Split (1)

train · 418k rows

query_id stringlengths 32 32	query stringlengths 6 5.38k	positive_passages listlengths 1 22	negative_passages listlengths 9 100	subset stringclasses 7 values
82e0da006e0ed803ec7fe11c6997908e	Am I eligible for a student maintenance loan?	[ { "docid": "a060d71b377cad147e3877d7f8d59d36", "text": "Looking at https://www.gov.uk/student-finance/who-qualifies, it says: You can only apply if: As you meet all three requirements I think you are counted as a English student in every respect. I would advise applying as soon as possible though to verify this. EDIT: also, getting a British passport anyway might not hurt; it makes sense as you've spent almost all your life here, and it would insulate you against any issues that might arise if Britain ends up leaving the EU.", "title": "" } ]	[ { "docid": "8700cf158da8042aaddd73f9043e4aef", "text": "\"This election only applies to payments that you make within 120 days of your having received loan money. These wouldn't be required payments, which is why they are called \"\"early\"\" payments. For example, let's say that you've just received $10,000 from your lender for a new loan. One month later, you pay $500 back. This election decides how that $500 will be applied. The first choice, \"\"Apply as Refund,\"\" means that you are essentially returning some of the money that you initially borrowed. It's like you never borrowed it. Instead of a $10,000 loan, it is now a $9,500 loan. The accrued interest will be recalculated for the new loan amount. The second choice, \"\"Apply as Payment,\"\" means that your payment will first be applied to any interest that has accrued, then applied to the principal. While you are in school, you don't need to make payments on student loans. However, interest is accruing from the day you get the money. This interest is simple interest, which means that the interest is only based on the loan principal; the interest is not compounding, and you are not paying interest on interest. After you leave school and your grace period expires, you enter repayment, and you have to start making payments. At this point, all the interest that has accrued from the time you first received the money until now is capitalized. This means that the interest is added to your loan principal, and interest will now be calculated on this new, larger amount. To avoid this, you can pay the interest as you go before it is capitalized, which will save you from having to pay even more interest later on. As to which method is better, just as they told you right on the form, the \"\"Apply as Refund\"\" method will save you the most money in the long run. However, as I said at the beginning, this election only applies if you make a payment within 120 days from receiving loan funds. Since you are already out of school and in repayment, I don't think it matters at all what you select here. For any students reading this and thinking about loans, I want to issue a warning. Student loans can ruin people later in life. If you truly feel that taking out a loan is the only way you'll be able to get the education you need, minimize these as much as possible. Borrow as little as possible, pay as much as you can as early as you can, and plan on knocking these out ASAP. Great Lakes has a few pages that discuss these topics:\"", "title": "" }, { "docid": "dc21ff450a0a0809f018f1758627b97f", "text": "\"Sometimes when you are trying to qualify for a loan, the lender will ask for proof of your account balances and costs. Your scheme here could be cause for some questions: \"\"why are you paying $20-30k to your credit card each month, is there a large debt you haven't disclosed?\"\". Or perhaps \"\"if you lost your job, would you be able to afford to continue to pay $20-30k\"\". Of course this isn't a real expense and you can stop whenever you want, but still as a lender I would want to understand this fully before loaning to someone who really does need to pay $20-30k per month. Who knows this might hiding some troublesome issues, like perhaps a side business is failing and you're trying to keep it afloat.\"", "title": "" }, { "docid": "6a29ceaf87d00765a91c3425175ea0ed", "text": "Of course, the situation for each student will vary widely so you'll have to dig deep on your own to know what is the best choice for your situation. Now that the disclaimer is out of the way, the best choice would be to use the Unsubsidized Stafford loan to finance graduate school if you need to resort to loans. The major benefits to the Unsubsidized Stafford are the following: You'll be forced to consider other loan types due to the Unsubsidized Stafford loan's established limits on how much you can borrow per year and in aggregate. The borrowing limits are also adjustable down by your institution. The PLUS loan is a fallback loan program designed to be your last resort. The program was created as a way for parents to borrow money for their college attending children when all other forms of financing have been exhausted. As a result you have the following major disadvantages to using the PLUS loan: You do have the bonus of being able to borrow up to 100% of your educational costs without any limits per year or in aggregate. The major benefit of keeping your loans in the Direct Loan program is predictability. Many private student loans are variable interest rate loans which can result in higher payments during the course of the loan. Private loans are also not eligible for government loan forgiveness programs, such as for working in a non-profit for 10 years.", "title": "" }, { "docid": "2e92dac5806716153cdccea6b4a15c79", "text": "I would consult a tax professional for specific help. On my own research, I believe that you could. I know that when I made payments when I was in school for my undergraduate, I made payments on the interest. I believe that I was even told by my financial aid office that I could deduct the interest that I paid. I made not much money so I wasn't anywhere close to the MAGI >75k, but I believe you still could. Not only that but one other thing to consider is that if you have an unsubisidized loan, the interest still accrues when you are in school. In that case, it might be better to make at least some payments. It would save you from the total loan amount ballooning so much while you are in school.", "title": "" }, { "docid": "e3ee988439f40ec0a196798f8437c0e5", "text": "a) Talk to the financial aid counselors at your school. There's a very good chance they have at least a partial solution for you. Let them know your dependency status has changed (if it has). I declared myself to be financially independent from my parents (I really was) and qualified for more aide. b) How much austerity are you willing to endure? I once spent two years eating beans & rice twice a day (lots of protein and other nutrients) while I worked full-time and went back to school to pursue a second degree part-time. I also shunned all forms of recreation (not even a movie) to save money (and so I could focus on staying current with assignments). During another period in my life, I gave up cable, cell-phone, land-line (and used Skype only), and avoided unnecessary use of my car, so I could clear a debt. You'd be amazed at how much you can squeeze from a budget if you're willing to endure austerity temporarily. c) Consider going to school part-time, taking as few as one course at a time if allowed. It's a lot easier to pay for one or two courses than to pay for 4 or 5. It may take longer, but at least you won't lose your credits and it won't take forever.", "title": "" }, { "docid": "22cca4bfe30f9fcfa88a8c97b373dea8", "text": "If you need a new roof because your house is full of buckets that fill up every rain :) then that's most likely the item at the top of the list. If you need a new roof because you don't like the color, I'd do something else with it. If you are in the US and the 'education loan' has the same caveats attached as your average student loan, I would eye that one with intent if the roof can soldier on for a few years as is. The simple reason for this is that a student loan would be the one debt that you list that you can never get rid off unless you actually pay it off, no matter what happens (IOW student loans aren't bankruptable). Disregard this if the caveats in the first sentence don't apply...", "title": "" }, { "docid": "6c55e69f31ac00b6f887ca455e189fdf", "text": "The definitive answer is: It Depends. What are your goals? First and foremost, you need to have at least 3 months expenses in cash or equivalent. (i.e. an investment that you can withdraw from quickly, and without penalty). The good news is that you don't have to come up with it instantly. Set a time frame - one year - for creating this safety net, and pay towards that goal. This is the single most important piece of financial advice you will receive. Now determine what you need to do. For example, you may need a car. Compare interest rates on your student loan and the car loan. Put your cash towards whichever is higher. If you don't need a car or other big ticket item, then you may consider sticking your surplus into the student loans. 50k at $1650 a month will be paid down in about 3 years, which might be a bit long to live the monastic lifestyle. I'd look at paying down the smallest loan first (assuming relatively similar rates), and freeing up that payment for yourself. So if you can pay off 1650 a month, and free up $100 of that in six months, then you can reward yourself with half that surplus, and apply the other half to the next loan. (This is different than some would suggest because you're talking about entering severe spartan mode, which is not sustainable.) Remember that life happens. You'll meet someone. You'll have an accident, your brother will get sick and you'll give him some money to help out. You've got to be prepared for these events, and for these reasons, I don't recommend living that close to the edge. Remember, you're not in default, and you do have the option of continuing to pay the minimum for a long time.", "title": "" }, { "docid": "5864aada4d3d22e846643eae10ba47fd", "text": "An education. A new car. Houses are made bigger so that's not really fair. An article on here previously mentioned someone paying for a dependable car and a small apartment, along with school tuition working part time as a dishwasher. Tuition at my closest state school (in state cost) is just under $9k per year. If you could only work 20 hours per week, amortized the school loan, payed $250 a month for an apartment with a roommate, $100 a month for utilities, $150 a month for groceries (all very difficult to achive and be healthy), you would have to make $15.35 an hour after taxes to do it without debt. This is assuming you don't have a car.", "title": "" }, { "docid": "5e68a7f16bbbafd367c5aa932c0fa551", "text": "The short answer is that you can use student loans for living expenses. Joe provides a nice taxonomy of loans. I would just add that some loans are not only guaranteed, but also subsidized. Essentially the Government buys down the rate of the loan. The mechanics are that a financial aid package might consist of grants, work study (job), subsidized, and guaranteed loans. One can turn down one or more of the elements of the package. All will be limited in some form. The work study will have a maximum number of hours and generally has low pay. Many find better deals working in the businesses surrounding the college or starting their own services type business. The grants rarely cover the full cost of tuition and books. The loans will both be limited in amount. It mainly depends on what you qualify for, and generally speaking the lower the income the more aid one qualifies for. Now some students use all their grant, all their loan money and buy things that are not necessary. For example are you going to live in the $450/month dorm, or the new fancy apartments that are running $800/month? Are you going to use the student loan money to buy a car? Will it be a new BMW or a 8 year old Camary? I see this first hand as I live near a large university. The pubs are filled with college students, not working, but drinking and eating every night. Many of them drive very fancy cars. The most onerous example of this is students at the military academies. Attendees have their books and tuition completely paid for. They also receive a stipend, and more money can be earned over the summer. They also all qualify for a 35K student loan in their junior year. Just about every kid, takes this loan. Most of those use the money to buy a car. I know a young lady who did exactly that, and so did many of her friends. So kids with a starting pay of 45K also start life with a 35K. Buying a nice car in the military is especially silly as they cannot drive it while deployed and they are very likely to be deployed. At least, however, they are guaranteed a starting job with a nice starting pay, and upward potential. College kids who behave similarly might not have it as good. Will they even find work? Will the job have the ability to move up? How much security is in the job? One might say that this does not apply to engineers and such, but I am working with a fellow with a computer science degree who cannot find a job and has not worked in the past 6 months. This even though the market is super hot right now for computer engineers. So, in a word, be very careful what you borrow.", "title": "" }, { "docid": "ad0028567b8dc2822bbcb30238ef587a", "text": "\"Concise answers to your questions: Depends on the loan and the bank; when you \"\"accelerate\"\" repayment of a loan by applying a pre-payment balance to the principal, your monthly payment may be reduced. However, standard practice for most loan types is that the repayment schedule will be accelerated; you'll pay no less each month, but you'll pay it off sooner. I can neither confirm nor deny that an internship counts as job experience in the field for the purpose of mortgage lending. It sounds logical, especially if it were a paid internship (in which case you'd just call it a \"\"job\"\"), but I can't be sure as I don't know of anyone who got a mortgage without accruing the necessary job experience post-graduation. A loan officer will be happy to talk to you and answer specific questions, but if you go in today, with no credit history (the student loan probably hasn't even entered repayment) and a lot of unknowns (an offer can be rescinded, for instance), you are virtually certain to be denied a mortgage. The bank is going to want evidence that you will make good on the debt you have over time. One $10,000 payment on the loan, though significant, is just one payment as far as your credit history (and credit score) is concerned. Now, a few more reality checks: $70k/yr is not what you'll be bringing home. As a single person without dependents, you'll be taxed at the highest possible withholdings rate. Your effective tax rate on $70k, depending on the state in which you live, can be as high as 30% (including all payroll/SS taxes, for a 1099 earner and/or an employee in a state with an income tax), so you're actually only bringing home 42k/yr, or about $1,600/paycheck if you're paid biweekly. To that, add a decent chunk for your group healthcare plan (which, as of 2014, you will be required to buy, or else pay another $2500 - effectively another 3% of gross earnings - in taxes). And even now with your first job, you should be at least trying to save up a decent chunk o' change in a 401k or IRA as a retirement nest egg. That student loan, beginning about 6 months after you leave school, will cost you about $555/mo in monthly payments for the next 10 years (if it's all Stafford loans with a 50/50 split between sub/unsub; that could be as much as $600/mo for all-unsub Stafford, or $700 or more for private loans). If you were going to pay all that back in two years, you're looking at paying a ballpark of $2500/mo leaving just $700 to pay all your bills and expenses each month. With a 3-year payoff plan, you're turning around one of your two paychecks every month to the student loan servicer, which for a bachelor is doable but still rather tight. Your mortgage payment isn't the only payment you will make on your house. If you get an FHA loan with 3.5% down, the lender will demand PMI. The city/county will likely levy a property tax on the assessed value of land and building. The lender may require that you purchase home insurance with minimum acceptable coverage limits and deductibles. All of these will be paid into escrow accounts, managed by your lending bank, from a single check you send them monthly. I pay all of these, in a state (Texas) that gets its primary income from sales and property tax instead of income, and my monthly payment isn't quite double the simple P&I. Once you have the house, you'll want to fill the house. Nice bed: probably $1500 between mattress and frame for a nice big queen you can stretch out on (and have lady friends over). Nice couch: $1000. TV: call it $500. That's probably the bare minimum you'll want to buy to replace what you lived through college with (you'll have somewhere to eat and sleep other than the floor of your new home), and we're already talking almost a month's salary, or payments of up to 10% of your monthly take-home pay over a year on a couple of store credit cards. Plates, cookware, etc just keeps bumping this up. Yes, they're (theoretically) all one-time costs, but they're things you need, and things you may not have if you've been living in dorms and eating in dining halls all through college. The house you buy now is likely to be a \"\"starter\"\", maybe 3bed/2bath and 1600 sqft at the upper end (they sell em as small as 2bd/1bt 1100sqft). It will support a spouse and 2 kids, but by that point you'll be bursting at the seams. What happens if your future spouse had the same idea of buying a house early while rates were low? The cost of buying a house may be as little as 3.5% down and a few hundred more in advance escrow and a couple other fees the seller can't pay for you. The cost of selling the same house is likely to include all the costs you made the seller pay when you bought it, because you'll be selling to someone in the same position you're in now. I didn't know it at the time I bought my house, but I paid about $5,000 to get into it (3.5% down and 6 months' escrow up front), while the sellers paid over $10,000 to get out (the owner got married to another homeowner, and they ended up selling both houses to move out of town; I don't even know what kind of bath they took on the house we weren't involved with). I graduated in 2005. I didn't buy my first house until I was married and pretty much well-settled, in 2011 (and yes, we were looking because mortgage rates were at rock bottom). We really lucked out in terms of a home that, if we want to or have to, we can live in for the rest of our lives (only 1700sqft, but it's officially a 4/2 with a spare room, and a downstairs master suite and nursery/office, so when we're old and decrepit we can pretty much live downstairs). I would seriously recommend that you do the same, even if by doing so you miss out on the absolute best interest rates. Last example: let's say, hypothetically, that you bite at current interest rates, and lock in a rate just above prime at 4%, 3.5% down, seller pays closing, but then in two years you get married, change jobs and have to move. Let's further suppose an alternate reality in which, after two years of living in an apartment, all the same life changes happen and you are now shopping for your first house having been pre-approved at 5%. That one percentage point savings by buying now, on a house in the $200k range, is worth about $120/mo or about $1440/yr off of your P&I payment ($921.42 on a $200,000 home with a 30-year term). Not chump change (over 30 years if you had been that lucky, it's $43000), but it's less than 5% of your take-home pay (month-to-month or annually). However, when you move in two years, the buyer's probably going to want the same deal you got - seller pays closing - because that's the market level you bought in to (low-priced starters for first-time homebuyers). That's a 3% commission for both agents, 1% origination, 0.5%-1% guarantor, and various fixed fees (title etc). Assuming the value of the house hasn't changed, let's call total selling costs 8% of the house value of $200k (which is probably low); that's $16,000 in seller's costs. Again, assuming home value didn't change and that you got an FHA loan requiring only 3.5% down, your down payment ($7k) plus principal paid (about another $7k; 6936.27 to be exact) only covers $14k of those costs. You're now in the hole $2,000, and you still have to come up with your next home's down payment. With all other things being equal, in order to get back to where you were in net worth terms before you bought the house (meaning $7,000 cash in the bank after selling it), you would need to stay in the house for 4 and a half years to accumulate the $16,000 in equity through principal payments. That leaves you with your original $7,000 down payment returned to you in cash, and you're even in accounting terms (which means in finance terms you're behind; that $7,000 invested at 3% historical average rate of inflation would have earned you about $800 in those four years, meaning you need to stick around about 5.5 years before you \"\"break even\"\" in TVM terms). For this reason, I would say that you should be very cautious when buying your first home; it may very well be the last one you'll ever buy. Whether that's because you made good choices or bad is up to you.\"", "title": "" }, { "docid": "c9c3931d827a94de24d9b700f3424857", "text": "I'm 40 and been carrying student debt for nearly 20 years. Because of life events and various circumstances I've had to defer several times. This means my balance history looks like a rollercoaster. At this point I just consider the Department of Education to be akin to heroin addiction. I feed it as regularly as I can. It starts to get painful when I can't. It requires an ever increasing amount to get that fix. I'm financially fucked and it's my fault. And one day it'll probably kill me. But I just keep trying. What choice do I have?", "title": "" }, { "docid": "ad4d2d9c3b94825c000b340d06134c64", "text": "I would not advise you to go entirely broke in order to clear debts. You could use the cash you have to invest, or render some other services other students need in school while you raise cash from doing so.", "title": "" }, { "docid": "2fb2f58dbd04dbe88f23a6ab7b8993b0", "text": "\"I'd check the terms of the student loan. It's been a long time since I had a student loan, but when I did it had restrictions that it could only be used for educational expenses, which they pretty clear spelled out meant tuition, books, lab fees, I think some provision for living expenses. If your student loan is subsidized by the government, they're not going to let you use it to start a business or go on vacation ... nor are they likely to let you invest it. Even if it is legal and within the terms of the contract, borrowing money to invest is very risky. What if you invest in the stock market, and then the stock market goes down? You may find you don't have the money to make the payments on the loan. People do this sort of thing all the time -- that's what \"\"buying on margin\"\" is all about. And some of them lose a bundle and get in real trouble.\"", "title": "" }, { "docid": "00b6bde49e1b1a7faf3b2b014491a62f", "text": "I got a credit card as a student with no income, not even a part time job. They called me, I agreed to one thing and they did another and now I have an old credit history. They don't do this anymore. But technically, student loan debt is unsecured?", "title": "" }, { "docid": "69100a1275675a01cd3378b1156f262a", "text": "Does that justify the purpose? That is for individual Banks to decide. No bank would pay for daily expenditure if you are saying primary salary you are spending on eduction. So your declaration is right. You are looking at funding your eduction via loan and you are earning enough for living and paying of the loan. I noticed that a lot of lenders do not lend to applicants whose purpose is to finance the tuition for post-secondary education This could be because the lenders have seen larger percentage defaults when people opt for such loans. It could be due to mix of factors like the the drag this would cause to an individual who may not benefit enough in terms of higher salary to repay the loan, or moves out of country getting a better job. If it is education loan, have you looked at getting scholarships or student loans.", "title": "" } ]	fiqa
f5ceab1fee3987b7b1a218e3df244864	Possible pro-rated division of asset strategies without a prenup?	[ { "docid": "be5bf2ec0a57e5f315ad4e2f1ba5a891", "text": "\"Absent a pre-nup, it's a case of \"\"lawyer vs lawyer,\"\" you can't count on protecting what you came into the marriage with. In theory, what you propose sounds fair, but the reality of divorce is that everything is fair game. much depends on each spouse's earnings and impact of child-raising. For example, a woman who gives up time in a career may go after more than half, as she may be X years behind in her career path due to the choices made to stay home with the kids. I think each divorce is unique, not cookie cutter.\"", "title": "" } ]	[ { "docid": "af0b1df1287ed9403409abff8d5d9e1c", "text": "Wow! First, congratulations! You are both making great money. You should be able to reach your goals. Are we on the right track ? Are we doing any mistakes which we could have avoided ? Please advice if there is something that we should focus more into ! I would prioritize as follows: Get on the same page. My first red flag is that you are listing your assets separately. You and your wife own property together and are raising your daughter together. The first thing is to both be on the same page with your combined income and assets. This is critical. Set specific goals for the future. Dreaming and big-picture life planning will be the foundation for building a detailed plan for reaching your goals. You will see more progress with more sacrifice. If you both are not equally excited about the goals, you will not both be equally willing to sacrifice lifestyle now. You have the income now to be able to set yourselves up to do whatever you want in 10 years, if you can agree on what you want. Hire a financial planner you trust. Interview people, ask someone who is where you want to be in 10 years. You need someone with experience that can guide you through these questions and understands how to manage your income stream. Start saving for retirement in tax-advantaged accounts. This should be as much as 10%-15% of your income combined, so $30k-$45k per year. You need to start diversifying your investments. Real estate is great, but I would never recommend it as this large a percentage of net worth. Start saving for your child's education. Hard to say what you need here, since I don't know your goals. A financial planner should assist you with this. Get rid of your debt. Out of your $2.1M of rental real estate and land, you have $1.4M of debt. It will be difficult to start a business with that much additional debt. It will also put stress on your retirement that you don't need. You are taking on lots of risk here. I would sell all but maybe one of the properties and let it cash flow. This will free up cash to start investing for retirement or future business too. Buy more rental in the future with cash only. You have plenty of income to do it this way, and you will be setting yourself up for a great future. At this point you can continue to pile funds into any/all your investments, with the goal of using the funds to start a business or to live on. If all your investments are tied up in real estate, you wont have anything to draw on if needed for a business opportunity. You need to weigh this out in your goal and planning. What should we do to prepare for a comfortable retirement and safety You cannot plan for or see all scenarios. However, good planning will give you more options and more choices. Investing driven by fear will set you up for failure. Spend less than you make. Be patient. Be generous. Cheers!", "title": "" }, { "docid": "0d43b31026ce05779c40b8f90373cf9c", "text": "I think your getting at the fact that 50% of marriages end in divorce, but I don't think that means it's 50/50 for every relationship. I haven't seen the numbers but I'd bet there's trends related to wealth, prior home life, etc.", "title": "" }, { "docid": "a452388558c5efe9cfa6b7e1088836e9", "text": "\"Give me your money. I will invest it as I see fit. A year later I will return the capital to you, plus half of any profits or losses. This means that if your capital under my management ends up turning a profit, I will keep half of those profits, but if I lose you money, I will cover half those losses. Think about incentives. If you wanted an investment where your losses were only half as bad, but your gains were only half as good, then you could just invest half your assets in a risk-free investment. So if you want this hypothetical instrument because you want a different risk profile, you don't actually need anything new to get it. And what does the fund manager get out of this arrangement? She doesn't get anything you don't: she just gets half your gains, most of which she needs to set aside to be able to pay half your losses. The discrepancy between the gains and losses she gets to keep, which is exactly equal to your gain or loss. She could just invest her own money to get the same thing. But wait -- the fund manager didn't need to provide any capital. She got to play with your money (for free!) and keep half the profits. Not a bad deal, for her, perhaps... Here's the problem: No one cares about your thousands of dollars. The costs of dealing with you: accounting for your share, talking to you on the phone, legal expenses when you get angry, the paperwork when you need to make a withdrawal for some dental work, mailing statements and so on will exceed the returns that could be earned with your thousands of dollars. And then the SEC would probably get involved with all kinds of regulations so you, with your humble means and limited experience, isn't constantly getting screwed over by the big fund. Complying with the SEC is going to cost the fund manager something. The fund manager would have to charge a small \"\"administrative fee\"\" to make it worthwhile. And that's called a mutual fund. But if you have millions of free capital willing to give out, people take notice. Is there an instrument where a bunch of people give a manager capital for free, and then the investors and the manager share in the gains and losses? Yes, hedge funds! And this is why only the rich and powerful can participate in them: only they have enough capital to make this arrangement beneficial for the fund manager.\"", "title": "" }, { "docid": "671a7c03188d20ca748faab01b5e0b28", "text": "Asset protection is broad subject. In your examples it is certainly possible to have accounts that exist undisclosed from a spouse and legally inaccessible by said spouse. In the US, balances in 401k retirement accounts are exempt from forfeitures in bankruptcy. The only trick to secret stashes is that it involves you having any wealth in the first place, that you don't need to access. It is more worth it, for most people, to use all of their access to wealth to get out of debt, earn claims to property, and save for retirement. This takes up all of their earnings, making hidden wealth of any significant portion to be an impractical pipe dream. But with trust laws, corporate laws, and marriage property laws being different in practically every jurisdiction, there is plenty of flexibility to construct the form of your secret wealth. Cryptocurrency makes it much easier, at the expense of net asset value volatility.", "title": "" }, { "docid": "c6afc08aa2ccb47a510e4af39c642a8d", "text": "Fidelity recently had an article on their website about deferred annuities (variable and fixed) that don't have the contribution limitations of an IRA, are a tax-deferred investment, and can be turned into a future income stream. I just started investigating this for myself. DISCLAIMER: I'm not a financial professional, and would suggest that you consult with a fee-only planner and tax advisor before making any decision.", "title": "" }, { "docid": "f0e42866e18ab51395e88ba021614b7d", "text": "I'm not going to speculate on the nature of your relationship with your wife, but the fact that you are worried about what would happen in the event of a divorce is a bit concerning. Presumably you married her with the intent of staying together forever, so what's the big deal if you spend 50k upgrading the house you live in, assuming you won't get divorced? Now, if you really are worried about something happening in the future, you might want to seek legal advice about the content of the prenup. I am guessing if the 400k were your assets before marriage, you have full claim to that amount in the event of a divorce. If you document the loan, or make some agreement, I would think you would have claim to at least some of the house's appreciation due to the renovations if they were made with your money. obligatgory IANAL", "title": "" }, { "docid": "a2c8cb46019e0553b262d0e0e3d9557d", "text": "\"You are not allowed to take a retirement account and move it into the beneficiary's name, an inherited IRA is titled as \"\"Deceased Name for the benefit of Beneficiary name\"\". Breaking the correct titling makes the entire account non-retirement and tax is due on the funds that were not yet taxed. If I am mistaken and titling remained correct, RMDs are not avoidable, they are taken based on your Wife's life expectancy from a table in Pub 590, and the divisor is reduced by one each year. Page 86 is \"\"table 1\"\" and provides the divisor to use. For example, at age 50, your wife's divisor is 34.2 (or 2.924%). Each year it decrements by 1, you do not go back to the table each year. It sounds like the seller's recommendation bordered on misconduct, and the firm behind him can be made to release you from this and refund the likely high fees he took from you. Without more details, it's tough to say. I wish you well. The only beneficiary that just takes possession into his/her own account is the surviving spouse. Others have to do what I first described.\"", "title": "" }, { "docid": "363c2829224280e5295cefae7404911e", "text": "In the US, illegal. Giving free investment advice (opinions) is really hard to get arrested for. Might lose you a friend, but nothing that would get cross-wise with the Securities and Exchange Commission. That said, I would never put those opinions in writing.", "title": "" }, { "docid": "e968810a7e746ad9c1f0ec0096e1adf5", "text": "\"For one thing fund managers, even fund management companies, own less money than their clients put together. On the whole they simply cannot underwrite 50% of the potential losses of the funds they manage, and an offer to do so would be completely unsecured. Warren Buffet owns about 1/3 of Berkshire Hathaway, so I suppose maybe he could do it if he wanted to, and I won't guess why he prefers his own business model (investing in the fund he manages, or used to manage) over the one you propose for him (keeping his money in something so secure he could use it to cover arbitrary losses on B-H). Buffett and his investors have always felt that he has sufficient incentive to see B-H do well, and it's not clear that your scheme would provide him any useful further incentive. You say that the details are immaterial. Supposing instead of 50% it was 0.0001%, one part in a million. Then it would be completely plausible for a fund manager to offer this: \"\"invest 50 million, lose it all, and I'll buy dinner to apologise\"\". But would you be as attracted to it as you would be to 50%? Then the details are material. Actually a fund manager could do it by taking your money, putting 50% into the fund and 50% into a cash account. If you make money on the fund, you only make half as much as if you'd been fully invested, so half your profit has been \"\"taken\"\" when you get back the fund value + cash. If you lose money on the fund, pay you back 50% of your losses using the cash. Worst case scenario[], the fund is completely wiped out but you still get back 50% of your initial investment. The combined fund+cash investment vehicle has covered exactly half your losses and it subtracts exactly half your profit. The manager has offered the terms you asked for (-50% leverage) but still doesn't have skin the game. Your proposed terms do not provide the incentive you expect. Why don't fund managers offer this? Because with a few exceptions 50% is an absurd amount for an investment fund to keep in cash, and nobody would buy it. If you want to use cash for that level of inverse leverage you call the bank, open an account, and keep the interest for yourself. You don't expect your managed fund to do it. Furthermore, supposing the manager did invest 100% of your subscription in the fund and cover the risk with their own capital, that means the only place they actually make any profit is the return on a risk that they take with their capital on the fund's wins/losses. You've given them no incentive to invest your money as well as their own: they might as well just put their capital in the fund and let you keep your money. They're better off without you since there's less paperwork, and they can invest whatever they like instead of carefully matching whatever money you send them. If you think they can make better picks than you, and you want them to do so on your behalf, then you need to pay them for the privilege. Riding their coattails for free is not a service they have any reason to offer you. It turns out that you cannot force someone to expose themselves to a particular risk other than by agreeing that they will expose themselves to that risk and then closely monitoring their investment portfolio. Otherwise they can find ways to insure/hedge the risk they're required to take on. If it's on their books but cancelled by something else then they aren't really exposed. So to provide incentive what we normally want is what Buffett does, which is for the fund manager to be invested in the fund to keep them keen, and to draw a salary in return for letting you in[*]. Their investment cannot precisely match yours because the fund manager's capital doesn't precisely match your capital. It doesn't cover your losses because it's in the same fund, so if your money vanishes the fund manager loses too and has nothing to cover you with. But it does provide the incentive. [] All right, I admit it, worst case scenario there's a total banking collapse, end of civilization as we know it, and the cash account defaults. But then even in your proposed scheme it's possible that whatever assets the fund manager was using as security could fail to materialise. [*] So why, you might ask, do individual fund managers get bonuses in return for meeting fixed targets instead of only being part-paid in shares in their own fund whose value they can then maximise? I honestly don't know, but I suspect \"\"lots of reasons\"\". Probably the psychology of rewarding them for performance in a way that compares with other executive posts or professions they might take up instead of fund management. Probably the benefit to the fund itself, which wants to attract more clients, of beating certain benchmarks. Probably other things including, frankly, human error in setting their compensation packages.\"", "title": "" }, { "docid": "285b348c6ae5fc496027cc017783fe17", "text": "Yes. It's called executive hedging, and it's a lot more common than most people know. As long as it's properly disclosed and the decision is based on publicly available information, there's technically nothing wrong with it. Krispy Kreme, Enron, MCI, and ImClone are the most notable companies that had executives do it on a large scale, but almost every company has or had executives execute a complex form of hedging known as a prepaid variable forward (PVF). In a PVF, the executive gives his shares to an investment bank in exchange for a percentage of cash up front. The bank then uses the executive shares to hedge in both directions for them. This provides a proxy that technically isn't the executive that needs to disclose. There's talk about it needing to be more public at the SEC right now. http://www.sec.gov/news/statement/020915-ps-claa.html", "title": "" }, { "docid": "d618f155ef12b1224a787c896d6999c1", "text": "This is not what you normally get told, including by partners who were there at the time. What IPO were you referring to? Andersen Consulting / Accenture's IPO was some time after the split. Edit: spun off? It wasn't what you'd call a friendly split", "title": "" }, { "docid": "cd7909dfb416a7ee1c38b72553366581", "text": "That is not an effective strategy for hiding assets. If you own any stake in those corporations, the attorney can target that ownership interest. If you don't have any ownership interest in those companies, then you're just like any other American dealing with other companies - no one expects to get a judgment against their adversary's apartment complex.", "title": "" }, { "docid": "1569f93563ab208396b84015c60d687d", "text": " Absolutely agree with /u/IsAnAlpaca * You /must/ not agree to this without seeing his balance sheet. * That means assets and liabilities, but also ask for the last 12 months' cash flow * Inability or unwillingness to provide any of those things is a HUGE no-go red flag.", "title": "" }, { "docid": "919c215dc649a8d23306318f5a6a9451", "text": "Many partnership agreements include a shotgun clause: one person sets a price, the other can either buy at that price or sell at it. It's rather brutal. You can make offers that you know are less than the company is worth if you're sure the other person will have to take that money from you, say if you know they can't run the company without you. He has asked for $X to be bought out, and failing that he would like to keep owning his half and send his wife (who may very well be competent, but who among other things has a very ill husband to deal with) to take his place. If he can occasionally contribute to the overall vision, and she can do the day to day, then keeping things as they are may be the smart move. But if that's not possible, it doesn't mean you have to buy him out for twice what you think it's worth. In the absence of a partnership agreement, it's going to be hard to know what to do. But one approach might be to pretend there is a shotgun clause. Ask him, if he thinks half the company is worth $X, if he's willing to buy you out for that price and have his wife run it without you. He is likely to blurt out that it isn't worth that and she can't do that. And at that point, you'll actually be negotiating.", "title": "" }, { "docid": "5a471ff2224383dc5a4b1d140d6501ee", "text": "The methodology for divisor changes is based on splits and composition changes. Dividends are ignored by the index. Side note - this is why, in my opinion, that any discussion of the Dow's change over a long term becomes meaningless. Ignoring even a 2% per year dividend has a significant impact over many decades. The divisor can be found at http://wsj.com/mdc/public/page/2_3022-djiahourly.html", "title": "" } ]	fiqa
de7dbbebb351fc9463ebcb645fa14307	Reinvesting earnings increases the book value of equity?	[ { "docid": "2b143acbcb0db499f15b967cf333ea82", "text": "The book value is Total Assets minus Total Liabilities and so if you increase the Total Assets without changing the Total Liabilities the difference gets bigger and thus higher. Consider if a company had total assets of $4 and total liabilities of $3 so the book value is $1. Now, if the company adds $2 to the assets, then the difference would be 4+2-3=6-3=3 and last time I checked 3 is greater than 1. On definitions, here are a couple of links to clarify that side of things. From Investopedia: Equity = Assets - Liabilities From Ready Ratios: Shareholders Equity = Total Assets – Total Liabilities OR Shareholders Equity = Share Capital + Retained Earnings – Treasury Shares Depending on what the reinvestment bought, there could be several possible outcomes. If the company bought assets that appreciated in value then that would increase the equity. If the company used that money to increase sales by expanding the marketing department then the future calculations could be a bit trickier and depend on what assumptions one wants to make really. If you need an example of the latter, imagine playing a game where I get to make up the rules and change them at will. Do you think you'd win at some point? It would depend on how I want the game to go and thus isn't something that you could definitively say one way or the other.", "title": "" } ]	[ { "docid": "c242c3c619edd67a2cb3f91a7f5277db", "text": "However what actually appears to happen is that the 100k is invested into the company to fund some growth plan. So is it actually the case that E's company is worth 400k only AFTER the transaction? Is the 100k added to the balance sheet as cash and would the other 300k be listed as an IP asset? The investor gets 25% of the shares of the company and pays $100k for them, so Owner's Equity increases by $100k, and the company gets $100k more in cash. The $400k number is an implicit calculation: if 25% of the company is worth $100k, 100% of the company is worth $400k. It's not on the books: the investor is just commenting that they feel that they are being over-charged.", "title": "" }, { "docid": "3fb7e228563796fa46d65b6918fe1cd1", "text": "I have heard that people say the greater earning means greater intrinsic value of the company. Then, the stock price is largely based on the intrinsic value. So increasing intrinsic value due to increasing earning will lead to increasing stock price. Does this make sense ? Yes though it may be worth dissecting portions here. As a company generates earnings, it has various choices for what it can do with that money. It can distribute some to shareholders in the form of dividends or re-invest to generate more earnings. What you're discussing in the first part is those earnings that could be used to increase the perceived value of the company. However, there can be more than a few interpretations of how to compute a company's intrinsic value and this is how one can have opinions ranging from companies being overvalued to undervalued overall. Of Mines, Forests, and Impatience would be an article giving examples that make things a bit more complex. Consider how would you evaluate a mine, a forest or a farm where each gives a different structure to the cash flow? This could be useful in running the numbers here.", "title": "" }, { "docid": "7aec2e5d1480a09c5e8c8671d32c6e8d", "text": "\"A bit strange but okay. The way I would think about this is again that you need to determine for what purpose you're computing this, in much the same way you would if you were to build out the model. The IPO valuation is not going to be relevant to the accretion/dilution analysis unless you're trying to determine whether the transaction was net accretive at exit. But that's a weird analysis to do. For longer holding periods like that you're more likely to look at IRR, not EPS. EPS is something investors look at over the short to medium term to get a sense of whether the company is making good acquisition decisions. And to do that short-to-medium term analysis, they look at earnings. Damodaran would say this is a shitty way of looking at things and that you should probably be looking at some measure of ROIC instead, and I tend to agree, but I don't get paid to think like an investor, I get paid to sell shit to them (if only in indirect fashion). The short answer to your question is that no, you should not incorporate what you are calling liquidation value when determining accretion/dilution, but only because the market typically computes accretion/dilution on a 3-year basis tops. I've never put together a book or seen a press release in my admittedly short time in finance that says \"\"the transaction is estimated to be X% accretive within 4 years\"\" - that just seems like an absurd timeline. Final point is just that from an accounting perspective, a gain on a sale of an asset is not going to get booked in either EBITDA or OCF, so just mechanically there's no way for the IPO value to flow into your accretion/dilution analysis there, even if you are looking at EBITDA/shares. You could figure the gain on sale into some kind of adjusted EBITDA/shares version of EPS, but this is neither something I've ever seen nor something that really makes sense in the context of using EPS as a standardized metric across the market. Typically we take OUT non-recurring shit in EPS, we don't add it in. Adding something like this in would be much more appropriate to measuring the success of an acquisition/investing vehicle like a private equity fund, not a standalone operating company that reports operational earnings in addition to cash flow from investing. And as I suggest above, that's an analysis for which the IRR metric is more ideally situated. And just a semantic thing - we typically wouldn't call the exit value a \"\"liquidation value\"\". That term is usually reserved for dissolution of a corporate entity and selling off its physical or intangible assets in piecemeal fashion (i.e. not accounting for operational synergies across the business). IPO value is actually just going to be a measure of market value of equity.\"", "title": "" }, { "docid": "c8b5c6c2466ff3fa1b44e11fd7d270ef", "text": "No, I think you are misunderstanding the Math. Stock splits are a way to control relatively where the price per share can be for a company as companies can split or reverse split shares which would be similar to taking dimes and giving 2 nickels for each dime, each is 10 cents but the number of coins has varied. This doesn't create any additional value since it is still 10 cents whether it is 1 dime or 2 nickels. Share repurchase programs though are done to prevent dilution as executives and those with incentive-stock options may get shares in the company that increase the number of outstanding shares that would be something to note.", "title": "" }, { "docid": "35ff05e2d5c742c8cf523afc69864cb9", "text": "Conservative = erring on the side of ascribing a higher EV to the business. Because if you're someone looking to acquire the business, for example, and let's say we're talking about a business that has debt which trades at a discount, it's more conservative to assume that the debt can't necessarily be restructured. To use an extreme example, as you're valuing the business, would it be conservative or aggressive to assume that the debt got magically wiped out altogether? So that's why I'm saying that it's more conservative to use the book value of the debt.", "title": "" }, { "docid": "695e0970638ca4d8e1098729232d4bfb", "text": "Expense accounts are closed into equity. Same with revenue. So an increase in an expense means lower equity (lower retained earnings since there is more expense). Ergo, decrease equity and increase a liability. Increase a liability since it was accrued, which is usually used specifically to refer to things that kind of just happen in the background. Aka the firm most likely didn't pay cash for that right then and there so increase a payable.", "title": "" }, { "docid": "7a4af6d5d949050b38d46a09f9238888", "text": "And the kind folk at Yahoo Finance came to the same conclusion. Keep in mind, book value for a company is like looking at my book value, all assets and liabilities, which is certainly important, but it ignores my earnings. BAC (Bank of America) has a book value of $20, but trades at $8. Some High Tech companies have negative book values, but are turning an ongoing profit, and trade for real money.", "title": "" }, { "docid": "fe9092bd89d9397b81899948937ce3bc", "text": "Shareholder's Equity consists of two main things: The initial capitalization of the company (when the shares were first sold, plus extra share issues) and retained earnings, which is the amount of money the company has made over and above capitalization, which has not been re-distributed back to shareholders. So yes, it is the firm's total equity financing-- the initial capitalization is the equity that was put into the company when it was founded plus subsequent increases in equity due to share issues, and retained earnings is the increase in equity that has occurred since then which has not yet been re-distributed to shareholders (though it belongs to them, as the residual claimants). Both accounts are credited when they increase, because they represent an increase in cash, that is debited, so in order to make credits = debits they must be credits. (It doesn't mean that the company has that much cash on hand, as the cash will likely be re-invested). Shareholder's Equity is neither an asset nor a liability: it is used to purchase assets and to reduce liabilities, and is simply a measure of assets minus liabilities that is necessary to make the accounting equation balance: Since the book value of stocks doesn't change that often (because it represents the price the company sold it for, not the current value on the stock market, and would therefore only change when there were new share issues), almost all changes in total assets or in total liabilities are reflected in Retained Earnings.", "title": "" }, { "docid": "eb8297b5ca140c0fb70085814539e5a3", "text": "The Gordon equation does not use inflation-adjusted numbers. It uses nominal returns/dividends and growth rates. It really says nothing anyone would not already know. Everyone knows that your total return equals the sum of the income return plus capital gains. Gordon simply assumes (perfectly validly) that capital gains will be driven by the growth of earnings, and that the dividends paid will likewise increase at the same rate. So he used the 'dividend growth rate' as a proxy for the 'earnings growth rate' or 'capital gains rate'. You cannot use inflation-removed estimates of equity rates of return because those returns do not change with inflation. If anything they move in opposite directions. Eg in the 1970's inflation the high market rates caused people to discount equity values at larger rates --- driving their values down -- creating losses.", "title": "" }, { "docid": "289270da721e0e136ede814135c932bf", "text": "\"Re. question 2 If I buy 20 shares every year, how do I get proper IRR? ... (I would have multiple purchase dates) Use the money-weighted return calculation: http://en.wikipedia.org/wiki/Rate_of_return#Internal_rate_of_return where t is the fraction of the time period and Ct is the cash flow at that time period. For the treatment of dividends, if they are reinvested then there should not be an external cash flow for the dividend. They are included in the final value and the return is termed \"\"total return\"\". If the dividends are taken in cash, the return based on the final value is \"\"net return\"\". The money-weighted return for question 2, with reinvested dividends, can be found by solving for r, the rate for the whole 431 day period, in the NPV summation. Now annualising And in Excel\"", "title": "" }, { "docid": "f2d553234eb9a1a22c924dadffeb7dbb", "text": "There are not always capital-efficient ways for a company to reinvest its own profits. This is why dividends exist. Imagine a company will reinvest 80% of its profits into a project with a huge projected return, but the other 20% of the company's profits cannot be reinvested efficiently because there are zero projects in which to reinvest the profits into that would return a better profit than what the company's shareholders could make by reinvesting those profits in their own way (ie: a benchmark market index like an S&P 500 index fund). Since the shareholders could make a better return with this than the company could with any company project, it would be irresponsible (technically maybe even illegal) for the company to reinvest that 20% of the profits. This reason for companies sometimes paying out profits to shareholders in the form of dividends is a market-efficient part of the economic system, and it really is great. If a CEO/CFO/anyone is paying out so much profit from a company that it is irresponsible to the company's investors, then that would also technically be illegal since the company is evading efficient project that would benefit its shareholders more than they could benefit themselves elsewhere in the market. (These legalities with shareholder laws are not explicitly put into action very often, but their effects are always there) It's also worth noting payout/plowback strategy is very important for the strategy and financing of a company, particularly for public investments.", "title": "" }, { "docid": "46209eafc0c865103c6e95b81c4e4564", "text": "I've spent enough time researching this question where I feel comfortable enough providing an answer. I'll start with the high level fundamentals and work my way down to the specific question that I had. So point #5 is really the starting point for my answer. We want to find companies that are investing their money. A good company should be reinvesting most of its excess assets so that it can make more money off of them. If a company has too much working capital, then it is not being efficiently reinvested. That explains why excess working capital can have a negative impact on Return on Capital. But what about the fact that current liabilities in excess of current assets has a positive impact on the Return on Capital calculation? That is a problem, period. If current liabilities exceed current assets then the company may have a hard time meeting their short term financial obligations. This could mean borrowing more money, or it could mean something worse - like bankruptcy. If the company borrows money, then it will have to repay it in the future at higher costs. This approach could be fine if the company can invest money at a rate of return exceeding the cost of their debt, but to favor debt in the Return on Capital calculation is wrong. That scenario would skew the metric. The company has to overcome this debt. Anyways, this is my understanding, as the amateur investor. My credibility is not even comparable to Greenblatt's credibility, so I have no business calling any part of his calculation wrong. But, in defense of my explanation, Greenblatt doesn't get into these gritty details so I don't know that he allowed current liabilities in excess of current assets to have a positive impact on his Return on Capital calculation.", "title": "" }, { "docid": "95bd051eec913747fac08c2007034758", "text": "\"Dividends can also be automatically reinvested in your stock holding through a DRIP plan (see the wikipedia link for further details, wiki_DRIP). Rather than receiving the dividend money, you \"\"buy\"\" additional stock shares your with dividend money. The value in the DRIP strategy is twofold. 1) your number of shares increases without paying transaction fees, 2) you increase the value of your holding by increasing number of shares. In the end, the RIO can be quite substantial due to the law of compounding interest (though here in the form of dividends). Talk with your broker (brokerage service provider) to enroll your dividend receiving stocks in a DRIP.\"", "title": "" }, { "docid": "bc8a62eba2e7e399e1295a6c80f1ee90", "text": "\"Since doodle77 handled arbitrage, I'll take goodwill. Goodwill is an accounting term that acts much like a \"\"plug\"\" account: you add/subtract to it the amount that makes everything balance. In the case of goodwill, it generally only applies to mergers & acquisitions. The theory (and justification) is this: firms buy other firms at prices other than the market price (usually higher), and it is assumed that this is because the acquirer values its acquisition more than other people do. But whether you use historical prices or market prices when you add (subtract) assets and liabilities to to (from) your balance sheet, this will never add up, because you paid more (less) than the assets are worth in the market, so more (less) cash flowed out than assets flowed in. The difference goes into the goodwill account, so firms with a large goodwill account are ones that have made lots of acquisitions.\"", "title": "" }, { "docid": "1adf6bf3b115f70cb8d77a0be6e30f97", "text": "\"Yes - this is exactly what it means. No losses (negative earnings). With today's accounting methods, you might want to determine whether you view earnings including or excluding extraordinary items. For example, a company might take a once-off charge to its earnings when revising the value of a major asset. This would show in the \"\"including\"\" but not in the \"\"excluding\"\" figure. The book actually has a nice discussion in Chapter 12 \"\"Things to Consider About Per-Share Earnings\"\" which considers several additional variables to consider here too. Note that this earnings metric is different from \"\"Stock Selection for the Defensive Investor\"\" which requires 10 years. PS - My edition (4th edition hardback) doesn't have 386 pages so your reference isn't correct for that edition. I found it on page 209 in Chapter 15 \"\"Stock Selection for the Enterprising Investor\"\".\"", "title": "" } ]	fiqa
fb53134d48471e777f78c11df2b78e22	Margin when entered into a derivative contract	[ { "docid": "3681fe7e8e5344a3021f0058d20ec485", "text": "\"A derivative contract can be an option, and you can take a short (sell) position , much the same way you would in a stock. When BUYING options you risk only the money you put in. However when selling naked(you don't have the securities or cash to cover all potential losses) options, you are borrowing. Brokers force you to maintain a required amount of cash called, a maintenance requirement. When selling naked calls - theoretically you are able to lose an INFINITE amount of money, so in order to sell this type of options you have to maintain a certain level of cash in your account. If you fail to maintain this level you will enter into whats often referred to as a \"\"margin-call\"\". And yes they will call your phone and tell you :). Your broker has the right to liquidate your positions in order to meet requirements. PS: From experience my broker has never liquidated any of my holdings, but then again I've never been in a margin call for longer then a few days and never with a severe amount. The margin requirement for investors is regulated and brokers follow these regulations.\"", "title": "" }, { "docid": "a9f4da035e090ae3d1bddb1e7939db2d", "text": "The most obvious use of a collateral is as a risk buffer. Just as when you borrow money to buy a house and the bank uses the house as a collateral, so when people borrow money to loan financial instruments (or as is more accurate, gain leverage) the lender keeps a percentage of that (or an equivalent instrument) as a collateral. In the event that the borrower falls short of margin requirements, brokers (in most cases) have the right to sell that collateral and mitigate the risk. Derivatives contracts, like any other financial instrument, come with their risks. And depending on their nature they may sometimes be much more riskier than their underlying instruments. For example, while a common stock's main risk comes from the movements in its price (which may itself result from many other macro/micro-economic factors), an option in that common stock faces risks from those factors plus the volatility of the stock's price. To cover this risk, lenders apply much higher haircuts when lending against these derivatives. In many cases, depending upon the notional exposure of the derivative, that actual dollar amount of the collateral may be more than the face value or the market value of the derivatives contract. Usually, this collateral is deposited not as the derivatives contract itself but rather as the underlying financial instrument (an equity in case of an option, a bond in case of a CDS, and so on). This allows the lender to offset the risk by executing a trade on that collateral itself.", "title": "" }, { "docid": "99ba8e9b3a8e247eec12203c5dccd25d", "text": "\"Derivatives derive their value from underlying assets. This is expressed by the obligation of at least one counterparty to trade with the other counterparty in the future. These can take on as many combinations as one can dream up as it is a matter of contract. For futures, where two parties are obligated to trade at a specific price at a specific date in the future (one buyer, one seller), if you \"\"short\"\" a future, you have entered into a contract to sell the underlying at the time specified. If the price of the future moves against you (goes up), you will have to sell at a loss. The bigger the move, the greater the loss. You go ahead and pay this as well as a little extra to be sure that you satisfy what you owe due to the future. This satisfaction is called margin. If there weren't margin, people could take huge losses on their derivative bets, not pay, and disrupt the markets. Making sure that the money that will trade is already there makes the markets run smoothly. It's the same for shorting stocks where you borrow the stock, sell it, and wait. You have to leave the money with the broker as well as deposit a little extra to be sure you can make good if the market moves to a large degree against you.\"", "title": "" } ]	[ { "docid": "ccda9ff7d29469ea162262ae51d604a9", "text": "A CFD broker will let you open a trade on margin as long as your account balance is more than the margin required on all your open trades. If the required margin increases within a certain percentage of your account balance, you will get a margin call. If you then don't deposit more funds or close losing trades out, the broker will close all your trades. Note: Your account balance is the remaining funds you have left to open new trades with. I always use stop loss orders with all my open trades, and because of this my broker reduces the amount of margin required on each trade. This allows me to have more open trades at the one time without increasing my funds. Effects of a Losing Trade on Margin Say I have an account balance of $2,000 and open a long trade in a share CFD of 1,000 CFDs with a share price of $10 and margin of 10%. The face value of the shares would be $10,000, but my initial margin would be $1,000 (10% of $10,000). If I don't place a stop loss and the price falls to $9, I would have lost $1,000 and my remaining margin would now be $900 (10% of $9,000). So I would have $100 balance remaining in my account. I would probably receive a margin call to deposit more funds in or close out my trade. If I don't respond the broker will close out my position before my balance gets to $0. If instead I placed a stop loss at say $9.50, my initial margin might be reduced to $500. As the price drops to $9.60 I would have lost $400 and my remaining margin would now only be $100, with my account balance at $1,500. When the price drops to $9.50 I will get stopped out, my trade will be closed and I would have lost $500, with my account balance still at $1,500. Effects of a Winning Trade on Margin Say I have the same account balance as before and open the same trade but this time the price moves up. If I don't place a stop loss and the price goes up to $11, I would have made a $1,000 profit and my remaining margin will now be $1,100 (10% of $11,000). So my account balance would now be $2,000 + $1,000 - $1,100 = $1,900. If I had placed a stop loss at say $9.50 again and the price moves up to $10.50, I would have made a profit of $500 and my margin would now be $1,000. My account balance would be $2,000 + $500 - $1,000 = $1,500. However, if after the price went up to $10.50 I also moved my stop loss up to $10, then I would have $500 profit and only $500 margin. So my balance in this case would be $2,000 + $500 - $500 = $2,000. So by using stop losses as part of your risk management you can reduce the margin used from your balance which will allow you to open more trades without any extra funds deposited into your account.", "title": "" }, { "docid": "1fb94e8d47ea5630d5154ec36535c97f", "text": "\"The margin money you put up to fund a short position ($6000 in the example given) is simply a \"\"good faith\"\" deposit that is required by the broker in order to show that you are acting in good faith and fully intend to meet any potential losses that may occur. This margin is normally called initial margin. It is not an accounting item, meaning it is not debited from you cash account. Rather, the broker simply segregates these funds so that you may not use them to fund other trading. When you settle your position these funds are released from segregation. In addition, there is a second type of margin, called variation margin, which must be maintained while holding a short position. The variation margin is simply the running profit or loss being incurred on the short position. In you example, if you sold 200 shares at $20 and the price went to $21, then your variation margin would be a debit of $200, while if the price went to $19, the variation margin would be a credit of $200. The variation margin will be netted with the initial margin to give the total margin requirement ($6000 in this example). Margin requirements are computed at the close of business on each trading day. If you are showing a loss of $200 on the variation margin, then you will be required to put up an additional $200 of margin money in order to maintain the $6000 margin requirement - ($6000 - $200 = $5800, so you must add $200 to maintain $6000). If you are showing a profit of $200, then $200 will be released from segregation - ($6000 + $200 = $6200, so $200 will be release from segregation leaving $6000 as required). When you settle your short position by buying back the shares, the margin monies will be release from segregation and the ledger postings to you cash account will be made according to whether you have made a profit or a loss. So if you made a loss of $200 on the trade, then your account will be debited for $200 plus any applicable commissions. If you made a profit of $200 on the trade then your account will be credited with $200 and debited with any applicable commissions.\"", "title": "" }, { "docid": "db92ce858b3591cf4d0933e4c1a1d624", "text": "\"No, it means that is only the notional value of that underlying asset of that contract, generally. The contract specification itself is listed on the exchange's websites, and there are really no assumptions you can make about a particular contract. Where S&P futures have one set of specifications, such as what it actually represents, how many each contract holds, how to price profits and losses... a different contract, such as FTSE 100 stock futures have a completely different set of specifications. Anyway in this one example the s&p 500 futures contract has an \"\"initial margin\"\" of $19,250, meaning that is how much it would cost you to establish that contract. Futures generally require delivery of 1,000 units of the underlying asset. So you would take the underlying asset's price and multiple it by 1,000. (what price you use is also mentioned in the contract specification), The S&P 500 index is $1588 you mentioned, so on Jun2013 you would have to delivery $1588 x 1000, or $1,588,000. GREAT NEWS, you only have to put up 1.2% in principal to control a 1.5 million dollar asset! Although, if even that amount is too great, you can look at the E-Mini S&P futures, which require about 1/10th the capital and delivery. This answer required that a lot of different subjects be mentioned, so feel free to ask a new question about the more specific topics.\"", "title": "" }, { "docid": "f3cd3ed069075fd5d61b92de73b50627", "text": "\"Scenario 1 - When you sell the shares in a margin account, you will see your buying power go up, but your \"\"amount available to withdraw\"\" stays the same until settlement. Yes, you can reallocate the same day, no need to wait until settlement. There is no margin interest for this scenario. Scenario 2 - If that stock is marginable to 50%, and all you have is $10,000 in that stock, you can buy another $10,000. Once done, you are at 50% margin, exactly.\"", "title": "" }, { "docid": "febf4114d614ef8371b4a237f32ce7e9", "text": "\"I'm smart enough to know that the answer to your questions is 'no'. There is no arbitrage scenario where you can trade currencies and be guaranteed a return. If there were, the thousands of PhD's and quants at hedge funds like DEShaw and Bridgewater would have already figured it out. You're basically trying to come up with a scenario that is risk free yet yields you better than market interest rates. Impossible. I'm not smart enough to know why, but my guess is that your statement \"\"I only need $2k margin\"\" is incorrect. You only need $2k as capital, but you are 'borrowing' on margin the other 98k and you'll need to pay interest on that borrowed amount, every day. You also run the risk of your investment turning sour and the trading firm requiring a higher margin.\"", "title": "" }, { "docid": "0a4079725f2d6fbf8f1f84c9048db43f", "text": "\"This chart concerns an option contract, not a stock. The method of analysis is to assume that the price of an option contract is normally distributed around some mean which is presumably the current price of the underlying asset. As the date of expiration of the contract gets closer the variation around the mean in the possible end price for the contract will decrease. Undoubtedly the publisher has measured typical deviations from the mean as a function of time until expiration from historical data. Based on this data, the program that computes the probability has the following inputs: (1) the mean (current asset price) (2) the time until expiration (3) the expected standard deviation based on (2) With this information the probability distribution that you see is generated (the green hump). This is a \"\"normal\"\" or Gaussian distribution. For a normal distribution the probability of a particular event is equal to the area under the curve to the right of the value line (in the example above the value chosen is 122.49). This area can be computed with the formula: This formula is called the probability density for x, where x is the value (122.49 in the example above). Tau (T) is the reciprocal of the variance (which can be computed from the standard deviation). Mu (μ) is the mean. The main assumption such a calculation makes is that the price of the asset will not change between now and the time of expiration. Obviously that is not true in most cases because the prices of stocks and bonds constantly fluctuate. A secondary assumption is that the distribution of the option price around the mean will a normal (or Gaussian) distribution. This is obviously a crude assumption and common sense would suggest it is not the most accurate distribution. In fact, various studies have shown that the Burr Distribution is actually a more accurate model for the distribution of option contract prices.\"", "title": "" }, { "docid": "5250b737e99d5c7bf0dcf6b4867a14db", "text": "Margin is when you borrow to buy stock. The margin % is the amount you can have borrowed over your own stock. There may also be some other considerations e.g. risk portfolio. Say you have 10,000. Your broker allows you buy on margin with a margin requirement of 100%. So You buy 18,000 of stock. You have 10k of your own and borrowed 8k to buy this. So you have 80% extra stock on margin. Say the stock has a downturn and loses 12% or so. Suddenly you have 16k stock value. But you still owe 8k. You are now at 100% margin. 8k is yours 8k is borrowed money. At this point if you drop anymore you are exceeding 100% margin and your broker may sell to ensure they get their 8k. The benefits of this are of course if the stock goes in your favor. 10% rise is 1,800 instead of 1,000.", "title": "" }, { "docid": "513e076455dc7595ae4eb802a5b8278f", "text": "\"Regardless of what the credit reporting agencies or brokerages say, the fact is that brokerage margin is not reported to the credit reporting agencies. I have \"\"borrowed\"\" hundreds of thousands of dollars on margin from dozens of brokerages over the years and have never seen a dime of it reported nor have I ever heard of it ever being reported for someone else. ...and it's easy to see why this would be so because \"\"borrowing\"\" on margin isn't really borrowing at all because you always must have positive equity in the account at all times. So you aren't borrowing anything, you just have an investment contract that determines your gains/losses as if you had borrowed (in other words, it's simulated).\"", "title": "" }, { "docid": "f17641cdf736100a78e0521fc4b00a67", "text": "\"I think the question, as worded, has some incorrect assumptions built into it, but let me try to hit the key answers that I think might help: Your broker can't really do anything here. Your broker doesn't own the calls you sold, and can't elect to exercise someone else's calls. Your broker can take action to liquidate positions when you are in margin calls, but the scenario you describe wouldn't generate them: If you are long stock, and short calls, the calls are covered, and have no margin requirement. The stock is the only collateral you need, and you can have the position on in a cash (non-margin) account. So, assuming you haven't bought other things on margin that have gone south and are generating calls, your broker has no right to do anything to you. If you're wondering about the \"\"other guy\"\", meaning the person who is long the calls that you are short, they are the one who can impact you, by exercising their right to buy the stock from you. In that scenario, you make $21, your maximum possible return (since you bought the stock at $100, collected $1 premium, and sold it for $120. But they usually won't do that before expiration, and they pretty definitely won't here. The reason they usually won't is that most options trade above their intrinsic value (the amount that they're in the money). In your example, the options aren't in the money at all. The stock is trading at 120, and the option gives the owner the right to buy at 120.* Put another way, exercising the option lets the owner buy the stock for the exact same price anyone with no options can in the market. So, if the call has any value whatsoever, exercising it is irrational; the owner would be better off selling the call and buying the stock in the market.\"", "title": "" }, { "docid": "9e767c26bb5156cea063ee0911642690", "text": "\"Yes. I heard back from a couple brokerages that gave detailed responses. Specifically: In a Margin account, there are no SEC trade settlement rules, which means there is no risk of any free ride violations. The SEC has a FAQ page on free-riding, which states that it applies specifically to cash accounts. This led me to dig up the text on Regulation T which gives the \"\"free-riding\"\" rule in §220.8(c), which is titled \"\"90 day freeze\"\". §220.8 is the section on cash accounts. Nothing in the sections on margin accounts mentions such a settlement restriction. From the Wikipedia page on Free Riding, the margin agreement implicitly covers settlement. \"\"Buying Power\"\" doesn't seem to be a Regulation T thing, but it's something that the brokerages that I've seen use to state how much purchasing power a client has. Given the response from the brokerage, above, and my reading of Regulation T and the relevant Wikipedia page, proceeds from the sale of any security in a margin account are available immediately for reinvestment. Settlement is covered implicitly by margin; i.e. it doesn't detract from buying power. Additionally, I have personally been making these types of trades over the last year. In a sub-$25K margin account, proceeds are immediately available. The only thing I still have to look out for is running into the day-trading rules.\"", "title": "" }, { "docid": "9b51e15974dd48332f992862cc5d6fab", "text": "\"I know some derivative markets work like this, so maybe similar with futures. A futures contract commits two parties to a buy/sell of the underlying securities, but with a futures contract you also create leverage because generally the margin you post on your futures contract is not sufficient to pay for the collateral in the underlying contract. The person buying the future is essentially \"\"borrowing\"\" money while the person selling the future is essentially \"\"lending\"\" money. The future you enter into is generally a short term contract, so a perfectly hedged lender of funds should expect to receive something that approaches the fed funds rate in the US. Today that would be essentially nothing.\"", "title": "" }, { "docid": "6ad39f83aacc8997b0def6e760c28763", "text": "You have to call Interactive Brokers for this. This is what you should do, they might even have a web chat. These are very broker specific idiosyncrasies, because although margin rules are standardized to an extent, when they start charging you for interest and giving you margin until settlement may not be standardized. I mean, I can call them and tell you what they said for the 100 rep.", "title": "" }, { "docid": "10fc3cef181d456bb37c2c3051b40413", "text": "\"people are willing to pay higher premiums for options when stocks go down. Obviously the time value and intrinsic value and interests rates of the option doesn't change because of this so the miscalculation remainder is priced into the implied volatility part of the formula. Basically, anything that suggests the stock price will get volatile (sharp moves in either direction) will increase the implied volatility of the option. For instance, around earnings reports, the IV in both calls and puts in the nearest expiration dates are very high. When stocks go down sharply, the volatility is high because some people are buying puts for protection and others are buying calls because they think there will be a rebound move in the other direction. People (the \"\"sleep-at-night\"\" investors, not the derivatives traders ;) ) tend to be calm when stocks are going up, and fearful when they are going down. The psychology is important to understand and observe and profit from, not to quantitatively prove. The first paragraph should be your qualitative answer\"", "title": "" }, { "docid": "8e5b49668a11791e783862ebec3cf636", "text": "The initial and overnight margin requirements are set by the exchanges (who calculate them using the Standard Portfolio of Analysis of Risk, or 'SPAN' system), and positions are market to market according to these at the end of the trading session. To find these margin requirements you will need to consult the website of the exchange on which the contract you are trading is issued (i.e. if you're trading on the London Metal Exchange it's no good looking at the Chicago Mercantile Exchange's margin requirements as a previous answer suggests!). However, for positions entered and exited within the same day, the daytrade margin rate will apply. This is set by your broker rather than the exchange, and can be as little as 10% of the exchange requirement. You can find a useful comparison of different margin types and requirements in the article I have published here: Understanding Margin for Futures Trading.", "title": "" }, { "docid": "1fd53ab98f3cf6dabfb19fa5362f4705", "text": "It may be helpful to have a few pitches prepared just in case.This is helpful because you may be articulating your groups investment thesis or even originating ideas at some point. * Company-Industry * Elevator pitch... * Why it's the best in the Peer group. * Why this pitch is novel. * Why the financials make sense. * Entry/Exit. * +s/-s.", "title": "" } ]	fiqa
