Mend Your Money Mistakes

Don't tell me you haven't made any money mistakes - better yet, don't tell yourself you haven't made any money mistakes.

Everyone makes them and I don't mean just the big ones - on a day-to-day basis, we are all guilty of making money decisions that are not supportive of our bigger vision for our life.

Let me start then, by sharing with you my big mistakes from last year because a big part of mending money mistakes is to know what they are.

Mistake #1 - Not Looking After Yourself 

I did not take enough time to look after myself. While I love my work and almost everything about it, believe it or not there are other things I enjoy doing.

Because there is always something fun and exciting and necessary to do, I did not take the time to exercise enough, go to bed early or take time out to just be.

I know that last year I was more a human doing than a human being, and that if I continue on this path, I will wear myself out and end up no good for anyone.

All work, even enjoyable work, is not a balanced life or sustainable lifestyle.

Mistake #2 - Neglecting Time With Family and Friends

I did not spend as much time with my family and friends just for fun.

I am extremely fortunate because I work from home and my family is around all the time.

We make an extra effort to plan travel together, and while we probably spend as much time together as we can given work, school and other social commitments, we did not take the time to just 'hang out' together and play a game, watch a movie, go for a hike, or bike-ride or putter around the garden.

Mistake #3 - Failing to Follow Up and Stay in Touch 

I did not communicate enough with my clients and prospective clients. And, I did not stay in touch with all the amazing people I have met throughout the year.

Throughout the day, there are always lessons and situations that come up that are valuable teaching opportunities.

For some reason, I have not taken advantage of all the amazing technology available to share these thoughts with you.

It is one of my commitments for this year - to be more consistent with the blog, audio, video and written communication.

Mistake #4 - Trying to Do Everything On Your Own

I continue to fall back on an old habit - trying to do everything myself.

This isn't because I don't have great people to help me, it's just that for most of my career it was me.

I was self-employed and if something was going to get done, it was going to happen because I made it happen.

Well, in a corporate environment, if something is going to happen it's because the team made it happen.

Mistake #5 - Starting Something New Before the Prep Work is Done

And, the big one, I started something before something else was done.

This mistake needs to be written into an entire book.

Let me summarize by giving you an example, because in 2007, I experienced the money mistake that I see again and again and again with my clients and the people I meet, just in different circumstances:

I put a budget together, but before the money was completely pulled together, I marched forward.

That single mistake has cost me stress, money, lost opportunities and the most valuable thing of all - time.

Starting something new before completing something else is a common money mistake.

It's the mistake that people make when they start saving for something - they buy it because it goes on sale, not because they have the money for it; and it's the mistake people make when they retire - they leave work because they have reached a certain age - not because they have arranged their finances to live a financially independent life.

Find the Right Sequence 
This mistake could be the biggest of all that needs mending for most people - to do things in the right sequence.

We have to look after details in the right sequence.

We have to look after ourselves before we can look after others, and we have to look after the details before we can realize the big picture.

Don't Slip into Crisis or Windfall Planning 

The out of sequence financial plan is everywhere with the constant tendency to jump the sequence and go right for the quick fix and to do the urgent and immediate activities rather than the not urgent but important ones.

It's constant and yet we all know the sad statistics of lottery winners who end up with very little money left, if any, within a few short years of their winnings.

That same lure is what we call windfall planning.

It's why people who receive inheritances, divorce settlements, and debt consolidations continue to struggle with money.

Take Stock of the Good You Have Done 

When we focus on what we did wrong and at the same time try to set goals, we are just creating a bigger gap between where we are and where we want to be where the bridge to connect the two is a flashing light telling us "we'll never make it because we're no good - look at all the bad things you did before, what makes you think you can get to the other side and have those goals?"

So while it's extremely important to be aware of your shortcomings when mending money mistakes, and setting and writing new goals, it is even more important that you take stock of what good you have.

And that good becomes the first step of the sequence that connects your current situation to your goals and dreams.

To start the year off and mend your money mistakes, take stock of these important first 3 steps - in sequence:

1. Where are you today (what is good and what can you do better?)

2. Where are you going (what are your goals and dreams and why?)

3. What do you have to work with (specifically, what financial and non-financial resources do you have to build your bridge with and mend your money mistakes?)

