How can I become a millionaire ?

Many people feel that becoming a millionaire is next to impossible. However, if you’re planning to spend your retirement without financial burden, you can start becoming a millionaire today. Although becoming a millionaire does not happen overnight, it is a possibility as long you make tiny steps to reach a huge goal.

An important step to become a millionaire is to find ways to save money. People who plan ahead usually achieve their financial goals because they practice wise spending. Analyze your daily spending habits and determine which small expenses you can do without. For instance, do you spend a 5-dollar coffee at Starbucks when you can make your own coffee at home? Do you eat in fine dining restaurants when you could create that same meal in the comfort of your home? If you actually spend time thinking of these little expenses and avoid them as much as possible, you’ll see an extra $10 to $75 per day.

Once you have some extra cash monthly, you should start investing to make your one-million goal possible. Whether you choose to invest the money in mutual funds, stocks or other investment opportunities, make sure you are knowledgeable enough not to lose your savings.

The problem with saving money is people don’t make it a habit. If you usually forget making a 5-dollar daily, you can have your bank do this for you. Most banks allow you to apply for several accounts, assign one that you won’t use. You can also link an IRA to your bank account so the bank could make the transfers automatic each month, so you’ll be sure not to miss your 30-day savings.

While $5 a day may seem little today, be aware that after 40 years of $150 monthly deposits with 10% interest, it could pile up to $1,000,000 and you can easily retire. Remember that the more you can put into your savings and investments, the earlier you can retire as a millionaire.

What is a private annuity trust ?

A private annuity trust (PAT) is a type of capital gains deferral program that aims to help with depreciation recapture costs and high-capital gains. This plan usually benefits owners of residential or commercial real estate who require no immediate funds from property sales. Since highly-appreciated properties involved high taxes, a private annuity trust can help people save money.

When an owner has a private annuity trust, he or she sells the property to a trust, which involves transferring the ownership before the sale of property. In this case, the payment of trustees is in the form of a contract, which is set up for a predetermined number of payments for a pre-calculated amount that should be complete for the rest of the owner’s life.

All annuity payments are calculated using a formula with quantities based on the age of the owner, amount of the sale proceeds and the interest rate based, which the IRS sets. The proceeds from each property sale included in the contract are held in a private annuity trust, which can be invested by the trustees. All payments are made to the owner for the agreed amount.

Instead of being taxed on the lump sum of the sale, the owner is taxed only when annuity payments are received. People usually choose a private annuity trust to aid them for retirement because annuity payments don’t have to start immediately. In addition, owners can take advantage of tax benefits as long as the annuity payments start by age 70.

What is a debt consolidation loan ?

Ah…the word Debt Consolidation Loans has struck much debate on whether it is such a great one solution wonder or just another loan facility which will create an escalating debt disaster. There are supporters of debt consolidation loans and there are the naysayers. Those who have benefited from debt consolidation loans have much good things to say about it relieving their financial burdens whilst those who went on a downward spiral swore against it.

Just exactly how good or bad a Debt Consolidation Loan is depends on how you use it. The most important factor in making or breaking such a loan is your financial discipline – knowing what you want out of it and sticking with your financial plan. To make the most out of a Debt Consolidation Loan and ensuring that it really helps to consolidate your loans and relieving you of your surmounting debts, there are really a few things you ought to know and apply.

1. Before taking up a Debt Consolidation Loan, consult a professional debt counsellor to assess your options. A certified financial planner may be able to assist you as well and may not be biased towards debt consolidation loans as compared to seeking out advice from the debt consolidation loan companies.

2. Calculate your current outstanding debts and the interests payable and estimate how long you will take to clear your outstanding debts if everything remains status quo. Then, calculate what options the Debt Consolidation Loans can offer you and whether you will be able to save more using the latter compared to staying status quo.

3. Have you considered a debt consolidation mortgage instead which is likely to give you a lower APR or Annual Percentage Rate? It may be a cheaper option compared to a debt consolidation loan.

4. How about debt settlement with your creditor where you offer them a lump sum in exchange for a discount on the total outstanding debt payable? It may be a faster and more worthwhile option to settle your debts immediately with a discount.

