Archive for the Financial Literacy Category

Creating a 5 Step Financial Makeover in 2012

It’s now 2012, and if you’re still procrastinating with making a financial leap, then you don’t want to put it off any longer.   Procrastination is never a good thing, and why have your personal finances suffer in the meantime.  If you need a financial makeover, it takes a mental commitment; one that will allow you to stay the course until the end of the year.  Here is a quick 5 step checklist that can assist you in staying committed to a financial makeover in 2012.  Read the rest here.

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How the Game of Monopoly can Teach your Children about Money!

Teaching children the different concepts of Personal Finance can be a difficult topic of discussion for some adults.   Many adults feel clueless on where to start to make the subject interesting and captivating.  Keeping a child’s attention on the subject can be daunting if the approach is too analytical.  If you want to succeed with introducing children to the topic of personal finance, make the subject fun and exciting by using board games.

Read the rest on Your Black World

 

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4 Tips for Protecting your Finances Online on Cyber Monday

Cyber Monday has been called the most profitable online shopping day for retailers since 2005.    Online retailers have been rallying to get Black Friday shoppers to continue their shopping frenzy until Monday, with hopes that this year will be even more profitable.  But consumers who are planning to shop on Cyber Monday, to score big on sales for the holidays.  Here are 4 tips to consider when shopping on Cyber Monday.

Read the rest on Your Black World

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Bank of America $3.48 Billion Dollar Bailout

 

Bank of America announced today on September 30, 2011, that they will charge a $5.00 dollar fee to all customers who use their debit card.  Will this mandate cause you to not use your debit card?  Depending on what age you are, you may or may not remember a time when we didn’t use our bank card for everyday use.  I remember those days, when I first got a job at 17yrs old, there was no direct deposit and of course no debit cards.  Everything was hands on, you got paid, and you cash your check at the bank.  I was always instructed by my mother to put something away for in savings, and the rest of the money you have to budget it appropriately to cover any personal expenses.  We’ll that time has changed, many people no longer, use the old fashion way of handling their personal finances.  Many of us spend money we don’t have because we assume that the bank will cover the purchase and we will pay the fees later, for example, when I get paid on Thursday or Friday.   Some people may give me some backlash on my feelings with this situation, but I do not think its wrong for BOA to initiate this new mandate.  I would hope that this mandate would stop individuals from using their debit card.  Did you know that it is estimated that BOA has over 58 million customers, at a $5.00 dollar fee a month which is $60 a year.  BOA will receive over $3.48 billion dollars.  You talking about a bail out their’s your bail out right there.

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What does “Financial Freedom” mean to you?

Before you read this post I want the reader to understand that this is just my general consensus and opinion it is not back by any polls or surveys.  The  21st century concept of time and money are being redefined. ”Financial Freedom”, is a term that has gained much importance in the changing financial scenario.

For some individuals ”Financial Freedom”  can mean the freedom from continuous financial responsibilities through a planned management and allocation of assets. It could free a person from back-breaking work by giving him a steady source of income for life.

One must not think that a financially free person is also debt free. However,  prudent asset management ensures that a person debts do not become a burden but only a part of his over-all expenses. In this way, his debts do not hinder his long term financial goals.

Financial freedom cannot be equated with being rich. One must not forget that surplus wealth requires constant supervision. In the long run, a rich man’s or woman’s obligations do not make him or her ”financially free” in the true sense.

Thus, financial freedom maybe defined as a lifestyle that blends expenses and income according to the individual preference. This makes ”financial freedom” a more possible and convenient state of being.

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Do you know the difference in Original Creditors, Collections Agency(ies) and Junk Debt Buyers? Book Excerpt

I recently decided to write a book and here is an excerpt from my upcoming book, take a look let me know what you think.  This is just a rough draft.

The credit repair process can be a daunting task and before you anxiously decide to go pay an outstanding debt, that you have either notice on your credit report, or you may have received a letter in the mail.  It is important that you understand who are the key players and their role in the credit repair process.  It is important to know the difference between Original Creditors, Collection Agency(ies) and Junk Debt Buyer.

Definition of Original Creditor and the Collection Agency(ies):

Original Creditors are the credit card companies that issued you (the debtor) the credit card to make purchases.  For example those cards maybe American Express, Discover, VISA, Mastercard or department store cards (eg. Macys, Lord & Taylor, Sears etc.)

Collection Agency(ies) are companies that buy unpaid debts from Original Creditors.  These unpaid debts are charged off by the Original Creditor because the consumer has not paid on the debts for as long as 90-120 days.  This also includes attorney offices that collect on debts as well.