e1423ce02445bdef73b18710965970b2	When I ask a broker to buy stock, what does the broker do?	[ { "docid": "5af089407e1ce10eb067713f60179f8b", "text": "Here are a couple of articles that can help highlight the differences between a broker and an online investment service, which seems to be part of the question that you're asking. Pay attention to the references at the end of this link. http://finance.zacks.com/online-investing-vs-personal-broker-6720.html Investopedia also highlights some of the costs and benefits of each side, broke and online investment services. http://www.investopedia.com/university/broker/ To directly answer your question, a broker may do anything from using a website to making a phone call to submitting some other form of documentation. It is unlikely that he is talking directly to someone on the trading floor, as the volume traded there is enormous.", "title": "" }, { "docid": "53195c2f4c71e1a5fc73004db6cb8383", "text": "You or the broker place an order to buy the share with the stock exchange. There has to be a matching sell order by someone. Once a match is made, you pay the money and get the share.", "title": "" }, { "docid": "7618f539a831ff550e87f916c911b7e6", "text": "\"My answer isn't a full one, but that's because I think the answer depends on, at minimum, the country your broker is in, the type of order you place (limit, market, algo, etc.,) and the size of your order. For example, I can tell from watching live rates on regular lot limit orders I place with my UK-based broker that they hold limit orders internally until they see a crossing rate on the exchange my requested stock is trading on, then they submit a limit order to that exchange. I only get filled from that one exchange and this happens noticeably after I see my limit price print, and my fills are always better than my limit price. Whereas with my US-based broker, I can see my regular lotsize limit order in the order book (depth of book data) prior to any fills. I will routinely be notified of a fill before I see the limit price print. And my fills come from any number of US exchanges (NYSE, ARCA, BATS, etc.) even for the same stock. I should point out that the \"\"NBBO\"\" rule in the US, under SEC regulation NMS, probably causes more complications in handling of market and limit orders than you're likely to find in most countries.\"", "title": "" } ]	[ { "docid": "c11fe5f13315fd4fb806ae0e7b291386", "text": "\"As far as I know, the answer to this is generally \"\"no.\"\" The closest thing would be to identify the stock transfer company representing the company that you want to hold and buy through them. (I have held this way, but I don't know if it's available on all stocks.) This eliminates the broker, but there's still a \"\"middle man\"\" in the transfer company. Note this section from the Stock transfer agent Wikipedia article: A public company usually only designates one company to transfer its stock. Stock transfer agents also run annual meetings as inspector of elections, proxy voting, and special meetings of shareholders. They are considered the official keeper of the corporate shareholder records. The decision to have a single transfer company is a practical one, ensuring that there is one entity responsible for recording this data - Hence even if you could buy stock \"\"directly\"\" from the company that you want to own, it would likely still get routed through the transfer company for recording.\"", "title": "" }, { "docid": "c2f5def027a81c2bd2a43665ac808a3c", "text": "It depends a large part on your broker's relationship with the issuing bank how early you can participate in the IPO round. But the nature of the stock market means the hotter the stock and the closer to the market (away from the issuing bank) you have to buy the higher the price you'll pay. The stock market is a secondary market, meaning the only things for sale are shares already owned by someone. As a result, for a hot stock the individual investor will have to wait for another investor (not the issuing bank) to trade (sell) the stock.", "title": "" }, { "docid": "9e1d0c6ec35cad5fe9aa6d894c55fef5", "text": "There are 2 main types of brokers, full service and online (or discount). Basically the full service can provide you with advice in the form of recommendations on what to buy and sell and when, you call them up when you want to put an order in and the commissions are usually higher. Whilst an online broker usually doesn't provide advice (unless you ask for it at a specified fee), you place your orders online through the brokers website or trading platform and the commissions are usually much lower. The best thing to do when starting off is to go to your country's stock exchange, for example, The ASX in Sydney Australia, and they should have a list of available brokers. Some of the online brokers may have a practice or simulation account you can practice on, and they usually provide good educational material to help you get started. If you went with an online broker and wanted to buy Facebook on the secondary market (that is on the stock exchange after the IPO closes), you would log onto your brokers website or platform and go to the orders section. You would place a new order to buy say 100 Facebook shares at a certain price. You can use a market order, meaning the order will be immediately executed at the current market price and you will own the shares, or a limit price order where you select a price below the current market price and wait for the price to come down and hit your limit price before your order is executed and you get your shares. There are other types of orders available with different brokers which you will learn about when you log onto their website. You also need to be careful that you have the funds available to pay for the share at settlement, which is 3 business days after your order was executed. Some brokers may require you to have the funds deposited into an account which is linked to your trading account with them. To sell your shares you do the same thing, except this time you choose a sell order instead of a buy order. It becomes quite simple once you have done it a couple of times. The best thing is to do some research and get started. Good Luck.", "title": "" }, { "docid": "88ddcb0c6858f21c6a4571c616e9ba94", "text": "\"When I have stock at my brokerage account, the title is in street name - the brokerage's name and the quantity I own is on the books of the brokerage (insured by SIPC, etc). The brokerage loans \"\"my\"\" shares to a short seller and is happy to facilitate trades in both directions for commissions (it's a nice trick to get other parties to hold the inventory while you reap income from the churn); by selecting the account I have I don't get to choose to not loan out the shares.\"", "title": "" }, { "docid": "93c0dd8ea161a1275c9113b1fd75a006", "text": "2 things may happen. Either your positions are closed by the broker and the loss or profit is credited to your account. Else it is carried over to the next day and you pay interest on the stocks lent to you. What happens will be decided by the agreement signed between you and your broker.", "title": "" }, { "docid": "29051a1f78e6280e783af10934bd5ac1", "text": "Purchases and sales from the same trade date will both settle on the same settlement date. They don't have to pay for their purchases until later either. Because HFT typically make many offsetting trades -- buying, selling, buying, selling, buying, selling, etc -- when the purchases and sales settle, the amount they pay for their purchases will roughly cancel with the amount they receive for their sales (the difference being their profit or loss). Margin accounts and just having extra cash around can increase their ability to have trades that do not perfectly offset. In practice, the HFT's broker will take a smaller amount of cash (e.g. $1 million) as a deposit of capital, and will then allow the HFT to trade a larger amount of stock value long or short (e.g. $10 million, for 10:1 leverage). That $1 million needs to be enough to cover the net profit/loss when the trades settle, and the broker will monitor this to ensure that deposit will be enough.", "title": "" }, { "docid": "de44418b1a4e0c4e0b86ac2e3c8cc274", "text": "\"During market hours, there are a lot of dealers offering to buy and sell all exchange traded stocks. Dealers don't actually care about the company's fundamentals and they set their prices purely based on order flow. If more people start to buy than sell, the dealer notices his inventory going down and starts upping the price (both his bid and ask). There are also traders who may not be \"\"dealers\"\", but are willing to sell if the price goes high enough or buy if the price goes low enough. This keeps the prices humming along smoothly. During normal trading hours, if you buy something and turn around and sell it two minutes later, you'll probably be losing a couple cents per share. Outside normal market hours, the dealers who continue to have a bid and ask listed know that they don't have access to good price information -- there isn't a liquid market of continuous buying and selling for the dealer to set prices he considers safe. So what does he do? He widens the spread. He doesn't know what the market will open tomorrow at and doesn't know if he'll be able to react quickly to news. So instead of bidding $34.48 and offering at $34.52, he'll move that out to $33 and $36. The dealer still makes money sometimes off this because maybe some trader realized that he has options expiring tomorrow, or a short position that he's going to get a margin call on, or some kind of event that pretty much forces him to trade. Or maybe he's just panicking and overreacting to some news. So why not trade after hours? Because there's no liquidity, and trading when there's no liquidity costs you a lot.\"", "title": "" }, { "docid": "b40e7ce58e2e0e0b42c64c825ceec17d", "text": "The traditional role of a stockbroker is to arrange for the buying and selling of stock by finding buyers and sellers at an agreed upon price. The broker does not purchase the stock for himself but merely arranges for the stock to be traded. A trader is one who purchases stock with the hope of selling it for a gain. The trader will use a broker to help with the purchase and sale of a stock.", "title": "" }, { "docid": "99bb25d0b743df906c2a541a30c45585", "text": "It is not your brokerage's responsibility to tell you what to buy, whether explicitly, or implicitly through their fee structure. This is not an article about Robin Hood. It's an argument condemning all active investing with repeated mostly-irrelevant mentions of Robin Hood as one of the hundreds of entities that makes that possible.", "title": "" }, { "docid": "bffdd2b0003ce358a8fc2bc569131763", "text": "\"Price is decided by what shares are offered at what prices and who blinks first. The buyer and seller are both trying to find the best offer, for their definition of best, within the constraints then have set on their bid or ask. The seller will sell to the highest bid they can get that they consider acceptable. The buyer will buy from the lowest offer they can get that they consider acceptable. The price -- and whether a sale/purchase happens at all -- depends on what other trades are still available and how long you're willing to wait for one you're happy with, and may be different on one share than another \"\"at the same time\"\" if the purchase couldn't be completed with the single best offer and had to buy from multiple offers. This may have been easier to understand in the days of open outcry pit trading, when you could see just how chaotic the process is... but it all boils down to a high-speed version of seeking the best deal in an old-fashioned marketplace where no prices are fixed and every sale requires (or at least offers the opportunity for) negotiation. \"\"Fred sells it five cents cheaper!\"\" \"\"Then why aren't you buying from him?\"\" \"\"He's out of stock.\"\" \"\"Well, when I don't have any, my price is ten cents cheaper.\"\" \"\"Maybe I won't buy today, or I'll buy elsewhere. \"\"Maybe I won't sell today. Or maybe someone else will pay my price. Sam looks interested...\"\" \"\"Ok, ok. I can offer two cents more.\"\" \"\"Three. Sam looks really interested.\"\" \"\"Two and a half, and throw in an apple for Susie.\"\" \"\"Done.\"\" And the next buyer or seller starts the whole process over again. Open outcry really is just a way of trying to shop around very, very, very fast, and electronic reconciliation speeds it up even more, but it's conceptually the same process -- either seller gets what they're asking, or they adjust and/or the buyer adjusts until they meet, or everyone agrees that there's no agreement and goes home.\"", "title": "" }, { "docid": "793b5be391b5c0601b8ea3ed19ca1fb5", "text": "\"I assume that mutual funds are being discussed here. As Bryce says, open-ended funds are bought from the mutual fund company and redeemed from the fund company. Except in very rare circumstances, they exist only as bits in the fund company's computers and not as share certificates (whether paper or electronic) that can be delivered from the selling broker to the buying broker on a stock exchange. Effectively, the fund company is the sole market maker: if you want to buy, ask the fund company at what price it will sell them to you (and it will tell you the answer only after 4 pm that day when a sale at that price is no longer possible unless you committed to buy, say, 100 shares and authorized the fund company to withdraw the correct amount from your bank account or other liquid asset after the price was known). Ditto if you want to sell: the mutual fund company will tell you what price it will give you only after 4 pm that day and you cannot sell at that price unless you had committed to accept whatever the company was going to give you for your shares (or had said \"\"Send me $1000 and sell as many shares of mine as are needed to give me proceeds of $1000 cash.\"\")\"", "title": "" }, { "docid": "71399cba538d2d34baf47cb9990fb45a", "text": "\"Also, in the next sentence, what is buyers commission? Is it referring to the share holder? Or potential share holder? And why does the buyer get commission? The buyer doesn't get a commission. The buyer pays a commission. So normally a buyer would say, \"\"I want to buy a hundred shares at $20.\"\" The broker would then charge the buyer a commission. Assuming 4%, the commission would be So the total cost to the buyer is $2080 and the seller receives $2000. The buyer paid a commission of $80 as the buyer's commission. In the case of an IPO, the seller often pays the commission. So the buyer might pay $2000 for a hundred shares which have a 7% commission. The brokering agent (or agents may share) pockets a commission of $140. Total paid to the seller is $1860. Some might argue that the buyer pays either way, as the seller receives money in the transaction. That's a reasonable outlook. A better way to say this might be that typical trades bill the buyer directly for commission while IPO purchases bill the seller. In the typical trade, the buyer negotiates the commission with the broker. In an IPO, the seller does (with the underwriter). Another issue with an IPO is that there are more parties getting commission than just one. As a general rule, you still call your broker to purchase the stock. The broker still expects a commission. But the IPO underwriter also expects a commission. So the 7% commission might be split between the IPO underwriter (works for the selling company) and the broker (works for the buyer). The broker has more work to do than normal. They have to put in the buyer's purchase request and manage the price negotiation. In most purchases, you just say something like \"\"I want to offer $20 a share\"\" or \"\"I want to purchase at the market price.\"\" In an IPO, they may increase the price, asking for $25 a share. And they may do that multiple times. Your broker has to come back to you each time and get a new authorization at the higher price. And you still might not get the number of shares that you requested. Beyond all this, you may still be better off buying an IPO than waiting until the next day. Sure, you pay more commission, but you also may be buying at a lower price. If the IPO price is $20 but the price climbs to $30, you would have been better off paying the IPO price even with the higher commission. However, if the IPO price is $20 and the price falls to $19.20, you'd be better off buying at $19.20 after the IPO. Even though in that case, you'd pay the 4% commission on top of the $19.20, so about $19.97. I think that the overall point of the passage is that the IPO underwriter makes the most money by convincing you to pay as high an IPO price as possible. And once they do that, they're out of the picture. Your broker will still be your broker later. So the IPO underwriter has a lot of incentive to encourage you to participate in the IPO instead of waiting until the next day. The broker doesn't care much either way. They want you to buy and sell something. The IPO or something else. They don't care much as to what. The underwriter may overprice the stock, as that maximizes their return. If they can convince enough people to overpay, they don't care that the stock falls the day after that. All their marketing effort is to try to achieve that result. They want you to believe that your $20 purchase will go up to $30 the next day. But it might not. These numbers may not be accurate. Obviously the $20 stock price is made up. But the 4% and 7% numbers may also be inaccurate. Modern online brokers are very competitive and may charge a flat fee rather than a percentage. The book may be giving you older numbers that were correct in 1983 (or whatever year). The buyer's commission could also be lower than 4%, as the seller also may be charged a commission. If each pays 2%, that's about 4% total but split between a buyer's commission and a seller's commission.\"", "title": "" }, { "docid": "84f19c18230b41f5cf0f9931dfe1fdd9", "text": "Off the top of my head, a broker: While there are stock exchanges that offer direct market access (DMA), they (nearly) always want a broker as well to back the first two points I made. In that case the broker merely routes your orders directly to the exchange and acts as a custodian, but of course the details heavily depend on the exchange you're talking about. This might give you some insight: Direct Market Access - London Stock Exchange", "title": "" }, { "docid": "45d30b6b15c3c64709ec89acf0a3ee0a", "text": "\"The correct answer to this question is: the person who the short sells the stock to. Here's why this is the case. Say we have A, who owns the stock and lends it to B, who then sells it short to C. After this the price drops and B buys the stock back from D and returns it to A. The outcome for A is neutral. Typically stock that is sold short must be held in a margin account; the broker can borrow the shares from A, collect interest from B, and A has no idea this is going on, because the shares are held in a street name (the brokerage's name) and not A. If A decides during this period to sell, the transaction will occur immediately, and the brokerage must shuffle things around so the shares can be delivered. If this is going to be difficult then the cost for borrowing shares becomes very high. The outcome for B is obviously a profit: they sold high first and bought (back) low afterwards. This leaves either C or D as having lost this money. Why isn't it D? One way of looking at this is that the profit to B comes from the difference in the price from selling to C and buying from D. D is sitting on the low end, and thus is not paying out the profit. D bought low, compared to C and this did not lose any money, so C is the only remaining choice. Another way of looking at it is that C actually \"\"lost\"\" all the money when purchasing the stock. After all, all the money went directly from C to B. In return, C got some stock with the hope that in the future C could sell it for more than was paid for it. But C literally gave the money to B, so how could anybody else \"\"pay\"\" the loss? Another way of looking at it is that C buys a stock which then decreases in value. C is thus now sitting on a loss. The fact that it is currently only a paper loss makes this less obvious; if the stock were to recover to the price C bought at, one might conclude that C did not lose the money to B. However, in this same scenario, D also makes money that C could have made had C bought at D's price, proving that C really did lose the money to B. The final way of seeing that the answer is C is to consider what happens when somebody sells a stock which they already hold but the price goes up; who did they lose out on the gain to? The person again is; who bought their stock. The person would buys the stock is always the person who the gain goes to when the price appreciates, or the loss comes out of if the price falls.\"", "title": "" }, { "docid": "b8da10c8337c08554e4582761a771d98", "text": "underwriters aren't subject to lock-up. They actually don't hold anything. They oversell at IPO, with their short position covered by the green shoe (an option from the company). If the deal does well, the underwriters exercise the green shoe to cover their short. If the deal runs into some pressure, they step in to support the price by buying back shares... thereby covering their short. So they are doing price support in the early days of a deal, but it is almost always paid for by the company granting them an option. But the underwriters aren't taking stock. Correct that typically all insiders and existing investors are expected to sign-up a lock-up.", "title": "" } ]	fiqa
5d55eb2c62365fe5045da3e84885f6b9	Where is “Cash Credit from Unsettled Activity” coming from?	[ { "docid": "2a2ff5a170f6667b54c358bf001ac5cf", "text": "\"The Cash Credit from Unsettled Activity occurs because AGG issued a dividend in the past week. Since you purchased the ETF long enough before the record date (June 5, 2013) for that trade to settle, you qualified for a dividend. The dividend distribution was $0.195217/share for each of your six shares, for a total credit of $1.17 = 6 * 0.195217. For any ETF, the company's website should tell you when dividends are issued, usually under a section titled \"\"Distributions\"\" or something similar. If you look in your Fidelity account's History page, it should show an entry of \"\"Dividend Received\"\", which confirms that the cash credit is coming from a dividend distribution. You could look up your holdings and see which one(s) recently issued a dividend; in this case, it was AGG.\"", "title": "" } ]	[ { "docid": "e8034a4cc4698ab17120162a58ee34d8", "text": "The Bank Secrecy Act of 1970 requires that banks assist the U.S. Gov't in identifying and preventing money laundering. This means they're required to keep records of cash transactions of Negotiable Instruments, and report any such transactions with a daily aggregate limit of a value greater than (or equal to?) $10,000. Because of this, the business which is issuing the money order is also required to record this transaction to report it to the bank, who then holds the records in case FinCEN wants to review the transactions. EDITED: Added clarification on the $10,000 rule", "title": "" }, { "docid": "10dbf897b0b810d26ab8139f75a24691", "text": "Gläubiger ID ungültig seems to indicate that the side trying to pull money from your account used a Gläuber-ID that has expired or has been revoked. (Just in case someone has the same question, two years later.)", "title": "" }, { "docid": "580d7128f24e08befbe78bf7c0f80f29", "text": "Essentially speaking, when you purchase goods worth $100 using your card, the store has to pay about $2 for the transaction to the company that operates that stores' credit card terminal. If you withdraw cash from an ATM, you might be charged a fee for such a transaction. However, the ATM operator doesn't pay the credit processor such a transaction fee - thus, it is classified as a cash transaction. Additionally, performing cash advances off a CC is a rather good indicator of a bad financial health of the user, which increase the risk of default, and in some institutions is a factor contributing to their internal creditworthiness assessment.", "title": "" }, { "docid": "597fbba980d57f15eb40096d787f787b", "text": "There's still a paper trail for every transaction. There's gotta be a debit and credit in there somewhere. Plus these companies are supposed to be audited by an independent auditor who, if they're worth their salt, should be able to track down every penny.", "title": "" }, { "docid": "a27715be676e47c2c991c5717c23bdfa", "text": "\"I'm not sure if this answer is going to win me many friends on reddit, but here goes... There's no good reason why they couldn't have just told him the current balance shown on their records, BUT... There are some good reasons why they can't quote a definitive \"\"payoff\"\" balance to instantly settle the account: It's very possible to charge something today, and not have it show up on Chase's records until tomorrow, or Monday, or later. There are still places that process paper credit-card transactions, or that deal with 3rd-party payment processors who reconcile transactions M-F, 9-5ish, and so on. - Most transactions these days are authorized the instant you swipe the card, and the merchant won't process until they get authorization back from the CC company. But sometimes those authorizations come from third-party processors who don't bill Chase until later. Some of them might not process a Friday afternoon transaction until close-of-business Monday. - Also, there are things like taxicab fares that might be collected when you exit the cab, but the record exists only in the taxi's onboard machine until they plug it into something else at the end of the shift. - There are still some situations (outdoor flea-markets, auctions, etc) where the merchant takes a paper imprint, and doesn't actually process the payment until they physically mail it in or whatever. - Some small businesses have information-security routines in place where only one person is allowed to process credit-card payments, but where multiple customer service reps are allowed to accept the CC info, write it down on one piece of paper, then either physically hand the paper to the person with processing rights, or deposit the paper in a locked office or mail-slot for later processing. This is obviously not an instant-update system for Chase. (Believe it or not, this system is actually considered to be more secure than retaining computerized records unless the business has very rigorous end-to-end info security). So... there are a bunch of legit reasons why a CC company can't necessarily tell you this instant that you only need to pay $x and no more to close the account (although there is no good reason why they shouldn't be able to quote your current balance). What happens when you \"\"close an account\"\" is basically that they stop accepting new charges that were made after your notification, but they will still accept and bill you for legit charges that you incurred before you gave them notice. So basically, they \"\"turn off\"\" the credit-card, but they can't guarantee how much you owe until the next billing cycle after this one closes: - You notify them to \"\"close\"\" the account. They stop authorizing new charges. - Their merchant agreements basically give the merchant a certain window to process charges. The CC company process legit charges that were made prior to \"\"closing\"\" the account. - The CC company sends you the final statement after that window for any charges has expired, - When that final statement is paid (or if it is zero), THAT is when the account is settled and reported to Equifax etc as \"\"paid\"\". So it's hard to tell from your post who was being overly semantic/unreasonable. If the CC company refused to tell the current balance, they were just being dickheads. But if they refused to promise that the current balance shown is enough to instantly settle the account forever, they had legit reasons. Hope that helps.\"", "title": "" }, { "docid": "b09177af85ced2610290bee3b451f080", "text": "I've seen an increasing number of writeups about this. Some peers think people just use more credit cards nowadays (instead of cash for instance), and that it's normal. I'm not buying it. I think this is a serious problem and I'm wondering how we're going to see this play into the US economy moving forward. Also, if anyone knows how the EU is doing with credit card debt, I'd be grateful for any data points.", "title": "" }, { "docid": "61fc5f4ac7043eed5900f5cb1c043e7d", "text": "Read your bill, question things that don't look familiar. People who steal credit card numbers don't bother to conceal themselves well. So if you live in Florida, and all of the sudden charges appear in Idaho, you should investigate. Keeping charge slips seems counter-productive to me. I already know that I bought gasoline from the station down the street, a slip of paper whose date may or may not align with the credit card bill is not very useful. The half-life for a stolen card is hours. So you tend to see a bunch of charges appearing quickly. If someone is stealing $20 a week from you over an extended period of time, the theif is probably someone you live or work with, and paper slips won't help you there either.", "title": "" }, { "docid": "f5827ececad5a61f0f7966888a3a9d00", "text": "\"You state \"\"Any info will be appreciated\"\", so here's some background information on my answer (you can skip to my answer): When I worked for banks, I was required to submit suspicious activity to the people above me by filling out a form with a customer's name, SSN, account number(s) and ID. You may hear in media that it is $10K or sometimes $5K. The truth is that it could be lower than that, depending on what the institution defines as suspicious. Every year we were required to take a \"\"course\"\" which implied that terrorists and criminals use cash regularly - whether we agree or disagree is irrelevant - this is what the course implied. It's important to understand that many people use cash-only budgets because it's easier than relying on the banking system which charges overdraft fees for going over, or in some cases, you pay more at merchants because of card usage (some merchants give discounts for cash). If someone has a budget of $10K a month and they choose to use cash, that's perfectly fine. Also, why is it anyone's business what someone does with their private property? This created an interesting contrast among differently aged Americans - older Americans saw the banking system as tyrannical busybodies whereas young Americans didn't care. This is part of why I eventually left the banking system; I felt sick that I had to report this information, but it's amazing how quick everyone is to accept the new rules. Notice how one of the comments asks you what you intend to do with the money, as if it's any of their business. Welcome to the New America©! My answer: If you withdraw $100,000, here is what will more than likely happen: Now, watch the anger at this answer because I'm telling you the truth. This article will explain why. Your very question had a negative 1, as if asking what you're asking is wrong (see the absurdity)! If Joseph Stalin ran for president in the United States, the majority of Americans would welcome him. You have good reason to be concerned; others at this site have noticed this as well.\"", "title": "" }, { "docid": "1be205a66cc2223a2ca6a8586e4ef545", "text": "I have to second what the poster said above me. The person at the dealership is outright lying to you, and I really don't know where the misconception comes from. I work in finance and specialize in credit. Credit is your ability to repay. Simple as that. To lenders, constant carrying a balance on your credit cards looks like your don't have the ability/discipline to repay your debt and will look bad in the future if you are ever trying to borrow more.", "title": "" }, { "docid": "79f31adf9ba96bc685681684d0bfdc6a", "text": "Banks and credit unions are constantly required to improve their detection methods for suspicious transactions. It's not just big transactions anymore, it's scattered little ones, etc. Our credit union had to buy software that runs through transactions sniffing for suspicious patterns. More regulations and more costs that ultimately get passed on to customers in one way or another. Some of your transactions probably tripped a wire where there was none before.", "title": "" }, { "docid": "d7ced92773d31e6a383a1fca45b76489", "text": "It will be considered 'unused credit'. I have tried it yeas ago. They just report zero usage.", "title": "" }, { "docid": "b4667ca0b508c1213651893932ccb69e", "text": "\"Understood. But based on the OP, it's not categorically clear what they were refusing. If they refused to quote the balance and/or refused to take a phone payment that was otherwise in keeping with the cardholder agreement (i.e., the cardmember called the correct number for phone payments and balance-checking, etc), then yeah, they were not only being unreasonable, but also violating the contract. What I read as ambiguous is whether the cardholder was specifically asking for the payoff balance/amount, and whether they were following process for phone-payments and balance-checking, etc. IOW, it's not necessarily \"\"illegal\"\" and might not even be unreasonable for the customer-service number to have different departments for balance-checking and phone-payments versus card-cancellation. It's not falsifiably clear from the OP that the cardholder was not asking the person on the other end of the phone for categorical statements of fact that they were obligated to make. I'm not accusing anyone of lying or saying that the CC company was acting reasonably, I'm just saying that language such as \"\"They do not provide mid-cycle payoff quotes\"\" is not evidence that they were doing any kind of funny-business.\"", "title": "" }, { "docid": "a9957097b8c49ec3dfe42d548cfb7989", "text": "You were an unsecured creditor. If Refco had a corporate credit card Visa would be in the exact same position you were. Nothing to do with being the little guy per se, just that UCC Article 9/the Bankruptcy Code has a massive preference for secured creditors over unsecureds. (Which I think is not the best idea, but for other reasons.) Just took my Secured Credit final a few days ago.", "title": "" }, { "docid": "83b726abb06b3facfd6be7b430d842bc", "text": "Good! The article says it was some kind of collateral protection insurance that customers were signed up for despite it being unrequired for the loan. The accusations is that WF racketeered about 800,000 loans by bundling in this bunk insurance cost as part of the loan structure. I'm glad you're not caught up in it.", "title": "" }, { "docid": "ba3d704d618558342f944c113eba299a", "text": "Fun Fact Followup: The war on terrorism is directly correlated to increases in measures to follow money that isn't being claimed as income (aka laundered). The acts being instituted to prevent the funding of terrorism have made cash increasingly difficult to spend and made the tracking of earnings more of a priority.", "title": "" } ]	fiqa
efb7b64c738100e63360802510b45f1f	Who performs the blocking on a Visa card?	[ { "docid": "be5e92c9a470b50398820cd8544a10a2", "text": "It is the people who you bought the ticket from. Blocking is frequently done by hotels, gas stations, or rental car companies. Also, for anything where the credit card might be used to cover any damages or charges you might incur later as part of the transaction. In essence, they are reserving part of your credit limit, ostensibly to cover charges they reasonably expect you might incur. For example, when you start pumping gas using a credit card they may block out $100 to make sure you don't pump a full tank and your credit card is declined because you ran over your limit at $3. In general, the blocks clear fairly quickly after you settle up with the company on your final bill. You can also ask the company to clear the block, but I don't think they are required to by law in any specific time period. It may be up to their (and your) agreement with the credit card company. Normally it isn't an issue and you don't even notice this going on behind the scenes, but if you keep your credit card near its limit, or use a debit card it can lead to nasty surprises (e.g. they can make you overdraw your account). One more reason not to use debit cards. More information is available here on the Federal Trade Commission's website.", "title": "" }, { "docid": "9c2be8ee86a7dcb0106c788ebe40eead", "text": "The request to block the money is made by the Party who sells the product. Based on this request the Bank blocks the funds. Subsequently the Party who sold the product makes a charge against this block. Just to give an easy example; So in the online train booking there are multiple messages sent between the Bank and SNCF. Something has gone wrong. It looks like the message from Bank sending back the Block reference number to SNCF has not reached. So as per Bank there is a Block and as per SNCF there is no block. Keep chasing SNCF to issue a letter so that you can send it to the Bank and get the Block removed. Typically the Blocks by the Bank are for a period of 30 days and if there is no charge against that block it automatically gets reversed.", "title": "" }, { "docid": "254b29225b915be822ea4a883a43a442", "text": "\"There are, in fact, two balances kept for your account by most banks that have to comply with common convenience banking laws. The first is your actual balance; it is simply the sum total of all deposits and withdrawals that have cleared the account; that is, both your bank and the bank from which the deposit came or to which the payment will go have exchanged necessary proof of authorization from the payor, and have confirmed with each other that the money has actually been debited from the account of the payor, transferred between the banks and credited to the account of the payee. The second balance is the \"\"available balance\"\". This is the actual balance, plus any amount that the bank is \"\"floating\"\" you while a deposit clears, minus any amount that the bank has received notice of that you may have just authorized, but for which either full proof of authorization or the definite amount (or both) have not been confirmed. This is what's happening here. Your bank received notice that you intended to pay the train company $X. They put an \"\"authorization hold\"\" on that $X, deducting it from your available balance but not your actual balance. The bank then, for whatever reason, declined to process the actual transaction (insufficient funds, suspicion of theft/fraud), but kept the hold in place in case the transaction was re-attempted. Holds for debit purchases usually expire between 1 and 5 days after being placed if the hold is not subsequently \"\"settled\"\" by the merchant providing definite proof of amount and authorization before that time. The expiration time mainly depends on the policy of the bank holding your account. Holds can remain in place as long as thirty days for certain accounts or types of payment, again depending on bank policy. In certain circumstances, the bank can remove a hold on request. But it is the bank, and not the merchant, that you must contact to remove a hold or even inquire about one.\"", "title": "" } ]	[ { "docid": "36320d5d3ef4f2c73640925da28ba1b3", "text": "Generally, credit card networks (as opposed to debit/ATM cards that may or may not have Visa/MC logos) have a rule that a merchant must accept any credit card with their logo. Visa rules for merchants in the US say it explicitly: Accept all types of valid Visa cards. Although Visa card acceptance rules may vary based on country specific requirements or local regulations, to offer the broadest possible range of payment options to cardholder customers, most merchants choose to accept all categories of Visa debit, credit, and prepaid cards.* Unfortunately the Visa site for China is in Chinese, so I can't find similar reference there. You can complain against a merchant who you think had violated Visa rules here. That said, its not a law, its a contract between the merchant processor and the Visa International organization, and merchants are known to break these rules here and there (most commonly - refusing to accept foreign cards, including in the US). Also, local laws may affect these contracts (for example, in the US it is legal to set minimum amount requirements when accepting credit cards). This only affects credit card processing, and merchants that don't accept credit cards may still accept debit cards since those work in different networks, under a different set of rules. Those who accept credit cards, are also required to accept debit cards (at least if used as credit).", "title": "" }, { "docid": "cee2f6ca79d788f239484db00eff466d", "text": "\"Did you even read the article? These were people who went into the store and did this in person. there are no \"\"orders\"\" to cancel. As for invalidating the cards, again, the article stated that many people took the Target gift cards and used them to buy Amex and Visa gift cards. tl;dr RTFA\"", "title": "" }, { "docid": "5cbabb8e33466d09fa56112969ee35f3", "text": "Having worked at a financial institution, this is a somewhat simple, two-part solution. 1) The lendor/vendor/financial institution simply turns off the overdraft protection in all its forms. If no funds are available at a pin-presented transaction, the payment is simply declined. No fee, no overdraft, no mess. 2) This sticking point for a recurring transaction, is that merchants such as Netflix, Gold's Gym etc, CHOOSE to allow payments like this, BECAUSE they are assured they are going to get paid by the financial institution. It prevents them from having issues. Only a gift card will not cost you more money than you put in, BUT I know of several institutions, that too many non-payment periods can cause them to cease doing business with you in the future. TL:DR/IMO If you don't want to pay more than you have, gift cards are the way to go. You can re-charge them whenever you choose, and should you run into a problem, simply buy a new card and start over.", "title": "" }, { "docid": "b0c63f8ceefa08c9cd94e5324d84bd46", "text": "\"Having worked in the financial industry, I can say 9:10 times a card is blocked, it is not actually the financial industry, but a credit/credit card monitoring service like \"\"Falcon\"\" for VISA. If you have not added travel notes or similar, they will decline large, our of country purchases as a way to protect you, from what is most likely fraud. Imagine if you were living in Sweden and making regular steady purchases, then all of a sudden, without warning your card was used in Spain. This would look suspicious on paper, even it was obvious to you. This is less to do with your financial institution, and more to do with increased fraud prevention. Call your bank. They will help you.\"", "title": "" }, { "docid": "99560b2878dc01ae12ee6c5764a9c92b", "text": "Security in the merchant services system is mainly handled in two ways: 1) Before transactions are done, the business itself must go through an application process similar (but not identical) to getting a loan. Some high risk businesses must pay higher fees due to the increased likelihood of customer complaints. 2) When a customer disputes a transaction, that's a mark against the business. Get too many of these disputes, and your priviledge of accepting credit cards will be revoked, meaning you won't be able to again. It's in the merchant's best interest to verify customer's identity, because disputes cost them money directly. It's in the servicer's best interest to verify the businesses integrity, because fraud drives up the cost for everyone else. As a whole, it's quite a reactionary system, yet in practice it works remarkably well.", "title": "" }, { "docid": "8f5767d1419297a9b538d367bd4a0332", "text": "I have a visa with Scotiabank and I purposefully keep a negative balance at times. The guy at the bank said it was a great idea. I have never received a cheque, nor do I want one. The reason is that it allows me to make quick purchases without having to worry about paying back and due dates. Only with large purchases do I allow myself to do that. I still check in with my account every once in a while just to make sure everything is all right. It allows for good money management and piece of mind. I have been doing it for a couple of years and have not been penalized at all. (Wouldn't really make sense to do so though.)", "title": "" }, { "docid": "e4cc102282845eeb1dbc3020245320c8", "text": "If the cards are tied to a specific vendor, they will work only at that vendor. If they're generic cards just charged with a specific amount of money, they should work at any vendor who accepts that card network... though there may be specific exceptions.", "title": "" }, { "docid": "28349274456d5728c148fd4f35165880", "text": "This is a question with a flawed premise. Credit cards do have two-factor authentication on transactions they consider more at risk to be fraudulent. I've had several times when I bought something relatively expensive and unusual for me, where the CC either initially declined and sent me a text asking to confirm immediately (after which they would approve the charges), or approved but sent me a text right away asking to confirm (after which they'd automatically dispute if I told them to). The first is legitimately what you are asking for; the second is presumably for less risky but still some risk transactions). Ultimately, the reason they don't allow it for every transaction is that not enough people would make use of it to be worth their time to implement it. Particularly given it slows down the transaction significantly (and look at the complaints at the ~10-15 seconds extra EMV authentication takes, imagine that as a minute or more), I think you'd get a single digit percentage of people using that service.", "title": "" }, { "docid": "e2869ed77f1c671a95cb9d46ce27d144", "text": "There are thousands of processors. But I explicitly mentioned the customer experience, which is completely different and no matter how much you want your industry experience to matter for that, it doesn't affect it. This you did not read and comprehend. Could you clarify for me how VISA/MasterCard managed to block a merchant, who presumably wasn't a direct customer (but instead a payment processor customer), but cannot block a card holder? (yes, this is an honest question) > Visa and Mastercard prohibited payments to Wikileaks on the basis of WL allegedly facilitating illegal activity. How is that relevant to what PayPal's doing? The WikiLeaks blockade was clearly political. What makes you say otherwise? And this is political. > No one is unable to accept payments if they're barred from PayPal. In this case, yes. So who is morally and/or legally responsible when everyone does the same thing?", "title": "" }, { "docid": "4bcb8768fec274447c5e41195f94b885", "text": "They could if they wanted. It's of course illegal to do if you didn't authorize it, and to process credit cards, they need to have a relationship with a credit card processing company, which is not so easy to fake - not any Joe could do that using a fake ID. Note that you are protected through your credit card company; if you tell them it's an unauthorized charge, they'll return it to you without discussion. It is then the vendor's duty to prove that it was authorized, and if he cannot, he'll pay extra fees to the processing company. Overall, the risk is very small; it shouldn't be your worry.", "title": "" }, { "docid": "422e6a852c0f6568b2848a07cab29dfa", "text": "\"File a John Doe lawsuit, \"\"plaintiff to be determined\"\", and then subpoena the relevant information from Mastercard. John Doe doesn't countersue, so you're pretty safe doing this. But it probably won't work. Mastercard would quash your subpoena. They will claim that you lack standing to sue anyone because you did not take a loss (which is a fair point). They are after the people doing the hacking, and the security gaps which make the hacking possible. And how those gaps arise among businesses just trying to do their best. It's a hard problem. And I've done the abuse wars professionally. OpSec is a big deal. You simply cannot reveal your methods or even much of your findings, because that will expose too much of your detection method. The ugly fact is, the bad guys are not that far from winning, and catching them depends on them unwisely using the same known techniques over and over. When you get a truly novel technique, it costs a fortune in engineering time to unravel what they did and build defenses against it. If maybe 1% of attacks are this, it is manageable, but if it were 10%, you simply cannot staff an enforcement arm big enough - the trained staff don't exist to hire (unless you steal them from Visa, Amex, etc.) So as much as you'd like to tell the public, believe me, I'd like to get some credit for what I've done -- they just can't say much or they educate the bad guys, and then have a much tougher problem later. Sorry! I know how frustrating it is! The credit card companies hammered out PCI-DSS (Payment Card Industry Data Security Standards). This is a basic set of security rules and practices which should make hacking unlikely. Compliance is achievable (not easy), and if you do it, you're off the hook. That is one way Amy can be entirely not at fault. Example deleted for length, but as a small business, you just can't be a PCI security expert. You rely on the commitments of others to do a good job, like your bank and merchant account salesman. There are so many ways this can go wrong that just aren't your fault. As to the notion of saying \"\"it affected Amy's customers but it was Doofus the contractor's fault\"\", that doesn't work, the Internet lynch mob won't hear the details and will kill Amy's business. Then she's suing Mastercard for false light, a type of defamtion there the facts are true but are framed falsely. And defamation has much more serious consequences in Europe. Anyway, even a business not at fault has to pay for a PCI-DSS audit. A business at fault has lots more problems, at the very least paying $50-90 per customer to replace their cards. The simple fact is 80% of businesses in this situation go bankrupt at this point. Usually fraudsters make automated attacks using scripts they got from others. Only a few dozen attacks (on sites) succeed, and then they use other scripts to intercept payment data, which is all they want. They are cookie cutter scripts, and aren't customized for each site, and can't go after whatever personal data is particular to that site. So in most cases all they get is payment data. It's also likely that primary data, like a cloud drive, photo collection or medical records, are kept in completely separate systems with separate security, unlikely to hack both at once even if the hacker is willing to put lots and lots of engineering effort into it. Most hackers are script kiddies, able to run scripts others provided but unable to hack on their own. So it's likely that \"\"none was leaked\"\" is the reason they didn't give notification of private information leakage. Lastly, they can't get what you didn't upload. Site hacking is a well known phenomenon. A person who is concerned with privacy is cautious to not put things online that are too risky. It's also possible that this is blind guesswork on the part of Visa/MC, and they haven't positively identified any particular merchant, but are replacing your cards out of an abundance of caution.\"", "title": "" }, { "docid": "3e9fe3452596fd2359720dd83b2e2651", "text": "I'm not sure if this is what your looking for but my favorite piece of work was credit card fraud and ways banks are preventing it. Topics included: -Family's at risk (who has the most risk?) -Credit card strip vs chip -Cost on chip scanners for local businesses -Apple Pay and the likelihood of getting hacked -Insurance and how it will cover a business with out chip readers -example of chipotle and target getting hacked -bitcoin and is it an easier source I wrote a paper about 4 years ago, and it had multiple finance topics involved into it. Hope this at least gives you a direction of what your looking for !", "title": "" }, { "docid": "24e058c484d98223fa47598e0e7487ef", "text": "\"Banks are businesses, and as such should have the right to refuse service, so they should probably be able to choose one customer over another at will. [I say \"\"should\"\" because business owners protecting themselves against litigation related to discrimination could restrict their freedom as business owners.] However, banks are businesses and if the customers are identical, both will be approved (or not) according to credit records. Does not make sense to approve one person with a given credit record and refuse someone with a similar record. Unless they barely qualify. Since no two credit histories are identical, there are surely edge cases. Finally, if a customer is a long term customer with large deposits and/or significant amounts of business with the bank, the bankers will likely be inclined to do more business.\"", "title": "" }, { "docid": "334b64dd9b69e5dcffb441f922e147ed", "text": "\"American Express is great for this use case -- they have two user roles \"\"Account Agent\"\" and \"\"Account Manager\"\" which allow you to designate logins to review your account details or act on your behalf to pay bills or request service. This scheme is designed for exactly what you are doing and offers you more security and less hassle. More details here.\"", "title": "" }, { "docid": "e8f2a0b3957abc9cff84a66aee8918af", "text": "\"First - Welcome to Money.SE. You gave a lot of detail, and it's tough to parse out the single question. Actually, you have multiple issues. $1300 is what you need to pay the tax? In the 25% bracket plus 10% penalty, you have a 65% net amount. $1300/.65 = Exactly $2000. You withdraw $2000, have them (the IRA holder) withhold $700 in federal tax, and you're done. All that said, don't do it. Nathan's answer - payment plan with IRS - is the way to go. You've shared with us a important issue. Your budget is running too tight. We have a post here, \"\"the correct order of investing\"\" which provides a great guideline that applies to most visitors. You are missing the part that requires a decent sized emergency fund. In your case, calling it that, may be a misnomer, as the tax bill isn't an unexpected emergency, but something that should have been foreseeable. We have had a number of posts here that advocate the paid in full house. And I always respond that the emergency fund comes first. With $70K of income, you should have $35K or so of liquidity, money readily available. Tax due in April shouldn't be causing you this grief. Please read that post I linked and others here to help you with the budgeting issue. Last - You are in an enviable position, A half million dollars, no mortgage, mid 40s. Easily doing better than most. So, please forgive the soapbox tone of the above, it was just my \"\"see, that's what I'm talking about\"\" moment from my tenure here.\"", "title": "" } ]	fiqa
80686480703ff2e7189134b5ce5350b0	Are the AARP benefits and discounts worth the yearly membership cost?	[ { "docid": "6f076dd3187018636d45d0f17fa3d758", "text": "\"Note: this answer was provided when the question was only about Life Insurance, therefore it does not address any other \"\"benefits\"\" Term Life Insurance is very easy to evaluate, once you have determined how much you need and for how long. For significant amounts of coverage they may require a physical to be performed. The price quotes will be for two levels of health, so you can compare costs from many companies quite easily. You have several sources in no particular order: employer, independent company, 3rd party like AARP, AAA, or via you bank or credit union. Note that the 3rd party will be getting a cut of the premium. Also some choices offered from the employer or 3rd party may be limited in size or duration. The independent companies will be able to have terms that extend for 10 years or more. So view the insurance offered by AARP as just another option that has to be compared to all your other options.\"", "title": "" }, { "docid": "4abd220e2e701da0dd7a47df87939235", "text": "It depends on you. If you're not an aggressive shopper and travel , you'll recoup your membership fee in hotel savings with one or two stays. Hilton brands, for example, give you a 10% discount. AARP discounts can sometimes be combined with other offers as well. From an insurance point of view, you should always shop around, but sometimes group plans like AARP's have underwriting standards that work to your advantage.", "title": "" } ]	[ { "docid": "d4349c26f0d1b7638e5d334c9d495060", "text": "\"Buy term and invest the difference is certainly the standard recommendation, and for good reason. When you start looking at some sample numbers the \"\"buy term and invest the difference\"\" strategy starts to look very good. Here are the rates I found (27 yr old in Texas with good health, non-smoker, etc): $200k term life: $21/month $200k whole life: $177/month If you were to invest the difference in a retirement account for 40 years, assuming a 7% rate of return (many retirement planning estimates use 10%) you would have $411,859 at the end of that period. (If you use 10% that figure jumps to over $994k.) Needless to say, $400k in a retirement account is better than a $200k death benefit. Especially since you can't get the death benefit AND the cash value. Certainly one big difficulty is making sure you invest that difference. The best way to handle that is to set up a direct deposit that goes straight from your paycheck to the retirement account before it even touches your bank account. The next best thing would be an automatic transfer from your bank account. You may wonder 'What if I can no longer afford to invest that money?' First off, take a second and third look at your finances before you start eating into that. But if financial crisis comes and you truly can't afford to fund your own life insurance / retirement account then perhaps it will be a good thing you're not locked into a life insurance policy that forces you to pay those premiums. That extra freedom is another benefit of the \"\"buy term and invest the difference\"\" strategy. It is great that you are asking this question now while you are young. Because it is much easier to put this strategy into play now while you are young. As far as using a cash value policy to help diversify your portfolio: I am no expert in how to allocate long term investments after maxing out my IRA and 401k. (My IRA maxes out at $5k/year, another $5k for my wife's, another $16.5k for my 401k.) Before I maxed that out I would have my house paid for and kid's education saved for. And by then it would make sense to pay a financial adviser to help you manage all those investments. They would be the one to ask about using a cash value policy similar to @lux lux's description. I believe you should NEVER PUT YOUR MONEY INTO SOMETHING YOU DON'T UNDERSTAND. Cash value policies are complex and I don't fully understand them. I should add that of course my calculations are subject to the standard disclaimer that those investment returns aren't guaranteed. As with any financial decision you must be willing to accept some level of risk and the question is not whether to accept risk, but how much is acceptable. That's why I used 7% in my calculation instead of just 10%. I wanted to demonstrate that you could still beat out whole life if you wanted to reduce your risk and/or if the stock market performs poorly.\"", "title": "" }, { "docid": "a11b5b0f914084e7fe0ca39051dd3794", "text": "Here's a different take: Look through the lists of companies that offer shareholder perks. Here's one from Hargreaves Lansdown. See if you can find one that you already spend money with with a low required shareholding where the perks would actually be usable. Note that in your case, being curious about the whole thing and based in London, you don't have to rule out the AGM-based perks, unlike me. My reason for this is simple: with 3 out of 4 of the companies we bought shares in directly (all for the perks), we've made several times the dividend in savings on money we would have spent anyway (either with the company in which we bought shares or a direct competitor). This means that you can actually make back the purchase price plus dealing fee quite quickly (probably in 2/4 in our case), and you still have the shares. We've found that pub/restaurant/hotel brands work well if you use them or their equivalents anyway. Caveats: It's more enjoyable than holding a handful of shares in a company you don't care about, and if you want to read the annual reports you can relate this to your own experience, which might interest you given your obvious curiosity.", "title": "" }, { "docid": "be08d0c6a4da19a79000124e82331b20", "text": "\"Let's not trade insults. I understand defined benefit plans better than you think. Of course offering a lump-sum payout NOW is better for the company. If you think of the lifetime value of the pension, then yeah, it's \"\"worse\"\" for the recipient... but exactly like lottery winners, this is just a question of my personal discount rate. Maybe I want/need that money now, and value it more now than I would in 10/20/30 years. So it's a question for each individual to decide.\"", "title": "" }, { "docid": "fb78091094c61cbf35643c978ba23f06", "text": "I am in the process of writing an article about how to maximize one's Social Security benefits, or at least, how to start the analysis. This chart, from my friends at the Social Security office shows the advantage of waiting to take your benefit. In your case, you are getting $1525 at age 62. Now, if you wait 4 years, the benefit jumps to $2033 or $508/mo more. You would get no benefit for 4 years and draw down savings by $73,200, but would get $6,096/yr more from 64 on. Put it off until 70, and you'd have $2684/mo. At some point, your husband should apply for a spousal benefit (age 66 for him is what I suggest) and collect that for 4 years before moving to his own benefit if it's higher than that. Keep in mind, your generous pensions are likely to push you into having your social security benefit taxed, and my plan, above will give you time to draw down the 401(k) to help avoid or at least reduce this.", "title": "" }, { "docid": "22259b6d72da91a9fe3224dbeb616a0b", "text": "Just to make this a little less vauge, I will base everything on the Mercedes Benz American Express (MB AMEX) card, which is the closest to a $100 annual fee I found on American Express's website. The benefits of a card with an annual fee generally are worth the cost if (and only if) you spend enough money on the card, and avoid paying interest to offset the benefit. Using the MB AMEX card as a reference, it offers 5X points for Mercedes Benz purchases, 3X points at gas stations, 2X points at restaurants, and 1X points everywhere else. Even if we only make purchases at the 1X rate, it only takes charging $10,000 to the card in a year in order to make up the difference. Not too hard to do on a card someone uses as their main method of payment. Every dollar spent at the higher rates only makes that easier. There are a number of other benefits as well. After spending $5,000 on the card in a year, you receive a $500 gift card towards the purchase of a Mercedes Benz car. For anyone on the market for a Mercedes Benz, the card pays for itself multiple times with just this benefit.", "title": "" }, { "docid": "743927f8d0169b21133e551371dd0ba0", "text": "Here are the advantages to the HDHP/HSA option over the PPO option, some of which you've already mentioned: Lower premiums, saving $240 annually. Your employer is contributing $1500 to your HSA. As you mentioned, this covers your deductible if you need it, and if you don't, the $1500 is yours to keep inside your HSA. The ability to contribute more to your HSA. You will be able to contribute additional funds to your HSA and take a tax deduction. Besides the medical expenses applied to your deductible, HSA funds can be spent on medical expenses that are not covered by your insurance, such as dental, vision, chiropractic, etc. Anything left in your HSA at age 65 can be withdrawn just like with a traditional IRA, with tax due (but no penalty) on anything not spent on medical expenses. With the information that you've provided about your two options, I can't think of any scenario where you'd be better off with the PPO. However, you definitely want to look at all the rest of the details to ensure that it is indeed the same coverage between the two options. If you find differences, I wrote an answer on another question that walks you through comparing insurance options under different scenarios.", "title": "" }, { "docid": "b1eea7c8c7a4e954533912a071fb2bc8", "text": "Absolutely! Just because a spouse doesn't have a taxable income, doesn't mean they aren't providing real, tangible benefit to the family economy with an important job. As tragic as it is to consider losing your spouse, are you truly in a position to replace everything they do you for you? Knowing what they do for you and appreciating the effort your spouse gives is important, but don't sell short the dollar amount of what they provide. Your life insurance policy should be to keep you whole. Without your spouse, you will need childcare. You might need domestic services to the home. What about a nanny or similar service? Would $50K cover that until your child is an adult? There are a number of added expenses in the short and long term that would occur if a spouse died. How much for a funeral? Obviously you know the amount and term depends on the age of your kid. But I think you should really try to account for the number of daily hours you spouse puts in, and try to attach a cost to those hours. Then buy insurance for them just as you would for a wage earning. For example, buy a policy that is 10x the annual cost for services it would take to compensate for your spouse. Your tolerance for risk and cost can adjust it up and down from there.", "title": "" }, { "docid": "47fb206796060129179e6e6c7802f250", "text": "At sixty, you are in a different generation, where at least early on loyalty was rewarded. I sit between the x and y generations, and never have I ever felt a sense of loyalty FROM an employer. We all know the score, they'll fire me in a heartbeat if it helps the quarterly numbers, and I'll bail if I can get a better deal elsewhere. I only stick it out if the deal is good, or I don't want to have to explain a short tenure on.my resume. I'm not gonna tough it out with a struggling company if they can't give me my market value, because I know they'll kick me to the curb if I'm in need. There really is no loyalty anywhere in the system anymore, unless your a sucker. Loyalty MUST go both ways, and employers are the ones who gave up on it.", "title": "" }, { "docid": "2a0f844f3c5963ada5a2a178660340fb", "text": "The big benefit of a health savings account is the savings aspect. HSAs let you save up and invest money for your health care expenses. You don't just pay for medical care with pretax dollars - you get to invest those pretax dollars (possibly until you've retired). If you can afford to put money in the plan now, this can be a pretty good deal, especially if you're in a high tax bracket and expect to remain there after retirement. There are a lot of obnoxious limitations and restrictions, and there's political risk to worry about between now and when you spend the money (mostly uncertainty about what the heck the health insurance system will look like after the fight over ObamaCare and its possible repeal.)", "title": "" }, { "docid": "2150ae34d8f282844275dc3f72c68517", "text": "I'm guessing it depends on how much you'd be paying for membership. If you save more than the membership costs you and you actually use the products you buy and they don't get thrown away, then it's worth it. I'm not a member of a warehouse club but I do have a membership for another wholesale outlet, so I know a little bit about buying in bulk. You need to take the same approach to buying goods wholesale as you would in an ordinary outlet, and do a few more things besides. Things like writing a list and sticking to it, making that list logically, so that you minimise the amount of time you spend walking around the shop. The less you see, the less you are likely to buy. Don't be taken in by offers, it's only a bargain if it's something you would have bought anyway. Don't shop on an empty stomach or with you children. And with bulk buying, you have to stick to things with long dates, unless your family gets through something at a phenomenal rate. Things like pet food are good, sugar too if you do a lot of home baking, that kind of thing. Toilet paper and kitchen roll are great to buy in bulk if you have the storage space and toothbrushes are good too. You'll always need them, always need to replace them, they don't take up much space and don't have a use by. The rules differ from family to family. Look at what your family uses and how much time it takes to get through something. That's the best place to start.", "title": "" }, { "docid": "de92e1a4ea311ce09e08ae3cb8f0d17f", "text": "Is it worth saving HSA funds until retirement? Yes Are there pros and cons from a tax perspective? Mostly pros. This has all of the benefits of an IRA, but if you use it for medical expenses then you get to use the money tax free on the other side. Retirement seems to be the time you are most likely to need money for medical expenses. So why wouldn't you want to start saving tax free to cover those expenses? The cons are similar to other tax advantaged retirement accounts. If you withdraw before retirement time for non-medical purposes, you will pay penalties, but if you withdraw at retirement time, you will pay the same taxes you would pay on an IRA. I should note that I put my money where my mouth is and I max out my contribution to my HSA every year.", "title": "" }, { "docid": "2bff6cd7047ca4577a71b8922e71219c", "text": "First let's define some terms. Your accrued benefit is a monthly benefit payable at your normal retirement age (usually 65). It is usually a life-only benefit but may have a number of years guaranteed or may have a survivor piece. It is defined by a plan formula (ie, it is a defined benefit). A lump sum is how much that accrued benefit is worth right now. Lump sums are based on applicable interest rates and mortality tables specified by the IRS (interest rates are released monthly, mortality annually). Your plan can either use the same interest rates for a whole year, or they can use new ones each month. Affecting your lump sum is whether your accrued benefit is payable now (immediately, you are age 65), or later (deferred, you are now age 30). For example, instead of being paid an annuity assume you are paid just one payment of $1,000 on your 65th birthday. The lump sum of that for a 65 year old would be $1,000 since there would be no interest discount, and no chance of dying before payment. For a 30 year old, at 4% interest the lump sum would be about $237 (including mortality discount). At age 36 the lump sum is $246. So the lump sum will get bigger just because you get older. Very important is the interest discount. At age 30 in the example, 2% interest would produce a $467 lump sum. And at 6% $122. The bigger the rate, the smaller the lump sum because interest helps an amount now grow bigger in the future. To complicate things, since 2008 the IRS bases lump sums on 3 different interest rates. The monthy annuity payments made within 5 years of the lump sum date use the 1st rate, past 5 and within 20 years use the 2nd rate, and past that use the 3rd rate. Since you are age 30, all of your monthly annuity payments would be made after 20 years, so that makes it simple since we'll only have to look at the 3rd rate. When you reach age 45 the 2nd rate will kick in. Here is the table of interest rates published by the IRS: http://www.irs.gov/Retirement-Plans/Minimum-Present-Value-Segment-Rates You'll find your rates above on the 2013 line for Aug-12. That means your lump sum is being made in 2013 and it is being based on the month August 2012. Most likely your plan will use the same rates for its entire plan year. But what is your plan year? If it is the calendar year, then you would have a 5 month lookback for the rates. But if is a September to August plan year with a 1 month lookback, the rates would have changed between August and September. Your August lump sum would be based on 4.52%, your September on would be based on 5.58% (see the All line for Aug-13). For comparison, a 30 year old with a $100 annuity payable at age 65 would have a lump sum value of $3,011 at 4.52%, but a lump sum value of $1,931 at 5.58%. The change in your accrued benefit by month will obviously have some impact on the lump sum value, but not as much as the change in interest rates if there is one. The amount they actually contribute to the plan has nothing to do with the value of the lump sum though.", "title": "" }, { "docid": "9582508ff18f868305f5e696269c7552", "text": "\"Assuming the numbers work out roughly the same (and you can frankly whip up a spreadsheet to prove that out), a defined benefit scheme that pays out an amount equal to an annuitized return from a 401(k) is better. The reason is not monetary - it is that the same return is being had at less risk. Put another way, if your defined benefit was guaranteed to be $100/month, and your 401(k) had a contribution that eventually gets to a lump sum that, if annuitized for the same life expectancy gave you $100/month, the DB is better because there is less chance that you won't see the money. Or, put even simpler, which is more likely? That New York goes Bankrupt and is relieved of all pension obligations, or, the stock market underperforms expectations. Neither can be ruled out, but assuming even the same benefit, lower risk is better. Now, the complication in your scenario is that your new job pays better. As such, it is possible that you might be able to accumulate more savings in your 401(k) than you might in the DB scheme. Then again, even with the opportunity to do so, there is no guarantee that you will. As such, even modelling it out really isn't going to dismiss the key variables. As such, can I suggest a different approach? Which job is going to make you happier now? Part of that may be money, part of that may be what you are actually doing. But you should focus on that question. The marginal consideration of retirement is really moot - in theory, an IRA contribution can be made that would equalize your 401(k), negating it from the equation. Grant you, there is very slightly different tax treatment, and the phaseout limits differ, but at the salary ranges you are looking at, you could, in theory, make decisions that would have the same retirement outcome in any event. The real question is then not, \"\"What is the effect in 20 years?\"\" but rather, which makes you happier now?\"", "title": "" }, { "docid": "25c73c24fa91cd5756013eee21f7adfb", "text": "I'm not the guy you're responding to, but you asked a good question. There's a dearth of data, but [about 1% is the estimate.] (http://www.businessinsurance.com/article/20110814/NEWS03/308149986#) Either way, having increased young adults on an insurance plan is a good thing. Socially, this demographic is exceptionally stinging from the Great Recession and I think the ability to give young adults health insurance (and thus the freedom to start developing a career without worrying about health coverage) outweighs the nominal additional premium costs. Fiscally, having young adults in a group plan decreases the risk profile of that plan since young adults don't incur the same expenses that a 45 or 50 year old would.", "title": "" }, { "docid": "96786e170859c0e9de4bd09ea45139af", "text": "I'm normally a fan of trying to put all the relevant info in an answer when possible, but this one's tough to do in one page. Here's the best way, by far to learn the basics: The OIC (Options Industry Council) has a great, free website to teach investors at all levels about options. You can set up a learning path that will remember which lessons you've done, etc. And they're really, truly not trying to sell you anything; their purpose is to promote the understanding and use of options.", "title": "" } ]	fiqa
114135080368cbd2b6f657eeae8875b1	Online sites for real time bond prices	[ { "docid": "af78c4c4186788dd4ac2f120b3c02a17", "text": "Bonds are extremely illiquid and have traditionally traded in bulk. This has changed in recent years, but bonds used to be traded all by humans not too long ago. Currently, price data is all proprietary. Prices are reported to the usual data terminals such as Bloomberg, Reuters, etc, but brokers may also have price gathering tools and of course their own internal trade history. Bonds are so illiquid that comparable bonds are usually referenced for a bond's price history. This can be done because non-junk bonds are typically well-rated and consistent across ratings.", "title": "" }, { "docid": "3c37c24f30645f6131887178f02722dc", "text": "FINRA lets you view recent trades, but as stated in the other answer bonds are illiquid and often do not trade frequently. Therefore recent trades prices are only a rough estimate of the current price that would be accepted. http://finra-markets.morningstar.com/BondCenter/Default.jsp", "title": "" } ]	[ { "docid": "29a1399a292d5cc55b09dfc576ba97f1", "text": "Bond information is much tougher to get. Try to find access to a Bloomberg terminal. Maybe you have a broker that can do the research for you, maybe your local university has one in their business school, maybe you know someone that works for a bank/financial institution or some other type of news outlet. Part of the reason for the difference in ease of access to information is that bond markets are dominated by institutional investors. A $100 million bond issues might be 90% owned by 10-20 investors (banks, insurance co's, mutual funds, etc.) that will hold the bonds to maturity and the bonds might trade a few times a month/year. On the other hand a similar equity offering may have several hundred or thousand owners with daily trading, especially if it's included in an active stock index. That being said, you can get some information on Fidelity's website if you have an account, but I think their junk data is limited. Good luck with the hunt.", "title": "" }, { "docid": "ec01e6ad07bd6f63d716dde54886fb4c", "text": "\"My broker (thinkorswim) offers this from the platform's trade tab. I believe this feature isn't crippled in the PaperMoney version which is effectively a \"\"free online service.\"\"\"", "title": "" }, { "docid": "ff7f871a450e24d96f85664029365357", "text": "Investopedia has one and so does marketwatch I've always used marketwatch, and I have a few current competitions going on if you want me to send the link They recently remodeled the website so it works on mobile and not as well on desktop Don't know anything about the investopedia one though", "title": "" }, { "docid": "a6cf13ea4d096712e382bab3746657bf", "text": "\"BestInvest is a UK site looking at that URL, base on the \"\"co.uk\"\" ending. Yahoo! Finance that you use is a US-based site unless you add something else to the URL. UK & Ireland Yahoo! Finance is different from where you were as there is something to be said for where are you looking. If I was looking for a quarter dollar there are Canadian and American coins that meet this so there is something to be said for a higher level of categorization being done. \"\"EUN.L\"\" would likely denote the \"\"London\"\" exchange as tickers are exchange-specific you do realize, right?\"", "title": "" }, { "docid": "2379e2f1e6f178d08404ad68f7796fef", "text": "http://www.moneysupermarket.com/shares/CompareSharesForm.asp lists many. I found the Interactive Investor website to be excruciatingly bad. I switched to TD Waterhouse and found the website good but the telephone service a bit abrupt. I often use the data presented on SelfTrade but don't have an account there.", "title": "" }, { "docid": "5bfedbdd63f74534043d2d59fcef16b4", "text": "Like others have said, mutual funds don't have an intraday NAV, but their ETF equivalents do. Use something like Yahoo Finance and search for the ETF.IV. For example VOO.IV. This will give you not the ETF price (which may be at a premium or discount), but the value of the underlying securities updated every 15 seconds.", "title": "" }, { "docid": "4d6381ad358c1cb678364f7bbd7fdd3e", "text": "Never trust a single source to give you a fair price, especially if they are not in competition, moreso if they know that's the case. I would want to get a quote from at least one other broker in terms of what they feel they can sell the bonds for. (and let them know they are not the only one you are getting a quote from) To start with you need information, such as when is the last time a bond like the ones you have traded and what did it sell for. Also sources for where you can sell the bonds and more info on the entire subject. SIFMA (The Securities Industry and Financial Markets Association) has a pretty helpful website called InvestingInBonds.com. I find it has a wealth of information, and is relatively free of bias. On the Municipal Markets at a Glance page you can get history for various bonds if you have the CUSIP (pronounced 'que-sip') numbers for the bonds. If these bonds are as good as the advisor is telling you they are, then they should be selling for a premium, and the recent sales history would reflect that. I'd find one or two other potential sellers, and get prices from each of them, compare that against recent history and go with whichever one seems to be offering you the best deal. In terms of choosing someone, and how to go about selling bonds, the same website has some excellent information and guidance on buying and selling bonds and How to Choose an Investment Professional which includes how to check up on them to see if they have ever faced disciplinary action, etc.. I would also consider any gains you might have to declare if you sell these for more than face value, and if that would be taxable etc. I would also question your 'too safe' judgement. Just because something is 'safe' I would not necessarily throw it out. You need to look at the return relative to the risk, and if you are not investing in a tax sheltered account, the affect of taxes on your net return. If these are earning a really good return, for fairly low risk, they might be worth keeping, especially if in today's market you need to take substantially more risk to get a comparable return. Taking more risk to get nearly the same return isn't very wise, since an aspect of the risk is perhaps not getting any return, or losing money. In a volatile market there can be a substantial benefit to having a lower risk 'foundation' that you build upon with more risky investments, in order to provide some risk diversity in your portfolio. You might want to consider for example how these bonds have done over the last 13 years, compared to a similar investment in the type of 'less safe' vehicles you are considering. Perhaps you'd be better off just holding these to maturity instead of gambling on something with a lot more risk that could go south on you.", "title": "" }, { "docid": "f23a77c2c5432db5c7cf786f6e890560", "text": "I find this site to be really poor for the virtual play portion, especially the options league. After you place a trade, you can't tell what you actually traded. The columns for Exp and type are blank. I have had better luck with OptionsXpress virtual trader. Although they have recently changed their criteria for a non funded accounts and will only keep them active for 90 days. I know the cboe has a paper trading platform but I haven't tried it out yet.", "title": "" }, { "docid": "76e622fc225406dbd70fb144752364dc", "text": "\"You could use any of various financial APIs (e.g., Yahoo finance) to get prices of some reference stock and bond index funds. That would be a reasonable approximation to market performance over a given time span. As for inflation data, just googling \"\"monthly inflation data\"\" gave me two pages with numbers that seem to agree and go back to 1914. If you want to double-check their numbers you could go to the source at the BLS. As for whether any existing analysis exists, I'm not sure exactly what you mean. I don't think you need to do much analysis to show that stock returns are different over different time periods.\"", "title": "" }, { "docid": "e4f5c6d61371d33e986f4fce659ed7ff", "text": "The duration of a bond tells you the sensitivity of its price to its yield. There are various ways of defining it (see here for example), and it would have been preferable to have a more precise statement of the type of duration we should assume in answering this question. However, my best guess (given that the duration is stated without units) is that this is a modified duration. This is defined as the percentage decrease in the bond price for a 1% increase in the yield. So, change in price = -price x duration (as %) x change in yield (in %) For your duration of 5, this means that the bond price decreases by a relative 5% for every 1% absolute increase in its yield. Using the actual yield change in your question, 0.18%, we find: change in price = -1015 x 5% x (4.87 - 4.69) = -9.135 So the new price will be 1015 - 9.135 = £1005.865", "title": "" }, { "docid": "5819b1b16bb5a329fb87dea149f8148b", "text": "Goldprice.org has different currencies and historical data. I think silverprice.org also has historical data.", "title": "" }, { "docid": "9d2c4d22186c5ed898b4a500810a60ed", "text": "In my graduate thesis I explored the liquidity changes in the bond markets. Part of my research led me to also identifying an opportunity for blockchain to play a role in measuring it, something mathematically impossible but increasingly necessary in fixed Income. Definitely interested", "title": "" }, { "docid": "db80ee9cc1f82f76ee6adc6bc300bb4f", "text": "\"Yes, Interactive Brokers is a good source for live data feeds and they have an API which is used to programmatically access the feeds, you will have to pay for data feeds from the individual data sources though. The stock exchanges have a very high price for their data and this has stifled innovation in the financial sector for several decades in the united states. But at the same time, it has inflated the value and mystique of \"\"quants\"\" doing simple algorithms \"\"that execute within milliseconds\"\" for banks and funds. Also RIZM has live feeds, it is a younger service than other exchanges but helps people tap into any online broker's feeds and let you trade your custom algorithms that way, that is their goal.\"", "title": "" }, { "docid": "ce74473919d8ee1c40037ea199392734", "text": "An alternative to paying thousands of dollars for historical prices by the minute: Subscribe to real time data for as low as USD$1.5/month from your broker, then browse the chart.", "title": "" }, { "docid": "7463e6b01c2f38e523cd6ba482a29b8a", "text": "\"A couple of distinctions. First, if you were to \"\"invest in real estate\"\" were you planning to buy a home to live in, or buy a home to rent out to someone else? Buying a home as a primary residence really isn't \"\"investing in real estate\"\" per se. It's buying a place to live rather than renting one. Unless you rent a room out or get a multi-family unit, your primary residence won't be income-producing. It will be income-draining, for the most part. I speak as a homeowner. Second, if you are buying to rent out to someone else, buying a single home is quite a bit different than buying an REIT. The home is a lot less liquid, the transaction costs are higher, and all of your eggs are in one basket. Having said that, though, if you buy one right and do your homework it can set you on the road for a very comfortable retirement.\"", "title": "" } ]	fiqa
