Blog

Yakezie Epsilon Class

2012-02-16T04:31:16Z

I was just about to hit the sack at about 11pm tonight. I, like so many others, had to just take one more look into my Twitter stream to see how everyone else was winding down. I saw something I couldn't ignore - a post from @yakezie.

I've been on and off with the Yakezie Network spanning a few years now - loosely trying to make my way through the Yakezie Challenge. Heck the Yakezie Challenge Badge was one of the first widgets that went live here at Financially Digital. I'm done being loosely affiliated now - this next round, the Epsilon Class, I will finish the Challenge.

That's the reason for this post. It's to make my announcement to everyone in the Yakezie community along with creating some accountability for myself. So if you are a member of the Epsilon Class please leave some love and introduce yourselves. I can't wait to get to know you and help you all make your way through the Challenge as well. Big thanks to Sam over at Financial Samurai for kind of keeping an eye on me and never really letting me get to far off track - I'm doing this for me and the community but a little piece of me is doing this to show you that I'm worth being on that list :)

Save on Mortgages by Overpaying

2012-02-14T20:46:05Z

For homeowners everywhere, times are tough. If you have a mortgage, finding enough money to continue with payments can be tricky, especially with the cost of food and utility bills skyrocketing. Failing to keep up with payments could make your predicament even worse. Using a mortgage calculator can be helpful when working out much you need to pay off, but what do you do when you find that you’ve more to pay off than you realised?

One method that could prove useful in getting your mortgage cut down to size is overpaying each month. Although that may seem a bit of a stretch for property owners hamstrung by the seemingly astronomical cost of living, but in the long run, it can help save you money. Starting to make even a slight overpayment each month on your mortgage means you get a little closer to owning your home in full than you were before you started.

Perhaps the biggest benefit of overpaying each month on your mortgage is the long-term saving you will make from additional interest payments. If you overpay more often, you end up making less individual payments, which means less interest payments. As a mortgage is perhaps the biggest long-term expense most people face, it’s best to get it out of the way as quickly as possible.

The fact that the base interest rate has remained static at 0.5% for months on end has made it easier for people to pay their mortgages off. However, finding the spare cash to make overpayments is tricky. However, if you do have a bit of spare cash lying around in a savings account, it’s worth bearing in mind that, once the economy begins to recover, the interest rate will start to rise again. Taking that into account, use this situation to your advantage now by overpaying using some of that untouched cash.

Mentors: We all need them!

2012-02-10T17:05:46Z

This is the third episode of Financially Digital tv and if you were thinking that the editing was getting a little better - your wrong. Well not all wrong it's just that I'm still not 100% with the motion graphics but it's the content you should be focusing in on right?! Exactly.

This video is all about mentoring. We cover a few quick points about why having a mentor is important and how you can go about finding them and making the best of them. One bonus is the microphone - at least the audio will be better this time around. Baby steps.

Give a listen and hopefully it'll inspire you to go out and find a mentor - or at least someone to talk to who might be able to give you a few pointers.

0% Credit Card Offers: What it Takes to Get Approved

2012-02-10T16:45:08Z

If you are planning to apply for a 0% credit card, you should expect your credit card application to be heavily scrutinised by the bank or credit card issuer. Banks and credit card companies are very careful when it comes to who they approve for 0% credit card offers because banks do not make much money with these type of offers. In many cases, they will usually only approve applicants who have a long history of not carrying over large unpaid balances and make timely payments on their existing credit cards.

Don't Be Late

Consumers who have only recently started making timely payments on their credit cards may have difficulty getting approved for a 0% interest credit card. This is true even if a consumer has an excellent credit score. And it transcends borders too. If your goal is to get approved for a 0% credit card, whether you are in the UK, USA or even Australia, you should definitely make plans to pay on time and pay off the balance each month. Consumers who only make the minimum payment on the balance may have difficulty getting approved for any competitive offer. This is because banks and credit card companies generally do not want to extend 0% interest to applicants who carry large balances or only make the minimum payment on their credit cards each month.

