Upfront Payment in Home Loans - Fixed or Negotiable

Upfront payments mean the amount other than the property value of the house. Applying for a home loan and selecting a best home loan deal does not involve knowledge of upfront payments. This is very important as this also comes to a substantial amount.

Loan can be got on a certain percentage of the total amount of the flat. There is no mention anywhere in media regarding the amount payable as upfront payments. This has to be discussed personally with the builder before going in for a home loan. There are various administrative fees, infrastructure costs, facilities and amenities that are offered at a special price and also rise in amount of house for every floor rise. Parking facilities under the stilt also require to be paid for separately sometimes. All these costs and also other administrative costs come to a substantial figure and one has to accept this without questioning as one has taken the decision of selecting a house and best home loan lending institution offer.

It is very important to note that these amounts are negotiable. It is not fixed as there are no rules for these amounts. Even the amount for area per square foot is negotiable. As also the rates for other amenities can be discussed and come to a decision of a comfortable amount. Offers for special categories are also available and one must enquire about such festive offers or professional loan offers at lower interest rates. Special amenities offered at extra costs can also be selected and payment fees negotiable.

Negotiations on upfront payments will reduce your initial payment load. Knowledge regarding home loans is essential in today's world of finances where on one end there is easy availability of home loans and simple procedure for procurement for the same where as at the other end false claims and misleading advertisements lead to sometimes having the purchaser ending up paying more!

Rizwana A. Mundewadi is a freelance Healing Artist and writer. Using her experience in the last decade she has been writing articles related to art, art investment, feng shui, symbolism, prosperity and good luck and has also added to this list her practical experiences with banking, loans and investments. Simplified facts about home loans can be found at http://homeloans-simplifiedfacts.blogspot.com without the technical jargon associated with this topic.

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Home Loans and the Amount Available As Home Loan

Home loan is a term synonymous with a fulfilment of purchasing a dream home easily and quickly. Though nowadays it has become very easy to apply for a home loan with simple and easy procedures and many competitive financial institutions offering loans one has to consider their own choices and priorities while selection. Loans available for first and second homes are offered by many private lenders as well as government banks and financial institutions at attractive interest rates.

All the discussions prior to the selection of a home cater to the area, facilities and perks offered and the lifestyle amenities that come along with the home. We consider the rate per square foot in that particular area, a reputed builder and select a home. Now comes the tricky part when we go in for the application for a home loan. We come to realise that there are other costs and expenses for the procedures as also administrative fees which have to be borne by the buyer. There is a certain percentage of down payment which includes administrative costs, transfer agreement fees, parking and other facilities, gymnasium one time fees, garden maintenance fees and so on and so forth!

The loan amount calculations and EMI figures available online by different financial lenders is subjective and only for reference purposes and the actual amount only comes forward when one goes to do the final deal. Also every floor rise for apartment is added tot he value of the home and thus a flat on a higher floor is more than a first or ground floor flat. This amount may vary from 15% till even 40% increase in the total amount of the home. As also the home loan calculations and eligibility criteria are also subjective and may very from individual and financial institutions.

So it is important to be aware that easy home loan availability is a boon but one must also be prepared beforehand with a substantial amount and then proceed about going in for a home loan.

Rizwana A. Mundewadi is a freelance Healing Artist and writer. Using her experience in the last decade she has been writing articles related to art, art investment, feng shui, symbolism, prosperity and good luck and has also added to this list her practical experiences with banking, loans and investments. Simplified facts about home loans can be found at http://homeloans-simplifiedfacts.blogspot.com without the technical jargon associated with this topic.

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What Are the Loopholes While Taking a Home Loan?

Purchasing a home is one of the dreams of every individual and everyone wants to purchase a home of ownership. Increasing costs of property and inflation has made it difficult to purchase a house of own. Here home loans have come as a good way to purchase our dream home now and enjoy this while the loan is being repaid over the years. Simple terms like best home offers and best interest rates are heard everyday but are not understood by all. There are various loopholes in the offers given by the builders and also the lending financial institutions.