109744268287dc4f3f7240c7aa146e6a	Mortgage loan and move money to US	[ { "docid": "5712bdc7208402f56051e2fd71d54a61", "text": "Let me restate question for clarity. Facts: Question: Are there any taxes for this transaction? Answer: (Added improvements provided by Eric) Generally No. Generally, it is not considered income until you sell and the sale price is greater than the purchase price. But with currency differences, there is an additional complication, section 988 rules apply. It could result in ordinary income or loss.", "title": "" } ]	[ { "docid": "b528f2b68ccc47dd8e86323231c148b1", "text": "\"No. This is too much for most individuals, even some small to medium businesses. When you sell that investment, and take the cheque into the foreign bank and wire it back to the USA in US dollars, you will definitely obtain the final value of the investment, converted to US$. Thats what you wanted, right? You'll get that. If you also hedge, unless you have a situation where it is a perfect hedge, then you are gambling on what the currencies will do. A perfect hedge is unusual for what most individuals are involved in. It looks something like this: you know ForeignCorp is going to pay you 10 million quatloos on Dec 31. So you go to a bank (probably a foreign bank, I've found they have lower limits for this kind of transaction and more customizable than what you might create trading futures contracts), and tell them, \"\"I have this contract for a 10 million quatloo receivable on Dec 31, I'd like to arrange a FX forward contract and lock in a rate for this in US$/quatloo.\"\" They may have a credit check or a deposit for such an arrangement, because as the rates change either the bank will owe you money or you will owe the bank money. If they quote you 0.05 US$/quatloo, then you know that when you hand the cheque over to the bank your contract payment will be worth US$500,000. The forward rate may differ from the current rate, thats how the bank accounts for risk and includes a profit. Even with a perfect hedge, you should be able to see the potential for trouble. If the bank doesnt quite trust you, and hey, banks arent known for trust, then as the quatloo strengthens relative to the US$, they may suspect that you will walk away from the deal. This risk can be reduced by including terms in the contract requiring you to pay the bank some quatloos as that happens. If the quatloo falls you would get this money credited back to your account. This is also how futures contracts work; there it is called \"\"mark to market accounting\"\". Trouble lurks here. Some people, seeing how they are down money on the hedge, cancel it. It is a classic mistake because it undoes the protection that one was trying to achieve. Often the rate will move back, and the hedger is left with less money than they would have had doing nothing, even though they bought a perfect hedge.\"", "title": "" }, { "docid": "97d71f0aa71ee30780c8ca0195c66503", "text": "To transfer US$30,000 from the USA to Europe, ask your European banker for the SWIFT transfer instructions. Typically in the USA the sending bank needs a SWIFT code and an account number, the name and address of the recipient, and the amount to transfer. A change of currency can be made as part of the transfer. The typical fee to do this is under US$100 and the time, under 2 days. But you should ask (or have the sender ask) the bank in the USA about the fees. In addition to the fee the bank may try to make a profit on the change of currency. This might be 1-2%. If you were going to do this many times, one way to go about it is to open an account at Interactive Brokers, which does business in various countries. They have a foreign exchange facility whereby you can deposit various currencies into your account, and they stay in that currency. You can then trade the currencies at market rates when you wish. They are also a stock broker and you can also trade on the various exchanges in different countries. I would say, though, they they mostly want customers already experienced with trading. I do not know if they will allow someone other than you to pay money into your account. Trading companies based in the USA do not like to be in the position of collecting on cheques owed to you, that is more the business of banks. Large banks in the USA with physical locations charge monthly fees of $10/mo or more that might be waived if you leave money on deposit. Online banks have significantly lower fees. All US banks are required to follow US anti-terrorist and anti-crime regulations and will tend to expect a USA address and identity documents to open an account with normal customers. A good international bank in Europe can also do many of these same sorts of things for you. I've had an account with Fortis. They were ok, there were no monthly fees but there were fees for transactions. In some countries I understand the post even runs a bank. Paypal can be a possibility, but fees can be high ~3% for transfers, and even higher commissions for currency change. On the other hand, it is probably one of the easiest and fastest ways to move amounts of $1000 or less, provided both people have paypal accounts.", "title": "" }, { "docid": "2afdb7895ff858324e1611105b470a98", "text": "\"Bad plan. This seems like a recipe for having your money taken away from you by CBP. Let me explain the biases which make it so. US banking is reliable enough for the common citizen, that everyone simply uses banks. To elaborate, Americans who are unbanked either can't produce simple identity paperwork; or they got an account but then got blacklisted for overdrawing it. These are problems of the poor, not millionaires. Outside of determined \"\"off the grid\"\" folks with political reasons to not be in the banking and credit systsm, anyone with money uses the banking system. Who's not a criminal, anyway. We also have strong laws against money laundering: turning cash (of questionable origin) into \"\"sanitized\"\" cash on deposit in a bank. The most obvious trick is deposit $5000/day for 200 days. Nope, that's Structuring: yeah, we have a word for that. A guy with $1 million cash, it is presumed he has no choice: he can't convert it into a bank deposit, as in this problem - note where she says she can't launder it. If it's normal for people in your country to haul around cash, due to a defective banking system, you're not the only one with that problem, and nearby there'll be a country with a good banking system who understands your situation. Deposit it there. Then retain a US lawyer who specializes in this, and follow his advice about moving the money to the US via funds transfer. Even then, you may have some explaining to do; but far less than with cash. (And keep in mind for those politically motivated off-the-financial-grid types, they're a bit crazy but definitely not stupid, live a cash life everyday, and know the law better than anybody. They would definitely consider using banks and funds transfers for the border crossing proper, because of Customs. Then they'll turn it into cash domestically and close the accounts.)\"", "title": "" }, { "docid": "76def0924a473ee8754ddbcfa1ab06b3", "text": "If possible, I would open a Canadian bank account with a bank such as TD Canada Trust. You can then have your payments wired into that account without incurring costs on receipt. They also allow access to their US ATM network via TD Bank without additional costs. So you could use the American Affiliate to pull the funds out via a US teller while only bearing the cost of currency conversion. If that option can't work then the best route would be to choose a US bank account that doesn't charge for incoming wire transfers and request that the money be wired to your account (you'll still get charged the conversion rate when the wire is in CAD and the account is in USD).", "title": "" }, { "docid": "303f9e3c17e772c2531668aa10c2dfe7", "text": "There is a fourth option - pay those taxes. Depending on the amounts, it might be the easiest way - if you make 34.49 in interest, and pay 6 $ in taxes on it, and be done, that might not be worth any other effort. If the expected taxable amount is significant, moving (most of it) to index funds or other simply switching existing investments to ‘reinvest’ instead of ‘pay out in cash’ would be the best approach. Again, some smaller amounts in savings or checkings accounts are probably not worth any effort. Transferring the money to the US doesn’t save you taxes, as any interest would still be taxable. You have a risk to lose on the conversion back and forth (and a potential to gain - the exchange rate could go either way!), so if you are sure you go back, it’s not a good idea to move the money.", "title": "" }, { "docid": "8257d17b4fce98bacecffd5f57a491f1", "text": "\"I've considered simply moving my funds to an Australian bank to \"\"lock-in\"\" the current rate, but I worry that this will put me at risk of a substantial loss (due to exchange rates, transfer fees, etc) when I move my funds back into the US in 6 months. Why move funds back? If you want to lock in current exchange rates, figure out how much money you are likely to spend in Australia for the next six months. Move just enough funds to cover that to an Australian bank. Leave the remainder in the United States (US), as your future expenses will be in US dollars. So long as you don't find some major, unanticipated purchase, this covers you. You have enough money for the next six months with no exchange rate worries. At the end of the six months, if you fall slightly short, cover with your credit card as you are doing now. You'll take a loss, but on a small amount of money. If you have a slight excess and you were right about the exchange rate, you'll make a little profit at the end. If you were wrong, you'll take a small loss. The key here is that you should be able to budget for your six months. You can lock in current exchange rates just for that amount of money. Moving all your funds to Australia is a gamble. You can certainly do that if you want, but rather than gambling, it may be better to take the sure thing. You know you need six months expenses, so just move that. You will definitely be spending six months money in Australia, so you are immune to exchange rate fluctuations for that period. The remainder of your money can stay in the US, as that's where you plan to spend it. However, recent political events back in the States have me (and, I'm sure, every currency speculator and foreign investor) worried that this advantage will not last for much longer. If currency speculators expect exchange rates to fall, then they'd have already bid down the rates. I.e. they'd keep speculating until the rates did fall. So the speculators expect the current rates are correct, otherwise they'd move them. Donald Trump's state goal is to increase exports relative to imports. If he's successful, this could cause the US dollar to fall to make exports cheaper and imports more expensive. However, if his policies fail, then the opposite is likely to happen. Most of his announced trade policies are more likely to increase the value of the dollar than to decrease it. In particular, that is the likely result of increased tariffs. If you are worried about Trump failing, then you should worry about a strong dollar. That's more in line with actual speculation since the election. I don't know that I'd make a strong bet in either direction. Hedging makes more sense to me, as it simply locks in the current situation, which you apparently find favorable. Not hedging at all might produce some profit if the dollar goes up. Gambling all your funds might produce some profit if the dollar goes down. The middle path of hedging just what you're spending is the safest if least likely to produce profit. My recommendation is to hedge the six months expenses and enjoy your time abroad. Why worry about political events that you can't control? Enjoy your working (studying) vacation.\"", "title": "" }, { "docid": "081d5ca1f1657f10952f8c55d28b9dd3", "text": "We've been in this situation for about 10 years now. We don't have to send money back to Canada very often, but when we do, we typically just write a US$ check/cheque and send it to a relative back home to cash for us. We've found that the Canadian banks are much more familiar with US currency than vice versa, and typically have better exchange rates than many of the other options. That said, we haven't done an exhaustive search for the best deal. If you haven't left Canada yet, you might consider opening up a US funds account at the same bank as your Canadian funds account if the bank will allow you to transfer money between the accounts. I haven't priced out that option, so I don't know what the exchange rate would look like there. Also, you didn't ask about this, but if you have any RRSP accounts in Canada, make sure they're with a broker that is licensed to accept trades from US-based customers. Otherwise, you won't be able to move your money around to different investments within the RRSP. Once you're resident in the US, you will no longer be able to open any new accounts in Canada, but you will be able to maintain the ones you already have.", "title": "" }, { "docid": "c75297b62f73553ec352cda7a9fff1b6", "text": "\"I've done exactly what you say at one of my brokers. With the restriction that I have to deposit the money in the \"\"right\"\" way, and I don't do it too often. The broker is meant to be a trading firm and not a currency exchange house after all. I usually do the exchange the opposite of you, so I do USD -> GBP, but that shouldn't make any difference. I put \"\"right\"\" in quotes not to indicate there is anything illegal going on, but to indicate the broker does put restrictions on transferring out for some forms of deposits. So the key is to not ACH the money in, nor send a check, nor bill pay it, but rather to wire it in. A wire deposit with them has no holds and no time limits on withdrawal locations. My US bank originates a wire, I trade at spot in the opposite direction of you (USD -> GBP), wait 2 days for the trade to settle, then wire the money out to my UK bank. Commissions and fees for this process are low. All told, I pay about $20 USD per xfer and get spot rates, though it does take approx 3 trading days for the whole process (assuming you don't try to wait for a target rate but rather take market rate.)\"", "title": "" }, { "docid": "cfb8a430ecf3e6b9bf29161f2f231924", "text": "\"Question is, what do we need to do as far as the IRS is concerned? I mean we'll get the money from them and pay it back less than two months later. You're probably worried about the gift tax. Since you're a couple, the maximum exclusion amount is calculated like this: The reason the Pg multiplier stands separate is that gift splitting does require form 709 filed even if no tax is due, unless they actually write separate checks for their respective portions. So the math shows that you and your wife can get at least $28K from anyone without the need of gift tax to be paid or gift tax return to be filed. You can get up to $56K from your parents, but the gift splitting may need to be documented on form 709. Since you're in fact talking about a loan you're going to repay, you'll need to document it (with a note and everything), and document the repayment. If interest is being paid - your parents must declare it on their tax return for the year, obviously. In this case, if the loan is properly documented, repaid and the interest is declared, the IRS won't even bother claiming it was a gift. Even if there's no real interest, it shouldn't be an issue (the IRS might assign some \"\"deemed\"\" interest at their rates that would be considered a gift, but assuming no other gift transactions between you exist for the year the amount would be miniscule and way below the $14K exclusion level). Of course, as with any tax concern, you get here what you paid for. For a proper advice talk to a tax adviser (EA/CPA) licensed in your State.\"", "title": "" }, { "docid": "457d622371d738723f400eaa2f67c280", "text": "frostbank.com is the closest thing I've found, so accepting this (my own) answer :) EDIT: editing from my comment earlier: frostbank.com has free incoming international wires, so that's a partial solution. I confirmed this works by depositing $1 (no min deposit requirement) and wiring $100 from a non-US bank. Worked great, no fees, and ACH'd it to my main back, no problems/fees. No outgoing international wires, alas.", "title": "" }, { "docid": "4e4d147b2b4432f5dcf87c40276ab22f", "text": "\"Several options are available. She may ask the US bank to issue a debit card (VISA most probably) to her account, and mail this card to Russia. I think this can be done without much problems, though sending anything by mail may be unreliable. After this she just withdraws the money from local ATM. Some withdrawal fee may apply, which may be rather big if the sum of money is big. In big banks (Alfa-bank, Citibank Russia, etc.) are ATMs that allow you to withdraw dollars, and it is better to use one of them to avoid unfavorable exchange rate. She may ask the US bank to transfer the money to her Russian account. I assume the currency on the US bank account is US Dollars. She needs an US dollar account in any Russian bank (this is no problem at all). She should find out from that bank the transfer parameters (реквизиты) for transfering US dollars to her account. This should include, among other info, a \"\"Bank correspondent\"\", and a SWIFT code (or may be two SWIFT codes). After this, she should contact her US bank and find out how can she request the money to be transferred to her Russian bank, providing these transfer parameters. I can think of two problems that may be here. First, the bank may refuse to transfer money without her herself coming to the bank to confirm her identity. (How do they know that a person writing or calling them is she indeed?) However, I guess there should be some workaround for this. Second, with current US sanctions against Russia, the bank may just refuse the transfer or will have do some additional investigations. However, I have heard that bank transfers from US to private persons to Russia are not blocked. Probably it is good to find this out in advance. In addition, the US bank will most probably charge some standard fee for foreign transfer. After this, she should wait for a couple of days, maybe up to week for the money to appear on Russian account. I have done this once some four years ago, and had no problems, though at that time I was in the US, so I just came to the bank myself. The bank employee to whom I talked obviously was unsure whether the transfer parameters were enough (obviously this was a very unusual situation for her), but she took the information from me, and I guess just passed it on to someone more knowledgable. The fee was something about $40. Another option that I might think of is her US bank issuing and mailing her a check for the whole sum, and she trying to cash it here in Russia. This is possible, but very few banks do cash checks here (Citibank Russia is among those that do). The bank will also charge a fee, and it will be comparable to transfer fee. Plus mailing anything is not quite reliable here. She would also have to consider whether she need to pay Russian taxes on this sum. If the sum is big and passes through a bank, I guess Russian tax police may find this out through and question her. If it is withdrawn from a VISA card, I think it will not be noticed, but even in this case she might be required to file a tax herself.\"", "title": "" }, { "docid": "2a6fc6409486bd64dced6e09bdc81cf5", "text": "From Chase FAQ it looks like this is a regular ACH transfer. ACH transactions can be reversed under certain conditions. I haven't been able to find some authoritative link on this, so I suggest this (thenest.com budgeting blog) instead: Allowed Reasons You can have ACH transactions reversed for one of three reasons under the rules: wrong money amount, wrong account or duplicated transactions. For example, if your mortgage bill is for $756.00, but your lender's website messes up and you're charged $856.00, the transaction is reversible it because it's the wrong dollar amount. If the website charges you $756.00 twice, the second duplicated transaction is reversible. Reversal Procedures You might have to bring a mistake to the originator's attention to get it fixed. Only the originator -- the person or company taking or sending money -- can ask for a reversal. For example, if you have a transaction for a wrong dollar amount from your lender's website, the originator is the lender. An originator is supposed to send the reversal within 24 hours of the error's discovery and within five banking days of the original transaction. When a reversal is required because of a wrong amount or wrong account, the originator must send a correcting entry with the right information. Bank's Responsibility A bank should honor an ACH reversal, even if it means debiting a customer's account again because of a correcting transaction. However, the bank doesn't have to debit your account if you closed it or the new transaction would overdraw it. Your bank does have to tell you if a correcting entry is going to take money out of your account, but the bank doesn't need your permission to do it.", "title": "" }, { "docid": "bd6817e4cdc5230ba683aa08909bea15", "text": "I would certainly hope to make the transfer by wire - the prospect of popping cross the border with several million dollars in the trunk seems... ill fated. I suppose I'm asking what sort of taxes, duties, fees, limits, &c. would apply Taxes - None. It is your money, and you can transfer it as you wish. You pay taxes on the income, not on the fact of having money. Reporting - yes, there's going to be reporting. You'll report the origin of the money, and whether all the applicable taxes have been paid. This is for the government to avoid money laundering. But you're going to pay all the taxes, so for transfer - you'll just need to report (and maybe, for such an amount, actually show the tax returns to the bank). Fees - shop around. Fees differ, like any other product/service costs on the marketplace.", "title": "" }, { "docid": "88c461ef9c397b80086de1ac45b49a68", "text": "I'm not sure I understand what you're trying to say, but in general its pretty simple: She goes to the UK bank and requests a wire transfer, providing your details as a recipient. You then go to your bank, fill the necessary forms for the money-laundaring regulations, you probably also need to pay the taxes on the money to the IRS, and then you have it. If you have 1 million dollars (or is it pounds?), I'm sure you can afford spending several hundreds for a tax attorney to make sure your liabilities are reduced to minimum.", "title": "" }, { "docid": "14c5d648e9c36963ce54c11facfab02d", "text": "You didn't specify where in the world you account is - ScotiaBank operates in many countries. However, for large amounts where there is a currency conversion involved, you are almost guaranteed to be better off going to a specialist currency broker or payments firm, rather than using a direct method with your bank (such as a wire transfer). Based on my assumption that your account is in Canada, one provider who I have personally used with success in transferwise, but the best place to compare where is the best venue for you is https://www.fxcompared.com In the off chance that this is an account with Scotiabank in the United States, any domestic payment method such as a domestic wire transfer should do the job perfectly well. The fees don't matter for larger amounts as they are a single fee versus a percentage fee like you see with currency conversions.", "title": "" } ]	fiqa
1cdad7bf2888616c3cbae3a6a7a5b899	Why do some companies (like this company) have such a huge per share price?	[ { "docid": "0bc934b26cd5698a318b31ef671dd898", "text": "\"Simple answer is because the stocks don't split. Most stocks would have a similar high price per share if they didn't split occasionally. Why don't they split? A better way to ask this is probably, why DO most stocks split? The standard answer is that it gives the appearance that stocks are \"\"cheap\"\" again and encourages investors to buy them. Some people, Warren Buffett (of Berkshire Hathaway) don't want any part of these shenanigans and refuse to split their stocks. Buffett also has commented that he thinks splitting a stock also adds unnecessary volatility.\"", "title": "" } ]	[ { "docid": "306e4dbc38dd9989c1d6bd8e12f8a6bc", "text": "\"What you need to do is go to yahoo finance and look at different stock's P/E ratios. You'll quickly see that the stocks can be sorted by this number. It would be an interesting exercise to get an idea of why P/E isn't a fixed number, how certain industries cluster around a certain number, but even this isn't precise. But, it will give you an idea as to why your question has no answer. \"\"Annual earnings are $1. What is the share price?\"\" \"\"Question has no answer\"\"\"", "title": "" }, { "docid": "6cc527b2e33635fc6ecdfc34695297db", "text": "Of course it is a dilution of existing shareholders. When you buy milk in the supermarket - don't you feel your wallet diluted a little? You give some $$$ you get milk in return. You give some shares, you get Watsapp in return. That's why such purchases must go through certain process of approval - board of directors (shareholders' representatives) must approve it, and in some cases (don't know if in this particular) - the whole body of the shareholders vote on the deal.", "title": "" }, { "docid": "c067f60aa6afa4f6133377c0af24b9eb", "text": "Fiduciary They are obligated by the rules of the exchanges they are listed with. Furthermore, there is a strong chance that people running the company also have stock, so it personally benefits them to create higher prices. Finally, maybe they don't care about the prices directly, but by being a good company with a good product or service, they are desirable and that is expressed as a higher stock price. Not every action is because it will raise the stock price, but because it is good for business which happens to make the stock more valuable.", "title": "" }, { "docid": "14f2999deae606e6f6c4ece90479ef58", "text": "If the company's ownership is structured similarly to a typical start-up then an 1% employee ownership in a company which sells for 1 million will yield far less than 10k due to various liquidation preferences of the investors, different share classes, etc. It's pretty hard to get a specific number because it depends a lot on the details of earlier fundraising and stock grants. That said, unless the company is circling the drain and the sale was just to avoid BK, the share price you get should be higher unless the share class structure and acquisition deal are completely unfair.", "title": "" }, { "docid": "85a1dc1faedb99d0afe67c678d523509", "text": "Would make sense that the higher liquidation cost and Transaction costs are driving the share price down. Higher liq and transaction means higher investors would require higher return, driving down the share price. The other possibilities I can think of off the top of my head, based on looking at the firm for five minutes 1) In transaction costs, did you include tax? Disclaimer: math below done on the back of the envelope in between meetings; So, NAV says they are at ~$75M. Liquidating that entire portfolio means about 22% capital gains tax rate. Which means after tax value is about $60M. Add in any fees you'd incur from trying to sell this stuff, and it's not unreasonable to assume you'll only get about $55M once all is said and done, which is pretty close to the actual market cap. If you have accounted for the above, consider ; 2) Bulk of their investments seem to be in private assets. Which implies that they have some discretion in how they mark the value of those investments. And, there is the chance that the market doesn't have confidence in these guys. What's their performance been like in recent years? Especially with a private asset portfolio, I'd be weary. If I was to invest in them, I'd want a higher return for the opaque portfolio.", "title": "" }, { "docid": "651f0068eeb897a2615880fe252207ee", "text": "\"In an IPO (initial public offering) or APO (additional public offering) situation, a small group of stakeholders (as few as one) basically decide to offer an additional number of \"\"shares\"\" of equity in the company. Usually, these \"\"shares\"\" are all equal; if you own one share you own a percentage of the company equal to that of anyone else who owns one share. The sum total of all shares, theoretically, equals the entire value of the company, and so with N shares in existence, one share is equivalent to 1/Nth the company, and entitles you to 1/Nth of the profits of the company, and more importantly to some, gives you a vote in company matters which carries a weight of 1/Nth of the entire shareholder body. Now, not all of these shares are public. Most companies have the majority (51%+) of shares owned by a small number of \"\"controlling interests\"\". These entities, usually founding owners or their families, may be prohibited by agreement from selling their shares on the open market (other controlling interests have right of first refusal). For \"\"private\"\" companies, ALL the shares are divided this way. For \"\"public\"\" companies, the remainder is available on the open market, and those shares can be bought and sold without involvement by the company. Buyers can't buy more shares than are available on the entire market. Now, when a company wants to make more money, a high share price at the time of the issue is always good, for two reasons. First, the company only makes money on the initial sale of a share of stock; once it's in a third party's hands, any profit from further sale of the stock goes to the seller, not the company. So, it does little good to the company for its share price to soar a month after its issue; the company's already made its money from selling the stock. If the company knew that its shares would be in higher demand in a month, it should have waited, because it could have raised the same amount of money by selling fewer shares. Second, the price of a stock is based on its demand in the market, and a key component of that is scarcity; the fewer shares of a company that are available, the more they'll cost. When a company issues more stock, there's more shares available, so people can get all they want and the demand drops, taking the share price with it. When there's more shares, each share (being a smaller percentage of the company) earns less in dividends as well, which figures into several key metrics for determining whether to buy or sell stock, like earnings per share and price/earnings ratio. Now, you also asked about \"\"dilution\"\". That's pretty straightforward. By adding more shares of stock to the overall pool, you increase that denominator; each share becomes a smaller percentage of the company. The \"\"privately-held\"\" stocks are reduced in the same way. The problem with simply adding stocks to the open market, getting their initial purchase price, is that a larger overall percentage of the company is now on the open market, meaning the \"\"controlling interests\"\" have less control of their company. If at any time the majority of shares are not owned by the controlling interests, then even if they all agree to vote a certain way (for instance, whether or not to merge assets with another company) another entity could buy all the public shares (or convince all existing public shareholders of their point of view) and overrule them. There are various ways to avoid this. The most common is to issue multiple types of stock. Typically, \"\"common\"\" stock carries equal voting rights and equal shares of profits. \"\"Preferred stock\"\" typically trades a higher share of earnings for no voting rights. A company may therefore keep all the \"\"common\"\" stock in private hands and offer only preferred stock on the market. There are other ways to \"\"class\"\" stocks, most of which have a similar tradeoff between earnings percentage and voting percentage (typically by balancing these two you normalize the price of stocks; if one stock had better dividends and more voting weight than another, the other stock would be near-worthless), but companies may create and issue \"\"superstock\"\" to controlling interests to guarantee both profits and control. You'll never see a \"\"superstock\"\" on the open market; where they exist, they are very closely held. But, if a company issues \"\"superstock\"\", the market will see that and the price of their publicly-available \"\"common stock\"\" will depreciate sharply. Another common way to increase market cap without diluting shares is simply to create more shares than you issue publicly; the remainder goes to the current controlling interests. When Facebook solicited outside investment (before it went public), that's basically what happened; the original founders were issued additional shares to maintain controlling interests (though not as significant), balancing the issue of new shares to the investors. The \"\"ideal\"\" form of this is a \"\"stock split\"\"; the company simply multiplies the number of shares it has outstanding by X, and issues X-1 additional shares to each current holder of one share. This effectively divides the price of one share by X, lowering the barrier to purchase a share and thus hopefully driving up demand for the shares overall by making it easier for the average Joe Investor to get their foot in the door. However, issuing shares to controlling interests increases the total number of shares available, decreasing the market value of public shares that much more and reducing the amount of money the company can make from the stock offering.\"", "title": "" }, { "docid": "988f4fdae97c5b24d1cf1782f317b3d1", "text": "\"Share price is based on demand. Assuming the same amount of shares are made available for trade then stocks with a higher demand will have a higher price. So say a company has 1000 shares in total and that company needs to raise $100. They decide to sell 100 shares for $1 to raise their $100. If there is demand for 100 shares for at least $1 then they achieve their goal. But if the market decides the shares in this company are only worth 50 cents then the company only raises $50. So where do they get the other $50 they needed? Well one option is to sell another 100 shares. The dilution comes about because in the first scenario the company retains ownership of 900 or 90% of the equity. In the second scenario it retains ownership of only 800 shares or 80% of the equity. The benefit to the company and shareholders of a higher price is basically just math. Any multiple of shares times a higher price means there is more value to owning those shares. Therefore they can sell fewer shares to raise the same amount. A lot of starts up offer employees shares as part of their remuneration package because cash flow is typically tight when starting a new business. So if you're trying to attract the best and brightest it's easier to offer them shares if they are worth more than those of company with a similar opportunity down the road. Share price can also act as something of a credit score. In that a higher share price \"\"may\"\" reflect a more credit worthy company and therefore \"\"may\"\" make it easier for that company to obtain credit. All else being equal, it also makes it more expensive for a competitor to take over a company the higher the share price. So it can offer some defensive and offensive advantages. All ceteris paribus of course.\"", "title": "" }, { "docid": "b7fc09add0c812c4af7371d7048650c5", "text": "First read mhoran's answer, Then this - If the company sold nothing but refrigerators, and had 40% market share, that's $4M/yr in sales. If they have a 30% profit margin, $1.2M in profit each year. A P/E of 10 would give a stock value totaling $12M, more than the market size. The numbers are related, of course, but one isn't the maximum of the other.", "title": "" }, { "docid": "2bcb59a669749520116928bbb4a071bc", "text": "Because growth and earnings are going down exponentially for this company? It will eventually go up (like 3 years+), but if you want to feel more pain first, go ahead. Look at the macroeconomic picture before you praise all mighty of an individual company", "title": "" }, { "docid": "e44598dada0a8ebf91496f7b40fd3b2c", "text": "Shares are partial ownership of the company. A company can issue (not create) more of the shares it owns at any time, to anyone, at any price -- subject to antitrust and similar regulations. If they wanted to, for example, flat-out give 10% of their retained interest to charity, they could do so. It shouldn't substantially affect the stock's trading for others unless there's a completely irrational demand for shares.", "title": "" }, { "docid": "d22e351c9ec928739d7ed725da136615", "text": "How is it possible that a publicly traded investment company's net asset value per share is higher than their share price? Wouldn't you (in theory) be able to buy the company and liquidate it to make a profit of (NAV/share - price/share)number of shares, ignoring transaction costs and such? I realize that since part of their portfolio is in private equity, NAV is hard to calculate and hard to liquidate as well, but it doesn't really seem to make sense to me. Would love some input. The company I'm talking about in this instance is 180 Degree Capital Corp, but this isn't the first time I've seen this.", "title": "" }, { "docid": "04ec120e0fd5643d3973311263ebe429", "text": "\"Often you are right, and the current information is \"\"priced in\"\", but I would say in times of market boom like this that the market can definitely overprice. Price is driven by trades/last trade. Someone may be willing to pay X, and do so, making the price now X, but that does not mean it is worth X. You could very well be paying a premium for it's perceived desirability. This is why investors/analysts spend time and energy on valuations, they want to compare the markets current price to what the price theoretically should/would be if it were purely driven by the data, in effect trying to remove sentiment from the equation to gain a more realistic idea of what a company is worth. Side note adding on that, don't mistake this as saying one should pay a lot of attention to analysts or their price targets, though analysts do have insightful things to say.\"", "title": "" }, { "docid": "e2a55f72e33c1fb35410907b607ba32d", "text": "\"Rational shareholders wouldn't accept such an offer. The company making the offer is simply trying to get a deal with questionable — though not illegal — tactics. Your answer is actually in the link you provided. Quoting from the fourth paragraph [emphasis is mine]: The SEC has cautioned investors about mini-tender offers, noting that \"\"[s]ome bidders make mini-tender offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price.\"\" The SEC's tips for investors regarding mini-tender offers may be found on the SEC's Web site at http://www.sec.gov/investor/pubs/minitend.htm. There's a lot more information at the SEC web page mentioned. One part I'll highlight from the SEC web page mentions another reason for a mini-tender: Investors need to scrutinize mini-tender offers carefully. Some bidders make mini-tender offers at below-market prices, hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price. Others make mini-tender offers at a premium – betting that the market price will rise before the offer closes and then extending the offer until it does or improperly canceling if it doesn't. You'll also find a lot more information at Wikipedia - Mini-tender offer.\"", "title": "" }, { "docid": "3d8dba8e9987f3172b1977f28b4635e7", "text": "Its Price/Earnings, or P/E, is at (roughly) 96 That means that for EVERY $1 that Amazon makes in profit, people are willing to pay $96 for it. This also means that for every $1 I invest in Amazon, I'll have to wait 96 years until I've collected on that - and that's assuming that 100% of their profit goes out through dividends, something that Amazon doesn't give out. This is either because the stock price is really high, or because its earnings is LOW. Is this kind of ridiculous P/E common among the US stock (I'm not from the US)? Is there something going on in Amazon? Am I missing something (I'm a little new myself)? I'm looking at [this graph](http://i.imgur.com/4YpDH.png). Return on Equity (aka RoE) has been going down. This is either because it has added more shareholders equity (equity issuance?), OR it's because net income has been falling. When you compare this to the rising P/E this recent year, something tells me that something is screwed up. People have been valuing Amazon more and more, while Amazon has been providing less and less* to its shareholders! [Here's more statistics](http://i.imgur.com/kJjPW.png) showing profit margin going down the last year, while the valuation went up (though it has been falling as it maxed at P/E 113). So, either I've missed something (some awesome news or whatever), or I'm uneducated, or this stock has been overvalued. I'm assuming that it probably was a mix of the first and the last, and that this is just a correction. Correct me if I'm wrong.", "title": "" }, { "docid": "bbd64c5d149c47a4026c6066062e4842", "text": "Microsoft wants to buy a majority in the stock. To accomplish that, they have to offer a good price, so the current share owners are willing to sell. Just because the CEO of LinkedIN agreed to the deal doesn't really mean much, only that he is willing to sell his shares at that price. If he does not own 50%, he basically cannot complete the deal; other willing sellers are needed. If Microsoft could buy 50+% of the shares for the current market price, they would have just done that, without any negotiations. That is called a hostile take-over.", "title": "" } ]	fiqa
18dd095d825478b5c723908a236bda51	How do used vehicle exchange programs at car dealerships work?	[ { "docid": "d1f1aa4fd1d65fa135ec33d4155d334c", "text": "\"You are correct to be wary. Car dealerships make money selling cars, and use many tactics and advertisements to entice you to come into their showroom. \"\"We are in desperate need of [insert your make, model, year and color]! We have several people who want that exact car you have! Come in and sell it to us and buy a new car at a great price! We'll give you so much money on your trade in!\"\" In reality, they play a shell game and have you focus on your monthly payment. By extending the loan to 4 or 5 years (or longer), they can make your monthly payment lower, sure, but the total amount paid is much higher. You're right: it's not in your best interest. Buy a car and drive it into the ground. Being free of car payments is a luxury!\"", "title": "" }, { "docid": "ba52e2de758b83fa4bbace296bc92660", "text": "\"Yikes! Not always is this the case... For example, you purchased a new car with an interest rate of 5-6%or even higher... Why pay that much interest throughout the loan. Sometimes trading in the vehicle at a lower rate will get you a lower or sometimes the same payment even with an upgraded (newer/safer technology) design. The trade off? When going from New to New, the car may depreciate faster than what you would save from the interest savings on a new loan. Sometimes the tactics used to get you back to the dealership could be a little harsh, but if you do your research long before you inquire, you may come out on the winning end. Look at what you're paying in interest and consider it a \"\"re-finance\"\" of your car but taking advantage of the manufacturer's low apr special to off-set the costs.\"", "title": "" } ]	[ { "docid": "ca41100d583073f7e920e91d5bf8d4b2", "text": "If the discount is only for financed car then their software application should have accepted the payment (electronic transfer ID) from financed bank. In this case the bank should have given the payment on behalf of your son. I believe the dealer know in advance about the paper work and deal they were doing with your son. Financing a car is a big process between dealer and bank.", "title": "" }, { "docid": "3cb703e814782a743951ba7064011bcc", "text": "\"Once the examination is done, it is recommended to begin calling around to different purchasers. The most solid reestablished auto purchasers are scrap auto evacuation organizations, scrap terraces, and \"\"money for autos\"\" administrations. These are the parts that compensation the most for rescued, assaulted, and trashed vehicles and furthermore give junk car quote. It is critical to contact a few associations, additionally in the event that they are not in your general vicinity. This sort of research will offer you a thought for the going rate of the piece vehicle you have and the condition it stays in; at that point you could unquestionably recognize reasonable offers and forthcoming cheats. They ended up being the best cash for Cars Company.\"", "title": "" }, { "docid": "b1b626a6a93f933925f5e3d6ad2d08dd", "text": "\"I bought a car a few years ago. The salesman had the order, I knew the car I wanted and we had a price agreed on. When I refused the payment plan/loan, his manager came over and did a hard sell. \"\"99% of buyers take the financing\"\" was the best he could do. I told him I was going to be part of the 1%. With rates so low, his 2 or 3% offer was higher than my own cost of money. He went so far as to say that I could just pay it off the first month. Last, instead of accepting a personal check and letting me pick up the car after it cleared, he insisted on a bank check to start the registration process. (This was an example of one dealer, illustrating the point.) In other cases, for a TV, a big box store (e.g. Best Buy) isn't going to deal for cash, but a small privately owned \"\"mom and pop\"\" shop might. The fees they are charged are pretty fixed, they don't pay a higher fee cause I get 2% cash back, vs your mastercard that might offer less.\"", "title": "" }, { "docid": "40b2b3a47d011c6b8410fc6fae9440ff", "text": "I have used car buying services through Costco and USAA. Twice with a Ford, and once with a Honda. In all instances I was directed to sales people that were uncommonly friendly and pleasant to work with. I was given a deep discount without any negotiation. In two of the three cases I did not have a trade. In one case I had a trade, and negotiated a deeper discount then was originally offered. Did I get a good deal? Eh, who knows? Really it depends what your goal is. If your goal is to avoid negotiation, avoid idiot salesmen, and receive a good discount then a quality car buying service may be for you. My research, a few years old, indicated Costco's program was better then the USAA one. If your goal is get a deep as a discount as possible on a new car, well then you have some work cut out for you. Keep some hand sanitizer handy when you meet one of the slime ball salesmen. Keep in mind that not everyone understand the difference between the words value and cheap. If your goal is to pay as little as possible for quality transportation. Avoid most dealers and new cars. But I don't think that is what you are looking for.", "title": "" }, { "docid": "23b8bff4fa7c1d2e778dcb1d51bd059e", "text": "Let's say Tommy has a really awesome Mom. She packs Oreos with Tommy's lunch, and every. Single. Day. You're on the school meal plan, and get that boring old doughnut or jelly from the cafeteria daily as part of your lunch plan. You would really rather have Oreos. For some reason, Tommy hates Oreos, but has a real hankering for the cafeteria dessert of the day. You seek out a mutual friend, and Alice, and tell her that you wished your mom was as awesome as Tommy's mom. Alice knows about Tommy's opposite predicament. So Alice says, why dont you pass me your cafeteria dessert every day, and ill pass you a packet of Oreos in return. Never one to turn down a sweet (pardon the pun) deal, you and Alice shake on it. Before the day is out, Alice finds Tommy and makes a similar deal with him. Ive just described a swap transaction. Two corporates, you and Tommy, seek out a swap dealer (usually a bank or broker) who makes two back to back transactions that offsets the position on the dealer's books. They collect a fee, in terms of the bid/ask spread that they quote to the corporations. If you would like to know more about the details, feel free to drop a reply. I work on swap pricing daily as part of my job and would be happy to answer.", "title": "" }, { "docid": "ab573c1f875dcbc6bc45473c81083849", "text": "\"A while back I sold cars for a living. Over the course of 4 years I worked for 3 different dealerships. I sold new cars at 2 and used at the last one. When selling new cars I found that the majority of people buying the higher end cars honestly shouldn't have been - 80%+. They almost always came in owing more on their trades then they were worth, put down very little cash and were close to being financially strapped. From a financial perspective these deals were hard to close, not because the buyer was picky but rather because their finances were a mess. Fully half, and probably more, we had to switch from the car they initially wanted down to a much cheaper version or try to convert to a lease because it was the only way the bank would loan the money. We called them \"\"$30,000 millionaires\"\" because they didn't make a whole lot but tried to look like they did. As a salesman you knew you were in serious trouble when they didn't even try to negotiate. Around 2% of the deals I did were actual cash deals - meaning honest cash, not those who came in with a pre-approved loan from a bank. These were invariably for used cars about 3 to 4 years old and they never had a trade in. The people doing this always looked comfortable but never dressed up, you wouldn't even look at them twice. The negotiations were hard because they knew exactly how much that car should go for and wouldn't even pay that. It was obvious they knew the value of money. That said, I've been in the top 3% of wage earners for about 20 years and at no point have I considered myself in a position to \"\"afford\"\" a new \"\"luxury\"\" car. IMHO, there are far more important things you can do with that kind of money.\"", "title": "" }, { "docid": "f2fb9241d4e6bab34de55154a4b9bb8d", "text": "When the 2016 models come out, the dealership marks down the 2015 model and then it sells pretty fast. The process doesn't take that long in the car market because the 2015 models are just as good as the 2016 so if they are just a little cheaper, they will sell quickly. If you want a 2008 Audi that has never sold, you are going to be looking for a long time. The same thing happens in every industry. Where are the older versions of digital cameras? Cell phones? Blenders? Digital pianos? Any item that changes from year to year sits on shelves for a little while after its replacement comes out until the retailer reduces its price by enough and it sells. The only exceptions are goods that depreciate very quickly or go bad, which are recycled or thrown away (like fresh produce, for example). It seems kind of crazy at first that essentially all goods that are produced by the economy are consumed, but that's the magic of capitalism: prices make markets clear.", "title": "" }, { "docid": "7059a7d0bfe3ad4e22effcd4c6298c90", "text": "I have a few recommendations/comments: The trick here is to make it clear to the dealer that you will not be getting a new car from them and their only hope of making some money is to sell you your own car. You need to be prepared to walk away and follow through. DON'T buy a new car from them even if you end up turning it in! They could still come back a day later and offer a deal. Leasing a new car every 3 years is not the best use of money. You have to really, really like that new car feeling every three years and be willing to pay a premium for it. If you're a car nut (like me) and want to spend money on a luxury car, it's far wiser to purchase a slightly used luxury vehicle, keep it for 8+ years, and that way you won't have a car payment half the time!", "title": "" }, { "docid": "c03c89b9c8a7b1f7dc27747751e1c316", "text": "\"This is completely disgusting, utterly unethical, deeply objectionable, and yes, it is almost certainly illegal. The Federal Trade Commission has indeed filed suit, halted ads, etc in a number of cases - but these likely only represent a tiny percentage of all cases. This doesn't make what the car dealer's do ok, but don't expect the SWAT team to bust some heads any time soon - which is kind of sad, but let's deal with the details. Let's see what the Federal Trade Commission has to say in their article, Are Car Ads Taking You for a Ride? Deceptive Car Ads Here are some claims that may be deceptive — and why: Vehicles are available at a specific low price or for a specific discount What may be missing: The low price is after a downpayment, often thousands of dollars, plus other fees, like taxes, licensing and document fees, on approved credit. Other pitches: The discount is only for a pricey, fully-loaded model; or the reduced price or discount offered might depend on qualifications like the buyer being a recent college graduate or having an account at a particular bank. “Only $99/Month” What may be missing: The advertised payments are temporary “teaser” payments. Payments for the rest of the loan term are much higher. A variation on this pitch: You will owe a balloon payment — usually thousands of dollars — at the end of the term. So both of these are what the FTC explicitly says are deceptive practices. Has the FTC taken action in cases similar to this? Yes, they have: “If auto dealers make advertising claims in headlines, they can’t take them away in fine print,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “These actions show there is a financial cost for violating FTC orders.” In the case referenced above, the owners of a 20+ dealership chain was hit with about $250,000 in fines. If you think that's a tiny portion of the unethical gains they made from those ads in the time they were running, I'd say you were absolutely correct and that's little more than a \"\"cost of doing business\"\" for unscrupulous companies. But that's the state of the US nation at this time, and so we are left with \"\"caveat emptor\"\" as a guiding principle. What can you do about it? Competitors are technically allowed to file suit for deceptive business practices, so if you know any honest dealers in the area you can tip them off about it (try saying that out loud with a serious face). But even better, you can contact the FTC and file a formal complaint online. I wouldn't expect the world to change for your complaint, but even if it just generates a letter it may be enough to let a company know someone is watching - and if they are a big business, they might actually get into a little bit of trouble.\"", "title": "" }, { "docid": "d9c0885f99984679d899289342d7c883", "text": "\"Uh, you want to lease a car through a dealer? That is the worst possible way to obtain a car. Dealers love leases because it allows them to sell a car for an unnegotiated price and to hide additional fees. It's the most profitable kind of sale for them. The best option would be to buy a used car off of Craigslist or eBay, then sell it again the same way when you leave. If you sell the car for what you paid, then you get the car for a year for free. If you are determined to go through with the expensive, risky and annoying plan of leasing a car, then you should use a leasing agent. I recommend reading some car buying guides before going out into the wilderness with the tigers and bears. Comment on Leasing Tricks Don't get tricked by the \"\"interest rate\"\" game. The whole interest thing is just a distraction to trick you into think you are getting some kind of reasonable deal. The leasing company makes most of their money from fees. For example, if you get into an accident it is a big payday for them. The average person thinks they will never get into an accident, but the reality is that most people get into an accident sooner or later. They also collect big penalties for \"\"maintenance failures\"\". Forget to change the oil? BOOM! money. Forget to comply with manufacture recall? BOOM! more money. Forget to do the annual service? BOOM! more money. Scratch the car? BOOM! more money. The original car mats are missing? BOOM! you just paid $400 for a set of mats that cost the leasing company $25 bucks. The leasing company is counting on the fact that 99% of people will not maintain the car correctly or will damage it in some way. They also usually have all kinds of other bogus fees, so-called \"\"walk-away fees\"\", \"\"disposition fees\"\", \"\"initiation fees\"\". Whatever they think they can get away with. The whole system is calculated to screw you.\"", "title": "" }, { "docid": "df6212d4d0d3342b5759dd5e3439f857", "text": "You mean auto dealer bailouts? Has happened multiple times already. Also dealerships have been doing this type of lending with banks for years.. which is why direct sales is likely a mu have better model than dealership model...but hey I didn't invent this.", "title": "" }, { "docid": "632388c8f62673fbddf521371558aa2d", "text": "\"There are two fundamentally different reasons merchants will give cash discounts. One is that they will not have to pay interchange fees on cash (or pay much lower fees on no-reward debit cards). Gas stations in my home state of NJ already universally offer different cash and credit prices. Costco will not even take Visa and MasterCard credit cards (debit only) for this reason. The second reason, not often talked about but widely known amongst smaller merchants, is that they can fail to declare the sale (or claim a smaller portion of the sale) to the authorities in order to reduce their tax liability. Obviously the larger stores will not risk their jobs for this, but smaller owner-operated (\"\"mom and pop\"\") stores often will. This applies to both reduced sales tax liability and income tax liability. This used to be more limited per sale (but more widespread overall), since tax authorities would look closely for a mismatch between declared income and spending, but with an ever-larger proportion of customers paying by credit card, merchants can take a bigger chunk of their cash sales off the books without drawing too much suspicion. Both of the above are more applicable to TVs than cars, since (1) car salesmen make substantial money from offering financing and (2) all cars must be registered with the state, so alternative records of sales abound. Also, car prices tend to be at or near the credit limit of most cards, so it is not as common to pay for them in this way.\"", "title": "" }, { "docid": "2bb4e06785887fbf93def08101666f95", "text": "\"For the future: NEVER buy a car based on the payment. When dealers start negotiating, they always try to have you focus on the monthly payment. This allows them to change the numbers for your trade, the price they are selling the car for, etc so that they maximize the amount of money they can get. To combat this you need to educate yourself on how much total money you are willing to spend for the vehicle, then, if you need financing, figure out what that actually works out to on a monthly basis. NEVER take out a 6 year loan. Especially on a used car. If you can't afford a used car with at most a 3 year note (paying cash is much better) then you can't really afford that car. The longer the note term, the more money you are throwing away in interest. You could have simply bought a much cheaper car, drove it for a couple years, then paid CASH for a new(er) one with the money you saved. Now, as to the amount you are \"\"upside down\"\" and that you are looking at new cars. $1400 isn't really that bad. (note: Yes you were taken to the cleaners.) Someone mentioned that banks will sometimes loan up to 20% above MSRP. This is true depending on your credit, but it's a very bad idea because you are purposely putting yourself in the exact same position (worse actually). However, you shouldn't need to worry about that. It is trivial to negotiate such that you pay less than sticker for a new car while trading yours in, even with that deficit. Markup on vehicles is pretty insane. When I sold, it was usually around 20% for foreign and up to 30% for domestic: that leaves a lot of wiggle room. When buying a used car, most dealers ask for at least $3k more than what they bought them for... Sometimes much more than that depending on blue book (loan) value or what they managed to talk the previous owner out of. Either way, a purchase can swallow that $1400 without making it worse. Buy accordingly.\"", "title": "" }, { "docid": "1e6eb016af05fc0458721777ea42af46", "text": "I am currently a college student and as a part time hobby/business I buy used cars from bank repossesions and flip them. In the past three months I have noticed brand new cars (less than 5000 miles on them) flood the local auctions.", "title": "" }, { "docid": "2f2b3bea16a194d79cea04a22815d518", "text": "449 of the 500 companies in the S&P 500 used 54% of their earnings to buy back shares for over $2 trillion. Rather than invest in development, capital, human capital, bigger dividends, they're repurchasing shares to boost their EPS and increase share value in the short term. Why is this an issue? Because it shows that these companies are uneasy about the long term. It stunts growth. Doesn't have to be research, simply expansion or rewarding employees/shareholders. Employees of the company receive no benefits and bagholders may make a quick buck short term, but suffer long. Execs of the company however get fat AF checks for hitting target ratios and price. Stock buybacks enable this.", "title": "" } ]	fiqa
8ab8631187946b89d9c552be9196c78e	Need a loan to buy property in India. What are my options?	[ { "docid": "771b3ef9123685092fecea10e0ef20d8", "text": "Getting the line of credit would likely be a bit easier than the loan but realistically the best option is getting a mortgage through an Indian bank. With a long term mortgage your monthly payments would be a small portion of your income (maybe as low as $500) so currency fluctuations are likely to be minor blips that you can avoid by sending a few thousand to hold as a cushion for when exchange is unfavorable. Edit: Please be advised that mortgages work differently throughout the world. While 10% down may be standard in the US, in India 40-50% down seems to be the norm.", "title": "" }, { "docid": "883d134f61cddb84218d0b560ffc0de3", "text": "There are P2P lending sites like prosper.com and lendingclub.com (both have 35K limit) where you can take out a personal loan. Don't expect the rate to be nowhere close to a secured loan like a mortgage or a car loan.", "title": "" }, { "docid": "32c41f3ceddd2b15e339c306af49cfd8", "text": "In USA, if you take a personal loan, you will probably get rates between 8-19%. It is better that you take a loan in India, as home loan rates are about 10.25%(10.15% is the lowest offered by SBI). This might not be part of the answer, but it is safer to hold USD than Indian rupees as India is inflating so much that the value of the rupee is always going lower(See 1970 when you could buy 1 dollar for 7 rupees). There might be price fluctuations where the rupee gains against the dollar, but in the long run, I think the dollar has much more value(Just a personal opinion). And since you are taking a home loan, I am assuming it will be somewhere between 10-20 years. So, you would actually save a lot more on the depreciating rupee, than you would pay interest. Yes, if you can get a home loan in USA at around 4%, it would definitely be worth considering, but I doubt they will do that since they would not know the actual value of the property. Coming to answer your question, getting a personal loan for 75k without keeping any security is highly unlikely. What you can do since you have a good credit score, is get a line of credit for 20-25k as a backup, and use that money to pay your EMI only when absolutely required. That way, you build your credit in the United States, and have a backup for around 2 years in India in case you fail to pay up. Moreover, Line of credits charge you interest only on the amount, you use. Cheers!", "title": "" } ]	[ { "docid": "49b52fa20a3fd890838958f5ba4230e0", "text": "I use xoom.com to transfer money to India. I've been using them for over 2 years now, they are the fastest and the cheapest for me (the funds are usually available the same day). They seem to have added a lot of European countries to their list. Definitely worth a shot.", "title": "" }, { "docid": "c250eb615243f98ddef97cbc801dfbae", "text": "A few weeks ago, I was thinking about this exact thing (except swap Euros for Canadian Dollars). The good news is that there are options. Option 1: yes, buy Indian fixed deposits Interest rates are high right now- you can get up to 9% p.a. It boils down to your sentiment about the Indian rupee going forward. For instance, let's say you purchase a deposit for amount x at 9% p.a., you can have it double to almost 2x in 10 years. Three things can happen in 10 years: Are you optimistic about Indian governance and economy going forward? If you are, go for it! I certainly am. Option 2: heard of FCNR? Look in to FCNR deposits. I don't know about Europe, but in Canada, the best rate for a 1 year deposit is approximately 1.5%. However, through Foreign Currency Non-Resident (FCNR) deposits, you can get up to 4% or 5%. The other benefit is that you don't have to convert currency to INR which results in conversion savings. However, only major currencies can be used to open such accounts.", "title": "" }, { "docid": "af5fa73a378d3cb8c758b0030f400d24", "text": "A better idea if applicable is to borrow 50K (max allowed) to buy a house and pay interest to yourself instead of a bank. And none of that origination and closing fees lost to the lender", "title": "" }, { "docid": "2c733ed11fa81897066eedb0e3e07ccf", "text": "You are neglecting a few very important things around real estate transactions in Belgium So in the end a 300K building may cost you more than 340K, let's take some unexpected costs into account and use 350K for remainder of calculation. Even worse if it's newly built (which I doubt) the first percentage is 21% (VAT) instead of 10%. All these costs can be checked on the useful site www.hoeveelkostmijnhuis.be Now, aside from that most banks will and actually have to demand you pay part of all this yourself. So you can't do 560K (or 570K now). Mostly banks will only finance up to about 90% of the value of the building, so 90% of 300K, which is 270K (554K), the other 80K (516K) you have to pay yourselves. But it could be the bank goes as low as 80%. Another part to complicate the loan is how much you can pay a month. Since the mortgage crisis they're very strict on this. There are lots of banks that will not allow you to make monthly payments of more than 33% of your monthly income when you are going to live there. This is a nuisance even when buying one house, you want to buy 2. Odds seem low they'll accept high monthly payments because you either need an additional loan or need to pay rent, so don't count on a 5y deal. Now this is all based on a single loan, it will probably be a bit different with multiple loans. However, it is unlikely any bank will accept this, even if all loans are with the same bank. You need to consider the basics of a real-estate loan: A bank trusts you can pay it off and if not they can seize the real-estate hoping to regain their initial investment. It's very hard to seize a complete asset if only one out of 5 loan-takers defected. You could maybe do this with another less restrictive/higher risk type of loan but rates will be a lot higher (think 5-6% instead of 1.5%). And don't underestimate the running costs: for that price and 5 rooms in that city you're likely looking at an older building. Expect lots of cost for maintenance and keeping the building according to code. Also expect costs for repairs (you rent to students...). You'll also have to pay quite a bit of money on insurances and of course on real estate taxes (which are average in Ghent). Also factor in that currently there is not a housing shortage for Ghent students so you might not always have a guaranteed occupation. Also take into account responsibility: if a fire breaks out or the house collapses or a gas leak occurs, you might be sued. It doesn't matter if you're at fault, it's costly and a big nuisance. Simply because you didn't think of any of this: don't do this. It's better to invest in real estate funds. But if you still think you can do better then all the landlords Ghent is riddled with, don't do it as a personal investment. Create a BVBA, put some investment in here (like 10-20K each), approach a bank with a serious business plan to get the rest of the money as a loan (towards a single entity - your BVBA) and get things going. When the money comes in you can either give yourselves a salary or pay out profits on the shares. You may be confused about how rich you can become because we as a nation tend to overestimate the profitability of real estate. It's really not that much better than other investments (otherwise everybody would only invest in real estate funds). There are a few things that skew our vision however:", "title": "" }, { "docid": "4d4b5ef609c1359642f850d7a2d9e79c", "text": "I assume that there is proper documentation. Loan can only be credited to your NRO account. See RBI regulation Persons Resident in India borrowing in INR from NRIs/PIOs 2.1 Available routes for borrowing: Persons resident in Indian may borrow in INR from NRIs/PIOs under the following two routes: 2.1.1 Borrowing in INR by persons other than companies in India: A person resident in India, not being a company incorporated in India, may borrow in INR from NRIs/PIOs after satisfying the following terms and conditions: Borrowing shall be only on a non- repatriation basis; The amount of loan should be received either by inward remittance from outside India or by debit to NRE/NRO/FCNR(B)/NRNR/NRSR account of the lender, maintained with an authorised dealer or an authorised bank in India; Period of loan shall not exceed 3 years; Rate of interest on the loan shall not be more than two per cent above Bank Rate prevailing on the date of availment of loan; Payment of interest and repayment of principal shall be made only to the NRO account of the lender.", "title": "" }, { "docid": "8daccb4c7d1963417fafccde3f1149a4", "text": "There are many property management companies are available in India. You can easily find trusted companies just searching on the google. They manage all these things legally. You just try this", "title": "" }, { "docid": "1f5747cf4bc4955f3b1a7492034f2a17", "text": "\"With permanent contract in Germany you shouldn't have any problem getting a loan. It's even more important than how much do you earn. Generally, you should ask for a house mortgage (Baufinanzierungsdarlehen) with annuity as a type of credit to save on interest. Besides, you usually get a better conditions with a saving bank (Sparkasse) or a popular bank (Volksbank) situated in the area where your house is situated. You also shouldn't combine your credit with extra products (the simpler is the product, the better is for you), maybe I'll write later an extra piece on the common pitfalls in this regard. Probably, you could find a bank that would give you such a loan, but it would be very expensive. You should save at least 40%, because then the bank can refinance your loan cheaply and in return offer you a low interest. Taxes depend heavily on the place where you buy a house. When you buy it, you pay a tax between 3.5% and 6% (look up here). Then you pay a property tax (Grundsteuer), it depends on community how much do you pay, the leverage is called Hebesatz (here's example). Notary would cost ca. 1.5% of the house price. All and all, you should calculate with 10% A country-independent advice: if you want to save on interest in the long run, you should take an annuity loan with the shortest maturity. Pay attention to effective interest rate. Now to Germany specifics. Don't forget to ask about \"\"Sondertilgung\"\" (extra amortization) - an option to amortize additionaly. Usually, banks offer 5% Sondertilgung p.a. The interest-rate is usually fixed for 8 years (however, ask about it), this period is called Zinsbindung. It sound ridiculous, but in southern lands (Bayern, Baden-Württemberg) you usually get better conditions as in Berlin or Bremen. The gap could be as big as 0.5% p.a. of effective interest rate! In Germany they often use so-called \"\"anfängliche Tilgung\"\" (initial rate of amortizazion) as a parameter.\"", "title": "" }, { "docid": "230984d1dc54df5eba50d8d40e9b1046", "text": "Most likely, this will not work they way you think. First things first, to get a loan, the bank needs to accept your collateral. Note that this is not directly related to the question what you plan to do with the loan. Example: you have a portfolio of stocks and bonds worth USD 2 million. The bank decides to give you a loan of USD 1 million against that collateral. The bank doesn't care if you will use the loan to invest in foreign RE or use it up in a casino, it has your collateral as safety. So, from the way you describe it, I take it you don't have the necessary local collateral but you wish to use your foreign investments as such. In this case it really doesn't matter where you live or where you incorporate a company, the bank will only give you the loan if it accepts the foreign collateral. From professional experience with this exact question I can tell you, there are very few banks that will lend against foreign property. And there are even less banks, if any, that will lend against foreign projects. To sum it up: Just forget banks. You might find a private lender to help you out but it will cost you dearly. The best option you have is to find a strategic partner who can cough up the money you need but since he is taking the bigger risk, he will also take the bigger profit share.", "title": "" }, { "docid": "5066c4221e90ea69f47c74d8a2b64d9e", "text": "Loan Service Providers in Delhi & NCR, Get contact details offering various Loans to customers from many Banks. Loan Against Property can get you a higher loan amount for your business or personal needs with the benefit of lower EMI.", "title": "" }, { "docid": "148655328c8d30bc3d0e2bb245e2a408", "text": "I think a greater problem would be the protection of your property right. China hasn't shown much respect for the property rights of its own citizens - moving people off subsistence farms in order to build high-rise apartments - so I'm not certain that a foreigner could expect much protection. A first consideration in any asset purchase should always be consideration of the strength of local property law. By all accounts, China fails.", "title": "" }, { "docid": "ddf52fea02a2127de2b6cecea9f0f877", "text": "\"Most personal loans in the US are for the purpose of purchasing some tangible object (usually a house or car) and that object is the collateral for the loan. Indeed, the loan proceeds are usually paid directly to the seller without passing through the bank account of the borrower, and the seller delivers the title of the car to the lender, or a mortgage lien is recorded on the real property. Except possibly in the case of a refinance of a home mortgage, there is not much cash from such a loan to send to a friend to invest in his business, whether in the US or in India. These types of loans are \"\"relatively easy\"\" to get. Much harder to get are unsecured personal loans. Unless your friend has a very friendly banker, getting an unsecured loan of, say, $20,000 \"\"just for the heck of it\"\" is not easy. Some reasonably well-off people do manage to get such loans and use the money to invest in the stock or bond markets, in which case, the interest paid on such loans can be deducted on Schedule A (but only to the extent of the actual investment income; any extras can be carried over to the next year). So, will your friend be investing in your business or making a loan to your business? and do you anticipate that your business will generate any investment income or interest for your friend? If not, and your friend still wants to finance your business (while making payments on the loan in the US), then your friend must really like you a lot (or have faith that a few years down the road, you will be able to sell your business to GoAppTel for mucho big bucks and pay him off very handsomely).\"", "title": "" }, { "docid": "dcd078fe91aeb1d88cef0d943fde3e12", "text": "In India, where I live, you can: In addition, housing loans are given priority status as well - bank capital requirements on housing loans is lower than for, say, a corporate loan or a loan against other kinds of collateral. That makes housing loans cheaper as well - you get a home loan at around 10% in India versus 15% against most other assets, and since you can deduct it against tax, the effective interest rate is even lower. Housing in India is unaffordable too, if you're wondering. In a suburb 40 Km away from Delhi, a 2000 sq. foot apartment, about 1500 sq. ft. of carpet area, with no appliances costs about USD 250,000.", "title": "" }, { "docid": "6df5d9c36f576d1268036e98f7e8ccf1", "text": "First off, I would question why do you need a LI policy? While you may be single are you supporting anyone? If not, and you have some money saved to cover a funeral; or, your next of kin would be able to pay for final expenses then you probably don't have a need. In, general, LI is a bad investment vehicle. I do not know hardly anything about the Indian personal finance picture, but here in the US, agents tout LI as a wonderful investment. This can be translated as they make large commissions on such products. Here in the US one is far better off buying a term product, and investing money elsewhere. I image it is similar in India. Next time if you want to help a friend, listen to his sales presentation, give some feedback, and hand him some cash. It is a lot cheaper in the long run.", "title": "" }, { "docid": "a0431fb5aa87250212e86062c179f49d", "text": "The suggestion may be very delayed, have you personally gone to the Experian Office with all the documentation (in xerox copy and in original)? If not, please do so, there is always a difference between dealing with govt/semi-govt institutions over electronic channels and in person.", "title": "" }, { "docid": "bee4d2ec69a0fd1cb331ff5ed33ed0ef", "text": "\"Any sensible lender will require a lean lien against your formerly-free-and-clear property, and will likely require an appraisal of the property. The lender is free to reject the deal if the house is in any way not fitting their underwriting requirements; examples of such situations would be if the house is in a flood/emergency zone, in a declining area, an unusual property (and therefore hard to compare to other properties), not in salable condition (so even if they foreclose on it they'd have a questionable ability to get their money back), and so forth. Some lenders won't accept mobile homes (manufactured housing) as collateral, for instance, and also if the lender agrees they may also require insurance on the property to be maintained so they can ensure that a terrible fate doesn't befall both properties at one time (as happens occasionally). On the downside, in my experience (in the US) lenders will often require a lower loan percentage than a comparable cash down deal. An example I encountered was that the lender would happily provide 90% loan-to-value if a cash down payment was provided, but would not go above 75% LTV if real estate was provided instead. These sort of deals are especially common in cases of new construction, where people often own the land outright and want to use it as collateral for the building of a home on that same land, but it's not uncommon in any case (just less common than cash down deals). Depending on where you live and where you want to buy vs where the property you already own is located, I'd suggest just directly talking to where you want to first consider getting a quote for financing. This is not an especially exotic transaction, so the loan officer should be able to direct you if they accept such deals and what their conditions are for such arrangements. On the upside, many lenders still treat the LTV% to calculate their rate quote the same no matter where the \"\"down payment\"\" is coming from, with the lower the LTV the lower the interest rate they'll be willing to quote. Some lenders might not, and some might require extra closing fees - you may need to shop around. You might also want to get a comparative quote on getting a direct mortgage on the old property and putting the cash as down payment on the new property, thus keeping the two properties legally separate and giving you some \"\"walk away\"\" options that aren't possible otherwise. I'd advise you to talk with your lenders directly and shop around a few places and see how the two alternatives compare. They might be similar, or one might be a hugely better deal! Underwriting requirements can change quickly and can vary even within individual regions, so it's not really possible to say once-and-for-all which is the better way to go.\"", "title": "" } ]	fiqa