The Importance of a Good Credit Score

When reviewing an application, banks and credit card companies typically only approve consumers who have an excellent credit score and a demonstrated ability to make timely payments on their credit cards each month. Banks and credit card companies that offer 0% credit cards are doing consumers a favour. Institutions that offer no interest credit cards are taking a tremendous risk. Other than annual fees, banks do not make any money on these credit cards unless the consumer uses them make purchases (which is not advisable). Consumers who are approved for a 0% card tend to present a lower risk, have excellent credit scores and a long and excellent history of paying on time and in full.

How Much Are You Repaying?

In addition to paying on time, banks also check to see how much consumers pay each month on their existing credit cards. Banks want to know if the applicant is paying in full or only paying the minimum. Since banks that extend 0% interest rate credit cards to consumers make no money on any unpaid balances, these banks will be more inclined to approve an application when the consumer pays on time and does not carry over large balances each month. Consumers who have large unpaid balances on existing credit cards will probably be declined for a 0% credit card.

In Conclusion…

Consumers who are interested in applying for a 0% credit card must make timely payments on their existing cards. In addition to making timely payments, consumers should never carry over high balances each month. Since credit history and scores are heavily scrutinised, you want to make certain that you start making timely payments and pay as much of your balance off on all of your existing credit cards before applying for a 0% credit card. By taking the time to make sure all of your bills and credit cards are paid on time and in full, you will definitely improve your chances of getting approved for a 0% credit card.

Contributed by Finance Choices, a UK based independent consumer comparison website offering thorough reviews and insight into a range of products.

Where's my bailout?!

2012-02-09T14:39:56Z

This is a short post because I want you to take a look at the link I have posted below. The link takes you to an ebook written by my actual boom co-author Thomas Fox. It's a free ebook about helping you find your own personal bailout. It is branded by his company and while it does offer a bit of information about who his company is and what they do - there is a ton of great information that you will instantly be able to implement to better your personal economic situation.

Thomas Fox has been a financial professional for over two decades so I encourage you to take a look at what he's put together. Here's the link: Where's my bailout?!

ALSO: there will be a new episode of FDtv today! I'm finally done jump cutting it together and figuring out motion graphics. Look for it lat today.

Really ReWorking It!

2012-02-07T15:40:57Z

This is going to be a quickie type review because I was just so excited to share what I have been reading with all of you. I know I'm late - but hey I have (used to have) a pretty long list and a bad case of butt-in-workseat-syndrome. So hope you enjoy the review!

REWORKI’m not even done with the book yet but I had to get something up here. Think of this as a review in the making. The book I want to spend a few minutes going over is “ReWork” from the guys over at 37 Signals. It’s a book all about revamping how you look at the work you do - whether for yourself or for someone else.

The book is comprised of 1-3 page chapters that make for a really fun read. There are great little hand drawn graphics and illustrations that help bring some visualization to the chapters. Each chapter is just a tell-it-as-it is type conversation between you and them all about making your business better. So far one of my favorites has been all about the importance of keeping meetings short or avoiding them all together. The overall feeling I’m getting as I’m making my way through the book is that it’s aimed at making you more efficient. To be more efficient you have to have a clear understanding of what is really going on around in you in your workspace. Then you can start to apply some of their principles to help make you better - in a really fun way if that makes sense.

Another big take away for me so far is taking concepts and practices out of the abstract and making them tangible. For a strategic planner like myself it’s important to remember that there is only so much good that projections and extrapolations can bring to the table. The proof comes in the execution and application - moral of the story: less talking more doing!

Ok.. ok.. one more for me then I promise we will get back to the book. One more thing that I giggled at and totally identified with was the difference between doing busy work for works sake and actually being efficient. If you prioritize and work smart there is no need to be working extra long or late on projects and assignments. There is no extra credit in the real world for how long you can sit in front of your computer screen all in the name of “work”. There is also no shame in doing what you have to do so that you can move on. Now when I look at my To-Do lists I try to knock everything out as best as I can without a preconceived notion that this has to take me X amount of time.