And lastly, step 4 would be to ask for support... so, how can we help? 

Life Insurance: How much is enough?

The Two Approaches to Setting Life Insurance Policy Amounts 
You can use one of two approaches to estimate how much life insurance you should buy: the needs approach or the replacement-income approach.

Using the needs approach, you calculate the amount of life insurance necessary to cover your family’s financial needs if you die.

Using the replacement-income approach, you calculate the amount of life insurance you need to equal the income your family will lose. Let’s look briefly at each approach.

You need how much? 

Using the needs approach, you add up the amounts that represent all the needs your family will have after your death, including funeral and burial costs, uninsured medical expenses, and estate taxes.

However, your family depends on you to pay for other needs, such as your child’s college tuition, business or personal debts, and food and housing expenses over time.

The needs approach is somewhat limiting.

The task of identifying and tallying family needs is difficult, and separating the true needs of your family from what you want for them is often impossible.

Replacing Income 

Using the replacement-income approach for estimating life insurance requirements, you calculate the life insurance proceeds that would replace your earnings over a specified number of years after your death.

Life insurance companies sometimes approximate your replacement income at four or five times your annual income.

A more precise estimation considers the actual amount your family members need annually, the number of years for which they will need this amount, and the interest rate your family will earn on the life insurance proceeds, as well as inflation over the years during which your family draws on the life insurance proceeds.

Note: Do remember as you quantify the income you want to replace that Social Security provides generous survivors benefits if you’ve qualified.

Calculating Replacement-Income Amounts with Excel

If you’ve got access to a computer running Microsoft Excel, the popular spreadsheet program, you can use your computer to calculate the amount of insurance you need to replace a specified number of years of income.

Suppose, for example, that you want to buy enough life insurance to replace the income from a $50,000-a-year job for 15 years.

If you figure your family will earn 5% on the life insurance proceeds should the worst case scenario occur, you enter the following formula into a cell in an Excel workbook to calculate the replacement income life insurance amount:

=-PV(5%,15,50000)

Excel returns the formula result 518,982.90 indicating that you would need roughly $520,000 of life insurance, invested at 5%, to payout $50,000 a year for 15 years.

Two Calculation Tips 

If you want to factor in inflation because you’re trying to replace income over a long period of time, you should use a real rate of return rather a regular, or nominal, rate of return.

To calculate a real rate of return, subtract the inflation rate from the interest rate in the formula.

For example, if you expect 2% inflation, you could replace the formula shown earlier with this formula:

=-PV(5%-2%,15,50000)

Here’s a final calculation tip:

You probably want to round up your number. For example, if the formula provided earlier returns the value 518982.90, you might want to round up this value to $600,000. Or $750,000.

Editor's Note: Financial Services Online provides a free online calculator that uses a combination of replacing income and needs approach in helping to determine the amount of life insurance cover you may need.

16 Simple, Everyday Ways to Save Money

Here are 16 of the simple, everyday changes that have worked for us.

1. Use a coupon, absolutely whenever possible. I was really surprised by how many money-saving opportunities are out there when I knew where to look.

For local purchases, get an “Entertainment Book” each year and you will save on those inevitable everyday expenses ranging from dining out to accommodation and admission to movies, theme parks, etc.

For online purchases, stick to the reputable retailers. You certainly will not save any money if you are the victim of fraud or if you are simply unable to return an item. And before you start shopping, always look for a coupon code that will allow you to save on your purchase. In the past, many online retailers sent out promotional codes as a series of letters or numbers that could be entered at checkout. Now, many retailers use a button or text link that automatically activates your coupon when you click through, so it is often a good idea to find the coupon first, before you start to shop.

2. Shop around. The internet is an amazing tool for researching products and retailers, as well as for comparison shopping. We make nearly all of our large purchases online. It is also important to know where to shop. For holiday gifts, plan ahead and check out the big online discount stores. Many offer significantly reduced prices on trusted brands. And you can get great delivery rates too, even on large gifts. I once had an enormous game table shipped to me for $2.50.


3. Keep a running list of gift ideas for your loved ones. I have found that when I am confident that a gift is perfect for the recipient, I am much less likely to overspend. But that kind of inspiration rarely hits me during the pre-Christmas rush, so I need to keep a list going the whole year through.