d6e0b6366f2310f12fca28863d46449a	I'm upside down on my car loan and need a different car, what can I do?	[ { "docid": "8cd2b0cad322b4f13659c8aa60ac7af7", "text": "There are a few things you should keep in mind when getting another vehicle: DON'T use dealership financing. Get an idea of the price range you're looking for, and go to your local bank or find a local credit union and get a pre-approval for a loan amount (that will also let you know what kind of interest rates you'll get). Your credit score is high enough that you shouldn't have any problems securing a decent APR. Check your financing institution's rules on financing beyond the vehicle's value. The CU that refinanced my car noted that between 100% and 120% of the vehicle's value means an additional 2% APR for the life of the loan. Value between 120% and 130% incurred an additional 3% APR. Your goal here is to have the total amount of the loan less than or equal to the value of the car through the sale / trade-in of your current vehicle, and paying off whatever's left out of pocket (either as a down-payment, or simply paying off the existing loan). If you can't manage that, then you're looking at immediately being upside-down on the new vehicle, with a potential APR penalty.", "title": "" }, { "docid": "3f033ab4c1714f26c112ed3af1388189", "text": "I am new to the site and hope I can help! We just purchased a used car a few weeks ago and used dealer's finance again so that's not the issue here. I want to focus on what you can do to resolve your issue and not focus on the mistakes that were made. 1 - DO NOT PURCHASE A NEW CAR! Toyota Camrys are great cars that will last forever. I live in Rochester, NY and all you need is snow tires for the winter as ChrisInEdmonton suggested. This will make a world of difference. Also, when you get a car wash get an under-spray treatment for salt and rust (warm climate cars don't usually come with this treatment). 2 - Focus on paying this loan off. Pay extra to the monthly note, put any bonuses you get to the note. Take lunches to work to save money so you can pay extra. I'm not sure if you put any money down but your monthly note should be around $300? I would try putting $400+ down each month until it is paid off. Anything you can do. But, do not buy a new car until this one is fully paid off! Let me know if this helps! Thanks!", "title": "" }, { "docid": "7665543f728d53114d0388a6ea8c214e", "text": "Dealerships make a lot of money in the finance department. One of the thing they play upon is your emotional reaction of purchasing a new vehicle (new to you in this case). They perform all sorts of shenanigans, like adding undercoat, selling gap insurance, or extended warranties. They entice you with a promise of a lower interest rate, but really what they are trying to do is back you into a payment. So if you can fiance 20,000, but the car you are buying is 16,000, then they will try to move that figure up to the 20K mark. In your case it sounded like some borderline (at the least) illegal activity they used to fool you into paying more. It sounds like you regret this decision which puts you a step ahead of most. How many people brag about the extended warranty or gap insurance they got included in the sale? As mentioned in another answer the best bet is to go into the dealership with financing in place. Say you were able to get a 3% loan on 16K. The total interest would be ~1600. If you avoid the finance room, you might avoid their dubious add ons that would probably cost you more then the 1600 even if you can get 0%. If you are going to buy a car on time, my advice would be to not fill out a credit app at the dealership. The dealership people through a conniption fit, but hold your ground. If need be get up and walk out. They won't let you leave. One thing I must mention, is that one feels very wealthy without that monthly pain in the a$$ payment for a car. You may want to try and envision yourself without a car payment, and make steps to making that a reality for the rest of your life.", "title": "" }, { "docid": "2bb4e06785887fbf93def08101666f95", "text": "\"For the future: NEVER buy a car based on the payment. When dealers start negotiating, they always try to have you focus on the monthly payment. This allows them to change the numbers for your trade, the price they are selling the car for, etc so that they maximize the amount of money they can get. To combat this you need to educate yourself on how much total money you are willing to spend for the vehicle, then, if you need financing, figure out what that actually works out to on a monthly basis. NEVER take out a 6 year loan. Especially on a used car. If you can't afford a used car with at most a 3 year note (paying cash is much better) then you can't really afford that car. The longer the note term, the more money you are throwing away in interest. You could have simply bought a much cheaper car, drove it for a couple years, then paid CASH for a new(er) one with the money you saved. Now, as to the amount you are \"\"upside down\"\" and that you are looking at new cars. $1400 isn't really that bad. (note: Yes you were taken to the cleaners.) Someone mentioned that banks will sometimes loan up to 20% above MSRP. This is true depending on your credit, but it's a very bad idea because you are purposely putting yourself in the exact same position (worse actually). However, you shouldn't need to worry about that. It is trivial to negotiate such that you pay less than sticker for a new car while trading yours in, even with that deficit. Markup on vehicles is pretty insane. When I sold, it was usually around 20% for foreign and up to 30% for domestic: that leaves a lot of wiggle room. When buying a used car, most dealers ask for at least $3k more than what they bought them for... Sometimes much more than that depending on blue book (loan) value or what they managed to talk the previous owner out of. Either way, a purchase can swallow that $1400 without making it worse. Buy accordingly.\"", "title": "" }, { "docid": "6491ab893dce7b203e9d4c43170c194c", "text": "\"Before buying a new car, determine whether you really need one! If there's an automotive discussion, you should ask there FIRST to get opinions on how much all-wheel-drive helps. You may not want to change cars at all. Remember, most of us in the Northeast are NOT driving all-wheel-drive vehicles, and all cars have all-wheel brakes. All-wheel drive is better at getting you moving from a stop if one of the drive wheels would otherwise be slipping. It makes less difference during actual driving. Traction control braking is much more important -- and much more common, hence much cheaper. And probably already present in your Camry. And good tires make a huge difference. (Top-of-the-line all-season tires are adequate, but many folks do switch to snow tires during the winter and switch back again in summer.) Tires -- even if you get a second set of rims to put them on -- are a heck of a lot cheaper than changing cars. Beyond everything else, driving in winter conditions is a matter of careful practice. Most of the time, simply avoiding making sudden starts/stops/turns and not driving like you're in a video arcade (\"\"gotta pass three more or I lose my game!\"\") will do the job. You'll learn the feel of how the car responds. Some basic instruction in how to handle a skid will prepare you for the relatively rare times when that happens. (Some folks actively learn by practicing skids in a nice open parking lot if they can find one; I never have but it makes some sense.) If in doubt about the driving conditions, wait until the roads have been plowed and salted. Remember, teenagers learn to do this, and they're certifiably non compos mentis; if they can do it, you can do it. Before buying a new car, determine whether you really need one!\"", "title": "" } ]	[ { "docid": "78b7e7d1ebadbacbc9ae26e90af8340f", "text": "The first thing that strikes me is: Is this a time-limited offer? Because if you can expect the offer to still be valid in a few weeks, why not just wait that month (which will earn you the money) and buy the car then? The second thing you need to consider is obviously the risk that in the interim, there will be an actual emergency which would require the money that you no longer have. The third thing to consider is whether you need the car now. Do you require a car to get around and your current one is breaking down, perhaps even to the point that repairing it would cost you more than buying a new car and it is currently not safe to drive? If so, compare the cost of repairing to the cost of buying; if the difference is small, and the new car would be more likely to be reliable than the old car after spending the money, then it can make sense to buy a new car and perhaps sell the old one in its current condition to someone who likes to tinker. (Even if you only recover a few hundreds of dollars, that's still money that perhaps you wouldn't otherwise have.) The fourth thing I would consider, especially given the time frame involved, is: Can you get a loan to buy the new car? Even if the interest rate is high, one month's worth of interest expense won't set you back very far, and it will keep the money in your emergency fund for if there is an actual emergency in the weeks ahead. Doing so might be a better choice than to take the money out of the emergency fund, if you have the opportunity; save the emergency fund for when that opportunity does not exist. And of course, without knowing how much you earn, take care to not end up with a car that is no more reliable than what you have now. Without knowing how much you earn and what the car you have in mind would cost, it's hard to say anything for certain, but if the car you have in mind costs less than a month's worth of net pay for you, consider whether it's likely to be reliable. Maybe you are making an absolutely stellar pay and the car will be perfectly fine; but there's that risk. Running the car by a mechanic to have it briefly checked out before buying it may be a wise move, just to make sure that you don't end up with a large car repair expense in a few months when the transmission gives up, for example.", "title": "" }, { "docid": "a2d26997f808375f6f9b0725bb83a7ee", "text": "My family members, particularly my aunt (his daughter), are telling me that when my grandpa dies they are taking my car. Bring this up with Grandpa. If this is what he wants to have happen, then help him make it happen before you finish paying $12,000 on a car worth only $6,000. Let the Aunt and other relatives deal with the remaining $12,000. If that isn't what he wants to have happen, then work out how you and he can legally make sure that what he wants to have happen actually happens. If the Aunt or others bring it up, make sure they understand that you still owe $12,000 on the car, and if they get the car they also get the loan. If they refuse to pay the loan then make sure they know you will cooperate with the bank when they attempt to repossess the car - up to and including providing them with keys and location. This will hurt your credit, and you will be on the hook for the remaining portion of the loan, but you at least won't have to deal with all of it - they'll sell it at auction and your loan amount will fall a little. But the best course of action is to work with Grandpa, and make sure that he understands the family's threats, how that will affect you since you're on the loan, and what options you'd like to pursue.", "title": "" }, { "docid": "06b62f2e839c4409e58c08dab7ad9f74", "text": "1) How long have you had the car? Generally, accounts that last more than a year are kept on your credit report for 7 years, while accounts that last less than a year are only kept about 2 years (IIRC - could someone correct me if that last number is wrong?). 2) Who is the financing through? If it's through a used car dealer, there's a good chance they're not even reporting it to the credit bureaus (I had this happen to me; the dealer promised he'd report the loan so it would help my credit, I made my payments on time every time, and... nothing ever showed up. It pissed me off, because another positive account on my credit report would have really helped my score). Banks and brand name dealers are more likely to report the loan. 3) What are your expected long term gains on the stocks you're considering selling, and will you have to pay capital gains on them when you do sell them? The cost of selling those stocks could possibly be higher than the gain from paying off the car, so you'll want to run the numbers for a couple different scenarios (optimistic growth, pessimistic, etc) and see if you come out ahead or not. 4) Are there prepayment penalties or costs associated with paying off the car loan early? Most reputable financiers won't include such terms (or they'll only be in effect during the first few months of the loan), but again it depends on who the loan is through. In short: it depends. I know people hate hearing answers like that, but it's true :) Hopefully though, you'll be able to sit down and look at the specifics of your situation and make an informed decision.", "title": "" }, { "docid": "d3e856d7e6912de3291f0bf813915525", "text": "\"You're supposed to be filling form 433-A. Vehicles are on line 18. You will fill there the current fair value of the car and the current balance on the loans. The last column is \"\"equity\"\", which in your case will indeed be a negative number. The \"\"value\"\" is what the car is worth. The \"\"equity\"\" is what the car is worth to you. IRS uses the \"\"equity\"\" value to calculate your solvency. Any time you fill a form to the IRS - read the instructions carefully, for each line and line. If in doubt - talk to a professional licensed in your state. I'm not a professional, and this is not a tax advice.\"", "title": "" }, { "docid": "e49810044068601d5e562c156a09e65c", "text": "\"The best solution is to \"\"buy\"\" the car and get your own loan (like @ChrisInEdmonton answered). That being said, my credit union let me add my spouse to a title while I still had a loan for a title filing fee. You may ask the bank that holds the title if they have a provision for adding someone to the title without changing the loan. Total cost to me was an afternoon at the bank and something like $20 or $40 (it's been a while).\"", "title": "" }, { "docid": "c713427fa07d518950a244e6882d8b57", "text": "What can you do? Pay the loan or face the debt collectors. The finance company don't care who now keeps the car, or who drives it. There's money outstanding on the loan, and your signature on the loan form. That's why co-signing a loan for someone else so often ends in tears.", "title": "" }, { "docid": "78c7b2bf71f314407d951a11d5e096fb", "text": "\"It's possible the $16,000 was for more than the car. Perhaps extras were added on at purchase time; or perhaps they were folded into the retail price of the car. Here's an example. 2014: I'm ready to buy. My 3-year-old trade-in originally cost $15,000, and I financed it for 6 years and still owe $6500. It has lots of miles and excess wear, so fair blue-book is $4500. I'm \"\"upside down\"\" by $2000, meaning I'd have to pay $2000 cash just to walk away from the car. I'll never have that, because I'm not a saver. So how can we get you in a new car today? Dealer says \"\"If you pay the full $15,000 retail price plus $1000 of worthless dealer add-ons like wax undercoat (instead of the common discounted $14,000 price), I'll eat your $2000 loss on the trade.\"\" All gets folded into my new car financing. It's magic! (actually it's called rollover.) 2017: I'm getting itchy to trade up, and doggone it, I'm upside down on this car. Why does this keep happening to me? In this case, it's rollover and other add-ons, combined with too-long car loans (6 year), combined with excessive mileage and wear on the vehicle.\"", "title": "" }, { "docid": "f087a10097e00e20918bd1d8411b4758", "text": "\"I don't know of any way to \"\"transfer\"\" a debt to another person without their consent or the lender's consent. You are responsible for the loan, and you need to either pay it or give up the asset that it's tied to (the car). At least you weren't just a cosigner with no title to the car - then you'd be in worse shape. If you don't want your credit tarnished, I would start (or keep) making the payments, knowing that you are getting the equity that results from the principal you're paying (you're only out the interest portion). If it were me, here are the things I would do:\"", "title": "" }, { "docid": "54df40bf61e056d37576ccc99111fa4c", "text": "So many answers here are missing the mark. I have a $100k mortgage--because that isn't paid off, I can't buy a car? That's really misguided logic. You have a reasonably large amount of college debt and didn't mention any other debt-- It's a really big deal what kind of debt this is. Is it unsecured debt through a private lender? Is it a federal loan from the Department of Education? Let's assume the worst possible (reasonable) situation. You lose your job and spend the next year plus looking for work. This is the boat numerous people out of college are in (far far far FAR more than the unemployment rates indicate). Federal loans have somewhat reasonable (indentured servitude, but I digress) repayment strategies; you can base the payment on your current income through income-based and income-continent repayment plans. If you're through a private lender, they still expect payment. In both cases--because the US hit students with ridiculous lending practices, your interest rates are likely 5-10% or even higher. Given your take-home income is quite large and I don't know exactly the cost of living where you live--you have to make some reasonable decisions. You can afford a car note for basically any car you want. What's the worst that happens if you can't afford the car? They take it back. If you can afford to feed yourself, house yourself, pay your other monthly bills...you make so much more than the median income in the US that I really don't see any issues. What you should do is write out all your monthly costs and figure out how much unallocated money you have, but I'd imagine you have enough money coming in to finance any reasonable new or used car. Keep in mind new will have much higher insurance and costs, but if you pick a good car your headaches besides that will be minimal.", "title": "" }, { "docid": "2bcff75efa64863edad934ea3a368296", "text": "\"You say \"\"it's expensive\"\". I'm going to interpret this as \"\"the monthly payments are too high\"\". Basically, you need to get your old loan paid off, presumably by selling the car you have now. This is the tough part. If you sold the car now, how much would you get for it? You can use Kelley Blue Book to figure out what the car is roughly worth. That's not a guarantee that it will actually sell for that much. Look in your local classifieds to see what similar cars are selling for. (Keep in mind that you will usually get less for your old car if you trade it in versus sell it yourself.) Now, if you owe more than your car is worth, you're in a really tight spot. If you don't get enough money when you sell it, you are still stuck with the remainder of the loan. In that case, it is usually best to just stick with the car you have, and be more cautious about payments and loan length the next time you finance a car. Penalties: Most car loans don't have any kind of early repayment penalty. However, you should check your loan paperwork just to make sure.\"", "title": "" }, { "docid": "132988cfee7571ec7007c1abf1738e69", "text": "\"Without knowing the details of your financial situation, I can only offer general advice. It might be worth having a financial counselor look at your finances and offer some custom advice. You might be able to find someone that will do this for free by asking at your local church. I would advise you not to try to get another loan, and certainly not to start charging things to a credit card. You are correct when you called it a \"\"nightmare.\"\" You are currently struggling with your finances, and getting further into debt will not help. It would only be a very short-term fix and have long-lasting consequences. What you need to do is look at the income that you have and prioritize your spending. For example, your list of basic needs includes: If you have other things that you are spending money on, such as medical debt or other old debt that you are trying to pay off, those are not as important as funding your basic needs above. If there is anything you can do to reduce the cost of the basic needs, do it. For example, finding a cheaper place to live or a place closer to your job might save you money. Perhaps accepting nutrition assistance from a local food bank or the Salvation Army is an option for you. Now, about your car: Your transportation to your job is very much one of your basic needs, as it will enable you to pay for your other needs. If you can use public transportation until you can get a working car again, or you can find someone that will give you a ride, that will solve this problem. If not, you'll need to get a working car. You definitely don't want to take out another loan for a car, as you are already having trouble paying the first loan. I'm guessing that it will be less expensive to get the engine repaired than it will be to buy a new car at this point. But that is just a guess. You'll need to find out how much it will cost to fix the car, and see if you can swing it by perhaps eliminating expenses that aren't necessary, even for a short time. For example, if you are paying installments on medical debt, you might have to skip a payment to fix your car. It's not ideal, but if you are short on cash, it is a better option than losing your job or taking out even more debt for your car. Alternatively, buying another, functional car, if it costs less than fixing your current car, is an option. If you don't have the money to pay your current car loan payments, you'll lose your current car. Just to be clear, many of these options will mess up your credit score. However, borrowing more, in an attempt to save your credit score, will probably only put off the inevitable, as it will make paying everything off that much harder. If you don't have enough income to pay your debts, you might be better off to just take the credit score ding, get back on your feet, and then work to eliminate the debt once you've got your basic needs covered. Sorry to hear about your situation. Again, this advice is just general, and might not all apply to your financial details. I recommend talking to the pastor of a local church and see if they have someone that can sit down with you and discuss your options.\"", "title": "" }, { "docid": "148f0f976110c67e4db7052db46b5637", "text": "\"Without all the details it's hard to tell what options you may have, but none of them are good. When you cosign you are saying that, you believe the primary signer will make good on the loan, but that if he doesn't you will. You are 100% responsible for this debt. As such, there are some actions you can take. First, really try to stress to your friend, that they need to get you outta this loan. Urge them to re-finance with out you if they can. Next look for \"\"better\"\" ways of defaulting on the loan and take them. Depending on what the loan is for you could deed-in-lue or short sale. You may just have to admit default. If you work with the bank, and try not to drag out the process, you will likely end up in a better place down the line. Also of importance is ownership. If you pay the loan, do you get ownership of the thing the loan was secured against? Usually not, but working with an attorney and the bank, maybe. For example, if it's a car, can the \"\"friend\"\" sign over the car to you, then you sell it, and reduce your debt. Basically as a cosigner, you have some rights, but you have all the responsibilities. You need to talk to an attorney and possibly the bank, and see what your options are. At this point, if you think the friend is not that much of a friend anymore, it's time to make sure that any conversation you have with them is recorded in email, or on paper.\"", "title": "" }, { "docid": "76f88f0cd1824938c0967712aa2c1b41", "text": "First, don't owe (much) money on a car that's out of warranty. If you have an engine blow up and repairs will cost the lion's share of the car's bluebook value, the entire car loan immediately comes due because the collateral is now worthless. This puts you in a very miserable situation because you must pay off the car suddenly while also securing other transportation! Second, watch for possible early-payment penalties. They are srill lokely cheaper than paying interest, but run the numbers. Their purpose is to repay the lender the amount of money they already paid out to the dealer in sales commission or kickback for referring the loan. The positive effects you want for your credit report only require an open loan; owing more money doesn't help, it hurts. However, interest is proportional to principal owed, so a $10,000 car loan is 10 times the interest cost of a $1000 car loan. That means paying most of it off early can fulfill your purpose. As the car is nearer payoff, you can reduce costs further (assuming you cna handle the hit) by increasing the deductible on collision and comprehensive (fire and theft) auto insurance. It's not just you paying more co-pay, it also means the insurance company doesn't have to deal with smaller claims at all, e.g. Nodody with a $1000 deductivle files a claim on an $800 repair. If the amount you owe is small compared to its bluebook value, and within $1000-2000 of paid off, the lender may be OK with you dropping collision and comprehensive coverage altogether (assuming you are). All of this adds up to paying most of it off, but not all, may be the way to go. You could also talk to your lender about paying say, 3/4 of it off, and refinancing the rest as a 12-month deal.", "title": "" }, { "docid": "be2775a7348a4342d1577d40a0478832", "text": "Sounds like you need to contact your ex and sort it out. If you have co-signed the loan, changes are you are equally responsible even if on party chooses not to pay, then the bank will come after the other one. If you no longer wish to be part of the arrangement and your ex still wants the car, she will have to buy you out of the car and become fully responsible for the liability.", "title": "" }, { "docid": "d2230d1d67aebbf0cbe938d31de014c5", "text": "\"Imagine that, a car dealership lied to someone trusting. Who would have thought. A big question is how well do you get along with your \"\"ex\"\"? Can you be in the same room without fighting? Can you agree on things that are mutually beneficial? The car will have to be paid off, and taken out of his name. The mechanics on how to do this is a bit tricky and you may want to see a lawyer about it. Having you being the sole owner of the car benefits him because he is no longer a cosigner on a loan. This will help him get additional loans if he chooses, or cosign on his next gf's car. And of course this benefits you as you \"\"own\"\" the car instead of both of you. You will probably have to refinance the car in your name only. Do you have sufficient credit? Once this happens can you pay off the car in like a year or so? If you search this site a similar questions is asked about once per month. Car loans are pretty terrible, in the future you should avoid them. Cosigning is even worse and you should never again participate in such a thing. Another option is to just sell the car and start over with your own car hopefully paid for in cash.\"", "title": "" } ]	fiqa
82ce39799125ae64a0b689bc57bc5ce9	Should I use my non-tax advantaged investment account to pay off debt?	[ { "docid": "7f272dff1e0d553e55b5cbe51aea5d43", "text": "If what you are paying in interest on the debt is a higher percentage than what your investments are returning, the best investment you can make is to pay off the debt. If you're lucky enough to be paying historically low rates (as I am on my mortgage) and getting good returns on the investments so the latter is the higher percentage, the balance goes the other way and you'd want to continue paying off the debt relatively slowly -- essentially treating it as a leveraged investment. If you aren't sure, paying off the debt should probably be the default prefrence.", "title": "" }, { "docid": "6a9de000912cc3f343501d00dbf83a24", "text": "You could pay off a portion of the debt and your minimum payments should also go down proportionately. Your investment managers may be able to continue making returns in the markets in a sideways and a bear market. So you have 24k contributing to your net worth, and ~50k giving you a negative net worth. At best, you can bring this down to a negative 25k net worth, or you can start and keep using some of the gains from your investment account to supplement your credit payments (along with your income). This is based on chance that your investment managers can continue making gains, compared to paying down 24k and having possibly zero liquid savings now, but having more of your salary to start saving and make the lowered minimum payments, assuming you don't borrow more. Those are the options I've thought of, I don't see either option being necessarily quicker than the other.", "title": "" }, { "docid": "7c853961074fd36f608ef0fb10f40b4a", "text": "Paying off debts will reduce your monthly obligation to creditors (less risk) and also remove the possibility of foreclosure / repossession / lawsuit if you ever lost access to income (less risk). Risk is an important part of the equation that can get overlooked. It sounds like pulling that money out of the market will reduce your yearly tax bill as well.", "title": "" } ]	[ { "docid": "406c837abc57f057c08312d335134d64", "text": "Some of the expenses you describe may be eligible to be paid off by a 401(k) without incurring a penalty. As long as you do not mind paying tax on the extra income. If your tax bracket does not go up, then using your IRA may not be a bad idea. You should consult a tax expert and see which expenses can qualify for a withdrawal without penalty. I believe medical bills and medical insurance costs are eligible to be withdrawn without penalty in some instances.", "title": "" }, { "docid": "6e749d75baf01102ec18f7913553b5f3", "text": "My advice is that if you've got the money now to pay off your student loans, do so. You've saved up all of that money in one year's time. If you pay it off now, you'll eliminate all of those monthly payments, you'll be done paying interest, and you should be able to save even more toward your business over the next year. Over the next year, you can get started on your business part time, while still working full time to pile up cash toward your business. Neither you nor your business will be paying interest on anything, and you'll start out in a very strong position. The interest on your student loans might be tax deductible, depending on your situation. However, this doesn't really matter a whole lot, in my opinion. You've got about $22k in debt, and the interest will cost you roughly $1k over the next year. Why pay $1k to the bank to gain maybe $250 in tax savings? Starting a business is stressful. There will be good times and bad. How long will it take you to pay off your debt at $250 a month? 5 or 6 years, probably. By eliminating the debt now, you'll be able to save up capital for your business even faster. And when you experience some slow times in your business, your monthly expenses will be less.", "title": "" }, { "docid": "9604ecfe11c08a8eb7b0a2d8f61001e7", "text": "I would go with your alternative idea: get rid of the debt as fast as possible. You have $32k of debt. It's a lot, but with your new $90k salary, do you think you could get rid of it all in 12 months? See if you can make that happen. Once the debt is gone, you'll be in a position to invest as much as you want and keep all your gains. You are worried about sacrificing future money in your investments, but if you eliminate the debt over the next year, this will be minimized. Just lose the debt.", "title": "" }, { "docid": "3ab452289ddf26191d5f0f7e818ef17d", "text": "I have been in a similar position as you for the past few years. I put a bunch of cash into a tax free savings account (canadian) instead of paying down debt. My rationale was that I wanted the exposure to the market and had to be in it in order to pay attention. I also put money into an rasp, but only because my employer matched it (100% gain, no brainer). Looking back, I think it would have been a better idea to get debt free sooner. Having that debt weighs on you and haunts everything you try to do. You can't afford rent where you want to be, where you should be. There's no keeping up with the Jones' if you're paying off debt. That being said, in Canada your student loans are secured and if you lose your job, the government makes payments for you. If your loans are structured like this, then you are better off hanging onto that money.", "title": "" }, { "docid": "132ecb257ac4664dc0b3037828419962", "text": "You should definitely favor holding bonds in tax-advantaged accounts, because bonds are not tax-efficient. The reason is that more of their value comes in the form of regular, periodic distributions, rather than an increase in value as is the case with stocks or stock funds. With stocks, you can choose to realize all that appreciation when it is most advantageous for you from a tax perspective. Additionally, stock dividends often receive lower tax rates. For much more detail, see Tax-efficient fund placement.", "title": "" }, { "docid": "520b5db44deeea7b530a30fca45f99d6", "text": "\"If you make $10 in salary, $5 in interest on savings, and $10 in dividends, your income is $25, not $10. If you have a billion dollars in well-invested assets, you can take a loan against those assets and the interest payment on the loan will be smaller than the interest you earn on the assets. That means your investment will grow faster than your debt and you have a net positive gain. It makes no sense to do this if the value of your asset is static. In that case, you would be better off just to withdraw from the asset and spend it directly, since a loan against that static asset will result in you spending your asset plus interest charges. If you have a good enough rate of return on your investment, you may actually be able to do this in perpetuity, taking out loan after loan, making the loan payments from the loan proceeds, while the value of your original asset pool continues to grow. At any given time, though, a severe downturn in the market could potentially leave you with large debts and insufficient value in your assets to back the debt. If that happens, you won't be getting another loan and the merry-go-round will stop spinning. It's a bit of a Ponzi scheme, in a way. The U.S. government has done exactly this for a long time and has gotten away with it because the dollar has been the world's reserve currency. You could always get a loan against the value of the U.S. currency in the past. Those days may be dwindling, with more countries choosing alternative currencies to conduct business with and the dollar becoming comparatively weaker into the foreseeable future. If you have savings, you can spend more than you make, which will put you into debt, then you can draw down your savings to pay that debt, and at the end of the month you will be out of debt, but have less in savings. You cannot do this forever. Eventually, you run out of savings. If you have no savings, you immediately go into debt and stay there when you spend more than you make. This is simple arithmetic. If you have no savings, but you own assets (real estate, securities, a collection of never-opened Beatles vinyl records, a bicycle), then you could spend more than you make, and be in debt, but have the potential to liquidate assets to pay off all or part of the debt. This depends on finding a buyer and negotiating a price that helps you enough to make a real difference. If you have a car, and you owe $10 on it, but you can only find a buyer willing to pay $8 for the car, that doesn't help you unless you can refinance the $2 and your new payment amount is lower than the old payment amount. But then you're still $2 in debt on the car even though you no longer possess it, and you've still increased your debt by spending more than you made. If you stay on this path, sooner or later you will not have any assets left and you will be in debt, plain and simple. As a wrinkle in the concrete example, let's say you have stock options with your employer. This is a form of a \"\"call.\"\" You could also purchase a call through a broker in the stock market, or for a commodity in the futures market. That means you pay up front for the right to buy a specific amount of an asset at a fixed price (usually with an expiration date). You don't own the stock, you just have the right to buy it at the call price, regardless of the current market value when you buy it. In the case of employee stock options, your upfront cost is in the form of a vesting schedule. You have to remain employed for a set time before a specific number of stocks become eligible for you to purchase at your option price (the stocks \"\"vest\"\" on a certain date). Remain employed longer, and more stocks may vest, depending on your contract. If you quit or are terminated before that date, you forfeit your options. If you stick around through your vesting schedule, you pay real money to buy the stock at your option price. It only makes sense to do this if the market value of the stock is higher than your option price. If the current market value is lower than your option price, you're better off just buying the asset at the current market value, or waiting and hoping that the value increases before your contract expires. You could drive yourself into debt by spending more than you make, but still have a chance to eliminate your debt by exercising your call/option and then re-selling the asset if it is worth more than what you pay for it. But you may have to wait for a vesting period to elapse before you can exercise your option (depending on the nature of your contract). During this waiting period, you are in debt, and if you can't service your debt (i.e. make payments acceptable to your creditors) your things could get repossessed. Oh, don't forget that you'll also pay a brokerage fee to sell the asset after you exercise your option. Further, if you have exhausted your savings and nobody will give you a loan to exercise your stock (or futures) options, then in the end you would be even further in debt because you already paid for the call, but you are unable to capitalize it and you'll lose what you already paid. If you can get a loan to exercise your option, but you're a bad credit risk, chances are good that the lender will draft a contract requiring you to immediately pay back the loan proceeds plus a fee out of the proceeds of re-selling the stock or other asset. In fact the lender might even draft a contract assigning ownership of your options to them, and stipulating that they'll pay you what's left after they subtract their fee. Even if you can get a traditional loan, you will pay interest over time. The end result is that your debt has still cost you very real money beyond the face value of the debt. Finally, if the asset for which you have a call has decreased in value lower than the current market value, you would be better off buying it directly in the market instead of exercising your option. But you'll pay transaction fees to do that, and the entire action would be pure speculation (or \"\"investment\"\"), but not an immediate means to pay off your debt. Unless you have reliable insider trading information. But then you risk running afoul of the law. Frankly it might be better to get a loan to pay off your debt than to buy an \"\"investment\"\" hoping the value will increase, unless you could guarantee that the return on your investment would be bigger than the cumulative interest and late fees on your debt (or the risk of repossession of your belongings). Remember that nothing you owe a debt on is actually yours, not your house, not your car, not your bicycle, not your smartphone. Most of the time, your best course of action is to make minimum payments on your lowest-interest debts and make extra payments on your highest interest debt, up to the highest total payment you can tolerate (set something aside in a rainy day fund just in case). As you pay off the highest-interest debt, shift the amount you were paying on that debt to make extra payments on your next highest-interest debt until that one is paid off, and repeat on down the line until you're out of debt, then live within your means so that you don't find yourself working at McDonald's because you don't have a choice when you're in your 80's.\"", "title": "" }, { "docid": "aec4619a8919b0720ce257baae6dfe10", "text": "You are on the right track with your math, but be wary of your assumptions. If you can borrow money at x% (and can afford to make payments on the debt), and you can get a return of > x% from investing, then you would make more money by keeping the debt and investing your savings. Another way to think of it: by paying off the debt you are getting a guaranteed 5% return because that's the rate you'd have paid if you kept the debt. Be wary of your assumption of getting a 10% return in the S&P 500. Nothing is guaranteed, even over the long term. Actual results may well be less, and you could lose money. It doesn't have to be all-or-nothing: why not pay off the higher rate debt at 5% and keep the 3% debt? That's a guaranteed 5% return by paying off the NSLSC loan. And 3% is a pretty low interest rate. If you can afford to make the payments, I see nothing wrong with investing your savings instead of paying off the loan. Make sure you have an emergency fund, too.", "title": "" }, { "docid": "6b528fea265a5b31eca0cccf6ff091b8", "text": "Advantages of paying off debt: Potential advantage of remaining in debt:", "title": "" }, { "docid": "704eec7c676961ec1790bd188c8b0292", "text": "Depends upon the debt cost. Assuming it is consumer debt or credit card debt, it is better to pay that off first, it is the best investment you can make. Let's say it is credit card debt. If you pay 18% interst and have for example a $1,000 amount. If you pay it off you save $180 in interest ($1,000 times 18%). You would have to earn 18% on 1,000 to generate $180 if it was in aninvestment. Here is a link discussing ways of reducing debt Once you have debt paid off you have the cashflow to begin building wealth. The key is in the cashflow.", "title": "" }, { "docid": "4e12ed80eefb5bca7e5891e488a49432", "text": "This is a very interesting question. I'm going to attempt to answer it. Use debt to leverage investment. Historically, stock markets have returned 10% p.a., so today when interest rates are very low, and depending on which country you live in, you could theoretically borrow money at a very low interest rate and earn 10% p.a., pocketing the difference. This can be done through an ETF, mutual funds and other investment instruments. Make sure you have enough cash flow to cover the interest payments! Similar to the concept of acid ratio for companies, you should have slightly more than enough liquid funds to meet the monthly payments. Naturally, this strategy only works when interest rates are low. After that, you'll have to think of other ideas. However, IMO the Fed seems to be heading towards QE3 so we might be seeing a prolonged period of low interest rates, so borrowing seems like a sensible option now. Since the movements of interest rates are political in nature, monitoring this should be quite simple. It depends on you. Since interest rates are the opportunity cost of spending money, the lower the interest rates, the lower the opportunity costs of using money now and repaying it later. Interest rates are a market mechanism so that people who prefer to spend later can lend to people who prefer to spend now for the price of interest. Disclaimer: Historically stocks have returned 10% p.a., but that doesn't mean this trend will continue indefinitely as we have seen fixed income outperform stocks in the recent past.", "title": "" }, { "docid": "3ad260835a0873e58ea782221470c88e", "text": "\"Assuming the numbers in your comments are accurate, you have $2400/month \"\"extra\"\" after paying your expenses. I assume this includes loan payments. You said you have $3k in savings and a $2900 \"\"monthly nut\"\", so only one month of living expenses in savings. In my opinion, your first goal should be to put 100% of your extra money towards savings each month, until you have six months of living expenses saved. That's $2,900 6 or $17,400. Since you have $3K already that means you need $14,400 more, which is exactly six months @ $2,400/month. Next I would pay off your $4K for the bedroom furniture. I don't know the terms you got, but usually if you are not completely paid off when it comes time to pay interest, the rate is very high and you have to pay interest not just going forward, but from the inception of the loan (YMMV--check your loan terms). You may want to look into consolidating your high interest loans into a single loan at a lower rate. Barring that, I would put 100% of my extra monthly income toward your 10% loan until its paid off, and then your 9.25% loan until that's paid off. I would not consider investing in any non-tax-advantaged vehicle until those two loans (at minimum) were paid off. 9.25% is a very good guaranteed return on your money. After that I would continue the strategy of aggressively paying the maximum per month toward your highest interest loans until they are all paid off (with the possible exception of the very low rate Sallie Mae loans). However, I'm probably more conservative than your average investor, and I have a major aversion to paying interest. :)\"", "title": "" }, { "docid": "d928ef4d9e926330853c2e5a63a88b80", "text": "\"Debt increases your exposure to risk. What happens if you lose your job, or a major expense comes up and you have to make a hard decision about skipping a loan payment? Being debt free means you aren't paying money to the bank in interest, and that's money that can go into your pocket. Debt can be a useful tool, however. It's all about what you do with the money you borrow. Will you be able to get something back that is worth more than the interest of the loan? A good example is your education. How much more money will you make with a college degree? Is it more than you will be paying in interest over the life of the loan? Then it was probably worth it. Instead of paying down your loans, can you invest that money into something with a better rate of rate of return than the interest rate of the loan? For example, why pay off your 3% student loan if you can invest in a stock with a 6% return? The money goes to better use if it is invested. (Note that most investments count as taxable income, so you have to factor taxes into your effective rate of return.) The caveat to this is that most investments have at least some risk associated with them. (Stocks don't always go up.) You have to weigh this when deciding to invest vs pay down debts. Paying down the debt is more of a \"\"sure thing\"\". Another thing to consider: If you have a long-term loan (several years), paying extra principal on a loan early on can turn into a huge savings over the life of the loan, due to power of compound interest. Extra payments on a mortgage or student loan can be a wise move. Just make sure you are paying down the principal, not the interest! (And check for early repayment penalties.)\"", "title": "" }, { "docid": "99ecd39bb7ca97518930ca8731a962c3", "text": "Same argument and answer for investing instead of paying off debt, or borrowing to invest. Risk. What happens if the stocks drop by 10%? Sure, you might come out ahead on average, but a drop in the market could be catastrophic from a cash flow point of view. In addition, federal tax debt is arguably the worst kind. The IRS has the authority to garnish wages and has virtually unlimited resources they can use to collect.", "title": "" }, { "docid": "7c5cf4b1b6b9177ec68035790d397fee", "text": "I would recommend not paying it off early for 2 key reasons: If you are a resident of the U.S. you get tax deductibility of mortgage interest, which as pointed out in previous posts, reduces the effective interest rate on your mortgage, never in your life will you ever be allowed to obtain such high leverage at such a low rates. You can probably get higher returns with not much risk. @JoeTaxpayer mentioned various statistics regarding returns when investing in equities. Even though they are a decent bet over the long term, you can get an even better risk reward tradeoff by considering municipal bonds. If you are in the U.S. and invest in the municipal bonds of your state, the interest income will be both federal and state tax-free. In other words, if you were making 3.5% investing in equities, your after tax returns would be significantly less depending on your tax bracket whereas investment-grade municipal bond ETFs will yield probably the same or higher and have no tax. They are also significantly less volatile. Even though they have default risk, the risk is small since most of these bonds are backed by future tax obligations, or other income streams derived from hard assets such as tolls or property. Furthermore, an ETF will have a portfolio of these bonds which will also dampen the impact of any individual defaults. In essence, you are getting paid this spread for simply having access to credit, take advantage of it while you can.", "title": "" }, { "docid": "6856197742bcbab76c7f3726f14eda60", "text": "\"Old question I know, but I have some thoughts to share. Your title and question say two different things. \"\"Better off\"\" should mean maximizing your ex-ante utility. Most of your question seems to describe maximizing your expected return, as do the simulation exercises here. Those are two different things because risk is implicitly ignored by what you call \"\"the pure mathematical answer.\"\" The expected return on your investments needs to exceed the cost of your debt because interest you pay is risk-free while your investments are risky. To solve this problem, consider the portfolio problem where paying down debt is the risk-free asset and consider the set of optimal solutions. You will get a capital allocation line between the solution where you put everything into paying down debt and the optimal/tangent portfolio from the set of risky assets. In order to determine where on that line someone is, you must know their utility function and risk parameters. You also must know the parameters of the investable universe, which we don't.\"", "title": "" } ]	fiqa
7960c459abe19c1aedb20406d88afca7	Using multiple bank accounts	[ { "docid": "b2bfe73bca613298ce22c988da3d6a9f", "text": "There is nothing conceptually wrong with it. If you like it that way, go ahead. The only thing to watch out for is bank policies that effectively penalize having many small accounts. For instance, some banks charge you a fee for checking accounts with a balance below a certain minimum, but will waive the fees for accounts with a higher balance. You may be able to avoid such fees by judicious management of your funds (or by switching to a different bank), but it's something to be aware of. (The interest rates on savings accounts also often vary with the balance, making many small balances less efficient than one big balance. However, right now, at least in the US, interest rates on savings accounts are so low that the difference here is likely to be minimal.)", "title": "" }, { "docid": "0c4ff7b7c5d61828a76f1e9edafbbe34", "text": "\"I live near historic Concord, Massachusetts, and frequently drive past Walden Pond. I'm reminded of Henry David Thoreau's words, \"\"Simplify, simplify, simplify.\"\" In my opinion, fewer is better. 2 checkbooks? I don't see how that makes budgeting any easier. The normal set of expenses are easily kept as one bucket, one account. The savings 2&3 accounts can also be combined and tracked if you really want to think of them as separate accounts. Now, when you talk about 'Retirement' that can be in tax-wise retirement accounts, e.g. 401(k), IRA, etc. or post tax regular brokerage accounts. In our situation, the Schwab non-retirement account was able to handle emergency (as money market funds) along with vacation/rainy day, etc, in CDs of different maturities. As an old person, I remember CDs at 10% or higher, so leaving money in lower interest accounts wasn't good. Cash would go to CDs at 1-5 year maturities to maximize interest, but keep money maturing every 6-9 months. Even with the goal of simplifying, my wife and I each have a 401(k), an IRA, and a Roth IRA, I also have an inherited Roth, and I manage my teen's Roth and brokerage accounts. That's 9 accounts right there. No way to reduce it. To wrap it up, I'd go back to the first 4 you listed, and use the #4 checking attached to the broker account to be the emergency fund. Now you're at 3. Any higher granularity can be done with a spreadsheet. Think of it this way - the day you see the house you love, will you not be so willing to give up that year's vacation?\"", "title": "" } ]	[ { "docid": "5f63fe075eedd9c54fad6c6362c1bb86", "text": "Usually problems like what you're running into mean that the megabank hasn't finished digesting acquisitions, or they cannot meet some state regulatory issue with the main system. Bank of America is/was like this for a few years -- tellers had access to separate Fleet Bank, BankSouth and BoA systems, but you as customer got stuck when doing seemingly routine transactions. You're probably in a situation where your older accounts are in System A, and the newer ones are in recently acquired System B. You should be able to avoid this problem by opening new accounts at Citibank, or just getting another bank. If you have a good rapport with a branch manager, explain the situation and see if they can do anything. FWIW, Unless you're spending alot of time in Manhattan or travel overseas often, there aren't many advantages to having a Citibank account these days.", "title": "" }, { "docid": "7c28f5c19dd0acae5429e650ad60cfcb", "text": "\"There are some banks that offer \"\"pot\"\" accounts like this (off the top of my head I think Intelligent Finance does, although they call them \"\"jars\"\"). The other option for charity specifically would be a CAF account: https://www.cafonline.org/my-personal-giving/plan-your-giving/individual-charity-account.aspx\"", "title": "" }, { "docid": "da0a33e57f0f0404070c71c19c000933", "text": "\"First, there are not necessarily two accounts involved. Usually the receiving party can take the check to the bank on which it is drawn and receive cash. In this case, there is only one bank, it can look to see that the account on which the check is drawn has sufficient funds, and make an (essentially irrevocable) decision to pay the bearer. (Essentially irrevocable precisely because the bearer did not necessarily have to present account information.) The more usual case is that the receiving party deposits the check into an account at their own bank. The receiving party's bank then (directly or indirectly - in the US via the Federal Reserve) presents the check to the paying party's bank. At that point if the there are insufficient funds, the check \"\"bounces\"\" and the receiving party's account will be debited. The receiving party's bank knows that account number because, in this case, the receiving party is a customer of the bank. This is why funds from check deposits are typically not available for immediate withdrawal.\"", "title": "" }, { "docid": "67a4a8453d48b174f08d7b9138ed40e9", "text": "\"When I was younger I had a problem with Washington Mutual. Someone had deposited a check in to my account then ran my account negative with a \"\"dupe\"\" of my debit card. WaMu tied up my account for three months while they investigated because it wasn't simply a debit card fraud issue, this was check fraud (so they claimed). At the time all the money I had in the world was in that account and the ordeal was extremely disruptive to my life. Since the, I never spend on my debit card(s) and I keep more than one checking account to disperse the risk and avoid disruption in the event anything ever happens again. Now one of the accounts contains just enough money (plus a small buffer) to pay my general monthly expenses and the other is my actual checking account. There's no harm in having more than one checking account and if you think it will enhance your finances, do it. Though, there's no reason to get a business account unless you've actually formed a business.\"", "title": "" }, { "docid": "ecb895c7bb53ff9d68dcb55d71197e94", "text": "\"All of these answers are great but I wanted to add one piece of advice from someone who has been married 8 years and been in various financial \"\"situations.\"\" Have one of you (whoever the two of you feel is more organized and more financially responsible) be solely in charge of paying the monthly bills, but keep a spreadsheet or some other tracking mechanism so that the other can monitor this as well. That way if you guys ever decide to switch roles there won't be much of a learning curve. Also, don't do three bank accounts. One or two is enough, more than that starts becoming more difficult to keep track of and if you have any sort of monthly fees on the accounts it also wastes money. My wife and I each have our own account and we get money for each other if necessary. She handles paying the bills but keeps a monthly spreadsheet that has all pertinent info. We have a number and color coding system to determine which paycheck (1st or 2nd of the month) the bill is paid in and whether it has been paid, not paid, or past due (green, yellow, red). Hopefully you don't ever have to see the red color :P\"", "title": "" }, { "docid": "35ee4b7c4719cf7e46e5e2aee3ce8112", "text": "The thing is that you only need one entry, not two. That's the beauty of double entry - since you have double entry system, every transaction will create two entries. So you don't need to create two transactions, you only need one. So you got a $30 gift. You credit Income:Gifts and on the other side Assets:Checking. Your general ledger entry (Menu->Tools->General Ledger) will look like this: You end up with balances: Which represent your total income and your current balance. Similarly with expense for food: GL will look like this: Balances: And you keep track of totals properly.", "title": "" }, { "docid": "0c48f8aa85131df31be74b8f18f3c5fd", "text": "The SWIFT format has multiple place holders. The Beneficiary Bank and Account can be specified using Local Sort Codes [ABA number in this example]. However you would still need to specify the Correspondent Bank and its BIC.", "title": "" }, { "docid": "8018eefd837fd80fcc3c6bd9a4cb2eb5", "text": "\"JoeTaxpayer's answer mentions using a third \"\"house\"\" account. In my comment on his answer, I mentioned that you could simply use a bookkeeping account to track this instead of the overhead of an extra real bank account. Here's the detail of what I think will work for you. If you use a tool like gnucash (probably also possible in quicken, or if you use paper tracking, etc), create an account called \"\"Shared Expenses\"\". Create two sub accounts under that called \"\"his\"\" and \"\"hers\"\". (I'm assuming you'll have your other accounts tracked in the software as well.) I haven't fully tested this approach, so you may have to tweak it a little bit to get exactly what you want. When she pays the rent, record two transactions: When you pay the electric bill, record two transactions: Then you can see at a glance whether the balances on \"\"his\"\" and \"\"hers\"\" match.\"", "title": "" }, { "docid": "c339c34a9bac65524b033ec28d1827c2", "text": "It should be in the name(s) of whomever puts money in the account. When filing your taxes there will be a question or space to mark the percentage of income in each others name. If you're just looking for small amounts of income splitting, then it's legal for the higher earning spouse to pay household expenses and then the lower earning spouse can save all or some of his/her income. Whether or not to have 2 accounts or not has more to do with estate planning and minimizing account fees if applicable. It can also help in a small way for asset allocation if that's based on family assets and also, minimizing commissions.", "title": "" }, { "docid": "7e6ce529c96e20905f0789621c8fcfea", "text": "The easiest options appear to be to open an account with one of the large multinational banks like Citi. They have options such as opening two separate checking accounts, one in each currency, and Citi in particular has an international account that appears to make mutli-currency personal banking easier. All of the options have minimum balance requirements or fees for conversion, but if you need quick access this seems to be the best bet. Even if this is a one-time event and you don't need the account, a bank like Citi may be able to help you cash the check and get access to the funds quicker than a national or local bank. http://www.citibank.com/ipb-global/homepage/newsite/content/english/multi_cap_bank_depo.htm Alternatively if you know anyone with a US bank account you can deposit it with them and take the cash withdrawal from their account, assuming they agree, the check isn't too large, etc.", "title": "" }, { "docid": "0ad76bb6af7557b982b08bf7afcc9498", "text": "\"I'm not aware of banks offering savings account for specific reasons, other than certain accounts for college funds, as the number of reasons someone might want to open a savings account is almost infinite. What I did was open 3 savings accounts with the same bank (I could have opened more, but I didn't need more). Each account is labeled with a nickname for it's specific purpose: Vacation, Emergencies, and Annual fees. This way, I can make automated deposits to each one based on my monthly budgets and track them independently. Most E-Banks offer this type of setup (CapitalOne even advertises it as a \"\"feature\"\") and the interest rate will likely be better than a standard brick-and-mortar bank.\"", "title": "" }, { "docid": "8c9f527a4656e983d5cff2f0a7cea0c2", "text": "A technique that is working pretty well for me: Hide the money from myself: I have two bank accounts at different banks. Let's call them A and B. I asked my employer to send my salary into account A. Furthermore I have configured an automatic transfer of money from account A to account B on the first of each month. I only use account B for all my expenses (rent, credit card, food, etc) and I check its statement quite often. Since the monthly transfer is only 80% of my salary I save money each month in account A. I don't have a credit card attached to the savings account and I almost never look at its statement. Since that money is out of sight, I do not think much about it and I do not think that I could spend it. I know it is a cheap trick, but it works pretty well for me.", "title": "" }, { "docid": "aaa8aad4c12291860d68cfacd8f7b6ed", "text": "I found out there is something called CDARS that allows a person to open a multi-million dollar certificate of deposit account with a single financial institution, who provides FDIC coverage for the entire account. This financial institution spreads the person's money across multiple banks, so that each bank holds less than $250K and can provide the standard FDIC coverage. The account holder doesn't have to worry about any of those details as the main financial institution handles everything. From the account holder's perspective, he/she just has a single account with the main financial institution.", "title": "" }, { "docid": "a5a8f00d13d6121c63e2703247e507dc", "text": "\"Bookkeeping and double-entry accounting is really designed for tracking the finances of a single entity. It sounds like you're trying to use it to keep multiple entities' information, which may somewhat work but isn't really going to be the easiest to understand. Here's a few approaches: In this approach, the books are entirely from your perspective. So, if you're holding onto money that \"\"really\"\" belongs to your kids, then what you've done is you're taking a loan from them. This means that you should record it as a liability on your books. If you received $300, of which $100 was actually yours, $100 belongs to Kid #1 (and thus is a loan from him), and $100 belongs to Kid #2 (and thus is a loan from her), you'd record it just that way. Note that you only received $100 of income, since that's the only money that's \"\"yours\"\", and the other $200 you're only holding on behalf of your kids. When you give the money to your kids or spend it on their behalf, then you debit the liability accordingly and credit the Petty Cash or other account you spent it from. If you wanted to do this in excruciating detail, then your kids could each have their own set of books, in which they would see a transfer from their own Income:Garage Sale account into their Assets:Held by Parents account. For this, you just apportion each of your asset accounts into subaccounts tracking how much money each of you has in it. This lets you treat the whole family as one single entity, sharing in the income, expenses, etc. It lets you see the whole pool of money as being the family's, but also lets you track internally some value of assets for each person. Whenever you spend money you need to record which subaccount it came from, and it could be more challenging if you actually need to record income or expenses separately per person (for some sort of tax reasons, say) unless you also break up each Income and Expense account per person as well. (In which case, it may be easier just to have each person keep their entirely separate set of books.) I don't see a whole lot of advantages, but I'll mention it because you suggested using equity accounts. Equity is designed for tracking how much \"\"capital\"\" each \"\"investor\"\" contributes to the entity, and for tracking a household it can be hard for that to make a lot of sense, though I suppose it can be done. From a math perspective, Equity is treated exactly like Liabilities in the accounting equation, so you could end up using it a lot like in my Approach #1, where Equity represents how much you owe each of the kids. But in that case, I'd find it simpler to just go ahead and treat them as Liabilities. But if it makes you feel better to just use the word Equity rather than Liability, to represent that the kids are \"\"investing\"\" in the household or the like, go right ahead. If you're going to look at the books from your perspective and the kids as investing in it, the transaction would look like this: And it's really all handled in the same way an Approach #1. If on the other hand, you really want the books to represent \"\"the family\"\", then you'd need to have the family's books really look more like a partnership. This is getting a bit out of my league, but I'd imagine it'd be something like this: That is to say, the family make the sale, and has the money, and the \"\"shareholders\"\" could see it as such, but don't have any obvious direct claim to the money since there hasn't been a distribution to them yet. Any assets would just be assumed to be split three ways, if it's an equal partnership. Then, when being spent, the entity would have an Expense transaction of \"\"Dividend\"\" or the like, where it distributes the money to the shareholders so that they could do something with it. Alternatively, you'd just have the capital be contributed, And then any \"\"income\"\" would have to be handled on the individual books of the \"\"investors\"\" involved, as it would represent that they make the money, and then contributed it to the \"\"family books\"\". This approach seems much more complicated than I'd want to do myself, though.\"", "title": "" }, { "docid": "8151494626fa89a0c52f6bc89f2d4c98", "text": "Yes. Although I imagine the risk is small, you can remove the risk by splitting your money amongst multiple accounts at different banks so that none of the account totals exceed the FDIC Insurance limit. There are several banks or financial institutions that deposit money in multiple banks to double or triple the effective insurance limit (Fidelity has an account like this, for example)", "title": "" } ]	fiqa
443133cc1b4000cc92961b33bd921f6a	What is this fund?	[ { "docid": "29b2b167a755e40ce7a9c0ad501f6b0d", "text": "SMID CAP FUND is Fidelity's way of saying SMALL to MID CAP FUND. Small to Medium is self explanatory. Cap is capitalization, and it basically means how much the sum of all the existing shares of the company are worth. Fidelity names the funds inside their 401k plans according to who provides the fund. They also provide management resources for funds chosen by your employer. There should be more available about the fund you're interested in on your Fidelity 401(k) site.", "title": "" } ]	[ { "docid": "d2ee45566bdfe71aa642ed965b2bc49e", "text": "\"There are some index funds out there like this - generally they are called \"\"equal weight\"\" funds. For example, the Rydex S&P Equal-Weight ETF. Rydex also has several other equal weight sector funds\"", "title": "" }, { "docid": "8abab3a7c58f602a64ee42553c53c2d9", "text": "\"I don't think you have your head in the right space - you seem to be thinking of these lifecycle funds like they're an annuity or a pension, but they're not. They're an investment. Specifically, they're a mutual fund that will invest in a collection of other mutual funds, which in turn invest in stock and bonds. Stocks go up, and stocks go down. Bonds go up, and bonds go down. How much you'll have in this fund next year is unknowable, much less 32 years from now. What you can know, is that saving regularly over the next 32 years and investing it in a reasonable, and diversified way in a tax sheltered account like that Roth will mean you have a nice chunk of change sitting there when you retire. The lifecycle funds exist to help you with that \"\"reasonable\"\" and \"\"diversified\"\" bit.They're meant to be one stop shopping for a retirement portfolio. They put your money into a diversified portfolio, then \"\"age\"\" the portfolio allocations over time to make it go from a high risk, (potentially) high reward allocation now to a lower risk, lower reward portfolio as you approach retirement. The idea is is that you want to shoot for making lots of money now, but when you're older, you want to focus more on keeping the money you have. Incidentally, kudos for getting into seriously saving for retirement when you're young. One of the biggest positive effects you can have on how much you retire with is simply time. The more time your money can sit there, the better. At 26, if you're putting away 10 percent into a Roth, you're doing just fine. If that 5k is more than 10 percent, you'll do better than fine. (That's a rule of thumb, but it's based on a lot of things I've read where people have gamed out various scenarios, as well as my own, cruder calculations I've done in the past)\"", "title": "" }, { "docid": "f824112e5846e465882fb442b9ec6dd2", "text": "\"As an exercise, I want to give this a shot. I'm not involved in a firm that cares about liquidity so all this stuff is outside my purview. As I understand it, it goes something like this: buy side fund puts an order to the market as a whole (all or most possibly exchanges). HFTs see that order hit the first exchange but have connectivity to exchanges further down the pipe that is faster than the buy side fund. They immediately send their own order in, which reaches exchanges and executes before the buy side fund's order can. They immediately put up an ask, and buy side fund's order hits that ask and is filled (I guess I'm assuming the order was a market order from the beginning). This is in effect the HFT front running the buy side fund. Is this accurate? Even if true, whether I have a genuine issue with this... I'm not sure. Has anyone on the \"\"pro-HFT\"\" side written a solid rebuttal to Lewis and Katsuyama that has solid research behind it?\"", "title": "" }, { "docid": "bdc088e3c947f07ccdf31e5b845889e8", "text": "\"I just looked at a fund for my client, the fund is T Rowe Price Retirement 2015 (TRRGX). As stated in the prospectus, it has an annual expense ratio of 0.63%. In the fine print below the funds expenses, it says \"\"While the fund itself charges no management fee, it will indirectly bear its pro-rata share of the expenses of the underlying T. Rowe Price funds in which it invests (acquired funds). The acquired funds are expected to bear the operating expenses of the fund.\"\" One of it's acquired funds is TROSX which has an expense ratio of 0.86%. So the total cost of the fund is the weighted average of the \"\"acquired funds\"\" expense ratio's plus the listed expense ratio of the fund. You can see this at http://doc.morningstar.com/docdetail.aspx?clientid=schwab&key=84b36f1bf3830e07&cusip=74149P796 and its all listed in \"\"Fees and Expenses of the Fund\"\"\"", "title": "" }, { "docid": "4e35c62837d601cc2ddb9af278e6287e", "text": "Cornerstone Strategic Value Fund, Inc. is a diversified, closed-end management investment company. It was incorporated in Maryland on May 1, 1987 and commenced investment operations on June 30, 1987. The Fund’s shares of Common Stock are traded on the NYSE MKT under the ticker symbol “CLM.”[1] That essentially means that CLM is a company all of whose assets are held as tradable financial instruments OR EQUIVALENTLY CLM is an ETF that was created as a company in its own right. That it was founded in the 80s, before the modern definition of ETFs really existed, it is probably more helpful to think of it by the first definition as the website mentions that it is traded as common stock so its stock holds more in common with stock than ETFs. [1] http://www.cornerstonestrategicvaluefund.com/", "title": "" }, { "docid": "2e5bb05701d5b40caffbc5d98be9d723", "text": "Domini offers such a fund. It might suit you, or it might include things you wish to avoid. I'm not judging your goals, but would suggest that it might be tough to find a fund that has the same values as you. If you choose individual stocks, you might have to do a lot of reading, and decide if it's all or none, i.e. if a company seems to do well, but somehow has an tiny portion in a sector you don't like, do you dismiss them? In the US, Costco, for example, is a warehouse club, and treats employees well. A fair wage, benefits, etc. But they have a liquor store at many locations. Absent the alcohol, would you research every one of their suppliers?", "title": "" }, { "docid": "4b163e05a8bc82fc2d2c28d0c5c8e1f6", "text": "\"You need to hope that a fund exists targeting the particular market segment you are interested in. For example, searching for \"\"cloud computing ETF\"\" throws up one result. You'd then need to read all the details of how it invests to figure out if that really matches up with what you want - there'll always be various trade-offs the fund manager has to make. For example, with this fund, one warning is that this ETF makes allocations to larger firms that are involved in the cloud computing space but derive the majority of their revenues from other operations Bear in mind that today's stock prices might have already priced in a lot of future growth in the sector. So you might only make money if the sector exceeds that predicted growth level (and vice versa, if it grows, but not that fast, you could lose money). If the sector grows exactly as predicted, stock prices might stay flat, though you'd still make a bit of money if they pay dividends. Also, note that the expense ratios for specialist funds like this are often quite a bit higher than for \"\"general market\"\" funds. They are also likely to be traded less frequently, which will increase the \"\"bid-ask\"\" spread - i.e. the cost of buying into and getting out of these funds will be higher.\"", "title": "" }, { "docid": "4aa7f04b3f72b185e998403e1c10bcfc", "text": "\"I think you're on the right track with that strategy. If you want to learn more about this strategy, I'd recommend \"\"The Intelligent Asset Allocator\"\" by William Bernstein. As for the Über–Tuber portfolio you linked to, my only concern would be that it is diversified in everything except for the short-term bond component, which is 40%. It might be worth looking at some portfolios that have more than one bond allocation -- possibly diversifying more across corporate vs government, and intermediate vs short term. Even the Cheapskate's portfolio located immediately above the Über–Tuber has 20% Corporate and 20% Government. Also note that they mention: Because it includes so many funds, it would be expensive and unwieldy for an account less than $100,000. Regarding your question about the disadvantages of an index-fund-based asset allocation strategy:\"", "title": "" }, { "docid": "94fd0ac68a72a65937095c6edeaedb74", "text": "Thanks very much. 12b1 is a form that explains how a fund uses that .25-1% fee, right? So that's part of the puzzle im getting at. I'm not necessarily trying to understand my net fees, but more who pays who and based off of what. For a quick example, betterment bought me a bunch of vanguard ETFs. That's cool. But vanguard underperformed vs their blackrock and ssga etfs. I get that vanguard has lower fees, but the return was less even taking those into account. I'm wondering, first what sort of kickback betterment got for buying those funds, inclusive of wholesale deals, education fees etc. I'm also wondering how this food chain goes up and down the sponsor, manager tree. I'm sure it's more than just splitting up that 1%", "title": "" }, { "docid": "a0562393c7da826282faa99246a978d7", "text": "You didn't identify the fund but here is the most obvious way: Some of the stocks they owned could had dividends. Therefore they would have had to pass them on to the investors. If the fund sold shares of stocks, they could have capital gains. They would have sold stocks to pay investors who sold shares. They also could have sold shares of stock to lock in gains, or to get out of positions they no longer wanted. Therefore a fund could have dividends, and capital gains, but not have an increase in value for the year. Some investors look at how tax efficient a fund is, before investing.", "title": "" }, { "docid": "63c887e3ce5fcbdc3b4a2d62eecfd837", "text": "Let's say that you want to invest in the stock market. Choosing and investing in only one stock is risky. You can lower your risk by diversifying, or investing in lots of different stocks. However, you have some problems with this: When you buy stocks directly, you have to buy whole shares, and you don't have enough money to buy even one whole share of all the stocks you want to invest in. You aren't even sure which stocks you should buy. A mutual fund solves both of these problems. You get together with other investors and pool your money together to buy a group of stocks. That way, your investment is diversified in lots of different stocks without having to have enough money to buy whole shares of each one. And the mutual fund has a manager that chooses which stocks the fund will invest in, so you don't have to pick. There are lots of mutual funds to choose from, with as many different objectives as you can imagine. Some invest in large companies, others small; some invest in a certain sector of companies (utilities or health care, for example), some invest in stocks that pay a dividend, others are focused on growth. Some funds don't invest in stocks at all; they might invest in bonds, real estate, or precious metals. Some funds are actively managed, where the manager actively buys and sells different stocks in the fund continuously (and takes a fee for his services), and others simply invest in a list of stocks and rarely buy or sell (these are called index funds). To answer your question, yes, the JPMorgan Emerging Markets Equity Fund is a mutual fund. It is an actively-managed stock mutual fund that attempts to invest in growing companies that do business in countries with rapidly developing economies.", "title": "" }, { "docid": "3b0513ea719821872a14f80eda6c8c71", "text": "ACWI refers to a fund that tracks the MSCI All Country World Index, which is A market capitalization weighted index designed to provide a broad measure of equity-market performance throughout the world. The MSCI ACWI is maintained by Morgan Stanley Capital International, and is comprised of stocks from both developed and emerging markets. The ex-US in the name implies exactly what it sounds; this fund probably invests in stock markets (or stock market indexes) of the countries in the index, except the US. Brd Mkt refers to a Broad Market index, which, in the US, means that the fund attempts to track the performance of a wide swath of the US stock market (wider than just the S&P 500, for example). The Dow Jones U.S. Total Stock Market Index, the Wilshire 5000 index, the Russell 2000 index, the MSCI US Broad Market Index, and the CRSP US Total Market Index are all examples of such an index. This could also refer to a fund similar to the one above in that it tracks a broad swath of the several stock markets across the world. I spoke with BNY Mellon about the rest, and they told me this: EB - Employee Benefit (a bank collective fund for ERISA qualified assets) DL - Daily Liquid (provides for daily trading of fund shares) SL - Securities Lending (fund engages in the BNY Mellon securities lending program) Non-SL - Non-Securities Lending (fund does not engage in the BNY Mellon securities lending program) I'll add more detail. EB (Employee Benefit) refers to plans that fall under the Employee Retirement Income Security Act, which are a set a laws that govern employee pensions and retirement plans. This is simply BNY Mellon's designation for funds that are offered through 401(k)'s and other retirement vehicles. As I said before, DL refers to Daily Liquidity, which means that you can buy into and sell out of the fund on a daily basis. There may be fees for this in your plan, however. SL (Securities Lending) often refers to institutional funds that loan out their long positions to investment banks or brokers so that the clients of those banks/brokerages can sell the shares short. This SeekingAlpha article has a good explanation of how this procedure works in practice for ETF's, and the procedure is identical for mutual funds: An exchange-traded fund lends out shares of its holdings to another party and charges a rental fee. Running a securities-lending program is another way for an ETF provider to wring more return out of a fund's holdings. Revenue from these programs is used to offset a fund's expenses, which allows the provider to charge a lower expense ratio and/or tighten the performance gap between an ETF and its benchmark.", "title": "" }, { "docid": "cefc4f123d70fef73e55be2b5f0bfd01", "text": "One way I heard of, from a friend who ran a similar fund as yours, is to calculate $days of investment and divide the investment as accordingly. For example, If I invested 10$ for 10 days and you have invested 20$ for 5 days. At the end of the 10th day my $day = 1010=100, while your $day=205=100. If the investement has grown to 100$, the I should get $100/(100+100)100=$50, you also should get the same. This I guess is equitable, you could try dividing the corpus with above method. It consideres the amount invested as well as the time invested for. I think by the above method, you could also handle the inbetween withdrawals.", "title": "" }, { "docid": "862701abf9ce54de7a4210aa28b673a8", "text": "I will be messaging you on [2021-06-15 14:54:56 UTC](http://www.wolframalpha.com/input/?i=2021-06-15 14:54:56 UTC To Local Time) to remind you of [this link.](https://www.reddit.com/r/finance/comments/6cvvei/a_hedge_fund_manager_is_supporting_a_free_masters/dixuco3) [CLICK THIS LINK*](http://np.reddit.com/message/compose/?to=RemindMeBot&subject=Reminder&message=[https://www.reddit.com/r/finance/comments/6cvvei/a_hedge_fund_manager_is_supporting_a_free_masters/dixuco3]%0A%0ARemindMe! 4 years ) to send a PM to also be reminded and to reduce spam. ^(Parent commenter can ) [^(delete this message to hide from others.)](http://np.reddit.com/message/compose/?to=RemindMeBot&subject=Delete Comment&message=Delete! dixvaea) _____ \|[^(FAQs)](http://np.reddit.com/r/RemindMeBot/comments/24duzp/remindmebot_info/)\|[^(Custom)](http://np.reddit.com/message/compose/?to=RemindMeBot&subject=Reminder&message=[LINK INSIDE SQUARE BRACKETS else default to FAQs]%0A%0ANOTE: Don't forget to add the time options after the command.%0A%0ARemindMe!)\|[^(Your Reminders)](http://np.reddit.com/message/compose/?to=RemindMeBot&subject=List Of Reminders&message=MyReminders!)\|[^(Feedback)](http://np.reddit.com/message/compose/?to=RemindMeBotWrangler&subject=Feedback)\|[^(Code)](https://github.com/SIlver--/remindmebot-reddit)\|[^(Browser Extensions)](https://np.reddit.com/r/RemindMeBot/comments/4kldad/remindmebot_extensions/) \|-\|-\|-\|-\|-\|-\|", "title": "" }, { "docid": "ecf51c613d27aef311ab2aa2a9c16077", "text": "The fund prospectus is a good place to start.", "title": "" } ]	fiqa
fa6f5ddbefe4142238f1b5ed42e05cd7	How to get 0% financing for a car, with no credit score?	[ { "docid": "b72227cdfe352fa48872d135288cc532", "text": "Yes, of course it is. Car dealers are motivated to write loans even more than selling cars at times. When I bought a new car for the first time in my life, in my 40's, it took longer to get the finance guy out of my face than to negotiate and buy the car. The car dealer selling you the used car would be happy to package the financing into the selling price. Similar to how 'points' are used to adjust the actual cost of a mortgage, the dealer can tinker with the price up front knowing that you want to stretch the payment out a bit. To littleadv's point, 3 months isn't long, I think a used car dealer wold be happy to work with you.", "title": "" }, { "docid": "e8b6925e0d59707f0bd521bdc25cece7", "text": "Is it possible to get a 0% interest rate for car loan for used car in US? Possible? Yes. It's not illegal. Likely? Not really. $5K is not a very high amount, many banks won't even finance it at all, regardless of your credit score. I suggest you try local credit unions, especially those that your employer is sponsoring (if there are any). Otherwise, you will probably get horrible rates, but for 3 months - you can just take whatever, pay the 3 months interest and get rid of the loan as soon as you're able.", "title": "" } ]	[ { "docid": "454af89ce64a4b4e0a6d5a9c8c1f8ea5", "text": "\"I'd put more money down and avoid financing. I personally don't think car debt is good debt and if you can't afford the car, you are better off with a cheaper car. Also, you should read up on the 0% offer before deciding to commit. Here's one article that is slightly dated, but discusses some pros and cons of 0% financing. My main point though is that 0% financing is not \"\"free\"\" and you need to consider the cost of that financing before making the purchase. Aside from the normal loan costs of having a monthly payment, possibly buying too much car by looking at monthly cost, etc., a 0% financing offer usually forces you to give the dealer/financing company any rebates that are due to you, in essence making the car cost more.\"", "title": "" }, { "docid": "438bad75d87d85c9b5fcb2144e7da298", "text": "Ideally you would negotiate a car price without ever mentioning: And other factors that affect the price. You and the dealer would then negotiate a true price for the car, followed by the application of rebates, followed by negotiating for the loan if there is to be one. In practice this rarely happens. The sales rep asks point blank what rebates you qualify for (by asking get-to-know-you questions like where you work or if you served in the armed forces - you may not realize that these are do-you-qualify-for-a-rebate questions) before you've even chosen a model. They take that into account right from the beginning, along with whether they'll make a profit lending you money, or have to spend something to subsidize your zero percent loan. However unlike your veteran's status, your loan intentions are changeable. So when you get to the end you can ask if the price could be improved by paying cash. Or you could try putting the negotiated price on a credit card, and when they don't like that, ask for a further discount to stop you from using the credit card and paying cash.", "title": "" }, { "docid": "322a5c40e4c81d952476c0acfbd4c64e", "text": "\"One of the factors of a credit score is the \"\"length of time revolving accounts have been established\"\". Having a credit card with any line of credit will help in this regard. The account will age regardless of your use or utilization. If you are having issues with credit limits and no credit history, you may have trouble getting financing for the purchase. You should be sure you're approved for financing, and not just that the financing option is \"\"available\"\" (potentially with the caveat of \"\"for well qualified borrowers\"\"). Generally, if you've gotten approved for financing, that will come in the form of another credit card account (many contracting and plumbing companies will do this in hopes you will use the card for future purchases) or a bank loan account (more common for auto and home loans). With the credit card account, you might be able to perform a balance transfer, but there are usually fees associated with that. For bank loan accounts, you probably can't pay that off with a credit card. You'll need to transfer money to the account via ACH or send in a check. In short: I wouldn't bet on paying with your current credit card to get any benefit. IANAL. Utilizing promotional offers, whether interest-free for __ months, no balance transfer fees, or whatever, and passing your debt around is not illegal, not fraudulent, and in many cases advised (this is a link), though that is more for people to distribute utilization across multiple cards, and to minimize interest accrued. Many people, myself included, use a credit card for purchasing EVERYTHING, then pay it off in full every month (or sometimes immediately) to reap the benefit of cash back rewards and other cardholder benefits. I've also made a major payment (tuition, actually) on a Discover card, and opened up a new Visa card with 18-months of no interest and no balance transfer fees to let the bill sit for 12 months while I finished school and got a job.\"", "title": "" }, { "docid": "ac5e3eceb0f3f7efed7542521895e212", "text": "I have gotten a letter of credit from my credit union stating the maximum amount I can finance. Of course I don't show the dealer the letter until after we have finalized the deal. I Then return in 3 business days with a cashiers check for the purchase price. In one case since the letter was for an amount greater then the purchase price I was able drive the car off the lot without having to make a deposit. In another case they insisted on a $100 deposit before I drove the car off the lot. I have also had them insist on me applying for their in-house loan, which was cancelled when I returned with the cashiers check. The procedure was similar regardless If I was getting a loan from the credit union, or paying for the car without the use of a loan. The letter didn't say how much was loan, and how much was my money. Unless you know the exact amount, including all taxes and fees,in advance you can't get a check in advance. If you are using a loan the bank/credit Union will want the car title in their name.", "title": "" }, { "docid": "d48785f98d580c2f0bba55a4e048f87c", "text": "\"You do not say what country you are in. This is an answer for readers in the UK. Most normal balance transfer deals are only for paying off other credit cards. However there are \"\"money transfer\"\" deals that will pay the money direct to your bank account. The deals aren't as good as balance transfer deals but they are often a competitive option compared to other types of borrowing. Another option depending on how much you need to borrow and your regular spending habits is to get a card with a \"\"0% for purchases\"\" deal and use that card for your regular shopping, then put the money you would have spent on your regular shopping towards the car.\"", "title": "" }, { "docid": "c04766bd3dd7726caf75ff1eeab53a63", "text": "\"Your use of the term \"\"loan\"\" is confusing, what you're proposing is to open a new card and take advantage of the 0% APR by carrying a balance. The effects to your credit history / score will be the following:\"", "title": "" }, { "docid": "4eaf0ece65e124c8ee239f8b0f7821d9", "text": "I've seen credit cards that provide you your credit score for free, updated once a month and even charted over the last year. Unfortunately the bank I used to have this card with was bought and the purchasing bank discontinued the feature. Perhaps someone out there knows of some cards that still offer a feature like this?", "title": "" }, { "docid": "979150f0ed4d6e0a2bded0486e3ed0a7", "text": "\"They aren't actually. It appears to be a low interest rate, but it doesn't cover their true cost of capital. It is a sales tactic where they are raising the sticker price/principal of the car, which is subsidizing the true cost of the loan, likely 4% or higher. It would be hard to believe that the true cost of a car loan would be less than for a mortgage, as with a mortgage the bank can reclaim an asset that tends to rise in value, compared to a used car, which will have fallen in value. This is one reason why you can generally get a better price with cash, because there is a margin built in, in addition to the fact that with cash they get all their profit today versus a discount of future cash flows from a loan by dealing with a bank or other lending company. So if you could see the entire transaction from the \"\"inside\"\", the car company would not actually be making money. The government rate is also so low that it often barely covers inflation, much less operating costs and profit. This is why any time you see \"\"0% Financing!\"\", it is generally a sales tactic designed to get your attention. A company cannot actually acquire capital at 0% to lend to you at 0%, because even if the nominal interest rate were 0%, there is an opportunity cost, as you have observed. A portion of the sticker price is covering the real cost, and subsidizing the monthly payment.\"", "title": "" }, { "docid": "2afc463c2de196296f20f632d9d0fe12", "text": "If you're getting 0% on the financing, it's not costing you anything to borrow that money. So its basically free money. If you are comfortable with the monthly payments, consider going with no downpayment at all. Keep that money aside for a rainy day, or invest it somewhere so that you get some return on it. If you need to lower the payments later you can always use that money to pay down part of the loan later (check with the dealer that it is an open loan). If you're not comfortable with the payments at 0 down, put enough down to bring the monthly payment to a level where you are comfortable.", "title": "" }, { "docid": "c584db6ae2f9e3b6d480b9df41e05090", "text": "\"I cannot stress this enough, so I'll just repeat it: Don't plan your finances around your credit score. Don't even think about your credit score at all. Plan a budget an stick to it. Make sure you include short and long term savings in your budget. Pay your bills on time. Use credit responsibly. Do all of these things, and your credit rating will take care of itself. Don't try to plan your finances around raising it. On the subject of 0% financing specifically, my rule of thumb is to only ever use it when I have enough money saved up to buy the thing outright, and even then only if my budget will still balance with the added cost of repaying the loan. Other people have other rules, including not taking such loans at all, and you should develop a rule that works for you (but you should have a rule). One rule shouldn't have is \"\"do whatever will optimize your credit score\"\" because you shouldn't plan your finances around your credit score. All things considered, I think the most important thing in your situation is to make sure that you don't let the teaser rate tempt you into making purchases you wouldn't otherwise make. You're not really getting free money; you're just shifting around the time frame for payment, and only within a limited window at that. Also, be sure to read the fine print in the credit agreement; they can be filled with gotchas and pitfalls. In particular, if you don't clear the balance by the end of the introductory rate period, you can sometimes incur interest charges retroactively to the date of purchase. Make sure you know your terms and conditions cold. It sounds like you're just getting started, so best of luck, and remember that Rome wasn't built in a day. Patience can be the most effective tool in your personal finance arsenal. p.s. Don't plan your finances around your credit score.\"", "title": "" }, { "docid": "62dd8f3fad6b4b470a2221f4f6f7f2f1", "text": "These are the things to focus on... do not put yourself in debt with a car, there are other better solutions. 1) Get a credit card (Unless you already have one) -Research this and get the best cash back or points card you can get at the best rate. - Start with buying gas and groceries every month do not run the balance up. - Pay the card off every single month. (THIS IS IMPORTANT) - Never carry a balance above 25% of your credit limit. - Every 8 months or so call your credit card company and ask for a credit line increase. They should be able to do this WITHOUT pulling your credit you are only looking for the automatic increment that they can automatically approve. This will help increase your available credit and will help keep your credit utilization low. Only do this is you are successfully doing the other bullet points above. 2) Pay all of your bills on time, this includes everything from water, electricity, phone bill, etc. never be late. Setup automatic payments if you can. 3) Minimize the number of hard credit inquiries. -This is particularly important when you are looking for your mortgage lender. Do not let them pull your credit automatically. You should be able to provide them your credit score and other information and get quotes from those lenders. Do not let them tell you then can't do this... they can. 4)Strategically plan when you close a credit line, closing them will do two things, lower your credit limit often times increasing your credit utilization, and it may hurt your average age of credit. Open one credit card and keep it forever. *Note: Credit Karma is a great tool, you should check your score monthly and see how your efforts are influencing your score. I also like Citi credit cards because they will provide you monthly with your FICO Score which Credit Karma will only provide TransUnion and Equifax. This is educational information and you should consider talking to a banker/lender who can also give you more detailed instructions on how to get your credit improved so that they can approve you for a loan. Many people can get their score above 720 in 1-2 years time going from no credit doing the steps described above. It does take time be patient and don't fall for gimmicks.", "title": "" }, { "docid": "2cca0a2454c5d2a973e3406de16af154", "text": "I used to do this all the time but it's more difficult now. Just a general warning that this probably isn't a good idea unless you're very responsible with your money because it's easy to get yourself in a bad position if you're not careful. You can get a new credit card that does balance transfers and request balance transfer checks from them. Then just use one of those balance transfer checks to mail a payment to the loan you want to transfer. Make sure your don't use the entire credit line as the credit card will have the balance transfer fee put on it as well. You used to be able to find credit cards with 0% balance transfer fee but I haven't seen one of those in ages. Chase Slate is the lowest I've seen recently at 2%. Alternately, if you have a lot of expenses every month then it's easy to find a credit card where all purchases are 0% interest for a year or more and use that to pay every possible expense for a few months and use the money you'd normally use to pay for those expenses to pay off the original loan. If you're regular monthly expenses are high enough you can pay off the original loan quickly and then pay on the credit card with no interest as normal. The banks are looking to hook you so make sure you pay them off before the zero percent runs out or make sure you know what happens after it does. Normally the rate sky rockets. Also, don't use that card for anything else. Credit card companies always put payments towards the lowest interest rate first so if you charge something that doesn't qualify for 0% then it will collect interest until you've paid off the entire 0% balance which will likely take a while and cost you a lot of money. If you have to pay a balance transfer fee then figure out if it's less then you would have paid if you continued paying interest on the original loan. Good luck. I hope it works out for you.", "title": "" }, { "docid": "2a4e4589e77150edb6090a7c725d0b86", "text": "I am going to give advice that is slightly differently based on my own experiences. First, regarding the financing, I have found that the dealers do in fact have access to the best interest rates, but only after negotiating with a better financing offer from a bank. When I bought my current car, the dealer was offering somewhere around 3.3%, which I knew was way above the current industry standard and I knew I had good credit. So, like I did with my previous car and my wife's car, I went to local and national banks, came back with deals around 2.5 or 2.6%. When I told the dealer, they were able to offer 2.19%. So it's ok to go with the dealer's financing, just never take them at face value. Whatever they offer you and no matter how much they insist it's the best deal, never believe it! They can do better! With my first car, I had little credit history, similar to your situation, and interest rates were much higher then, like 6 - 8%. The dealer offered me 10%. I almost walked out the door laughing. I went to my own bank and they offered me 8%, which was still high, but better than 10%. Suddenly, the dealer could do 7.5% with a 0.25% discount if I auto-pay through my checking account. Down-payment wise, there is nothing wrong with a 35% down payment. When I purchased my current car, I put 50% down. All else being equal, the more cash down, the better off you'll be. The only issue is to weigh that down payment and interest rate against the cost of other debts you may have. If you have a 7% student loan and the car loan is only 3%, you're better off paying the minimum on the car and using your cash to pay down your student loan. Unless your student loan balance is significantly more than the 8k you need to finance (like a 20k or 30k loan). Also remember that a car is a depreciating asset. I pay off cars as fast as I can. They are terrible debt to have. A home can rise in value, offsetting a mortgage. Your education keeps you employed and employable and will certainly not make you dumber, so that is a win. But a car? You pay $15k for a car that will be worth $14k the next day and $10k a year from now. It's easy to get underwater with a car loan if the down payment is small, interest rate high, and the car loses value quickly. To make sure I answer your questions: Do you guys think it's a good idea to put that much down on the car? If you can afford it and it will not interfere with repayment of much higher interest debts, then yes. A car loan is a major liability, so if you can minimize the debt, you'll be better off. What interest rate is reasonable based on my credit score? I am not a banker, loan officer, or dealer, so I cannot answer this with much credibility. But given today's market, 2.5 - 4% seems reasonable. Do you think I'll get approved? Probably, but only one way to find out!", "title": "" }, { "docid": "622984b8033b727d4951db3c6a07fbe2", "text": "There many car loans at zero percent interest. Finance the car at zero percent, then take your money and invest it. If you want to be super safe buy a CD the same length as the car loan. 5 years you will get 2%. If you still want safety and a better return take up a asset allocation strategy that moves your cash to risky assets when the market is performing well, then to cash, bonds, or cds when the market under-performs. Now you have your car with a zero percent loan and you are making the return on the money instead of the car company.", "title": "" }, { "docid": "b3308e4c8f1bb1711105dc3cb749bb0b", "text": "Here's my take: 1) Having a car loan and paying it on time helps build credit. Not as much as having credit cards (and keeping them paid or carrying balance just enough to be reported and then paying it), but it counts. 2) Can't you set in your bank, not the lender, something to pay the car automagically for you? Then you will be paying it on time without having to think on it. 3) As others said, do read the fine print.", "title": "" } ]	fiqa
