Right of the Credit Report Owner

As the owner of the credit report, you have the right to get informed about every fact included in the credit report. You also have the right to know about the businesses that are responsible for the inclusion of the facts into your credit report. The credit bureau is also bound to allow you to see the business names that have applied for getting access to the credit report in the previous 1 year. The credit report owner also possesses the right to know the name of employers, who requested for his or her credit report during the previous 2 years. On paying a certain amount as fee, you will be allowed to know your current credit score.

Duty of Credit Bureau

The credit report should never include any outdated info (info of the last 7 years for normal deals and info of the last 10 years in case of bankruptcy are recognized to be valid). All the outdated info, which also includes the negative information about your financial dealings for instance due payments, debt collection, repossession, foreclosure etc, must be eliminated from the report. If the old info is not eliminated from your credit report, you can opt for credit report disputes to get the facts removed from the credit report.

I used to regularly use my decade old card that offered an interest rate of 10%, a far cry from the interest rate it now charges of 15.99%. Not even the threat of terminating the card and simply going elsewhere fazed, nor the fact that I was an old customer of theirs. Nothing doing…I had to pay up, or ship out. So what’s a customer to do at this point? I did what any customer should do…I started to pay by cash for everything I could. In fact, there are movements out there such as Suze Orman’s back to cash movement that urges customers not to use their credit cards and thus send a strong message out to credit card companies this way.

There are definite benefits to using cash as a payment method too, such as:

Not being able to overspend:
if you don’t have the money, there’s no way you can spend it, now can you?

No annual or monthly fee:
For every $1,000 of debt that you have, you’ll owe $160 worth of debt. Now do the debt and see how much using that credit card really costs you. If you can pay off the balance in full each month, all is good. But not everyone can do that. And what if you get laid off or can’t work for a while due to injury? This is why cash makes so much more sense.

Instant pain:
Credit cards anesthetize the pain of buying something, and the real financial impact of it doesn’t really hit you until later, sometimes much, much later. With cash, that pain is instant and so  it makes sense to pay with cash if only to be aware of the pinch of buying something.

The thing is there is a lot of confusion surrounding homebuyers tax credit. There was one that was mandated in 2008 that is particularly the cause of great confusion and it amounted to 10% of the purchase price or $7,500, whichever was less. But here’s the thing; that was not a tax credit as much as it was a loan. The government is looking to you to pay back this amount of money over the period of 15 years. It is no matter thhat it is a zero interest loan; it is still a loan nonetheless. So if you bought a home in between April 8, 2008 and December 31, 2008, the government is looking to you to pay back this tax credit over and above your taxes due for the year.

And so, the moral of the story is a very simple one. A bit of patience on the part of those that bought homes in 2008 would have seen them get a much sweeter deal in 2009. They would have got a real tax credit instead of a zero interest loan. If you were a first time homebuyer, or if you met certain stipulations, you could take the government up on its offer and avail of tax credits for buying a home in 2009 and 2010. Those that did so got a true break; a tax break that would not have to be paid back at all.

If you did do so, you could effectively claim tax credit for being a homebuyer when you file your 2010 taxes. There is the clause of having to pay it up if you don’t live in it yourself for 36 months. So if you decide to move out before 36 months or if you rent it out, you forgo the right to avail of that tax credit. Military personnel and intelligence personnel are exempt from this if they already live in government quarters or are made to move on job-related grounds to a place that is more than 50 miles away. All in all though, you got a bum deal if you availed of the tax credits of 2008, and it sucks to be you.

For instance, if you are spending more than you are earning, increase your income somehow or cut back on your expenses. It’s all about smart money management and it doesn’t take a rocket scientist to figure it out. For instance, I recently started teaching graduate students part time as a way of increasing my passive income. I’m sure you too can come up with an idea of your own. Also, save at least 10% of your net income each month. That’s enough (in the long run) to be able to achieve all of your financial aims and then more. Come up with a budget if you need in order to make sure your spending is never more than your earnings. It works for many, it can work for you as well.