4. Budget. Of course, it is important to know what you are really spending. For years, the budget I had in mind was really more of a “wishful thinking” budget. But this quickly led to debt. It pays to get realistic. Whether you use a computer program or a simple ledger book, make sure you know where your money is really going.

5. Save for the future. Take 10 percent of your income and put it in savings, right off the bat. Now you know what you need to cut back on (or how much more you need to earn) to shore up the deficit.

6. Plan ahead. You will want to make sure you have money in the bank for emergencies. Experts say you should have three to six months of living expenses set aside, for those just-in-case times. It sounds like a lot, but start socking away money each month, and it will add up fast.

7. Get organised. When your home is organised, you will be less likely to spend money on items that are already hiding in the nether reaches of your closet and drawers. The same goes for your refrigerator and kitchen cupboards. Purge and organize before you shop.

8. Simplify. There is a certain romance to the “simplify your life” movement. And having too much stuff really does weigh us down. Take a look at everything in your home. If it does not add joy, beauty, meaning, or usefulness to your life, give it away. And when you are tempted to buy something new, it must pass the same test.

On a quarterly basis, go through your house and ask yourself these same things again. Go through your closet, attic, garage, and basement and purge those items that do not add genuine joy, beauty, meaning or usefulness to your everyday life.

9. Reduce, reuse and recycle. A simple lifestyle, for me, is about reducing my urge to over-consume. It is about being kind to the environment. It is about spending less money on material things, so that I have more time and money to spend on memories with my family. Make changes that will help the environment and your purse at the same time. Install water saving kits on your toilet. Write on the back sides of paper. Use reusable containers in your lunches. All these little things really do add up, and it is important to show our children how we can all be part of the solution.

10. Shop without your kids. I know that if I get a shopping cart at Coles and I do not have a list, I will spend $150. If the kids are with me, I will spend even more. This is another reason it makes sense to do your shopping online. You are less likely to purchase the incidentals.

11. Make sure that your credit card is paying you back via an incentive program. I found a credit card that allows me to earn points on my daily purchases toward our annual vacation trip, including airline miles and hotel accommodations. Since most of my expenses each month are incurred at the grocery store, I found a card that rewards specifically for these types of purchases. Of course, you will need to make sure that you are paying off your balance each and every month. Paying a high interest rate on your credit card will quickly negate any savings you accrue on your incentive plan.

12. Lower your interest rates. If you are carrying a balance on a credit card, give the credit card company a call to see if they will give you a lower rate. Sometimes, it is just that easy.

13. Shop around for insurance. The money you pay for car, home, life and health insurance can vary greatly. Do some research to find out if you are getting the best rate.

14. Be wary of the influence of TV commercials and print ads, especially on your children. We hear fewer cries of “I want that!” when we keep our kids programming to those channels rely less on advertising dollars, such as the ABC and some pay TV channels.

15. Play “Time Warp.” This is a technique I first learned from “My Monastery is a Minivan,” by Denise Roy, and I use it quite a lot. It goes like this: When you are tempted to make a purchase, mentally fast-forward through the life of the item. For example, in her book, Roy thinks she needs new candleholders. She imagines spending time at the mall to find them, soon having to clean them, and then, years down the road, packing them in the giveaway box. She shirks the purchase and soon rediscovers the heirloom candleholders that are packed away right in her own home.

I like to play this "fast forward" technique in reverse, too, asking: What new clothes did I buy last season? (Sometimes, I can not remember). Where are those "I have to have it" items now?

16. Keep your mind on abundance. When you are thinking about money, it is really important to get out of the poverty mindset. Too often, when we are focused on saving money, we are living from a perspective that focuses on lack and scarcity, which tends to bring about more of the same. It has been really helpful for me to make a conscious effort to see the world as infinitely abundant and to rest in the notion that my needs will be taken care of. This is generally a simple matter of thinking more about what I *do* have than what I do not have.

All my days of penny-pinching have certainly proven to me that it truly does not take money to make us happy. Many of my fondest memories have occurred in the smallest homes. My child’s favourite playthings tend to be the inexpensive items that were never designed to be toys at all.

And it is the simple, everyday pleasures that are the sweetest, when enjoyed together.

