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Personal Finance – How to Properly Build Emergency Reserves

Personal Finance – How to Properly Build Emergency Reserves

You must prepare for the worst to come. It could be a surgery or car accident. These things account for a lot of money. We all never know what the future might be. Therefore, we all have to prepare for the unexpected. Truth to be told, all smart people do it.

People have been saying that one must prepare ahead and leave 6 months of cash reserve in hand. This 6 months amount of money could be used to sustain life expenses and such. The question is how much to put in? Will it be too much for 6 months? In fact, some people question the 6-month period to be too long.

The three-month savings reserve

You should go for this short one if you have a 401(k) account for example, or if you have friends and family who you can borrow money from. This method is suitable when you need to keep things simple and want to optimize your other investments. It is also suitable when you have a steady stream of salary from your work.

The six-month saving reserve

This is a slightly larger amount. It is most suitable when you know you cannot rely on other people or places instantly. Therefore, you have the extra amount of cash to rely on in case something goes wrong with your income.

The one-year saving reserve

Predict your income. This is especially true if you want to venture into business and quit your job in doing so. However, most of the time, it is not smooth sailing. Starting a business can have negative cash flow during the first few years. When you know your income is not stable at all, be sure to have the amount of money that can last you a year.

Credit cards can be relied upon

In times of emergencies, you can definitely rely on them. Why is this so? This is because you have the luxury of spending on credit and paying your debt later. But this can backfire if you spend too much. So, the proper advice is to still prepare a three-month cash reserve for living expenses as described earlier.

The golden rule is always count your expenses. Write them down if you can. Whenever writing is involved, there is success. In fact, you will see a common pattern between most successful people. They write their goals and their actions down all the time.…

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Forbrukslån: Why People Need to Worry About Housing Loan Scams?

Housing loan fraud has become more popular over time and is an important concern during economic recessions. Upheaval in the housing market, property owners facing foreclosures, as well as unscrupulous individuals looking for easy money all contribute to climates in which housing debenture frauds may happen.

The Federal Bureau of Investigation defines housing loan frauds as material misstatements, misrepresentations, or omissions relied on underwriters or lending firms to insure purchase or fund debentures. By this definition, both applicants and lending institutions can clearly remove such frauds, even though the former may not think their omissions or misrepresentations are important enough to be a significant concern. Housing loan fraud is a general term that can refer to many fraudulent activities:

  • Inflating appraisals to obtain mortgages for more than what properties are worth
  • Claiming assets or income borrowers do not have
  • Posing as borrowers on behalf of other people who are actually making the purchases
  • Pretending to provide help to economically stressed property owners to skim off equities from homes

Housing debenture and forbrukslån (consumer loan) frauds can be initiated by borrowers themselves or fraudulent lending firms, real estate agents, brokers, or individuals looking for favors. People looking to buy a property or homeowners looking to refinance can be accidentally caught up in these frauds by acting on bad advice from fraudulent lending firms or real estate agents they trust.

Understanding housing loan frauds and a list of common scams

Magicians earn huge applause from individuals by pulling animals out of their hats or performing card tricks. But people who try to pull a trick with housing debentures earn prison time. Listed below are some examples of home loan scams that happen every day.

Housing debentures are considered the largest investment most individuals will make. With all the money comes tons of temptation for criminal elements. There are a lot of scams on the market today. Some of these common types are perpetrated by agents or firms and by property owners:

Not-Accurate income

Because of the way self-employed individuals file their taxes, most of them fail to report their full income on their tax reports. Stated income loans allow borrowers to claim a particular amount, and underwriters base their lending decisions on what was stated by borrowers. If individuals inflate their income, it constitutes home loan frauds.

To know more about income statements, check out https://online.hbs.edu/blog/post/income-statement-analysis for details.

Under-the-table-exchanges

Conventional banks are reluctant to release funds to individuals who cannot prove that they have the money or financial means to make monthly amortizations. But a hefty down payment can sway a lot of lending firms’ opinions. If sellers need to dump properties, they can provide borrowers with enough funds for down payments under the table. With the funds in hand, buyers can illegally qualify for a home loan.

Owners-occupants refusing to occupy

Since lending firms tend to charge higher rates to non-owner occupants, a common scam tactic is to claim occupancy despite the fact that they do not live in that place. If buyers plan to purchase properties and claim occupancy, they need to pack their bags and move in. Otherwise, they will be committing a home debenture scam.