If you have debt of almost any kind, pay it off first. The only time it’s excusable not to do so iis when some need needs to be paid off. For instance, if I had an internet service provider’s bill to pay off and credit card debt, I’d pay the latter off first. But if I had a mortgage, an internet service provider’s bill and credit card debt to pay off, I’d pay off the mortgage, then the debt, then the service bill in that order. Garnering interest-laden debt over time is perhaps the single-biggest impediment to building wealth. That’s because you can (or should) really start saving only after paying off your debts.

For something as simple as an auto loan, try and pay as much as possible in cash since you can save thousands of dollars over a lifetime by not paying the interest charges on it. Those savings you put away each month? Yeah, you can use that for this. Also, invest your funds in income securities. If you’re saving for something in the medium to long term, sacrifice the growth of equity for the assurance of fixed income. These also minimize credit and interest rate risks. As long as the principal amount is secure, 1% of interest will make no difference to you in real terms. If the value of these securities don’t fall with a rise in interest rates, you will be well on the way to building wealth.

‘I always knew I was going to be rich.
I don’t think I ever doubted it for a minute’

He always knew he would become rich, even when he did not have money to meet monthly expenses. And he became rich, simply because he believed it very strongly.

Unwavering Belief

Everyone leads a normal life, by working few hours a day, enjoying their weekends, and hating their lives. However, few have ‘crazy’ ideas in mind which they believe in. They strive it happen; challenge themselves and other; take the road less traveled, and follow through till the end.

This system works similar to a car. If you don’t have gas in your car, it wouldn’t move at all, let alone right direction. Similarly, if you have a crazy thought in mind that you believe would work, it requires indestructible, unwavering belief to sustain with the idea.

Do You Have Any Unwavering Thought in Your Mind?

Do you have something in your mind with guarantee it will happen in future? Are you sure you will meet your financial targets? Are you sure you will lose ‘x’ pounds by the end of this year? Are you willing to anything to achieve your goal, even if it means taking to one way ticket that can change your life forever?

Most of the obstacles we face are simply because they are in our minds. Things are as it is. They don’t change. They become obstacles simply because we think they are obstacles.

Once you have this indestructible belief in your mind, you will face every obstacle to achieve your goals.

How Do You Have This unwavering belief in your mind?

This is not hard at all. You simply have to affirm every day you are smart enough, and worthy of becoming rich. You cannot make yourself believe by reading this post or by reading any other post, but by setting a goal, affirming and re-affirming in your mind every day, and taking steps to reach closer to your goal each day. And, trust me on this, each successful step will make your belief even stronger.

We All Are Same

Yes, we all are same. However, the one who will have indestructible belief in his mind is the one who will win. There are innumerable opportunities lying around here. The world wants someone who believes in his dream and grabs those opportunities. Warren Buffett did exactly the same.

Main expenses during college life were food, entertainment, and perhaps, temporary shelter. However, life after college wouldn’t be so simple and entertaining. If you spend like you used to in college, life would be difficult. Here are some tips that can help you take care of your finances after college.

Don’t Purchase a New Car

Most graduates want to reward themselves for all the hard work they had done in school. And the reward is new car. However, unless you can pay for it in full, don’t purchase. If you had a car in college, use the same one for a while, until you save some money for new car. But don’t go for a new one simply by applying for credit. It will put you indebt for another five years with over $300 payment every month.

Don’t Spend More on Credit Card Purchases

If you have money in your savings or checking account, withdraw some and purchase things in cash. Credit card can be good, at times. However, most people use it as a tool to avail easy credit, and fall into the trap. If you use it, make sure pay balances in full. The debt may seem to be very small in the beginning. However, it might go up to hundreds thousands within few years.

Repay your Debt Immediately

When you are out of your college, you don’t have many responsibilities like paying huge bills or paying for kid’s education. This is time when you can save some and repay your debt, if any. If you have had a credit card or student’s loan, chances are you might have accumulated debt to repay. Create a plan and get rid of it before it becomes too big to manage.