Junk Debt Buyer is another name for a collection agency these companies specialize in purchasing old collection accounts from credit card companies that are older than 120days old.  These debts may be auto loans, telecommunication accounts, or retail accounts.

These Junk Debt Buyers buy these accounts in bulk for pennies on the dollar, which is why they can offer the consumer discounts off their outstanding bill.  For example, if you have a charge off balance of $3,500 that was once owned by American Express the JDB will purchased that debt for .20 cents on the dollar which means the JDB paid only $700 dollars.  Now you see why collection companies can offer you a discount off of what you owed.

Here is a list of widely know JDB that may have called and harassed you:

  • Allied National/Interstate Risk Management Aternatives(RMA)
  • Asset Acceptance (AAC)
  • Asta Funding
  • CAMCO (Capital Acquisitions & Mgmt Co)
  • Cavalry Portfolio Services
  • Collins Financial Services
  • Encore Capital Group
  • Excalibur
  • First Select Corporation
  • JBC & Associates Arrow Fin. Svcs. RJM Acquisitions
  • NCO Group
  • Oliphant Financial Corp.
  • OSI Portfolio Services
  • Phoenix Asset Acceptance
  • Portfolio Recovery Assoc.
  • Pressler & Pressler
  • Sherman Acquisitions/Sherman Financial Group/Alegis
  • Unifund Group

Again it’s just a rough draft but there’s more to come.  Stay tune.

 

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How to Spend Wisely to Save Money

Have you ever noticed that the things you buy every week at the grocery stores go up a few cents between shopping trips? Not by much…just by a little each week but they continue to creep up and up.

There is a way that we can keep these price increases from impacting our personal finances so much and that is by buying in quantity and finding the best possible prices for the things we use and will continue to use everyday… things that will keep just as well on the shelves in our homes as it does on the shelves at the grocery store.

For instance, if you are a pet owner dog food and cat food costs about 10% less when bought by the case than it does when bought at the single can price and if you wait for close out prices you save a lot more than that.

Set aside some space in your home and make a list of things that you use regularly which will not spoil. Any grain or grain products will need to be stored in airtight containers that rats can’t get into so keep that in mind.

Then set out to find the best prices you can get on quantity purchases of such things as bathroom items and dry and canned food.

Don’t forget to shop at stores such as CVS, Walgreens, Rite-Aid or any other regional drug stores in your area.  These stores offer great discounts, coupons and rewards, you often cut your shopping bill in half by shopping at these stores as opposed to the supermarket chains.

You will be surprised at how much you can save by buying a twenty pound bag of rice as opposed to a one pound bag.

You can buy some clothing items such as men’s socks and underwear because those styles don’t change, avoid buying children’s and women’s clothing, those styles change and sizes change too drastically.

Try to acquire and keep a two year supply of these items and you can save hundreds of dollars.

How this article can help with your personal finance journey.

 

 

 

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Are you living a Mint life with your personal finances?

We’ll if you’re a user of Quicken or QuickBooks when it comes to your finances than you will love Mint.com.  Why, because Intuit the creators of Quickbooks and Quicken own Mint.com (they acquired the company in 2009). Not that it means anything, but I thought I’ll share that tidbit, just to give you some history on the company.

At first I was hesitating with using Mint.com, I enjoyed Quicken and I was very comfortable with the program. But now that I am doing more work on my I-phone I wanted to be able to manage my finances with a personal finance app that eliminates the headache of syncing information between my computer and my I-phone via online. So, that’s just one reason why I took the leap. I was also impressed with how my banking information was instantly updated between my computer and my I-phone. This feature eliminates the back and forth changes between the two interfaces.

The second reason why I switch I was happy with how the historical information populated as far back as 90 days, all I have to do is go back and make some category changes. Now the only caveat that you may have with the program is that everything is done online meaning that there is no downloading software on to your computer’s hard drive. So word of caution if you are leery about working online because of online cyber theft then this program may not be for you, you may want to consider the manual version of Quicken. But if your an online banking user like myself than website is fully encrypted with VeriSign and TRUSTe, and don’t forget if your managing your personal finances on a daily basis than you should notice any hokey pokey that could occur with your online account.

So I will end this blog post with I am very comfortable with the program and I highly recommend it for your personal finance use.

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The Credit Amnesty Program: Don’t believe the Hype!!!!