Let us consider the loan amount availability. We give so much thought on selecting a place and area for purchasing a home. Rarely is it thought about that institutions do not offer loan on total amount of the property. Only certain amount is offered as home loan and rest has to be paid as down payment. This also caters to a substantial amount. The lowest interest rate advertisements are flashed everywhere and one can easily get carried away and select a home loan deal which may appear attractive but may make the client may more in the long run. Low interest rates may be publicised and interest rates for later years may be kept flexible thus increasing in substantial repayment amount over the years. Figures and quotes of amounts are only for indicative purposes in advertisements and the real figure comes to much more than mentioned by the advertiser. Property ownership and title deeds are never mentioned and one has to ask personally about the clear title and ownership of the property before going in for a home loan on the house selected. Many times other hidden administrative costs are not mentioned anywhere and all these come up during the final deal for the purchase of the house. Facilities like car parking, registration charges, stamp duty, society formation and other amenities offered are not mentioned with the deed and the borrower has to pay this amount on the purchase and this is also not included in the loan amount.

Hence one has to be very careful before applying for a home loan and selecting a home. Though purchasing a dream home is one of the best aims for every family and also there is easy availability of home loans, but still there are many points which if considered beforehand help to avoid financial stress and inconvenience later on.

Rizwana A. Mundewadi is a freelance Healing Artist and writer. Using her experience in the last decade she has been writing articles related to art, art investment, feng shui, symbolism, prosperity and good luck and has also added to this list her practical experiences with banking, loans and investments. Simplified facts about home loans can be found at http://homeloans-simplifiedfacts.blogspot.com without the technical jargon associated with this topic.

Article Source: http://EzineArticles.com/?expert=Rizwana_Mundewadi

Essentially the Most Regularly Asked Questions We're Currently Receiving About Personal Loans

My husband and I are going to the bank to apply for a household loan. Any assistance?

I'm assuming you'll essentially speak with an individual whenever you go to the bank. In which case:

1) Make sure that that your credit report has no funny stuff in there. (Credit cards you did not open, vehicles you didn't acquire, and so forth.)

2) Ask the loan officer these questions (listed in no specific order):

a) What shall be the rate of interest?
b) Will there be a prepayment penalty?
c) Will the interest rate be variable or fixed? If variable, how sometimes can it alter.
d) What are going to be your approximate monthly payment?
e) What would be the life of the loan? (in years)
f) What occurs for those who refinance the loan?
g) What happens should you sell your house?
h) Are you qualified for any unique gives? (often, the greater your credit rating, the lower the interest rate along with other terms you could get)

You will discover a bunch of other questions depending on your status and your specific predicament. But those are the really simple issues you ought to ask.

What's the best approach to finding a student loan?
Go to a good bank, or to the financial aid dept at the college ur wanting to attend, those are your perfect bets...be leary of these infomercials and radio stations speaking about how hassle-free it really is to obtain income, you can get in over your head in debt and end up being inside the poor house having a college degree!

Guidance for somebody finding their very first student loan?
Be sure your fafsa is filled out appropriately. Apply for every scholarship you'll be able to...go to fastweb.com wiredscholar.com and brokescholar.com they are excellent scholarship web sites. Speak to your financial aid department. ask about school scholarships that they've and other possibilities. THEN, apply for loans, go for government loans 1st, they generally have lower interest rates and do not require a cosigner. Then, for those who nonetheless want way more money right after the government loans study private banks quite properly, what are their interest rates? Rate of payments, can you defer your payments? How long will you be generating payments? Take this all into consideration, talk to your parents or an additional adult and see which loan could be preferred for you before you sign any promissory note.

Most effective Place for a Loan or Guidance?
I think decent guidance would begin by asking how much you Will need the loan - and if it is for a thing seriously important like an operation, regardless of whether you mightn't be far better to (for instance) extend your mortgage, which would undoubtedly be less expensive.

If you ask a bank or building society, they're going to attempt to sell you something. If you ask a financial adviser, ensure he's totally independent (ie he need to be charging you for the advice).

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The Difference Between Bridging Loans And Bridging Finance

Bridging finance, as the name itself suggests, helps in creating a bridge between two transactions. But such kind of loan is very much able to serve the financial needs of a property developer whether taken for first charge or second charge account. Closed loans have a fixed date by which the loans need to be repaid in full. Being less risky for the lender it comes with low interest rates. However an open kind means a loan which is not bound by fixed contract terms. This type of loan is of course greater risk for the lender and therefore come with higher interest rates.

These kinds are very flexible in nature. They have the capability to cater to needs of all types of clients ranging from individuals to small firms. They also provide concession on loans for people who have high credit history rather than those who faces problems in getting loans and mortgages.

Purpose For Bridging Finance

Bridging loans are normally meant for purchasing newly furnished homes even before the existing property of the borrower is being sold. These loans are mainly meant to address the monetary needs of the people in the real estate industry. Bridging finance is also there to serve big property developers and builders.

