If you want to have the convenience of a credit card, but you can’t qualify for a regular credit card, one option is a prepaid card, sometimes known as a prepaid debit card or a stored value card. The concept is the same. It looks like a credit card, and you can use it up to some limit. Like an ATM card, you can use up to a specific amount. Depending on your bank, you may also have the ability to go over the limit on an ATM card, and maybe pay some overdraft fees. However, with a prepaid card, once you reach the limit, you can’t spend any more.
You can can get a prepaid card that looks just like a credit card, including having a Visa or MasterCard logo. They may look like credit cards, but there are a few things about them that are different, and that my make them attractive or unattractive depending on your situation.
Key things to know about prepaid cards
Whether you will want to use a prepaid card will depend on your situation. Before you use one, here are a few things to consider:
One ideal use of this kind of financial instrument is as a reloadable credit card for students, especially if the student doesn’t have experience dealing with credit cards or ATM cards, or maybe has done so in the past but has shown poor decision making.
For this kind of student, especially someone like a college freshman who is spending time away from home for the first time, a prepaid card can give a young person the convenience of a credit card with responsibility of keeping track of finances, while limiting the financial damage if they exercise poor judgment and self control.
Research by the US Federal Trade Commission shows that financial education affects financial decision-making. Failure to plan for retirement, lack of participation in the stock market, and poor borrowing behavior can all be linked to ignorance of basic financial concepts.
Some of these findings, from the 2008 paper Financial Literacy: An Essential Tool for Informed Consumer Choice? by Annamaria Lusardi, may seem quite obvious at first glance. For example, the author points out that those who demonstrate even a basic understanding of relevant financial topics are much more likely to have planned for retirement. These are not sophisticated topics, but basic things such as knowledge of interest compounding and the ability to perform simple mathematical calculations . Skills like these were shown to be among the strongest predictors of successful retirement planning.
To appeal to the average person, who may not have had a lot of prior exposure to financial topics or investment experience, the study suggest a social or even a psychological approach to financial education, for example exploiting “teachable moments” like the beginning of a new job, in order to get a person to think about taking action when their minds are open to new ideas about how financial decisions may affect their lives.
While the points raised by this study are reasonable, the challenge faced by society, even wealthy countries, is vast. Since the late 1980s when there were significant changes in laws regarding retirement planning, companies were much more free to move from traditional defined benefit plans like pensions to defined contribution plans like 401K plans that shift the responsibility of planning from the corporation to the individual.
While individuals and organizations with high levels of financial sophistication, such as firms specializing in industry specific areas such as chemicals m&a experts can easily manage rather exotic financial decisions, the average person has a much more difficult situation. Financial instruments have become increasingly complex and individuals are constantly being bombarded by the investment industry with new and financial products. However, most individuals are not well equipped to make financial decisions.
The study showed that most individuals cannot perform simple calculations and lack knowledge of basic financial concepts. Knowledge of more complex concepts, such as the difference between bonds and stocks, how mutual funds, and how to estimate the value of an asset is even rarer. Financial illiteracy is widespread among the general population, and particularly evident in some demographic groups that happen to also be overrepresented among the poor and struggling working class, such as women, African-Americans, Hispanics, and those with low levels of formal education.
The Internet makes outsourcing of business functions, especially back office type functions like accounting and word processing, especially attractive for companies in high-wage regions like the USA and western Europe, to outsource to low-wage countries where trained professionals can do a competent job.
Outsourcing may be a great idea for individual companies, but on a national level this kind of activity may cost jobs in America and other high-wage countries. Some business owners, large and small alike, are seeing the harm this trend may cause in their home country and as a result, have begun taking actions that lower their back office costs, but helps to keep jobs in America.
The key to saving a lot of US jobs isn’t people, but rather software. Three important pieces of software, all created in America, play an outsize role in keeping some jobs from being shipped overseas.
The Microsoft Office Collection
Arguably one of the most popular pieces of software to ever be invented, the Microsoft Office collection has found a comfortable home in the American business community. Even better, the collection was completely created by the all-American company—Microsoft—Bill Gates’s iconic, multi-billion dollar corporation.
Featuring well-known programs such as Word, Excel, and PowerPoint, the Microsoft Office collection is widely being in a variety of diverse business applications. For instance, a company memo can easily be created in Microsoft Word, while important monthly budget figures can be collected, sorted, and analyzed in Excel.