5. Don’t go into Debt Consolidation Loans without familiarising yourself with the fees, charges, interest rates and terms and conditions which come with it. You would not want to put yourself in a position which is worse that before. Your goal is to reduce your financial problems, not prolonging or making it worse. Just because it works for others does not mean that it will work for you as each individual’s financial circumstances vary.

6. Once you have successfully applied for a Debt Consolidation Loan, you should consider discontinuing the use of your credit cards, store cards or even overdraft facilities until you have fully repaid your Debt Consolidation Loan. Use cash instead for your purchases so that you will be able to monitor your day to day expenses whilst keeping tabs on your monthly instalments with the Debt Consolidation Loan.

7. Change your spending habit. Something must have gone wrong in the first place which resulted in you having accrued numerous outstanding debts which necessitate the restructuring of your outstanding debts with a Debt Consolidation Loan. Analyse your spending habit and identify which areas you may have overspent or spent without consciously knowing its impact on your financial line eg. smoking, gambling and drinking. The Debt Consolidation Loan is the start of a new life towards being debt free and you should remain disciplined to see through the full payment of your Debt Consolidation Loan. Changes to your lifestyle may be required and if it helps you to achieve financial freedom, it is definitely a worthwhile change to consider.

How can I get cash in an emergency ?

We all like to be prepared for any emergency but sometimes, things do not always turn out as they plan. When an urgent bill comes about – and usually the medical type of bill where admission into ward is required, you may suddenly be caught with a cash call. How should you be prepared for such emergencies?

The first avenue would be to apply for yourself a credit card solely for emergency purposes. Do not use this card but carry it with you so that in the event you need to place a substantial deposit or if cash advance is needed, your available credit limit will take care of this burden. If you start using this credit card for your usual expenses, you may find yourself low on credit and being unable to afford the emergency cash call and hence, it is recommended that you set aside one credit card just for emergency.

Where possible, make sure that this credit card grants you the highest credit limit amongst your other credit cards. Firstly, the highest credit limit helps with the emergency whilst the lower credit limits on the other credit cards you are holding theoretically helps you to manage your finances better so that you do not overspend.

With credit cards, you can utilise the cash advance facility by withdrawing cash from any automated teller machine which is linked to the credit card account – usually Visa, Cirrus or Maestro. The amount available to you would be your available credit limit and in a way, this works out as if your credit limit is your cash balance at bank which you are now withdrawing from.

The other avenue for quick cash in an emergency may not be deemed as immediate cash but is probably the fastest after credit cards. This is where personal cash loans come into place. If you are an employed person with a stable income, you might want to consider getting an urgent personal cash loan which is usually disbursed into your banking account within a day. The usual documentation required includes proof of employment, salary slips and personal identification. Guarantors and security are not usually required. For many banks, the maximum cash loan which will be granted to you would be about 3 times the amount of your monthly salary.

Payday loans are also another avenue for quick cash in an emergency and this is usually secured by a post-dated cheque which includes the amount borrowed and the interest charges applicable. Just like the personal cash loans, approval and disbursement of the loan amount is usually done within 24 hours. You can apply for a payday loan online and will require an active banking account for the monies to be remitted to you.

However, intended borrowers must be cautioned that all three quick cash avenues discussed above come with probably the highest interest rates around amongst other loan options and that is understandable. The above facilities are all unsecured credit and / or loans and the financial institutions granting the above facilities to you would need to factor in the risk of such lending by imposing a higher interest rate chargeable so that the amount earned through the interest rate would help it to cover the non-performing loans. Bearing in mind the high interest rates chargeable and at times, additional processing or administrative fees involved, it would be prudent to analyse whether you really need to utilise these facilities. If it is an emergency, you truly may have no choice but it is of comfort knowing that you can turn to such facilities for quick cash during such times.

What should I do if I cant afford the bills ?

Have you found yourself in a position when you lack the cash to pay your outstanding bills? Perhaps with rising fuel costs, inflation and with the sub-prime crises, you get a splitting headache wondering how you could settle the bills which are now lying on your table before you. You are not alone. And you are not necessarily a bad person if you are unable to pay your bills.