The main clients of bridge financing industry are property conversions, private building projects; land acquisition and property developers. These kinds of loans are popular in real estate investment markets. For example in property auctions the buyer is given a time period of 28 days to complete the transactions and he might not get payment for sale of his old property within that time. Here such loans help a lot.

Again for re mortgaging purposes kinds of loans work very well. When there is an extreme delay this loan helps in meeting first mortgage payment, while a better mortgage plan is being prepared. This helps a lot in meeting the financial requirements and fulfilling the gaps. It can also be used to add up investment capitals or to meet a special investment circumstances. Thus it has got multiple purposes.

In bridging finance speed is the most important factor. It normally takes one week for processing of these bridging loans. However it also depends upon the attorneys, how efficiently he can fulfill the requirements of such loan transfers. A financial broker also helps a lot in accomplishing the whole process of fund transfer.

The payment options are also flexible like the loan itself. There are monthly payment options with interest charges. The client can also request for their choice of rate of interest. Here the principal amount can be paid at any point of time in order to decrease the interest payment.

In order to get more information about bridge loans, one needs to log on to mayfairbridging.com. They offer quick and reliable bridging finance. Their philosophy is to work in a responsible and transparent manner.

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You May Still Have Time To Receive Your Remortgage Or Secured Loan This Year

It is still possible to obtain a remortgage or a secured loan before New Year.

The fact is, that if someone applies for either of these homeowner loans right now, they could still have their funds before the year ends.

This is actually a good time to apply as it means that the money will be available for all the great bargains in home improvements, holidays, etc. available at the end of the year. Immediately after New Year,retailers reduce their prices in an amazing fashion, as if they did not, it would be probably the quietest period of the year,as people have very little money at their disposal after the overspending of the festive season.

It is possible to purchase kitchen and bathroom suites, conservatories, etc.discounted by as much as 70%, and this is quite a bargain and a very cheap way of adding to the value of a property, apart from making a home more comfortable.

Holiday companies and hotels also find the beginning of the year a bad time to attract customers, that is if they did not reduce the cost of their goods.

As such, it is possible to stay in a luxury hotel on a bed and breakfast basis for as little as £50 per night.

Foreign vacations are available at bargain prices.

Car dealer ships also frequently reduce the cost of their vehicles at the same time.

Therefore for homeowners with equity in their property, there is no better time than now to apply for a remortgage or a secured loan, to be in the position to buy one of the many bargains available.

It is not too late if they apply right now.

When someone applies for a secured loan, they must first of all receive a copy of their credit agreement along with an application form and a request for the information needed by the lender or broker to complete the loan application.

The information needed is income proof, proof of residency dated less than two months ago, and I.D. in the shape of a driving license or a passport.

The applicants then must be allowed at least an eight day cooling of period before they are posted the agreement to sign.

When the information and the signed agreement are obtained by the loan provider, the cheque will be sent to the borrower as long as the needed information regarding the mortgage conduct has been received.

A remortgage lender asks for the same information, but unlike some secured loan lenders, they also ask for three months bank statements.

After the mortgage lender has received all the information, their solicitor sends the remortgage offer to the homeowner.

Therefore for any homeowner considering either a remortgage or a secured loan, they can still obtain the money by the time they want to buy one of the many bargains on offer at that period of the year.

When you want a remortgage, mortgage, secured loan or are seeking debt advice look no further than Champion Finance. They have been arranging secured loans since 1985 and also provide whole of the market mortgages and remortgages. Helpful friendly debt solutions of all kinds are available including debt consolidation., etc.

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Effect of a Bad Credit Rating and How to Fix It

Credit card is a very useful tool if used properly. The problem is most people do not know how to handle these cards properly, which results to great debts. Being unable to pay your debt on time will damage your credit rating and will make it hard for you to borrow money whenever you need it.

If you are looking to loan for an amount that you will be using to start a business, you can approach a local bank. Once you have applied for the loan, the bank will check your credit background, if they found out that you have a bad credit history, they will either be rejecting your application or will be giving you an amount much lower than what you are asking for.

Another problem caused by bad credit ratings is the chance of losing your job. There are a lot of companies who do not accept employees who manifest a negative credit standing. Whether you are an applicant or a regular employee, you will be rejected from the company once they found your negative debt history.

Getting an apartment is also hard for people who have outstanding balances to credit card companies. Before you can take an apartment, owners or landlords will check your credit history, once they found that you have a bad debt standing, they won't allow you to get an apartment or a house to live.