Create a Personal Budget in 7 Easy Steps

If your financial situation is out of control it may be time to create a personal budget. This could be the decision that gets your finances back on track because it takes back control of what your money is doing.

You want your money to work for you not your creditors, which is exactly what it is doing if you are living payday to payday. Instead of paying interest to them why not make it yourself?

A personal budget will do many things for you.

The most important thing it does is let you make informed decisions about how you spend your money.

It will show you exactly what you income and expenses are and lets you make adjustments to ensure a sound financial future.

Other then taking the time to get started, creating a budget is relatively easy.

You will need a notebook or legal pad and a pencil. Draw a line down the middle of your paper, label one side income and the other expenses, and you are ready to go.

1. Gather up your last three months worth of pay stubs and any other records that show income. Total them up and divide by three to get your average monthly income. That number gets written down at the top of the income column.

2. Now for the fun part. Gather up all your bills, credit card statements, and checkbook register and start itemizing a months worth of expenses in the expense column. For those bills that fluctuate each month you can use the three month method as used in step one to get a solid average. Add all those expenses up and write the total down at the bottom.

3. This is the step most people fear. Compare your income to your expenses and see which one is more. If you expenses are higher then your income then you have a problem that needs to be fixed. Chances are you are making up this shortfall with credit of some sort. You can't build a sound financial plan if you are in debt, it's that simple.

4. Now that you have everything written down it's time to look it over carefully. Target unnecessary expenses and start cutting them. A budget gives you the power to free up money that can be used for more important tasks.

5. You can also use your newly created budget to start prioritizing your debts and which need to be paid off first. This gives you a game plan to get out of debt while actually being able to see positive results, which is a major part of good money management.

6. As you get better at budgeting you can start to refine and track your long term financial plans. You can manage savings accounts, investments, emergency funds, and retirement accounts using your personal budget.

7. Patience is required when first starting out because it won't work perfectly those first few times. Most people need 3 or so months of budgeting practice before they start to really get the hang of it.

Your financial future is in your hands. Nobody can build it for you.

If you create a personal budget you will take the first step to attaining your financial goals.

Teaching Kids About Budgeting

If you have kids, you've probably already figured out that teaching them how to handle money is one of the most important skills you'll ever teach them.

As a parent, there are two critical areas for you to take action to help your kids the most when it comes to money and budgeting.

1. Manage your money in a responsible way. 
Create a simple budget that works for you. Practice good budgeting habits - know how much you have to spend before you spend it.

By spending within your self-made budgeting guidelines, you will demonstrate a confidence and security about money that your kids will notice and hopefully emulate later in life.

Make a habit of saving. If you don't follow a budget, don't save money and you frequently overspend, you will have a great deal of stress about money which your kids will easily pick up on.

Which lesson do you want to teach your kids about money? Money is stressful? Or, money is to be respected and commanded in a responsible manner, bringing a sense of confidence and calm?

2. Directly teach them about budgeting and saving money early (before they become teenagers.)

Some experts disagree about the effectiveness of allowances and money for chores, etc. - but don't get distracted by this.

How your kids 'get' money is quite a different thing from what they do with it once they have it.

Help your kids to know the pros and cons of the different things they can do with their money.

Kids aren't generally known for having a long attention span, especially when the topic is boring, so keep your message simple.

Encourage them to save a portion of any money they get; a great idea for reinforcing this is to match each dollar they save.

Also, gradually help them to understand the different places money flows to in the adult world.

For example, explain the sales tax on the receipt for the shirt they just bought - that it is used to pay for roads, schools, etc.

Or, if you want something a little more fun for them, playing a board-game like Pay Day or the computer game The Sims can help a lot by giving them a frame of reference for understanding some of the basics of where money goes.

However, actively helping your kids to build a habit of saving money whenever they receive it, in the real world, is probably one of the best things you can do to help them build good money skills.

Explaining the pitfalls of using credit is valuable too (as well as minimizing your own use of it!), but emphasizing savings is probably more effective at a young age since it's something they can do now.

Teach them that by having a lifelong habit of saving money, they won't need to borrow as much, allowing compound interest to work for them and not against them.

When your kids get their first part-time job, continue to extend your reinforcement for saving, but now add in a proper budget.