The brainchild of Intuit, an American-based company headquartered in Mountain View, California, QuickBooks has proven itself to be an asset in the business world, allowing business owners to track their sales and expenses, take the hassle out of taxes, and act as an overall organizational tool for finances.
Aside from organizing finances, QuickBooks has also gained a reputation for being superior in managing payroll and inventory. As most business owners know, running a business is filled with financial pitfalls and loopholes, all of which must be tracked and managed accordingly. Enter QuickBooks! Moreover, this essential piece of American-made payroll software is great for fending off the tax man at the end of the year.
Taking after its name, TurboTax is a tax program that has made end-of-the-year taxes much easier for everyone ranging from the small business owner to the individual consumer. Just like QuickBooks, TurboTax is also the creation of Intuit, meaning it is as American as they come.
Business owners know all too well the logistics involved at the end of the year when tax season arrives in full swing. However, tax time can be made much less stressful by using TurboTax, especially when you consider the fact that the financial info recorded in QuickBooks can easily be integrated into the TurboTax program. TurboTax is quickly becoming a staple amongst freelancers, small-business owners, and even CEOs.
The point here is that an American-owned business doesn’t have to look overseas for a low-cost alternative to completing necessary back office functions. In many cases, software that is made and maintained by American companies offer a viable alternative to sending money outside the country. Before deciding to outsource, a manager or business owner may first want to do a little research to see if a domestic software option is better and cheaper than sending work to a foreign country.
The massive changes in the economy in the last five years has had a number of effects on average consumers. One of the biggest is the drop in home ownership because of tight consumer credit or because of home foreclosures. Another effect is that homes in many parts of the country dropped in value so much that for many consumers, they owe more than the house is worth, and have no equity in their home.
For many in the US, their home was the most valuable financial asset they had, and in many cases, the only significant one. In fact, the 2012 Statistical abstract of the United States stated that in 2007, just before the start of the most recent US recession, the average net worth of families that owned their home was about $230,000, but for renters, it was about $5,000. Since then, the situation has become worse for everyone, especially for those who don’t own their home.
Because of lower rates of home ownership and the decline in home values, home equity loans are no longer an option for many consumers. For those who don’t own their home, often the only asset they have is their automobile. The consumer financial services industry understands this, and has increasingly provided an additional option for consumer, a loan on the value of their automobile. Also called a car title loan, this is a loan where in exchange for the title to your car (and the right to repossess that car), you can get a short-term loan.
The biggest drawback of these loans is the huge interest rates you may have to pay. While a home equity line of credit may have less than a 10% interest rate, and a credit card upwards of 25%, many car title loans may have effective interest rates of 300% or more.
If you are in a position where you need money and have no other options, then go get a auto title loan chicago or from some other local vendor. But if you do, be aware that it could cost you more than you expect.
If you hear the word “fracking” and you think of the science fiction series Battlestar Galactica, this is not the right article for you. If however you have an interest (either intellectual or financial) in the oil and gas exploration business, then fracking has a whole different meaning, specifically the process by which oil, natural gas, or other petroleum products are extracted by a process that injects fluids into petroleum-bearing rock in order to extract the petroleum products.
The process is controversial in some circles because of the environmental side effects. If you happen to be in circles that have an interest in investing in oil and gas exploration and extraction, the only controversy may be how quickly you can get in on the action and receive a decent return on your investment.
The fracking process is the key reason why there has been a substantial increase in oil and gas exploration and production in older oil fields in Texas, newer fields in North Dakota, and in other parts of the US.
There are many ways to get involved in the action, and how you can get involved depends on your current financial situation. For most people who do not have substantial income or wealth, the two most likely ways you can get involved is to either get a job of some kind in a related field, or to invest in the stock of companies involved in the exploration, production, distribution, or sale of petroleum related products and services. It will be up to the the potential employee or investor to find out if in fact the company you are looking at is actually involved in an area of the petroleum business where you want to invest.
If you are a qualified investor, meaning you meet certain criteria for income, net worth, or both, you can participate in a wide range of activities beyond employment or stock and option trading. This includes limited partnerships in petroleum exploration or development projects, real estate investments in the mineral rights of landowners in areas where there is substantial recent oil and gas exploration or production, or investing in companies that are actively looking for companies to purchase that may be in a related business.
The first order of business for any new investor, or even a current investor looking at expanding into a new area of the oil and gas business, is to do their research or due diligence. For any investor, that may mean learning the vocabulary and geography of the business so that when you read or hear something about fracking, you will have at least an idea of what other questions you should be asking.