These are some of the worst things that will happen to a person who fails to pay all their bills on time. If you don't want to suffer from these problems, you need to be prompt when paying for your debts. The best thing that you can do in order to help you clear of all your debts is to focus all the money that you have in paying one debt at a time.

Paying all your debts at the same time won't help you clear your credits easily. If you kept on paying debts separately, the interest rates will only eat up your payment, making it seem like your outstanding balance is not changing at all. Start by paying the lowest amounts first because most of the time, these are the ones that have higher interest rates.

Clearing your debt one by one is the best way to clear all your obligations. Follow this simple rule and you will notice that after a few months, your debt is slowly being reduced. Avoid taking unnecessary loans until you have cleared all your debts.

I did a little research for you. Start getting out of debt, possibly as early as this week.

Complete a few short questions and you will be on your way. Visit Debt Relief Solutions

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How Can A Business Credit Card Help Keep Track of Your Expenses?

Keeping track of records is the life blood of any business. For many small business owners keeping track of business expenses can become an overwhelming task. This means that you need to keep all your receipts and properly categorize each expense. After you categorize your expenses you then need to keep a total for each. In case you are ever audited, you will need all your records in order to prove that your right offs are legitimate. All this work can be very tedious, however, a business credit card can help you keep track of your expenditures without much effort on your part.

The Internet has revolutionized the way we keep track of our lives these days. Most, if not all, credit cards come with an online system than allows you to log on see how much you have charged. Online systems keep track of everything for you automatically. It will categorize your expenses for you as well. If you use your charge card at a restaurant than it will keep track of that expense under the entertainment category. At the end of the year, your card issuer will send you a statement that details all your expenses for that year accordingly. Every time you use your credit card it will automatically keep track of your expenses for you.

Use your charge card for all business related expenses as much as you can. These days, everyone uses a some sort of debit or credit card when they make purchases from anything to a soda to round trip airline ticket. Use your card when ever you have any kind of expense related to your business. Do not worry about charging a small amount. Use your credit card for any amount purchase that is business related. Business card providers take care of most of your accounting work for you if will let them. It is very easy to loose receipts, especially for small purchases. You avoid any chances of loosing the receipt by charging on your business charge card.

Most credit cards will also work with your accounting software. In other words, you can download your card statement from your issuer and import everything into your Quickbooks or Microsoft Money accounting program. Once you have downloaded the data your accounting software will then properly categorize each expense for you. Most accounting programs that run on today's personal computers will determine the expense classification based on where the expense was made. For example, if you make a purchase with your charge card at Office Max, your accounting software should automatically categorize that expense for you under office supply expense. If it does not recognize where the transaction was made the system will ask you what expense category you want to use for that purchase. It will than remember next time under what category you used when the software comes across the same expenditure again.

What other benefits does a credit card offer?
Use your business card as much as you can whenever you are making business purchases and your life will become a lot easier. In addition, many business credit card providers feature cards with great reward offers that can make your life easier as well. Reward points can then be used to make purchases such as gift certificates, cash back discounts, or even airline tickets to the destination of your choice.

Lastly, use your business credit card to its maximum potential and you will not only save money but increase your productivity as well. Keeping track of petty cash receipts can become very cumbersome for any business. Receipts can easily get lost or torn before they ever make it back to their proper filling place. All this can be avoided by using your charge card to make whatever purchases you need to make. You can then quickly download all your expenses from your online account to accounting software such as Quickbooks Pro or Microsoft Money. Lastly, always remember to always use your business credit card responsibly.

Todd Holliday is an avid writer who enjoys subjects such as apply for a credit card and cash back credit card offers.

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How the FDIC Affects Your Wallet

You might be surprised to learn that the FDIC is not funded by tax payer revenue, so it receives no Congressional appropriations. Rather, it’s funded by premiums that banks and thrift institutions pay for deposit insurance coverage and from earnings on investments in U.S. Treasury securities. With an insurance fund totaling more than $45 billion, the FDIC insures more than $5 trillion of deposits in U.S. banks and thrifts – deposits in virtually every bank and thrift in the country.

Banks and thrift institutions have to comply with a host of regulations and safe operating guidelines designed to protect depositors and their money. In many ways, the FDIC could be considered a consumer protection agency as it supervises and regularly examines insured banks to make certain they are operating in safe and sound ways, thus protecting customers and their deposits.