After showing them the basics of listing their expected income along with their desired expenses and savings goals, reward them for creating their first budget.

Be creative in offering various incentives for them to stick to their budget.

By building on the savings habit you taught them earlier on, and introducing them to the concept and value of budgeting, you will have done a great deal to help your children grow into one day being responsible adults.

Six Tips for Money-Making Hobbies

You can make money from your hobby.


Whether you knit, or write, or make photographs, or grow a vegetable garden, or tinker with cars, or build web sites, or collect ancient coins — you can make money from your hobby.
I’m not saying it’s possible to get rich by playing your violin at weddings, or by weaving baskets from pine needles, but earning money from a hobby is a nice way to get paid for doing something you would do anyhow.


This article is the first in a series that will explore how to turn a hobby into a source of side income. In the weeks and months ahead, I’ll describe general best practices, discuss potential pitfalls, and provide case studies culled from my friends, and from the stories of readers like you. (If you’d like to share your experience, please drop me a line.)


First, by way of introduction, here are some ground-rules for making money from hobbies.


Focus on something you love

Pursue something you’re passionate about. Choose a hobby that you enjoy, and find a way to make money from it. Don’t choose a hobby simply because it might make money and then dive into it with that aim in mind. You should be doing this hobby because you love it; any side-income should be secondary.


I love to write. I was struggling with debt. I began to read personal finance books, and then to summarize what I’d learned for my personal web site. From this, Get Rich Slowly was born. Now I make over a thousand dollars a month writing about personal finance. But I didn’t start this for the money — I started this because I was passionate about the subject.
Keep it fun. Don’t let it become a chore.


Be creative
If you’re interested in making money from a hobby but don’t know where to start, think outside the box. What skills do you have that others don’t? Define the term “hobby” broadly. Find something that you can do that most others cannot, something for which other people might be willing to pay.


At my day job, I have a customer whose wife loves to cook. She turned this hobby into a part-time job as a personal chef. She prepares meals in advance for wealthy clients. She spends a few hours a day preparing a week-long menu for people who pay her handsomely for her time.
I have a friend who likes to travel. One day he discovered that he could subsidize his journeys by writing about the places he visited, and by taking photographs. Now every couple of years he takes an all expense paid vacation. He’s doing something he’d do anyhow, and it doesn’t cost him a dime.


Don’t force it

Your hobby will not make you rich. In most cases, it won’t even net you enough to allow you to quit your day job. It’s quite possible, however, to earn enough money to make the hobby self-sustaining, to keep yourself in new tools and equipment.


My brother builds speakers and works with audio equipment as a hobby. He makes some money at it. (“Spending money,” he says.) Jeff notes, “It’s not hard to make money from a hobby. What’s difficult is trying to turn it into an actual business. Moving from a hobby to a business is a pain-in-the-ass.”


Often when you try to take your hobby to the next level, the joy goes out of it. Suddenly the extra income just isn’t worth it. When I tried to turn my computer-building hobby into a business, I hated it. There’s a balance to be achieved, and if you can find it, you can have a fun while earning extra income.


Don’t underestimate your ability
It’s easy to discount your abilities. When you truly love something, your prolonged experience can give you skills and knowledge that you don’t appreciate.


For example, I have a love for early 20th-century American pop culture. My brain is filled with facts and anecdotes about once-famous recording artists. I sometimes find myself under the impression that everybody knows who Billy Murray was, or is familiar with the song “Ukulele Lady”. But this isn’t common knowledge — it’s specialized.


The same concept holds true for you and your hobby. Know a lot about Napoleonic warfare? Start a blog about Admiral Nelson. Spend time tinkering with bicycles? Open a small-scale bike repair service. Not everybody knows what you know. Don’t sell yourself short.


Market yourself

This can be difficult. In order to actually earn income, you need customers. But just as most people have a tendency to underestimate their abilities, they also tend be uncomfortable with self-promotion.


There’s no shame in mentioning your money-making hobby to friends, family, and neighbors. You needn’t be pushy. Just mention it at natural points in the conversation. If you’ve decided to do some woodworking for cash, mention this when your uncle mentions he wants to buy a new bookshelf.