Like I said earlier I’m not even done with this book yet and I had to share some of my thoughts. I think it is a great read for anyone, any where, who needs a little juice in the ol’batteries. It’s fun and the lessons and philosophies are instantaneously applicable. I’m even doing it right now. I’m writing, no distractions, and as soon as this is up I’ll use this quiet time work momentum to tackle something else. It was one of the chapters - check it out.

If you have read it I would really love to hear what your thoughts are about the book or any great stories you have about it. So, leave them in the comments below and let’s get chatting!

Save Money on Car Insurance

2012-02-01T18:24:27Z

Save Money on Car Insurance

We are all looking for ways to save in the wake of the failing economy. Families are trying in every way possible to pinch pennies whether it be by buying the generic brands or by choosing to become a one car household. However, there are other, sometimes easier, ways to save on monthly expenses. One of the easiest ways to do so is through your car insurance. If you wish to reduce the amount you spend on your monthly premium, consider trying some of the following:

Increasing Your Deductible

The lower your deductible, the higher your insurance rate will be. So if you consider yourself to be a safe driver and know that you could afford a higher deductible if necessary, choose the higher deductible. While it may require you to pay more out of pocket should you be in an accident, you will most likely save money on your policy month to month, and in the long haul – assuming you are not in an accident.

Shopping Online

Just like in the retail world, shopping online for car insurance one of the best ways to save on your car insurance. In addition to offering free insurance quotes, many companies will offer certain discounts to those who purchase their insurance online while others only allow their policies to be purchased online. So before you spend the money on a high priced policy with a storefront agency, consider shopping online.

Going All-in-One

By combining policies you can easily save a few dollars off your car insurance. If you own a home, consider combining your car insurance and home insurance policies together to save money. If you don't own a home, you can still get the same type of money saving benefits by combining renter's insurance with your car insurance – often saving up to 15 percent off your monthly premium.

Saving money doesn't need to leave you unable to enjoy life on a day-to-day basis. While there are some switches that are necessary and not always fun – like reducing the amount of money you spend on going out, there are a few other switches that are painless, such as reducing your car insurance premium. By making some changes to your policy, you can save money each month and increase your savings which is something we would all love to do right now.

High School Econ and Focusing On Fundamentals

2012-01-30T18:56:50Z

PLEASE VOTE: I'm trying, in a last minute effort, to get Financiall Digital to be the Best Local Blog for the Valley Advocate's Best of 2012. Please take a minute to vote and help Financially Digital get there! Thank you in advance :) Here's the link:http://www.valleyadvocate.com/ballot/ballot.cfm

This morning I was a guest speaker in a high school economics class. This week the students were making their way thought business and market structures. I was ready to jump in their talk about being a consultant and how I help people choose the right models and navigate through all the perfect competitions, oligopolies, and monopolies out there. That’s not really what happened though. First though I have to let everyone know that it was a blast and the class seemed to get a ton of value out of our conversation but, it didn’t go anywhere near how I thought it would.

I did what I just described and walked in spouting the vocab from their text books and asking about the chapter they were making their way though. That was crickets. After a little prodding it came to my attention that they did not exactly do all their readings. Not only that but they had a really obscured view on how businesses and entrepreneurs actually get to be successful. In that moment I was grateful. It’s because of the consulting that I do, the teaching, and the things I think are nerdy (like reading) I take advantage of the fact that the general public has no idea what a business does outside of the consumer experience. So this post is going to be a refresher for all you entrepreneurs out there who have become so bogged down by the technical logistics of running a business that you may not have reflected on the basics in a while.

1. Take a look at your business plan. If you don’t have one start one. Has your business changed or evolved? Are your customer demographics the same? Is the location you are in still the right fit for you? If you own are thinking about a small business try to remember that you started because you didn’t want to just show up at a job. Make sure that the hours you are putting in now have the same target as the hours you put in at the begining.