On October 3, 2008, FDIC deposit insurance temporarily increased to $250,000 per depositor through December 31, 2009, but there is legislation currently proposed in Washington to keep the $250,000 coverage permanent. Many experts believe this will pass with little resistance, but only time will tell.

Your money in savings, checking and other deposit accounts, when combined, is generally insured to $250,000 per depositor in each bank or thrift the FDIC insures. Deposits held in different categories of ownership – such as single or joint accounts – may be separately insured. Also, the FDIC generally provides separate coverage for retirement accounts, such as individual retirement accounts (IRAs) and Keoghs, insured up to $250,000. The FDIC’s Electronic Deposit Insurance Estimator can help you determine if you have adequate deposit insurance for your accounts. We’ll cover ownership categories in more detail in our next installment.

The FDIC, Your Bank, and You

We’re launching our blog with a short series of posts dedicated to how we work with the Federal Deposit Insurance Corporation, or FDIC, to protect your hard-earned cash. (With bank failures and economic doom-and-gloom all over the news we thought it a good place to start.) But before we get into specifics, we need to provide a brief history of the FDIC and its role as a consumer protector.

The FDIC was created as an independent agency of the federal government in 1933 in response to the bank failures of the 1920’s and early 1930’s. The FDIC is headquartered in Washington, D.C., but conducts its business in Utah from a field office in Salt Lake City. This field office works closely with the Utah State Department of Financial Institutions to oversee the safety and soundness of many of the state’s banks, including Western Community Bank. Since the start of the insurance program on January 1, 1934, no depositor has lost a single cent of FDIC-insured funds from a bank failure.

The FDIC insures deposits only. It does not insure securities, mutual funds or similar types of investments that banks and thrift institutions may offer. (See Insured and Uninsured Investments on the FDIC website to determine what is and is not protected by FDIC insurance.)

Upcoming installments will cover “How the FDIC Affects Your Wallet,” “How to Make the Most of FDIC Insurance Coverage” and “How the FDIC Affect’s Your Bank’s Service.” We hope these posts will help you gain a better understanding of how you can better protect your hard-earned cash, and how your bank is working to protect you.

Make the Most of FDIC Insurance

Our last post made reference to the FDIC’s Electronic Deposit Insurance Estimator, or EDIE, to help you determine if you have adequate deposit insurance for your accounts. Today we’ll delve further into ways you can make the most of available FDIC deposit insurance coverage.

Perhaps one of the best features of FDIC deposit insurance is that’s free. You qualify for it simply by opening a qualified deposit account at an FDIC insured bank. How much insurance you can receive is a different matter. The amount of coverage is based on factors such as the amount of money you have in an insured bank, the type of account, and the kind of ownership category the account falls into.

You can never receive more money than you have in your deposit account. Traditionally, the FDIC has insured deposits up to $100,000 per depositor, but on October 3, 2008, FDIC deposit insurance temporarily increased to $250,000 per depositor through December 31, 2009. So this means if you and your family have $250,000 or less in all of your deposit accounts at the same insured bank or savings association, you do not need to worry about your insurance coverage – your deposits are fully insured. A depositor can have more than $250,000 at one insured bank or savings association and still be fully insured provided the accounts meet certain requirements

You may qualify for more coverage if you own deposit accounts in different ownership categories. The best source of information regarding ownership categories is the FDIC. So to help you determine how you can establish your accounts in the proper ownership categories and to help you maximize your coverage, we suggest you take some time to review the information on the FDIC’s insurance coverage info page.

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The Princess and the Penny

Do you remember the story of the Princess and the Pea where a pea is placed below a ridiculous stack of mattresses to help a desperate prince determine if a traveler claiming to be a princess really is a princess? The prince thought if the woman could feel a pea through all those mattresses that she had to be a princess, because “only a princess could have skin so delicate” as to feel that small irritating pea under all of those mattresses. Sure enough, the woman proved to be a princess. She did not sleep all night because she could feel the tiny irritant under all the mattresses. Imagine what she would think today sleeping on one mattress with a penny-or a stash of money-stuffed under it.

Admittedly, this story is recalled in order to make a point: As bad as the economy is, or may get, the mattress is not the smartest way to save. If you don’t want to loose sleep over the safety of your money, or sleep with an annoying lump in your bed, do some homework and find a safe and secure bank where you can open a simple savings account. You will have greater peace of mind knowing your money is FDIC insured and that your bank is working hard to deserve your trust.