Marketing can be subtle, but it’s an absolute necessity if you hope to earn money from your hobby. People need to know you’re available before they can hire you.


Hone your skill

Practice, practice, practice. The more time and energy you’re willing to devote to your hobby, the better you will become. The better you become, the more likely that you’ll be able to earn money from it.


Photography is a terrific example. If you’re willing to make a hundred images a day, you can improve your skills quickly, especially if you teach yourself about composition. You may never become a professional photographer this way, but you can develop your skill to the point where you can sell images to stock photo agencies, or enter (and win) photography contests.
Some people are born with natural talent. Most of us have to work at it.


Conclusion
Why should you care about making money from hobbies? Remember: the wealth equation has two sides. You accumulate wealth by reducing expenses and by increasing income. Often we only focus only on our careers when it comes to “increasing income”. But there are other ways to make money. One of the best is to harness a hobby.

18 Personal Loan Tips

If you're thinking of borrowing money to buy a car, boat, debt consolidation, home repairs, medical bills or anything else for that matter, here are some red hot tips to make the process much, much easier.

1. Avoid unsecured loans if possible

Avoid using unsecured personal loans if you can put up some security for your borrowings. This will get you a lower interest rate. A home equity loan, or redraw of extra repayments, allowing you to borrow against the equity built up in your own home or an investment property, is the best option of all, and could get you finance at up to 5 percent less than a personal loan.

2. Be honest in loan applications

Be honest about why you want the loan. Your bank may be able to offer you a loan option that better suits your circumstances. There are an increasing variety of different types of personal credit these days; car loans, commercial loans, leases, home equity loans, are just some of the examples.

3. Can't get a standard loan? There are alternatives

If the banks, building societies and credit unions won't lend to you because you're self employed, newly arrived in the country or have a poor credit history, consider the booming non-conforming and "low doc" loan market. A number of non-bank lenders offer loans which especially cater for this type of borrower. The interest rates on non-conforming loans are generally higher but come down after a few years of on-time repayments.

4. Check your statements for errors

There are claims that more than 50 percent of loan statements contain calculation errors. Simple mistakes, like the entry of the incorrect balance or the application of the wrong interest rate at the wrong time can be costly and mostly favour the lender. We all make mistakes, even bank computers make them and that's why borrowers should keep a close eye on loan statements. Various software for your home PC is available that can run a check on your statements.

5. Consider smaller lenders too

When shopping around for a car loan, consider community banks, credit unions and other smaller financial institutions which might be more approachable, and offer lower interest too.

6. Do you have to take out a personal loan at all?

Think twice before borrowing money without security. You may have a better option already available; home equity extension to your home loan, a new loan that uses your property as security, a credit card, or even a rich relative!

7. Do you qualify for a 'relationship discount'?

Relationship discounts are available from banks and credit unions for those borrowers who consolidate a range of banking business with the one institution. Home and personal loan interest rate discounts, term deposit bonuses, savings account fee waivers and credit card annual fee waivers are commonly offered.

8. Don't just take the dealer finance

        Don’t accept loan or lease finance offered by a car dealer before comparing the offer with        finance options offered by your bank or other credit providers. Dealer finance might be less hassle but you could well end up with an expensive loan and more restrictive terms and conditions. The same goes when buying furniture or any consumer goods where finance terms are offered.

9. Don't make multiple applications

Don’t fill out applications at several financial institutions and have all of them checking into your credit history. This can make you look desperate and lower your credit score.

10. Don't rely solely on comparison rates

All lenders must now include "comparison rates" in advertisements for their home loans and personal loans to help consumers get a feel for their total cost - fees and the interest. Don't rely solely on comparison rates when choosing a loan and beware of their shortcomings. They only take into account fees and interest rates, not the features and how suitable the loan is for your circumstances.

11. Have the right information when applying

What you will be required to supply in any application for lease finance will depend on whether the lease is for personal or business use.

Personal lease applications will require:

·        proof of current employment

·        income details or tax returns

Business lease financing requires more detailed information and may include your:

·        balance sheet

·        tax returns

·        cash flow projections

·        business plan

Confirm with the lender what you will need before the interview.

12. Have you considered a credit card?

Consider also a credit card as your source of credit. Interest rates are generally higher but credit cards are easier to secure and offer greater flexibility of repayments.