Get a Job Soon

Most graduates think they deserve a high paying job in a reputed company simply because they have worked hard and become graduates. However, with hundreds and thousands graduating every month, and with increasing unemployment rate, it’s difficult to get a very high-paying first job. Focus on getting exposure to things and experience instead of targeting high-salary.

Reduce Expenses

This is probably one of the most difficult tasks for college graduates. However, reducing unnecessary expenses is the best method to get your finances under control. You can do this simply by renting a modest apartment instead of lavish one, not using credit cards for every purchase, using used items, and so on. This will help you save money every month and direct funds in the right direction.

There are several such things you can do to get your finances right. However, most important thing is to be conscious and responsible. Earning money is not as difficult as managing it. It requires a bit of alertness, patience, and planning to get your finances straight.

Strengthen Your Emergency Fund

Dont fret if you dont have an emergency fund. You have a great opportunity to start with $1,000. if you already have it, add this amount to your fund. The best part about emergency fund is they can be used any time, any where during emergencies. You don’t have to liquidate it like other investments. Hence, having such a fund should be your priority.

Consult a Financial Planner

You can skip this step if your finances are in place. However, if you have accumulated enormous debt, and don’t know how to repay them, consult a financial consultant, who can help you get out of such situation. Often, we don’t visit a consultant because their hourly charges are around $200. But when you have $1,000, don’t bother about the fee.

Invest in Top Fund

Hire a portfolio manager and invest your money in top performing mutual funds. One of the best products you can invest in is a non-managed low cost mutual fund. There are many other funds you can invest in, which can provide you high returns as well as tax-breaks.

Home Appliances

If you have a computer at home that needs upgradation, spend few hundred bucks on it. You can spend the remaining amount on replacing existing, worn out items into more energy-efficient gadgets. Instead of using a simple bulb, you can replace them with CFL bulbs.

Help People

if you have enough money, you can spend this $1,000 to help people who are deprived of things that you are enjoying today. If you don’t want to give it all as charity, you can finance a business project on Kiva, plant some trees, or buy sheep for farmers. If you give it as charity, you can expect a good tax deduction in this financial year.

Join a Fitness Club

However, do not pay for the entire year if you are not sure about your commitment. But investing in your health is better than investing in stocks, bonds, or mutual funds. Find a good gym with all necessary equipments, join it, and visit regularly. You will be pleased with your decision once you notice changes in your body fitness.

Retirement Fund

If you have thought about your retirement fund yet, start planning it today. The earlier you start, the more benefits your will receive in future. Open an IRA account or invest regularly in your employer 401k plan. Any amount invested today will only help you to have a better life tomorrow.

Repay Your Credit Card Debt

This should have been on the top of the list. If you are still reading, and if you have debts to repay, put the entire amount toward repayment. This will also help you save additional dollars as you wouldn’t have to pay interest.

Sharpen Your Skills

You can use this $1,000 to learn new skills. Take up a crash course in computers, or learn to play a musical instrument. There is so much to learn, if you are ready to spend some time and money. You can also have financial magazine subscriptions that can help you make better investment or debt repayment decisions.

Invest For Your Kids

If you have kids, invest in their names, for their better future. You can have their portfolio designed, with investments in low risk products.

There are probably many other things you can do with unpredicted $1,000. However, spending it carelessly wouldn’t be a wise idea.

Habit 1: Working For Money

Don’t expect money to come to you, even if you have bought all the lottery tickets. To earn money you need to work. If you don’t have an intention to earn money from your work, you will end up working for charity. Work hard, earn more, be proud to be rich.

Habit 2: Spend It

The more you spend the more you want to spend. Hence, you work more and earn more to spend more. That’s life. You cannot sit idle and watch TV. There are many things you can do with money: buy new pair of shoes and clothes, go out with your family, buy a gift for your loved ones often, go on a vacation, and so on.

Habit 3: Don’t Borrow

If you borrow money to spend, you wouldn’t have the urge to earn it. You know it’s readily available when you need it. Besides, if you are late in repaying it, you pay more (with various penalties and fees). Why do you want to spend money on something that’s not worth it. Spend in cash, utilize every penny you have.

