It’s pretty common knowledge that people with great credit histories get better rates on home mortgages, auto loans, and other types of financing. Here’s a fact that’s not as well known: your credit history also determines your insurance score â“ a number that can have a major impact on how much you pay for home and auto insurance.

Insurance Scoring [1]
In recent years, insurance scores have become one of the things insurance companies consider when calculating home and auto coverage rates. The scores are considered along with age, driving record, claim history, and other factors, to predict how likely a person is to have a loss. Greater likelihood of a loss translates into higher premiums.

Your driving record is one thing â“ but how does your credit history make you more or less likely to have an accident? Insurance companies maintain that credit behavior can be an accurate indicator of risky behavior in other areas.

While it’s logical (and often correct) to assume that improving your credit score will help improve your insurance score, that’s not always case. Paying your bills on time will typically help because it indicates responsible behavior. But certain credit decisions — like opening several department store charge accounts or running up balances â“ can hurt your insurance score and increase your premium by hundreds of dollars.

In search of a lower premium
Each insurer has its own method of calculating premiums, so there’s no clear-cut way to find out which company is likely to give you the best deal. In general, though, there are some things you can do to improve your chances of getting a lower premium: [2]

 Shop around. Premiums can vary widely, so get quotes from at least three companies.
 Pay your bills on time and check your credit report for errors at least once a year.
 Avoid taking out retailer credit cards that are issued by a finance company.
 Try to pay balances in full every month, or at least keep balances as low as possible ⓠespecially on cards with low credit limits.
 If circumstances beyond your control ⓠsuch as divorce, job loss, or a death in the family ⓠhave had a negative impact on your credit, ask the company if they will make an exception.

Donna Parshall writes articles for Check n Go about online commerce, responsible borrowing, investment, and budgeting. Visit their site to learn more about Check n Go installment loans and other services like payday loans and cash advance.

References:

[1] Credit Based Insurance Scores.❠National Association of Insurance Commissioners and The Center for Insurance Policy and Research.Web. 07 Aug. 2012. http://www.naic.org/cipr_topics/topic_credit_based_ insurance_score.htm

[2] The Secret Score Behind Your Auto Insurance.❠Consumer Reports.Web. n.d. http://editorial.autos.msn.com/article.aspx?cp-documentid=435604

Taking out a loan secured on car is an option for many people pressed for cash. Despite the popularity of logbook loans among the British, the Office of Fair Trading and the Consumer Credit Trading Association have taken steps to introduce changes to the industry.

Reasons for the changes

There are a lot of firms that offer loans against cars, some of them not playing according to the rules. One customer shared his experience, I borrowed $3,000 and the potential term of the loan was three years, so that could have resulted in me paying $10,500 in interestâ.

During a few past years, a lot of second-hand car buyers in England and Wales fell victims to imperfect logbook loan laws designed to protect the lender, while the consumer was left to pay off debts of other people. I took the previous owner to smalls claims court, won the court case and everything but literally did not get anythingâ, a car buyer complained.

New laws

With certain companies demanding unfair interest rates and a growing number of second-hand car buyers liable for other people’s debts, the Department for Business, Innovation and Skills was considering the possibility of imposing a ban on the entire logbook loan industry, but the government decided not to restrict consumer access to credit.

Greg Stevens, chief executive of the Consumer Credit Trading Association, said, We’re looking at one rotten apple in the barrel. We’ve been working closely with the Department for Business, Innovation and Skills and the OFT to come up with a code of practice which is specific to the logbook loans sector. It will be audited and monitoredâ. According to the new code, companies must register finance on cars on an Asset Finance Register within 24 hours.

Even though more than 96% of companies have accepted the code, remember to do all the necessary checks when buying second-hand cars and taking out loans.

photo by consumerist

With the economy still in an uncertain place, it’s important to organize your finances in any way you can. This might mean keeping tabs of your spending, or it might mean applying for a low interest credit card with a provider like MBNA â“ so let’s find out more.

Here are five ways to manage your money:

Consolidate your debt

Do you have an outstanding balance on credit or store cards? Perhaps you’re finding it difficult to pay your monthly bills? If so, it’s worth transferring all or part of your debt to a credit card with a lower interest rate. This is known as a balance transfer and will help you take stock of your outgoings before they spiral out of control. You’ll only have one monthly bill to think about and will be able to pay off the money you owe, without accumulating extra charges â“ so it’s worth thinking about.