13. Honesty counts

Be honest about why you want the loan. Your bank may be able to offer you a loan option that better suits your circumstances. There are an increasing variety of different types of personal credit these days; car loans, commercial loans, leases, home equity loans, are just some of the examples.

14. Keep accurate records

Keep accurate records of your deposits and ATM transactions. It is also wise to keep copies of your loan application and approval documents in a safe place.

This is the best way to avoid hefty fees which may be charged by a bank when its customers want to see copies of their cheques or loan files.

15. Know what interest rate applies

When offered car finance, either lease or loan, always be sure you know what interest rate applies. Lenders often ‘sell’ you their finance packages by quoting the monthly repayments only. This may disguise a high interest rate.

16. Look beyond the banks

Get a feel for what's on offer across the wide range of financial providers around these days. Credit unions, building societies, mortgage originators, community banks and boutique online or telephone banks may offer better interest rates or lower fees than the big banks because they are anxious to win new business or they are non-profit organisations.

17. Try lenders with whom you are a regular customer

Take advantage of the human factor. Being a familiar face may earn you some slack if your credit background is smudged.

18. Understand what's on offer

Is the interest rate fixed or variable? What up-front, annual or ongoing fees are charged?

Useful Tips on Personal Loan

Here are some useful tips on Personal loans. You can find personal loan providers everywhere. Supermarkets, utility companies, junk mail, television, and magazines are only a few of the places where you can look for personal loans. However, with so many places to choose from, where do you start?

A personal loan is an amount of money which you borrow from a bank, building society or other financial institution. Ordinarily, you will receive a lump sum. In return, you agree to make regular repayments, usually monthly. Assuming you have taken out a repayment loan, some of the money you repay will go towards servicing the loan and the rest of your payment will be used to pay off capital and reduce the outstanding deb

t.

A personal loan can be a good option if you have a number of debts which you wish to consolidate into one loan. In doing so, you ought to be able to simplify your affairs and often reduce the overall cost of credit.

Banks, building societies and specialist finance companies all offer personal loans, so you will need to shop around. Different lenders have different preferences when deciding which borrowers to take on. As a borrower when youre considering one deal with another, make sure youre comparing like with like. The interest rate to look for is the Annual Percentage Rate (APR).

The APR (Annual Percentage Rate) is a method of providing a true comparison between different personal loan interest rates. It shows the true interest rate of the personal loan you are being offered.

The lower the APR on a loan the better because it means you have less interest to repay - so the loan is cheaper. Interest rates vary. And, its worth bearing in mind that some lenders are only interested in lending to people whom they regard as a low risk. These people may secure lower interest rates

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Lenders vary in their approach, theyll want to ask personal questions about your finances and your future plans before making up their mind on whether to lend and at what interest rate.

If you cannot pay back the loan for whatever reason, talk to your lender at the earliest opportunity. Theyll want to consider carefully your individual situation. If they reasonably believe your financial situation may improve, they may be prepared to suspend loan repayments for a while or extend the term of the loan. In the final instance, they can insist on the debt being repaid.

Article Source: EzineArticles.com Here are some useful tips on Personal loans. You can find personal loan providers everywhere. Supermarkets, utility companies, junk mail, television, and magazines are only a few of the places where y. Article on useful tips on personal loans by john mussi  by John Mussi

IDBI Home Loan

Home, sweet home, built out of your dreams. A place where you return after a hard day's work and relax, a place where you share precious moments with your family. A place that gives you a sense of belonging. IDBI Bank helps you realise your long cherished dream of owning your home through hassle free and customer friendly home loans.

Presenting IDBI Bank's ultra flexible home loan you have been looking for. We realise what owning your home means to you and your family.

You can avail of the Home Loans for constructing a home, purchasing a ready built house / flat, residential plot and even for re-financing existing loans you may have availed from other banks or housing finance companies. Click here to apply.