Habit 4: Save & Invest Money

Alright, spending will certainly want to you to earn more. However, if you don’t save, you will have to borrow some amount. Besides, saving is the only way to grow your money. You can deposit some amount every month in your savings account, and find suitable product to invest in. Only keeping money in your account can also help you earn some interest every month. There are several other products like stocks, bonds, mutual funds, real estate, certificate of deposits, and so on.

These habits are good, and can help you make rich. But it certainly doesn’t guarantee anything. Having the right attitude is what makes the difference.

That’s probably a very good idea. But until you don’t act on it, it would only be an idea. Besides, if you have a closer look, you will realize, more than passive income, you can earn money through your active income (current job) simply by sharpening your skills.

Having a passive income is a good way to earn extra money. However, not every idea can help you earn $500 per day. But job is a place where you can get significant hike. So, work on your skills instead of nurturing some passive ideas.

2.    I can save more money, if I try a bit harder

You can hear a similar statement by an obese person. They know they can reduce weight by consuming less calories per day, but they aren’t ready to reduce it. Besides, simply trying harder wouldn’t help you achieve your goals. You need to know the right tactics as well. If you want to save money, simply saying ‘I want to save money’ wouldn’t help. Know how you can do it.

3.    I will have a budget very soon

Yeah right. You have been saying this since decades. And you even tried it many times. But you relize:

• It’s very hard living with a budget
• We don’t like limiting ourselves to anything
• It’s painful

So, what’s the solution? Forget about the conventional budgeting method you have always heard about. Spend extravagantly on the things you like, and cut down expenses mercilessly on other expenses.

4.    I Will Start Investing in Stocks

That’s a very good idea, but here is fact that you must know: Less than 5% of people who say this actually invest in stocks. Besides, investing does not only mean picking up stocks. There are several things you can start with: 401k, IRA, Savings Account, Mutual Funds, and so on. If you have more money to invest, buy a property.

5.    Greedy Think About Money, I Want to Stay Away From It

Then why don’t you give up using money. The fact is, you cannot stay without money, even if you are a monk (with or without Ferrari). So, why not make efficient use of it? Rich people get richer because they plan their finances well.

These probably lame excuses to stay away from managing your finances. The more you have them, the more you will suffer. It’s better you accept it the way it is and start making good use of your money.

1.    Don’t Eat Out Often

If both the spouses are working, this is probably a difficult task. They can start with cooking food at home once a week.

2.    Take Lunch at Work

Again, you don’t have to do it everyday. Carry your lunch 2-3 times a week. For the remaining days, join your colleagues.

3.    Limit Shopping

I promised I wouldn’t deprive you of anything. But you don’t really use every thing you buy. So why do you buy it in the first place?

4.    Buy in Bulk

Of course you cannot do this every time you go out to buy something. But few things like tinned goods, toilet paper, shampoo, body wash, and so on, that can be beneficial if you buy in bulk.

5.    Pay Bills on Time

This can be done only if you become organized. Paying bills on time could save you late fee every month. Besides, it would also help you to improve your credit score. This is probably the easiest one among given 10 ways to save money.

6.    Save Money at ATM’s

Not every bank allows you unlimited transactions at any ATM. Some do, some charge fee after few initial withdrawals. Simply taking care of this thing can save you few bucks every month.

7.    Don’t Use Credit Cards that Charge Annual Fee

Why do you want to pay annual fees, when there are companies that provide cards without such fees?

8.    Don’t Buy New Car Often

Maybe this rule wouldn’t be applicable to everyone. However, few people buy cars every year or two. Simply using a car for a longer time can save you considerable amount.

9.    Don’t Buy on Impulse

Impulsive buying is probably the costliest habit we can ever have. Stop buying on impulse. Wait till you get the best deal.

10.    Buy Used Items Whenever Possible

No, you don’t have to be embarrassed about it. You can buy a used book instead of getting a new one. It wouldn’t affect the content quality.