2. Who are your customers? Are you providing products or services that you like or are you catering to your audience? One thing we talked about in that class today was elasticity and spending habits. The take away their was that your customers might not be spending clones of you. You can not define a brand, product, or service by just keeping what your personal preferences are in mind. Even if you are targeting a super specific niche you still have to do some kind of research on an aggregate level. You aren’t selling to you!

3. Look at your business structure. Starting out the sole proprietor might have made sense. If you have been an entrepreneur for a while and have seen some growth you might want to revisit the pros and cons of the different ways to organize your business. Tax season is upon us and no one wants to be liable for more than their fair share.

4. Are you competing on price alone? There are a few businesses where your pricing scale will be one of your top appeals. Unless you are Wal-Mart, a wholesaler, or something like that odds are you will need to focus on the consumers experience. How are you branding yourself? What makes you unique or different? Why would I want to come in and be a patron - and keep coming back. Showing up everyday and doing the “work” of your business can sometimes force you to lose sight of your customers. It’s easy (and naive) to think that they will always just keep coming back.

Take a few minutes and reflect on what you have going on. Whether you have a small business, a hobby, or even your financial plan. As times and economics change you HAVE to change too. Well, if you want to be successful any way. It’s not always easy when you are the only one running the show to make time for everything else that is not directly putting dollars in your pocket..I know. But it is the extra stuff that will help that dollar amount grow from week to week and keep you wanting to show up yourself.

Online Credit Card Comparison: What You Need to Know

2012-01-27T16:18:25Z

When comparing one credit card against another, you quickly see that not all cards are created equally. While they all allow you to accomplish the same basic goal of making purchases on credit, the way they go about it differs greatly. If you want to be a savvy shopper, it's important for you to choose a card that fits your needs as an individual. And if you have a small business, the methodology presented below will also help you identify which business credit cards are the right fit for your business needs. Comparing credit cards online can provide you with the information you need to make an educated decision. When comparing, there are a few factors that you'll want to look at to ensure that you make the best choice.

Annual Fee

One of the areas that you'll want to look at when comparing is the annual fee. Many credit cards charge you an annual fee just for having an account. This fee is charged once a year and is typically a fixed amount. In some cases, the credit card company will waive the annual fee if your balance goes above a certain threshold. It is important to read the terms of the credit card to find out if your annual fee can be waived once you reach this level. Some credit cards do not require an annual fee. Without looking at the other factors, choosing a card with no annual fee usually makes the most sense.

Interest Rate

Besides the annual fee, the other way that credit card companies make the majority of their money is with interest charges. These interest rates are multiplied by your card balance to determine how much you pay in interest. Credit card interest rates can vary greatly from one case to the next. Some credit cards charge interest rates as high as 20%, while others have more affordable rates at 10%. This can be a big difference if you typically carry a large balance on your card.

In addition to looking at the basic interest rate of the credit card, you should also look at the introductory rate. Introductory rates are typically lower than what the credit card will charge you over the long-term. For example, a credit card may offer an introductory rate of 0% for the first 18 months on purchases or balance transfers. Then after the 18 months is up, the rate jumps up to 15%. Finding a card with a 0% introductory rate can be beneficial if you want to transfer a balance from another credit card account. This will give you 18 months of no interest in which you can pay down your balance. Find out how long the introductory period is and then find out what the interest rate jumps to after that period is up. Also clarify whether the introductory interest rate applies to balance transfers and purchases or just balance transfers. Each credit card offer is different in this regard.

Rewards Programs

When shopping around for a credit card online, you also have to look at the rewards programs that they offer. In today's credit card market, many cards offer customers rewards for using their cards to make purchases. It is important to shop around and look at the terms and conditions of these programs before making your selection. If you do not choose the best rewards program that you can get, you are essentially leaving money on the table. These rewards can be used for free things like airplane tickets, hotel accommodations, food and electronics.

