Because Your Money Matters » Money Matters

Annuity’s Third Choice – The Indexed Annuity

GuestPoster — Mon, 06 Sep 2010 08:03:04 +0000

There was a time when consumers were faced just two choices when it came to choosing annuity contracts. The fixed annuity, which is capable of providing an investor with a reliable and steady income, was a favorite for those involved in retirement planning. With a variable annuity, the account value is based on the performance of individual stocks in the portfolio and this gives the investor the ability to hedge any inflation risk.

Now there is a third choice called the fixed indexed annuity. It was created to offer investors less risk than seen with a variable annuity but more growth than a fixed annuity. Indexed annuities are not really as complicated as they sound at first.

Anyone who understands the fundamentals of how an annuity works and has had annuities explained to them already has the basic knowledge needed to understand everything about an indexed annuity. An equity index simply takes into account additional factors. Like a variable annuity, the indexed annuity is tied to the market performance but it is not completely dependent upon its fluctuations. With a variable account, as soon as the investment portfolio sees a decrease, the value of the account decreases as well.

With an indexed annuity, there is room for some market participation by the investor. The value of the account is directly related to the index and it will increase when the index tied to it increases. Even during those times when the market goes down, there is a minimum return that will be realized. In some cases the return is 0% but the advantage with this type of investment is it cannot dip below that and go negative. As a result, your account will react to any index increases but will not decrease during a down market. To offset those times when the market is down, the investor is able to benefit from a predetermined portion of that growth. How much the investor can participate in will be determined by spreads, participation rates and spreads.

Stock Tips 101: Stock Market Terms on Investing

GuestPoster — Sat, 04 Sep 2010 17:30:01 +0000

The stock market is a pretty complicated place. We usually get to hear news about stock market, how it is performing, currency exchange rates, and other business-related matters. All an average individual can do is wonder how do some people outside the industry gets to understand the market when these people are not even involved in the stock market.

The most likely answer to this is that these people knew some stock market terms. Since the stock market involves trading and investing, it is important to know the commonly used stock market terms on investing to provide an idea to any average individual.

The following are some of the stock market terms commonly found in investing jargons and stock tips:

Blue Chip – This refers to a company with a history of strong revenues, habitually increasing dividends, and an outstanding balance sheet. Blue Chip stocks are usually from high-profile companies.
Book Value – Refers to the value of a company, provided that assets and common stock equity are combined together and all liabilities are deducted.
Dividend – refers to the share of a company’s profit that is granted back to the investors. The method of payment is either quarterly or annually.
Market Capitalization – Also referred to as market cap, is a method of assessing the value of a company by multiplying the number of shares by the stock market price.
P/E Ratio – simply refers to the ratio of a share’s price to earnings. It is useful in providing an indication of the share’s value.
Spread – One of the most common stock market terms, this refers to the difference between the Ask (lowest price that a seller can accept) and the Bid (the highest price that a buyer is willing to pay).
Yield – This is the percentage of a dividend paid against the stock price. For instance, if an individual receives a $4 dividend on a $40 per share stock, his yield is 10 percent.

Those mentioned above are just some of the most commonly used terms in stock market investing. There are more highly technical terms in the industry that may give an average person a headache. Nonetheless, having knowledge of these common stock market terms will be a good advantage for anyone, whatever field they may belong.

How Trading Options Is Different From Trading Stocks

GuestPoster — Fri, 03 Sep 2010 20:19:04 +0000

Options trading is commonly considered to be very risky by your average investor. If you were to casually mention to someone in conversation that you are thinking about including options in with your other investments, you might be met with a look of concern or even fear. A reaction such as this is completely understandable, especially when you consider the fact that most people do, indeed, lose money trading options.

The unfortunate reality of options trading is that it is a sector of investing that has caused a lot of financial loss for many people. For those people who initially got into the options trading market, they often do so as a result of attending a seminar on options. The speakers usually talk about all of the quick profits that can be made trading options and people then rush home with dreams of raking in the cash. Sadly, this quick rush to jump into the options market almost always results in the investor losing money.