Apply for a specialist credit card

If you already have a credit card in your wallet, applying for a new one might seem like a chore â“ but a specialist card could save you money. If you’re a football fan, for example, a football credit card will give you access to a wide range of special offers and discounts and will allow help you feel part of an exclusive club. You’ll also receive reward points whenever you spend and will be able to claim a wide range of football merchandise and goodies â“ which could come in useful now the new Premiership League season’s underway.

Make the most of internet banking

Paying a bill or cashing in a check used to mean long, tiresome treks up and down the high-street â“ but this is no longer the case. Now, you can manage your incoming expenses and outgoings via the net and can keep an eye on the amount of money in your account. If you don’t have an internet banking log in discuss this with your bank and try to arrange one as soon as possible, as it will make your life a lot easier.

Open a savings account

Whether you’re saving for a deposit on a house, or want enough money to enjoy a fun-filled retirement, why not open a savings account? Simply put money aside every month â“ via a direct debit transfer â“ and try not to withdraw it until you have a nice nest egg. A little extra cash will come in useful down the line and will give you the financial security you really need.

Stay within your overdraft limits

Times are hard at the moment. That’s why it’s important to stay within your overdraft limit. If you manage to do this, you’ll avoid bank charges and will be in a stronger position when you next get paid. While many banks offer an emergency fund â“ available if you go over your overdraft â“ it’s not wise to dip into this, as you might find you receive a charge every few days.

Managing your money is easier than you may think, so take control today.

photo by alancleaver

Tell me if this sounds familiar. Every time you think about saving for retirement, two things happen:

1. The thought of putting money in the stock market makes you recall your experience on the Dragon Coaster after having eaten too many corndogs.

2. You experience your recurring daydream of becoming king of the local real estate market.

But then reality kicks in, and you reluctantly start fishing around for the postcard you got from the latest mega mutual fund.

You can go that route if you want to. You will be joining a lot of other people who watch their retirement funds dip and swing with the vagaries of Wall Street. However, there is an alternative. Broad Financial is a company that specializes in self-directed IRAs. They have streamlined the process so that putting a piece of local real estate in your IRA is as easy as signing a check.

The way the self-directed platform works is through the power of a LLC (Limited Liability Company.) When you decide you want to take control, Broad sets up a dedicated LLC for your IRA and appoints you as its manager. Then, you can open a checking account at the bank of your choosing in the name of the LLC. And that’s pretty much it. Now you can place real estate in your IRA by just writing a check from the LLC’s checking account. The sale takes place immediately, there are no additional transaction or asset fees, and your retirement is growing with a real piece of property.

That’s the basic idea. Now let’s address a few common questions.

What kind of taxes do I have to pay if I hold real estate in my IRA?

The answer is none. The property is considered an asset of your retirement fund, and thus is tax deferred until you reach retirement age. If you have a self-directed Roth IRA, then you’re tax free forever.

What kind of property is my IRA allowed to buy?

There are no limitations. If you find a piece of real estate that you think can make money, be it as a rental, fix-and-flip, or a straight up investment, you can purchase it for your IRA.

Can I just make a down payment with my IRA funds and use a mortgage to pay for the rest?

Yes, but you have to use a non-recourse loan. That means that the lending institution has no recourse to the individual borrower, and instead guarantees the loan with the property itself. The reason why you have to use a non-recourse loan is so that you don’t give any personal guarantees for your IRA. Giving a personal guarantee would constitute a Prohibited Transaction. If you’re interested in obtaining a non-recourse loan for your IRA, Broad can provide you with a list of reliable institutions.

How long does it take to set up a self-directed IRA?

It depends on the state where you will be creating your LLC. Different states have different set-up times. Normally, the process can be accomplished within two weeks.

What happens if I want to sell the property?

Just go ahead and sell it. The proceeds from the sale are deposited back into the LLC’s checking account, thereby becoming part of the IRA’s assets.