Do you ever talk about your financial predicament? Most people don’t and that is understandable. Where finance is concerned, it breaks into the ego of that person. Having financial problems including the inability to settle one’s outstanding bills is deemed as being a failure, not unlike a taboo as far as society is concerned. Nobody likes to talk about how much they are behind in their payments. People rather talk about their recent material acquisitions rather than their financial problems. But you must get out of this. If you are in serious financial problems, you must seek help just like how you will need to seek help if you are having serious emotional problems. What may start out as a small financial hiccup can balloon to something out of control if not tackled head on.

So, what then? Get help! Don’t just wallow in self-pity or take it out on the innocent as they definitely will not improve your financial situation. What you need is proactive action, not passive inaction. Worrying further about how the bills are going to pile up further in the coming months will not help either.

Seek the counsel of a consumer credit counsellor who may be able to give you professional advice on how you should restructure your financial problems and find effective and practical solutions to your financial problems. Muster the courage to contact your creditors and tell them about your financial hiccups and find out how they can accommodate you – eg. to restructure the length of payment, amount of payment or even to consider a lump sum payment ala debt settlement schemes.

Consider a strategy wherein you set aside at least 20% of your income toyou’re your creditors with priority to the creditor whom you are owing the most or your biggest credit card bill. Then, stash away 10% from your income into safe investment vehicles and use the remaining 70% of your income for your monthly cost of living. Get a second or part time job if that will help you to repay your bills faster. Even with the 70% of your income which you use for cost of living, if there be any surplus, use it to pay your debts. If you must, sacrifice on entertainment and luxuries. Wait till you can afford them once you are debt-free. Consider terminating your subscriptions to gymnasiums, yoga classes, magazines or even cable TV as you don’t need these extra bills to pay for. You can always take a jog around the park or read books and magazines in the local libraries. Sell off your club memberships or run a junkyard sale to raise some funds whilst helping yourself to do some housekeeping.

With the above strategy, negotiate this with your creditors so that they can understand your financial position better. Being upfront and honest with them pays. They might decline but they will have to consider the costs of filing a claim against you for non-payment. Your strategy above will also become useful to show the Court in the event you are dragged to Court for non-payment as it shows that you have done all you could to get yourself out of this financial rut.

How can I work out of debt ?

If you are struggling with outstanding debts and are looking for solutions to them, there are many ways to help you get out of them. The earlier you deal with your debts, the better it is for you as the longer debts are stretched, the more you will have to pay in terms of interests and costs.

One of the ways to work out of debt is what is known as Debt Settlement or Debt Negotiation. This method is fast becoming a favoured choice amongst Americans due to its interesting strategy which are focussed on those who are finding it hard to keep up with their debt repayments.

People always try to avoid bankruptcy as this is deemed as the lowest point one can get financially. The trauma and shame associated with bankruptcy can remain a stigma for the bankrupt for many years to come and therefore, it should be avoided at all costs. This is where Debt Settlement Companies may be valuable in rendering the assistance required to help solve the mounting outstanding debts.

With the Debt Settlement procedure, the Debt Settlement company, if you choose to retain them, or you as the debtor, would make an offer to the creditor to settle the debts in one lump sum or within a short instalment period with the hope of slashing down the total sum payable. If you are lucky, you may be able to get up to 50% discount on your outstanding debt.

Why would the creditor take such a hefty cut in their expected income (your debt)? Well, the creditor may find that it is more worthwhile getting an instant lump sum payment albeit with a discount rather than risk getting nothing or pittance should your financial situation deteriorate out of control. A bird in hand is better than two in the bush and being paid earlier would enable them to use the money for further investments.

It would therefore require a certain amount of negotiation skills to be able to put up a convincing argument to the creditor why they should grant you a hefty discount on your outstanding debts. Perhaps it would be worth telling them that in the even you fall into bankruptcy, they will be in a worse off position. Attempting debt settlement is also a good strategy to employ should bankruptcy still ultimately results at the end of the day. This is because debt settlement will be reflected in your credit report and shows that you did try to do something worthwhile with your outstanding debts.