Getting down payments and repaying it

People are allowed to gift part of the down payment for the property on the condition that these gifts are not repaid. It is much like the under-the-table exchanges between sellers and possible buyers but in reverse. These gifts are given officially but then paid under the table.

Scams from professionals

On occasion, people may fall victim to scams perpetrated by home debenture professionals. These tend to be more complex and are hard to detect. It is a lot easier for individuals to choose trustworthy brokers or agents upfront compared to catching mortgage con artists red-handed.

When choosing these brokers, loan officers, or agents, people need to make sure that they are backed by long-standing financial institutions and can provide good referrals. People need to keep their eyes open for deals that are too good to be true because usually, they are. Individuals may also decide to pay for the services of lawyers to check and review all their debenture documents before closing.

Lawyers can provide definitive answers and will work on their behalf tirelessly. Scams in this industry are a very tricky topic, especially since loans tend to be pretty confusing. As the property market gets tighter and purchasers or sellers become more and more desperate, people can expect scams to rise. Armed with the necessary info, people will have the knowledge to avoid them completely.…

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Three Steps to Cheaper Financing

Three Steps to Cheaper Financing

Sooner or later, most businesses need to turn to external sources to finance growth; whether it’s to invest in new equipment or machinery, to purchase property, upgrade technology, or even to maintain cashflow whilst a new product line kicks in. The cost of external financing can be considerable, and keeping it down is a key element in maximising your profitability. So; have a look at 3 ways we have chosen to find cheaper financing.

1. Plan Ahead

Plan your financing requirements well in advance – if possible, as much as a year before you will need the funds. This gives you enough time to prepare a robust application, shop around for the best provider, and negotiate the most favourable terms. If you left your planning to the last minute, not only will you limit your negotiating power, you might also give the impression that your expansion plans are not very well thought-out. Obviously, business owners need to be agile and respond to opportunities quickly, but this doesn’t change the face that quick money is invariably expensive money.

2. Make the lender bid for your business

Once you have a well-prepared financing plan, approach a number of lenders, and ask for them to submit a proposal. These days, banks are used to having to bid for your business. But don’t just focus solely on the cost – consider factors such as the quality of the working relationship, how much experience they have in your industry, etc. Use your track record to try and minimise charges; don’t forget, the main concern for lenders if the degree of risk involved. If you have a good track record, you may be able to negotiate cheaper charges.

3. Ask for more than you need

Many business owners are too modest in their funding applications, fearing that if they ask for too much, it will decrease their chances of success. But it is much worse to underestimate your requirements. Returning a few months later to ask for more on top of your loan will not only start to ring alarm bells about the reliability of your business plan; it is also a lot more expensive to process two applications rather than one.…

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Common Issues With Self Storage Units

Common Issues With Self Storage Units

In any kind of business, there’s bound to be some issues along the way. It’s never a smooth sailing and problem-free process for business owners. But when they’re fully prepared right from the start, owners and their staff will be able to handle whatever issues they encounter with confidence.

Preparation is and should be a priority for all types of businesses. This is to build trust with their customers and to let them know the products or services they’re offering have been well planned to meet their needs.

Self storage facilities are no exception. As they provide a valuable solution to many people, whether individuals or organizations, they see to it that customers are given priority. This is the appropriate attitude because after all, the customers are the life of any business.

But as always, self storage units are not all perfect. Sometimes, customers may not be totally satisfied with the service and unit they get resulting in complaints to the management.

The non-functioning gate code is one of the most common problems among self storage facilities. Factors that can cause this issue are a customer wrongly entering his or her code or forgetting the code, late payment of the rental fee and misplacing their card. Experts in the industry, however, point out that to prevent this problem, managers and front desk staff should also do their part in educating customers about the proper way of using their access number and the reasons why it may not function at times.

The level of coldness in a climate controlled rental unit is another common complaint. For some customers, the concept of climate control in self storage facilities refers to a room with proper air conditioning and heating system. When they don’t find this, they immediately become upset. Unfortunately, this type of unit actually refers to a room where temperate is maintained at a steady level to prevent humidity.

Access to unit may also cause problems every now and then. This issue is common among customers who failed to understand the proper hours during which they can access their self storage unit. Not all facilities are open 24 hours every day as many provide access to their customers’ units only during business hours and certain times beyond the regular hours. This can also be a problem if the person accessing the room is not the actual tenant and was not allowed by the facility’s staff.