With a self-directed IRA, you can move beyond Wall Street and invest in assets that you know and understand. Real estate is just one of the options. Other popular choices include franchises, private loans, and business start-ups. Basically, any solid investing idea can be financed with a self-directed IRA. If you have hesitated in saving for retirement because of the wild market swings, now is the time to reconsider. Get going with a self-directed IRA and you can finally start creating your own prosperity.

Broad Financial specializes in self-directed IRAs. You can reach them at 800.395.5200, and find out if the self-directed platform makes sense for you.

How are the rich doing it? This is a question that’s asked by virtually every other person across the nation at some point or another. Do they save every penny and eventually have enough of them over the years to propel them into the wealthy status? Do they spend their money to achieve all of this great success? These are the million-dollar questions everyone wants to know.

In truth, the answers to these questions are just as diversified as the people inquiring them in the first place. Some have inherited their wealth stemming from generations before them. Others have gotten lucky through various stock market plays, or lottery type winnings. However, a bigger majority of the wealthy have in fact done a combination of healthy savings and smart spending decisions. This combination is also a good starting point for anybody who’s serious about changing their tax brackets, and eventually graduating to the wealthy class. Another way rich people make more money is by ensuring that their money kept in the best fixed term savings accounts.

The first thing to take a look at here is savings. Most people have a huge misunderstanding about these accounts, and how it should affect their personal finances. It’s important for people to realize that savings alone is hardly going to make them wealthy. Instead, saving money should be looked at in short term goals. Most people will never be able to put enough money into their savings accounts nor fast enough to benefit from interest against inflation. In other words, their money will never grow that way, and could even shrink during tough economic times. That’s why savings should serve a different purpose early on.

A savings account should be viewed upon as more of an emergency fund. In fact, many suggest having a least six months’ worth of living expenses in savings at all times. Should an emergency arise, this fund can be used towards this situation and then be replenished again as quickly as possible. In a time where jobs are scarce this also hedges against any sudden loss of employment. Outside of that, there is little use for a standard savings account.

Therefore, don’t be fooled. The wealthy aren’t just putting everything they have into some savings account. They are also big spenders. The difference is they are often spending money on things that make them more money in return. Outside of reserves, money is much better spent investing. This can be anything from owning gold, stocks, real estate, or even starting a business that employs other people while returning a healthy profit. The reason why they spend their money like this is because the return on these investments can actually get out in front of inflation unlike a savings account, and in some cases be way out in front of it.

It’s not really much of a secret the rich have over everyone else. It’s all about being smart with money. Shoring up savings for the short-term, and investing for the long term will help anybody get started down the path of great fortune. A popular bank for rich people is Birmingham Midshires Savings. It might be worth checking out.

photo by Z Dead

Let’s face it; personal credit cards and business credit cards are not built the same. People with business credit cards expect more benefits for to enjoy. This is because such benefits help to outweigh the extraneous costs of running a smaller business in today’s world. Hands down, the American Express Starwood preferred guest business card is probably the best deal that a business owner is going to find as far as credit cards go. This is especially true for those business owners that enjoy traveling.

Outrageous Benefits

When Starwood brags about elite benefits, they mean ELITE benefits. We’re talking rewards such as flying business owners out to the US open, all expenses paid.

Many credit card companies have caps on what they are willing to offer a business owner, and American Express is clearly not such a company! On these travel prizes that they give away to card holders, they typically also enter their card holders into special contests as they travel.

This means that the business owner has a chance of winning money while they are on vacation. It is these elite type of benefits that make all other business credit cards pale in comparison to the Starwood card.

Epic Travel Rewards

Generous travel awards are also given with these cards. Travel is the essential key to running any type of business. Face it, the world is shrinking and becoming more of a global economy than ever before because of the technological advances in travel and communications that have taken place over the past half a century.

Going global is now just as realistic of an option for mom and pop vendors as it is to giant, nationwide corporate chains! To go global one must travel at the expense of his business however. Traveling points on the company credit card sure do ease the costs typically associated with traveling. Why is traveling so important? Because this is how one makes the type of connections that are necessary for one to take his business global! It sounds simple, but it a little bit of traveling really does make all the difference in the world.

Double the Perks Baby!

