Archive | Personal Finance

Payday loans can be good for you

For those of us who are paid on a monthly basis, the days before the next paycheque can be a worry. Bills have to be paid, life goes on, and money is inevitably tight, but what about those life emergencies that occur every now and then? For example, if your car breaks down and you can’t afford to wait a week to get it fixed: this is when a short-term cash loan comes in handy.

Much has been written about how payday loans carry high interest rates, but are they really any more expensive than conventional loans? The truth is that while the interest rates are high, the actual cost of a fast loan is minimal if you borrow the money sensibly; you are, after all, only borrowing a small amount, and for a very short amount of time. The advantages don’t stop there, for these loans are surprisingly simple to access, and the result is money in your account almost instantly.

Research has in fact shown that borrowing a small amount – say £200 – via a payday loan is cheaper than taking out a conventional bank loan. If you keep to the rules by paying the loan back when agreed and you avoid any potential penalties such as missed payments, you can have instant money for that emergency at an affordable price.

Most people who take out payday loans do so because they need a small sum of money for a short time – a week or two is generally the maximum time that a loan is secured for – and the agreement is to pay it back on the date you get paid. This will be done automatically by direct debit as soon as the money is in your bank on your payday or another previously agreed date.

Many such loans – and there are plenty of companies offering them nowadays – can be secured simply by filling in a quick online form, and acceptance is agreed on the spot often within just a few minutes. Many offer small loans that do not require any security, and some are willing to lend to people with poor credit ratings. The general case is that the first amount you can borrow will be limited, and if your loan is repaid successfully and on time, future borrowings can be for greater amounts.

Payday loans are quick and convenient, cheap and useful, and are not the vastly expensive option that they are sometimes portrayed as. Careful use – borrow only what you need, when you need it – and consideration make taking out payday loans a very sensible way to borrow money for those moments when you need to, such as if you can’t make the payments you need to for household bills or other essentials.

Posted in Personal Finance.

3 Resources You Need to Know About Before Filing Your Taxes

3 Resources You Need to Know About Before Filing Your Taxes

So you’ve spent the last month dreading the thought of doing your tax return, but the day has come and you know it’s time to get it over with. You sit down and pull up your tax sofware, and start answering questions. Name? check Address? check….Then, you run into that question that you’re unsure about.

3 Resources You Need to Know About Before Filing Your Taxes

It might be the number of deductions you can take, whether you are eligible for this credit, or how many business expenses you can claim. Whatever it is, you don’t want to get it wrong and have the IRS come knocking at your door. But, you have other work that needs to get done, and you just want to get this damn tax return over with!

Here are three options you should consider that I’ve tried and tested over the years. Each one has its merits.

  1. The free solution – The IRS actually offers a free helpline that you can call to get tax filing help. Since it’s a free service (besides the 15 minute wait time), it doesn’t hurt to try this one out. If you’re lucky, you’ll get in contact with an enrolled agent who can help you with your question. However, the help service is notoriously spotty, with a recent Washington Times study showing 3 out of 10 people who call the toll-free helpline won’t get through to a human being, and those that do are often redirected to the IRS website.
  2. The costly solution – Hiring a last-minute CPA or tax assistant to answer your question is also a popular solution (especially for business owners). However, beware that this costs anywhere from $100-200 per hour, and is limited to availability as the tax deadline approaches. The benefit here is you will be getting someone to do your taxes for you, whose job is to keep up to date with the current tax code.
  3. The happy medium – There’s a clever new website called Task.fm that offers a place where tax professionals will answer your personalized tax questions quickly for a set cost. For those of you with one-off questions that need to be answered, I would highly recommend looking into this. For an affordable rate (~$20), you get a certified CPA who will answer your question immediately. Not a bad deal if you ask me!

All said and done, what you’re looking for is a quick, accurate, and affordable answer to your tax questions.

If you have the disposable income and are willing to pay for someone to do your taxes, hire a CPA (make sure you do your due diligence!).

If you are willing to do the gritty work of reading and understanding the tax code yourself, use the IRS helpline.

If you just want an answer quickly for an affordable rate, go to Task.fm. (Click here to bookmark).

Posted in Finance, Personal Finance.

What is a DRO?

What is a DRO?

A lot of people end up with serious debt problems and need to be declared insolvent – but bankruptcy isn’t right for everyone in that situation. Every year, many thousands of people enter a DRO (Debt Relief Order) or an IVA (Individual Voluntary Arrangement).