e8dc3f06fcdac2063079e71a4ffb967d	Can a Line of Credit be re-financed? Is it like a mortgage, with a term?	[ { "docid": "11b04f0fbfb3e324a843338805c16c9e", "text": "HELOCs typically have a 10 year draw and 5 year payback. During the draw time you can pay interest only if you wish. The rate can range from Prime minus 1.5 to Prime plus (quite a bit). Of course, you can always shop around for a better deal than you currently have so long as you have equity in your home.", "title": "" }, { "docid": "9ec7b68c5d7084261ee84d647e915358", "text": "You can often convert the outstanding balance of a HELOC into a fixed-rate home equity loan, generally with the same bank. Doing this can open possibilities to extend the term allowing for lower monthly payments, but resulting in a larger overall payoff cost. Most HELOCs allow for an interest-only payment or in some cases no-payment at all if you still have unused available credit. Not advising that you do this. If you are struggling with the size of the payment converting to a fixed-rate, fixed-term loan may be what you need. The key will be getting the term such that you can manage both the principal and interest that will be included in the payment.", "title": "" } ]	[ { "docid": "f34ae6731ec7e2a6fc4ab50ff0ac7e1e", "text": "\"It has been reported in consumer media (for example Clark Howard's radio program) that the \"\"no interest for 12 months\"\" contracts could trick you with the terms and the dates on the contract. Just as an example: You borrow $1000 on 12/1/2013, same as cash for 12 months. The contract will state the due date very clearly as 12/1/2014. BUT they statements you get will take payment on the 15th of each month. So you will dutifully pay your statements as they come in, but when you pay the final statement on 12/15/2014, you are actually 14 days late, have violated the terms, and you now owe all the interest that accumulated (and it wasn't a favorable rate). That doesn't happen all the time. Not all contracts are written that way. But you better read your agreement. Some companies use the same as cash deal because they want to move product. Some do it because they want to trick you with financing. Bottom line is, you better read the contract.\"", "title": "" }, { "docid": "300215e28bd985700295a949b4055d8c", "text": "You don't always have a choice. If you RTA, this is about loans that BoA bought from other lenders, or banks they acquired. If there is such a thing as a conventional mortgage contract that cannot be sold to another bank, I have never heard of it. Any bank you borrow from is generally free to re-sell the loan to any other bank. You agree to the contract, not the name on the letterhead.", "title": "" }, { "docid": "84da15fcc9d360379289e1a748504713", "text": "The loan is very likely to be syndicated, yes. I only state 7-10 because all of our loans to this point have been 7 year terms. And in many ways, this loan is just one of those loans, multiplied out in a modular sense.", "title": "" }, { "docid": "da9bc8b786e7314a869004e0ffd56ad0", "text": "\"So there are a few angles to this. The previous answers are correct in saying that cash is different than financing and, therefore, the dealer can rescind the offer. As for financing, the bank or finance company can give the dealership a \"\"kickback\"\" or charge a \"\"fee\"\" based on the customer's credit score. So everyone saying that the dealers want you to finance....well yes, so long as you have good credit. The dealership will make the most money off of someone with good credit. The bank charges a fee to the dealership for the loan to a customer with bad credit. Use that tactic with good credit...no problem. Use that tactic with bad credit.....problem.\"", "title": "" }, { "docid": "b9e30bba47df1f6be6546b3d553a685e", "text": "I doubt it. Securitizations refer to deals that issue tranched bonds backed by a specific cash flow asset. That asset can be mortgages, credit cards, auto loans, syndicated loans, aircraft loans, trade finance...pretty much any type of loan. - MBS refers to any securitization backed by mortgages. - CLO refers to any securitization backed by syndicated loans. - CMS refers to any securitization backed by commercial mortgage debt. - ABS refers to the rest (car loans, credit cards, airplanes, etc) CDO refers to a securitization of other securitizations. The underlying securitizations could be MBS, CLO, CMS, ABS, whatever. Most common CDOs are securitizations of MBS or CLO, with the vast majority being MBS from the go-go years '05-'07. And don't even get me started on synthetic structures. To my knowledge (and again I could be wrong here, please let me know if you've seen otherwise) the market for CDOs has been firmly dead since '07. ABS is still very active, although less than in the mid-oughts, and CLO is around still too. These two proved the best application of the concepts behind securitization: their underlying loans were truly diversified, so a general economic downturn hurt them less then the national collapse in the housing market. MBS issuance that does not involve Fannie/Freddie/Ginnie is rare but still exists. The lack of non-prime issuance of MBS is a huge reason for why the average American can't refi or take out a mortgage: there's no MBS issuance to package the loan into! Edit: typos", "title": "" }, { "docid": "5c3ee85ebbb20ccd9966af2e638bf2b1", "text": "\"As a legal contract, a mortgage is a form of secured debt. In the case of a mortgage, the debt is secured using the property asset as collateral. So \"\"no\"\", there is no such thing as a mortgage contract without a property to act as collateral. Is it a good idea? In the current low interest rate environment, people with good income and credit can obtain a creditline from their bank at a rate comparable to current mortgage rates. However, if you wish to setup a credit line for an amount comparable to a mortgage, then you will need to secure it with some form of collateral.\"", "title": "" }, { "docid": "95aa604b620f683534d11c1fa380c470", "text": "You can. You can take out a conventional mortgage and keep the cash. A mortgage is nothing but a secured loan against your home. You can open a HELOC and treat it as a negative-equity bank-account. Note that both a mortgage and a HELOC tend to have significant up-front or administrative costs attached to them. It costs the loaning institution some money to ensure they are in a safe position, and they will want to pass it on to you. They don't want you taking out such a loan and not using it. On the other hand, the interest rates on such a loan are often much lower than interest rates on other loans. If you have a reliable source of significant income, getting a completely unsecured line of credit may be possible with a rate only a few percentage points higher than a HELOC without having to pay a cent in fees. The bank doesn't have to appraise your home or ensure ownership before such a loan, just assess income (which is easy, especially if you have a regular paycheck auto-deposited into an account at the same branch; toss in some signatures from your employer and good to go). If that is feasible, you could end up with a lower rate. Withdraw from the line of credit, pay off your other loans, then work to repay the line of credit. If an unsecured line of credit has a rate 1-3% higher than a secured one, and you are borrowing 5000$ against it and pay it off over 2 years, the total interest you would save from a secured line is about 50$-150$. Note that in some jurisdictions your home is protected against loss from bankruptcy, unless you have used it as collateral for a loan, or it is easier to claim the home if you are insolvent if you have used it as collateral. Determining what the consequences of securing your loan against the house could itself be expensive.", "title": "" }, { "docid": "870bde1c950e8292feff5e71500a3590", "text": "How you answer is actually dependent on when they ask. If it is early in the process the question/answer is to determine the type of loan you are looking for: Auto loan, home loan, home improvement loans, education loans; all have products that are geared to those uses. In many cases they will use the item you are purchasing as collateral for the loan. In return for this they will offer you a low interest rate, because they know they can protect their money be repossessing the collateral. For these standard loans they will ask for more specifics before they give a check for the money because they need to know exactly what you are spending the money on, and they will need to file legal paperwork to protect their money. If it isn't one of those standard loans then you are looking at a loan that is only backed by your signature. That loan could have a high interest rate. They are asking as part of the process of assessing their risk. Unless you are putting a lie on a form, I am not sure being untruthful puts you in jeopardy. In some cases they don't care. People get lines of credit without knowing exactly what they are going to spend the money on.", "title": "" }, { "docid": "ee16483ea910357c03abbf4793181ce2", "text": "For alternative financing, pursue a line of credit or a Home Equity Line of Credit. (From the comments of @ChrisInEdmonton and @littleadv on the original question)", "title": "" }, { "docid": "393fe3161714ab5897fec44c4c53f2bb", "text": "The eligibilty of the deduction is based on what the borrowed money is used to purchase and NOT what asset is used as collateral. So at the beginning of your mortgage, 10% of the interest is deductible because the entire loan was used to purchase the condo. But when you withdraw money from the account the additional interest is usually not deductible. It can get confusing with all the withdrawals and payments that will be coming in and out of the account if you happen to use it a lot like a chequing account. An easy example would be if you only paid the interest on the loan... Say you had a $100 000 loan at 5% APY (for simplicity's sake). After one year, you would have paid $5000 interest. $500 of the would be deductible given that your office is 10% of the condo. Then you buy a $1000 couch and continue to only pay interest for the next year. You would have paid $5100 interest... $5000 on money borrowed to buy the condo, and $100 on money borrowed to buy the couch. So you can still only deduct $500. What happens when you pay back $500 against the line of credit? Could you designate that 100% of the money should be applied to the non-deductible interest? Or does it have to applied proportionally? I don't know. I think it'd would be wise to separate the loans somehow. Manulife may even have some tools to facilitate that. However, I wouldn't recommend the Manulife One product. I looked into when I was buying my house two years ago, and at that time it was too expensive. The rate was the same that other banks were charging for a home equity line of credit (which was prime at the time). You can replicate the Manulife One in a cheaper way using a traditional mortgage and a home equity line of credit... The majority of the loan will be the traditional mortgage at (hopefully) a cheap rate. Then you can use your line of credit as the chequing account.", "title": "" }, { "docid": "1e3c9a845584e08ecfa215e7bd63a708", "text": "Also - the more credit facilities you have, the risikier you get. Say Company A lends you $8.000 for a down-payment - let's say you then go out and max out your other 100k facilities - you now have debt of 108k. What guarantee does the Company A have of repayment? Fewer credit facilities = better chance of getting a new loan.", "title": "" }, { "docid": "5ff51bb08b4aeeae40dc724aa5bd53bf", "text": "If you go traditional financing there is a chance it'd be syndicated amongst a bank group. That is going to add a little depth to your credit agreement id imagine. You thinking a term loan with a 7-10 amortization? I've never seen a LOC more than 5 years out.", "title": "" }, { "docid": "beb3f083af599d46d40746bcc6f23dda", "text": "\"I think everything in your case is just simply missing one important rule of how credit works. Essentially, your MIL cannot get a loan. You can. You are making her a large loan that she cannot get for herself. That is all. That is the essence of what this deal is. It is not without interest - she makes a financial contribution toward your son, you get the deal in 2 years assuming she doesn't default (she will), etc. Imagine it this way: you are sitting in the dealership with the dealer and your MIL. She wants a loan to pay for the car. The dealership says, \"\"you are way not credit worthy.\"\" So your MIL says, \"\"why doesn't my son-in-law take out the loan instead?\"\" Now the dealership says, sure, that's fine. From the dealer's standpoint, every other part of your arrangement is irrelevant - boring, even. The only magic trick is in who takes the loan out, no other difference. You're letting your MIL pull a car out of her sleeve like a magician, and in taking the deal you're believing her. This sentence: I am pretty sure that the ex-MIL will not let me down (I've loaned her large sums of money before and she always promptly repaid). is everything. You're making a rather large bet that the things that can go wrong in two years - including any situation involving your wife's welfare - are rather miniscule. And furthermore, that the few times she's paid you back - that did NOT convince banks and dealer she is more creditworthy - justifies her good creditworthiness. Is the interest worth it? Do you really believe that your MIL needs to wring a car out of you before she would consider contributing to her grandson's well-being (which is, essentially, the interest)? But wait, it's NOT everything. Her daughter (my ex-wife) would drive it for 2 years and then turn the car over to our son. Even if your MIL is creditworthy, the woman you described as follows: Her daughter, though, is a loose cannon. Will be holding and returning the collateral in this deal. Things she can do include: So I'm arguing two points: Obviously my opinion on this is clear. I hope I did a decent job of explaining where the components of this deal (credit, interest, collateral) play out in the eyes of a dealer or bank, and get lost in the mechanics of the rules you worked out with your family.\"", "title": "" }, { "docid": "77d9180f70d0802c2ce787ee20f2097e", "text": "\"In a domestic setting, Letters of Credit are often used to build public works needed to support a development. So if you're bulldozing a few 3 story buildings to build a 50 story tower, the municipality will build appropriate water/sewer/gas/road infrastructure, and draw from the developer's letter of credit to fund it. The 'catch' to the developer is that these things usually aren't revokable -- once the city/town/etc starts work, the developer cannot cut-off the funding, even if the project is cancelled. A letter of credit definitely isn't a consumer financing vehicle. The closest equivalent is a \"\"line of credit\"\" tied to an asset like a home.\"", "title": "" }, { "docid": "e6f1d19cabf90155f2b068d25e4652a5", "text": "You could do that once, maybe, if the lender negotiates rather than going to court and taking you for everything you have plus having you wages garnished for the next several decades. And in the process, you would destroy your credit rating, making it impossible to borrow again any time soon. Doing this deliberately is fraud ... But worse than that, it's blatently stupid. You are likely to lose far more than you could gain.", "title": "" } ]	fiqa
b746a77e5125f748d361f4d58973a451	When to hire an investment professional?	[ { "docid": "9d67e11a7c3b69dc6f4b90c0aaaa9054", "text": "I don't know what you mean by 'major'. Do you mean the fund company is a Fidelity or Vanguard, or that the fund is broad, as in an s&P fund? The problem starts with a question of what your goals are. If you already know the recommended mix for your age/risk, as you stated, you should consider minimizing the expenses, and staying DIY. I am further along, and with 12 year's income saved, a 1% hit would be 12% of a year's pay, I'd be working 1-1/2 months to pay the planner? In effect, you are betting that a planner will beat whatever metric you consider valid by at least that 1% fee, else you can just do it yourself and be that far ahead of the game. I've accepted the fact that I won't beat the average (as measured by the S&P) over time, but I'll beat the average investor. By staying in low cost funds (my 401(k) S&P fund charges .05% annual expense) I'll be ahead of the investors paying planner fees, and mutual fund fees on top of that. You don't need to be a CFP to manage your money, but it would help you understand the absurdity of the system.", "title": "" }, { "docid": "cfd478d226d5f0f72d641deb377479fb", "text": "Don't invest in regular mutual funds. They are a rip-off. And, most investment professionals will not do much to help your financial future. Here's the advice:", "title": "" }, { "docid": "88e299ae89dcf52f5637fbf7df9cc1f1", "text": "\"Lifecycle funds might be a suitable fit for you. Lifecycle funds (aka \"\"target date funds\"\") are a mutual fund that invests your money in other mutual funds based on how much time is left until you need the money-- they follow a \"\"glide-path\"\" of reducing stock holdings in favor of bonds over time to reduce volatility of your final return as you near retirement. The ones I've looked at don't charge a fee of their own for this, but they do direct your portfolio to actively managed funds. That said, the ones I've seen have an \"\"acquired\"\" expense ratio of less than what you're proposing you'd pay a professional. FWIW, my current plan is to invest in a binary portfolio of cheap mutual funds that track S&P500 and AGG and rebalance regularly. This is easy enough that I don't see the point of adding in a 1 percent commission.\"", "title": "" } ]	[ { "docid": "bc8f593c174368c4c817cd8ea5e13e90", "text": "Picking yourself is just what all the fund managers are trying to do, and history shows that the majority of them fails the majority of the time to beat the index fund. That is the core reason of the current run after index funds. What that means is that although it doesn’t sound so hard, it is not easy at all to beat an index consistently. Of course you can assume that you are better than all those high-paid specialists, but I would have some doubt. You might be luckier, but then you might be not.", "title": "" }, { "docid": "3baa242993cb5b6cc6ab13e6fa977495", "text": "Consistently beating the market by picking stocks is hard. Professional fund managers can't really do it -- and they get paid big bucks to try! You can spend a lot of time researching and picking stocks, and you may find that you do a decent job. I found that, given the amount of money I had invested, even if I beat the market by a couple of points, I could earn more money by picking up some moonlighting gigs instead of spending all that time researching stocks. And I knew the odds were against me beating the market very often. Different people will tell you that they have a sure-fire strategy that gets returns. The thing I wonder is: why are you selling the information to me rather than simply making money by executing on your strategy? If they're promising to beat the market by selling you their strategy, they've probably figured out that they're better off selling subscriptions than putting their own capital on the line. I've found that it is easier to follow an asset allocation strategy. I have a target allocation that gives me fairly broad diversification. Nearly all of it is in ETFs. I rebalance a couple times a year if something is too far off the target. I check my portfolio when I get my quarterly statements. Lastly, I have to echo JohnFx's statement about keeping some of your portfolio in cash. I was almost fully invested going into early 2001 and wished I had more cash to invest when everything tanked -- lesson learned. In early 2003 when the DJIA dropped to around 8000 and everybody I talked to was saying how they had sold off chunks of their 401k in a panic and were staying out of stocks, I was able to push some of my uninvested cash into the market and gained ~25% in about a year. I try to avoid market timing, but when there's obvious panic or euphoria I might under- or over-allocate my cash position, respectively.", "title": "" }, { "docid": "db2a1f2268973febdb8fa42dde26c39e", "text": "It really is dependent upon your goals. What are your short term needs? Do you need a car/clothing/high cost apartment/equipment when you start your career? For those kinds of things, a savings account might be best as you will need to have quick access to cash. Many have said that people need two careers, the one they work in and being an investor. You can start on that second career now. Open up some small accounts to get the feel for investing. This can be index funds, or something more specialized. I would put money earmarked for a home purchase in funds with a lower beta (fluctuation) and some in index funds. You probably would want to get a feel for what and where you will actually be doing in your career prior to making a leap into a home purchase. So figure you have about 5 years. That gives you time to ride out the waves in the market. BTW, good job on your financial situation. You are set up to succeed.", "title": "" }, { "docid": "343d01b5f2726763ff0f0cd166d76d57", "text": "\"I'm still recommending that you go to a professional. However, I'm going to talk about what you should probably expect the professional to be telling you. These are generalities. It sounds like you're going to keep working for a while. (If nothing else, it'll stave off boredom.) If that's the case, and you don't touch that $1.4 million otherwise, you're pretty much set for retirement and never need to save another penny, and you can afford to treat your girl to a nice dinner on the rest of your income. If you're going to buy expensive things, though - like California real estate and boats and fancy cars and college educations and small businesses - you can dip into that money but things will get trickier. If not, then it's a question of \"\"how do I structure my savings?\"\". A typical structure: Anywho. If you can research general principles in advance, you'll be better prepared.\"", "title": "" }, { "docid": "fc8484f24d0c259e02cb1c1a590e2d52", "text": "\"A lot of investors prefer to start jumping into tools and figuring out from there, but I've always said that you should learn the theory before you go around applying it, so you can understand its shortcomings. A great starting point is Investopedia's Introduction to Technical Analysis. There you can read about the \"\"idea\"\" of technical analysis, how it compares to other strategies, what some of the big ideas are, and quite a bit about various chart patterns (cup and handle, flags, pennants, triangles, head & shoulders, etc). You'll also cover ideas like moving averages and trendlines. After that, Charting and Technical Analysis by Fred McAllen should be your next stop. The material in the book overlaps with what you've read on Investopedia, but McAllen's book is great for learning from examples and seeing the concepts applied in action. The book is for new comers and does a good job explaining how to utilize all these charts and patterns, and after finishing it, you should be ready to invest on your own. If you make it this far, feel free to jump into Fidelity's tools now and start applying what you've learned. You always want to make the connection between theory and practice, so start figuring out how you can use your new knowledge to generate good returns. Eventually, you should read the excellent reference text Technical Analysis of the Financial Markets by John Murphy. This book is like a toolbox - Murphy covers almost all the major techniques of technical analysts and helps you intuitively understand the reasoning behind them. I'd like to quote a part of a review here to show my point: What I like about Mr. Murphy is his way of showing and proving a point. Let me digress here to show you what I mean: Say you had a daughter and wanted to show her how to figure out the area of an Isosceles triangle. Well, you could tell her to memorize that it is base*height/2. Or if you really wanted her to learn it thoroughly you can show her how to draw a parallel line to the height, then join the ends to make a nice rectangle. Then to compute the area of a rectangle just multiply the two sides, one being the height, the other being half the base. She will then \"\"derive\"\" this and \"\"understand\"\" how they got the formula. You see, then she can compute the area under a hexagon or a tetrahedron or any complex object. Well, Mr. Murphy will show us the same way and \"\"derive\"\" for us concepts such as how a resistance line later becomes a support line! The reson for this is so amusing that after one reads about it we just go \"\"wow...\"\"\"\" Now I understand why this occurs\"\". Murphy's book is not about strategy or which tools to use. He takes an objective approach to describing the basics about various tools and techniques, and leaves it up to the reader to decide which tools to apply and when. That's why it's 576 pages and a great reference whenever you're working. If you make it through and understand Murphy, then you'll be golden. Again, understand the theory first, but make sure to see how it's applied as well - otherwise you're just reading without any practical knowledge. To quote Richard Feynman: It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong. Personally, I think technical analysis is all BS and a waste of time, and most of the top investors would agree, but at the end of the day, ignore everyone and stick to what works for you. Best of luck!\"", "title": "" }, { "docid": "7c1e38777f47d8af6a0319a751443f2a", "text": "If you're worried about investing all at once, you can deploy your starting chunk of cash gradually by investing a bit of it each month, quarter, etc. (dollar-cost averaging). The financial merits and demerits of this have been debated, but it is unlikely to lose you a lot of money, and if it has the psychological benefit of inducing you to invest, it can be worth it even if it results in slightly less-than-optimal gains. More generally, you are right with what you say at the end of your question: in the long run, when you start won't matter, as long as you continue to invest regularly. The Boglehead-style index-fund-based theory is basically that, yes, you might save money by investing at certain times, but in practice it's almost impossible to know when those times are, so the better choice is to just keep investing no matter what. If you do this, you will eventually invest at high and low points, so the ups and downs will be moderated. Also, note that from this perspective, your example of investing in 2007 is incorrect. It's true that a person who put money in 2007, and then sat back and did nothing, would have barely broken even by now. But a person who started to invest in 2007, and continued to invest throughout the economic downturn, would in fact reap substantial rewards due to continued investing throughout the post-2007 lows. (Happily, I speak from experience on this point!)", "title": "" }, { "docid": "7a239311eb2a819b7aadbbc3c95fa014", "text": "The very term 'market conditions' is subjective and needs context. There are 'market conditions' that favor buying (such as post crash) or market conditions that favor selling (such as the peak of a bubble). Problem with mutual funds is you can't really pick these points yourself; because you're effectively outsourcing that to a firm. If you're tight on time and are looking for weekly update on the economy a good solution is to identify a reputable economist (with a solid track record) and simply follow their commentary via blog or newsletter.", "title": "" }, { "docid": "8c0ef6f40ab8b479d6fb041cc7102d7d", "text": "It depends on a couple of things. One is your age -- if you're recently out of college that's totally fine; if you've been a professional for a long time then you may want to go a bit more formal. It also depends on the kind of investment firm and how client-facing the role / firm is. For example, I used to be at a firm where interviewing in shorts and a t-shirt would've been completely acceptable but I wouldn't suggest that at a white-shoe bank.", "title": "" }, { "docid": "b1007af655b10e89b18c690ccc5222ce", "text": "Not sure if you mean that your SO stands to inherit $18 million or has inherited it already. I would hope that her family already has a team of financial advisors at that point. The name of the game at that asset level is protection. You have enough money so you want to keep up with inflation and generate some income. Most of my firm's clients at that size have at least 50% in tax-free municipal bonds the other half is about 10% in aggressive investments (private equity, aggressive stock managers), and 25% in conservative stock investments, 5% in international investments, and 10% in alternative investments (long/short, GTAA, hedged equity) . They also tend to have quite a bit of income producing real estate. Make sure you meet with a financial advisory firm the specializes in high net worth clients. I work for an independent RIA so I may be biased towards independent and fee-only firms but it seems like the best arrangement. You pay a percentage of assets under management and get objective investment advice with no commissions. For $18 mil anything over .50% as an advisory fee is a ripoff. You all in investment cost should be less than 0.90%. Also you should look into a high net worth insurance broker. You current insurance salesman will be in way over his head. Feel free to PM me with specific questions. Also, if you want to hire my firm that would be great haha!", "title": "" }, { "docid": "ef0e9ae89d9c52b31c87383d6b21d9af", "text": "Financial advisers like to ask lots of questions and get nitty-gritty about investment objectives, but for the most part this is not well-founded in financial theory. Investment objectives really boils down to one big question and an addendum. The big question is how much risk you are willing to tolerate. This determines your expected return and most characteristics of your portfolio. The addendum is what assets you already have (background risk). Your portfolio should contain things that hedge that risk and not load up on it. If you expect to have a fixed income, some extra inflation protection is warranted. If you have a lot of real estate investing, your portfolio should avoid real estate. If you work for Google, you should avoid it in your portfolio or perhaps even short it. Given risk tolerance and background risk, financial theory suggests that there is a single best portfolio for you, which is diversified across all available assets in a market-cap-weighted fashion.", "title": "" }, { "docid": "a7bcd917fe07b351cca0a1b88d3050c8", "text": "\"I have money to invest. Where should I put it? Anyone who answers with \"\"Give it to me, I'll invest it for you, don't worry.\"\" needs to be avoided. If your financial advisor gives you this line or equivalent, fire him/her and find another. Before you think about where you should put your money, learn about investing. Take courses, read books, consume blogs and videos on investing in stocks, businesses, real estate, and precious metals. Learn what the risks and rewards are for each, and make an informed decision based on what you learned. Find differing opinions on each type of investment and come to your own conclusions for each. I for example, do not understand stocks, and so do not seriously work the stock market. Mutual funds make money for the folks selling them whether or not the price goes up or down. You assume all the risk while the mutual fund advisor gets the reward. If you find a mutual fund advisor who cannot recommend the purchase of a product he doesn't sell, he's not an advisor, he's a salesman. Investing in business requires you either to intimately understand businesses and how to fund them, or to hire someone who can make an objective evaluation for you. Again this requires training. I have no such training, and avoid investing in businesses. Investing in real estate also requires you to know what to look for in a property that produces cash flow or capital gains. I took a course, read some books, gained experience and have a knowledgeable team at my disposal so my wins are greater than my losses. Do not be fooled by people telling you that higher risk means higher reward. Risks that you understand and have a detailed plan to mitigate are not risks. It is possible to have higher reward without increasing risk. Again, do your own research. The richest people in the world do not own mutual funds or IRAs or RRSPs or TFSAs, they do their own research and invest in the things I mentioned above.\"", "title": "" }, { "docid": "83e390b206f77c6817392fdb90840f25", "text": "One of the key questions experts should ask when they first get started to work with a financial adviser or investment specialist is how they get paid for their expert services. There are generally four types of compensation plans for financial consultants.", "title": "" }, { "docid": "11d1400c8b9ac12d954f60d4ec289914", "text": "Depends on what you are, an investor or a speculator. An investor will look at an 'indefinite' investment period. A speculator will be after a fast buck. If you are an investor, buy your stock once as that will cost less commissions. After all, you'll sell your stock in 10, 15, 20 years.", "title": "" }, { "docid": "87fd0ffbacf2f9c408959b74bf24807b", "text": "I interned at a wealth management firm that used very active momentum trading, 99% technicals. Strictly ETFs (indexes, currencies, commodities, etc), no individual equities. They'd hold anywhere from 1-4 weeks, then dump it as soon as the chart starts turning over. As soon as I get enough capital I'm adopting their same exact strategy, it's painfully easy", "title": "" }, { "docid": "370145bbca8c2860511a87564b212acc", "text": "I don't like your strategy. Don't wait. Open an investment account today with a low cost providers and put those funds into a low cost investment that represents as much of the market as you can find. I am going to start by assuming you are a really smart person. With that assumption I am going to assume you can see details and trends and read into the lines. As a computer programmer I am going to assume you are pretty task oriented, and that you look for optimal solutions. Now I am going to ask you to step back. You are clearly very good at managing your money, but I believe you are over-thinking your opportunity. Reading your question, you need a starting place (and some managed expectations), so here is your plan: Now that you have a personal retirement account (IRA, Roth IRA, MyRA?) and perhaps a 401(k) (or equivalent) at work, you can start to select which investments go into that account. I know that was your question, but things you said in your question made me wonder if you had all of that clear in your head. The key point here is don't wait. You won't be able to time the market; certainly not consistently. Get in NOW and stay in. You adjust your investments based on your risk tolerance as you age, and you adjust your investments based on your wealth and needs. But get in NOW. Over the course of 40 years you are likely to be working, sometimes the market will be up, and sometimes the market will be down; but keep buying in. Because every day you are in, you money can grow; and over 40 years the chances that you will grow substantially is pretty high. No need to wait, start growing today. Things I didn't discuss but are important to you:", "title": "" } ]	fiqa
84e3047d1a4c36a496832f723e1e34eb	How do annual risks translate into long-term risks?	[ { "docid": "1e77c8b4df0b2547a309756256605859", "text": "\"The short answer is the annualised volatility over twenty years should be pretty much the same as the annualised volatility over five years. For independent, identically distributed returns the volatility scales proportionally. So for any number of monthly returns T, setting the annualization factor m = 12 annualises the volatility. It should be the same for all time scales. However, note the discussion here: https://quant.stackexchange.com/a/7496/7178 Scaling volatility [like this] only is mathematically correct when the underlying price model is driven by Geometric Brownian motion which implies that prices are log normally distributed and returns are normally distributed. Particularly the comment: \"\"its a well known fact that volatility is overestimated when scaled over long periods of time without a change of model to estimate such \"\"long-term\"\" volatility.\"\" Now, a demonstration. I have modelled 12,000 monthly returns with mean = 3% and standard deviation = 2, so the annualised volatility should be Sqrt(12) * 2 = 6.9282. Calculating annualised volatility for return sequences of various lengths (3, 6, 12, 60 months etc.) reveals an inaccuracy for shorter sequences. The five-year sequence average got closest to the theoretically expected figure (6.9282), and, as the commenter noted \"\"volatility is [slightly] overestimated when scaled over long periods of time\"\". Annualised volatility for varying return sequence lengths Edit re. comment Reinvesting returns does not affect the volatility much. For instance, comparing some data I have handy, the Dow Jones Industrial Average Capital Returns (CR) versus Net Returns (NR). The return differences are somewhat smoothed, 0.1% each month, 0.25% every third month. More erratic dividend reinvestment would increase the volatility.\"", "title": "" } ]	[ { "docid": "be8cc9df94ea427b68eba92216842cbc", "text": "I find the higher estimates a bit unbelievable. A big part of my job is liability valuation and small assumption changes can have a huge impact on results. They may be right (future) dollar value wise but the proper way to think about this stuff is in present value terms. This could actually be a really interesting study - you all just gave me a great idea for a potential masters thesis :)", "title": "" }, { "docid": "d1791a006cbced74f19d94ae64a7dc2e", "text": "Since near-term at-the-money (ATM) options are generally the most liquid, the listed implied vol for a stock is usually pretty close to the nearest ATM volatility, but there's not a set convention that I'm aware of. Also note that for most stocks, vol skew (the difference in vol between away-from-the-money and at-the-money options) is relatively small, correct me if I'm wrong, IV is the markets assessment that the stock is about 70% likely (1 Standard Deviation) to move (in either direction) by that percent over the next year. Not exactly. It's an annualized standard deviation of the anticipated movements over the time period of the option that it's implied from. Implied vol for near-term options can be higher or lower than longer-term options, depending on if the market believes that there will be more uncertainty in the short-term. Also, it's the bounds of the expected movement in that time period. so if a stock is at $100 with an implied vol of 30% for 1-year term options, then the market thinks that the stock will be somewhere between $70 and $130 after 1 year. If you look at the implied vol for a 6-month term option, half of that vol is the range of expected movement in 6 months.", "title": "" }, { "docid": "da9bcd80c4b84b951d5e8c1372a1ed05", "text": "\"This article is written by an idiot!! Risk ≠ failure, risk = possibility of failure Reward (return) should be commensurate with risk and this is why long-shot propositions should be worthwhile. An example of this could be something like the following; an investment with a 95% chance of success should return about 5% on the investment (1 in 20 risk of loss, 1/20th return on investment for taking the risk) while a long-shot investment with a 5% chance of success should be paying a 2000% return (1 in 20 will succeed but they will pay 20 times the investment if they do). An investment with a 0% chance of return (that you are suckered into due to \"\"opacity\"\") is not an investment, it is being robbed and it should be illegal. WTF is opacity? Lying?\"", "title": "" }, { "docid": "bdf902963e79c6b5e308997b48edab0a", "text": "I can think of a few simple and quick techniques for timing the market over the long term, and they can be used individually or in combination with each other. There are also some additional techniques to give early warning of possible turns in the market. The first is using a Moving Average (MA) as an indication of when to sell. Simply if the price closes below the MA it is time to sell. Obviously if the period you are looking at is long term you would probably use a weekly or even monthly chart and use a relatively large period MA such as a 50 week or 100 week moving average. The longer the period the more the MA will lag behind the price but the less false signals and whipsawing there will be. As we are looking long term (5 years +) I would use a weekly chart with a 100 week Exponential MA. The second technique is using a Rate Of Change (ROC) Indicator, which is a momentum indicator. The idea for timing the markets in the long term is to buy when the indicator crosses above the zero line and sell when it crosses below the zero line. For long term investing I would use a 13 week EMA of the 52 week ROC (the EMA smooths out the ROC indicator to reduce the chance of false signals). The beauty of these two indicators is they can be used effectively together. Below are examples of using these two indicators in combination on the S&P500 and the Australian S&P ASX200 over the past 20 years. S&P500 1995 to 2015 ASX200 1995 to 2015 If I was investing in an ETF tracking one of these indexes I would use these two indicators together by using the MA as an early warning system and maybe tighten any stop losses I have so that if the market takes a sudden turn downward the majority of my profits would be protected. I would then use the ROC Indicator to sell out completely out of the ETF when it crosses below zero or to buy back in when the ROC moves back above zero. As you can see in both charts the two indicators would have kept you out of the market during the worst of the downfalls in 2000 and 2008 for the S&P500 and 2008 for the ASX200. If there is a false signal that gets you out of the market you can quite easily get back in if the indicator goes back above zero. Using these indicators you would have gotten into the market 3 times and out of it twice for the S&P500 over a 20 year period. For the ASX200 you would have gone in 6 times and out 5 times, also over a 20 year period. For individual shares I would use the ROC indicator over the main index the shares belong to, to give an indication of when to be buying individual stocks and when to tighten stop losses and stay on the sidelines. My philosophy is to buy rising stocks in a rising market and sell falling stocks in a falling market. So if the ROC indicator is above zero I would be looking to buy fundamentally healthy stocks that are up-trending and place a 20% trailing stop loss on them. If I get stopped out of one stock then I would look to replace it with another as long as the ROC is still above zero. If the ROC indicator crosses below zero I would tighten my trailing stop losses to 5% and not buy any new stocks once I get stopped out. Some additional indicators I would use for individual stock would be trend lines and using the MACD as a momentum indicator. These two indicators can give you further early warning that the stock may be about to reverse from its current trend, so you can tighten your stop loss even if the ROC is still above zero. Here is an example chart to explain: GEM.AX 3 Year Weekly Chart Basically if the price closes below the trend line it may be time to close out the position or at the very least tighten up your trailing stop loss to 5%. If the price breaks below an established uptrend line it may well be the end of the uptrend. The definition of an uptrend is higher highs and higher lows. As GEM has broken below the uptrend line and has maid a lower low, all that is needed to confirm the uptrend is over is a lower high. But months before the price broke below the uptrend line, the MACD momentum indicator was showing bearish divergence between it and the price. In early September 2014 the price made a higher high but the MACD made a lower high. This is called a bearish divergence and is an early warning signal that the momentum in the uptrend is weakening and the trend could be reversing soon. Notice I said could and not would. In this situation I would reduce my trailing stop to 10% and keep a watchful eye on this stock over the coming months. There are many other indicators that could be used as signals or as early warnings, but I thought I would talk about some of my favourites and ones I use on a daily and weekly basis. If you were to employ any of these techniques into your investing or trading it may take a little while to learn about them properly and to implement them into your trading plan, but once you have done that you would only need to spend 1 to 2 hours per week managing your portfolio if trading long-term or about 1 hour per nigh (after market close) if trading more medium term.", "title": "" }, { "docid": "8b4d4b2faa01a03c992d0834a7b6d2f1", "text": "Stock index funds are likely, but not certainly, to be a good long-term investment. In countries other than the USA, there have been 30+ year periods where stocks either underperformed compared to bonds, or even lost value in absolute terms. This suggests that it may be an overgeneralization to assume that they always do well in the long term. Furthermore, it may suggest that they are persistently overvalued for the risk, and perhaps due for a long-term correction. (If everybody assumes they're safe, the equity risk premium is likely to be eaten up.) Putting all of your money into them would, for most people, be taking an unnecessary risk. You should cover some other asset classes too. If stocks do very well, a portfolio with some allocation to more stable assets will still do fairly well. If they crash, a portfolio with less risky assets will have a better chance of being at least adequate.", "title": "" }, { "docid": "7294853a49f545ac4cd90e8e3e97f261", "text": "What is the importance or benefit of the assumption that high-risk is preferable for younger people/investors instead of older people? Law of averages most high risk investments [stocks for examples, including Mutual funds]. Take any stock market [some have data for nearly 100 years] on a 15 year or 30 years horizon, the year on year growth is around 15 to 18 percentage. Again depends on which country, market etc ... Equally important every stock market in the same 15 year of 30 year time, if you take specific 3 year window, it would have lost 50% or more value. As one cannot predict for future, someone who is 55 years, if he catches wrong cycle, he will lose 50%. A young person even if he catches the cycle and loses 50%, he can sit tight as it will on 30 years average wipe out that loss.", "title": "" }, { "docid": "6133f6d083b06457fb1454a44b740a51", "text": "These scenarios discuss the period to 2025. They assess the deep uncertainty that is paralysing decision-taking. They identify the roots of this as the failure of the social model on which the West has operated since the 1920s. Related and pending problems imply that this situation is not recoverable without major change: for example, pensions shortfalls are greater in real terms that entire expenditure on World War II, and health care and age support will treble that. Due to the prolonged recession, competition will impact complex industries earlier than expected. Social responses which seek job protection, the maintenance of welfare and also support in old age will tear at the social fabric of the industrial world. There are ways to meet this, implying a major change in approach, and a characteristic way in which to fail to respond to it in time, creating a dangerous and unstable world. The need for such change will alter the social and commercial environment very considerably. The absence of such change will alter it even more. The summary is available [here](http://www.chforum.org/scenario2012/paper-4-6.shtml) or at the foot of the link given in the header. The much richer paper is [here](http://www.chforum.org/scenario2012/paper-4-1.shtml). These scenarios are the latest in a series in a project that dates back to 1995. Over a hundred people participated from every continent, over a six month period. The working documents are available on the web.", "title": "" }, { "docid": "b09a51e84be825a7bd9b5dd31aee855c", "text": "\"Some thoughts on your questions in order, Duration: You might want to look at the longest-dated option (often a \"\"LEAP\"\"), for a couple reasons. One is that transaction costs (spread plus commission, especially spread) are killer on options, so a longer option means fewer transactions, since you don't have to keep rolling the option. Two is that any fundamentals-based views on stocks might tend to require 3-5 years to (relatively) reliably work out, so if you're a fundamental investor, a 3-6 month option isn't great. Over 3-6 months, momentum, short-term news, short squeezes, etc. can often dominate fundamentals in determining the price. One exception is if you just want to hedge a short-term event, such as a pending announcement on drug approval or something, and then you would buy the shortest option that still expires after the event; but options are usually super-expensive when they span an event like this. Strike: Strike price on a long option can be thought of as a tradeoff between the max loss and minimizing \"\"insurance costs.\"\" That is, if you buy a deeply in-the-money put or call, the time value will be minimal and thus you aren't paying so much for \"\"insurance,\"\" but you may have 1/3 or 1/2 of the value of the underlying tied up in the option and subject to loss. If you buy a put or call \"\"at the money,\"\" then you might have only say 10% of the value of the underlying tied up in the option and subject to loss, but almost the whole 10% may be time value (insurance cost), so you are losing 10% if the underlying stock price stays flat. I think of the deep in-the-money options as similar to buying stocks on margin (but the \"\"implied\"\" interest costs may be less than consumer margin borrowing rates, and for long options you can't get a margin call). The at-the-money options are more like buying insurance, and it's expensive. The commissions and spreads add significant cost, on top of the natural time value cost of the option. The annual costs would generally exceed the long-run average return on a diversified stock fund, which is daunting. Undervalued/overvalued options, pt. 1: First thing is to be sure the options prices on a given underlying make sense at all; there are things that \"\"should\"\" hold, for example a synthetic long or short should match up to an actual long or short. These kinds of rules can break, for example on LinkedIn (LNKD) after its IPO, when shorting was not permitted, the synthetic long was quite a bit cheaper than a real long. Usually though this happens because the arbitrage is not practical. For example on LNKD, the shares to short weren't really available, so people doing synthetic shorts with options were driving up the price of the synthetic short and down the price of the synthetic long. If you did actually want to be long the stock, then the synthetic long was a great deal. However, a riskless arbitrage (buy synthetic long, short the stock) was not possible, and that's why the prices were messed up. Another basic relationship that should hold is put-call parity: http://en.wikipedia.org/wiki/Put%E2%80%93call_parity Undervalued/overvalued options, pt. 2: Assuming the relationship to the underlying is sane (synthetic positions equivalent to actual positions) then the valuation of the option could focus on volatility. That is, the time value of the option implies the stock will move a certain amount. If the time value is high and you think the stock won't move much, you might short the option, while if the time value is low and you think the stock will move a lot, you might buy the option. You can get implied volatility from your broker perhaps, or Morningstar.com for example has a bunch of data on option prices and the implied components of the price model. I don't know how useful this really is though. The spreads on options are so wide that making money on predicting volatility better than the market is pretty darn hard. That is, the spread probably exceeds the amount of the mispricing. The price of the underlying is more important to the value of an option than the assumed volatility. How many contracts: Each contract is 100 shares, so you just match that up. If you want to hedge 100 shares, buy one contract. To get the notional value of the underlying multiply by 100. So say you buy a call for $30, and the stock is trading at $100, then you have a call on 100 shares which are currently priced at $10,000 and the option will cost $30*100=3,000. You are leveraged about 3 to 1. (This points to an issue with options for individual investors, which is that one contract is a pretty large notional value relative to most portfolios.)\"", "title": "" }, { "docid": "2a690f0a2e0c41400119b5338b63d3b4", "text": "There's probably a risk committee and an investment committee where several high level executives analyze and discuss the investments they will do and which risk level to take. Is all based on numbers and evidence, but in the end people decide how much risk to take. Then there Risk Management I suppose supervises the risk and that they don't go over the threshold (measured by VAR or whatever)", "title": "" }, { "docid": "4fe71dad8b6df9ac042bb484b3097c02", "text": "I use two measures to define investment risk: What's the longest period of time over which this investment has had negative returns? What's the worst-case fall in the value of this investment (peak to trough)? I find that the former works best for long-term investments, like retirement. As a concrete example, I have most of my retirement money in equity, since the Sensex has had zero returns over as long as a decade. Since my investment time-frame is longer, equity is risk-free, by this measure. For short-term investments, like money put aside to buy a car next year, the second measure works better. For this purpose, I might choose a debt fund that isn't the safest, and has had a worst-case 8% loss over the past decade. I can afford that loss, putting in more money from my pocket to buy the car, if needed. So, I might choose this fund for this purpose, taking a slight risk to earn higher return. In any case, how much money I need for a car can only be a rough guess, so having 8% less than originally planned may turn out to be enough. Or it may turn out that the entire amount originally planned for is insufficient, in which case a further 8% shortfall may not be a big deal. These two measures I've defined are simple to explain and understand, unlike academic stuff like beta, standard deviation, information ratio or other mumbo-jumbo. And they are simple to apply to a practical problem, as I've illustrated with the two examples above. On the other hand, if someone tells me that the standard deviation of a mutual fund is 15%, I'll have no idea what that means, or how to apply that to my financial situation. All this suffers from the problem of being limited to historical data, and the future may not be like the past. But that affects any risk statistic, and you can't do better unless you have a time machine.", "title": "" }, { "docid": "b8c85057fde0b41a9ce1c46371684b2b", "text": "First, you need to understand how modern insurance companies operate. On the front end, they write contracts with customers, collecting up front premiums, and promising to pay out to cover future losses. Efficient premiums cover exactly what's paid out; if you charge too much customers leave for competition, and if you charge too little the company goes under, or at least loses money. Large armies of people are employed to accurately guess future risks, hopefully to the point of certainty you have in human mortality. So over time, they will pay back those premiums. And there's a constant stream of new premiums coming in to replace money going out. So there's this effective pool of money they can use to buffer against large losses with; it's called float. And when the pool of money remains relatively constant, they can invest it longer term than the people who comprise the underlying risk. Large insurance companies like Berkshire Hathaway function in this manner; it's where Warren Buffet finds capital to invest while hiding from Wall St in Nebraska. The way these companies profit is by making sure the equation works: Profits = Premiums - Payouts + Return on float Payouts could be just payments for insured risk. But they could also be for the whole life insurance you're running across from time to time. These contracts offer the insured the chance to invest their money with the people who invest the float. And as long as the return on float is greater than the return they're offering, it's still profitable for the company. Since this guarantees suboptimal returns for you, it's usually a good idea to buy term insurance (much cheaper) and invest the difference yourself.", "title": "" }, { "docid": "a397374dd48ae8d665e435d60a48fd6d", "text": "The obvious risk is that you might buy at a time when the market is particularly high. Of course, you won't know that is the case until afterwards. A common way to reduce that risk is dollar cost averaging, where you buy gradually over a period of time.", "title": "" }, { "docid": "83cdc3f29e96ce627f0bb5369a48319f", "text": "I don't think you can always assume a 12-month time horizon. Sometimes, the analyst's comments might provide some color on what kind of a time horizon they're thinking of, but it might be quite vague.", "title": "" }, { "docid": "759a233a96806f93816c5a6d2e5187e1", "text": "That's not true - insurance companies can manage that risk and look to Re-insure that risk with very large pools of risk capital through reinsurance. Government agencies traditionally have not looked to buy insurance but are now starting to insure such catastrophic risks. I believe the NFIP has some sort of excess risk cover such that if losses are greater than $500 million, then it triggers a payout from large private insurers.", "title": "" }, { "docid": "5d7736255f034e29a930b7eab8d3047c", "text": "\"Forecasts of stock market direction are not reliable, so you shouldn't be putting much weight on them. Long term, you can expect to do better in stocks, but obtaining this better expected return has the danger of \"\"buying in\"\" to the market at a particularly bad moment, leading to a substantially lower return. So mitigate that risk while moving in a big piece of cash by \"\"dollar cost averaging\"\". An example would be to divide your cash hoard (conceptually) into say six pieces, and invest each piece in the index fund two months apart. After a year you will have invested the whole sum at about the average of the index for the year.\"", "title": "" } ]	fiqa
0adec7c7ee0fcf6c0816daff4b82057d	My mother's name is on my car title, how can I protect my ownership of the car in the event of her death?	[ { "docid": "795e112ad3c0a82dbbb6c2ad2b694d40", "text": "It's her car. Unlike what Ross said in the comments she can't sign it over to you--she doesn't own it yet. The best you'll be able to do is have her leave it to you in her will--but beware that you very well might need to refinance the loan at that point.", "title": "" } ]	[ { "docid": "f2e56eec51fa0c7f632286583267210f", "text": "\"I think at this point you and the other person who seems to ask this question in multiple permutations needs to talk to a local expert rather than continuing to ask the same questions with slight fact variations. This all happened when you were 9. If you think there was foul play involved, at the minimum it will be difficult to prove 16 years on. Somehow I doubt there are 2 people on Toronto whose parents bought them whole life insurance policies in 2000 asking the same questions at the same time. If you don't want the coverage or you think the whole thing was a mistake, cash the policy out. According to the other question about this policy there's nearly $7,000 of cash value there. Just take the money out and move on with your life. Unless you're willing to sue your \"\"mentally ill\"\" mother over the $1,500 net loss ($530 premium times 16 years minus $7,000 cash value) I'm not sure what recourse or advice you're looking for. And even that assumes she's paying the premium with your money. Separately, if your mother is the owner of the policy and paying with her money I'm not sure why this involves you at all. Parents buy life insurance on their children all the time.\"", "title": "" }, { "docid": "fefedb73e7061bab2a239618cd3b88c2", "text": "It looks to me like this is a 'call an attorney' situation, which is always a good idea in situations like this (family legal disputes). But, some information. First off, if your family is going to take the car, you certainly won't need to make payments on it any more at that point, in my opinion. If the will goes through probate (which is the only way they'd really be able to take it), the probate judge should either leave you with the car and the payments, or neither (presumably requiring the family to pay off the loan and settle your interest in the car). Since the car has negative net value, it seems unlikely that the probate judge would take the car away from you, but who knows. Either way, if they do take the car away from you, they'll be doing you a service: you have a $6,000 car that you owe $12,000 on. Let them, and walk away and buy another car for $6,000. Second, I'm not sure they would be allowed to in any event. See the Illinois DMV page on correcting titles in the case of a deceased owner; Illinois I believe is a joint tenancy state, meaning that once one owner dies, the other just gets the car (and the loan, though the loan documents would cover that). Unless you had an explicit agreement with your grandfather, anyway. From that page: Joint Ownership A title in the names of two or more persons is considered to be in joint tenancy. Upon the death of one of them, the surviving joint tenant(s) becomes the owner(s) of the vehicle by law. Third, your grandfather can fix all of this fairly easily by mentioning the disposition of the car and loan in his will, if he's still mentally competent and wishes to do so. If he transfers his ownership of the car to you in the will, it seems like that would be that (though again, it's not clear that the ownership wouldn't just be yours anyway). Finally, I am not a lawyer, and I am not your lawyer, so do not construe any of the text of this post as legal advice; contact a lawyer.", "title": "" }, { "docid": "be2d7fa01fe5a2e48f5e6a4a268f77ab", "text": "\"You are co-signer on his car loan. You have no ownership (unless the car is titled in both names). One option (not the best, see below) is to buy the car from him. Arrange your own financing (take over his loan or get a loan of your own to pay him for the car). The bank(s) will help you take care of getting the title into your name. And the bank holding the note will hold the title as well. Best advice is to get with him, sell the car. Take any money left after paying off the loan and use it to buy (cash purchase, not finance) a reliable, efficient, used car -- if you truly need a car at all. If you can get to work by walking, bicycling or public transit, you can save thousands per year, and perhaps use that money to start you down the road to \"\"financial independence\"\". Take a couple of hours and research this. In the US, we tend to view cars as necessary, but this is not always true. (Actually, it's true less than half the time.) Even if you cannot, or choose not to, live within bicycle distance of work, you can still reduce your commuting cost by not financing, and by driving a fuel efficient vehicle. Ask yourself, \"\"Would you give up your expensive vehicle if it meant retiring years earlier?\"\" Maybe as many as ten years earlier.\"", "title": "" }, { "docid": "88fe24cde05bf585956540896d85f314", "text": "There is nothing illegal about a vehicle being in one person's name and someone else using it. An illegal straw purchase usually applies to something where, for example, the purchaser is trying to avoid a background check (as with firearms) or is trying to hide assets, so they use someone else to make the purchase on their behalf to shield real ownership. As for insurance, there's no requirement for you to own a vehicle in order to buy insurance so that you can drive someone else's vehicle. In other words, you can buy liability coverage that applies to any vehicle you're operating. The long and short of it here is that you're not doing anything illegal or otherwise improper,but I give you credit for having the good morals for wanting to make sure you're doing the right thing.", "title": "" }, { "docid": "735c8ce05f91b7ded0f1db14eb87d381", "text": "If it's in your name and you don't live there, there's a number of issues. If you charge her rent, it needs to be at fair value to treat it as a rental property. If she lives there for the next 20 years, it will (or we hope) gain value. If she passes while it's in her name you get to step up the basis, and avoid tax. If in your name , the gain would be taxable.", "title": "" }, { "docid": "c6e198232666031d75b8b46ac733eef8", "text": "\"Not to be a downer...but: Another thing to consider is an update to your \"\"accounts document\"\". By that I mean, your list of banks, account numbers, insurance policies, access information, etc. I'm told that keeping this information up to date and attached to your will can make a lot of things go far smoother in the event of an untimely passing. I should probably get on that myself...\"", "title": "" }, { "docid": "3e75f93da64387ecaa1aa9283f7e38ac", "text": "You're driving a car worth about $6000 which has a $12,000 loan against it. You're driving around in a nett debt of $6000. The best thing your grandfather could do for you, if possible, is to take your name off both the title and the loan, refinancing the car in his name only. If possible while still letting you drive the car. When he dies, you will be out of a car, but also out of a $12,000 debt which I'm sure you could do without. Okay, the best thing your grandfather could do, from your wallet's point of view, is paying off the loan for you and then taking his name off the title.", "title": "" }, { "docid": "25c80accc613ec73f5527afe291d030d", "text": "\"The wording of this question is very confusing because \"\"primary signer\"\" would, in ordinary parlance, mean the person borrowing the money and the co-signer (not consigner) would mean the one who is guaranteeing the repayment of the loan: if the borrower does not pay, the co-signer is liable for making the payments. Whose name is on the title of the car? Who borrowed the money to buy the car? Is the loan in your name and your son co-signed the loan to induce the bank to loan you money to purchase the car, or is it the other way around, that your son borrowed the money and you co-signed the loan in order to induce the bank to loan your son the money? If the car title and the loan are in your name, are you defaulting on the loan and so your son is making the loan payments that should have come from you? Or is it that your son borrowed the money to buy the car, his name is on the title, he is making the payments, and you are no longer interested in backing him up in case he defaults and the bank comes after you for the money?\"", "title": "" }, { "docid": "5f2563cad205c94298096d00029a66ad", "text": "Depending on jurisdiction, the fact that you made some payments might give you an ownership share in the house in your own right. What share would be a complex question because you might need to consider both the mortgage payments made and maintenance. Your sister might also be able to argue that she was entitled to some recompense for the risk she describes of co-signing, and that's something that would be very hard to quantify, but clearly you would also be entitled to similar recompense in respect of that, as you also co-signed. For the share your mother owned, the normal rules of inheritance apply and by default that would be a 50-50 split as JoeTaxpayer said. You imply that the loan is still outstanding, so all of this only applies to the equity previously built up in the house prior to your mother's death. If you are the only one making the ongoing payments, I would expect any further equity built up to belong solely to you, but again the jurisdiction and the fact that your sister's name is on the deeds could affect this. If you can't resolve this amicably, you might need to get a court involved and it's possible that the cost of doing so would outweigh the eventual benefit to you.", "title": "" }, { "docid": "504089feb4bd30384b327605e231255a", "text": "First step is determine how much equity is in the car (positive or negative). Then for your car payments has that been paid out of money that has already been split or is it from a pool that is still to be slit. If the later, then it is irrelevant to this discussion since it was from a joint pool. If the money has already been split then adjust her half of the equity in the car by what you have been paying an make her that offer for her half of the car. I recommend showing her the calculations so as to explain how you came with what she is owed and then let her make a counter offer.", "title": "" }, { "docid": "b5f3ca0741c2e9d64b95e0f334d8629b", "text": "The answer depends on your wife's overall situation, whether you are in a community property state, and other factors. I'm assuming that since your wife paid $5,000 more for a car than it was worth, has a six-year, 25% auto loan and you talk about repossession as a routine event, that her credit history is extremely poor. If that is the case, you're unlikely to be able to refinance, particularly for more than the car is worth. You're in a bad situation, I'd look for a legal clinic at a nearby law school and find out what the law says about your situation in your state. If she has other debt, your best bet is to put the car in a garage somewhere, stop paying and demand better terms with the lender -- threaten bankruptcy. If they don't go for it, and your wife has other debt, she should look into bankruptcy. Given the usurious terms of the loan, you have a fighting chance of keeping the car in a Chapter 13. Find out and the legal implications for this before proceeding. If she doesn't have other debt, you need to figure out to get the thing repossessed on the best possible terms for you. If it's her mother's car, you're in a moral dilemma. Bottom line, get rid of this thing asap. And make sure that going forward you are both controlling the finances.", "title": "" }, { "docid": "5b7004ec040ee8fba64f99d4f90af7cf", "text": "\"Also the will stipulated that the house cannot be sold as long as one of my wife's aunts (not the same one who supposedly took the file cabinet) is alive. This is a turkey of a provision, particularly if she is not living in the house. It essentially renders the house, which is mortgaged, valueless. You'd have to put money into it to maintain the mortgage until she dies and you can sell it. The way that I see it, you have four options: Crack that provision in the will. You'd need to hire a lawyer for that. It may not be possible. Abandon the house. It's currently owned by the estate, so leave it in the estate. Distribute any goods and investments, but let the bank foreclose on the house. You don't get any value from the house, but you don't lose anything either. Your father's credit rating will take a posthumous hit that it can afford. You may need to talk to a lawyer here as well, but this is going to be a standard problem. Explore a reverse mortgage. They may be able to accommodate the weird provision with the aunt and manage the property while giving a payout. Or maybe not. It doesn't hurt to ask. Find a property manager in Philadelphia and have them rent out the house for you. Google gave some results on \"\"find property management company Philadelphia\"\" and you might be able to do better while in Philadelphia to get rid of his stuff. Again, I'd leave the house on the estate, as you are blocked from selling. A lawyer might need to put it in a trust or something to make that work (if the estate has to be closed in a certain time period). Pay the mortgage out of the rent. If there's extra left over, you can either pay down the mortgage faster or distribute it. Note that the rent may not support the mortgage. If not, then option four is not practical. However, in that case, the house is unlikely to be worth much net of the mortgage anyway. Let the bank have it (option two). If the aunt needs to move into the house, then you can give up the rental income. She can either pay the mortgage (possibly by renting rooms) or allow foreclosure. A reverse mortgage might also help in that situation. It's worth noting that three of the options involve a lawyer. Consulting one to help choose among the options might be constructive. You may be able to find a law firm with offices in both Florida and Pennsylvania. It's currently winter. Someone should check on the house to make sure that the heat is running and the pipes aren't freezing. If you can't do anything with it now, consider winterizing by turning off the water and draining the pipes. Turn the heat down to something reasonable and unplug the refrigerator (throw out the food first). Note that the kind of heat matters. You may need to buy oil or pay a gas bill in addition to electricity.\"", "title": "" }, { "docid": "a9ebe78161a536d7558dd48aea39b3d0", "text": "\"If you and your parents both put up money to buy a house or anything else, what share each of you owns would be a subject for negotiation and agreement between you. To the best of my knowledge, there is no law that says \"\"if person X pays the down payment and person Y pays the monthly payments, than X owns 40% and Y owns 60%\"\" or any other specific numbers. Parents often give their children money to help with a down payment on a house or a car with the understanding that this is a gift and the child still owns 100% of the item. Other times they are unwilling or unable to just give the money and want some stake in exchange. In the case of a house or a car, there's a title that identifies the owner, and legally the owner is the person or people named on the title. I'd suggest that if you want to have split ownership, like if your parents are saying that they'll help with the down payment but they want to get that money back when you sell or some such, that you come up with a written agreement saying who owns what percentage and you both sign it. If there was a dispute -- if you never had an agreement about what share each owned and now you're selling the house and you're arguing over how much of the money each of you should get, or your parents want you to sell the house so they can get their money back but you don't want to sell, or whatever -- ultimately a court would decide. Presumably the judge would consider how much you had each paid in, but he might also consider who's been paying property taxes, how much work each has done to maintain the place, etc. It's better to have a written and signed agreement, something that everyone involved is satisfied with and where you all know exactly what you're agreeing to, rather than having a nasty surprise when a judge says no, you're not getting what you were assuming you were getting.\"", "title": "" }, { "docid": "e4d718f0c2b682fc282de53f9ebdaef6", "text": "\"If the person has prepared (\"\"put your affairs in order\"\") then they will have a will and an executor. And this executor will have a list of the life insurance policies and will contact the companies to arrange payouts to the beneficiaries. It's not really the beneficiary's job to do that. If the person hasn't made a list of their policies, but has a will and an executor, then the executor can try things like looking at recently paid bills (you're sending $100 a month to \"\"Friendly Life Insurance Company\"\"? Bet it's a life insurance policy) or paperwork that is in the person's home or their safety deposit boxes. Even if you don't have the key to those boxes, a copy of the will and the death certificate will get the box drilled out for you. If you don't know what bank they might have SD boxes at, again your paperwork will get the manager to find out for you if there is a box at that particular branch, so a day spent visiting branches can be fruitful. (Something I know from personal experience with someone whose affairs were nowhere near in order.) Generally you find out you're a beneficiary of a will because the executor tells you. I suppose it's possible that a person might name you beneficiary of their life insurance without telling you or anyone else, and without writing a will, but it's pretty unlikely. If you're worried, I suggest you encourage your parents, grandparents, and other likely namers of you to write up some paperwork and keep it somewhere family is likely to find it. (Not hidden inside a book on a bookcase or in the back of the wool cupboard.)\"", "title": "" }, { "docid": "2ef47bc6e77a08529092f461b85d993b", "text": "\"The lead story here is you owe $12,000 on a car worth $6000!! That is an appalling situation and worth a lot to get out of it. ($6000, or a great deal more if the car is out of warranty and you are at risk of a major repair too.) I'm sorry if it feels like the payments you've made so far are wasted; often the numbers do work out like this, and you did get use of the car for that time period. Now comes an \"\"adversary\"\", who is threatening to snatch the car away from you. I have to imagine they are emotionally motivated. How convenient :) Let them take it. But it's important to fully understand their motivations here. Because financially speaking, the smart play is to manage the situation so they take the car. Preferably unbeknownst that the car is upside down. Whatever their motivation is, give them enough of a fight; keep them wrapped up in emotions while your eye is on the numbers. Let them win the battle; you win the war: make sure the legal details put you in the clear of it. Ideally, do this with consent with the grandfather \"\"in response to his direct family's wishes\"\", but keep up the theater of being really mad about it. Don't tell anyone for 7 years, until the statute of limitations has passed and you can't be sued for it. Eventually they'll figure out they took a $6000 loss taking the car from you, and want to talk with you about that. Stay with blind rage at how they took my car. If they try to explain what \"\"upside down\"\" is, feign ignorance and get even madder, say they're lying and they won, why don't they let it go? If they ask for money, say they're swindling. \"\"You forced me, I didn't have a choice\"\". (which happens to be a good defense. They wanted it so bad; they shoulda done their homework. Since they were coercive it's not your job to disclose, nor your job to even know.) If they want you to take the car back, say \"\"can't, you forced me to buy another and I have to make payments on that one now.\"\"\"", "title": "" } ]	fiqa