Remember that the bank failures you’re hearing about in the news are typically large banks, and that there are thousands of smaller institutions, like community banks, that continue to operate in safe and sound ways. What’s more, your local community bank is most likely owned, managed, and operated by people in your community who understand your needs, the local economy, and the issues that affect your neighborhood.

Resist the temptation to open a “restless-nights-sleep account” and open a simple savings account at a trusted local community bank instead. You’ll sleep better.

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Benefits of “Going Local”

“The past few years have seen increased emphasis on “going local,” or supporting local communities by consuming products that are produced and sold by independent organizations rather than big-box, franchised retailers,” according to American Fork City Councilman, Dale Gunther in an article published in the February 2009 Utah County Business Journal. “The trend has really taken off…because it helps local communities thrive by reinvesting local dollars at home.”

“While it’s natural to think of products such as produce and art as part of the “going local” movement,” Gunther continues, “one product that is often overlooked is the community bank. Yes, the community bank is indeed a local product that supports local communities.”

So what are some benefits to banking with a local community bank? Here are a few cited by Mr. Gunther:

• “Community banks are locally owned and geographically centralized. This means the money deposited by citizens in your town is generally loaned back to citizens in your town” – not citizens or businesses in other states or even counties.
• “Local management also means faster decision making and less red tape.”
• “At community banks, there are fewer layers to get to the top, which means you have easier access to executives.”
• The employees of community banks are almost always from the community. They “know the community and have been working at the bank long enough to know how to best meet the needs of the community. They know the market and have a vested interest in seeing the local economy succeed.”
• Smaller banks are better to work with you when you have problems with your account. “[They] work with you to avoid fees in the first place and, when incurred, they don’t sting as much as those of their bigger brethren.”

When you consider “going local,” do as Mr. Gunther suggests and “realize that as much as spending locally lifts communities, saving and borrowing locally does, too,”

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“How much should I have in savings?”

It’s not often that I read the magazines in the break room–partly because I could care less what’s going on with Brangelina or because I have no interest in making cupcakes look like butterflies. But I confess to opening the April 1, 2009 issue of Family Circle Magazine a few days ago and stumbling upon an article by Kate Ashford titled “Financial Planner.” The article was shorter (much shorter) than I expected, but there were some good bits of advice.

“Confused by the economy?” Ms. Ashford begins, then answers four (only four, mind you) finance-related questions. I’m not going to repeat them all–you can click the link to the article above if you want to read the entire piece. The third question and response is worth sharing here because I hear this question with some regularity when I’m in the bank, and when people I meet find out I work at a bank:

“Q. How much should I have in savings?

A} At least six months of living expenses. The general rule of thumb has always been that dual-income families should have three to six months of living expenses accessible in a savings account…But fewer than 40% of adults have enough in savings to tide them over for even three months, according to Bankrate.com. And now that the economy is so uncertain, experts are leaning toward six months. “If someone loses his job, it’s anybody’s guess how long it will take to become employed again,” says Donald E. Whalen, a certified financial planner in Alpharetta, Georgia. But don’t get overwhelmed by the thought of having to save so much money-”living expenses” doesn’t mean cash for leisure activities. It’s the money needed to cover bare essentials, like mortgage, food, and health insurance.”

To beef up your emergency fund:

A) Set up a weekly automatic debit from your checking account into a high-interest savings account, and increase the amount when you can.

B) Raise the deductibles on your home and auto insurance, or shop around for a better deal, and then stow the difference in a savings account.

C) When you finish paying off a credit card, keep making payments-to your emergency fund.

D) Try bundling expenses (like getting phone, Internet and cable from one company) then stash the savings.”

These are great ideas, and the emphasis is clear: Look for places to cut expenses and then save the money rather than spend it. For more ideas on how to save money, check out some of our past posts.

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Half-empty or Half-full?

The US Department of Labor released a report today stating that the national unemployment rate rose to 8.5% in March 2009 — the highest level since 1983. At the risk of sounding a little heartless: So what? What does this often quoted statistic mean to me and you? It’s 8.5% of what? How does Utah, or Utah County, or Orem, Lindon, Pleasant Grove, or American Fork fit into this statistic? These are all good questions that deserve some attention. So here goes…

The unemployment rate is a measure of the percentage of the work force that is unemployed at any given date–which means that 91.5% of the work force is still employed according to the March 2009 numbers.