The size of the unit is sometimes a source of complaint as well. This is unavoidable especially among customers who find out that the unit size advertised on a certain facility’s site does not correspond to the measurements of the actual self storage unit. It’s a reality that there are meticulous people who want to have the exact measurements and would even measure the room right in the facility if necessary. So when they find out the size is not exactly what they need, they complain right away.

Self storage facilities then should take it upon themselves to always remind customers about their policies and encourage them to read and understand their rules to avoid complaints moving forward.…

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Ten Financial Tips You Want Your Kids to Know

Ten Financial Tips You Want Your Kids to Know

Most people learn about finance the hard way through mistakes made from practical experience.  People usually aren’t taught about personal finance in school.  Moreover, parents don’t teach their children the basics either because they don’t understand it themselves, or they don’t take the time to it. So, most of us learn about money as we go through life.  We make purchases, go into debt, and end up with a meager retirement account.  CNN Money reports that 43% of workers surveyed in 2010 said that they have less than $10,000 saved for retirement.  Even with full Social Security benefits, these people will be hard pressed to maintain their pre-retirement lifestyle.  What if they had made better financial decisions earlier in their life?  Perhaps if they were told about some basic financial principles they would be in a better position?  Here are ten basic financial principles that your kids should know to avoid making simple mistakes:

Don’t spend beyond your means.  This is such a basic principle that it would not seem to be worth mentioning; however, it is the key principle to financial success.  Most financial advisors will tell you to pay yourself first by saving 6-10% of your income.  You can only do that if you spend less than you make. So the first and perhaps most important rule of financial success is not to spend beyond your means.  

Save for a rainy day.  As soon as you start working, open a savings account as an emergency fund, a rainy day fund.  A rule of thumb is to have a reserve equivalent to six month’s salary in case you are out of work.  If you have an emergency like a major car repair or medical bill, you will need to replenish the fund if you pay your bills using your emergency savings account.

Pay off credit cards monthly.  It is good to have one or two credit cards so that you can establish a credit history; however, make sure to pay off the balance on or before the due date.  Credit card companies charge excessively high interest rates and fees.  If you pay your balance in full, you get to use their money without interest; however, if you are late or make a partial payment you will pay finance charges that are easily avoided.  Also, don’t take a cash advance unless it is for an emergency.  Again, they will charge you cash advance fees and if you don’t pay it off within their promotional period, they will also charge higher finance charges which makes this very expensive.

Open an IRA when you are young and make the maximum annual contribution. The time value of money works wonders when you invest over a long time horizon, bur you must start when you are young.  People who start investing in their early twenties will far outpace those who begin in their thirties or forties.  Those who start late will never catch up because they don’t benefit from the compounding effect on their investment which is also leveraged inside of a tax-deferred account like an IRA. 

Fully participate in your company 401k.  If you work for a company that offers a 401k plan, make sure to participate fully, or a least to the level of the company match.  If the company has a matching grant, that is like free money.  It will quickly add to your nest egg, but you must invest or they won’t match it.  Also, just like an IRA, a 401k account is tax advantaged, so the compounding effect will be multiplied as a tax-deferred investment – meaning that you won’t pay any taxes until you withdraw the money in retirement.  Also, only borrow against your 401k plan or withdraw funds if it is an extreme emergency.  You must protect your 401k plan as a retirement plan.  If you leave your employer then roll it over into a self-directed retirement plan, but do not take the money out early to avoid penalties.  Keep your 401k for your retirement.

Buy some universal life insurance in your 20’s.  Universal life insurance is a combination policy that offers both a term life insurance plan and the benefit of a tax deferred savings account inside of the policy.  Everyone will need some life insurance, especially if they are married and have children.  Buying life insurance when you  are young, can reduce the cost of the premium investment and allow the cash value to build up in the account.  If you die unexpectedly, the proceeds will protect your family or pay for your children’s education.  If you live into retirement, you can convert the policy to an annuity to supplement your income.