a5f84871eea29696bd712058aaa8b1d7	Is a car loan bad debt?	[ { "docid": "8ac5cffbd419a4f21a5789c2b9dc010d", "text": "Here is another way to look at it. Does this debt enable you to buy more car than you can really afford, or more car than you need? If so, it's bad debt. Let's say you don't have the price of a new car, but you can buy a used car with the cash you have. You will have to repair the car occasionally, but this is generally a lot less than the payments on a new car. The value of your time may make sitting around waiting while your car is repaired very expensive (if, like me, you can earn money in fine grained amounts anywhere between 0 and 80 hours a week, and you don't get paid when you're at the mechanic's) in which case it's possible to argue that buying the new car saves you money overall. Debt incurred to save money overall can be good: compare your interest payments to the money you save. If you're ahead, great - and the fun or joy or showoff potential of your new car is simply gravy. Now let's say you can afford a $10,000 car cash - there are new cars out there at this price - but you want a $30,000 car and you can afford the payments on it. If there was no such thing as borrowing you wouldn't be able to get the larger/flashier car, and some people suggest that this is bad debt because it is helping you to waste your money. You may be getting some benefit (such as being able to get to a job that's not served by public transit, or being able to buy a cheaper house that is further from your job, or saving time every day) from the first $10,000 of expense, but the remaining $20,000 is purely for fun or for showing off and shouldn't be spent. Certainly not by getting into debt. Well, that's a philosophical position, and it's one that may well lead to a secure retirement. Think about that and you may decide not to borrow and to buy the cheaper car. Finally, let's say the cash you have on hand is enough to pay for the car you want, and you're just trying to decide whether you should take their cheap loan or not. Generally, if you don't take the cheap loan you can push the price down. So before you decide that you can earn more interest elsewhere than you're paying here, make sure you're not paying $500 more for the car than you need to. Since your loan is from a bank rather than the car dealership, this may not apply. In addition to the money your cash could earn, consider also liquidity. If you need to repair something on your house, or deal with other emergency expenditures, and your money is all locked up in your car, you may have to borrow at a much higher rate (as much as 20% if you go to credit cards and can't get it paid off the same month) which will wipe out all this careful math about how you should just buy the car and not pay that 1.5% interest. More important than whether you borrow or not is not buying too much car. If the loan is letting you talk yourself into the more expensive car, I'd say it's a bad thing. Otherwise, it probably isn't.", "title": "" }, { "docid": "4d117fa1cc11e115832fee5e4fb4bbb1", "text": "\"Good debt and \"\"Bad debt\"\" are just judgement calls. Each person has their own opinion on when it is acceptable to borrow money for something, and when it is not. For some, it is never acceptable to borrow money for something; they won't even borrow money to buy a house. Others, of course, are in debt up to their eyeballs. All debt costs money in interest. So when evaluating whether to borrow or not, you need to ask yourself, \"\"Is the benefit I am getting by borrowing this money worth the cost?\"\" Home ownership has a lot of advantages: For many, these advantages, coupled with the facts that home mortgages are available at extremely low interest rates and that home mortgage interest is tax-deductible (in the U.S.), make home mortgages \"\"worth it\"\" in the eyes of many. Contrast that with car ownership: For these reasons, there are many people who consider the idea of borrowing money to purchase a car a bad idea. I have written an answer on another question which outlines a few reasons why it is better to pay cash for a car.\"", "title": "" }, { "docid": "17fa3df27d1ee72e8c155bbaccef568d", "text": "\"Just to argue the other side, 1.49% is pretty low for a loan. Let's say you have the $15k cash but decide to get the car loan at 1.49%. Then you take the rest of the money and invest it in something that pays a ~4% dividend (a utility stock, etc.). You're making money on the difference. Of course, there's no guarantee that the underlying stock won't drop in value, but it might go up, too. And you'll likely pay income tax on the dividends. Still, you have a good chance of making money by taking the loan. So I will argue that there are scenarios where taking advantage of a low interest rate loan can be \"\"good\"\" as an investment opportunity when the risk/reward is acceptable. Be careful, though. There's nothing wrong with paying cash for a car!\"", "title": "" }, { "docid": "b2a2594b75ac36caa7ddca5ccd0290ae", "text": "\"A car loan might be considered \"\"good\"\" debt, if the following circumstances apply: If, on the other hand, you only qualify for a subprime loan, or you're borrowing to buy a needlessly expensive car, that's probably not a good idea.\"", "title": "" }, { "docid": "4a21fbff9d86fc2fadf68b1669677794", "text": "What's missing in your question, so Kate couldn't address, is the rest of your financial picture. If you have a fully funded emergency account, are saving for retirement, and have saved up the $15K for the car, buy in cash. If you tell me that if the day after you buy the car in cash, your furnace/AC system dies, that you'd need to pay for it with an $8K charge to a credit card, that's another story. You see, there's more than one rate at play. You get close to zero on you savings today. You have a 1.5% loan rate available. But what is your marginal cost of borrowing? The next $10K, $20K? If it's 18% on a credit card, I personally would find value in borrowing at sub-2.5% and not depleting my savings. On the other side, the saving side, does your company offer a 401(k) with company match? I find too many people obsessing over their 6% debt, while ignoring a 100% match of 4-6% of their gross income. For what it's worth, trying to place labels on debt is a bit pointless. Any use of debt should be discussed 100% based on the finances of the borrower.", "title": "" }, { "docid": "14fbd60f61528b74f681f6033acfc003", "text": "The risk besides the extra interest is that you might be upside down on the loan. Because the car loses value the moment you drive off the lot, the slower you pay it off the longer it takes to get the loan balance below the resale value. Of course if you have a significant down payment, the risk of being upside down is not as great. Even buying a used car doesn't help because if you try to sell it back to the dealer the next week they wont give you the full price you paid. Some people try and split the difference, get the longer term loan, but then pay it off as quickly as the shorter term loan. Yes the interest rate is higher but if you need to drop the payment back to the required level you can do so.", "title": "" }, { "docid": "1d1b257f29aaef270074323d88d51d45", "text": "The good debt/bad debt paradigm only applies if you are considering this as a pure investment situation and not factoring in: A house is something you live in and a car is something you use for transportation. These are not substitutes for each other! While you can live in your car in a pinch, you can't take your house to the shops. Looking at the car, I will simplify it to 3 options: You can now make a list of pros and cons for each one and decide the value you place on each of them. E.g. public transport will add 5h travel time per week @ $X per hour (how much you value your leisure time), an expensive car will make me feel good and I value that at $Y. For each option, put all the benefits together - this is the value of that option to you. Then put all of the costs together - this is what the option costs you. Then make a decision on which is the best value for you. Once you have decided which option is best for you then you can consider how you will fund it.", "title": "" } ]	[ { "docid": "0f582e0ac48d6814598329f1322f4530", "text": "I'm going to be buying a house / car / home theater system in the next few months, and this loan would show up on my credit report and negatively impact my score, making me unable to get the financing that I'll need.", "title": "" }, { "docid": "51c97062f6e948df006f5fb2e8511fa4", "text": "\"Some very general advice. Lifestyle borrowing is almost always a bad idea. You should limit your borrowing to where it is an investment decision or where it is necessary and avoid it when it is a lifestyle choice. For example, many people need to borrow to have a car/house/education or go without. Also, if you are unemployed for a long period of time and can't find work, charging up the credit cards seems very reasonable. However, for things like entertainment, travel, and other nice-to-haves can easily become a road to crushing debt. If you don't have the cash for these types of things, my suggestion is to put off the purchase until you do. Note: I am not including credit cards that you pay off in full at the end of the month or credit used as a convenience as \"\"borrowing\"\"\"", "title": "" }, { "docid": "3aa6a4201058d4e0b109b5961a49f21a", "text": "Yes, a mortgage is debt. It's unique in that you have a house which should be worth far more than the mortgage. After the mortgage crisis, many found their homes under water i.e. worth less than the mortgage. The word debt is a simple noun for money owed, it carries no judgement or negative connotation except when it's used to buy short lived items with money one doesn't have. Aside from my mortgage, I get a monthly credit card bill which I pay in full. That's debt too, only it carried no interest and rewards me with 2% cash back. Many people would avoid this as it's still debt.", "title": "" }, { "docid": "f6bf0dac1b99db46ca516e83d40bd2b7", "text": "If I were you, I would pay off the car loan today. You already have an excellent credit score. Practically speaking, there is no difference between a 750 score and an 850 score; you are already eligible for the best loan rates. The fact that you are continuing to use 5 credit cards and that you still have a mortgage tells me that this car loan will have a negligible impact on your score (and your life). By the way, if you had told me that your score was low, I would still tell you to pay off the loan, but for a different reason. In that case, I would tell you to stop worrying about your score, and start getting your financial life in order by eliminating debt. Take care of your finances by reducing the amount of debt in your life, and the score will take care of itself. I realize that the financial industry stresses the importance of a high score, but they are also the ones that sell you the debt necessary to obtain the high score.", "title": "" }, { "docid": "adeb62f3873388115cae70ccf26f77c7", "text": "Used car dealers will sometimes deliberately issue high-interest-rate subprime loans to folks who have poor credit. But taking that kind of risk on a mortgage, when you aren't also taking profit out of the sale, really isn't of interest to anyone who cares about making a profit. There might be a nonprofit our there which does so, but I don't know of one. Fix your credit before trying to borrow.", "title": "" }, { "docid": "a464db56677e917c855023850fd8eae6", "text": "\"I guess I don't understand how you figure that taking out a car loan for $20k will result in adding $20k in equity. A car loan is a liability, not an asset like your $100k in cash. Besides, you don't get a dollar-for-dollar consideration when figuring a car's value against the loan it is encumbered by. In other words, the car is only worth what someone's willing to pay for it, not what your loan amount on it is. Remember that taking on a loan will increase your debt-to-income ratio, which is always a factor when trying to obtain a mortgage. At the same time, taking on new debt just prior to shopping for a mortgage could make it more difficult to find a lender. Every time a credit report (hard inquiry) is run on you, it temporarily impacts your credit score. The only exception to this rule is when it comes to mortgages. In the U.S., the way it works is that once you start shopping for a mortgage with lenders, for the next 30 days, additional inquiries into your credit report for purposes of mortgage funding do not count against your credit score, so it's a \"\"freebie\"\" in a way. You can't use this to shop for any other kind of credit, but the purpose is to allow you a chance to shop for the best mortgage rate you can get without adversely impacting your credit. In the end, my advice is to stop looking at how much house you can buy, and instead focus on a house with payments you can live with and afford. Trying to buy the most house based on what someone's willing to lend you leaves no room in the near-term for being able to borrow if the property has some repair needs, you want to furnish/upgrade it, or for any other unanticipated need which may arise that requires credit. Don't paint yourself into a corner. Just because you can borrow big doesn't mean you should borrow big. I hope this helps. Good luck!\"", "title": "" }, { "docid": "11692d59ac54be45ba7425bb06463446", "text": "The only reason to lend the money in this scenario is cashflow. But considering you buy a $15000 car, your lifestyle is not super luxurious, so $15000 spare cash is enough.", "title": "" }, { "docid": "0abf2d4619c289bdab3c1e7ba705521d", "text": "\"A repossessed automobile will have lost some value from sale price, but it's not valueless. They market \"\"title loans\"\" to people without good credit on this basis so its a reasonably well understood risk pool.\"", "title": "" }, { "docid": "1c0b26d263cfa5db63d98c2b6fdab3c0", "text": "Depending on the state this might not be possible. Loans are considered contracts, and various states regulate how minors may enter into them. For example, in the state of Oregon, a minor may NOT enter into a contract without their parent being on the contract as well. So you are forced to wait until you turn 18. At that time you won't have a credit history, and to lenders that often is worse than having bad credit. I can't help with the car (other than to recommend you buy a junker for $500-$1,000 and just live with it for now), but you could certainly get a secured credit card or line of credit from your local bank. The way they are arranged is, you make a deposit of an amount of your choosing (generally at least $200 for credit cards, and $1,000 for lines of credit), and receive a revolving line with a limit of that same amount. As you use and pay on this loan, it will be reported in your credit history. If you start that now, by the time you turn 18 you will have much better options for purchasing vehicles.", "title": "" }, { "docid": "9c266a77bcf1b5a8a1322854e2f6c5a9", "text": "I'm pessimistic about most things, so: They can't REPO the degree and the knowledge, but they can sure REPO the CAR, so pay off the car. My suggestion would be to pay off the vehicle, because no matter what the future holds (good or bad) you will need a vehicle to get around. Although, I recently found out from the comment below that student loans are a recourse debt that won't be forgiven. Not even with bankruptcy. Most collection agencies will take pennies in the dollar for debt, but not with student loans.", "title": "" }, { "docid": "93cfc7f27a3b137773cb171345b602eb", "text": "I doubt it. If you have a good track record with your car loan, that will count for a lot more than the fact that you don't have it anymore. When you look for a house, your debt load will be lower without the car loan, which may help you get the mortgage you want. Just keep paying your credit card bills on time and your credit rating will improve month by month.", "title": "" }, { "docid": "5b5a8ab3129653aeba03d641f4caf4ed", "text": "The article made it seem like a lot of these were frivolous purchases, but I doubt there's any clear data on the percent that were someone's primary vehicle, etc. Usually if you default on a new-car loan you can still get a high-interest loan for a used car that will still be a lot less than your old payment.", "title": "" }, { "docid": "693e8f4f219c393c142b1a7c0817c00d", "text": "The bottom line is you have an income problem. Your car payment seems very high relative to your income and your income is very low relative to your debt. Can you work extra jobs or start a small business to get that income up? In the US it would be fairly easy to work some part time jobs to get that income up about 1000 per month. With that kind of difference you could have this all knocked out (except for the car) in about a year. Then, six months later you could be done with your car. Most of the credit repair places are ripoffs in the US and I suspect it is similar around the world.", "title": "" }, { "docid": "29248fc376b5f475c8312f03cb2bada4", "text": "If you don't need to own a car for other reasons (i.e. if you are perfectly fine using Lyft and public transport), a new car loan should have just as much effect on your credit score as, say, opening a new credit card. Your credit score would take a temporary dip because of the hard inquiry to acquire the card, but your number of credit accounts would increase, and your credit utilization rate would go down, both of which are good things for your credit score. There may be better ways to increase your credit score that others know about, but I don't think getting a car loan when you don't need a car is the best one. Note, this assumes that you are paying all your credit cards off in full every month.", "title": "" }, { "docid": "3c3a3a2c410b0bc2b7d76f010a3fe0a2", "text": "$3,500 isn't usually enough to make a difference when calculating credit for a car loan. The other factors that you didn't mention are the important factors. How much money do you make? What is your credit score? Do you have balances on credit cards? The only way you can know is to look at your credit score and/or apply. I would generally recommend you buy a 3-4 year old car rather than a new car. With the lower purchase price you can pay it off quickly.", "title": "" } ]	fiqa
ba087c5f648f22e25e024b30562b3fe3	give free budgeting advice	[ { "docid": "e33025156ccff105618c180e01c176c4", "text": "They've asked you, so your advice is welcome. That's your main concern, really. I'd also ask them how much, and what kind of advice. Do they want you to point them to good websites? On what subjects? Or do they want more personal advice and have you to look over their bank accounts and credit card statements, provide accountability, etc.? Treat them the same way you'd want to be treated if you asked for help on something that you were weak on.", "title": "" }, { "docid": "a8a360a48db46630fb2e66038158a69f", "text": "The counsel of a friend doesn't come with a legal or professional liability. The key to doing this sort of thing successfully is to respect boundaries. You are providing advice and discussion, not taking over your friend's life.", "title": "" }, { "docid": "39fac01405b61176cd3e961c7a2eb120", "text": "\"Legally ok? Sure. Friends frequently discuss financial matters, and share advice. This is quite far from taking money from them and managing it, where at some point you need to be licensed for such things. If you're concerned about giving bad advice, just stay generic. The best advice has no risk. If I offer a friend a stock tip, of course there's the chance the stock goes south, but when I tell a friend who asks about the difference between Mutual Funds and ETFs, and we discuss the expenses each might have, I'm still leaving the decision as to which ETF to him. When I offer the 'fortune cookie' soundbites like \"\"If you are going to make a large purchase, delay it a week for each $100 of value. e.g. if you really want a $1000 TV, sleep on it for a few months\"\" no one can mis-apply this. I like those two sites you mentioned, but the one-on-one is good for the friend and for you. You can always learn more, and teaching helps you hone your skills.\"", "title": "" } ]	[ { "docid": "853f1ab64894dc0649111e6afc7bcd20", "text": "\"There is no free lunch. \"\"Free\"\" can cost you a small fortune over time. If you wish to sit through a free pitch you may as well go to a time share seminar. Just keep your hands in your pocket and don't sign anything. In the end, you will be best served spending the time it will take to learn to manage your own money. Short term, spend a few hundred dollars and find a fee only planner who will give you general advice. My disdain for the \"\"bank guy\"\" goes back to an overheard conversation. An older woman, in her 70s was asking about investing in T-bills vs the bank CD. T-bills were a bit higher yield at the time. The banker stated that the CD was FDIC insured,but T-bills were not. This was decades ago, but I remember it as if it were yesterday.\"", "title": "" }, { "docid": "8319b30fa80b9c804b0c17df20ff7559", "text": "I hate to sound harsh, but he's right. No technology, innovation, service or product can overcome your own lack of discipline. That doesn't mean you should give up, though - just like everything else, financial discipline is a learned skill, not something we're born with. Everyone can learn to be financially responsible. If you find you can't keep track of your expenses, try merely saving your receipts. Whenever you get home, pull them all out of your pockets, and look over how much you spent. Once you get to the point where you're consistently keeping your receipts, start keeping a register (either paper or electronic) that you update when you empty your pockets. From there, you can begin tracking how much you spend in various categories, and being setting budgets and adjusting your spending habits. It's not easy, but it's something that we all have gone through. Keep at it, and you can succeed in turning your finances around.", "title": "" }, { "docid": "16e3a08b056b997d41b9c57d6840c168", "text": "I am confused as to why the author thinks people wouldn't do this. If target wants to hand out free money they can be my guest. edit: Target, PM me if you're interested in this sort of arrangement.", "title": "" }, { "docid": "810435c5809639511389c5fc99eb133e", "text": "\"While Googling answers for a similar personal dilemma I found Mvelopes. I already have a budget but was looking for a digital way for my husband and I to track our purchases so we know when we've \"\"used the envelope\"\". It's a free app.\"", "title": "" }, { "docid": "c6fa632a4fe912a3d78b7a6592e82079", "text": "\"I wrote a little program one time to try to do this. I think I wrote it in Python or something. The idea was to have a list of \"\"projected expenses\"\" where each one would have things like the amount, the date of the next transaction, the frequency of the transaction, and so on. The program would then simulate time, determining when the next transaction would be, updating balances, and so on. You can actually do a very similar thing with a spreadsheet where you basically have a list of expenses that you manually paste in for each month in advance. Simply keep a running balance of each row, and make sure you don't forget any transactions that should be happening. This works great for fixed expenses, or expenses that you know how much they are going to be for the next month. If you don't know, you can estimate, for instance you can make an educated guess at how much your electric bill will be the next month (if you haven't gotten the bill yet) and you can estimate how much you will spend on fuel based on reviewing previous months and some idea of whether your usage will differ in the next month. For variable expenses I would always err on the side of a larger amount than I expected to spend. It isn't going to be possible to budget to the exact penny unless you lead a very simple life, but the extra you allocate is important to cushion unexpected and unavoidable overruns. Once you have this done for expenses against your bank account, you can see what your \"\"low water mark\"\" is for the month, or whatever time period you project out to. If this is above your minimum, then you can see how much you can safely allocate to, e.g. paying off debt. Throwing a credit card into the mix can make things a bit more predictable in the current month, especially for unpredictable amounts, but it is a bit more complicated as now you have a second account that you have to track that has to get deducted from your first account when it becomes due in the following month. I am assuming a typical card where you have something like a 25 day grace period to pay without interest along with up to 30 days after the expense before the grace period starts, depending on the relationship between your cut-off date and when the actual expense occurs.\"", "title": "" }, { "docid": "a3cb261d0561cda92eabd6e103677895", "text": "I use Banktivity. It's very much not free, but it automatically downloads all my bank and credit card activity and has excellent reporting options.", "title": "" }, { "docid": "9b8834fbccc5971800907f56b7c5afdd", "text": "Sure, Yahoo Finance does this for FREE.", "title": "" }, { "docid": "2fc79b65310eb6cba590a08089bf4016", "text": "Try the Envelope Budgeting System. It is a pretty good system for managing your discretionary outflows. Also, be sure to pay yourself first. That means treat savings like an expense (mortgage, utilities, etc.) not an account you put money in when you have some left over. The problem is you NEVER seem to have anything leftover because most people's lifestyle adjusts to fit their income. The best way to do this is have the money automatically drafted each month without any action required on your part. An employer sponsored 401K is a great way to do this.", "title": "" }, { "docid": "2da9c6cb77c6d43459a25ff16f45edfb", "text": "I'll chime in and say that my wife and I thought this was a really dumb idea, until we tried it. I was keeping track of everything in my checkbook ledger, but having the physical money in the envelopes really does work! We thought it would be more hassle than it's worth, and there were hiccups the first month or two, but in the end we both agree this is what started our movement towards responsible money management and debt reduction. We have the following Categories: Obviously, ymmv, but the point is to take any categories in your budget that are hard to budget for, as they vary from month to month, and just set aside an amount form your paycheck, in cash, for each one of those categories in an envelope. What I've noticed is that by putting the money aside up front, it's MUCH easier to stick to the budget. We'll often shuffle money around in the envelopes if priorities change for a particular month as well, so rather than taking money away from an extra payment on a debt or our planned savings transfer, which would have been our default action pre-envelopes, we can just move $XX from Date Night into Groceries if we have to, hence, planning out how we'll spend our money, budgeting, has gotten a LOT easier since adopting this system.", "title": "" }, { "docid": "a816d89279fc582023e15c450eb92628", "text": "\"There's plenty of advice out there about how to set up a budget or track your expenses or \"\"pay yourself first\"\". This is all great advice but sometimes the hardest part is just getting in the right frugal mindset. Here's a couple tricks on how I did it. Put yourself through a \"\"budget fire drill\"\" If you've never set a budget for yourself, you don't necessarily need to do that here... just live as though you had lost your job and savings through some imaginary catastrophe and live on the bare minimum for at least a month. Treat every dollar as though you only had a few left. Clip coupons, stop dining out, eat rice and beans, bike or car pool to work... whatever means possible to cut costs. If you're really into it, you can cancel your cable/Netflix/wine of the month bills and see how much you really miss them. This exercise will get you used to resisting impulse buys and train you to live through an actual financial disaster. There's also a bit of a game element here in that you can shoot for a \"\"high score\"\"... the difference between the monthly expenditures for your fire drill and the previous month. Understand the power of compound interest. Sit down with Excel and run some numbers for how your net worth will change long term if you saved more and paid down debt sooner. It will give you some realistic sense of the power of compound interest in terms that relate to your specific situation. Start simple... pick your top 10 recent non-essential purchases and calculate how much that would be worth if you had invested that money in the stock market earning 8% over the next thirty years. Then visualize your present self sneaking up to your future self and stealing that much money right out of your own wallet. When I did that, it really resonated with me and made me think about how every dollar I spent on something non-essential was a kick to the crotch of poor old future me.\"", "title": "" }, { "docid": "2f76a33c873603ac1284ac5b92b49c74", "text": "How complicated is your budget? We have a fairly in depth excel spreadsheet that does the trick for us. Lots of formulas and whatnot for calculating income, outgo, expected and actual expenses, expenses budgeted over time (i.e. planned expenses that are semi-annual or annual) as well as the necessary emergency funds based on expenses. Took me a few hours to initially create and many tweaks over months to get just right but it's reliable and we know we'll never lose support for it. I'd be willing to share it if desired, I'll just have to remove our personal finance figures from it first.", "title": "" }, { "docid": "2875ee4dbff21e3450c8336481610906", "text": "Try a tool like mint.com that will send you text messages regarding how you budget is going. If you use mint, set up your budget to send you reminders before you hit your budget. Example: if my budget for dining out is $100, I tell mint.com it is $50 and I get nagging text messages after $50 to remind me to keep a lid on my spending.", "title": "" }, { "docid": "1be62a1bbc7695255cb471e43e3333d2", "text": "\"Congratulations on earning a great income. However, you have a lot of debt and very high living expenses. This will eat all of your income if you don't get a hold of it now. I have a few recommendations for you. At the beginning of each month, write down your income, and write down all your expenses for the month. Include everything: rent, food, utilities, entertainment, transportation, loan payments, etc. After you've made this plan for the month, don't spend any money that's not in the plan. You are allowed to change the plan, but you can't spend more than your income. Budgeting software, such as YNAB, will make this easier. You are $51,000 in debt. That is a lot. A large portion of your monthly budget is loan payments. I recommend that you knock those out as fast as possible. The interest on these loans makes the debt continue to grow the longer you hold them, which means that if you take your time paying these off, you'll be spending much more than $51k on your debt. Minimize that number and get rid of them as fast as possible. Because you want to get rid of the debt emergency as fast as possible, you should reduce your spending as much as you can and pay as much as you can toward the debt. Pay off that furniture first (the interest rate on that \"\"free money\"\" is going to skyrocket the first time you are late with a payment), then attack the student loans. Stay home and cook your own meals as much as possible. You may want to consider moving someplace cheaper. The rent you are paying is not out of line with your income, but New York is a very expensive place to live in general. Moving might help you reduce your expenses. I hope you realize at this point that it was pretty silly of you to borrow $4k for a new bedroom set while you were $47k in debt. You referred to your low-interest loans as \"\"free money,\"\" but they really aren't. They all need to be paid back. Ask yourself: If you had forced yourself to save up $4k before buying the furniture, would you still have purchased the furniture, or would you have instead bought a used set on Craigslist for $200? This is the reason that furniture stores offer 0% interest loans. They got you to buy something that you couldn't afford. Don't take the bait again. You didn't mention credit cards, so I hope that means that you don't owe any money on credit cards. If you do, then you need to start thinking of that as debt, and add that to your debt emergency. If you do use a credit card, commit to only charging what you already have in the bank and paying off the card in full every month. YNAB can make this easier. $50/hr and $90k per year are fairly close to each other when you factor in vacation and holidays. That is not including other benefits, so any other benefits put the salaried position ahead. You said that you have a few more years on your parents' health coverage, but there is no need to wait until the last minute to get your own coverage. Health insurance is a huge benefit. Also, in general, I would say that salaried positions have better job security. (This is no guarantee, of course. Anyone can get laid off. But, as a contractor, they could tell you not to come in tomorrow, and you'd be done. Salaried employees are usually given notice, severance pay, etc.) if I were you, I would take the salaried position. Investing is important, but so is eliminating this debt emergency. If you take the salaried position, one of your new benefits will be a retirement program. You can take advantage of that, especially if the company is kicking in some money. (This actually is \"\"free money.\"\") But in my opinion, if you treat the debt as an emergency and commit to eliminating it as fast as possible, you should minimize your investing at this point, if it helps you get out of debt faster. After you get out of debt, investing should be one of your major goals. Now, while you are young and have few commitments, is the best time to learn to live on a budget and eliminate your debt. This will set you up for success in the future.\"", "title": "" }, { "docid": "16ee4513724d6b52193893884b7ffea9", "text": "Having been in exactly this position (not in a debt hole, built a budget to get a better view of what spending is), I can say what the greatest gift it brings is: it's a decision tool. When you are spending out of only one account, you often make decisions based on the total money in the account. “Should we go out for dinner? Can I make this impulse purchase?” This is terrible, because many, if not all, of those dollars are already intended for certain future expenses like groceries, bills, etc. You can't see how many of those dollars are discretionary. A budget is like having many accounts. Instead of looking at your real account(s) to make spending decisions, you look at your budget lines. You to want impulse buy a gadget — do you have money remaining in a relevant budget line? If yes, the decision is yours, if no, the budget is telling you that you don't have dollars for that.* Similarly for more prosaic purchases — you want to splurge on some non-staple groceries to make a fancy dinner or try out a new recipe, and the budget line for Groceries will tell you if you can do that. Instead of looking at (e.g.) $6000 in a chequing account, you're looking at $600 (assigned) − $146.86 (spend) = $453.14 (available) in a monthly groceries budget line. Just like you can now see where your money has been going, by maintaining and using your budget lines, and having every single dollar you spend go through the budget (to show your totally assigned, total spent, and total remaining), you can continue to see where your money is going in near real-time. You're no longer looking at bills and statements to figure out what's going on and plan, you're looking at money flows and future intentions, as you should be. This approach to budgeting has completely changed our finances. So that's what a budget is for: real-time spending decision-making control over your money, which for us has translated into a lovely mix of painless austerity in spending categories where austerity is smart, and guilt-free spending in more indulgent categories because we have already determined exactly how much we can afford and wish to spend. * A budget line with insufficient funds doesn't actually take the decision entirely away from you though. If a budget line doesn't have funds to spare for a given purchase, you can still make the purchase — but now you're also making the decision to go and revise your budget, taking dollars away from other budget lines to adjust the line you've overspent, to keep the budget accurate.", "title": "" }, { "docid": "195d6071acd6e2d8b387a469cc302541", "text": "Bought 2400 at .02. Getting half out if it gets to .24 Update: I saw it rising fast so I switched my limit from .24 to .30 and it reached exactly .30 this morning. Just dumb luck. Hanging onto the other shares. Will still come out on top even if it crashes.", "title": "" } ]	fiqa
f679a58b02bb7f58f9b19e6a6c6f6de4	moving family deposits away from Greece (possibly in UK)	[ { "docid": "a13a3d909a8a8d15a3b73e158a461de0", "text": "I can't comment about your tax liability in Greece. You will have to pay tax on interest in the UK. If you are earning massive amounts of interest, unlikely with the current interest policies from Merv, then you might be bumped up a tier. The receiving bank may ask for proof of the source of the funds, particularly if it is a fair chunk of change.", "title": "" }, { "docid": "9ee43db088ef43126ad6e5f9efd1aec9", "text": "\"I think you can do it as long as those money don't come from illegal activities (money laundering, etc). The only taxes you should pay are on the interest generated by those money while sitting in the UK bank account. Since I suppose you already paid taxes on those money in Greece while you were earning those money. About being audited, in my own experience banks don't ask you much where your money are coming from when you bring money to them, they are very willing to help, and happy. (It's a differnte story when you ask to borrow money). When I opened a bank account in US I did not even have an SSN, but they didn't care much they just took my passport and used the passport number for registering the account. Obviously on the interest generated by the money in the US bank account I had to pay taxes, but it was easy because I simply let the IRS via the bank to withdarw the 27% on the interest generated (not on the capital deposited). I didn't put a huge amount of money there I had to live there for 1 year or some more. Maybe if i deposited a huge amount of money someone would have come to ask me how did I make all those money, but those money were legally generated by me working in Italy before so I didn't have anything to be afraid about. BTW: in Italy I was thinking to move money to a German bank in Germany. The risk of default is a nightmare, something of completly new now in UE compared to the past where each state had its own currency. According to Muro history says that in case of default it happened that some government prevented people from withdrawing money form bank accounts: \"\"Yes, historically governments have shut down banks to prevent people from withdrawing their money in times of crisis. See Argentina circa 2001 or US during Great Depression. The government prevented people from withdrawing their money and people could do nothing while their money rapidly lost value.\"\" but in case Greece prevents people from withdrwaing money, those money are still in EURO, so i'm wondering what would be the effect. I mean would it be fair that a Greek guy can not withdraw is EURO money whilest an Italian guy can withdraw the same currency money in Italy?!\"", "title": "" } ]	[ { "docid": "22eb978738fd1c98a3ff89e48dc890fb", "text": "One way of looking at this (just expanding on my comment on Dheer's answer): If the funds were in EUR in Germany already and not in the UK, would you be choosing to move them to the UK (or a GBP denominated bank account) and engage in currency speculation, betting that the pound will improve? If you would... great, that's effectively exactly what you're doing: leave the money in GBP and hope the gamble pays off. But if you wouldn't do that, well you probably shouldn't be leaving the funds in GBP just because they originated there; bring them back to Germany and do whatever you'd do with them there.", "title": "" }, { "docid": "5717dc64a0a7d6b53568555d1bbece24", "text": "Citizens of India who are not residents to India (have NRI status) are not entitled to have ordinary savings accounts in India. If you have such accounts (e.g. left them behind to support your family while you are abroad), they need to be converted to NRO (NonResident Ordinary) accounts as soon as possible. Your bank will have forms for completion of this process. Any interest that these accounts earn will be taxable income to you in India, and possibly in the U.K. too, though tax treaties (or Double Taxation Avoidance Agreements) generally allow you to claim credit for taxes paid to other countries. Now, with regard to your question, NRIs are entitled to make deposits into NRO accounts as well as NRE (NonResident External) accounts. The differences are that money deposited into an NRE account, though converted to Indian Rupees, can be converted back very easily to foreign currency if need be. However, the re-conversion is at the exchange rate then in effect, and you may well lose that 10% interest earned because of a change in exchange rate. Devaluation of the Indian Rupee as occurred several times in the past 70 years. Once upon a time, it was essentially impossible to take money in an NRO account and convert it to foreign currency, but under the new recently introduced schemes, money in an NRO account can also be converted to foreign currencies, but it needs certification by a CA, and various forms to be filled out, and thus is more hassle. interest earned by the money in an NRE account is not taxable income in India, but is taxable income in the U.K. There is no taxable event (neither in U.K. nor in India) when you change an ordinary savings account held in India into an NRO account, or when you deposit money from abroad into an NRE or NRO account in an Indian bank. What is taxable is the interest that you receive from the Indian bank. In the case of an NRO account, what is deposited into your NRO account is the interest earned less the (Indian) income tax (usually 20%) deducted at the source (TDS) and sent to the Income Tax Authority on your behalf. In the case of an NRE account, the full amount of interest earned is deposited into the NRE account -- no TDS whatsoever. It is your responsibility to declare these amounts to the U.K. income tax authority (HM Revenue?) and pay any taxes due. Finally, you say that you recently moved to the U.K. for a job. If this is a temporary job and you might be back in India very soon, all the above might not be applicable to you since you would not be classified as an NRI at all.", "title": "" }, { "docid": "a84f16ada81922d72884f228646ce307", "text": "I spoke to HMRC and they said #1 is not allowable but #2 is. They suggested using either their published exchange rates or I could use another source. I suggested the Bank of England spot rates and that was deemed reasonable and allowable.", "title": "" }, { "docid": "3eb8a9c983ff88ae23bb3a03f78f8179", "text": "Greek bank deposits are backed by the Greek government and by the European Central Bank. So in order to lose money under the insurance limits of 100k euros the ECB would need to fail in which case deposit insurance would be the least of most peoples worries. On the other hand I have no idea how easy or hard it is to get to money from a failed bank in Greece. In the US FDIC insurance will usually have your money available in a couple of days. If there isn't a compelling reason to keep the money in a Greek bank I wouldn't do it.", "title": "" }, { "docid": "f2d5a66526ac8393e16c0a106c845b43", "text": "Have you tried TransferWise. They offer nice cross currency transfers with really low rates.", "title": "" }, { "docid": "88c461ef9c397b80086de1ac45b49a68", "text": "I'm not sure I understand what you're trying to say, but in general its pretty simple: She goes to the UK bank and requests a wire transfer, providing your details as a recipient. You then go to your bank, fill the necessary forms for the money-laundaring regulations, you probably also need to pay the taxes on the money to the IRS, and then you have it. If you have 1 million dollars (or is it pounds?), I'm sure you can afford spending several hundreds for a tax attorney to make sure your liabilities are reduced to minimum.", "title": "" }, { "docid": "371c1e838f63884778df632c1758dce0", "text": "Considering the historical political instability of your nation, real property may have higher risk than normal. In times of political strife, real estate plummets, precisely when the money's needed. At worst, the property may be seized by the next government. Also, keeping the money within the country is even more risky because bank accounts are normally looted by either the entering gov't or exiting one. The safest long run strategy with the most potential for your family is to get the money out into various stable nations with good history of protecting foreign investors such as Switzerland, the United States, and Hong Kong. Once out, the highest expected return can be expected from internationally diversified equities; however, it should be known that the value will be very variant year to year.", "title": "" }, { "docid": "93bd1971ca0c84f2a6edc1cea926be7d", "text": "Don't worry. The Cyprus situation could only occur because those banks were paying interest rates well above EU market rates, and the government did not tax them at all. Even the one-time 6.75% tax discussed is comparable to e.g. Germany and the Netherlands, if you average over the last 5 years. The simple solution is to just spread your money over multiple banks, with assets at each bank staying below EUR 100.000. There are more than 100 banks large enough that they'll come under ECB supervision this year; you'd be able to squirrel away over 10 million there. (Each branch of the Dutch Rabobank is insured individually, so you could even save 14 million there alone, and they're collectively AAA-rated.) Additionally, those savings will then be backed by more than 10 governments, many of which are still AAA-rated. Once you have to worry about those limits, you should really talk to an independent advisor. Investing in AAA government bonds is also pretty safe. The examples given by littleadv all involve known risky bonds. E.g. Argentina was on a credit watch, and paying 16% interest rates.", "title": "" }, { "docid": "c22ddc6666d604975f4b2b01bdbd3979", "text": "Given that we live in a world rife with geopolitical risks such as Brexit and potential EU breakup, would you say it's advisable to keep some of cash savings in a foreign currency? Probably not. Primarily because you don't know what will happen in the fallout of these sorts of political shifts. You don't know what will happen to banking treaties between the various countries involved. If you can manage to place funds on deposit in a foreign bank/country in a currency other than your home currency and maintain the deposit insurance in that country and not spend too much exchanging your currency then there probably isn't a downside other than liquidity loss. If you're thinking I'll just wire some whatever currency to some bank in some foreign country in which you have no residency or citizenship consideration without considering deposit insurance just so you might protect some of your money from a possible future event I think you should stay away.", "title": "" }, { "docid": "9fd148c6144907a4ce883f384e211046", "text": "But Greece is in the EU - therefore the one-armed drug addict has the means to get money from his relatives. Because most of the relatives have an alcohol problem (Spain, Portugal, Italy, France) they turn to their hard-working but slightly naive neighbours (Austria,Germany,Netherlands) for money. They believe that they´ll have to pay for just one last dose of crack cocaine and then the Greeks will kick the habit.", "title": "" }, { "docid": "273ef3ca22682b8150cbe34e9946a2fb", "text": "The safest financial decisions that you can make in Greece involve getting your money out of Greece. That said, it depends. If the economy is going to implode and you'll be out of the job with devalued savings -- you'll be bankrupt anyway. You didn't mention enough about your situation for anyone to really answer the question. In a high-inflation environment, ifyou have the assets to weather the storm, holding debt on real property and durable goods is a good thing. The key considerations are: If you have the means, times of crisis are great opportunities.", "title": "" }, { "docid": "4fe71042dfbec2d2fe3574a3963d9112", "text": "I would move some or all of the money. With £30K savings, you have a 20% deposit, whereas you can get a much better mortgage rate with a 40 or 50% deposit. That's true no matter how good/bad your credit rating, and it's possible that with a bad credit rating you may not even be able to get a mortgage with a small deposit. Also, you will almost certainly save significantly more by paying less mortgage interest compared to the interest rates on your savings in the Netherlands. Shop around for a cheap option to transfer money. I had a quick look at Transferwise (no affiliation, they just happen to have a convenient calculator on their website), and the all-in cost for a large one-way transfer seems to be about 0.5%. I think you'll more than make that back in terms of savings on your mortgage. If you intend to move back to the Netherlands at some point, then you are taking some exchange rate risk by moving your savings to the UK - you don't know if it'll be better or worse when you want to transfer money back. But I guess it won't be that soon if you want to buy a house, so I think the risk is probably worthwhile. (I calculated the cost of the transfer by converting €100k into GBP, and then converting the resulting amount back again. That left €99k, so a two-way transfer cost 1% and from that I deduced that a one-way transfer costs roughly 0.5%)", "title": "" }, { "docid": "a316b4e61c79499efab27a0de2c74573", "text": "I am going to clone an answer from another question that I wrote ;) and refer you to an article in the Wall Street Journal that I read this morning, What's at Stake in the Greek Vote, summarizing the likely outcome of the situation if a Euro exit looks likely after the election: ... we will see a full-fledged bank run. Greek banks would collapse ... The market exchange-rate would likely be two or three drachmas to the euro, which would double or triple the Greek price of imported goods within a few days. Prices of assets, including real-estate assets, would crumble. Those who moved their deposits abroad would be able to buy these assets cheaply, leading to a significant, regressive redistribution of Greek wealth. In short, you'd lose about two-thirds of your savings unless you were storing them somewhere safe from the conversion. The article also predicts difficulty importing goods (other nations will demand to be paid in euro, not drachma) leading to disruption of trade and various supply shortages.", "title": "" }, { "docid": "47a26543206f7468bb70e67639da2474", "text": "No you will have no problems. It's been fourteen years since I've lived in the UK and I've had no trouble with my UK bank accounts in that time. They have happily mailed me statements and new cards abroad for all that time, and I've deposited cheques by mailing them to the branch. Online banking takes care of almost everything else. The only thing I wasn't able to do from abroad was open a new account, because of anti money-laundering regulations. Even that may be possible if you presented the right kind of ID when you opened the original account - mine predated the regulations. Most UK banks will also offer 'offshore' banking for non-residents in which interest is not deducted at source.", "title": "" }, { "docid": "a409e9ac055ad2bcb8612e19efcef9a2", "text": "It sounds like you are in great shape, congratulations! Things I would think about in your position: Consider putting 20% down instead of 30% and find a great house that has a key missing modernization, like a kitchen. Then replace the kitchen, which if done right can instantly add that 10% (or more) right back in equity... or stick to your plan... You have earned the luxury of taking your time and doing what's right for you. Think real carefully about location. Here are some ideas based on my experience.", "title": "" } ]	fiqa
a2760e30436195f51cc0a4a341772ba5	Are there good investment options to pay off student loans?	[ { "docid": "87c67815a720af85f70f07a3783f1f6d", "text": "Paying off your student loan is an investment, and a completely risk-free one. Every payment of your loan is a purchase of debt at the interest rate of the loan. It would be extremely unusual to be able to find a CD, bond or other low-risk play at a better rate. Any investment in a risky asset such as stocks is just leveraging up your personal balance sheet, which is strictly a personal decision based on your risk appetite, but would nearly universally be regarded as a mistake by a financial advisor. (The only exception I can think of here would be taking out a home mortgage, and even that would be debatable.) Unless your loan interest rate is in the range of corporate or government bonds -- and I'm sure it isn't -- don't think twice about paying them off with any free cash you have.", "title": "" }, { "docid": "eced5a5b1949a6d5aa8cb7ff9a8b1692", "text": "What you're getting at is the same as investing with leverage. Usually this comes in the form in a margin account, which an investor uses to borrow money at a low interest rate, invest the money, and (hopefully!) beat the interest rate. is this approach unwise? That completely depends on how your investments perform and how high your loan's interest rate is. The higher your loan's interest rate, the more risky your investments will have to be in order to beat the interest rate. If you can get a return which beats the interest rates of your loan then congratulations! You have come out ahead and made a profit. If you can keep it up you should make the minimum payment on your loan to maximize the amount of capital you can invest. If not, then it would be better to just use your extra cash to pay down the loan. [are] there really are investments (aside from stocks and such) that I can try to use to my advantage? With interest rates as low as they are right now (at least in the US) you'll probably be hard-pressed to find a savings account or CD that will return a higher interest rate than your loan's. If you're nervous about the risk associated with investing in stocks and bonds (as is healthy!), then know that they come in a wide spectrum of risk. It's up to you to evaluate how much risk you're willing to take on to achieve a higher return.", "title": "" } ]	[ { "docid": "f85e13b9c2caab8271e436ba28db873d", "text": "Is there anything here I should be deathly concerned about? A concern I see is the variable rate loans. Do you understand the maximum rate they can get to? At this time those rates are low, but if you are going to put funds against the highest rate loan, make sure the order doesn't change without you noticing it. What is a good mode of attack here? The best mode of attack is to pay off the one with the highest rate first by paying more than the minimum. When that is done roll over the money you were paying for that loan to the next highest. Note if a loan balance get to be very low, you can put extra funds against this low balance loan to be done with it. Investigate loan forgiveness programs. The federal government has loan forgiveness programs for certain job positions, if you work for them for a number of years. Some employers also have these programs. What are the payoff dates for the other loans? My inexact calculations put a bunch in about 2020 but some as late as 2030. You may need to talk to your lender. They might have a calculator on their website. Why do my Citi loans have a higher balance than the original payoff amounts? Some loans are subsidized by the federal government. This covers the interest while the student is still in school. Non-subsidized federal loans and private loans don't have this feature, so their balance can grow while the student is in school.", "title": "" }, { "docid": "368672e7a90b4f3650ca078c1c229c9e", "text": "For the sake of sanity, pay off your debt maybe not all but some part of it. You never know what the monster, the stock market may turn out to be. It may gobble up all your money without belching or it may gift you with a bounty. But if you pay off all your debt and the stock market monster is rewarding everybody else, you may rue your decision. So put some part of it the markets too, but a more safer one would be a good bet. The proportions of money for loan repayment and for investing in markets is your decision, after you evaluate all your future predictions.", "title": "" }, { "docid": "a49a54204023c175881cedcd8f91556f", "text": "What is my best bet with the 401K? I know very little about retirement plans and don't plan to ever touch this money until I retire but could this money be of better use somewhere else? You can roll over a 401k into an IRA. This lets you invest in other funds and stocks that were not available with your 401k plan. Fidelity and Vanguard are 2 huge companies that offer a number of investment opportunities. When I left an employer that had the 401k plan with Fidelity, I was able to rollover the investments and leave them in the existing mutual funds (several of the funds have been closed to new investors for years). Usually, when leaving an employer, I have the funds transferred directly to the place my IRA is at - this avoids tax penalties and potential pitfalls. The student loans.... pay them off in one shot? If the interest is higher than you could earn in a savings account, then it is smarter to pay them off at once. My student loans are 1.8%, so I can earn more money in my mutual funds. I'm suspicious and think something hinky is going to happen with the fiscal cliff negotiations, so I'm going to be paying off my student loans in early 2013. Disclaimer: I have IRA accounts with both Fidelity and Vanguard. My current 401k plan is with Vanguard.", "title": "" }, { "docid": "2df91218cdd7577567e93eb9bf227e59", "text": "Obviously, you should not buy stock when the option is to pay down your debt. However, your question is different. Should you sell to reduce debt. That really depends on your personal situation. If you were planning to sell the stock anyway, go ahead and reduce your loans. Check out how the stock is doing and what the perspectives are. If the stock looks like it's going down, sell... Do you have savings? Unless you do, I should advise to sell the stock at any rate. If you do have savings, are they earning you more (in percentage) than your loans? If they are, keep them...", "title": "" }, { "docid": "7f40db430f8f8ee4666972af247ef285", "text": "\"they said the expected returns from the stock market are around 7-9%(ish). (emphasis added) The key word in your quote is expected. On average \"\"the market\"\" gains in the 7-9% range (more if you reinvest dividends), but there's a great deal of risk too, meaning that in any given year the market could be down 20% or be up 30%. Your student loan, on the other hand, is risk free. You are guaranteed to pay (lose) 4% a year in interest. You can't directly compare the expected return of a risk-free asset with the expected return of a risky asset. You can compare the risks of two assets with equal expected returns, and the expected returns of assets with equal risks, but you can't directly compare returns of assets with different risks. So in two years, you might be better off if you had invested the money versus paying the loan, or you might be much worse off. In ten years, your chances of coming out ahead are better, but still not guaranteed. What's confusing is I've heard that if you're investing, you should be investing in both stocks and bonds (since I'm young I wouldn't want to put much in bonds, though). So how would that factor in? Bonds have lower risk (uncertainty) than stocks, but lower expected returns. If you invest in both, your overall risk is lower, since sometimes (not always) the gain in stocks are offset by losses in bonds). So there is value in diversifying, since you can get better expected returns from a diversified portfolio than from a single asset with a comparable amount of risk. However, there it no risk-free asset that will have a better return than what you're paying in student loan interest.\"", "title": "" }, { "docid": "4cfcba5b1e6747901d30d44efc2ff52f", "text": "As weird as it seems, 5 years is not a long term investment. Furthermore investing is about accepting risk. Based on your criteria for the alternative to a down payment, I think your only choice is to make the larger down payment. If however, you were willing to invest that money for the long term (in a retirement account or an educational account for example) then I would definitely encourage you to invest. I think the chance that a long term investment in a diversified investment account will exceed 3.25% is pretty high. However, that is only my opinion, and I am not clairvoyant, so your let your personal tolerance to risk be your guide. But again, based on the way you asked it, down payment all the way. Your time frame means you are not an investor. Therefore your only option for risk free storage of money is an FDIC insured account, which might pay a little less than 1% for the next 5 years. A bigger down payment will have a 3.25% return in this case. In that order. #4 and #5 could be swapped if the interest rate on the loans is really low.", "title": "" }, { "docid": "10a507f344ac4ddd357f62b4226c4b24", "text": "Just for another opinion, radio host Clark Howard would suggest killing the private student loans as quickly as possible. The only reason is the industry around private student loans has fewer rules as to how they interact with you, and they have historically been very unpleasant if you have to deal with them in bad financial times. As a safety net, get rid of the private student loans as your main focus while you have the money and rates are low. Not for financial reasons per se, but for peace of mind. The other advice in this question are great, but nobody mentioned the potential dark side of private student loans.", "title": "" }, { "docid": "7e13b75dc06a5eede38b2cc9dc8ea597", "text": "\"Mathematically, the wisest choice is to invest your extra money somewhere else and not pay off your 0% loan early. An extreme example highlights this. Suppose some colossal company offered to loan you a billion dollars at 0 % interest. Would you take it? Or would you say \"\"No thanks, I don't want that much debt.\"\" You would be crazy not to accept. You could put that money in the safest investments available and still pocket millions while making the minimum payments back to them. Your choice here is essentially the same, but unfortunately, on much smaller scale. That said, math doesn't always trump other factors. You need to factor in your peace of mind, future purchases, the need for future borrowing, your short term income and job security, and whether you think you can reliably make payments on this loan without messing up and triggering fees that wipe out the mathematical advantage of slow paying the loan. You are fortunate because you really can't make a wrong choice here. Paying off debt is never a bad choice IMO. However, it may not always be the best choice.\"", "title": "" }, { "docid": "9182607a4ada87e464e537e88a5480b0", "text": "Forgive me as I do not know much about your fine country, but I do know one thing. You can make 5% risk free guaranteed. How, from your link: If you make a voluntary repayment of $500 or more, you will receive a bonus of 5 per cent. This means your account will be credited with an additional 5 per cent of the value of your payment. I'd take 20.900 of that amount saved and pay off her loan tomorrow and increase my net worth by 22.000. I'd also do the same thing for your loan. In fact in someways it is more important to pay off your loan first. As I understand it, you will eventually have to pay your loan back once your income rises above a threshold. Psychologically you make attempt to retard your future income in order to avoid payback. Those decisions may not be made overtly but it is likely they will be made. So by the end of the day (or as soon as possible), I'd have a bank balance of 113,900 and no student loan debt. This amounts to a net increase in net worth of 1900. It is a great, safe, first investment.", "title": "" }, { "docid": "ef33069fb68f76ccd86278fb8354543c", "text": "\"The rate difference between your student loans and the historical yearly average growth in the S&P500 isn't large enough for me to play the \"\"pay minimums and invest the rest\"\" strategy. If your loans were 2%, I might think about it. However, the 4% loans are guaranteed and mandatory expenses; discharging them even in bankruptcy is unlikely. The quicker you pay them off, the sooner you won't have them hanging over your head in case of a \"\"financial setback\"\" (job loss, large expense uncovered by insurance, etc). (One good reason to pay the minimums, though, is to build up a $1K emergency fund. When your debts are paid, then you can increase its size.)\"", "title": "" }, { "docid": "1767804e4818a27da97de8602bf19757", "text": "\"I agree with @Pete that you may be well-advised to pay off your loans first and go from there. Even though you may not be \"\"required\"\" to make payments on your own loan based on your income, that debt will play a large factor in your borrowing ability until it is gone, which hinders your ability to move toward home ownership. If you are in a fortunate enough position to totally pay off both your loan and hers from cash on hand then you should. It would still leave you with more than $112,000 and no debt, which is a big priority and advantage for a young couple. Mind you, this doesn't keep you from starting an investment plan with some portion of the remaining funds (the advice to keep six months' income in the bank is very wise) through perhaps a mutual fund if you don't want to directly manage the investments yourself. The advantage of mutual funds is the ability to choose the level of risk you're willing to take and let professionals manage how to achieve your goals for you. You can always make adjustments to your funds as your circumstances change. Again, I'd emphasize ridding yourself of the student loan debt as the first move, then looking at how to invest the remainder.\"", "title": "" }, { "docid": "934d84cd728be42ec4f3f01466e993c3", "text": "Please direct personal finance questions to /r/personalfinance However, my opinion is that you are unlikely to earn more than 7% annualized returns from any combination of asset offerings in your 401k over the next several years; therefore, you should pay off your student loans first. I am ignoring tax consequences, but /r/personalfinance may be able to provide a more quantitative answer.", "title": "" }, { "docid": "67c31d2f35d612cbf8002be1e740d5fd", "text": "while not stated, if you have any debt at all, use the $3000 to pay it off. That's the best investment in the short term. No risk and guaranteed reward. College can invite all sorts of unexpected expenses and opportunities, so stay liquid, protect working capital.", "title": "" }, { "docid": "3d34c21a2d3c48e716c0f7c03fbe1e8d", "text": "\"There are several ways you can get out of paying your student loans back in the USA: You become disabled and the loan is dismissed once verified by treating doctor or the Social Security Administration. You become a peace officer. You become a teacher; generally K-12, but I have heard from the DOE that teachers at state schools qualify as well. So the \"\"malicious\"\" friend B is prescribing to the theory that if one of those conditions becomes true, friend A will not have to pay back the loan. The longer you drag it out, the more chance you have to fulfill a condition. Given that 2 of these methods require a commitment, my guess is that they are thinking more along the lines of the first one, which is horrible. Financially, it makes no sense to delay paying back your loans because deferred loans are only interest-free until you graduate and are past your grace period, after which they will begin accruing interest. Unsubsidized loans accrue interest from the day you get them, only their payback is deferred until you graduate and exhaust your grace period. Anytime you ask for forbearance, you are still accruing interest and it is capitalizing into your principal — you are just given a chance to delay payback due to financial hardship, bad health, or loss of job. Therefore, at no point are you benefiting beyond the time you are in school and getting an education, still looking for a job, or dealing with health issues. In the current market, no CD, no savings account, and no investment will give you substantially more return that will offset the loss of the interest you are accruing. Even those of us in the old days getting 4.X % rates would not do this. There was a conditional consolidation offer the DOE allowed which could bring all your loans under one roof for a competitive 5.x-6.x % rate allowing you a single payment, but even then you would benefit if you had rates that were substantially higher. From a credit worthiness aspect, you are hurt by the outstanding obligation and any default along the way, so you really want to avoid that — paying off or down your loans are a good way to ensure you don't shoot yourself in the foot.\"", "title": "" }, { "docid": "1c93766cffbed678cdc07a21a5894f72", "text": "Something you may want to consider if you are still choosing a bill-paying service is the contingency policies of the service. I just suffered an extended stay in a hospital and my officially (in writing) designated Power of Attorney was NOT granted access to my PAYTRUST account. Thus they could NOT take care of my finances easily. After my discharge, I contacted PAYTRUST and they had canceled my account and would not reactivate it. This is after over fifteen years of loyalty. Needless to say there was much financial chaos in my life due to their negligence. They were staunch in their policy and said officially that if they need to acknowledge a Power of Attorney, the ONLY thing they will allow the POA to do is close the PAYTRUST account. How's that for customer service?! Caveat Emptor. I am now seeking another service and will be asking about their POA policies.", "title": "" } ]	fiqa
66facda2050a4b85c21a2681fe5f4564	Credit card transactions for personal finances	[ { "docid": "4eb21a693fbd8bfccffd42ad8ca2d72a", "text": "I use mint.com for tracking my finances. It works on mobile phones, tablets, and in a browser. If you don't mind the initial hassle of putting in the credentials you use to access your account online, you'll find that you're able to build a comprehensive picture of the state of your finances relatively quickly. It does a great job of separating the various types of financial transactions you engage in, and also lets you customize those classifications with tags. It's ad-supported, so there's no out-of-pocket cost to you, and it doesn't preclude you from using the personal finance software you already have on your phone.", "title": "" }, { "docid": "b5ac2c4ff3c5d1c545838bec51ac3bb8", "text": "\"Other responses have focused on getting you software to use, but I'd like to attempt your literal question: how are such transactions managed in systems that handle them? I will answer for \"\"double entry\"\" bookkeeping software such as Quicken or GnuCash (my choice). (Disclaimer: I Am Not An Accountant and accountants will probably find error in my terminology.) Your credit card is a liability to you, and is tracked using a liability account (as opposed to an asset account, such as your bank accounts or cash in your pocket). A liability account is just like an asset except that it is subtracted from rather than added to your total assets (or, from another perspective, its balance is normally negative; the mathematics works out identically). When you make a purchase using your credit card, the transaction you record transfers money from the liability account (increasing the liability) to the expense account for your classification of the expense. When you make a payment on your credit card, the transaction you record transfers money from your checking account (for example) to the credit card account, reducing the liability. Whatever software you choose for tracking your money, I strongly recommend choosing something that is sufficiently powerful to handle representing this as I have described (transfers between accounts as the normal mode of operation, not simply lone increases/decreases of asset accounts).\"", "title": "" } ]	[ { "docid": "b454bdd66734e04e3cd3b92bb4779f8f", "text": "I'm an Australian who just got back from a trip to Malaysia for two weeks over the New Year, so this feels a bit like dejavu! I set up a 28 Degrees credit card (my first ever!) because of their low exchange rate and lack of fees on credit card transactions. People say it's the best card for travel and I was ready for it. However, since Malaysia is largely a cash economy (especially in the non-city areas), I found myself mostly just withdrawing money from my credit card and thus getting hit with a cash advance fee ($4) and instant application of the high interest rate (22%) on the money. Since I was there already and had no other alternatives, I made five withdrawals over the two weeks and ended up paying about $21 in fees. Not great! But last time I travelled I had a Commonwealth Bank Travel Money Card (not a great idea), and if I'd used that instead on this trip and given up fees for a higher exchange rate, I would have been charged an extra $60! Presumably my Commonwealth debit card would have been the same. This isn't even including mandatory ATM fees. If I've learned anything from this experience and these envelope calculations I'm doing now, it's these:", "title": "" }, { "docid": "82ff187f4225026f40610da4f9d69f54", "text": "\"There's no difference between \"\"individual\"\" and \"\"business\"\" in this context. What is a personal transaction that involves credit card? You have a garage sale? Its business. You sell something on craigslist - business. Want to let people pay for your daughter's girlscout cookies - business. There's no difference between using Paypal (which has its own credit card reader, by the way) and Square in this context. No-one will ask for any business licenses or anything, just your tax id (be it SSN or EIN). Its exactly the same as selling on eBay and accepting credit cards through your Paypal account, conceptually (charge-back rules are different, because Square is a proper merchant account, but that's it).\"", "title": "" }, { "docid": "0ff87b4504eaa0cf33d2b696582f47ef", "text": "\"I think the \"\"right\"\" way to approach this is for your personal books and your business's books to be completely separate. You would need to really think of them as separate things, such that rather than being disappointed that there's no \"\"cross transactions\"\" between files, you think of it as \"\"In my personal account I invested in a new business like any other investment\"\" with a transfer from your personal account to a Stock or other investment account in your company, and \"\"This business received some additional capital\"\" which one handles with a transfer (probably from Equity) to its checking account or the like. Yes, you don't get the built-in checks that you entered the same dollar amount in each, but (1) you need to reconcile your books against reality anyway occasionally, so errors should get caught, and (2) the transactions really are separate things from each entity's perspective. The main way to \"\"hack it\"\" would be to have separate top-level placeholder accounts for the business's Equity, Income, Expenses, and Assets/Liabilities. That is, your top-level accounts would be \"\"Personal Equity\"\", \"\"Business Equity\"\", \"\"Personal Income\"\", \"\"Business Income\"\", and so on. You can combine Assets and Liabilities within a single top-level account if you want, which may help you with that \"\"outlook of my business value\"\" you're looking for. (In fact, in my personal books, I have in the \"\"Current Assets\"\" account both normal things like my Checking account, but also my credit cards, because once I spend the money on my credit card I want to think of the money as being gone, since it is. Obviously this isn't \"\"standard accounting\"\" in any way, but it works well for what I use it for.) You could also just have within each \"\"normal\"\" top-level placeholder account, a placeholder account for both \"\"Personal\"\" and \"\"My Business\"\", to at least have a consistent structure. Depending on how your business is getting taxed in your jurisdiction, this may even be closer to how your taxing authorities treat things (if, for instance, the business income all goes on your personal tax return, but on a separate form). Regardless of how you set up the accounts, you can then create reports and filter them to include just that set of business accounts. I can see how just looking at the account list and transaction registers can be useful for many things, but the reporting does let you look at everything you need and handles much better when you want to look through a filter to just part of your financial picture. Once you set up the reporting (and you can report on lists of account balances, as well as transaction lists, and lots of other things), you can save them as Custom Reports, and then open them up whenever you want. You can even just leave a report tab (or several) open, and switch to it (refreshing it if needed) just like you might switch to the main Account List tab. I suspect once you got it set up and tried it for a while you'd find it quite satisfactory.\"", "title": "" }, { "docid": "46bc1213fb52a6c9ecdc1047f6d59daa", "text": "For double entry bookkeeping, personal or small business, GnuCash is very good. Exists for Mac Os.", "title": "" }, { "docid": "a89bd74e7a3d5b571288ebb11b2dacc4", "text": "\"I completely agree with @littleadv in favor of using the credit card and dispute resolution process, but I believe there are more important details here related to consumer protection. Since 1968, US citizens are protected from credit card fraud, limiting the out-of-pocket loss to $50 if your card is lost, stolen, or otherwise used without your permission. That means the bank can't make you pay more than $50 if you report unauthorized activity--and, nicely, many credit cards these days go ahead and waive the $50 too, so you might not have to pay anything (other than the necessary time and phone calls). Of course, many banks offer a $50 cap or no fees at all for fraudulent charges--my bank once happily resolved some bad charges for me at no loss to me--but banks are under no obligation to shield debit card customers from fraud. If you read the fine print on your debit card account agreement you may find some vague promises to resolve your dispute, but probably nothing saying you cannot be held liable (the bank is not going to lose money on you if they are unable to reverse the charges!). Now a personal story: I once had my credit card used to buy $3,000 in stereo equipment, at a store I had never heard of in a state I have never visited. The bank notified me of the surprising charges, and I was immediately able to begin the fraud report--but it took months of calls before the case was accepted and the charges reversed. So, yes, there was no money out of my pocket, but I was completely unable to use the credit card, and every month they kept on piling on more finance fees and late-payment charges and such, and I would have to call them again and explain again that the charges were disputed... Finally, after about 8 months in total, they accepted the fraud report and reversed all the charges. Lastly, I want to mention one more important tool for preventing or limiting loss from online purchases: \"\"disposable\"\", one-time-use credit card numbers. At least a few credit card providers (Citibank, Bank of America, Discover) offer you the option, on their websites, to generate a credit card number that charges your account, but under the limits you specify, including a maximum amount and expiration date. With one of these disposable numbers, you can pay for a single purchase and be confident that, even if the number were stolen in-transit or the merchant a fraud, they don't have your actual credit card number, and they can never charge you again. I have not yet seen this option for debit card customers, but there must be some banks that offer it, since it saves them a lot of time and trouble in pursuing defrauders. So, in short: If you pay with a credit card number you will not ever have to pay more than $50 for fraudulent charges. Even better, you may be able to use a disposable/one-time-use credit card number to further limit the chances that your credit is misused. Here's to happy--and safe--consumering!\"", "title": "" }, { "docid": "9c94d24ea670df4c1baf45394ac352fa", "text": "some of that article is misleading, some of it is just plain wrong. Very wrong... like you end up drawing an incorrect conclusion type wrong. Corporate transaction accounts, whose balances are up recently due to TAG (expires 12/31), are subject to reserve requirements. When you purchase something with a credit card, the bank's asset of your credit increases and the bank's asset of cash decreases (it goes wherever you purchased). There is no change to your deposit account and no change to reserves. The incoming bank's cash account and liability account associated with that business transaction account increase, and it is trivial to transfer the % of cash necessary to reach minimum reserve requirements to the Fed. Secondly, anyone with a smidgen of accounting can tell that his balance sheet won't balance.", "title": "" }, { "docid": "94ddf1032cb45bb5c777b866ae873592", "text": "\"I found your post while searching for this same exact problem. Found the answer on a different forum about a different topic, but what you want is a Cash Flow report. Go to Reports>Income & Expenses>Cash Flow - then in Options, select the asset accounts you'd like to run the report for (\"\"Calle's Checking\"\" or whatever) and the time period. It will show you a list of all the accounts (expense and others) with transactions effecting that asset. You can probably refine this further to show only expenses, but I found it useful to have all of it listed. Not the prettiest report, but it'll get your there.\"", "title": "" }, { "docid": "a3cb261d0561cda92eabd6e103677895", "text": "I use Banktivity. It's very much not free, but it automatically downloads all my bank and credit card activity and has excellent reporting options.", "title": "" }, { "docid": "e4fd4caeba66a11f04131154e9c7d968", "text": "Track your spending and expected income -- on paper, or with a personal-finance program. If you know how much is committed, you know how much is available. Trivial with checks, requires a bit more discipline with credit cards.", "title": "" }, { "docid": "87f7466bc890563ee9345c8834bfb181", "text": "Also, unless I missed it and someone already mentioned it, do keep in mind the impact of these credit cards balances on your credit score. Over roughly 75% usage on a given credit account reflects badly on your score and has a pretty large impact on how your worthiness is calculated. It gives the impression that you are a person that lives month to month on cards, etc. If you could get both cards down to reasonable balances to where you could begin paying on them regularly and work them down over time, that will not only look incredible for your credit report but also immediately begin making your credit worthiness begin to raise due to the fact that you will not have accounts that (I'm assuming here) are at very high usage (over 75% of your total limit.) If you have to get one card knocked out just to get breathing room, and you're boxed in here -- or honestly even if the mental stress is causing you incredible hardship day to day, then I suppose blow one card out of the water, reassess and start getting to work on that second card. I hope this helped, I'm no expert, but I have had every kind of luck with credit cards and accounts you could think of, so I can only give my experience from the rubber-meets-the-road perspective. Good luck!", "title": "" }, { "docid": "c7afccda4f53df1e4510720d6f68014f", "text": "\"I want to recommend an exercise: Find all the people nearby who you can talk to in less than 24 hours about credit cards: Your family, whoever lives with you, and friends. Now, ask each of them \"\"what's the worst situation you've gotten yourself into with a credit card?\"\" Personally, the ratio of people who I asked who had credit cards to the ratio of people with horror stories about how credit cards screwed up their credit was nearly 1:1. Pretty much, only one of them had managed to avoid the trap that credit cards created (that sole exception had worked for the government at a high paying job and was now retired with adult children and a lucrative pension). Because it's trivially easy over-extend yourself, as a result of how credit cards work (if you had the cash at any second, you would have no need for the credit). But do your own straw poll, and then see what the experience of people around you has been. And if there's a lot more bad than good out there, then ask yourself \"\"am I somehow more fiscally responsible than all of these people?\"\".\"", "title": "" }, { "docid": "edcdae945b83a18c7c90645115ed8420", "text": "\"What you are describing sounds a lot like the way we handle our household budget. This is possible, but quite difficult to do with an Excel spreadsheet. It is much easier to do with dedicated budgeting software designed for this purpose. When choosing personal budgeting software, I've found that the available packages fall in two broad categories: Some packages take what I would call a proactive approach: You enter in your bank account balances, and assign your money into spending categories. When you deposit your paycheck, you do the same thing: you add this money to your spending categories. Then when you spend money, you assign it to a spending category, and the software keeps track of your category balances. At any time, you can see both your bank balances and your spending category balances. If you need to spend money in a category that doesn't have any more money, you'll need to move money from a different category into that one. This approach is sometimes called the envelope system, because it resembles a digital version of putting your cash into different envelopes with different purposes. A few examples of software in this category are You Need a Budget (YNAB), Mvelopes, and EveryDollar. Other packages take more of a reactive approach: You don't bother assigning a job to the money already in your bank account. Instead, you just enter your monthly income and put together a spending plan. As you spend money, you assign the transactions to a spending category, and at the end of the month, you can see what you actually spent vs. what your plan was, and try to adjust your next budget accordingly. Software that takes this approach includes Quicken and Mint.com. I use and recommend the proactive approach, and it sounds from your question like this is the approach that you are looking for. I've used several different budgeting software packages, and my personal recommendation is for YNAB, the software that we currently use. I don't want this post to sound too much like a commercial, but I believe it will do everything you are looking for. One of the great things about the proactive approach, in my opinion, is how credit card accounts are handled. Since your spending category balances only include real money actually sitting in an account (not projected income for the month), when you spend money out of a category with your credit card, the software deducts the money from the spending category immediately, as it is already spent. The credit card balance goes negative. When the credit card bill comes and you pay it, this is handled in the software as an account transfer from your checking account to your credit card account. The money in the checking account is already set aside for the purpose of paying your credit card bill. Dedicated budgeting software generally has a reconcile feature that makes verifying your bank statements very easy. You just enter the date of your bank statement and the balance, and then the software shows you a list of the transactions that fall in those dates. You can check each one against the transactions on the statement, editing the ones that aren't right and adding any that are missing from the software. After everything checks out, the software marks the transactions as verified, so you can easily see what has cleared and what hasn't. Let me give you an example to clarify, in response to your comment. This example is specific to YNAB, but other software using the same approach would work in a similar way. Let's say that you have a checking account and a credit card account. Your checking account, named CHECKING, has $2,000 in it currently. Your credit card currently has nothing charged on it, because you've just paid your bill and haven't used it yet this billing period. YNAB reports the balance of your credit card account (we'll call this account CREDITCARD), as $0. Every dollar in CHECKING is assigned to a category. For example, you've got $200 in \"\"groceries\"\", $100 in \"\"fast food\"\", $300 in \"\"rent\"\", $50 in \"\"phone\"\", $500 in \"\"emergency fund\"\", etc. If you add up the balance of all of your categories, you'll get $2,000. Let's say that you've written a check to the grocery store for $100. When you enter this in YNAB, you tell it the name of the store, the account that you paid with (CHECKING), and the category that the expense belongs to (groceries). The \"\"groceries\"\" category balance will go down from $200 to $100, and the CHECKING account balance will go down from $2,000 to $1,900. Now, let's say that you've spent $10 on fast food with your credit card. When you enter this in YNAB, you tell it the name of the restaurant, the account that you paid with (CREDITCARD), and the category that the expense belongs to (fast food). YNAB will lower the \"\"fast food\"\" category balance from $100 to $90, and your CREDITCARD account balance will go from $0 to $-10. At this point, if you add up all the category balances, you'll get $1,890. And if you add up your account balances, you'll also get $1,890, because CHECKING has $1,900 and CREDITCARD has $-10. If you get your checking account bank statement at this time, the account balance of $1,900 should match the statement and you'll see the payment to the grocery store, assuming the check has cleared. And if the credit card bill comes now, you'll see the fast food purchase and the balance of $-10. When you write a check to pay this credit card bill, you enter this in YNAB as an account transfer of $10 from CHECKING to CREDITCARD. This transfer does not affect any of your category balances; they remain the same. But now your CHECKING account balance is down to $1,890, and CREDITCARD is back to $0. This works just as well whether you have one checking account and one credit card, or 2 checking accounts, 2 savings accounts, and 3 credit cards. When you want to spend some money, you look at your category balance. If there is money in there, then the money is available to spend somewhere in one of your accounts. Then you pick an account you want to pay with, and, looking at the account balance, if there isn't enough money in that account to pay it, you just need to move some money from another account into that one, or pick a different account. When you pay for an expense with a credit card, the money gets deducted from the category balances immediately, and is no longer available to spend on something else.\"", "title": "" }, { "docid": "c6fa632a4fe912a3d78b7a6592e82079", "text": "\"I wrote a little program one time to try to do this. I think I wrote it in Python or something. The idea was to have a list of \"\"projected expenses\"\" where each one would have things like the amount, the date of the next transaction, the frequency of the transaction, and so on. The program would then simulate time, determining when the next transaction would be, updating balances, and so on. You can actually do a very similar thing with a spreadsheet where you basically have a list of expenses that you manually paste in for each month in advance. Simply keep a running balance of each row, and make sure you don't forget any transactions that should be happening. This works great for fixed expenses, or expenses that you know how much they are going to be for the next month. If you don't know, you can estimate, for instance you can make an educated guess at how much your electric bill will be the next month (if you haven't gotten the bill yet) and you can estimate how much you will spend on fuel based on reviewing previous months and some idea of whether your usage will differ in the next month. For variable expenses I would always err on the side of a larger amount than I expected to spend. It isn't going to be possible to budget to the exact penny unless you lead a very simple life, but the extra you allocate is important to cushion unexpected and unavoidable overruns. Once you have this done for expenses against your bank account, you can see what your \"\"low water mark\"\" is for the month, or whatever time period you project out to. If this is above your minimum, then you can see how much you can safely allocate to, e.g. paying off debt. Throwing a credit card into the mix can make things a bit more predictable in the current month, especially for unpredictable amounts, but it is a bit more complicated as now you have a second account that you have to track that has to get deducted from your first account when it becomes due in the following month. I am assuming a typical card where you have something like a 25 day grace period to pay without interest along with up to 30 days after the expense before the grace period starts, depending on the relationship between your cut-off date and when the actual expense occurs.\"", "title": "" }, { "docid": "50b54ee0f2d50fba4547d1c2c497b452", "text": "A debit card takes the funds right from your account. There's no 'credit' issued along the way. The credit card facilitates a short term loan. If you are a pay-in-full customer, as I am, there's a cost to lend the money, but we're not paying it. It's part of the fee charged to the merchant. Thus the higher transaction cost.", "title": "" }, { "docid": "580d7128f24e08befbe78bf7c0f80f29", "text": "Essentially speaking, when you purchase goods worth $100 using your card, the store has to pay about $2 for the transaction to the company that operates that stores' credit card terminal. If you withdraw cash from an ATM, you might be charged a fee for such a transaction. However, the ATM operator doesn't pay the credit processor such a transaction fee - thus, it is classified as a cash transaction. Additionally, performing cash advances off a CC is a rather good indicator of a bad financial health of the user, which increase the risk of default, and in some institutions is a factor contributing to their internal creditworthiness assessment.", "title": "" } ]	fiqa