If you are a more sophisticated investor, it doesn’t mean you can trust your past experience as a limited partner in a project or your time working as an analyst at a chemicals m&a firm. You have to embrace the attitude of someone going into an entirely new kind of business, and make no assumptions that what you knew yesterday has any bearing on what path you should take today.
When it comes to real estate investing, the investor usually has one of two primary goals, obtaining ongoing cash flow or getting either a short-term or long term capital gain. First, some basic definitions:
Capital Gains - If you invest for capital gains, your goal is to sell something for more than you bought it after that asset has appreciated. In order to receive the gain, you typically no longer own or control the asset.
Cash Flow - If you are a cash flow investor, your goal is to receive a series of cash payments from your investment, typically monthly or quarterly rental payments, while you own or control the asset.
There are of couse other considerations for real estate investing, primarily depreciation and tax advantages, that go into a decision to buy, sell, or hold an asset such as a residential or commercial real estate property. No matter what your goals, unless you are financing the purchase with existing assets, you will have to consider the role that your loan or mortgage will play.
If you’ve ever taken out a loan, owned a credit card, or have a mortgage for your house, you are probably quite familiar with the various interest rate options you may have. Investors are typically more sophisticated than buyers who are only looking for a place to live in rather than an investment property, and this could give the investor certain advantages. For example, if you have an investment that was financed at a fixed rate, and you are in a position to sell to a buyer who is unable to find a reasonable rate loan, if your fixed rate were low enough, you could offer a variable rate that would ensure a larger cash flow to you in the future.
To get an idea of what the situation may be like for someone who is considering purchasing a single family residential property that you own, you may want to visit a bank site to see what a Standard Variable Rate may be for your buyer.
If you know what kind of options your buyer has, and what your options are for offering alternative financing options, you could put yourself in a better position to profit over the long term.
Previous articles have discussed various aspects of debt management, including changing one’s approach to debt. Those changes can included reducing the total amount of debt, reducing the number of debts, looking at different financing options, and understanding the difference between a positive debt that leads to long term positive financial results, and negative debt that only produces expensed and creates no benefits.
One of the golden rules of debt is related to the last distinction of a positive or a negative debt. A positive debt incudes debt that is finances an asset that produces income that exceeds the costs of debt service and the other costs associated with that asset. An investment in an apartment building that produces a positive cash flow each month is an example of a positive debt.
Another kind of positive debt would include an educational loan that allows someone to find employment that produces a higher income, even after taking the educational debt payment into account. These very same debts could become a negative debt if the investment has a negative cash flow or if the educational loan doesn’t lead to a job or a pay raise.
While managing or reducing debt can be a primary financial goal, sustainable financial stability is much more likely to happen when you have assets working for you. Your assets can range from cash in a savings account or other low-risk paper asset, or a business or real estate investment that provides a positive cash flow every month.
If you don’t have any assets at all, it is probably smartest to start with a low risk asset like a savings account or precious metals. If you are going to use some kind of paper asset, it may be best to put it into an account that is not easily accessed to keep you from being tempted to spend it quickly.
Precious metals may fit into this kind of strategy, since you can’t just take a silver bar or a gold coin link 1 oz gold american eagle to the store and use it like a common currency. You have to first take it to a coin dealer and exchange it for regular money before you can spend it. Gold and silver have an additional advantage as it can be used as a hedge against currency fluctuations and inflation.
Even if your debts are far larger than your assets, having even a tiny amount of assets to your name could do wonders to make you feel better about your financial situation and your prospects for the future.
Often in the online world, a new set of buzzwords like ‘big data’ goes from being something known only in the technology world to something that is mentioned frequently in mainstream media. Like many other technology buzzwords, the reality of big data was happening long before the media hype, and long before the technology world even gave it a name.
A short definition of big data is the analysis of sets of data that are so large or so complex that it is difficult for conventional data analysis tools and techniques to make sense of it all. Because tools and technologies change, what may have been a difficult big data challenge during the era of Apollo missions to the moon in the 1960s and 1970s becomes a middle school science fair project in 2012.
Modern big data problems included weather forecasting and designing search engines. Much of the media hype revolves around big data issues that could result in big profits for private companies. Some, like Michael Fertik of the company Reputation.com, are quite keen on the idea that individuals and companies can benefit from using big data related technology to manage their online reputations.
While the concept of using a third party to manage online reputations may be validated by the marketplace, it doesn’t necessarily mean that a person or a company must pay a third party in order to benefit from big data related technology.
