You Care About it (Explains what FICO is and gives some advice on how to keep those score numbers high)

- Balance Transfers: Benefits & Drawbacks (Explains the possible pitfalls of Balance Transfers)

- How to Choose a Credit Card (Explains the different types of plastics)

2. Research.

There are a million websites out there that will help you with your research. You best bet is to figure out what are you looking for in a plastic: are you out there to collect point or you want to transfer balances? Write down your requirements and then compare the offers side-by-side.

- CreditCards.com (Great credit card comparison website)

- Bankrate.com (Compare The Best Credit Card Rates)

3. Negotiate.

If you have found your card online, and if you have some spare time, you may want to go one step further and call the bank. Talk to a customer care specialist and see if you can get a better deal. Very often supervisors have the ability to lower APRs and waive fees. 10-15 minutes on the phone can really get you a nice deal and save you green!

  Tags: credit | credit card | money | loans | bills | apr | balance transfer

Have you ever thought what would you do if you suddenly wake up as a millionaire? People usually follow the same answer pattern when asked that question: Pay off bills, travel around the world, buy a house, buy a car, quit work. Invest the money in a savings account and live off the interest. Interestingly enough, it sounds selfish. Looking at what individuals usually say, they rarely mention their families or friends. Nobody says that “I will send all my grandparents to Hawai” or that “I will buy my best friend a gift he/she always wanted”. The point is, do people become selfish when they have money? There is a Citibank commercial that has a really nice motto: “The best things in life actually aren’t  things” Is that so?

Tags: lottery | lotto | millionaire | money | bills

Companies spend a lot of money on advertising their products to the public and unfortunately that good advertising often works: people tend to buy products that they have seen on TV or read about in the magazines. Sometimes, however, those products are not the best buy. They are expensive because of the brand they are sold under at the same time they are no different that the rest of the products on the shelf. Generic, or otherwise called store brands can often save shoppers lots of green.

A good example is CVS. What does a regular CVS customer buy? Cosmetics, medicine, household supplies. So let’s get two separate carts and shop. Shampoo, toothpaste, face cleanser, pain reliever, cotton swabs.

Cart 1: contains Head & Shoudler’s Dandruff Shampoo, Classic Clean; Crest Vivid White Night Toothpaste; Clean & Clear Oil-Free Daily Pore Cleanser; Advil Ibuprofen Coated Gel Caplets; Q-tips. Total for this cart: $35.00.

Cart2: CVS Dandruff Shampoo 2 In 1, CVS Bright White Whitening Toothpaste, CVS Oil Free Acne Cleanser,Pain Relief Rapid Release Gel Caps Extra Strength, CVS Cotton Swabs Flexible Plastic. Total for this cart: $13.39.

Looking at the above, it is easy to see that the CVS store brands have saved us $21.61, which is a nice piece of change. Worried about the quality of what you are buying? Compare the ingredients and you’ll see that they are 100% identical in most products! Why pay for the brand name when you can have the same for less?

Tags: cvs | save money | store brands | generic

If you happen to be in debt then the likelihood is that you consider credit card to be a dirty word! Credit cards account for the majority of debt in this country at the moment, but did you know they can also help to get you out of debt?

The latest credit card trend is towards balance transfers. Transferring your credit card balances from a high interest card to one of the many interest free credit cards that have fixed nine, twelve or eighteen month offers can knock hundreds of dollars off your bills and give you a little breathing space to get your credit card balances cleared. But if you are not sure where to look for these offers then a website like About Your Money can help.

About your money is a comparison site that has access to plenty of the latest interest free credit cards and the related offers. The site is really comprehensive, complete with a comparison table and a guide to help you choose the interest free credit cards that will best suit you. If your debt is more extensive though, you might want to take a look at the personal loans section instead.

Now is the time though. With 2008 approaching and bringing a fresh start with it, now is the time to look to clear your debt.