Though debt settlement looks like a good strategy to employ, it should only be used in the last resort rather than being a habit. Being continuously late on payment gives a bad credit score standing and risks your outstanding debts spiralling out of control. Use it only when you have a lump sum available to make an attractive offer to your creditors to settle a larger amount. Your aim is to wipe out that big chunk of outstanding debts so that it does not continue to haunt and stress you day in day out.

If you find that you are not made out to be a negotiator or if you lack confidence in that department, then set out to survey the debt settlement companies available in the market. Inquire about their experience and the fees involved in helping you to negotiate and settle your debts. If the fees are going to eat up a huge amount from what you have to pay as a lump sum to your creditors, then you might not have much to bargain with at the end of the day. Find out about their company and ask for referrals to get some feedback on their experience dealing with the former.

How can I become debt free ?

If you were to thrown a stone towards a group of people on the street, chances are you will hit someone who is experiencing some sort of debt at the moment. But don’t do that. It’s just an illustration of how debts have become part and parcel of many people’s lives. Is it really a dead end where debts are concerned? Many people out there are at their wits end trying to figure a way out of their financial misery. Is being debt-free an illusion and something which cannot be achieved? Well, you should read on and chances are, you will find some practical tips here to help you stay out of debts or start you on your way to becoming debt free.

Live Within Your Means.
That is so true, isn’t it? How many times have parents told their children or elders advising the young to live within their means? Unfortunately, many try to keep up with the Joneses and spend above their means with credit cards being the chief culprit. Keep track of your expenses and make sure it is not more than your income. Create a budget and live within it.

Save Not Just For The Rainy Day
Some say “I am saving for the rainy day”. But I say “Why just save for the rainy day?”. Start saving today. Take at least 10% of your income and stash it away in good investments like fixed deposits (which guarantee income albeit not much), unit trusts (which may or may not generate income depending on the risks involved) or even stocks and shares. Save them for the long haul especially for your retirement and keep in mind the inflation rate as your $100 today is unlikely to go far in 10, 20 or even 30 years’ time.

Money Management Is The Key
You don’t have to be a qualified accountant to become a good manager of your money. The key to money management is discipline. You can be a qualified accountant but if you are not disciplined enough with your monies, you will still find yourself spending more than necessary and incurring unnecessary debts. Set your short, medium and long term financial goals and determine how you want to achieve these goals. Does it mean saving more each month? Spending less on entertainment? Allocating more to investments? Whatever you plan, make sure you are disciplined enough to stick with it with no deviation.

Plastics Are Environmentally and Can Be Financially Harmful
Credit cards. The plastics you don’t leave home without. It can be a good friend but it can also be a devil if you fail to exercise prudence with your spending. Do you know how much money you have at hand before you decide to swipe that credit card of yours for your latest purchase? Do you actually need so many credit cards? Make it a habit to pay your credit card expenses in full whenever they are due. Make it your goal never to allow your credit card issuer to earn interests from you. I promise you it gives you immense satisfaction to find that you are being given a credit card with good facilities for free when you pay your card in full every month and the credit card issuer gets nothing out from you in interest charges.

Do you find the above tips common? I don’t fault you if you do but those tips have long been recognised as ways to deal with the most common of debt incurring reasons. They are obvious but not many people follow these time tested methods to stay debt-free. Are you already following them or will you be?

What is debt consolidation ?

You are indeed lucky if you are not a borrower of some sort. Most working adults are borrowers and sometimes this could not be helped due to their financial background or needs or just to cope with the Joneses. Borrowing, and we mean borrowing from financial institutions here, will invariably cause you to end up owing more especially when you borrow from a few financial institutions for different things like house mortgage, car hire purchase and the like.

What about this facility called Debt Consolidation? What makes them stand out in the midst of the various financial facilities available? What sets them apart from the usual loans out there? Well, Debt Consolidation Loans are loans which are assist you to deal with the various loans which you currently have.