With just a few days left until the end of the month, as well as April being Financial Literacy month.   I thought it was very ironic to hear a recent radio advertisement announcing that certain individuals should take part in a great program being given by creditors; it’s called “The Credit Amnesty Program”.  This advertisement was encouraging people who have credit scores as low as 480, to come and apply for INSTANT CREDIT no one is turned down.  Lie!!!!!, this is the biggest gimmick and it’s been around for years it just has a new name, but the financial shackles are the same for individual with bad credit.  Why because the people who buy into these tactics are given interest rates as high as 18% or higher, the debt these individuals accumulate is designed for them not to pay if off which in turn many of these people will default on their debt.  I recently did a webinar regarding “What impacts Your Credit” during this webinar I showed the cost comparison of a credit worthy consumer and an unworthy credit consumer.  Take a look:

Examples of Credit Profiles

Here is an example of the cost of a $20,000 car loan over 5 years:

Prime 680 or higher score – Interest rate 7%, Payment $405, Total Cost after 5 years $24,300

Sub prime 500 – 619 Interest rate 14%, Payment $477, Total Cost after 5 years $28,620

Jilted 500 or below – Interest rate 21%, Payment $557, Total Cost after 5 years $33,420

As you can see in this example there no advantages of being an unworthy credit consumer, you may be able to buy material purchases but the consumer with bad credit pays a big price at the end.  Don’t buy into the hype, educate yourself.

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Why are you so Broked?

 

 

 

Recently on LinkedIn I came across a post regarding the difference between Wealthy and Broke people.  The title of the article is named “Being Broke Is a Waste of Life”  it was written by Luther Thompson a professional I connected with on LinkedIn.   This article clearly defines the difference in characteristics between a Wealthy person and a Broke person.  Please read the article below, and tell me what you think:

BEING BROKE IS A WASTE OF LIFE!

Why are you still tired, broke and enslaved?

The following is a list of the Top 20 principles of the wealthy. It is not meant to be specific financial advice, however it is a bright-red warning flag to help you avoid financial trouble.

1. The Broke think everything is too good to be true, while the wealthy think that getting a job sounds too bad to be true.

2. Broke people give up when things don’t go their way; a few disappointments and they are onto something else, saying things like “it wasn’t for me.” The wealthy work harder and become more determined when things go bad, and understand that you have to take the bad with the good to make it.

3. Broke people always have an excuse. Wealthy people say “my fault” and refuse to make excuses.

4. Broke people think that not getting what they want is OK. Wealthy people are disgusted at the thought of not getting what they want and will do whatever it takes.

5. Broke people always have to talk it over with their broke friends to make sure no one will make fun of them if they make a decision. Wealthy people think for themselves and could care less what their broke friends think.

6. Broke people are never coachable and teachable. Wealthy people are always learning, even when the money starts coming in, they never stop learning from those who were there first.

7. Broke people are scared of others. Wealthy people entrust in others and know that other people are crucial for their success.

8. Broke people are always procrastinating; they would rather talk about it, read about it, think about it, but never seem to do anything. Wealthy people hate doing anything but getting it done.

9. Broke people are glad when the day is over. Wealthy people love when the day begins.

10. Broke people think Wealthy people are lucky. Wealthy people put themselves into a position to be “lucky,” and then work hard to make the “luck” show up.

11. Broke people work by the hour. Wealthy people work by the month.

12. Broke people want to know that after 1 hour of work they have something to show for it. Wealthy people find broke people who think like that and make them their employees.

13. Broke people get excited they just got hired. Wealthy people think it is funny that someone could be fooled that easily; they are just making the wealthy person wealthier.

14. Broke people complain a lot. Wealthy people are thankful that no one shot at them today, they didn’t have to fight in a war, and that they don’t have a job.

15. Broke people are too concerned about what other people are doing. Wealthy people are only concerned about what they can be doing to get more done.

16. Broke people think that if no one is doing something, it must suck. Wealthy people think that if no one is doing something, it means more money for them.

17. Broke people think that if everyone (all 200 people at the meeting in a city of 1 million) is doing something, it must be saturated. Wealthy people think that broke people aren’t too bright.

18. Broke people think it is OK for other people to live where they want to live, drive what they want to drive, and do what they want to do.

19. Broke people are OK with the fact that they can’t do these things. Wealthy people get sick just thinking about being average.

20. Broke people think that other people’s opinions are worth more than their dreams. Wealthy people know that their dreams are worth more than other people’s opinions.

I have learned to be wealthy. You must learn from the broke and do not do what they do nor think how they think.

To your success,

Luther Thompson, Jr.
Luther Thompson, Jr. & Associates
PO Box 1026
Atlanta, Georgia 30156-1026
Voice mail: 866.485.7373
Email: lutherthompsonjr@bellsouth.net
Blog: http://lutherthompsonjr.wordpress.com/2010/05/11/profits-are-better-than-wages/

 

 

 

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