Those who are new to trading options must understand that this form of investing is very different from stocks. Options can react differently than stocks to the same market forces. Just because a stock increases in price due to a newsworthy event, that doesn’t necessarily mean that the stock’s underlying options will increase as well. Such factors as the option’s volume and time till expiration are important factors that must also be considered. If new options traders would just take the time to learn the ins and outs of this dynamic market, they would probably see options as a great addition to their portfolio instead of the bogyman everyone makes them out to be.

Taking the time to read through a great book on trading options is an excellent way to start your options investing journey. Although there are many great books on options to choose from, one great book to start with is “Options for the Beginner and Beyond: Unlock the Opportunities and Minimize the Risks,” by W. Edward Olmstead.

Another thing you will definitely want to think about is picking up a good options trading software program to help you quickly scan the thousands of stocks that are out there to find the ones that are about to make the major moves. Fortunately, you don’t even have to spend any money to have access to such powerful software. These days, when you create a trading account with just about any of the online brokerage firms, you can use their online tools at no cost to do the same thing that the expensive software does.

Lastly, prior to jumping into any options trades with real money, take the time to practice your strategies. This can easily be done through your online brokerage account by starting a fictitious “practice” account that lets you practice trading options in real time without risking any of your money.

How to Finance Your Own Swimming Pool

GuestPoster — Thu, 02 Sep 2010 19:48:59 +0000

Today many residents dream of having a personal swimming pool, but believe this goal is unattainable because they lack the financial resources to acquire one. However, they should not give up so easily. Today there are a range of financial options that allow almost anybody to acquire their own swimming pool. By researching your options and making use of them, you too can soon be spending relaxing days by a pool of your own, enjoying a refreshing plunge when the mood strikes you.

Those who believe a vast sum of capital is required in order to pay for the construction of their pool are quite mistaken. Most lending institutions, probably even the one from which you took your current mortgage, will offer loans for the construction of swimming pools as home improvement loans. This is quite logical, as it is correct that adding a swimming pool to a home will increase its resale value substantially.

If you are looking at pool financing, it is logical to first consult the lender from which you have your current mortgage. Because all the particulars of your financial situation, such as your home’s value, your equity, the amount you owe, and your history of payment are known quantities to them, they are the most likely and logical choice when it comes to financing your pool. It is possible they will be able to redefine your current mortgage so that any rise in your monthly fee is insignificant, or so that the term of your loan does not increase by any considerable amount.

If you cannot make a deal with your existing lender, then explore other options. There are many banks and lenders out there, and at least some of them ought to be willing to make a deal with you that will put you on the path to obtaining your pool.

Don’t deal with disreputable or unethical lenders however. There are a few of them out there, and you don’t want sharks in your pool! Take note from the advice of websites like Voices in Finance, who recommend that you should only take out loans from a company of good repute and solid record.

When your new swimming pool is complete, you will be ready to get hours of enjoyment from it , and greater resale value for your home when and if you decide it is time to sell and move to another locality.

The How’s and Why’s of Bankruptcy

GuestPoster — Sat, 28 Aug 2010 22:58:59 +0000

Bankruptcy is a last resort measure taken by a person to protect most of his or her assets from being seized by debtors who are owed money that the borrower has no foreseeable means to repay. Bankruptcy is the legal right of the borrower to declare him or herself incapable of repaying lenders. Are you asking yourself, “How to file for bankruptcy?” Well, there exist several ways to declare bankruptcy and the common bankruptcy chapters involved in doing so are chapters seven, eleven, and thirteen.

When these chapters are disambiguated, one will find that chapters eleven and thirteen differ from chapter seven in that, chapter seven primarily deals with a liquidation process that is governed by United States bankruptcy laws. Chapters Eleven and Thirteen primarily deal with debtor reorganization. Chapter Seven bankruptcy prevails as being the most customary form of filing for bankruptcy in the U.S.