In a nutshell, what it does is to consolidate all your loans into one single account. Assuming you have 3 different loan accounts which have 3 different payment due dates, having a Debt Consolidation Loan would mean that this Debt Consolidation Loan will cover the three and you only need to service the payment once a month. This ensures that you do not miss out in your repayment especially when you have different payees to deal with and at different times. Missing out on a repayment even by a couple of days would mean having to pay penalties and interests which will place a further financial burden on you, not to mention giving you a bad credit rating.

As Debt Consolidation Loans are highly competitive in the market, it is most likely that the interest rates are lower than conventional loans. It is therefore a good option to consider if you are currently struggling to pay off your credit card debts or overdrafts which usually carry higher interest rates. Why pay more when you can consolidate all these loans or debts which comes with high interest rates into a single Debt Consolidation Loan with lower interest rates?

When you consider a Debt Consolidation Loan, it gives you a second chance to restructure your current outstanding debts. It may mean giving you a breather in terms of a lower interest rate or a longer repayment period or a lesser amount payable per month. Sometimes, people might be in certain emergencies which render their financial situation precarious – eg, a fall in the share market or medical emergency requiring substantial expenses incurred. A Debt Consolidation Loan can help to give the breathing room needed.

Of course, you will have to do your maths to ensure that at the end of it all, the benefits of using a Debt Consolidation Loan outweights your current debt situation. If you were to choose a longer repayment period, will your total interests payable over the period be much more compared to what you are currently incurring? Choosing a longer period to repay your Debt Consolidation Loan also means having a debt lingering over your head for a longer period of time.

You must also ask yourself whether you will be financially disciplined once you have consolidated your loans into one single loan. If you fail to do so thinking that you have a lesser amount payable and thus spend more instead, you might find yourself down the road to further financial misery. Running up fresh debts is not difficult to do especially with the instant lure of credit card spending. You definitely would not want to go back to square one or in a worse off position.

What is a fixed mortgage ?

When you are ready to buy a new home, you likely want to jump right in and go straight to finding the home of your dreams; however, there are other things to consider. Financing can be a big concern for many would-be home owners. Some are curious about what options are available to them, while others worry about if they can even get financed at all.

To answer the first concern (the second concern is more about each individuals situation,) there are several types of mortgage loans available for you to choose from. The most popular type is a fixed mortgage loan.

A fixed mortgage loan is the type of loan that most people financing a home ask for. There are many characteristics that, when taken together, help identify a fixed mortgage from other types of loans, such as balloon mortgages or ARMs. Some identifying traits include:

Payments on a fixed mortgage loan remain constant throughout the life of the loan. You will pay the same amount each and every month until you have repaid the entire amount.

You can take out a fixed mortgage loan for up to 30 years. How much you pay each month will be determined by the ‘life’ of your loan. For example with a 30-year fixed mortgage loan, the mortgage company will take the total amount of your loan (principle + interest) and divide it by 360 months (the total number of months in 30 years) to arrive at your monthly payment amount.

Your interest rate will also remain constant throughout the life of the loan.

This type of loan is the most stable and predictable, which is a big reason why it is favored by so many home owners. Once you have secured your financing, the only thing left to do is to find your new home.

What is a balloon mortgage ?

Financing a home can be easier to pull off when there are more options available to you. Some people hope to buy a home now, when their income is not as high as they’d like it to be, rather than wait 5 to 10 years for their situation to stabilize. This is a concern that can be addressed by taking out a balloon mortgage.

A balloon mortgage is a financing option that gives home buyers an easier time within the first 10 to 15 years and then caps that period off with a request for the balance of the mortgage paid immediately. This “easier time” may be realized with a lower monthly payment, lower interest rate, or both.

For example, with a balloon mortgage you might pay $750 a month for 10 years (a grand total of $90,000) and then have a balance of $60,000 that will be due immediately. While such a ’small’ balance may be workable for some, for others it may not. Additionally, those who purchased more expensive homes will also have a much larger balance to pay off. The person in the above example may have chosen a balloon mortgage to reduce their payment by $250 or $500 a month or they may have gotten a point shaved off of their interest rate.