When looking at the rewards programs, find out exactly how you accumulate rewards. Some credit cards give you one point for each dollar that you spend on the card. Others give you two points for each dollar that you spend on the card. In certain spending categories, you may be able to get even more points for each purchase that you make. Then take a look at how many points it takes to get something in the rewards program. If the program that offers double points requires you to get twice as many points to get something you want, you wouldn't gain anything by selecting it.

Once you've weighed these factors, fill out the application and get approved for the card you want. Just be careful that you don't use more credit than you can afford to pay back in the future.

Contributor Andy writes about credit cards for the Australian credit card comparison website, CreditCardHelp.com.au. Click here to go to their website where you can find more of his writing.

4 Trends Not to Forget About For Investing in 2012

2012-01-24T14:27:55Z

Here Are 4 Trends Not to Forget About For Investing in 2012

2012 is here and as is the case with the dawning of any new year, investors take a look back at what worked and make plans for the coming year. 2011 will be a year to forget for European investment markets as a whole but some investors still managed to come out ahead. Will 2012 bring more of the same and how should we prepare for a year that already has investors understandably nervous?

1. Dividends Will Work

It has been such a common theme that we’re tired of hearing it. We should all have a portfolio of dividend paying stocks that guarantee us income even when the market is severely challenged. We heard this advice all year and it worked.

Not only were investors looking for sources of income when their growth strategies broke down, but as money poured in to these defensive names many of these stocks went from boring income names to more exciting growth names. Watching dividends enter our accounts is about as thrilling as watching paint dry but as Europe weakened, dividend stocks strengthened.

Don’t expect that to change. Until the European debt crisis is a distant memory, low beta, high dividend names will continue to work.

2. Don’t Try to Make Money

Sometimes we play defense and sometimes we play offense and 2011 was a year for defense. Making money took a back seat to trying to preserve capital. We were happy if we minimized our losses and we were elated to see any returns that were green in color. 2012 isn’t setting up to be a year of offense.

Once again, investors will start the year in a defensive position and hope that the latter part of 2012 may turn around but until then, greed will take a back seat to fear.

3. But we’ll Look for Opportunities

Just because we’re thinking defensively in our trades doesn’t mean we won’t jump at the chance to make some exciting long term investments. Challenging markets aren’t fun but for long term investors, severely discounted, high quality companies are as good as gold. Taking a long term position in a company that has seen a 30% or more decline because of the overall market is a sale not to be missed.

Not only does that set up a fantastic growth opportunity but it also increases the dividend yield.

Profitable investors know that there is little money to be made when you trade with the masses. The stock market is already on sale and if Europe remains under pressure the sale prices might become even better. Putting your emotions aside and buying when the market is at its weakest will eventually pay off in a big way.

4. Say No to the Banks

With the thousands of stocks on the market, there is no reason to take a chance on a sector that has proven for multiple years that it doesn’t want to perform. 2011 was a year where some of the most respected analysts continually said that banks have bottomed. They were proven wrong many times over and investors lost money. At some point in the future banks will outperform the markets. They will return to the glory they once had and the investors who buy the financials and wait will see returns that far outpace the overall market.

But we don’t know when that will be and our money will work harder for us in other sectors. Nearly every corner of the markets did better than banks and that probably won’t change any time soon.

In Conclusion, We Don’t Know What Will Happen

Although the financial media will bring us thousands of guests in 2012 who will tell us where the market is going, the truth is that they are making a prediction based largely on their opinion and biases. Nobody knows where the markets will end up at the end of 2012 or even the end of January.

What we do know is that markets will continue to be choppy and volatile. They’ll be hypersensitive to world economic news and short term trading opportunities will present themselves amidst that choppiness.

Make cash a large part of your portfolio in 2012. Not only will you have funds ready when the market presents an incredible buying opportunity but also to avoid the heavy volatility that will certainly continue.

Tim is a stock trader and freelance writer who writes reviews of the best credit cards for CreditCardCompare.com.au, an Australian comparison website where he recently wrote a related post on the rules for investing in stock. If you'd like to track his work on CreditCardCompare.com.au, follow @thecreditletter on Twitter.