There is also a personal version of the Starwood card for business owners. Why is this so important to mention? Because American Express is offering double the perks for people that sign up for both of them. That is double the Starpoints, double the travel opportunities. Not taking advantage of a deal like this is just plain silly when doing business in today’s global economy. This is true despite the size of ones business!

American Express makes it easy to sign up for both cards from their website. After all is said and done, you’ll be enjoying those double perks in no time. Another important thing to mention is that American Express and their affiliates are always doing point giveaways. Keep in mind that 50,000 star points is a value over $1,200! Starpoints add up very quickly because of this.

Free Nights in Luxury Resorts

Did we mention that free flight miles are not the only thing that Starpoints are good for? You can get free nights in luxury hotels as well! Hey, why you’re traveling to build those business connections, it never hurts to have a place to stay does it?

Reliable Lines of Credit

Starpoints are not the only reason to go with this card however. Keep in mind that for many years now, smaller business owners have been trusting the American Express brand when it comes to taking out lines of credit to help their businesses. This is one card provider that has been helping businesses to grow for many decades now. They simply would not be around offering Starpoints today if they were no good at lending.

It’s simple logic, the firm that has been around such a long time has been around such a long time because they are very good at what it is that they do! American Express is good at providing credit cards, and this statement is true whether you are looking things from the perspective of a business owner or a personal card carrier.

What are you Waiting for?

If you are a business owner then what are you waiting for? You need to sign up for both Starwood cards so that you can begin the process of growing your business today! With the help of American Express and Starwood on your side, you just might grow into a multinational!

With higher education costs skyrocketing, many graduates these days are saddled in debt that can take years â“ no, decades â“ to pay off. It’s one thing if you have a job such as lawyer or doctor that makes it easy for a young grad to pay back her student debt quickly. But given today’s treacherous job market, and the reality that many popular careers don’t pay generous salaries to entry-level positions, many graduates have to think strategically about how they’ll pay off their student loan debt.

It’s a good idea to evaluate your student loan situation shortly after (or even before) graduation, so you don’t make mistakes early on that you regret later on. Many colleges and universities have student loan counselors and other experts on hand to help guide you through the initial process. But it’s good to understand the basics and take steps to pay off your student debt in timely fashion.

Here are some tips for paying off student loan debt faster (and cheaper):

• Assess interest-rate opportunities. Today’s historic-low interest rates offer recent and not-so-recent graduates the opportunity to lower the interest rates on their student loans. Federal subsidized loans today carry a 3.4% interest rate, while un-subsidized loans carry rates of 6.8%. Other types of loans carry even higher rates. (Keep in mind that you can deduct up to $2,500 annually of student loan interest on your taxes, assuming you meet the income limitations.) But while student loans tend to carry lower rates than many other types of loans, in today’s environment, private lenders might be willing to let you give you even lower rates interest rates â“ and you can still take the tax deduction. It’s worth at least exploring that option. Moreover, if you own a home, also consider whether using home equity to pay off student loans makes sense, given today’s low rates. A word of caution, however: You may want to keep your student loans as student loans, as you have more flexibility for deferring them if you ever get into a financial bind.

• Compare repayment plans. Student lenders typically offer several different types of repayment plans, from 10-year plans in which you make fixed payments over a 10-year period to “graduated” plans in which payments increase every two years, assuming that your income will be increasing as well. If you consolidate your loans after graduation, you can stretch repayment for up to 30 years, though you’ll pay a lot more in interest if you do so. If you are entering a career in public service, such as working for government or as a teacher, you will likely qualify for the Public Service Loan Forgiveness Program. If your household income is rather low, you might also qualify for “income-based repayment,” which ties your payments to your income. Which repayment plan makes sense for you depends on your salary after graduation and other financial priorities. It’s great to pay off your student loans quickly, if it’s possible, but keep in mind that it’s lower-interest debt, especially if you qualify for the student loan interest tax deduction. Focus on paying off higher-interest credit cards and even stashing something away for retirement before putting more than necessary toward your student loans.

• Save wisely. With a little creativity, you can probably come up with some ways to save up extra to put toward your student loans. Consider setting up a separate savings account in which you stash extra money you get, whether it’s a little from every paycheck, gift money or your federal tax deduction. Then use that money to pay extra on your student loans each month or year. Even paying an extra $50 per month on a $50,000 loan with a 6.8% interest rate could save you about $2,300 in interest over a 10-year loan and shave a year off the repayment term, according to this Bankrate.com college finance calculator.