How does this affect us locally? For simplicity’s sake, let’s take a look at February’s statistics, because we have them for the nation and state. In February 2009, the US unemployment rate (or sometimes called jobless rate) was 8.1%, which means that the 91.9% of the workforce who wanted to be employed had a job. The rate for the same period in Utah was 5.1% (or 94.9% employed). This puts Utah at number six on the list behind Wyoming (3.9%), Nebraska, North Dakota, South Dakota, and Iowa (4.9%) out of the 50 states and Washington D.C. In the Provo-Orem and Salt Lake City Metropolitan Statistical Areas, the rate was 5.2%. This places our local rate at 27 on a list of 372 other Metropolitan Statistical Areas.

We all know we’re in turbulent economic times, but in our neck of the woods we’re not being impacted as heavily as other areas of the country, and we’re not getting through it unscathed, either. Have we seen the worst of it? Probably not. Is the glass half-empty? No. There is still plenty to be thankful for, because it surely could be a lot worse for many more people.

Chances are high that you know someone who has been laid-off or needs a job. Do them a favor by keeping your ears and eyes open for opportunities, and let them know about what you see or hear. History tells us that communities that work together are usually better insulated against downturns as each member helps his or her fellow citizens. The situation will get better. At a recent event I attended, Steve Forbes, the Chairman and CEO of Forbes, Inc., and Editor-in-Chief of Forbes Magazine, said, “The world can only end once–and this is not it.”

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Tax Fun Facts

Is it really fair to place the words “tax” and “fun” next to each other? We’ll let you decide, but with April 15^th bearing down on us, here are some interesting–if not fun–tax facts to divert your thoughts for a few minutes and hopefully lift your spirits.

• The first property tax in the United States was in 1798.
• The first US income tax started during in the Civil War to help raise money back in 1862.
• The first federal tax office in the US was the Office of the Commissioner of Internal Revenue in 1862.
• The 16th Amendment, ratified in 1913, established the first permanent US income tax. Four states rejected the amendment: Connecticut, Florida, Rhode Island, and Utah, and two never considered/discussed it: Pennsylvania, Virginia.
• The Gettysburg address, one of the greatest speeches in U.S. history, has 269 words. The Declaration of Independence contains 1,337 words. The Holy Bible consists of 773,000 words. Yet there are over 7,000,000 (not a typo that is 7 million) words in the U.S. Tax Code (laws and regulations).
• There were 402 tax forms in 1990, by 2002 that number jumped to a staggering 526.
• The number of pages in the tax code and regulations went from 26,300 in 1984 to an astonishing 54,846 in 2003. There are 500 pages in a ream (standard package) of paper–that’s nearly 110 reams of paper! A ream is about two inces thick, so if you stacked all 54,846 pages on top of each other, you would have a stack of paper 220 inches high, or about 18 feet tall!!
• The IRS sends out over 8 billion pages in forms and instructions every single year, that’s nearly 300,000 trees. (Thankfully, they now use recycled paper).
• The easiest form, the 1040EZ, has 33 pages of instructions–ridiculous.

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Minimizing the Stress of a Layoff – Part 1 of 3

Layoffs are commonplace in a sagging economy, and chances are good that you know someone who has recently been laid-off from his or her job. And it often doesn’t matter how good you are at your job or how hard you work. But a layoff doesn’t have to be the end of the world, nor should it be. The key to minimizing the stress and negative fallout is to know how to react if you are laid-off and to prepare now for the possibility of a layoff in the future.

If you’ve been following this blog, you know we recently posted information about Utah County’s unemployment rate. Fortunately, the Provo/Orem Metro Area ranks 27th out of 372 other Metropolitan Areas in the U.S. according to February 2009 numbers–so it could be lots worse. Nevertheless, while 91.5% of the workers in the Provo and Orem areas are still employed, there are an increasing number of good, honest, hard-working people who want to work, but who do not have a job.

If you’ve been laid-off, have hope. You will survive to work another day if you’re determined to work. You may even find a way to embrace the layoff for what it may be–the opportunity to make a career change that you’ve been considering for a while.

We don’t know about you, but we’re tired of hearing about hope and seeing nothing done. It’s time for solutions. We’ll be posting information we think may be useful for anyone currently employed, anticipating a layoff, or who may have already been a casualty of downsizing.

Please leave us comments with ideas or helpful information you have that may help someone facing the stress of a layoff.