Buy a house when you can afford one.  Real estate is one of …

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Boat Storage Made Simpler

Boat Storage Made Simpler

People who are lucky enough to own boats often are not as lucky when it comes to finding the right kind of Boat Storage. While the self storage industry has grown by leaps and bounds over the past few years, not everybody has been able to keep pace with the technology required to safely keep large and heavy objects, especially those with motor parts. This is possibly why storage companies that offer RV storage, Car storage, Furniture storage and Boat storage are few and far between. This article takes a closer look at what makes an ordinary warehouse or garage storage unit into the perfect boat storage facility. Be sure to check for these things when you go looking for storing space for your vehicle.

Size

* The first and foremost thing that a facility to store boats needs is a good size. Boats are delicate structures and cannot be stacked or made to lean on one another. There has to be sufficient room not just to park the vehicle, but also for workmen to move around and take care of any repair jobs that it may need.

* Even after you ascertain the space, be sure that your boat gets the space it needs.

Location

* As regards the area needed to house a boat, the location could be outside or inside. While outside storage units are susceptible to weather conditions, they are also a whole lot cheaper. Provided the weather is temperate, it is an option as good as any.

* Boat storage facilities that are inside a garage often have the disadvantage of being located underground, but at least they stay away from the onslaught of rain and wind which can cause a lot of damage over a long period of time.

Maintenance

* On account of their being expensive high value items, it is worthwhile to invest in some care for your vehicle while it languishes in boat storage.

* Experienced staff that know what they are doing are always a big advantage. Try to get some pain jobs and minor repairs included in the storage cost itself.

* Boats are made of very different materials – you may want to consult the seller to see any specific care that your vehicle may require. The company that you entrust your boat with should also have a few consultants that you should make it a point to talk to about risks and the best way to mitigate them.

Safety

* It is also important to consider the safety of the self storage units. While boats may seem like a difficult item to steal, people have been known to take away parts and then the boat bit by bit.

* Find out the security systems in use as well as the past history of the place as regards its crime record.

Be sure to invest in insurance. It may add to the cost of your boat storage, but is a small price to pay for the peace of mind that it will give you. You should also try and choose a facility that is not too far as otherwise the cost of transport could end up being very high. Transit damages are common, so make sure you have the boat checked before it boards the transport vehicle.…

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The Do’s And Don’ts Of Using Self Storage

The Do’s And Don’ts Of Using Self Storage

Whether you’re a homeowner, student or business owner in need of a place to keep your items, you need to make sure that you utilize self storage units effectively. These facilities are affordable and come in various sizes but you have to choose the right one for your needs.

Here are some tips then that can follow to ensure that you pack your personal belongings properly and transport them safely to the self storage facility of your choice. These are the basic steps that will help make the process of moving stuff from your home or office to the rental unit a lot easier.

List your items. The first step towards organizing your things is to list the items you want to keep in the rental unit. You can classify them according to clothing, decors, books, electronic devices and so on.

Check the facility. It is a good idea to visit the facility to help you determine the size of storage unit you’ll need. If you’re not sure about the size to rent, show your list to the manager and ask for assistance.

At this point, you may also want to get information about their lease terms and conditions. This will give you an idea of what they require, the rental fee, deposit if any and what they don’t accept.

Schedule your mover. If you’ll be utilizing a moving company to transport your boxes, set an appointment early such as a month before your scheduled move.

Plan how to utilize space. Once you have packed your possessions in their proper boxes and labeled each of them, you can make a floor plan as to how you are going to arrange them in the rental unit. This is a good organization technique so that you don’t waste time moving them when you’re already at the facility.

Keep boxes off the floor. Use pallets and plywood on the floor before putting your boxes. You need to avoid any moisture buildup that can come from the concrete flooring. You may also want to use freestanding shelves if you want to avoid putting boxes one over the other.

Place boxes with frequently used items in front. If you’ll be accessing your items there every now and then, make sure that the boxes containing items you’ll be using are in front.

Disassemble items. Furniture and electronic appliances should be disassembled for easy storage. Wrap each of them and label properly. You can do some color coding for the wires and their matching appliances for easy identification.

Avoid using plastic. If possible, do not use plastic to cover your items. This will only cause moisture buildup overtime. Use moving pads, sheets or light blankets instead.

Don’t use printed newspaper. Printed newspapers are a no-no because they can cause stains on your items including clothes and linen.

Don’t put heavy items in one box. Try to distribute the bulky belongings in several boxes to make it easy for you or the moving company’s staff to carry them. This is true in the case of books.

Never store food and flammable items. Remember not to include paint, oil, gasoline and food in your personal belongings as they’re dangerous.…