Advantages of IDBI Bank Ultra Flexible Home Loans

• Maximum Funding
• Flexibility of choosing between Floating or Fixed interest rate
• Attractive rate of interest
• EMI on daily reducing balance
• Personalised doorstep service
• Simple documentation
• Legal and technical assistance
• Balance transfer facility
• Reassessment and adjustment of applicant's loan eligibility in case of change of income and residence status

Features

• Tenor of a home loan can be up to 25 years for a resident individual whereas for NRIs the maximum tenure is 15 years subject to maximum age of 60 years at maturity.
• Loan can be applied for a maximum of 90% of the property value subject to credit discretion.
• Security for the loan is a first mortgage of the property to be financed, normally by way of deposit of the title deeds or such collateral security as may be necessary.
• Title to the property should be clear and free from encumbrance, i.e., without any pending legal litigation adversely affecting the ownership of the property.
• Other parameters considered include an account of your age, income, number of dependents, financial stability and co-applicant’s income.

Tax Benefits
As per the current finance bill you can get:

• A maximum deduction of Rs. 1,50,000 on your income towards interest paid on your home loans u/s 24
• A maximum deduction of Rs. 1,00,000 on the principal repaid u/s 80 CCE
The above benefits are available subject to you fulfilling certain conditions, for which you should refer the IT Act 1961

Citi Bank Education Loan

Overview

Power ahead in life with higher educational qualifications  

           
We acknowledge the importance of education
Citibank Education Loan gets you an education without any financial worries. Education is one of life's most important investments that should never be hampered with a financial dilemma. Let Citibank take the financial burden out of the equation so that you can focus your attention on what matters most - education.

For Local & Overseas Studies
We can alleviate your financial worries be it local or overseas studies.

Competitive interest rate
Enjoy competitive interest rate and cost savings. You are charged ONLY on the disbursed and outstanding amount.

Flexible repayment plan

Option 1        
Standard Repayment Plan allows you to pay monthly instalments (principal and interest) with ease after the loan is approved and disbursed.

Option 2
Deferred Repayment Plan allows you to defer the loan principal repayment until after the course of study. You will need to pay only the monthly interest on your loan after the loan is approved and disbursed. Monthly installments (principal and interest) will commence after completion of your course of study.

Highest loan amount
You can borrow up to 6 times of your monthly gross income or up to S$150,000, whichever is lower. (Up to 8 times may be allowed for overseas study, only for standard repayment plan)

Up to 3 applicants
Obtain your desired loan amount either as an individual applicant or with up to 3 applicants. Yourself or your immediate family members may apply along with relatives & friends. No guarantors required.

Fast loan approval
We can approve your loan application within 1-2 working days upon your complete submission of documents.

Repayment convenience and disbursement convenience
Choose up to 9 years to repay your loan. Draw down your loan fully upfront or progressively during your course of study.

Qualifying criteria and what are relevant documents needed

Applicable to all Main and Joint Applicants

Qualifying Age-         21- 55 years old
(If you are less than 21 years of age, or not working, please get your immediate family members or relatives to apply on your behalf)

Nationality     Singaporean or Permanent Resident (If you are a foreigner, please get your immediate family members or relatives who are Singapore Citizens/ Permanent Residents to apply on your behalf)

Qualifying Income At least S$30,000 per annum (For students not earning or earning less than $30,000 per annum, a nucleus family member earning S$30,000 per annum is required)

Qualifying Length of Employment period  
Applicants must be in the current job for at least 6 months if annual income is below S$24,000 per annum
No minimal length of employment is needed if annual income is at least S$24,000 per annum
For Self-Employed: Applicants must be in the same business for at least 2 years
Relevant Income Documents

For Salaried Employees
Latest Computerised Payslip or
Latest 6-month CPF Contribution History or
Latest Income Tax Notice of Assessment

For SAF and All Uniformed Groups
Latest Computerised Payslip or
Latest Income Tax Notice of Assessment
           
For New Employees
Appointment Letter and
Latest 6-month CPF Contribution History
             
For Commission/ Variable Earner
Latest 6-month CPF Contribution History or
Latest Income Tax Notice of Assessment
           
For Self-Employed
Latest 2 years' Income Tax Notice of Assessment

Additional Documents     

     
1.  Clear photocopy of NRIC ( Front and back )
2. Original or certified true photocopy of the letter of acceptance from the institution of study, with indication    of duration of course and fees
3.  Original or certified true photocopy of the billing / invoice or separate course fees payment schedule
       (If course fees is not stated in the letter of acceptance)