d6198ad6e4d07aba8b7f9ad3e1720285	Where can I get interesting resources on Commodities?	[ { "docid": "c6608fe20149388b7b6e8d705c69432f", "text": "Here are some pretty big name news agencies which have a section dedicated to commodities: CNN Bloomberg Reuters", "title": "" }, { "docid": "a5c24dda372ef6aacc271ce6f77061ca", "text": "I would recommend that go through some forums where commodities topics be discussed so that if you have some issues related any point in commodities investment you will easily get your question sort out.", "title": "" } ]	[ { "docid": "928ba5ae5711711eb466cf98a7443829", "text": "So the easy to extract petroleum products are diminishing in supply and the petroleum extraction companies have to expend more capitol to get the commodities they sell on an open market and that's hurting their profit margin? Who could have ever envisioned such a situation?", "title": "" }, { "docid": "2c5df2b6c4ff11f450bdaaf905ce829c", "text": "\"Grain primarily, but pretty much any other commodity you can think of has pretty high scrutiny. Oil is important because without it US can't go to war (a position it found itself close to in WWII) Read \"\"The Prize\"\" by Daniel Yergin\"", "title": "" }, { "docid": "9f5ed230cf4c73a42daaba1dcdd471fd", "text": "Wells Fargo has a good free product that you can sign up for on their website. Google Wells Fargo Economics. I think that will get you there. If you have a friend on a trading desk you can get the JPM morning note which is really good too.", "title": "" }, { "docid": "77ecf212f4efc907eee18d547f3912ca", "text": "No career advice or homework help (unless your homework is some kind of big project and you need an explanation on a concept). I want to see financial news, legislation concerning the markets and regulation, self posts about financial concepts, opinion articles about finance from reputable sources, etc.", "title": "" }, { "docid": "f9b2b463faf9513e4ff7d222ccc92672", "text": "You can use www.etfdb.com and search on geography.", "title": "" }, { "docid": "31b3c1f70fe06fe230cde5a7ce490664", "text": "I know I can not trade futures realistically (I never claimed I could). All I wanted was some exposure to commodities. If I could just trade many of these things in an ETF like GLD or XLV, I would have done that. On the topic of margin, I appreciate your explaining that to me. I admit readily that I could never invest in futures straight, but I would like to get into commodities and other types of investments. I have tried to look for value in the market, but I have not found many things I would put my money in. I have gone as far as to look through OTC ADRs to find some foreign value, and I found nothing. I just want to be able to trade in any market, and I would consider shorting, but I don't like to be too risky. I want to go long on positions, and it seemed like commodities may be a good speculation to LOOK INTO. Taking rough rice as an example, there are millions (if not billions) of people who eat rice to survive. People will always need oil to fuel their cars. People will always need electricity. So I guess what I am trying to do is look into things that allow me to profit, regardless of where equities are going. The only thing I want to do is trade the options of the futures, not the actual futures themselves. I hope I did not confuse you. If I can earn even $20 from buying an option at a lower price and selling higher, it would allow me to have a greater breadth of tools to use when the market may be overvalued.", "title": "" }, { "docid": "4b5803c98d5cc82b2bd2ea04492ea180", "text": "\"Things like the air, fisheries, forests, oil fields, research science teams, etc. are \"\"commons goods\"\". They're scarce, but you can't actually stop anyone from using them or benefiting from them. They normally have no property rights and can't extract revenue for their own work or good. So pollution permits, or fishing licenses, are charged as commons rents.\"", "title": "" }, { "docid": "86b61a90ea52490a30f14b30e5b529ea", "text": "I really want people to answer this. I need to build my general macro repertoire and good news is key. I was getting the Bridgewater Dailies at my last job and they are fantastic. Unfortunately they are super expensive and only businesses can afford them. I read a lot of the general economics output of major banks which is free on their websites. I also read a selection of blogs which have an economics/macro tilt, but tend to be a lot of opinion and academic stuff. This is what I've been reading recently: [Krugman](http://krugman.blogs.nytimes.com/) [Marginal Revolution](http://marginalrevolution.com/) [Project Syndicate](http://www.project-syndicate.org/) [Noah Smith](http://noahpinionblog.blogspot.jp/) [The Upshot](http://www.nytimes.com/upshot/) I also read Reuters for economics news generally since there is no paywall. Hope this helps, and I really hope there is more quality free stuff out there that I've missed.", "title": "" }, { "docid": "1865539905ccd215667159563cef7d6f", "text": "> Taking rough rice as an example, there are millions (if not billions) of people who eat rice to survive. People will always need oil to fuel their cars. People will always need electricity. Commodity values are unlikely to go to 0, I agree. The fact you think this is super-relevant suggests to me you have not fully grasped the nature of the commodities futures markets. > I don't like to be too risky You are looking at getting into extremely risky securities. > I guess what I am trying to do is look into things that allow me to profit, regardless of where equities are going. Many men have died searching for the holy grail. Speculating in these markets is not for the faint of hearts, let alone for the risk-averse. > I have gone as far as to look through OTC ADRs to find some foreign value, and I found nothing. There are plenty of funds offering lots of exposure to international equities, which seem well-geared toward the individual investor.", "title": "" }, { "docid": "2e63f3f7896d17a857595064d950530d", "text": "-I understand. If the option expires and you paid a premium of let's say $20, then you loose it. I will still have to read more obviously. If there are other ways to play the commodities market in a safer way, I am more than willing to look into it. -I understand futures and options on futures are more risky than stocks. What I am getting at is it is less risky COMPARED to regular futures. Compared to the available choices, this seems like the safest. I understand I can loose all the money I invest/speculate with. But loosing $10 (or whatever the price of said commodity options are), is still better than loosing thousands. I agree though I should do my do diligence. -What I am getting at is obviously certain things are correlated with bull or bear markets (gold bear, growth stocks bull). If you can use a combination of assets, you can have some that are winners, while some will be down. I don't expect one asset to be a super asset. -But most the stocks are overvalued, and are overrated. I have found several stocks that I am invested in (MGM Macau, Lippo Mall, and Whiting Trust II). I am also in gold, silver, small Riyal position, and Norwegian Kroner.", "title": "" }, { "docid": "5819b1b16bb5a329fb87dea149f8148b", "text": "Goldprice.org has different currencies and historical data. I think silverprice.org also has historical data.", "title": "" }, { "docid": "d5d28e786242fbca478a6cf28af79948", "text": "Itunes U has some really good online classes on economics. And as with a lot of things check out Khanacademy.org. He has a whole financial section of really well made videos. Good books to read regarding the financial crisis are The Big Short by Lewis and Too Big To Fail by Sorkin.", "title": "" }, { "docid": "b5e06ae5797a21d78982d8329f0a8175", "text": "\"A good reference to what encompasses \"\"securities\"\" are detailed in the Securities Act of 1933, which was enacted by the United States federal government. One main exception, which I would still consider securities for your purposes, would be \"\"commercial paper\"\". These are exempt from the securities act because they mature in 270 days of less, but they function much like bonds or promissory notes Therefore though, it would not encompass currencies and commodities. It really comes down to the structure of the agreement for transferring or holding the particular kind of underlying asset.\"", "title": "" }, { "docid": "806651ff0762f9f2bbc26d6187494ea9", "text": "I'm all-in on hard silver, a small portion is stored at my house for emergency expenditures and the vast majority is in a high-security vault in Canada. That was actually the cheapest place I could find for long-term storage and insurance, which happened to be off-shore. It could turn out to be beneficial to be off-shore though. In the 1930s gold became illegal to privately own its very possible they could do the same this time, although they didn't in 1979. Oil is too high in volume to reasonably store. Gold isn't as undervalued as silver, which I could spend a full day talking about. But to sum it up in a few points: there is less silver than there is gold, gold has a premium for jewelry which will likely go down in a crash even though you will still see gains, silver is the second most used commodity besides oil, less people are in the know about it, silver prices were actually higher than gold a few times in the past century, simply measuring the dow in silver will show it's further below the historical average compared to gold. I'll stop there, but I could go on though on silver if people want. Real-estate is still very expensive from the 2008 recession, traditionally mortgages are $1.05 per dollar you would spend on renting the same property. Currently real-estate is at like $1.25+ I believe, It peaked at about $1.95. I rent, to save money, which you can spend on other assets. If one's willing to move to another state for lower taxes, they definitely should. Employment is going to be harder to come by, and they should get as much out of it as possible as they can. If they don't save enough, they could end up just using their entire savings during the whole thing if they can't find a job, in which case at the end you'd never know they knew it was going to happen. Overall I don't think this crash is going to be like the great depression. I don't feel compelled to store food and buy a generator or anything. I believe the living will be easier than it were to live in the 90s for those who are invested in assets. Everything is going to be on sale, meanwhile their wealth will be increasing. Depending on how much they own it could be increasing faster than they need to spend it. Sounds like the life to me. But with that said those without real assets, especially the lower class, will be unemployed and living on food stamps. Perhaps even the food stamps making more people leave the dollar and the economy. This actually might not be a prediction and is what happening already. But I don't believe anybody, in america at least, will be starving. In the 30s we had not mastered industry farming yet and we had the dustbowl to make things worse. Crime though, I'd own a gun. The protesters are here already, and I think we are just passing the half-way point right now, they will get angrier. I don't know enough about taxes to know the best country or place to store to combat taxes. Maybe someone else can chime in. I'm in canada to avoid high insurance and storage fees. And for careful selection of primary residence, In the long haul I'd rent a small apartment, as small and cheap as possible. In a safe neighborhood, but not so much secluded that a single grocery store or gas station going out of business could ruin it.", "title": "" }, { "docid": "589c916aea3a5fdabf66704468b2d677", "text": "Here is a list of threads in other subreddits about the same content: * [Wealth Management Products in China [pdf]](https://www.reddit.com/r/Economics/comments/78kwt4/wealth_management_products_in_china_pdf/) on /r/Economics with 3 karma (created at 2017-10-25 10:50:52 by /u/LtCmdrData) ---- ^^I ^^am ^^a ^^bot ^^[FAQ](https://www.reddit.com/r/DuplicatesBot/wiki/index)-[Code](https://github.com/PokestarFan/DuplicateBot)-[Bugs](https://www.reddit.com/r/DuplicatesBot/comments/6ypgmx/bugs_and_problems/)-[Suggestions](https://www.reddit.com/r/DuplicatesBot/comments/6ypg85/suggestion_for_duplicatesbot/)-[Block](https://www.reddit.com/r/DuplicatesBot/wiki/index#wiki_block_bot_from_tagging_on_your_posts) ^^Now ^^you ^^can ^^remove ^^the ^^comment ^^by ^^replying ^^delete!", "title": "" } ]	fiqa
126330b7dde26018f40680a91429c0d6	Strange values in ARM.L price data 1998-2000 from Yahoo	[ { "docid": "fd1c51438c9aaf8e14aa77f9887fc3c7", "text": "This is just a shot in the dark but it could be intermarket data. If the stock is interlisted and traded on another market exchange that day then the Yahoo Finance data feed might have picked up the data from another market. You'd have to ask Yahoo to explain and they'd have to check their data.", "title": "" } ]	[ { "docid": "2649f29b989d8e7f895fca5b3d7d7194", "text": "\"At the bottom of Yahoo! Finance's S & P 500 quote Quotes are real-time for NASDAQ, NYSE, and NYSE MKT. See also delay times for other exchanges. All information provided \"\"as is\"\" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein. Fundamental company data provided by Capital IQ. Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data, daily updates, fund summary, fund performance, dividend data and Morningstar Index data provided by Morningstar, Inc. Orderbook quotes are provided by BATS Exchange. US Financials data provided by Edgar Online and all other Financials provided by Capital IQ. International historical chart data, daily updates, fundAnalyst estimates data provided by Thomson Financial Network. All data povided by Thomson Financial Network is based solely upon research information provided by third party analysts. Yahoo! has not reviewed, and in no way endorses the validity of such data. Yahoo! and ThomsonFN shall not be liable for any actions taken in reliance thereon. Thus, yes there is a DB being accessed that there is likely an agreement between Yahoo! and the providers.\"", "title": "" }, { "docid": "5ff0d2b58a0072ba0922d31010282b2d", "text": "There are companies who sell data gleaned in aggregate from credit card providers to show how much of what category of product is sold online or offline, but that data is not cheap. 1010data is one such data aggregator we are talking to right now. Haven’t seen pricing yet but I expect 6 figures to access the data", "title": "" }, { "docid": "f70265ed3e89fe16f52b76e56bffb18d", "text": "It is because 17th was Friday, 18th-19th were weekends and 20th was a holiday on the Toronto Stock Exchange (Family Day). Just to confirm you could have picked up another stock trading on TMX and observed the price movements.", "title": "" }, { "docid": "756e78426f383d7d85ced0fe4ffce165", "text": "The 15% Alibaba stake was invested in way before Mayer's came on board. It's worth $51.75B right now. Yahoo Japan is an autonomous company, that Yahoo has a 36% stake in, spun off well before Mayer's came on board and that stake is conservatively worth$10B. Yahoo market cap is only $49B right now. If anything, Marissa Mayers tenure just killed off the core value of Yahoo itself to the level that it's a liability and it's asset portfolio is the only thing holding it aloft.", "title": "" }, { "docid": "6d2bbe8026eb8335cb86b52eee7df766", "text": "\"For the S&P and many other indices (but not the DJIA) the index \"\"price\"\" is just a unitless number that is the result of a complicated formula. It's not a dollar value. So when you divide said number by the earnings/share of the sector, you're again getting just a unitless number that is incomparable to standard P-E ratios. In fact, now that I think about, it kinda makes sense that each sector would have a similar value for the number that you're computing, since each sector's index formula is presumably written to make all the index \"\"price\"\"s look similar to consumers.\"", "title": "" }, { "docid": "f4f42a26d035479427867cc4eb653fc4", "text": "Two reasons why I think that's irrelevant: First, if it was on 3/31/2012 (two other sources say it was actually 4/3/2012), why the big jump two trading days later? Second, the stock popped up from $3.10 to $4.11, then over the next several trading days fell right back to $3.12. If this were about the intrinsic value of the company, I'd expect the stock to retain some value.", "title": "" }, { "docid": "9d9cfa352ce07f9aa89d06d2a710373e", "text": "I don't see it in any of the exchange feeds I've gone through, including the SIPs. Not sure if there's something wrong with Nasdaq Last Sale (I don't have that feed) but it should be putting out the exact same data as ITCH.", "title": "" }, { "docid": "3ae22710c80a01cf0fa6319f8862dcff", "text": "Apparent data-feed issues coming out of NASDAQ in the after hours market. Look at MSFT, AMZN, AAPL, heck even Sears. Funny thing though, is that you see traces of irregular prices during the active session around 10:20am on stocks like GOOG.", "title": "" }, { "docid": "51b119949722b2a428b636acee721e2d", "text": "Look at the 'as of'. Google's as of is 11:27 whil Yahoo's is 11:19. Given the shape of the Google curve, it looks to me that Yahoo's may well drop that much in the next 8 minutes. In fact, looking at it now, Yahoo's algorithm showed it as about 30 at 11:24, before going back up again some. It may not have been identical to Google's, but it was certainly close.", "title": "" }, { "docid": "1ca4aa43255f1b1f575ff0e602651839", "text": "\"Remember that in most news outlets journalists do not get to pick the titles of their articles. That's up to the editor. So even though the article was primarily about ETFs, the reporter made the mistake of including some tangential references to mutual funds. The editor then saw that the article talked about ETFs and mutual funds and -- knowing even less about the subject matter than the reporter, but recognizing that more readers' eyeballs would be attracted to a headline about mutual funds than to a headline about ETFs -- went with the \"\"shocking\"\" headline about the former. In any case, as you already pointed out, ETFs need to know their value throughout the day, as do the investors in that ETF. Even momentary outages of price sources can be disastrous. Although mutual funds do not generally make transactions throughout the day, and fund investors are not typically interested in the fund's NAV more than once per day, the fund managers don't just sit around all day doing nothing and then press a couple buttons before the market closes. They do watch their NAV very closely during the day and think very carefully about which buttons to press at the end of the day. If their source of stock price data goes offline, then they're impacted almost as severely as -- if less visibly than -- an ETF. Asking Yahoo for prices seems straightforward, but (1) you get what you pay for, and (2) these fund companies are built on massive automated infrastructures that expect to receive their data from a certain source in a certain way at a certain time. (And they pay a lot of money in order to be able to expect that.) It would be quite difficult to just feed in manual data, although in the end I suspect some of these companies did just that. Either they fell back to a secondary data supplier, or they manually constructed datasets for their programs to consume.\"", "title": "" }, { "docid": "ff68b09fef2ab83c41d8cf7759d12c2c", "text": "The point of that question is to test if the user can connect shares and stock price. However, that being said yeah, you're right. Probably gives off the impression that it's a bit elementary. I'll look into changing it asap.", "title": "" }, { "docid": "6f8f4f0e86dfd43dd70b7d48f6ee9d1f", "text": "A number of places. First, fast and cheap, you can probably get this from EODData.com, as part of a historical index price download -- they have good customer service in my experience and will likely confirm it for you before you buy. Any number of other providers can get it for you too. Likely Capital IQ, Bloomberg, and other professional solutions. I checked a number of free sites, and Market Watch was the only that had a longer history than a few months.", "title": "" }, { "docid": "ea4549ecee88d0ebf51be242700a3fa2", "text": "Am I missing something or is the author? EUP5 USP5 SUP5 PUS5 EDIT: Its not just currency pairs either, 5DEL; EU5L; 5UKL; EU5S; 5DES. Unless I misunderstood something, the authors worst nightmare has already arrived in Europe.", "title": "" }, { "docid": "57fb897c059fe117bf76781c5306adb8", "text": "\"Thanks for the response. I am using WRDS database and we are currently filtering through various variables like operating income, free cash flow etc. Main issue right now is that the database seems to only go up to 2015...is there a similar database that has 2016 info? filtering out the \"\"recent equity issuance or M&A activity exceeding 10% of total assets\"\" is another story, namely, how can I identify M&A activity? I suppose we can filter it with algorithm stating if company's equity suddenly jumps 10% or more, it get's flagged\"", "title": "" }, { "docid": "79d5438b0c557a93e7157a96506906bf", "text": "I work on a buy-side firm, so I know how these small data issues can drive us crazy. Hope my answer below can help you: Reason for price difference: 1. Vendor and data source Basically, data providers such as Google and Yahoo redistribute EOD data by aggregating data from their vendors. Although the raw data is taken from the same exchanges, different vendors tend to collect them through different trading platforms. For example, Yahoo, is getting stock data from Hemscott (which was acquired by Morningstar), which is not the most accurate source of EOD stocks. Google gets data from Deutsche Börse. To make the process more complicated, each vendor can choose to get EOD data from another EOD data provider or the exchange itself, or they can produce their own open, high, low, close and volume from the actual trade tick-data, and these data may come from any exchanges. 2. Price Adjustment For equities data, the re-distributor usually adjusts the raw data by applying certain customized procedures. This includes adjustment for corporate actions, such as dividends and splits. For futures data, rolling is required, and back-ward and for-warding rolling can be chosen. Different adjustment methods can lead to different price display. 3. Extended trading hours Along with the growth of electronic trading, many market tends to trade during extended hours, such as pre-open and post-close trading periods. Futures and FX markets even trade around the clock. This leads to another freedom in price reporting: whether to include the price movement during the extended trading hours. Conclusion To cross-verify the true price, we should always check the price from the Exchange where the asset is actually traded. Given the convenience of getting EOD data nowadays, this task should be easy to achieve. In fact, for professional traders and investors alike, they will never reply price on free providers such as Yahoo and Google, they will most likely choose Bloomberg, Reuters, etc. However, for personal use, Yahoo and Google should both be good choices, and the difference is small enough to ignore.", "title": "" } ]	fiqa
75ca08aaea0222753a6ebafa160f2198	Is there a term that better describes a compound annual growth rate (CAGR) when it is negative?	[ { "docid": "22e79e3d62081a5bedf1619dcd604a0c", "text": "\"Not sure why CAGR is a problem for both directions. I used to be a physicist, and, when I taught classes in graduate school, students always wanted to use the terms \"\"accelerate\"\" and \"\"decelerate\"\" to describe \"\"speeding up\"\" and \"\"slowing down\"\". But acceleration is just a vector with magnitude and direction. There's nothing special about slowing down that it needs a special name. It's just acceleration in a direction opposite to the direction of motion. I think the same thing applies here. There's nothing special about negative growth rates that they need a special name. Just stick a minus sign in front of the number and you convey the required information.\"", "title": "" }, { "docid": "39334987b43c60114059a16406318413", "text": "\"My experience is in economics, so it may differ from an accounting or personal finance perspective somewhat; that being said, I find it perfectly acceptable to use a term like CAGR when the rate is positive or negative. Economists talk about negative growth rates all the time, and it's universally assumed that growth rates can be positive or negative.1 Ideally, the actual magnitude and sign of the value should be specified by the value itself. The term, whether it's \"\"growth rate\"\", some modified version of it like CAGR, or any label in a table or on a graph, should describe the calculation or source used obtain the value. I shouldn't need the name to indicate the sign of the number if the number is present; the name is only there to help me understand the value. Unfortunately, I don't know of any specific term that represents the geometric averaging nature of CAGR and also eliminates the minor potential for semantic confusion. However, I think the minor problem of semantics needs to be balanced against the tradeoff of using a different term that isn't as common, if one were to exist. CAGR is a standard, well-known term that a) allows someone who is familiar with the term to instantly understand the procedure you're using, and b) allow someone who isn't familiar with it to quickly search and find an explanation, since searching for CAGR will numerous simple explanations of how it's calculated. 1. This is different from the concept of economic growth, which is usually assumed to be positive in informal discussions. In economic modeling, many of the first steps in creating a model are symbolic anyway, so \"\"growth rate,\"\", \"\"change in output\"\", and \"\"economic growth\"\" are used interchangeably to describe changes in GDP because the values either aren't known, irrelevant until later in the project, or pulled from data that describes it using one or several of the previously stated terms.\"", "title": "" }, { "docid": "7b9ec764c1c3d6a690c6aaf71c24eacc", "text": "Same question had popped up in our office,and we got an answer from one of the senior colleague. He said that we can call it CARC (Compounded Annual Rate of Change).", "title": "" } ]	[ { "docid": "76c6225dc5f0d9e48a5430310a5a8e41", "text": "This is only a rule of thumb. Peter Lynch popularized it; the ratio PE/growth is often called the Lynch Ratio. At best it's a very rough guideline. I could fill up this page with other caveats. I'm not saying that it's wrong, only that it's grossly incomplete. For a 10 second eyeball valuation of growth stocks, it's fine. But that's the extent of its usefulness.", "title": "" }, { "docid": "48c01e8025f37a2255ffd3c048d8b06a", "text": "Perhaps something else comes with the bond so it is a convertible security. Buffett's Negative-Interest Issues Sell Well from 2002 would be an example from more than a decade ago: Warren E. Buffett's new negative-interest bonds sold rapidly yesterday, even after the size of the offering was increased to $400 million from $250 million, with a possible offering of another $100 million to cover overallotments. The new Berkshire Hathaway securities, which were underwritten by Goldman, Sachs at the suggestion of Mr. Buffett, Berkshire's chairman and chief executive, pay 3 percent annual interest. But they are coupled with five-year warrants to buy Berkshire stock at $89,585, a 15 percent premium to Berkshire's stock price Tuesday of $77,900. To maintain the warrant, an investor is required to pay 3.75 percent each year. That provides a net negative rate of 0.75 percent.", "title": "" }, { "docid": "dc38b60a0e383d11c098c69517619c7f", "text": "In the equity markets, the P/E is usually somewhere around 15. The P/E can be viewed as the inverse of the rate of a perpetuity. Since the average is 15, and the E/P of that would be 6.7%, r should be 6.7% on average. If your business is growing, the growth rate can be incorporated like so: As you can see, a high g would make the price negative, in essence the seller should actually pay someone to take the business, but in reality, r is determined from the p and an estimated g. For a business of any growth rate, it's best to compare the multiple to the market, so for the average business in the market with your business's growth rate and industry, that P/E would be best applied to your company's income.", "title": "" }, { "docid": "1d16e19bebdb3205c784f300b9c4a725", "text": "\"The S&P 500 index from 1974 to present certainly looks exponential to me (1974 is the earliest data Google has). If you read Jeremy Siegel's book there are 200 year stock graphs and the exponential nature of returns on stocks is even more evident. This graph only shows the index value and does not include the dividends that the index has been paying all these years. There is no doubt stocks have grown exponentially (aka have grown with compound interest) for the past several decades and compounded returns is definitely not a \"\"myth\"\". The CAGR on the S&P 500 index from 1974 to present has been 7.54%: (1,783 / 97.27) ^ (1 / 40) - 1 Here is another way to think about compounded investment growth: when you use cash flow from investments (dividends, capital gains) to purchase more investments with a positive growth rate, the investment portfolio will grow exponentially. If you own a $100 stock that pays 10% dividends per year and spend the dividends every year without reinvesting them, then the investment portfolio will still be worth $100 after 40 years. If the dividends are reinvested, the investment portfolio will be worth $4,525 after 40 years from the many years of exponential growth: 100*(1 + 10%)^40\"", "title": "" }, { "docid": "3bfae4ee3ce21e5318f8c77e2a1927e1", "text": "I would use neither method. Taking a short example first, with just three compounding periods, with interest rate 10%. The start value y0 is 1. So after three years the value is 1.331, the same as y0 (1 + 0.1)^3. Depreciating (like inflation) by 10% (to demonstrate) gets us back to y0 = 1 Appreciating and depreciating by 10% cancels out: Appreciating by 10% interest and depreciating by 3% inflation: This is the same as y0 (1 + 0.1)^3 (1 + 0.03)^-3 = 1.21805 So for 50 years the result is y0 (1 + 0.1)^50 (1 + 0.03)^-50 = 26.7777 Note You can of course use subtraction but the not using the inflation figure directly. E.g. (edit: This appears to be the Fisher equation.) 2nd Note Further to comments, here is a chart to illustrate how much the relative performance improves when inflation is accounted for. The first fund's return is 6% and the second fund's return varies from 3% to 6%. Inflation is 3%.", "title": "" }, { "docid": "70d0915408fb98db5d2f5e7cb0c31731", "text": "Assuming cell A1 contains the number of trades: will price up to A1=100 at 17 each, and the rest at 14 each. The key is the MAX and MIN. They keep an item from being counted twice. If X would end up negative, MAX(0,x) clamps it to 0. By extension, if X-100 would be negative, MAX(0, X-100) would be 0 -- ie: that number doesn't increase til X>100. When A1=99, MIN(a1,100) == 99, and MAX(0,a1-100) == 0. When A1=100, MIN(a1,100) == 100, and MAX(0,a1-100) == 0. When A1=101, MIN(a1,100) == 100, and MAX(0,a1-100) == 1. Of course, if the 100th item should be $14, then change the 100s to 99s.", "title": "" }, { "docid": "7e2e68179cb7715afc6b734828b30557", "text": "PE can be misleading when theres a good risk the company simply goes out of business in a few years. For this reason some people use PEG, which incorporates growth into the equation.", "title": "" }, { "docid": "b27e71a404f46fc0845924799db1fdac", "text": "\"In double-entry bookkeeping, no transaction is ever negative. You only deal in positive numbers. We \"\"simulate\"\" negative numbers by calling numbers debits and credits, where one is the negative of the other. Only a balance can be negative. In this case, Income is a credit account. That means that things that increase your balance are credits and things that reduce your balance are debits. So a gift from grandma is a credit. It's a positive number, and you write it in the credit column. You pretty much never subtract from Income except to correct a mistake. Assets, like a checking account, are debit accounts. Increases are debits and decreases are credits. You routinely have both debits and credits on a checking account, i.e. you put money in and you take money out. Every transaction affects (at least) two accounts: one with a debit and one with a credit. So in this case, the gift from grandma credits income and debits checking. Buying food credits checking and debits expenses.\"", "title": "" }, { "docid": "3f7bfbd56d669e0399eb055e331c64dd", "text": "Set your xirr formula to a very tall column, leaving lots of empty rows for future additions. In column C, instead of hardcoding the value, use a formula that tests if it's the current bottom entry, like this: =IF(ISBLANK(A7),-C6, C6) If the next row has no date entered (yet), then this is the latest value, and make it negative. Now, to digress a bit, there are several ways to measure returns. I feel XIRR is good for individual positions, like holding a stock, maybe buying more via DRIP, etc. For the whole portfolio it stinks. XIRR is greatly affected by timing of cash flows. Steady deposits and no withdrawals dramatically skew the return lower. And the opposite is true for steady withdrawals. I prefer to use TWRR (aka TWIRR). Time Weighted Rate of Return. The word 'time' is confusing, because it's the opposite. TWRR is agnostic to timing of cashflows. I have a sample Excel spreadsheet that you're welcome to steal from: http://moosiefinance.com/static/models/spreadsheets.html (it's the top entry in the list). Some people prefer XIRR. TWRR allows an apples-to-apples comparison with indexes and funds. Imagine twin brothers. They both invest in the exact same ideas, but the amount of cash deployed into these ideas is different, solely because one brother gets his salary bonus annually, in January, and the other brother gets no bonus, but has a higher bi-weekly salary to compensate. With TWRR, their percent returns will be identical. With XIRR they will be very different. TWRR separates out investing acumen from the happenstance timing of when you get your money to deposit, and when you retire, when you choose to take withdrawals. Something to think about, if you like. You might find this website interesting, too: http://www.dailyvest.com/", "title": "" }, { "docid": "3a43d36a7a6bba718cc624bbd36f4646", "text": "Here is an article that explains this: http://finance.ninemsn.com.au/pfproperty/investing/8123730/negative-gearing-explained. In essence, it is an investment set up to produce near-term losses for tax purposes by means of borrowing without positive cash flow. The investor hopes that despite operating at a loss, the property will appreciate in the long run (and long-term capital appreciation is typically taxed at a lower rate than current income).", "title": "" }, { "docid": "8a8840e91a8730a1816121a0b0d5bdfe", "text": "You cannot use continuous compounding for returns less than or equal to 100% because a natural logarithm can only be taken for a positive amount. This answer includes the accurate way to ascertain r, for which many people use an approximation. For example, using -20% monthly return for 12 months:- -0.2 -0.223144 0.0687195 Checking: 0.0687195 True Now trying -100% monthly return:- -1. Indeterminate Why? Because a natural logarithm can only be taken for a positive amount. So the latter calculation can not be done using (logarithmic) continuous compounding. Of course, the calculation can still be done using regular compounding. For -100% the results go to zero in the first month, but -150% produces a more interesting result: -1.5 -11920.9", "title": "" }, { "docid": "e161b90085865041d487f930bd6e12ce", "text": "If your question is truly just What is good growth? Is there a target return that's accepted as good? I assumed 8% (plus transaction fees). Then I'd have to point out that the S&P has offered a CAGR of 9.77% since 1900. You can buy an S&P ETF for .05%/yr expense. If your goal is to lag the S&P by 1.7%/yr over the long term, you can use a 85/15 mix of S&P and cash, sleep well at night, and avoid wasting any time picking stocks.", "title": "" }, { "docid": "6657c05898ceb7473983e062b054aa66", "text": "\"Thanks! Do you know how to calculate the coefficients from this part?: \"\"The difference between the one-year rate and the spread coefficients represents the response to a change in the one-year rate. As a result, the coefficient on the one-year rate and the difference in the coefficients on the one-year rate and spread should be positive if community banks, on average, are asset sensitive and negative if they are liability sensitive. The coefficient on the spread should be positive because an increase in long-term rates should increase net interest income for both asset-sensitive and liability-sensitive banks.\"\" The one-year treasury yield is 1.38% and the ten-year rate is 2.30%. I would greatly appreciate it if you have the time!\"", "title": "" }, { "docid": "cd51568044da756f3d4c0a41df77506d", "text": "\"Not to state the obvious, but whenever an investment is being made, the \"\"nuts and bolts\"\" is your return on investment. Analyzing the rate of return on an investment is the primary factor in any decision. Ideally, once the actual mechanics of investment and side \"\"benefits\"\" are factored out, the goal is to be able to analyze the pure financial return. Usually the biggest problem faced in analyzing various investments is comparing the Present Value of an investment to a series of payments that may be made or received in the future. When considering the purchase of a large equity, for example, you might be looking at what series of payments are required to purchase the asset. You can also reverse this and ask, \"\"What amount of money is equivalent to this series of payments?\"\" Ultimately, the Present Value of an Annuity is the way to make these comparisons equal. Fundamentally, the Present Value of an annuity is an amount of money that should, in theory, be equivalent to a series of payments. There is, for example, technically no difference between $1064.94 today and $100 a month for a year, at an interest rate of 1% per month. Grant you, most people would be happier with the money now, but that is what interest does - it compensates you for waiting on your money. You can fire up a spreadsheet and calculate the Present Value as long as you have the monthly payment, interest rate, and number of periods. Alternatively, you can calculate any one of those missing four variables - and the key is usually to understand what that rate would be in order to compare the investments. Finally, the taxable implication is really just an adjustment to the rate of return. Imagine the following three scenarios: (Obviously the rates are fictional - the goal is to show they are the same). Scenarios 1 & 2 are really just two sides of the same coin. Using the Future Value formula in Excel = FV(0.5%, 12, -100), you get $1233.56. In scenario 1, you would have $1233.56 in your bank account. In scenario 2, your bank would have $1233.56 from you, and you would have $100 less debt per month. They are equivalent transactions. Scenario 3 is really just a variation on scenario 2, localized to the United States. Because the interest is tax deductible, however, the rate of 6% isn't really accurate. Assuming you had a 25% tax bracket, you'd actually be getting back one quarter of your interest. Put another way, 7.5% mortgage interest costs you as much as 6% credit card debt. This is how you compare apples and organges - just turn everything into an annuity or a lump sum, using Present Value calculations. Finally, quick rule of thumb - if you owe taxes in both Canada and the US, your Canadian taxes are probably higher than your American ones. As such, any tax incentives will be concomitantly higher. If you only can only use Canadian tax incentives, then look to those incentives, other things being equal.\"", "title": "" }, { "docid": "ff5b7681a195c6b81bf7db7c0a563273", "text": "> According to pretty well accepted corporate finance principles. What are the names of those principles and where can I read more about them and how they apply to huge tech companies? I'd like more than your word on something as huge as you are claiming. That all my stocks are holding way too much cash and are run by finance morons.", "title": "" } ]	fiqa
95c77b8275d36794faf6145efc65ad2c	How do I buy bundled insurance policies?	[ { "docid": "a2f0b4e0345db20d3607499f4a1ebc64", "text": "You have 3 companies now that you work with. I would start there. Ask one of them to show you what would happen if you bought the other two policies from them. This may not be something that they will show via the quotes generated on the web page. So you would be better off talking to a person who can generate a quote with that additional information. Make sure that you are comparing exact matches for the limits and options for the policies. Once you have done that with the first then do the same for the other two. I would have to dig into my policy bills for life insurance, but I do know that the bills for the home and auto insurance do show exactly how much I am saving by having multiple polices.", "title": "" } ]	[ { "docid": "0d1e91dd9b70da76f6ad1b4bb1a86ab0", "text": "Personally I solve this by saving enough liquid capital (aka checking and savings) to cover pretty much everything for six months. But this is a bad habit. A better approach is to use budget tracking software to make virtual savings accounts and place payments every paycheck into them, in step with your budget. The biggest challenge you'll likely face is the initial implementation; if you're saving up for a semi-annual car insurance premium and you've got two months left, that's gonna make things difficult. In the best case scenario you already have a savings account, which you reapportion among your various lumpy expenses. This does mean you need to plan when it is you will actually buy that shiny new Macbook Pro, and stick to it for a number of months. Much more difficult than buying on credit. Especially since these retailers hate dealing in cash.", "title": "" }, { "docid": "aa1fd4c1ea9ab614af95103a1847a75c", "text": "Disclosure: I am working for an aggregation startup business called Brokerchooser, that is matching the needs of clients to the right online broker. FxPro and similar brokers are rather CFD/FX brokers. If you want to trade stocks you have to find a broker who is registered member of an exchange like LSE. Long list: http://www.londonstockexchange.com/exchange/traders-and-brokers/membership/member-firm-directory/member-firm-directory-search.html From the brokers we have tested at Brokerchooser.com I would suggest:", "title": "" }, { "docid": "2fad58094dff5fc338f65e7c6a7e0b9c", "text": "This depends on the jurisdiction, but such companies are typically subject to regulations (and audits) that require them to keep the customers' accumulated premiums very strictly separated from the company's own assets, liabilities and expenses. Additionally, they are typically only allowed to invest the capital in very safe things like government bonds. So, unless something truly catastrophic happens (like the US government defaulting on its bonds) or people in the company break the regulations (which would invovle all kinds of serious crimes and require complicity or complete failure of the auditors), your premiums and the contractual obligation to you would still be there, and would be absorbed by a different insurance company that takes over the defunct company's business. Realistically, what all this means is that insurance companies never go bankrupt; if they do badly, they are typically bought up by a competitor long before things get that bad.", "title": "" }, { "docid": "fa2988eabe7f775dbbabdcf23c5e69e3", "text": "\"Traditional insurance agent guy here. There is no right answer in my opinion because your individual needs cannot be generalized. There are a variety of factors that influence the price charged to you including but not limited to your past claims history, geographic location, credit profile, and the carrier's book of business itself. This is just a small sampling, in reality their pricing calculations may be far more complicated. The point is there is no one-size-fits all carrier. My agency works with 15 different carriers. Sometimes we can offer the best combination of coverage and cost to a prospective client that beats their existing coverage; other times we are nowhere close to being competitive. The most important thing you can do is find a person/site/company you can trust and one that does not take advantage of you. Insurance policies are complex and \"\"getting the best deal\"\" may oftentimes mean lessening coverage without realizing it. So I would recommend using whatever service channel (online, phone, local agent) that's most convenient and consultative for you. And otherwise, shop around once every year or two to make sure you're still getting the most for your money.\"", "title": "" }, { "docid": "5a8fb59d672228ef0294113ad9e05b3d", "text": "\"Insurance is bought for peace of mind and to divert disaster. Diverting disaster is a good/great thing. If your house burned down, if someone hit your car, or some other devastating event (think medical) happened that required a more allocation than you could afford the series of issues may snowball and cause you to lose a far greater amount of money than the initial incident. This could be in the form of losing work time, losing a job, having to buy transportation quickly paying a premium, having to incur high rate debt and so on. For the middle income and lower classes medical, house, and medical insurance certainly falls into these categories. Also why a lot of states have buyout options on auto insurance (some will let you drive without insurance by proving bonding up to 250K. Now the other insurance as I have alluded to is for peace of mind mainly. This is your laptop insurance, vacation insurance and so on. The premise of these insurances is that no matter what happens you can get back to \"\"even\"\" by paying just a little extra. However what other answers have failed to clarify is the idea of insurance. It is an agreement that you will pay a company money right now. And then if a certain set of events happen, you follow their guidelines, they are still in business, they still have the same protocols, and so on that you will get some benefit when something \"\"disadvantageous\"\" happens to you. We buy insurance because we think we can snap our fingers and life will be back to normal. For bigger things like medical, home, and auto there are more regulations but I could get 1000 comments on people getting screwed over by their insurance companies. For smaller things, almost all insurance is outsourced to a 3rd party not affiliated legally with a business. Therefore if the costs are too high they can simply go under, and if the costs are low they continue helping the consumer (that doesn't need help). So we buy insurance divert catastrophe or because we have fallen for the insurance sales pitch. And an easy way to get around the sales pitch - as the person selling you the insurance if you can have their name and info and they will be personally liable if the insurance company fails their end of the bargain.\"", "title": "" }, { "docid": "fc0e09fc1b6e0a85014e9fdbe99facf9", "text": "\"Short answer: Yes. Longer answer: There may or may not be a medical exam, or a physical, as with a life insurance policy. But your medical history is considered in the underwriting process. Disclosure: I once worked as a financial advisor, and held an insurance license for life, annuity and long-term care. It has been 8 years since I left that line of work. There are some \"\"knock-out\"\" questions that the salesperson is encouraged/required to ask just to see if there would be anything obvious that would disqualify you. The only one I can remember from that list is COPD. If you have that as a diagnosis in your personal medical history, the instruction to the salesperson is to not waste anybody's time. There were several other conditions, all with very long technical names. If you're not disqualified by the no-brainer knock-out questions, your medical history will likely be included in the underwriting process. Not every serious illness is an automatic disqualifier, including cancer. It may cause your premiums to be a little higher, as the underwriters will take a closer look and increase your risk profile due to the history. There may be some group policies where underwriting is limited or not required at all. As with all group insurance policies, the healthy members in the group are paying more in premiums than they otherwise would, in order to \"\"subsidize\"\" the premiums of the less healthy members. It's almost always cheaper to get your own personal policy unless you know you wouldn't qualify for it. Then, the group policy might be your only chance for some coverage. Age 60-62 is statistically the best time to purchase LTCI. On average, if you make it to 62, you have a very high chance of making it to 90. (These were the numbers available to me 8 years ago when I was in the business.) After 62, the prices go up a lot faster with each year of age. I can't answer with anything helpful about your spouse's specific situation. It would be good to talk to a licensed insurance broker about it (not a salesman from a specific company). The broker is not necessarily bound to disclose personal details you might have shared with them. The company salesman would be obligated to disclose it to their company.\"", "title": "" }, { "docid": "cd9b76c3ca143af260f9aa3290c8779a", "text": "\"These policies are usually called dread disease policies or critical illness insurance, and they normally aren't a good deal. Furthermore, with the passage of the Affordable Care Act, such policies may become less common or disappear entirely. These policies aren't a great deal because of the effects of adverse selection and asymmetric information, two closely related concepts in the economics of insurance. When you purchase an insurance policy, the insurance company charges you a premium based on your average risk level or the average risk level of your risk pool, e.g. you and your fellow employees, if you get insurance through your employer. For health insurance, this average risk level is the average probability that you'll incur healthcare costs. The insurer's actuaries calculate this probability from numerous factors, like your age, sex, current health, socioeconomic status, etc. Asymmetric information exists when you know more about this probability than the insurance company does. For example, you may look like a relatively low-risk individual on paper, but little does the insurance company know, BASE jumping is one of your hobbies. Because you know about your hobby and the insurance company doesn't, you secretly know that your risk of incurring healthcare expenses is much higher than the insurance company expects. If the insurance company knew this, they would like to charge you a much higher premium, if they could. However, they can't, because a) they don't know about your hobby, and b) the premium may be decided for the entire group/risk pool, so they can't increase it simply because a few individuals in the group have higher risk levels. Adverse selection occurs when individuals with higher risk levels are more likely to buy insurance. You may decide that because of your dangerous hobby, you do want to take advantage of your employer's healthcare plan. Unfortunately for the insurance company, they can't adjust their price accordingly. Adverse selection is a major factor in insurance markets, so I didn't go into much detail here (too much detail is probably off-topic anyway). I can point you towards more resources on the topic if you're interested. However, the situation is different when you purchase a dread disease policy. By expressing interest in such a specific policy, e.g. a cancer insurance policy, you signal to the insurance company that you feel you have a higher risk of facing that disease. In your case, you're signaling to the insurance company that your family probably has a history of cancer or that you have habits that make you more susceptible to it, and your premiums will be higher to compensate the insurance company for bearing this additional risk. Since the insurance company already has a rough estimate of your chances of developing that illness, they may already know that you have a higher chance of facing it. However, when you express interest in a disease-specific policy, this signals the existence of asymmetric information (your family history or other habits), and the insurer assumes you know something they don't that elevates your risk level of that specific disease. Since these policies are optional policies often sold as riders to existing policies, the insurance company has more flexibility in pricing them. They can charge you a higher premium because you've signaled to the insurer that you have a significantly above-average risk of contracting a specific disease. Also, the insurer can do a much better job of estimating the expected costs of insuring you since they need only focus on data surrounding one disease. The policy will be priced accordingly, i.e. in such a way that isn't necessarily beneficial to you. Furthermore, most dread disease policies aren't guaranteed renewable, which means that even if you are willing to keep paying the premiums, the insurance company doesn't have to keep insuring you. As your risk of developing the specific disease grows, e.g. with age, it may pass the point where insuring you is no longer an acceptable risk. The company expects you to develop the illness with the next few renewal cycles, so they decide not to renew your policy. The end result? The insurance company has the premiums you've paid previously, but you no longer have coverage for that illness, and ex post, you've suffered a net loss with no reduction of risk for the foreseeable future. Dread disease policies are changing under the Affordable Care Act. According to healthcare.gov Starting in 2014, ... all new health insurance plans sold to individuals and small businesses, and plans purchased in the new Affordable Insurance Exchanges, must include a range of essential health benefits. The essential health benefits include quite a few areas of coverage; since this applies to policies offered on the state insurance exchanges and those offered outside of it, dread disease policies wouldn't seem to qualify. For more information, you can read the linked page on healthcare.gov or see Section 1302, subsection b), titled \"\"Essential Health Benefits Requirements\"\" in the law itself (p87). I imagine more details will be available on a state-by-state basis through 2014 and into 2015. One legal source (see the discussion on p24) states that: whatever else the ACA does with excepted benefit policies, including specific disease and fixed dollar indemnity policies, it does explicitly provide that such policies do not count as minimum essential coverage for purposes of the ACA This seems pretty straightforward; a dread disease (or \"\"specific disease\"\" policy, as it's referred to in the article), won't count towards the minimum essential requirements. This may not be an issue for you, but for others, it's important to understand that you'll still need to pay the penalty if you only purchase one of these policies. The ACA spells this out in Section 5000(f) (see p316, which states that \"\"excepted benefit policies\"\" are excluded and defines them using the definition in the Public Health Service Act (PHSA). *The PSHA specifically includes \"\"Coverage only for a specified disease or illness\"\" in their definition of \"\"excepted benefit policies\"\" (see section 2791(b), paragraph 3A on p82, so it's probably a safe bet that such policies won't count towards the minimum. Also, as Rick pointed out in the comments, the Affordable Care Act also forbids lifetime limits on most insurance plans, so assuming you find an insurance policy with adequate coverage for the specific disease you're worried about, such a plan should cover the related expenses without a lifetime limit. Deductibles, annual limits, and other factors may complicate this somewhat. In the section about lifetime limits (Sec. 2711, p2), the Affordable Care Act states that: A group health plan and a health insurance issuer offering group or individual health insurance coverage may not establish ... lifetime limits on the dollar value of benefits for any participant or beneficiary. However, the law states in the next paragraph that the preceding statement should not be construed to prevent a group health plan or health insurance coverage from placing annual or lifetime per beneficiary limits on specific covered benefits that are not essential health benefits under section 1302(b) of the Patient Protection and Affordable Care Act, to the extent that such limits are otherwise permitted under Federal or State law The section also contains similarly vague caveats about annual limits, so the actual details and limits may vary once individual states finalize their policies. The law is intentionally vague because the vast majority of the law's implementation is left up to individual states. Furthermore, certain parts of the law specify actions involving the Secretary of Health and Human Services, so these may require further codification in the future too. You should still read the fine print of any insurance policy you buy and evaluate it as you would any contract (see the next section). Since a dread disease policy probably isn't a good idea, you'll probably want to evaluate the healthcare plans offered by your employer or individual plans offered in your area (if your employer doesn't offer coverage). I've tried to include the basic points offered in these articles to give you or future visitors some idea of where to start. These points may change once the Affordable Care Act is implemented, so I'll try to keep them as general as possible. Services - Above and beyond the minimum essential requirements, what services does the plan offer? Are these services a good match for you and/or your family, or do they add unnecessary cost to the premium with little or no benefit? For example, my health insurance plan offers basic dental coverage with a small co-pay, so I don't need a separate dental plan, even though my employer offers one. Choice - What doctors, clinics, hospitals, etc. are preferred providers under your plan? Do you need a referral from your primary care doctor to see a specialist, or can you find one on your own? Are the preferred providers convenient for you? In my first year of college (about five years ago), my student health insurance only covered a few hospitals that were in the suburbs and somewhat difficult for me to reach. This is something to keep in mind, depending on where you live. Costs - This is a major one, obviously. Deductibles, copays, maximum cost limits over a year or your lifetime, out-of-network costs, etc. are all variables to consider. There are other factors, but since I don't have a family, other members of the site can provide more detailed information about what to look for in family policies. In place of a dread disease policy, you're likely better off purchasing a comprehensive health insurance policy, perhaps a catastrophic coverage policy with a high deductible that will kick in once you've exhausted your standard insurance policy. However, this may be a moot point since the passage of the Affordable Care Act may significantly reduce the availability of such policies anyway.\"", "title": "" }, { "docid": "418e72db8fd3fcb8b6ea9c7cd9579030", "text": "\"This is going to vary from insurer to insurer, and likely year to year. Typically an insurer will set what it calls the guaranteed rate of return for whole life policies and will allow you to take loans against the cash value of your policy at some adjustment to that rate. Also typically you pay the interest back to yourself less some small administrative fee. Some insurers have whole life policies called something along the lines of an \"\"accelerated cash value\"\" policy or a \"\"high early cash value\"\" policy, stick to these ones. The commission structure is less favorable to the agent/broker but much more of your premium is recognized as cash value earlier. The benefit (for lack of a better word) to taking a loan against your own cash value over taking a loan from a bank is the severely reduced process. There's no underwriting for your loan like there would be from a bank. If you're laid off maybe you can't get a loan from a bank but you can scoop some money out of your policy on a loan basis or alternatively you can just surrender the policy and take the accrued cash value. Many people will poo-poo the value of whole life, but fact of the matter is your underwriting status can change in the course of your life and it's possible that in the future you won't be able to buy any life insurance. There's nothing wrong with having something permanent to supplement your larger term policies. Personally, I view diversification as having money in a lot of different places. This strategy is probably not as efficient as it could, but I don't like the idea of having all my eggs in one basket. I have cash in a lock box at home, cash savings, CDs, a personal loan portfolio, bitcoins, index funds, individual stocks, commodity etfs, and bond funds spread in traditional 401(k), ROTH IRA and regular taxable accounts spread out to 6 different institutions. I don't personally own any whole life, but I'll probably buy a small policy before my next 6-month birthday; I might as well put some money there too. All of this is to say, do not put all of your money in a whole life policy, and do not buy all of your life insurance needs via whole life.\"", "title": "" }, { "docid": "c730a794b925cb372bb786761aaee5ff", "text": "There is such a thing as a buy-write, which is buying a stock and writing a (covered) call simultaneously. But as far as I know brokers charge two commissions, one stock trade and one options trade so you're not going to save on commissions.", "title": "" }, { "docid": "a7d82cccee4da724a6800ad82c18e73c", "text": "For example, it is not allowed to buy flood insurance at peak flood season and then cancel it when it is over. They are not offering this right now. So it would be interesting to see if they offer this and how they offer this. For example, you can insure your camera for a week when you are going on vacation. They call it on-demand insurance. They segment Trov is targeting consumer electronics. More often people don't take insurance in this segment as the insurance cost is high and benefits low. However if going on vacation, most are afraid of loosing / damaging equipments. Generally although we are afraid, most often nothing happens. It is this segment; you make the insurance cheap and easy to buy and create a new segment. Insurance fraud detection is an important part of insurance process such that insurance companies allocate a lot of resources to detect improper insurance claims. The website does not mention how they process claims. Although it looks easy, they may have a more stringent process. For example what is stopping me from buying an insurance after event; i.e. break my phone Monday, buy insurance on Monday and make a claim on Tuesday saying the phone broke on Tuesday.", "title": "" }, { "docid": "fceae85b48ddff092e9d08092eecabbd", "text": "You need to see that prospectus. I just met with some potential new clients today that wanted me to take a look at their investments. Turns out they had two separate annuities. One was a variable annuity with Allianz. The other was with some company named Midland Insurance (can't remember the whole name). Turns out the Allianz VA has a 10 year surrender contract and the Midland has a 14 year contract. 14 years!!! They are currently in year 7 and if they need any money (I'm hoping they at least have a 10% free withdrawal) they will pay 6% surrender on the Allianz and a 15% surrender on the other. Ironically enough, they guy who sold this to them is now in jail. No joke.", "title": "" }, { "docid": "b97679e455babf6f40d25eba1bd3ad0c", "text": "The issuer of the service contract is making money. DO NOT buy these contracts. Self insure over your life time 40/60 years and you will save money.", "title": "" }, { "docid": "1370c5e19e8cb80afba418a4da199a96", "text": "Not to pick your words apart, but I'm used to the word laddering as used with CDs or bonds, where one buys a new say, 7 year duration each year with old money coming due and, in effect, is always earning the longer term rate, while still having new funds available each year. So. The article you link suggests that there's money to be saved by not taking a long term policy on all the insurance you buy. They split $250K 30 year / $1M 20 year. The money saved by going short on the bigger policy is (they say) $11K. It's an interesting idea. Will you use the $11K saved to buy a new $1M 10 year policy in 20 years, or will you not need the insurance? There are situations where insurance needs drop, e.g. 20 years into my marriage, college fully funded as are retirement accounts. I am semi-retired and if I passed, there's enough money. There are also situations where the need runs longer. The concept in the article works for the former type of circumstance.", "title": "" }, { "docid": "ccd605b3bc6a3e996150716450fc9cee", "text": "\"(Note: out of my depth here, but in case this helps...) While not a direct answer to your question, I'll point out that in the inverse situation - a U.S. investor who wants to buy individual stocks of companies headquartered outside US - you would buy ADRs, which are $-denominated \"\"wrapper\"\" stocks. They can be listed with one or multiple brokerages. One alternative I'd offer the person in my example would be, \"\"Are you really sure you want to directly buy individual stocks?\"\" One less targeted approach available in the US is to buy ETFs targeted for a given country (or region). Maybe there's something similar there in Asia that would eliminate the (somewhat) higher fees associated with trading foreign stocks.\"", "title": "" }, { "docid": "e7949ba4d3c415a4fd358bc2b44ce02d", "text": "I've had many home loans, and all have been sold to a big bank. They have certain rules about how much insurance you need to have, but I've never had one buy insurance on my behalf - they always send letters telling me I need to increase the insurance. They do say that if I don't get enough insurance, they will do it for me, but this has never been necessary.", "title": "" } ]	fiqa
4d41c81d0f6503ce1529c0485afb7ebe	Strategy to pay off car loan before selling the car	[ { "docid": "92a61455d9f49c80b5be72ef8cd10f71", "text": "As far as ease of sale transaction goes you'll want to pay off the loan and have the title in your name and in your hand at the time of sale. Selling a car private party is difficult enough, the last thing you want is some administrivia clouding your deal. How you go about paying the remaining balance on the car is really up to you. If you can make that happen on a CC without paying an additional fee, that sounds like a good option.", "title": "" } ]	[ { "docid": "4e5fd662a672e4645120d38ef17e20f9", "text": "The main benefit of paying off the loan early is that it's not on your mind, you don't have to worry about missing a payment and incurring the full interest due at that point. Your loan may not be set up that way, but most 0% interest loans are set up so that there is interest that's accruing, but you don't pay it so long as all your payments are on time, oftentimes they're structured so that one late payment causes all of that deferred interest to be due. If you put the money in the bank you'd make a small amount of interest and also not have to worry about funds availability for your car payment. If you use the money for some other purpose, you're at greater risk of something going wrong in the next 21 months that causes you to miss a payment and being hit with a lot of interest (if applicable to your loan). If you already have an emergency fund (at least 3-6 months of expenses) then I would pay the loan off now so you don't have to think about it. If you don't have an emergency fund, then I'd bank the money and keep making payments, and pay it off entirely when you have funds in excess of your emergency fund to do so.", "title": "" }, { "docid": "8d8e2e72905068e2d95e805edefdab87", "text": "\"Having just gone through selling a car, I can tell you that CarMax will most likely not be the best solution. I recently sold my '09 Pontiac Vibe which had a KBB and Edmonds value (private party sale) of around $6k. Trade-in value was around $4,800. I took it to the local CarMax for a quote, and they came back with $3,500. Refinancing is tricky. Banks have a set limit on how old a car they will finance. Many won't even offer financing if the vehicle has over 100k miles. We looked at refinancing our other car, and even getting the APR down over a point we would only have saved $15/mo or so. Banks typically offer much higher interest rates for used non-dealership cars and refinancing than they do for new cars, or even used cars purchased from a dealership. Assuming you have 2-3 years left on your loan, I don't think that refinancing would save you enough to be worth considering. CarMax sells cars in 1 of 2 ways. They are also up front with you about the process. They do not reference KBB or Edmonds or any other valuation tool other than their own internal system. They either take the car, spruce it up a bit, then resell it on their lot, or they sell it at auction. If they determine your car will be sold at auction, then they will offer you a rock bottom price. The determining factors that come into play include age of the car, mileage, and of course overall condition. If you Mini is still in good shape and doesn't have a lot of miles, then they may try to resell it on their lot, for which they could offer you closer to personal-sale price than trade-in. How many 2007's are for sale in your area? How much are they selling for? I did sell them a truck back in 2005 and received $200 more than KBB valued it for, but it was in great shape, only a couple of years old, relatively low mileage, and it was in high demand. God bless the South and their love for trucks! I ended up selling my Pontiac to another local car dealership. They offered me $5,300 (after negotiating, leaving the dealership, then negotiating more over the phone). It took me a day and a half and really very little effort. I have several friends that have gone through the same thing with selling cars, and all have had similar luck going to other dealerships, where prices can be negotiated, rather than CarMax. CarMax has no incentive to \"\"settle\"\" or forgive your loan. If you really want to pay it off, save up what you believe the difference will be, then shop your car around the local dealerships and get prices for your Mini. Remember that dealers have to turn a profit, so be reasonable with your negotiation. If you can find comparable vehicles in your area listed for $X,000 then knock $1,500 off that price and tell the dealerships that's what you want.\"", "title": "" }, { "docid": "238c47763010d660a605d51c8190b59a", "text": "Assuming that partial payments are held (without interest) until enough money has accumulated to make at least a full payment, and assuming that overpayments are applied toward principal, a strategy of making three $ 96.00 payments per month will shorten your amortization period by less than one month. These calculations assume that the interest rate is 12.5 percent APR, compounded monthly (with an APY of 13.2416 percent). Instead of 71 payments of $ 285.56 plus a final payment of $ 285.38, you would make the equivalent of 71 payments of $ 288.00 plus a final payment of $ 28.10. If you make one $ 96.00 payment every ten days, you will make an average of 36.5… partial payments per year, instead of 36 partial payments per year. This will speed up your loan amortization by about another month-and-a-half over the course of the 72 month loan. One month of shortening is due to the extra principal payments, and the other half-month is due to interest savings. To a second approximation, this strategy is similar to paying $ 292.00 per month for 69 months plus a final payment of $ 195.38. In other words, this strategy will probably involve about 212 payments of $ 96.00 each, possibly with a small 213th payment.", "title": "" }, { "docid": "fe53fc578ef231eb4f000c990378512f", "text": "You have a good start (estimated max amount you will pay, estimated max down payment, and term) Now go to your bank/credit union and apply for the loan. Get a commitment. They will give you a letter, you may have to ask for it. The letter will say the maximum amount you can pay for the car. This max includes their money and your down payment. The dealer doesn't have to know how much is loan. You also know from the loan commitment exactly how much your monthly payment will be in the worst case. If you have a car you want to trade in, get an written estimate that is good for a week or so. This lets you know how much you can get from selling the car. Now visit the dealer and tell them you don't need a loan, and won't be trading in a car. Don't show them the letter. After all the details of the purchase are concluded, including any rebates and specials, then bring up financing and trade-in. If they can't beat the deal from your bank and the written estimate for the car you are selling, then the deal is done. Now show them the letter and discuss how much down they need today. Then go to the bank for the rest of the money. If they do have a better loan deal or trade in then go with the dealer offer, and keep the letter in your pocket. If you go to the dealer first they will confuse you because they will see the price, interest rate, length of loan, and trade in as one big ball of mud. They will pick the settings that make you happy enough, yet still make them the most money.", "title": "" }, { "docid": "3b18376c746ec672517b49eeb64ac570", "text": "\"It's not a bad strategy. I'd rather owe money at 4% interest than at 6-7%. However, there is something to consider. Consolidating debt into a new loan can backfire. When you have money borrowed at 7%, you want to get that paid off as quickly as possible. Once you have that converted to 4%, if you think, \"\"Now I can take my time paying off this debt,\"\" then you aren't really better off. In fact, if you take too long paying off the new loan, you might end up paying more interest than if you had kept the high interest loan and paid it as soon as possible. Don't lose your drive to get out of debt after you refinance. As far as how the student loans affect your debt-to-income ratio, I'm not sure; however, if they do count (I think they do), your ratio will not really be going up by taking out the new loan, since you are using the money to pay other debt. Make sure the new lender knows this, so they take that into consideration when making their decision. Overall, I like your strategy: pay off what you can right away (the car loan and the highest interest student loans) and reduce the interest on the rest. Just make sure that you continue to pay down that debt as quick as you can.\"", "title": "" }, { "docid": "1fcdc5d9cd3b7f6107c1f75848119357", "text": "\"There's two scenarios: the loan accrues interest on the remaining balance, or the total interest was computed ahead of time and your payments were averaged over x years so your payments are always the same. The second scenarios is better for the bank, so guess what you probably have... In the first scenario, I would pay it off to avoid paying interest. (Unless there is a compelling reason to keep the cash available for something else, and you don't mind paying interest) In the second case, you're going to pay \"\"interest over x years\"\" as computed when you bought the car no matter how quickly you pay it off, so take your time. (If you pay it earlier, it's like paying interest that would not have actually accrued, since you're paying it off faster than necessary) If you pay it off, I'm not sure if it would \"\"close\"\" the account, your credit history might show the account as being paid, which is a good thing.\"", "title": "" }, { "docid": "18d2a4d236f1778fbd6a809e214fd3c8", "text": "I don't disagree with the current answers, but I feel like no one really answered your question directly. Seems to me like what you were asking is when to trade in your car in relation to when/whether your loan is paid off? Assuming you are committed to trading your car in (and not selling it privately as has been suggested), whether the car is paid off should have no impact on what you get for a trade-in. The car is worth what it's worth, and what you owe on it should not affect the transaction.", "title": "" }, { "docid": "78b784464b371298238b7268183212f8", "text": "Do you need the car? It depends on what your goals are. You're going to keep losing money on the car via means of the debt (which I assume you can't pay off without selling the car) and depreciation. If it was me, I would sell the car. But if you like it and you can afford it, then keep it.", "title": "" }, { "docid": "12bb7a7f585f4dd6444a5401f52d0b89", "text": "If the car loan has 0% interest for 5 years, then paying off the student loan is cheaper. No matter when you pay off the car, you will pay the exact same amount (as long as its within 5 years). You could spend $20,000 right now to pay off the car loan or slowly spend $20,000 over the next 5 years. The gross amount paid for the car loan does not change. On the contrary, the longer you wait to pay off the student loans, the more you will end up paying for them. So why not get the student loans out of the way before they rack up more interest and pay the car loan over time? Update: I forgot to add, as Ben Miller said, congratulations on paying off the $40,000!", "title": "" }, { "docid": "dc69d3f6e641e3921c55c1180b6158e7", "text": "\"Following up on @petebelford's answer: If you can find a less expensive loan, you can refinance the car and reduce the total interest you pay that way. Or, if your loan permits it (not all do; talk to the bank which holds the loan and,/or read the paperwork you didn't look at), you may be able to make additional payments to reduce the principal of the loan, which will reduce the amount and duration of the loan and could significantly reduce the total interest paid ... at the cost of requiring you pay more each month, or pay an additional sum up front. Returning the car is not an option. A new car loses a large portion of its value the moment you drive it off the dealer's lot and it ceases to be a \"\"new\"\" car. You can't return it. You can sell it as a recent model used car, but you will lose money on the deal so even if you use that to pay down the loan you will still owe the bank money. Given the pain involved that way, you might as well keep the car and just try to refinance or pay it off. Next time, read and understand all the paperwork before signing. (If you had decided this was a mistake within 3 days of buying, you might have been able to take advantage of \"\"cooling down period\"\" laws to cancel the contract, if such laws exist in your area. A month later is much too late.)\"", "title": "" }, { "docid": "e3a794578c9ef2130d3f3bb40b9b97aa", "text": "Everybody on the car title will need to participate in the selling process. The person who is buying the car will need everybody to sign the paperwork so that nobody months later tries to say they never agreed to sell the car. The money will have to be sent to the lender to pay off the rest of the loan. If the money isn't enough to pay off the loan everybody will have to decide how the extra money will be sent to the lender. This will have to be done as part of the selling process because the lender doesn't want you to sell the car and keep the cash. Once the car is gone so is the collateral and they can't take it back if you miss payments. If the cousin is too far away to participate in the selling of the car, you may need the buyer and the lender to tell you how to proceeded. If you are selling at a dealership they will know what documents and signatures will be needed, the bank will also know what to do. If the loan is almost paid off it may be easier to pay the loan first, and then get the title without the lenders name before trying to sell it.", "title": "" }, { "docid": "29c366b66bc9ac78b881ee6be8d430e3", "text": "That interest rate (13%) is steep, and the balloon payment will have him paying more interest longer. Investing the difference is a risky proposition because past performance of an investment is no guarantee of future performance. Is taking that risk worth netting 2%? Not for me, but you must answer that last question for yourself. To your edit: How disruptive would losing the car and/or getting negative marks on your credit be? If you can quantify that in dollars then you have your answer.", "title": "" }, { "docid": "927daf0565187ad69e532a058862b42f", "text": "The optimal down payment is 0% IF your interest rate is also 0%. As the interest rate increases, so does the likelihood of the better option being to pay for the car outright. Note that this is probably a binary choice. In other words, depending on the rate you will pay, you should either put 0% down, or 100% down. The interesting question is what formula should you use to determine which way to go? Obviously if you can invest at a higher return than the rate you pay on the car, you would still want to put 0% down. The same goes for inflation, and you can add these two numbers together. For example, if you estimate 2% inflation plus 1% guaranteed investment, then as long as the rate on your car is less than 3%, you would want to minimize the amount you put down. The key here is you must actually invest it. Other possible reasons to minimize the down payment would be if you have other loans with higher rates- then obviously use that money to pay down those loans before the car loan. All that being said, some dealers will give you cash back if you pay for the car outright. If you have this option, do the math and see where it lands. Most likely taking the cash back is going to be more attractive so you don't even have to hedge inflation at all. Tip: Make sure to negotiate the price of the car before you tell them how you are going to pay for it. (And during this process you can hint that you'll pay cash for it.)", "title": "" }, { "docid": "d39986d50b0e63031806e14e0e0c04a4", "text": "\"Wow, you guys get really cheap finance. here a mortage is 5.5 - 9% and car loans about 15 - 20%. Anyway back to the question. The rule is reduce the largest interest rate first (\"\"the most expensive money\"\"). For 0% loans, you should try to never pay it off, it's literally \"\"free money\"\" so just pay only the absolute minimum on 0% loans. Pass it to your estate, and try to get your kids to do the same. In fact if you have 11,000 and a $20,000 @ 0% loan and you have the option, you're better to put the 11,000 into a safe investment system that returns > 0% and just use the interest to pay off the $20k. The method of paying off the numerically smallest debt first, called \"\"snowballing\"\", is generally aimed at the general public, and for when you can't make much progress wekk to week. Thus it is best to get the lowest hanging fruit that shows progress, than to try and have years worth of hard discipline just to make a tiny progress. It's called snowballing, because after paying off that first debt, you keep your lifestyle the same and put the freed up money on as extra payments to the next target. Generally this is only worth while if (1) you have poor discipline, (2) the interest gap isn't too disparate (eg 5% and 25%, it is far better to pay off the 25%, (3) you don't go out and immediately renew the lower debt. Also as mentioned, snowballing is aimed at small regular payments. You can do it with a lump sum, but honestly for a lump sum you can get better return taking it off the most expensive interest rate first (as the discipline issue doesn't apply). Another consideration is put it off the most renewable finance. Paying off your car... so your car's paid off. If you have an emergency, redrawing on that asset means a new loan. But if you put it off the house (conditional on interest rates not being to dissimilar) it means you can often redraw some or all of the money if you have an emergency. This can often be better than paying down the car, and then having to pay application fees to get a new unsecured loan. Many modern banks actually use \"\"mortgage offsetting\"\" which allows them to do this - you can keep your lump sum in a standard (or even fixed term) and the value of it is deducted \"\"as if\"\" you'd paid it off your mortgage. So you get the benefit without the commitment. The bank is contracted for the length of the mortgage to a third party financier, so they really don't want you to change your end of the arrangement. And there is the hope you might spend it to ;) giving them a few more dollars. But this can be very helpful arragement, especially if you're financing stuff, because it keeps the mortgage costs down, but makes you look liquid for your investment borrowing.\"", "title": "" }, { "docid": "1c42f580bbe721965a6f98e30226dc44", "text": "The other answers have offered some great advice, but here is an alternative that hasn't been mentioned yet. I'm assuming that you have an adequately-sized emergency fund in savings, and that your cars are your only non-mortgage debt. Since you still have car debt, you probably don't have anything saved for buying a new car when your current cars are at the end-of-life. Consider paying off your car loans early, then begin saving for your next car. Having cash in the bank for a car is very freeing, and it changes your mindset when it comes time to purchase a car, as it is easy to waste a lot of money on something that depreciates rapidly when you aren't paying for it immediately. This approach might be counterintuitive if your car loan interest rate is less than your mortgage rate, but you will probably need another car before you need another house, and paying cash for a car is worth doing.", "title": "" } ]	fiqa