What is a DRO?

For struggling borrowers in England and Wales, bankruptcy hasn’t been the only available form of individual insolvency since 1986, when IVAs were introduced.

In 2009, the situation changed again, with the introduction of the DRO.

What is a DRO?

A DRO is a form of insolvency that was introduced to help people in a very specific kind of situation – with very little in the way of income or assets, and relatively low debts. If you don’t fit the criteria, a DRO simply won’t be available to you. You can find more on the requirements of a DRO here.

Basically, a DRO, if it goes ahead, will last for 12 months. If your circumstances haven’t changed in that time, you’ll be freed from all the debts included in the DRO.

DROs don’t actually involve the courts, but are run by The Insolvency Service itself, working with skilled debt advisers who are known as ‘approved intermediaries’.

How common are DROs?

As mentioned, DROs were only introduced in 2009, but they’ve seen a serious uptake already. Last year, for example, over 25,000 people entered a DRO – far more than the almost-12,000 who entered a DRO in the three quarters of 2009 in which they were available.

Given that over 59,000 people entered bankruptcy and over 50,000 entered an IVA, the figure of 25,000 DROs accounts for about 19% of last year’s total insolvency figure of just over 135,000.

The thought of getting out of debt in just one year can be really appealing to many people – especially when their financial situation is poor and unlikely to improve – but don’t forget it’s a form of insolvency. It’ll stay on your credit rating for six years, which will make it harder to obtain further credit, since potential lenders will be able to see you’ve not been able to repay your debts, but entered a DRO.

Where are DROs available?

DROs are only available to people in England and Wales. People in Scotland might be able to take the LILA (Low Income Low Asset) route into bankruptcy, or they might be eligible for a Trust Deed, which is similar in some ways to an IVA.

People in Northern Ireland might have the option of entering bankruptcy or an IVA, but the DRO is not available in Northern Ireland.

Posted in Personal Finance.

American Express (NYSE:AXP) Daily Wish

American Express (NYSE:AXP) has put up a 2011 BMW 328i at half-price with its Daily Wish sale.

American Express (NYSE:AXP) Daily Wish

All those BMW lovers who are planning for a purchase this year, check out the American Express (NYSE:AXP) “Daily Wish” on Thursday, December 16. Because, this is the day which features the brand-new, 2011 BMW 328i at the online marketplace at just $17,262.50.

This will be offered on the last day of Daily Wish’s special holiday sales through American Express (NYSE:AXP)’ Auto Purchasing Program. The sales will be conducted for this limited quantity on a first-come, first-served basis.

American Express Co. (NYSE:AXP) stocks was at 46.12 at the end of the day’s trading on 12/15/2010. There’s been a 14.4% movement in the stock price over the past 3 months.

If you’re looking to make a move on the American Express Co. (NYSE:AXP) shares, make sure you take a look at this analyst advice, from a broad range of industry specialists:

American Express Co. (NYSE:AXP) Analyst Advice
Consensus Opinion: Moderate Buy
Mean recommendation: 1.67
(1=Strong Buy, 5=Strong Sell)
3 Months Ago: 1.9
Zack’s Rank: 6 out of 26 in the industry

We will be monitoring the American Express Co. (NYSE:AXP) share price for changes over the next few weeks.

Posted in Personal Finance, Stocks.

Millions Of Brits Are Shopping Addicts

Millions Of Brits Are Shopping Addicts

AHN News Staff

London, England, United Kingdom (AHN) – The recent global financial crisis and recession failed to stop at least seven million Britons from swiping their credit cards. According to a report by comparison website uSwitch, the seven million shopping addicts are divided into four million females and three million males.

Millions Of Brits Are Shopping Addicts

Together, they charged $36 billion (24 billion pounds) on their credit cards during the economic downturn.

While the women shoppers outnumber the men by one million, the males made up for it by charging more than the female shoppers.

The average amount male shoppers charged to their card was $855 (570 pounds), while those of women was only $450 (300 pounds).

Male consumers, who are apparently catching up on women’s love for shopping, have also entered into a territory used to be dominated by women. According to uSwitch, the bulk of credit card purchases made by men was on grooming.

For skin care and cosmetics alone, the male shoppers spent an average of $507 (338 pounds), versus $286.50 (191 pounds) only for the women.

The gender divide was also felt in shopping for films, technology and computer games since males spent an average of $579 (386 pounds) for those items, while women spent only $279 (186 pounds) for the same goods.