It may be a wise decision, when filing for bankruptcy, to hire an attorney who specializes in bankruptcy law, because the bankruptcy procedure is lengthy and complex. However, if you can not afford an attorney, do not let that dissuade you from filing for bankruptcy protection, as there are many forms of literature and even do it yourself bankruptcy software that can help guide you through this process.

Be certain though, before filing for bankruptcy protection, that bankruptcy is your one and only reprieve. Because after you file for chapter 7 bankruptcy, it will stay in your credit history for ten years. Bankruptcy is good and bad in this way: Filing for bankruptcy can be a great relief to you and your loved ones, however, it will also tarnish your credit history for a decade, which is a mighty long time when one considers all the financial challenges that may surface in the ten years following the bankruptcy filing. If you do have to file for bankruptcy, you may be relieved to know that you are not alone, in 2009 alone over a million and a half people and corporations filed for bankruptcy.

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Gold Investing Tips 101

GuestPoster — Sat, 28 Aug 2010 08:44:01 +0000

Finding the right gold investment for you and your family is one of the best things that you can do. It is a safe, wise investment that can yield you many wonderful benefits in the years to come. It takes a lot of time, and dedication to get started, so to make things a bit easier for you, we have compiled information that should help you get started.

Gold Investing: The Beginning

One thing that you will probably notice about gold investments is the simple fact that there are man options to choose from. But finding the right option can prove to be overwhelming. For example, you can invest in gold mining stocks, gold ETF, and hard assets. For the sake of first time investing, we highly recommend that you start out with assets.

What are assets? They are generally items like gold coins, and gold bars. Tangible assets that you would have full control over. Unlike investing in gold ETF, where you don’t actually own the gold, rather you would only own a portion of the gold. Each investment has its advantages and disadvantages. However, to get started with ease, start with hard assets.

Gold Investing: Where To Buy

You would be surprised to learn that you can find hard assets at a variety of locations. From pawn shops, to antique shops, hard assets are available just about anywhere locally. Even many jewelry stores have started selling gold coins. The main thing is to do your research, and find the right option for your current lifestyle.

Another help to you will be the internet. Not only can you shop for and buy gold coins on the internet, but you can also keep yourself up to date on the latest news concerning gold. Whether it be gold stocks, or gold mutual funds, you will be able to stay on top of the information that is important to you when it comes to gold.

Gold Investing: Closing Thoughts

Now you can begin working your way to a more solid investment future by learning from these simple wealth management tips and suggestions. Soon enough you will reap the wonderful benefits for you and your family.

Three tips to help you end credit card debt

GuestPoster — Mon, 23 Aug 2010 10:25:07 +0000

Are you tired of working hard only to make the credit card companies wealthy? Then it might be time for you to end credit card debt and start working to make yourself wealthy instead. This article will give you three concrete tips that will make the transition out of debt much easier.

First thing to do is to gather all your credit cards in front of you and get a pair of scissors. Yes, you guessed right. Next step is to cut them up and throw them out. That way you are unable to use them next time you get tempted and people tend to spend less if they have to pay with cash rather than plastic.

In order to get to the bottom of your debt as fast as possible it’s important that you pay more than you have to each month. If you stick with the minimum payments on a credit card debt with high interest you are just barely paying the interest and the actual debt doesn’t change much from month to month.

And third tip is to make a plan and a budget to help you write off debt easy. If you take the time to make a plan for how to get out of debt and create a budget to help you see how much you are spending and where you can make saves you will have a much bigger chance of success. Without a plan and a budget your chances of keeping track of spending and earning is very small and that makes it much harder than it has to be.

If you implement the three tips of cutting up your credit cards, paying more than you have to each month and make a budget and a plan for how to get out of debt you will be much more likely to make it.

Eliminate Debt Plan: a Step Closer Towards Freedom

GuestPoster — Mon, 16 Aug 2010 14:10:03 +0000

Are you finding yourself getting deeper and deeper in debt, and Eliminate debt plan is not working? Perhaps you should take a closure look at your attitude towards debt elimination. Freeing yourself from piles of debt may seem impossible, but with the right attitudes and outlook, it can be accomplished.