Many of the basic tools of big data are widely available to the public at no charge. The key to making the technology useful and valuable is the skills that are applied when using those tools.
Perhaps the most common example is the search engine. The largest search engines such as Google and Bing cost billions to develop and many millions per month to operate, yet they can be used without charge by anyone 24 hours a day for whatever purposes they have in mind.
Over time, most people who use search engines regularly come up with ways to use search engines to improve their lives or their businesses, and in most cases without paying for an expert or a company to do so on their behalf.
The rush by companies to capitalize on big data related business opportunities has many of the elements that existed in previous booms and busts related to gold, oil, and in the 1990s version of the Internet. Like the gold rushes of the past, some companies will likely become fabulously rich from the gold, many more may become as rich or even richer from activities that support the gold rush, but the vast majority won’t find a fortune and will likely not survive until the next gold rush.
The world of business and finance are filled with numbers, and often filled with fairly complex mathematical concepts in probability, statistics, game theory, and operations research. This is true in just about any enterprise, and is especially true in those kinds of large-scale activities that support basic services in large metropolitan areas.
Dealing with garbage and recycling are one of those kinds of activities that every community has to deal with, and for larger communities it often involves many issues ranging policy making, taxation, electoral politics, and long term planning. Because of the policy and political aspects of these kinds of endeavors, it is vital that every stakeholder in the affected communities have at least a basic understanding of the scale and scope of what that community faces.
When it comes to these kinds of ongoing issues, anyone who is interested in affecting the outcome of the decisions that have to be made should embrace any tool that will help stakeholders and decisions makers agree to their point of view.
One example is the following graphic called the Secret Life of Garbage. A colorful and well-designed graphic like this may not immediately change hearts and minds about how to deal with garbage, but it would almost certainly encourage people to learn something about the issue.
Mortgage payment calculations are based on complex mathematical formulas, and fortunately there are many options for finding calculators to make this mathematical process easy and painless.
By using a mortgage calculator, it becomes very easy to know the monthly payments you need to make, and very easy to see what happens to your payments when you change key values like the amount of the loan, the number of payments, and the interest rate.
Types of mortgage calculators
There are two different types of mortgage calculators, online calculators and traditional physical calculators that have built-in functions for computing principal and interest payments. The online mortgage calculators are mostly used by the borrowers, and real estate and mortgage professionals usually prefer using the physical ones.
You’ll need nothing more than an Internet connection to be able to access the online mortgage calculators. They are available free of cost and are very easy to operate. You’ll just need to put in the necessary information, usually the amount of the loan, the number of payments, and the interest rate.
The most common types of mortgage calculators include the following:
The benefits of mortgage calculators
Mortgage calculators are beneficial in several ways when you want to refinance mortgage or calculate your debt payments:
Using a mortgage calculator prior to making any mortgage related decision is important. The calculations give you an idea about the present market conditions and how you can benefit yourself the most.
If you grew up in the U.S. in the 1960s, the world of banking was much different than it is in the 21st century. Back then, most banking, whether business or personal, was very local, with the majority of working people, even those with high salary jobs, using savings and loan banks.
These banks made most of their money by making loans for local homes and businesses, with the amount of loans depending on the amount of deposits at the bank. If the local bank was in a relatively prosperous area, then the size of the loans and the amount of services that they offered would be quite a bit higher.
No matter how high or low the level of service, nearly all banking was face-to-face. It was very hard to do any kind of banking if there was not a branch office nearby. The idea of doing routine banking by phone was not offered for most depositors, and the concept of banking by computer only happened in science fiction.
Fast forward to 2012, and the situation is very different. While local banks and bank branches still exist, anyone in the U.S. can easily choose any bank in the country for their day-to-day transactions. You could deposit your paychecks in a Massachusetts bank, even if your job is in a nearby town. While you still may have to talk to a representative during the bank’s business hours, you can get 24 hour access to your bank online.
Where does does all these options leave the average individual or business banker? Simply put, in a very powerful position. Once you get beyond the idea that your bank has to be local, you can pick and choose the bank that works best for you.
Once you make this mental switch, you figure out ways to deal with having a non-local bank. One common tactic is to choose to bank with a credit union that allows you to use the ATMs of other credit unions without surcharge, or that may even allow you to do in-bank transactions like depositing paper checks.
|Other forms of loans, such as bad credit loans are allowing consumers to survive the credit crunch. Applying for cash advance payday loans online is easy.