Anne Robinson, head of consumer policy for uSwitch, explained the higher male spending on grooming to good looks and appearance helping men job applicants stand out at job interviews and eventually get employed.

Robinson, however, cautioned British consumers from excessive shopping, especially if buy items on credit because their short-term debt, if not managed properly, may eventually grow too large and become long-term debt.

Article © AHN – All Rights Reserved

Posted in News, Personal Finance.

New Bank For General Electric Company (NYSE:GE)

- General Electric Company (NYSE:GE)’s new online bank will be the first to be set up since the start of the credit crisis

Rumor has it that American manufacturer General Electric (NYSE:GE) is setting up its first online bank in Britain since the start of the credit crisis.

New Bank For General Electric Company (NYSE:GE)

GE (NYSE:GE)’s financial services arm, GE Capital, is looking to take on the High Street banks with a range of savings accounts. It recently set up an online bank in Germany and is believed to be examining opportunities in a number of other European countries as part of a initiative to diversify its funding base with customer deposits.

The online banking sector, which got its start a decade ago with such dressed-down companies as Egg, Cahoot and Smile, came under the public scrutiny when the Icelandic bank Icesave collapsed.

General Electric Company (NYSE:GE) company shares stood at 15.38 at the end of trading on 8/13/2010.

Posted in News, Personal Finance.

Coalition Warn Of Loan Rationing Dangers

AHN News Staff

London, England, United Kingdom (AHN) – British Chancellor George Osborne and Business Secretary Vince Cable are warning banks of the negative effect of loan rationing on the country’s economic recovery. The two will issue next week a green paper on the topic.

Coalition Warn Of Loan Rationing Dangers

According to the Bank of England, more loans are being repaid than loans being granted. Another study by PricewaterhouseCoopers warned that tougher capital rules and the stop of stimulus spending could mean a loss of $1.5 trillion (1 trillion pounds) for the British banking system in the coming years.

Banks maintained there is no demand for loans, while businesses explained they are not filing loan applications for fear of being turned down or they are discouraged by high interest rates. Cable acknowledged the arguments of both sides, but indicated there will likely be no changes in the present lending targets for the Royal Bank of Scotland and Lloyds Banking Group, which received massive stimulus funds from taxpayers.

Since the global financial crisis in 2008, lending exceeded payments only in three months, according to data from the Bank of England.

The Commons Treasury Select Committee added the risk of a double-dip recession comes more from the spending cuts and tax hikes initiated by the coalition government. But the committee admitted that on the long-term, the government austerity measures will strengthen the British economy. The measures target to cut Britain’s budget deficit and reassure the international markets of U.K.’s ability to repay its debts.

Article © AHN – All Rights Reserved

Posted in News, Personal Finance.

Obama Recommends Extending Unemployment Benefits

Tejinder Singh – AHN News Correspondent

Washington, D.C., United States (AHN) – President Barack Obama is set to continue unemployment benefits further, the White House told journalists at the regular briefing time on Monday.

Obama Recommends Extending Unemployment Benefits

White House Press Secretary Robert Gibbs on Monday confirmed to the press the suggestions that President Barack Obama will request another extension of unemployment benefits following the ones that the Senate is set to vote and pass on Tuesday.

"If the unemployment rate stays where I think we all expect it to … we may need to extend those benefits, yes," Gibbs said.

Gibbs argued that the unemployment benefits money gets channeled back into national economy and defended the president's approach, calling unemployment benefits "emergency spending" at a time when the unemployment rate is 9.5%.

There was no clear-cut answer to the question of when that rate would be considered as tolerable but Gibbs expected it to continue at the end of November, when the soon-to-be-passed round of unemployment benefits expire.

Gibbs noted, "I think it is fair and safe to assume that we are not going to wake up and find ourselves at the end of November at a rate of employment one would not consider to be an emergency."

The current jobless rate of 9.5% reflects the aftershocks of the worst recession since the Great Depression of the 1930s, Gibbs said.

"You see that the recession affects not just some lower skilled manufacturing jobs, as you might have seen in previous recessions, but you see the impact across the economic spectrum," he added.

Gibbs was addressing journalists at his regular press briefing just hours after Obama lambasted Republican Party for holding up the existing proposal to extend unemployment benefits. "It's time to do what's right," Obama said earlier on Monday, "not for the next election, but for the middle class."

Article © AHN – All Rights Reserved

Posted in News, Personal Finance.


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