Be aware of your financial problems. Denying that you are in debt will never help you out. Accept your current situation and make tangible and realistic plans. Sit down and make a record of your full financial budget. This includes all your income from full time to your part time job. It also includes all your expenses. Evaluate our belongings. Scrutinize what valuable things you have. If the case calls for it, you can sell it and pay your debt.

A major thing you need to do is to stop using your credit card no matter what. This will stop you from incurring and adding more debt. Pay your existing credit card debts ahead of time. By doing so, you can go around paying high interest rates. Do away with unnecessary expensed like going out and watching movies or eating out. Only buy things that you need. And another thing, use cash in all your transactions. If doing all these still does not solve your debt problems, you can consider getting loan consolidation.

Your attitude greatly affects your plan. And any debt elimination plan, no matter how extensive it is, it will not work if you are not determined to succeed. If you need more income then find a part time job or sell some of your things. How to eliminate debt is one thing, how to avoid incurring debt is another. When you are done paying all your debts, don’t do back to your old practices. Know when to save and when to splurge.

Why You Should Keep A Close Eye On Your Stocks

GuestPoster — Sun, 15 Aug 2010 14:18:01 +0000

You work hard for your money and sometimes you want your money to work hard for you. This is why you look for investment opportunities and many people find these opportunities in the stock market. If you decide to invest in stocks you should learn to follow the market closely.

When you first learn how to buy stock, you should understand the money you invest will go up and down with the stock. In the ideal situation is where you catch the stock at a low price and when it rises to a high price you sell it and be happy with the profit that you made.

Sometimes investors buy stocks and then tend to forget about them. You can’t allow yourself to do that. You much watch the company for any announcements and even bad press. Anything negative such as a recall can send the stock spiraling down and you money that you invested can be lost. When you play the market you must play to win. Playing to win means watching the industry that the company you invested is in. You must learn to look for market trends. Are they releasing a new product that the public really is anticipating? That can send the stock up to high levels.

Don’t be an investor that thinks just because they picked a good stock at that time it will continue to stay that way. The market and industry could turn at anytime and the best stocks to buy right now may not be the best a month from now. If you are not paying attention it can turn out to be a very bad break for you. Sometimes the information you are looking for might be on page 3 of the business section and it might not be front page news. If you are serious about making money you must learn to dig deeper into the industry and company you are investing in. It can be the difference between success and failure.

How to Create a Debt Agreement with Your Creditors

GuestPoster — Thu, 12 Aug 2010 03:46:01 +0000

Financing is a tricky subject matter and if you are not in the know you may not be able to pull off a good debt agreement with your creditors. It is not just that fact that there may be many steps to undergo before the process is completed. Different creditors may impose different requirements and these prerequisites may change from time to time so that even if you consult with friends who have been able to negotiate a fair debt settlement, the conditions in effect may be different for you.

The advantage of professional help

It is always better to seek professional help in your debt agreement with your creditors. This speeds up the process of the negotiation as well as ensures that you avail of the most conducive terms for your resettlement. Additionally, professional debt negotiation services will know the weak points of credit companies and will be able to exert muscle on those points to get favorable responses to your less conventional requests.

Credit re-negotiators are highly knowledgeable, expertly trained and considerable experienced professionals who know the current laws regulating credit and payments. They are also usually members of a community of people comprising creditors and debt negotiators. Because of this, some of them may have connections inside your creditor’s business and some of these connections may be high enough to secure extraordinary terms for you. At the very least, given that you maintain good relationships with both the creditor and the agency negotiating for you, you can get very reasonable conditions.

What to prepare before consulting with professionals

You will first of all have your credit record in hand. This document will give negotiators a good idea of what concessions they can expect from the loan company. Additionally, it will set them to thinking about what special measures may need to be taken to improve your settlement contract. All invoices, billing statements and other communications that transpired between you and the creditor should also be available for reference any time.

Finally, you should be prepared with more than less accurate estimates of your income capacity and monthly expenditures, as well as precise figures about your current liabilities.