The problem with this type of mortgage is that sometimes that ‘lenient’ 10 to 15 year period can sometimes creep up on homeowners quicker than they think. They haven’t made a large dent in the amount that they owe and their financial situation has not improved enough to allow them to pay off the rest of the mortgage all at once. The good news is that you can refinance this remaining amount, assuming that you still qualify for a loan.

All in all, a balloon mortgage is great for those who want an alternative to a traditional fixed rate mortgage and who also don’t want the interest rate fluctuations that come with an adjustable rate mortgage (ARM), the other most popular alternative to a traditional fixed rate mortgage.

What is a seller’s realtor ?

If you plan to sell your home or a property you have invested in, the first thing you should do is find your own realtor. Now keep in mind that this will cost you a percentage of the overall selling price of the home and may cut into your profits, but you may still end up with more profits by using a realtor to advertise your home than by going it on your own.

There are many advantages for seller’s who hire their own realtor. Some of these advantages include:

Your realtor will work for you and try to get as much money out of your home as possible, while reducing the amount of fees you pay towards the buyer closing costs. This is a definite plus since the buyer’s realtor will try to get the property for as cheaply as possible and try to get you to fork over some of your profit to help pay the buyer’s fees.

Your realtor will know best when it comes to when, where, and how to advertise your property, plus they have full access to the MLS.

Since selling properties is what your realtor does for a living, they can give you time and money saving advice that may help you sell your property quicker. After all, they know the ins and outs of the market better than anyone.

All in all, a realtor will help you get the most out of your selling experience and shorten the time your property is on the market. If you are ready to sell your property or have more questions about the process, you should contact a realtor in your area; one that can help answer all of your questions and get your home on - and off - the market quickly.

What is a buyer’s realtor ?

Buying a home is a big, important step in your life, so it is important that the transaction go as smoothly as possible. When you search for a home it is important that you secure your own realtor, rather than relying on the realtors who are hired by the seller of the homes you are looking at. There are many reasons why having your own realtor is important.

A seller’s realtor looks out for the seller’s best interest, including when it comes to price. However, your own realtor will look out for your best interests and try to get you the best deal possible. Not only will having your own realtor be an asset when it comes to negotiating a price for the home, but your realtor can help protect you through the entire process - all the way down to the closing.

Your realtor can help you with the ongoing search for your home and search the MLS for homes that you may like. This will help shorten the time that you invest in the search for your new home.

The best thing about getting your own realtor is that you don’t have to pay them for their services. Instead they will get a percentage of the closing price - which comes out of the seller’s pocket.

If you are ready to take the plunge and begin looking for the home of your dreams, make sure you first get a buyer’s realtor; one who can help save you time, negotiate a fair price, and protect your interests all the way through closing, without costing you a dime. You have absolutely nothing to lose and can gain the benefits that come along with a smooth buying process.

Should I buy a house ?

It’s a lot of people’s dream and something that many people work hard all of their lives to accomplish. What is it? Owning your own home. There are risks and benefits to everything in life and owning your own home is no exception; however, in this instance, the benefits almost always outweigh the risks. Let’s take a look at some of these benefits of owning your own home.

Owning your own home gives you a place to call your own. It’s not some place you are renting for the time being, but instead is someplace where you can build a foundation for the rest of your life – a place to build your life around.

It gives you and your family a sense of permanency, instead of feeling like you may have to uproot and move at anytime. This may be important for the emotional security of your children.

A home is an asset that you can continue to build equity in. The more you build up equity in your home, just by living there and paying your mortgage, the more you increase your own net worth. This may also come in handy if you ever find yourself in need of money, as you can always take out a home equity loan.

As you pay down your mortgage each month, you know you are making an investment into something you will eventually own outright, rather than just lining the pockets of another person with money you will never see again.

You will be able to enjoy special amenities that you may not have in an apartment, such as a yard for your kids to play in or a garage for your vehicles.

A home is something that you can pass on to your children some day – free and clear. This will allow them to reap the same benefits you did from owning a home.

These are all important benefits that make home ownership priority number one for many people. A home helps to give you and your family security and peace of mind.