• Invest with care. You might be able to defer payments for a while, such as during the six-month loan grace period right after college. Consider using these times to sock away money in investment accounts, such as a taxable brokerage account. Then invest the money across a broad range of investments, such as domestic and international stocks and bonds. By generating higher returns on these investments, you can use those earnings to pay down your student loans later on. Remember, that ultimately student loan debt is lower-interest debt than most other types of debt. While you want to pay it off a good pace, you might do better putting extra money into investment accounts, assuming you can earn higher returns than the interest rate you’re paying on your student loans.

Kelly Spors writes for RothIRA.com, a leading retirement and Roth IRA resource. A former Wall Street Journal reporter, Kelly has written about small business and personal finance for The New York Times, Entrepreneur magazine, Yahoo! and SmallBizTrends.com.

photo by PT Money

Many of us would like to be rich, I think that’s safe to say. Most of don’t want to do what it is that it takes to be richâ”I think that’s equally safe to say. We tend to think of rich❠as either having rich parents (read: inheritance) or lightening strikingâ”think a hit record, a stock rising by a factor of 50 or having the winning lottery ticket.

What most of us miss, I think, is that becoming rich isn’t so much an event as much as a lifestyle. The earlier it’s adopted, the more likely it is to work it’s magic.

That lifestyle requires a great big helping of delayed gratification, which is the process of making sacrifices now for a better tomorrow. Even if it never makes you richâ”or if you’re starting it a bit late in the gameâ”it can still move you from where you are to being very comfortable, financially speaking.

What does delayed gratification look like in practice?

Let’s NOT keep up with the Joneses

Millions of people want nothing more than to have what everyone else has. That’s a costly lifestyle, not the least of which because you tend to build up an inventory of stuff that’s mostly good for other people but not necessarily for you. That consumption pattern turns your spending priorities over to others.

The richâ”the self-made ones at leastâ”break from the human herd and establish their own spending priorities. Those priorities have little to do with keeping up with others. They don’t need the latest entertainment gadget, the latest car or the most house they can afford.

They’re willing to let those preferences go for the time being, and that creates other financial opportunities.

Avoiding the debt trap

When you aren’t busy trying to keep up with the consumption patterns of others, you not only have fewer toys, but you also have less debt. If you’re trying to keep up with others early in life when your income is relatively low, the only way you’ll be able to afford to buy all that others tell you that you need or must have is by borrowing. Once the debt pattern is established, it’ll be tough enough just to get out of it, let alone to get rich.

Delayed gratification means avoiding debt and the trap it creates. You only buy what you can afford, and only then if you absolutely need to.

The aspiring rich win the money race almost by default when they avoid debt. It keeps their money free for other, more important pursuits, likeâ¦

Investing for the future

If it’s one characteristic that separates the soon-to-be-rich from most other people it’s their commitment to invest for the future. They’re willing to give up the toys and adventures others are pursuing in order create a more prosperous future.

This strategy is especially effective if you can do it in your 20s. By avoiding the good life❠early on and investing for the future, it’s possible to have a six figure bankroll by age 30, and when that’s attained in combination with not having any debt the future potential becomes almost limitless. From there reaching your first million is just a matter of time.

You also have to start investing smart and using strategies such as dividend investing.

Buying value at every turn

Delayed gratification doesn’t mean being cheap, it means buying value. Whether it’s buying a car or a TV set, you’re looking for the best value for the money. That might mean buying a second hand car, or even shopping at thrift stores, but the idea is to get the best products for the least amount of money.

That attitude extends to investing. You buy assets that have an above average chance of providing reliable cash flows in the future, as opposed to those that have been the best performers in the last few quarters.

Ultimately, delayed gratification gets you to the point where you can have the things that you want, when you want them. And all because you put off getting them until just such a time that you don’t need to make trade offs.

Try implementing delayed gratification for yourself right now, what ever your financial situation is. Live on less, ignore your friends and neighbors when it comes to consumption, save all that you can, and keep yourself focused on a better tomorrow.

photo by mmordfin