Minimizing the Stress of a Layoff – Part 3 of 3

Here are some additional ideas that may be useful to help reduce the stress of a layoff, or to prepare for the possibility of one in the future:

Be Wise with Your Emergency Fund – This assumes you have an emergency fund. If you don’t have one, start one. Cut back on discretionary purchases and put as much of your paycheck into your emergency savings fund as you can. If a layoff has already affected you, cut back or eliminate unnecessary expenditures and be wise with your use of the fund. Our “How much should I have in savings?” post can help you determine the right amount to put away. And the information in our “Automate Your Savings” post can help you save effortlessly. Hopefully, if you do get laid off, you’ll also have a severance package that will help you pay the bills. However, the more you can sock away, the more peace of mind you’ll have if the axe falls.

Communicate with Creditors and Billers – One of the major stresses after a layoff is making ends meet. The more willing you are to communicate openly and honestly with creditors and billers, the greater your chances are that they will work with you to help you meet your obligations. It’s not a guarantee, but you may be surprised by what they are willing to do to help you.

Remember to Look on the Bright Side — At worst, getting laid off is a temporary trial (and you will get through it, I promise). At best, your layoff may be the kick in the pants you need to find a more fulfilling job. It’s surprising how often I hear people speak of being thankful for their layoffs (some of them volunteered or even begged to be let go). Their severance packages gave them the time and opportunity to pursue the careers of their dreams. If you’ve been unhappy in your current career path, this layoff may be your chance to explore your options.

Know What Resources are Available — There are many resources available to help if you have already been let go. The Utah Department of Workforce Services has offices in American Fork, Provo, and Spanish Fork with professionals who can help. The Church of Jesus Christ of Latter-day Saints has Employment Resource Centers available to anyone, regardless of religious affiliation.

Tell Everyone You Know That You’re Looking for a Job – Now is not the time to be the strong, silent type. Ask for leads from family, friends, and neighbors. Sometimes it really is who you know, not what you know that leads to a meaningful job opportunity.

If you have ideas or helpful information that may help someone facing the stress of a layoff please leave us a comment.

“You want to do what?!?”

A recent discussion with my wife about our long-term retirement hopes was very revealing. The discussion went something like this:

Wife: “When you retire I think it would be fun to go to culinary school together and consider opening a restaurant. We have so much fun in the kitchen talking and cooking.”

Me: “Yeah. That would be fun. It would be a lot of work, but it would be fun. But what I would really like to do when I retire is be Donald Duck.”

Wife: “You want to do what?!?”

Me: “I want to be Donald Duck at Disneyland or Disney World. I think it would be fun seeing all those happy kids everyday. Don’t you?”

Wife: “I guess, weirdo. But wouldn’t it be easier and more fun being with me doing something we both enjoy?”

At that point I knew she had issued a checkmate, and I had best think about my plans more as our plans to stay out of trouble. It was also apparent that both ideas carried financial implications we have never discussed. Culinary school and funding a business are not cheap, nor is relocating to Anaheim or Orlando.

Consequently, a study from Fidelity Investments indicates this type of discussion is not entirely unusual. It finds we are not doing a very good job talking about our long-term financial goals with our significant others.

The study reports that only 45% of couples regularly discuss finances. And when it comes to retirement plans, 60% of couples don’t agree when they’ll retire, and 42% are like me and my wife–they don’t agree on what kind of life they’ll lead after they retire.

Does your significant other know your financial goals? Do you know his or hers?

What Really Matters?

When the stresses of life and work bog us down it’s easy to forget the things that really matter or are of the most value to us. Here are three things that I have been reminded of recently that may be of some value to you, too:

Relationships One of my peers recently reminded me that while we’re working hard to handle the pressures of the economy on the bank and the daily duties we face, that we can’t forget we have families and relationships to strengthen. As one blogger effectively said it: “The regular companionship and camaraderie of people you care about and share interests with is continually life-affirming. [Relationships] don’t revolve around the things you have or the activities you can afford – they revolve around people and shared experiences.”

Gratitude I find that the more I’m focused on the things I do have, rather than focusing on that which I do not, that I am more cheerful and giving. I become more positive in my thoughts and speech. I become more content to work harder to reach my goals. I have more purpose in my daily actions and interactions. Cicero said “Gratitude is not only the greatest of virtues, but the parent of all the others.”

Service Helen Keller said, “Happiness cannot come from without. It must come from within. It is not what we see and touch or that which others do for us which makes us happy; it is that which we think and feel and do, first for the other fellow and then for ourselves.” It is in the act of helping others that many receive a great deal of personal joy and satisfaction – something that cannot be replaced by any sort of material item.

What really matters to you? What do you value most?