8878422356e95cdcd9da25a100514fc3	Stock trading models that use fundamental analysis, e.g. PEG ratios?	[ { "docid": "59cb85ca6365148f787ab8d328ae0bd3", "text": "\"One idea: If you came up with a model to calculate a \"\"fair price range\"\" for a stock, then any time the market price were to go below the range it could be a buy signal, and above the range it could be a sell signal. There are many ways to do stock valuation using fundamental analysis tools and ratios: dividend discount model, PEG, etc. See Wikipedia - Stock valuation. And while many of the inputs to such a \"\"fair price range\"\" calculation might only change once per quarter, market prices and peer/sector statistics move more frequently or at different times and could generate signals to buy/sell the stock even if its own inputs to the calculation remain static over the period. For multinationals that have a lot of assets and income denominated in other currencies, foreign exchange rates provide another set of interesting inputs. I also think it's important to recognize that with fundamental analysis, there will be extended periods when there are no buy signals for a stock, because the stocks of many popular, profitable companies never go \"\"on sale\"\", except perhaps during a panic. Moreover, during a bull market and especially during a bubble, there may be very few stocks worth buying. Fundamental analysis is designed to prevent one from overpaying for a stock, so even if there is interesting volume and price movement for the stock, there should still be no signal if that action happens well beyond the stock's fair price. (Otherwise, it isn't fundamental analysis — it's technical analysis.) Whereas technical analysis can, by definition, generate far more signals because it largely ignores the fundamentals, which can make even an overvalued stock's movement interesting enough to generate signals.\"", "title": "" }, { "docid": "c28eb69add00010b45511f54bf8ebe0e", "text": "\"Maria, there are a few questions I think you must consider when considering this problem. Do fundamental or technical strategies provide meaningful information? Are the signals they produce actionable? In my experience, and many quantitative traders will probably say similar things, technical analysis is unlikely to provide anything meaningful. Of course you may find phenomena when looking back on data and a particular indicator, but this is often after the fact. One cannot action-ably trade these observations. On the other hand, it does seem that fundamentals can play a crucial role in the overall (typically long run) dynamics of stock movement. Here are two examples, Technical: suppose we follow stock X and buy every time the price crosses above the 30 day moving average. There is one obvious issue with this strategy - why does this signal have significance? If the method is designed arbitrarily then the answer is that it does not have significance. Moreover, much of the research supports that stocks move close to a geometric brownian motion with jumps. This supports the implication that the system is meaningless - if the probability of up or down is always close to 50/50 then why would an average based on the price be predictive? Fundamental: Suppose we buy stocks with the best P/E ratios (defined by some cutoff). This makes sense from a logical perspective and may have some long run merit. However, there is always a chance that an internal blowup or some macro event creates a large loss. A blended approach: for sake of balance perhaps we consider fundamentals as a good long-term indication of growth (what quants might call drift). We then restrict ourselves to equities in a particular index - say the S&P500. We compare the growth of these stocks vs. their P/E ratios and possibly do some regression. A natural strategy would be to sell those which have exceeded the expected return given the P/E ratio and buy those which have underperformed. Since all equities we are considering are in the same index, they are most likely somewhat correlated (especially when traded in baskets). If we sell 10 equities that are deemed \"\"too high\"\" and buy 10 which are \"\"too low\"\" we will be taking a neutral position and betting on convergence of the spread to the market average growth. We have this constructed a hedged position using a fundamental metric (and some helpful statistics). This method can be categorized as a type of index arbitrage and is done (roughly) in a similar fashion. If you dig through some data (yahoo finance is great) over the past 5 years on just the S&P500 I'm sure you'll find plenty of signals (and perhaps profitable if you calibrate with specific numbers). Sorry for the long and rambling style but I wanted to hit a few key points and show a clever methods of using fundamentals.\"", "title": "" } ]	[ { "docid": "31aee2d34d62c45dbe1bd0439bd542b1", "text": "\"A couple options that I know of: Interactive Brokers offers a \"\"paper trading\"\" mode to its account holders that allows you to start with a pretend stack of money and place simulated trades to test trading ideas. They also provide an API that allows you to interface with their platform programmatically for retrieving quotes, placing orders, and the such. As you noted, however, it's not free; you must hold a funded brokerage account in order to qualify for access to their platform. In order to maintain an account, there are minimums for required equity and monthly activity (measured in dollars that you spend on commissions), so you won't get access to their platform without having a decent amount of skin in the game. IB's native API is Java-based; IbPy is an unofficial wrapper that makes the interface available in Python. I've not used IB at all myself, but I've heard good things about their API and its accessibility via IbPy. Edit: IB now supports Python natively via their published API, so using IbPy is no longer needed, unless you wish to use Python 2.x. The officially supported API is based on Python 3. TD Ameritrade also offers an API that is usable by its brokerage clients. They do not offer any such \"\"paper trading\"\" mode, so you would need to \"\"execute\"\" transactions based on quotes at the corresponding trade times and then keep track of your simulated account history yourself. The API supports quote retrieval, price history, and trade execution, among other functions. TDA might be more attractive than IB if you're looking for a low-cost link into market data, as I believe their minimum-equity levels are lower. To get access, you'll need to sign up for an API developer account, which I believe requires an NDA. I don't believe there is an official Python implementation of the API, but if you're a capable Python writer, you shouldn't have trouble hooking up to the published interfaces. Some caveats: as when doing any strategy backtesting, you'll want to be sure to be pessimistic when doing so, so your optimism doesn't make your trades look more successful than they would be in the real world. At a minimum, you'll want to ensure that your simulations transact at the posted bid/ask prices, not necessarily the last trade's price, as well as any commissions and fees associated with the trade. A more robust scheme would also take into account the depth of the order book (also known as level 2 quotes), which can cause additional slippage in the prices at which you buy/sell your security. An even more robust scheme would take into account the potential latency of trade execution, looking at all prices over some time period that covers the maximum expected latency and simulating the trade at the worst-possible price.\"", "title": "" }, { "docid": "ce4221079abce3405a8b34b151d4a4d5", "text": "The Sharpe ratio is, perhaps, the method you are looking for. That said, not really sure beta is a meaningful metric, as there are plenty of safe bets to be made on volatile stocks (and, conversely, unsafe bets to be made on non-volatile ones).", "title": "" }, { "docid": "7ad7c351cacf62d86d12f2a96d703e40", "text": "Just got back from the office, so I can better answer it now. The trader uses the Metatrader platform, which is programmed with a language based off C++. I'm working with him to update some algos now. His strategies running on ToS are more or less proof-of-concept that he streams right now as he sources investors.", "title": "" }, { "docid": "86f7fb8aee91031e8893956bc83201aa", "text": "Are you implying that Amazon is a better investment than GE because Amazon's P/E is 175 while GE's is only 27? Or that GE is a better investment than Apple because Apple's P/E is just 13. There are a lot of other ratios to consider than P/E. I personally view high P/E numbers as a red flag. One way to think of a P/E ratio is the number of years it's expected for the company to earn its market cap. (Share price divided by annual earnings per share) It will take Amazon 175 years to earn $353 billion. If I was going to buy a dry cleaners, I would not pay the owner 175 years of earnings to take control of it, I'd never see my investment back. To your point. There is so much future growth seemingly built in to today's stock market that even when a company posts higher than expected earnings, the company's stock may take a hit because maybe future prospects are a little less bright than everyone thought yesterday. The point of fundamental analysis is that you want to look at a company's management style and financial strategies. How is it paying its debt? How is it accumulating the debt? How is it's return on assets? How is the return on assets trending? This way when you look at a few companies in the same market segment you may have a better shot at picking the winner over time. The company that piles on new debt for every new project is likely to continue that path in to oblivion, regardless of the P/E ratio. (or some other equally less forward thinking management practice that you uncover in your fundamental analysis efforts). And I'll add... No amount of historical good decision making from a company's management can prepare for a total market downturn, or lack of investor confidence in general. The market is the market; sometimes it's up irrationally, sometimes it's down irrationally.", "title": "" }, { "docid": "bb7297662734c48964eb593b905aee35", "text": "Another one I have seen mentioned used is Equity Feed. It had varies levels of the software depending on the markets you want and can provide level 2 quotes if select that option. http://stockcharts.com/ is also a great tool I see mentioned with lots of free stuff.", "title": "" }, { "docid": "81c016998574efc6dbf2244659066d3b", "text": "\"Strategy would be my top factor. While this may be implied, I do think it helps to have an idea of what is causing the buy and sell signals in speculating as I'd rather follow a strategy than try to figure things out completely from scratch that doesn't quite make sense to me. There are generally a couple of different schools of analysis that may be worth passing along: Fundamental Analysis:Fundamental analysis of a business involves analyzing its financial statements and health, its management and competitive advantages, and its competitors and markets. When applied to futures and forex, it focuses on the overall state of the economy, interest rates, production, earnings, and management. When analyzing a stock, futures contract, or currency using fundamental analysis there are two basic approaches one can use; bottom up analysis and top down analysis. The term is used to distinguish such analysis from other types of investment analysis, such as quantitative analysis and technical analysis. Technical Analysis:In finance, technical analysis is a security analysis methodology for forecasting the direction of prices through the study of past market data, primarily price and volume. Behavioral economics and quantitative analysis use many of the same tools of technical analysis, which, being an aspect of active management, stands in contradiction to much of modern portfolio theory. The efficacy of both technical and fundamental analysis is disputed by the efficient-market hypothesis which states that stock market prices are essentially unpredictable. There are tools like \"\"Stock Screeners\"\" that will let you filter based on various criteria to use each analysis in a mix. There are various strategies one could use. Wikipedia under Stock Speculator lists: \"\"Several different types of stock trading strategies or approaches exist including day trading, trend following, market making, scalping (trading), momentum trading, trading the news, and arbitrage.\"\" Thus, I'd advise research what approach are you wanting to use as the \"\"Make it up as we go along losing real money all the way\"\" wouldn't be my suggested approach. There is something to be said for there being numerous columnists and newsletter peddlers if you want other ideas but I would suggest having a strategy before putting one's toe in the water.\"", "title": "" }, { "docid": "656fb040050e21c9676a9f63858ab091", "text": "\"I agree completely. \"\"I don't always agree with John Cochrane, but when I do, I agree completely.\"\" I think heavy reliance on either approach to pricing is generally a bad idea. Equilibrium models always include something that you're supposed to inherently know, but never do. No-arbitrage models don't necessarily say anything that you don't (in some mathematical sense) already know. So you're either stuck with unknown parameters, or you can't explain why you're something is worth what you say it is beyond, \"\"Herp derp, other people are doing it.\"\" So I think if buy-side people made some use of no-arbitrage models, they'd have a better understanding of the parameters they're making up, and if sell-side people sometimes used equilibrium models, they'd have a better grasp of what's going on economically. Also, it would have the beneficial effect of reminding people that their models are always wrong, even if they're frequently useful.\"", "title": "" }, { "docid": "91b720167fd3efe4a248785f4df1a208", "text": "\"duffbeer's answers are reasonable for the specific question asked, but it seems to me the questioner is really wanting to know what stocks should I buy, by asking \"\"do you simply listen to 'experts' and hope they are right?\"\" Basic fundamental analysis techniques like picking stocks with a low PE or high dividend yield are probably unlikely to give returns much above the average market because many other people are applying the same well-known techniques.\"", "title": "" }, { "docid": "ed8ac5cafaa4a0d9cf5ad7b74ff04938", "text": "\"As other people have posted starting with \"\"fictional money\"\" is the best way to test a strategy, learn about the platform you are using, etc. That being said I would about how Fundamental Analysis works . Fundamental Analysis is the very basis of learning about an assets true value is priced. However in my humble opinion, I personally just stick with Index funds. In layman's terms Index Funds are essentially computer programs that buy or sell the underlying assets based on the Index they are associated with in the portion of the underlying index. Therefore you will usually be doing as good or as bad as the market. I personally have the background, education, and skillsets to build very complex models to do fundamental analysis but even I invest primarily in index funds because a well made and well researched stock model could take 8 hours or more and Modern Portfolio Theory would suggest that most investors will inevitably have a regression to the mean and have gains equal to the market rate or return over time. Which is what an index fund already does but without the hours of work and transaction cost.\"", "title": "" }, { "docid": "02e7e6416c346bea938301c41d6f9366", "text": "Fundamental Analysis can be used to help you determine what to buy, but they won't give you an entry signal for when to buy. Technical Analysis can be used to help you determine when to buy, and can give you entry signals for when to buy. There are many Technical Indicator which can be used as an entry signal, from as simple as the price crossing above a moving average line and then selling when the price crosses back below the moving average line, to as complicated as using a combination of indicators to all line up for an entry signal to be valid. You need to find the entry signals that would suit your investing or trading and incorporate them as part of your trading plan. If you want to learn more about entry signals you are better off learning more about Technical Analysis.", "title": "" }, { "docid": "31be2354e66b8c8d907fe6f1052f9a87", "text": "Yes, exactly. VaR is just a single tailed confidence interval. To go from model to strategy, you need to design some kind of indicator (i.e. when to buy and when to short or stay out). In practice, this will look like a large matrix with values ranging from -1 to 1 (corresponding to shorting and holding respectively) for each security and each day (or hour, or minute, or tick, etc.), which you then just multiply with the matrix of the stock returns. The resulting matrix will be your daily returns for each stock, you can then just row sum for daily returns of a portfolio, or calculate a cumulative product for cumulative returns. A simple example of an indicator would be something like a value of 1 when the price of the stock is below the 30 day moving average, and 0 otherwise. You can use a battery of econometric models to design these indicators, but the rest of the strategy design is essentially the same, and it's relatively easy to build a one-size-fits-all back-testing code. I'll try to edit this post later and link a blog that goes through some of the code. Edit: [Here](http://www.signalplot.com/simple-machine-learning-model-trade-spy/) is a post that discusses implementing a simple ML strategy. You can ignore most of the content but if you go through the github, you'll see how the ML model is implemented as a strategy. An even easier example can be found from [the github connected to this post](http://www.signalplot.com/how-to-measure-the-performance-of-a-trading-strategy/), where the author is just using a totally arbitrary signal. As you can see, deriving a signal can be a ton of work, but once you have, actually simulating the strategy can be done in just a few lines of code. Hopefully the author won't mind me linking his page here, but I find his coding style to be very clean and good for educational purposes.", "title": "" }, { "docid": "9ce676212f9a76f4a1caaaed0e929408", "text": "\"ycharts.com has \"\"Weighted Average PE Ratio\"\" and a bunch of other metrics that are meant to correspond to well known stock metrics. Other websites will have similar ratios.\"", "title": "" }, { "docid": "d329ce536842b93ab08e0e2b8a644b6b", "text": "He means [Technical Analysis](http://en.wikipedia.org/wiki/Technical_analysis). It can really be simple. Even just trading on the RSI is a way to make money. To learn it, I'd suggest reading wikipedia and messing around with a trading platform- there's one I use at work which is quite user-friendly, I'll PM you if you're interested. Don't really want to be spouting employer information on reddit.", "title": "" }, { "docid": "1c39c551f496cf4eb9805d8702548952", "text": "I assert not so. Even if we assume a zero sum game (which is highly in doubt); the general stock market curves indicate the average player is so bad that you don't have to be very good to have better that 50/50 averages. One example: UP stock nosedived right after some political mess in Russia two years ago. Buy! Profit: half my money in a month. I knew that nosedive was senseless as UP doesn't have to care much about what goes on in Russia. Rising oil price was a reasonable prediction; however this is good for railroads, and most short-term market trends behave as if it is bad.", "title": "" }, { "docid": "a39b37febb386d8d25976b32ed6e7097", "text": "all of these examples are great if you actually believe in fundamentals, but who believes in fundamentals alone any more? Stock prices are driven by earnings, news, and public perception. For instance, a pharma company named Eyetech has their new macular degeneration drug approved by the FDA, and yet their stock price plummeted. Typically when a small pharma company gets a drug approved, it's off to the races. But, Genetech came out said their macular degeneration drug was going to be far more effective, and that they were well on track for approval.", "title": "" } ]	fiqa
23092aa4b14ef0ad62b7b98353ad4bd0	Calculate APR for under 1 year loan	[ { "docid": "f0f3c958dde39e5428620aef3cb675b4", "text": "Is the pay cycle every 2 weeks? So 30% each two week period is 1.3^26 = 917.33 or an APR of 91633%. Loansharks charge less, I believe standard vig was 2%/week for good customers. Only 180% per year.", "title": "" } ]	[ { "docid": "c956cd96a41c6cc45b9a750211d740ac", "text": "Part 2 = 12% -5000/0.12 (1 - 1/(1.12^2 ) = -8450.26 Then subtract year 0s 5000 payment if you havent = -13450.26 and then compare to option 2 -2000/0.12 (1 - 1/(1.12^10) = -11300.46 and subtract 20000 -31300.46 As you can see both values are substantially smaller compared to a 4% discount rate.", "title": "" }, { "docid": "3e2d5e66e86a5fbcc1fbb7874344dc99", "text": "\"Assuming the numbers you gave are forecasted 2013 annual income, you should really use an average and give the lender 1 number, as long as you can provide documentation to back it up. Lenders aren't as sophisticated as considering your monthly income fluctuations into their underwriting algorithm. If you're not tied down to your existing lender, I highly recommend you to shop around. There isn't an \"\"universal lending requirement\"\". You'll be surprised at how flexible they are. Not as a recommendation to get around the rules, but just finding a lender that'll work with your situation. Try personal finance forums such as FatWallet or Slickdeal to find low-cost lenders: http://goo.gl/vIojT\"", "title": "" }, { "docid": "b394fb12247f8f51b41e8ffda1d19a02", "text": "You need the Present Value, not Future Value formula for this. The loan amount or 1000 is paid/received now (not in the future). The formula is $ PMT = PV (r/n)(1+r/n)^{nt} / [(1+r/n)^{nt} - 1] $ See for example http://www.calculatorsoup.com/calculators/financial/loan-calculator.php With PV = 1000, r=0.07, n=12, t=3 we get PMT = 30.877 per month", "title": "" }, { "docid": "2948912ab138ec2aeae9dace2c07d281", "text": "You're looking for the amortization calculation. This calculation is essentially solving for the series of cash flows that will yield a zero balance after the specified term, at the given rate for a loan amount. Once you have solved for the payment amount, you can add additional principal amount to each payment period and see the interest payments and time to zero balance drop.", "title": "" }, { "docid": "11fdb9cf51cdcb86c5b993bc0d90627b", "text": "The question states :- Our insurance company is offering a 30% discount on an $8200/year commercial policy, if we install sprinklers. The insurance is paid in two installments. ... This appears to mean six-monthly payments, so I'll make some comparison calculations using six-monthly loan repayments to keep things simple. Without the loan or sprinklers the insurance costs $4100 every six months. Using this loan payment formula, the calculation below shows, with the 30% discounted insurance, sprinkler maintenance and loan repayment, you would be paying $4655.28 every six months. The discount required to break even is 43.5%. I.e. rearranging the equation :- Alternatively, with the discount of 30% you would break even if the six-monthly repayment amount was $1030. Solving the payment equation for s gives an equation for the loan :- So with the 30% discount you would break even if the loan required was $25989. Checking by back-calculating the periodic payment amount, a :- Likewise we can keep the loan at $40000 and solve for t to find the break-even loan term :- (Note, in this formula Log denotes the natural logarithm.) Now we can set some values :- So with break-even payments the $40000 loan is paid off in just under 65.5 years. I.e. checking :- This just beats the $4100 cost of proceeding without the sprinklers. Notes If your loan repayment was monthly it would reduce the cost of the loan slightly. The periodic interest rate is calculated from the APR according to the method used in the EU and in some cases in US. The calculations above were run using Mathematica.", "title": "" }, { "docid": "1bbb638563f38eb0be7fee88e2c1c70a", "text": "The 1.140924% is calculated by taking 13.69%/12 = 1.140924%. Dividing this number by 100 gives you the answer 1.140924 / 100 = .01140924. When dealing with decimals it's important to remember the relationship between a decimal and a percent. 1% = .01 To return .01 to a percent you must multiple that number by 100. So .01 x 100 = 1% In order to get a decimal from a percent, which is what is used in calculations, you must divide by 100. So, here if we are trying to calculate how much interest you are paying each month we can do this: 9800 * .1369 = $1341.62 (interest you will pay that year IF the principal balance never changed) 1341.62 / 12 = ~111.81 Now, month two 9578.34 * .1369 = 1311.274746 1311.274746 / 12 = 109.28 In order to get your monthly payments (which won't change) for the life of the loan, you can use this formula: Monthly payment = r(PV) / (1-(1+r)^-n) Where: r= Interest Rate (remember if calculating monthly to do .1369/12) PV= Present Value of loan n=time of loan ( in your case 36 since we are talking monthly and 123 = 36) from here we get: [(.1369/12)9800]/(1-(1+.1369/12)^-36) = $333.467 when rounding is $333.47 As far as actual applied interest rate, I'm not even sure what that number is, but I would like to know once you figure out, since the interest rate you're being charged is most definitely 13.69%.", "title": "" }, { "docid": "eaa41ceaeab34d349a7792b63eb3d04d", "text": "Question is, what is this number 0.01140924 13.69/12=0.01140924 In addition, how does one come out with the EIR as 13.69% pa? When calculating payments, PV = 9800, N=36 (months), PMT=333.47, results in a rate of 1.140924% per period, and rate of 13.69%/yr. No idea how they claim 7.5% In Excel, type =RATE(36,333.47,-9800,0,0) And you will get 1.141% as the result. 36 = #payments, 333.47 = payment per period, -9800 is the principal (negative, remember this) And the zeros are to say the payments are month end, second zero is the guess. Edit - I saw the loan is from a Singapore bank. It appears they have different rules on the rates they quote. As quid's answer showed the math, here's the bank's offer page - The EIR is the rate that we, not just US, but most board members, are used to. I thought I'd offer an example using a 30 year mortgage. Yo can see above, a 6% fixed rate somehow morphs into a 3.86% AR. No offense to the Singapore bankers, but I see little value in this number. What surprises me most, is that I've not seen this before. What's baffling is when I change a 15yr term the AP drops to less than half. It's still a 6% loan and there's nothing about it that's 2 percent-ish, in my opinion. Now we know.", "title": "" }, { "docid": "dfa2ffd7e6e3892c85d2adf7481d1bdf", "text": "\"I am trying to set up a formula that will find interest-rate behind first pencil sheets at car dealerships. I am not a car finance expert so I need someone who is intimate with how these loans really work. The points of data I get at first pencil are: 1) Amount Financed 2) Period 3) Monthly Payment The data I need to extrapolate: 1) Rate in percentile so that I can compare to my bank's offer. I have tried this and many other stock \"\"find rate\"\" formulas with no accurate results: R=(A/P^(1/n)-1)n\"", "title": "" }, { "docid": "d304ada0eec7878085696ff363929bd9", "text": "\"To calculate the balance (not just principal) remaining, type into your favorite spreadsheet program: It is important that the periods for \"\"Periods\"\" and \"\"Rate\"\" match up. If you use your annual rate with quarterly periods, you will get a horribly wrong answer. So, if you invest $1000 today, expect 6% interest per year (0.5% interest per month), withdraw $10 at the end of each month, and want to know what your investment balance will be 2 years (24 months) from now, you would type: And you would get a result of $872.84. Or, to compute it manually, use the formula found here by poster uart: This is often taught in high-school here as a application of geomentric series. The derivation goes like this. Using the notation : r = 1 + interest_rate_per_term_as_decimal p = present value a = payment per term eot1 denotes the FV at end of term 1 etc. eot1: rp + a eot2: r(rp + a) + a = r^2p + ra + a eot3: r(r^2p + ra + a) + a = r^3p + r^2a + ra + a ... eotn: r^np + (r^(n-1) + r^(n-2) + ... 1)a = p r^n + a (r^n - 1)/(r-1) That is, FV = p r^n + a (r^n - 1)/(r-1). This is precisely what exel [sic] computes for the case of payments made at the end of each term (payment type = 0). It's easy enough to repeat the calculations as above for the case of payments made at the beginning of each term. This won't work for changing interest rates or changing withdrawal amounts. For something like that, it would be better for you (if you don't want online calculators) to set up a table in a spreadsheet so you can adjust different periods manually.\"", "title": "" }, { "docid": "452f27da8e2c009b017c0b881ec4cf77", "text": "I have answered your question in detail here https://stackoverflow.com/questions/12396422/apr-calculation-formula The annuity formula in FDIC document is at first finding PVIFAD present value annuity due factor and multiplying it with annuity payment and then dividing it by an interest factor of (1+i) to reduce the annuity to an ordinary annuity with end of period payments They could have simply used PVIFA and multiplying it with annuity payment to find the present value of an ordinary annuity In any case, you should not follow the directions in FDIC document to find interest rate at which the present value of annuity equals the loan amount. The method they are employing is commonly used by Finance Professors to teach their students how to find internal rate of return. The method is prone to lengthy trial and error attempts without having any way of knowing what rate to use as an initial guess to kick off the interest rate calculations So this is what I would suggest if you are not short on time and would like to get yourself familiar with numerical methods or iterative techniques to find internal rate of return There are way too many methods at disposal when it comes to finding interest rates some of which include All of the above methods use a seed value as a guess rate to start the iterative calculations and if results from successive calculations tend to converge within a certain absolute Error bound, we assume that one of the rates have been found as there may be as many rates as the order of the polynomial in this case 36 There are however some other methods that help find all rates by making use of Eigenvalues, but for this you would need a lengthy discourse of Linear Algebra One of the methods that I have come across which was published in the US in 1969 (the year I was born :) ) is called the Jenkins Traub method named after the two individuals who worked jointly on finding a solution to all roots of a polynomial discarding any previous work on the same subject I been trying to go over the Jenkins Traub algorithm but am having difficulty understanding the complex nature of the calculations required to find all roots of the polynomial In summary you would be better of reading up on this site about the Newton Raphson method to find IRR", "title": "" }, { "docid": "6a7d38f2451ab0d1f6ad2b66b641b5c7", "text": "The reason it's broken out is very specific: this is showing you how much interest accrued during the month. It is the only place that's shown, typically. Each month's (minimum) payment is the sum of [the interest accrued during that month] and [some principal], say M=I+P, and B is your total loan balance. That I is fixed at the amount of interest that accrued that month - you always must pay off the accrued interest. It changes each month as some of the principal is reduced; if you have a 3% daily interest rate, you owe (0.03B31) approximately (plus a bit as the interest on the interest accrues) each month (or 30 or 28). Since B is going down constantly as principal is paid off, I is also going down. The P is most commonly calculated based on an amortization table, such that you have a fixed payment amount each month and pay the loan off after a certain period of time. That's why P changes each month - because it's easier for people to have a constant monthly payment M, than to have a fixed P and variable I for a variable M. As such, it's important to show you the I amount, both so you can verify that the loan is being correctly charged/paid, and for your tax purposes.", "title": "" }, { "docid": "b3666af20f9bb3570574b277a7faccb3", "text": "Unless you are getting the loan from a loan shark, it is the most common case that each payment is applied to the interest accrued to date and the rest is applied towards reducing the principal. So, assuming that fortnightly means 26 equally-spaced payments during the year, the interest accrued at the end of the first fortnight is $660,000 x (0.0575/26) = $1459.62 and so the principal is reduced by $2299.61 - $1459.62 = $839.99 For the next payment, the principal still owing at the beginning of that fortnight will be $660,000-$839.99 = $659,160.01 and the interest accrued will be $659,160.01 x (0.0575/26) = $1457.76 and so slightly more of the principal will be reduced than the $839.99 of the previous payment. Lather, rinse, repeat until the loan is paid off which should occur at the end of 17.5 years (or after 455 biweekly payments). If the loan rate changes during this time (since you say that this is a variable-rate loan), the numbers quoted above will change too. And no, it is not the case that just %5.75 of the $2300 is interest, and the rest comes off the principle (sic)? Interest is computed on the principal amount still owed ($660,000 for starters and then decreasing fortnightly). not the loan payment amount. Edit After playing around with a spreadsheet a bit, I found that if payments are made every two weeks (14 days apart) rather than 26 equally spaced payments in one year as I used above, interest accrues at the rate of 5.75 x (14/365)% for the 14 days rather than at the rate of (5.75/26)% for the time between payments as I used above each 14 days, $2299.56 is paid as the biweekly mortgage payment instead of the $2299.61 stated by the OP, then 455 payments (slightly less than 17.5 calendar years when leap years are taken into account) will pay off the loan. In fact, that 455-th payment should be reduced by 65 cents. In view of rounding of fractional cents and the like, I doubt that it would be possible to have the last equal payment reduce the balance to exactly 0.", "title": "" }, { "docid": "b2ca60e1f757516b41e9fd67b5707998", "text": "At time = 0, no interest has accrued. That's normal. And the first payment is due after a month, when there's a month's interest and a bit of principal due. Note - I missed weekly payments. You'd have to account for this manually, add a month's interest, then calculate based on weekly payments.", "title": "" }, { "docid": "7e5cd4b3c794252efe76f96afc3b38b5", "text": "In my opinion, the simplest way to run these numbers is to first assume you are borrowing the full amount, including the points, if any. They run a spreadsheet, and while using the new rate, apply your full current payment each month. Then compare balances at month 48. You'll find it easy to calculate the breakeven. In the case of the negative points, it's immediate. For higher points, the B/E is later but then you are further ahead each month.", "title": "" }, { "docid": "efc0e864bbf6af6afaa295022d4b712f", "text": "Illustrating with a shorter example: Suppose I deposit 1,000 USD. Every year I deposit another 100 USD. I want to know how much money will be on that savings account in 4 years. The long-hand calculation is Expressed with a summation And using the formula derived from the summation (as shown by DJohnM) So for 20 years Note in year 20 (or year 4 in the shorter example) the final $100 deposit does not have any time to accrue interest before the valuation of the account.", "title": "" } ]	fiqa
e35e64ce968920dfbd37c59fdeb3a8d5	Standard Deviation with Asset Prices?	[ { "docid": "d2c802df8fba1b6250d9dc0a737592b2", "text": "You can use google docs to create a spreadsheet. In field A2, I put Google will load the prices into the sheet. At that point, I add the following into C12, then copy that line all the way down to the botton of column C. You can find my spreadsheet here. It calculates the moving 10 day standard deviation as a percentage of average price for that time period.", "title": "" }, { "docid": "5fa54cf62db12e34c6926ed17d54279e", "text": "\"Almost every online datasources provide historical prices on given company / index's performance; from this, you can easily calculate \"\"standard deviation\"\" by yourself. With that said, standard deviation presumes a fixed set of data. Most public corporations have data spanning multiple decades, during which a number of things have changed: For these reasons, I have doubts on simplistic measures, such as \"\"standard deviation\"\" measuring any reality on the underlying vehicle. Professional investors usually tend to more time-point data, such as P/E ratio.\"", "title": "" }, { "docid": "bc9c402008b52c0eafe34f56502c5e48", "text": "\"Some years ago, two \"\"academics,\"\" Ibbotson and Sinquefield did these calculations. (Roger) Ibbotson, is still around. So Google Roger Ibbotson, or Ibbotson Associates. There are a number of entries so I won't provide all the links.\"", "title": "" }, { "docid": "f40ce647ec1934ec570d35784baa2775", "text": "James Roth provides a partial solution good for stock picking but let's speed up process a bit, already calculated historical standard deviations: Ibbotson, very good collection of research papers here, examples below Books", "title": "" } ]	[ { "docid": "d36d3ab2aaeb8734fd16cff48398a62a", "text": "\"He's calculating portfolio variance. The general formula for the variance of a portfolio composed of two securities looks like this: where w_a and w_b are the weights of each stock in the portfolio and the sigmas represent the standard deviation/risk of each asset or portfolio. In the case of perfect positive or negative correlation, applying some algebra to the formula relating covariance to the correlation coefficient (rho, the Greek letter that looks like \"\"p\"\"): tells us that the covariance we need in the original formula is simply the product of the standard deviations and the correlation coefficient (-1 in this case). Combining that result with our original formula yields this calculation: Technically we've calculated the portfolio's variance and not it's standard deviation/risk, but since the square root of 0 is still 0, that doesn't matter. The Wikipedia article on Modern Portfolio Theory has a section that describes the mathematical methods I used above. The entire article is worth a read, however.\"", "title": "" }, { "docid": "912d1ca43a19afff15b211b4e1968178", "text": "Metals and Mining is an interesting special case for stocks. It's relationship to U.S. equity (SPX) is particularly weak (~0.3 correlation) compared to most stocks so it doesn't behave like equity. However, it is still stock and not a commodities index so it's relation to major metals (Gold for instance) is not that strong either (-0.6 correlation). Metals and Mining stocks have certainly underperformed the stock market in general over the past 25years 3% vs 9.8% (annualized) so this doesn't look particularly promising. It did have a spectacularly good 8 year period ('99-'07) though 66% (annualized). It's worth remembering that it is still stock. If the market did not think it could make a reasonable profit on the stock the price would decrease until the market thought it could make the same profit as other equity (adjusted slightly for the risk). So is it reasonable to expect that it would give the same return as other stock on average? Yes.. -ish. Though as has been shown in the past 25 years your actual result could vary wildly both positive and negative. (All numbers are from monthly over the last 25 years using VGPMX as a M&M proxy)", "title": "" }, { "docid": "0037a4d50e0ab3ce6e8a5bbc69965b9c", "text": "\"VaR does not do what it is supposed to do which is give you a \"\"floor\"\" with confidence on your potential losses. Even for portfolios with millions of instruments, it will not give you a metric that means anything. The point im trying to convey is that VaR does not give any meaningful information as its horribly inaccurate and that we would be better off WITHOUT VaR.\"", "title": "" }, { "docid": "642b86f98a538677ffa13426a8d71943", "text": "Is it POSSIBLE? Of course. I don't even need to do any research to prove that. Just some mathematical reasoning: Take the S&P 500. Find the performance of each stock in that list over whatever time period you want to use for your experiment. Now select some number of the best-performing stocks from the list -- any number less than 500. By definition, the X best must be better than or equal to the average. Assuming all the stocks on the S&P did not have EXACTLY the same performance, these 10 must be better than average. You now have a diversified portfolio that performed better than the S&P 500 index fund. Of course as they always say in a prospectus, past performance is not a guarantee of future performance. It's certainly possible to do. The question is, if YOU selected the stocks making up a diversified portfolio, would your selections do better than an index fund?", "title": "" }, { "docid": "3ffd7588e47bdcfbf842058ec577af8f", "text": "\"Answering this question is weird, because it is not really precise in what you mean. Do you want all stocks in the US? Do you want a selection of stocks according to parameters? Do you just want a cool looking graph? However, your possible misuse of the word derivative piqued my interest. Your reference to gold and silver seems to indicate that you do not know what a derivative actually is. Or what it would do in a portfolio. The straightforward way to \"\"see\"\" an efficient frontier is to do the following. For a set of stocks (in this case six \"\"randomly\"\" selected ones): library(quantmod) library(fPortfolio) library(PerformanceAnalytics) getSymbols(c(\"\"STZ\"\", \"\"RAI\"\", \"\"AMZN\"\", \"\"MSFT\"\", \"\"TWX\"\", \"\"RHT\"\"), from = \"\"2012-06-01\"\", to = \"\"2017-06-01\"\") returns <- NULL tickerlist <- c(\"\"STZ\"\", \"\"RAI\"\", \"\"AMZN\"\", \"\"MSFT\"\", \"\"TWX\"\", \"\"RHT\"\") for (ticker in tickerlist){ returns <- cbind(returns, monthlyReturn(Ad(eval(as.symbol(ticker))))) } colnames(returns) <- tickerlist returns <- as.timeSeries(returns) frontier <- portfolioFrontier(returns) png(\"\"frontier.png\"\", width = 800, height = 600) plot(frontier, which = \"\"all\"\") dev.off() minvariancePortfolio(returns, constraints = \"\"LongOnly\"\") Portfolio Weights: STZ RAI AMZN MSFT TWX RHT 0.1140 0.3912 0.0000 0.1421 0.1476 0.2051 Covariance Risk Budgets: STZ RAI AMZN MSFT TWX RHT 0.1140 0.3912 0.0000 0.1421 0.1476 0.2051 Target Returns and Risks: mean Cov CVaR VaR 0.0232 0.0354 0.0455 0.0360 https://imgur.com/QIxDdEI The minimum variance portfolio of these six assets has a mean return is 0.0232 and variance is 0.0360. AMZN does not get any weight in the portfolio. It kind of means that the other assets span it and it does not provide any additional diversification benefit. Let us add two ETFs that track gold and silver to the mix, and see how little difference it makes: getSymbols(c(\"\"GLD\"\", \"\"SLV\"\"), from = \"\"2012-06-01\"\", to = \"\"2017-06-01\"\") returns <- NULL tickerlist <- c(\"\"STZ\"\", \"\"RAI\"\", \"\"AMZN\"\", \"\"MSFT\"\", \"\"TWX\"\", \"\"RHT\"\", \"\"GLD\"\", \"\"SLV\"\") for (ticker in tickerlist){ returns <- cbind(returns, monthlyReturn(Ad(eval(as.symbol(ticker))))) } colnames(returns) <- tickerlist returns <- as.timeSeries(returns) frontier <- portfolioFrontier(returns) png(\"\"weights.png\"\", width = 800, height = 600) weightsPlot(frontier) dev.off() # Optimal weights out <- minvariancePortfolio(returns, constraints = \"\"LongOnly\"\") wghts <- getWeights(out) portret1 <- returns%%wghts portret1 <- cbind(monthprc, portret1)[,3] colnames(portret1) <- \"\"Optimal portfolio\"\" # Equal weights wghts <- rep(1/8, 8) portret2 <- returns%%wghts portret2 <- cbind(monthprc, portret2)[,3] colnames(portret2) <- \"\"Equal weights portfolio\"\" png(\"\"performance_both.png\"\", width = 800, height = 600) par(mfrow=c(2,2)) chart.CumReturns(portret1, ylim = c(0, 2)) chart.CumReturns(portret2, ylim = c(0, 2)) chart.Drawdown(portret1, main = \"\"Drawdown\"\", ylim = c(-0.06, 0)) chart.Drawdown(portret2, main = \"\"Drawdown\"\", ylim = c(-0.06, 0)) dev.off() https://imgur.com/sBHGz7s Adding gold changes the minimum variance mean return to 0.0116 and the variance stays about the same 0.0332. You can see how the weights change at different return and variance profiles in the picture. The takeaway is that adding gold decreases the return but does not do a lot for the risk of the portfolio. You also notice that silver does not get included in the minimum variance efficient portfolio (and neither does AMZN). https://imgur.com/rXPbXau We can also compare the optimal weights to an equally weighted portfolio and see that the latter would have performed better but had much larger drawdowns. Which is because it has a higher volatility, which might be undesirable. --- Everything below here is false, but illustrative. So what about the derivative part? Let us assume you bought an out of the money call option with a strike of 50 on MSFT at the beginning of the time series and held it to the end. We need to decide on the the annualized cost-of-carry rate, the annualized rate of interest, the time to maturity is measured in years, the annualized volatility of the underlying security is proxied by the historical volatility. library(fOptions) monthprc <- Ad(MSFT)[endpoints(MSFT, \"\"months\"\")] T <- length(monthprc) # 60 months, 5 years vol <- sd(returns$MSFT)sqrt(12) # annualized volatility optprc <- matrix(NA, 60, 1) for (t in 1:60) { s <- as.numeric(monthprc[t]) optval <- GBSOption(TypeFlag = \"\"c\"\", S = s, X = 50, Time = (T - t) / 12, r = 0.001, b = 0.001, sigma = vol) optprc[t] <- optval@price } monthprc <- cbind(monthprc, optprc) colnames(monthprc) <- c(\"\"MSFT\"\", \"\"MSFTCall50\"\") MSFTCall50rets <- monthlyReturn(monthprc[,2]) colnames(MSFTCall50rets) <- \"\"MSFTCall50rets\"\" returns <- merge(returns, MSFTCall50rets) wghts <- rep(1/9, 9) portret3 <- returns%%wghts portret3 <- cbind(monthprc, portret3)[,3] colnames(portret3) <- \"\"Equal weights derivative portfolio\"\" png(\"\"performance_deriv.png\"\", width = 800, height = 600) par(mfrow=c(2,2)) chart.CumReturns(portret2, ylim = c(0, 4.5)) chart.CumReturns(portret3, ylim = c(0, 4.5)) chart.Drawdown(portret2, main = \"\"Drawdown\"\", ylim = c(-0.09, 0)) chart.Drawdown(portret3, main = \"\"Drawdown\"\", ylim = c(-0.09, 0)) dev.off() https://imgur.com/SZ1xrYx Even though we have a massively profitable instrument in the derivative. The portfolio analysis does not include it because of the high volatility. However, if we just use equal weighting and essentially take a massive position in the out of the money call (which would not be possible in real life), we get huge drawdowns and volatility, but the returns are almost two fold. But nobody will sell you a five year call. Others can correct any mistakes or misunderstandings in the above. It hopefully gives a starting point. Read more at: https://en.wikipedia.org/wiki/Modern_portfolio_theory https://en.wikipedia.org/wiki/Option_(finance) The imgur album: https://imgur.com/a/LoBEY\"", "title": "" }, { "docid": "66cb4794526b297c6db88ed859cc12b4", "text": "Yes, more leverage increases the variance of your individual portfolio (variance of your personal net worth). The simple way to think about it is that if you only own only 50% of your risky assets, then you can own twice as many risky assets. That means they will move around twice as much (in absolute terms). Expected returns and risk (if risk is variance) both go up. If you lend rather than borrow, then you might have only half your net worth in risky assets, and then your expected returns and variation in returns will go down. Note, the practice of using leverage differs from portfolio theory in a couple important ways.", "title": "" }, { "docid": "afb14cb77aafcc94aa5afce67252e3de", "text": "Your question is a moving target. And my answer will be subject to revision. I disagree with the votes to close, as you are asking (imho) what role commodities and specifically oil, play in one's asset allocation. Right? How much may be opinion, but there's a place to ask if. I'm looking at this chart, and thinking, long term, the real return is zero. The discussion regarding gold has been pretty exhausted. For oil, it's not tough to make the case that it will fluctuate, but long term, there's no compelling reason to believe its price will rise any faster than inflation over the really long term.", "title": "" }, { "docid": "20e5cfc13dc16a19aef4dc3ba03eba08", "text": "\"Let me start by giving you a snippet of a report that will floor you. Beat the market? Investors lag the market by so much that many call the industry a scam. This is the 2015 year end data from a report titled Quantitive Analysis of Investor Behavior by a firm, Dalbar. It boggles the mind that the disparity could be this bad. A mix of stocks and bonds over 30 years should average 8.5% or so. Take out fees, and even 7.5% would be the result I expect. The average investor return was less than half of this. Jack Bogle, founder of Vanguard, and considered the father of the index fund, was ridiculed. A pamphlet I got from Vanguard decades ago quoted fund managers as saying that \"\"indexing is a path to mediocrity.\"\" Fortunately, I was a numbers guy, read all I could that Jack wrote and got most of that 10.35%, less .05, down to .02% over the years. To answer the question: psychology. People are easily scammed as they want to believe they can beat the market. Or that they'll somehow find a fund that does it for them. I'm tempted to say ignorance or some other hint at lack of intelligence, but that would be unfair to the professionals, all of which were scammed by Madoff. Individual funds may not be scams, but investors are partly to blame, buy high, sell low, and you get the results above, I dare say, an investor claiming to use index funds might not fare much better than the 3.66% 30 year return above, if they follow that path, buying high, selling low. Edit - I am adding this line to be clear - My conclusion, if any, is that the huge disparity cannot be attributed to management, a 6.7% lag from the S&P return to what the average investor sees likely comes from bad trading. To the comments by Dave, we have a manager that consistently beats the market over any 2-3 year period. You have been with him 30 years and are clearly smiling about your relationship and investing decision. Yet, he still has flows in and out. People buy at the top when reading how good he is, and selling right after a 30% drop even when he actually beat by dropping just 22%. By getting in and out, he has a set of clients with a 30 year record of 6% returns, while you have just over 11%. This paragraph speaks to the behavior of the investor, not managed vs indexed.\"", "title": "" }, { "docid": "ed5e9ea4c94d16c474d6154a73443ab5", "text": "Ok, so disregarding passivity, could you help me through a simplified example? Say I only had two assets, SPY and TLT, with a respective weight of 35 and 65% and I want want to leverage this to 4x. Additionally, say daily return covar is: * B/B .004% * B/S -.004% * S/S .02% Now, if I read correctly, I should buy ATM calls xxx days in the future. Which may look like: Ticker, S, K, Option Price, Delta, Lambda * TLT $126.04 $126.00 $4.35 0.50 14.5 * SPY $134.91 $134.00 $6.26 0.55 11.8 ^ This example is pretty close but some assets are far off. I feel like I'm on the wrong track so I'll stop here. I just want to lever up my risk-parity. Margin rates are too high and I'm docked by Reg-T.", "title": "" }, { "docid": "a7a498ff5b209063fefb4cac4f013b83", "text": "Use the Black-Scholes formula. If you know the current price, an options strike price, time until expiration, and risk-free interest rate, then knowing the market price of the option will tell you what the market's estimation of the volatility is. This does rely on a few assumptions, such as Gaussian random walk, but those are reasonable assumptions for most stocks. You can also get a list of past stock prices, put them in Excel, and ask Excel to calculate the standard deviation with stdev.s(), but that gives you the past volatility. The market's estimate of future volatility is more relevant.", "title": "" }, { "docid": "70d63e6d6967e380b926dcbec8186683", "text": "Variance of a single asset is defined as follows: σ2 = Σi(Xi - μ)2 where Xi's represent all the possible final market values of your asset and μ represents the mean of all such market values. The portfolio's variance is defined as σp2 = Σiwi2σi2 where, σp is the portfolio's variance, and wi stands for the weight of the ith asset. Now, if you include the borrowing in your portfolio, that would classify as technically shorting at the borrowing rate. Thus, this weight would (by the virtue of being negative) increase all other weights. Moreover, the variance of this is likely to be zero (assuming fixed borrowing rates). Thus, weights of risky assets rise and the investor's portfolio's variance will go up. Also see, CML at wikipedia.", "title": "" }, { "docid": "ea037e297eea30bc449f3febfb1d4090", "text": "\"When you have multiple assets available and a risk-free asset (cash or borrowing) you will always end up blending them if you have a reasonable objective function. However, you seem to have constrained yourself to 100% investment. Combine that with the fact that you are considering only two assets and you can easily have a solution where only one asset is desired in the portfolio. The fact that you describe the US fund as \"\"dominating\"\" the forign fund indicates that this may be the case for you. Ordinarily diversification benefits the overall portfolio even if one asset \"\"dominates\"\" another but it may not in your special case. Notice that these funds are both already highly diversified, so all you are getting is cross-border diversification by getting more than one. That may be why you are getting the solution you are. I've seen a lot of suggested allocations that have weights similar to what you are using. Finding an optimal portfolio given a vector of expected returns and a covariance matrix is very easy, with some reliable results. Fancy models get pretty much the same kinds of answers as simple ones. However, getting a good covariance matrix is hard and getting a good expected return vector is all but impossible. Unfortunately portfolio results are very sensitive to these inputs. For that reason, most of us use portfolio theory to guide our intuition, but seldom do the math for our own portfolio. In any model you use, your weak link is the expected return and covariance. More sophisticated models don't usually help produce a more reasonable result. For that reason, your original strategy (80-20) sounds pretty good to me. Not sure why you are not diversifying outside of equities, but I suppose you have your reasons.\"", "title": "" }, { "docid": "9157668ebbbc45a29044fe7436148e70", "text": "Yes, it's a risk. To put it in perspective, If we look at the data for S&P returns since 1871, we get a CAGR of 10.72%. But, that comes with a SDev (Standard deviation) of 18.67%. This results in 53 of the 146 years returning less than 4%. Now if we repeat the exercise over rolling 8 year periods, the CAGR drops to 9.22%, but the SDev drops to 5.74%. This results in just 31 of the 139 periods returning less than 4%. On the flip side, 26 periods had an 8 year return of over 15% CAGR. From the anti-DS article you linked, I see that you like a good analogy. For me, the returns of the S&P over the long term are like going to Vegas, and finding that after you run the math of their craps (dice rolling game) you find the expected return is 10%. You can still lose on a given roll. But over a series of a larger number of rolls, you're far ahead. To D Stanley - I agree that returns are not quite normal, but they are not so far off. Of the 139 rolling returns, we'd expect about 68% or 95 results to be 1 SDev away. We get 88 returns +/-1SDev. 2 SDevs? We'd expect only 5% to lie outside this range, and in fact, I only get one result on the low side and 4 on the high side, 5 results vs the 7 total we'd expect. The results are a bit better (more profitable) than the Normal Bell Curve fit would suggest.", "title": "" }, { "docid": "5685b1ded2c93079cd5e6b11fdc85535", "text": "I found that an application already exists which does virtually everything I want to do with a reasonable interface. Its called My Personal Index. It has allowed me to look at my asset allocation all in one place. I'll have to enter: The features which solve my problems above include: Note - This is related to an earlier post I made regarding dollar cost averaging and determining rate of returns. (I finally got off my duff and did something about it)", "title": "" }, { "docid": "72faef81eeeb16c4029bb254d6fd4804", "text": "> One is whether prices are correlated to each other for long periods of time as a preliminary study suggested (which would go against efficient markets hypothesis, since you could use that info to game the market) or if that result is illusory and the long term returns are close to a standard normal distribution which would follow the effiecient markets hypo. The fascinating thing about this is that the returns themselves show no correlation at all (at any time scale), but the absolute returns do. i.e. following a sharp rise/drop in price, you can predict that a sharp rise/drop is likely to follow, you just can't say in which direction. And this effect carries over for long periods. Given that by the central limit theorem the sum of identically distributed random variables converges to a gaussian, leads one to think that short term returns ought to be gaussian also. However, they're not. Evidently there is something very subtle going on.", "title": "" } ]	fiqa
a94bef5addae478987deb056d59140a6	Mortgage company withholding insurance proceeds	[ { "docid": "33581ef890c5132455e6fe674fb9e65f", "text": "Have you found a general contractor to rebuild your home? I would imagine that someone with a bit of expertise in the area is used to dealing with insurance companies, floating the money for a rebuild, and hitting the gates to receive payment for work accomplished. Business are used to not receiving payment when work is accomplished and it is part of the risk of being in business. They have to buy materials and pay employees with the expectation of payment in the future. Much like workers go to work on a Monday for the work that day, three Friday's later, business often have to float costs but for longer periods of time. If you are looking to be your own general contractor then you will have to float the money on your own. The money should not be used for living expenses or mortgage payments, it should be used for down payments in order to get the work of rebuilding started.", "title": "" }, { "docid": "7b9ff35e36b17f56aeab849c6cbfee6a", "text": "My question is, how do you rebuild a home, without the money to rebuild the home? I ignorantly thought that was why we paid for insurance. The reason that you have insurance is so as to keep the mortgage lender from losing money. That's why you buy the insurance through the mortgage lender and they get paid. Without the insurance, you'd have no home but still have a mortgage. You'd either have to pay off a mortgage with no house or have to declare bankruptcy to shed the mortgage. You essentially have two paths. If you (or the builder/suppliers) can afford to float the cost, you can rebuild the original house. You'll eventually get the $161,000 and can pay off the builder and suppliers. This may involve taking out a construction mortgage to refinance the original mortgage. Presumably the construction mortgage would be with a different lender. The other path is that you can sell the existing property as is, and use the insurance and proceeds to pay off the existing mortgage. Then you'd have no house and no mortgage. You start over and buy a house with a mortgage. It's possible that your insurance payoff isn't enough to pursue either path. Then your option is to get the insurer to make a bigger payoff. This may involve suing them. Note that you may be able to talk the government into suing the insurer for you. They do have regulators who can review things. If you can't get government action, there are lawyers who will do the suing and take their fees out of their winnings.", "title": "" }, { "docid": "224cb615b8a4f5c87aa56f006339a9b0", "text": "Fire insurance, as you have discovered, is a complete ripoff. Most people pay fire insurance all their lives with no benefit whatsoever, and those such as yourself who are lucky enough to get a payout find that it is completely insufficient to replace their loss. I once computed the actual beneficial net present financial value of my fire insurance policy and it came out to $40 per month. The cost was $800 per month. That is typical. Homeowners pay $500 to $800 per year for something that is worth $30 to $50 per year. Ironically banks would actually make more money from mortgages if they did not require mortgagees to buy insurance, but nevertheless they insist on it. It is not about logic, but about fear and irrationality. When I paid off my mortgage and gained ownership of my home the first thing I did was cancel my fire insurance. I now invest the money I would have wasted on insurance, making money instead of losing it. Being compelled to throw money down the toilet on fire insurance is one of the hidden costs of a homeowners mortgage in the United States. In your situation, the main option is to borrow the money to rebuild the house using the land as collateral, if the land is valuable enough. Of course, you still owe the money for your original mortgage on your now (non-existent) home. So, to get a home, you will have to have the income to service two mortgages. A loan officer at a reputable bank can tell you whether you have the income necessary to support two mortgages. If you were maxed out on your original mortgage, then you may not have enough income and you are screwed. In that case you will have to go back to renting and gradually paying off your old mortgage. (If it were me, I would sue the insurance company pro se as a way to get the necessary money to rebuild the home, because insurance companies roll over like a $20 hooker when they get sued. Juries hate insurance companies. But I am unusual in that I love courtrooms and suing people. Most people are terrified of courtrooms though, so it may not be an option for you.)", "title": "" } ]	[ { "docid": "78808e9dd52b33e6f3993f320dd9e810", "text": "Higher life insurance. Mortgage insurance is a very expensive decreasing term life insurance policy, that pays the Lender. You can likely increase your limits for less cost, AND, the payout doesn't depreciate every month, AND, your beneficiary can use the money any way they want - to buy food, or pay property taxes, or whatever.", "title": "" }, { "docid": "6bd83f933a663f9f1897b1a8b0197fb4", "text": "There seems to be a contradiction here: Home warranties not worth paper they're written on and: What struck us is that the HWC [...] immediately had the unit replaced. There is a huge difference when you buy the insurance yourself and when a bank forces you to buy one. Because in the latter case, the insurance is not for you, it's for the bank to protect their collateral (which is your asset as well). It becomes obvious when a claim comes up, because the insurer is not negotiating with you, it's negotiating with another large financial institution. And as far as the stereotype of banks being ruthless behemoths goes, in this case you happen to benefit from being on the behemoth's side and the insurer simply can't brush off a bank as much as it can brush off a person like you. As you've put it, a house in Phoenix without AC is not worth much, so the bank could not let that happen. Because in case of another foreclosure they would have to fix the AC anyway.", "title": "" }, { "docid": "9bc64707f88aaa78053413758a34ecec", "text": "First, you are reading that document correctly, but it's not 78% of original mortgage. It is actually 78% of original home value. For example, if the home was valued at $100K when you bought it and you received a $90K loan, PMI must be removed when you owe $78K, not 78% of $90K. To make matters worse for the bank, they missed the required timing to drop PMI. I would print the document you referenced, cite the applicable portion, and tell them if they do not comply, you will report them for failure to comply. For example, I'm sure I am not the only one in this situation, and the FDIC will be eager to assess the huge fines they can collect from a bank that isn't operating within the law. Something like that.", "title": "" }, { "docid": "59b95e58c37fdc1cfd69882241584d5b", "text": "The key question is whether this number includes taxes and insurance. When you get a mortgage in the U.S., the bank wants to be sure that you are paying your property taxes and that you have homeowners insurance. The mortgage is guaranteed by a lien on the house -- if you don't pay, the bank can take your house -- and the bank doesn't want to find out that your house burned down and you didn't bother to get insurance so now they have nothing. So for most mortgages, the bank collects money from the borrower for the taxes and insurance, and then they pay these things. This can also be convenient for the borrower as you are then paying a fixed amount every month rather than being hit with sizeable tax and insurance bills two or three times a year. So to run the numbers: As others point out, mortgage rates in the US today are running 3% to 4%. I just found something that said the average rate today is 3.6%. At that rate, your actual mortgage payment should be about $1,364. Say $1,400 as we're taking approximate numbers. So if the $2,000 per month does NOT include taxes and insurance, it's a bad deal. If it does, then not so bad. You don't say where you live. But in my home town, property taxes on a $300,000 house would be about $4,500 per year. Insurance is probably another $1000 a year. And if you have to get PMI, add another 1/2% to 3/4%, or $1500 to $2250 per year. Add those up and divide by 12 and you get about $600. Note my numbers here are all highly approximate, will vary widely depending on where the house is, so this is just a general ballpark. $1400 + $600 = $2000, just what you were quoted. So if the number is PITI -- principle, interest, taxes, and insurance -- it's about what I'd expect.", "title": "" }, { "docid": "ceec0eac45ca45706137bdbd5fccca9c", "text": "I believe you may be missing the point here. It appears(and they don't really verify this) that before BofA took over the loan, the homeowners were not using an escrow account. I know this is possible because i had the option of using one or not when i bought my house. So it seems that once BofA took over they automatically created an escrow account and when the normal payments the homeowners were making didn't cover the total monthly balance, they took it out of the payment specifically for the mortgage. So, according to THIS story, its not sensational bullshit. This would be the bank creating an issue. That is, according to the facts that are presented in the article, which may not be the whole story.... Edit- spelling & grammar", "title": "" }, { "docid": "9884bff3588d88726e2c43c5706cb6a3", "text": "With a $40,000 payment there is a 100% chance that the owner will be claiming this as a business expense on their taxes. The IRS and the state will definitely know about it, and the risk of interest and penalties if it is not claimed as income make the best course of action to see a tax adviser. Because taxes will not be taken out by the property owner, the tax payer should also make sure that the estimated $10,000 in federal taxes, if they are in the 25% tax bracket, doesn't trigger other tax issues that could result in penalties, or the need to file quarterly taxes next year. This kind of extra income could also result in a change or an elimination of a health care subsidy. A unexpected mid-year change could trigger the need to refund the subsidy received this year via the tax form next April.", "title": "" }, { "docid": "642b2e4f9c3ead1b07d1a182c3669717", "text": "You would need to check the original mortgage papers you signed with the originators. Chances are you agreed to allow the mortgage to be sold and serviced by other parties. Refinancing would also put you in the same boat unless you got them to take that clause out of the mortgage/refinance papers. Also, chances are most small banks and originators simply can not keep mortgages on their books. There are also third parties that service loans too that do not actually own the mortgages as well. This is another party that could be involved out of many in your mortgage. I would also not worry about 127/139 complaints out of 1,100,000 loans. Most probably were underwater on their mortgage but I am sure a few are legitimate complaints. Banks make mistakes (I know right!). Anyway, good luck and let me know if you find out anything different.", "title": "" }, { "docid": "c3dde80b95a519f0137d6062a6639fb0", "text": "\"In the United States if the person insures an article and then claims a loss of that article, the insurance replaces the missing/destroyed article. If later on the item is found the original is owned by the insurance company. The person who purchased the policy doesn't get to keep both. Of course if the item was so valuable to be priceless the insurance company would be open to an exchange of items or money. But if they suspect fraud...then it becomes a legal matter. Even when a life isn't involved it can be a source of dispute: http://www.artnet.com/magazineus/news/spencer/spencers-art-law-journal5-7-10.asp INSURED V. INSURER: WHEN STOLEN ART IS RECOVERED, WHO OWNS IT? Kenneth S. Levine This essay is about the word \"\"subrogation,\"\" which frequently appears in insurance policies. An insured painting is stolen and the insurance company pays the owner’s claim for the value of the painting. Many years later, when the painting is recovered, its value is many times what it was when the insurance claim was paid. The insurance company takes the position that it owns the painting, while the owner says I own the painting, less the value of the insurance proceeds received. The resolution of this dispute depends on the meaning of the word \"\"subrogation\"\" in the insurance policy. When life insurance is involved, the item being replace is the lost stream of income. The question of returning money and how much would be a legal issue. They would also want to know if there was fraud, and who was involved.\"", "title": "" }, { "docid": "0f674d1424f87c8217af2cb4e6041c10", "text": "You likely received the shares as ordinary income for services of $10k, since they withheld taxes at granting. Separately, you likely had a short term capital loss on sale of $2k, since your holding period seems to have been under one year.", "title": "" }, { "docid": "df414047a4aeb337a3f7f42e8a3c734d", "text": "I think the statute of limitations is 2 years so I suspect that she may not qualify, also BOA was not the last bank to hold her mortgage. I doubt she'll receive anything. She's just glad the whole mess is behind her.", "title": "" }, { "docid": "83b726abb06b3facfd6be7b430d842bc", "text": "Good! The article says it was some kind of collateral protection insurance that customers were signed up for despite it being unrequired for the loan. The accusations is that WF racketeered about 800,000 loans by bundling in this bunk insurance cost as part of the loan structure. I'm glad you're not caught up in it.", "title": "" }, { "docid": "be816d3b043c56037b73e0fd3e97e7a6", "text": "There are two scenarios that I see. You have a mortgage on the property. Generally the insurance company sends the funds to the lender, who then releases the funds to you as you make the repairs. They do it this way because if you never make the repairs the value of the collateral is decreased, and the lender wants to protect their investment. There is no mortgage. You will get the funds directly, and the insurance company will not force you to make the repairs especially if the repairs are cosmetic in nature. In either case if you don't fix the cause of the leak, and make repairs to the site around the leak, you will run into a problem in the future if the leak continues, or the rot and mold continues to spread. If you file a future claim they are likely to ask for proof of the original repair. If you didn't make it, they are likely to deny the second claim. They will say the cause is the original incident and if you had made the repair, the second incident wouldn't have happened. They are likely to drop you at that point. If you try to sell the house you will have to disclose the original leak, and the potential buyers will want you to make the repairs. Any mold or rot spotted by the home inspector will be a big issue for them. It is also likely to be an item that they will be advised to demand that you get a legitimate company to make the repair before the deal can move forward, and won't negotiate a lower price or a credit for $x so they can get the repair done. Some will just cancel the deal based on the inspection report.", "title": "" }, { "docid": "f083ed99a77ec184628e7104112651b5", "text": "I understand where you're coming from but you're mostly just quoting the plaintiff's attorney. That's not going to be the source of unbiased information. Furthermore, I don't trust general news sources when it comes to complex financial reporting. I don't really even trust business journals as they are mostly filled with j degrees without real experience. Bankruptcy cases can get very complex and unpredictable because judge's have significant leeway; you really need to read the case opinion to see what really went down. I work in finance and deal with bankruptcies on a semi-regular case. I am on the buy side (the side that would be screwed in cases like this) so my inherent bias goes your way against poor management. If this guy actually moved assets from company 1 to company 2 at a non-arms length transaction then that is misconduct and assets can be recovered from company 2 usually. If Learning Annex was pari passu with Robert and he pulled dividends out to himself, that is misconduct that will be punished by a bankruptcy court. If he did these things they are not smart business practices, and will be punished. Your condescension does not help your case. I most likely know far more about this topic than you, as I have seen the nuances corporate bankruptcies take on in the real world. I just don't trust grossly oversimplified reporting in a case that is ongoing.", "title": "" }, { "docid": "1e22e319440af62240c9722695ad34af", "text": "All transactions involving fraud or theft are void by their nature. Title to your money never changes hands. You are entitled by law to have assets stolen from you returned to you. In cases of negligence or broker malfeasance, lawsuits or SIPC protection are your primary recourse.", "title": "" }, { "docid": "4dbb1d642271e9274a2279c952d8d644", "text": "That is your bill because the services were performed for you. You still can negotiate with the doctor however. Suggest that while you aren't willing to pay the full share, you will pay the negotiated amount he would have actually gotten from the insurance company (or some fraction thereof). Doc did make a mistake, but you are very much liable for it.", "title": "" } ]	fiqa
939d513af382b399dd88894f241ae9f8	Can my spouse be the primary signer on my car's loan?	[ { "docid": "c6a6d74cd53d39bcc7907a768865a60e", "text": "Go to your local bank or credit union before talking to a dealership. Ask them if putting both names on the loan makes a difference regarding rates and maximum loan you qualify for. Ask them to run the loan application both ways. Having both names on the loan helps build the credit of the spouse that has a lower score. You may find that both incomes are needed for a car loan if the couple has a mortgage or other joint obligations. The lender will treat the entire mortgage payment or rent payment as a liability against the person applying for the loan, they won't split the housing payment in half if only one name will be on the car loan. Therefore sometimes the 2nd persons income is needed even if their credit is not as good. That additional income without a significant increase in liabilities can make a huge difference regarding the loan they can qualify for. Once the car is in your possession, it doesn't matter who drives it. In general the insurance company will put both spouses as authorized drivers. Note: it is almost always better to ask your bank or credit union about a car loan before going to the dealership. That gives you a solid data point regarding a loan, and removes a major complexity to the negotiations at the dealership.", "title": "" }, { "docid": "513716bd8123b3b8e4ea561413cd6295", "text": "\"If your spouse wishes to buy a car and finance it with a car loan, they are free to do so. Once they have bought a car, they are free to let you use it. However, if you are the owner of the car, the loan is going to have to be in your name. Your spouse can't get a loan backed by an asset they don't own. They could get a personal loan and then give the money to you, but the interest rates would likely be rather high. Also, even if you aren't on any of the paperwork, you being married likely will affect the situation. It will depend on what state you're in. If you want to go that route, one of the best ways to find out is to simply have your spouse ask the people that would be providing the loan \"\"Can I finance this separate from my spouse, or will they be included in the credit evaluation?\"\"\"", "title": "" } ]	[ { "docid": "21f52f29dbe899c34e4170287fea73f2", "text": "It is possible. You'll have to call the bank and ask what documentation is required, I'm pretty sure they'll want notarized authorization by all partners, at least.", "title": "" }, { "docid": "e25c53b47f5600ad2fef4d5a83062748", "text": "I have been in this situation and I essentially went for the truthful answer. I first explained that co-signing for a loan wasn't just vouching for the person, which I certainly would do, but it was putting my name on the loan and making me the person they loan company would go after if a payment was ever missed. Then I explained that even within married couples, money can be a major source of strife and fights, it would be even worse for someone not quite as close like a family member or friend. Essentially I wouldn't want to risk my relationship with a good friend or family member over some financial matter.", "title": "" }, { "docid": "7ce55e9bf0dbb378da0165acec00aef8", "text": "It's not typically possible for someone to jointly own the house, who is not also jointly liable for the mortgage. This doesn't matter however, because it is possible for two people to get a mortgage together, where only one person's income is assessed by the lender. If that person could get a mortgage of that amount on their own, then the couple should also be able to get the same mortgage. Source: My wife and I got a mortgage like this. She is self-employed, rather than meet the very high requirements for proving her self-employment income, we simply said that we only wanted my income to be taken into consideration.", "title": "" }, { "docid": "be567931b31c66a4bfb91a86c6f0360b", "text": "Insurance companies vary. A former roommate of mine had to add me to her policy as a driver even though there was 0 chance I was ever going to drive this roommate's car. My insurance company on the other hand had me add my spouse after we got married even though they had his information for a different transaction before the wedding.", "title": "" }, { "docid": "33990c5f6c1113de1a9550be690686a5", "text": "\"I think the part of your question about not wanting to \"\"mess up more\"\" is the most important element. You say you know someone with good credit who is willing to co-sign for you, but let's be honest -- your credit isn't bad for no reason. Your credit's bad because you have a history of not paying on your obligations. Putting someone else's credit at risk, even though they may be willing to try and help, could be doing exactly what you said you're trying to avoid -- messing up more. This person's heart is in the right place, but you really have to ask yourself if you should put them in jeopardy by agreeing to guarantee your debts. So the vehicle you bought is older and has a lot of miles -- you knew that when you bought it. So you're paying a high interest rate because of your bad credit history -- you knew that when you bought it. Why you think the vehicle's only going to last another year is what confuses me. There are many vehicles out there with much higher mileage that are still on the road, and with proper preventative maintenance there's no reason your truck can't do the same. The fact is, you just don't like what you're paying or what you're driving (even though you were good with both when someone was willing to extend you credit), so now you see this other person's willingness to co-sign for you as your ticket out of a situation you no longer want to be in. My suggestion is that you stay with the loan you have, take care of the vehicle to make it last, and prove that you can pay your obligations. Hopping from loan to loan isn't going to do your credit any favors. One of the big factors for your credit score is the average age of accounts. Going and signing a new loan now will only drag that number down and hurt your score, not help it. And there's no guarantee the next car you buy with your friend's help is going to last the length of that loan either. I would be careful about this \"\"grass is greener on the other side\"\" attitude and just bear through your situation, if only to prove to yourself that you can do it. There's nothing saying your friend won't still be willing to co-sign for you later on down the line of something does happen to the truck, but you can show them that you're trying to be responsible in the meantime by following through on what you already agreed to.\"", "title": "" }, { "docid": "e49810044068601d5e562c156a09e65c", "text": "\"The best solution is to \"\"buy\"\" the car and get your own loan (like @ChrisInEdmonton answered). That being said, my credit union let me add my spouse to a title while I still had a loan for a title filing fee. You may ask the bank that holds the title if they have a provision for adding someone to the title without changing the loan. Total cost to me was an afternoon at the bank and something like $20 or $40 (it's been a while).\"", "title": "" }, { "docid": "2ca37ccaeb56e7276aa66a6183d66820", "text": "\"I really don't feel co-signing this loan is in the best interests of either of us. Lets talk about the amount of money you need and perhaps I can assist you in another way. I would be honest and tell them it isn't a good deal for anybody, especially not me. I would then offer an alternative \"\"loan\"\" of some amount of money to help them get financing on their own. The key here is the \"\"loan\"\" I offer is really a gift and should it ever be returned I would be floored and overjoyed. I wouldn't give more than I can afford to not have. Part of why I'd be honest to spread the good word about responsible money handling. Co-signed loans (and many loans themselves) probably aren't good financial policy if not a life & death or emergency situation. If they get mad at me it won't matter too much because they are family and that won't change.\"", "title": "" }, { "docid": "6654e2df896eda68dbf3c8da9c17bbfb", "text": "I've done this, though with a loan company rather than a bank. We agreed on price, drove to the loan company's office (the seller having notified them in advance), I gave them the money, got the title, and they gave the balance to the seller. Important point is that you get the signed-off title from the lienholder.", "title": "" }, { "docid": "9f36797606cd3c5a1d9b22a6c654c87d", "text": "\"In the US, \"\"title\"\" is the document that shows ownership of the car. It is a nicely printed document you get from the DMV, that includes the information about the car and about you. You \"\"sign off the title\"\" when you sell the car - part of the title is a form on which the owner of the title can assign it to someone else. With your signature on the title, the new owner goes to the DMV which exchanges it to a new title in the new owner's name. Never sign on the title unless you got the payment for the car from the buyer. Usually, when the car is bought with a loan, the lender holds the title. Since you need to sign off the title to pass the ownership if you sell the car - lender holding on to it will prevent you from selling the car until the lender gives you the title back (when you pay off the loan). Your boss, acting as a lender, wants the title to hold on to it to prevent you from selling the car that secures your debt to him. He wants that (usually pink) piece of paper. Here's an article explaining about the title and showing a sample. Lenders holding the title will usually also add an endorsement at the DMV, so that you can't go and claim that you lost it.\"", "title": "" }, { "docid": "325b3734841f36f5f68aa1ba1902f580", "text": "I know this question has a lot of answers already, but I feel the answers are phrased either strongly against, or mildly for, co-signing. What it amounts down to is that this is a personal choice. You cannot receive reliable information as to whether or not co-signing this loan is a good move due to lack of information. The person involved is going to know the person they would be co-signing for, and the people on this site will only have their own personal preferences of experiences to draw from. You know if they are reliable, if they will be able to pay off the loan without need for the banks to come after you. This site can offer general theories, but I think it should be kept in mind that this is wholly a personal decision for the person involved, and them alone to make based on the facts that they know and we do not.", "title": "" }, { "docid": "be2d7fa01fe5a2e48f5e6a4a268f77ab", "text": "\"You are co-signer on his car loan. You have no ownership (unless the car is titled in both names). One option (not the best, see below) is to buy the car from him. Arrange your own financing (take over his loan or get a loan of your own to pay him for the car). The bank(s) will help you take care of getting the title into your name. And the bank holding the note will hold the title as well. Best advice is to get with him, sell the car. Take any money left after paying off the loan and use it to buy (cash purchase, not finance) a reliable, efficient, used car -- if you truly need a car at all. If you can get to work by walking, bicycling or public transit, you can save thousands per year, and perhaps use that money to start you down the road to \"\"financial independence\"\". Take a couple of hours and research this. In the US, we tend to view cars as necessary, but this is not always true. (Actually, it's true less than half the time.) Even if you cannot, or choose not to, live within bicycle distance of work, you can still reduce your commuting cost by not financing, and by driving a fuel efficient vehicle. Ask yourself, \"\"Would you give up your expensive vehicle if it meant retiring years earlier?\"\" Maybe as many as ten years earlier.\"", "title": "" }, { "docid": "f20c565456d604db8ccfa9d1dbcb0f82", "text": "As a former banker, the title of the car will be assigned to the loan account holder(s) because legally, he/she/they are responsible for payments. I've never heard of any case where the car title differs from the loan account holder(s). Throughout my career in the bank, I've come across quite a number of parents who did the same for their children and the car title was always assigned to the loan account holder's name. You do have a choice of applying for a joint loan with one of your parents unless if you are concerned about what your credit score might be. Once the loan has been paid off, the title could be changed to your name from your parents of course. As for insurance, there are numerous options where the insurance would cover all drivers of the car however at a slightly higher price like you've mentioned.", "title": "" }, { "docid": "1cee712904c22253683819c081aae7fc", "text": "I've been an F&I Manager at a new car dealership for over ten years, and I can tell you this with absolute certainty, your deal is final. There is no legal obligation for you whatsoever. I see this post is a few weeks old so I am sure by now you already know this to be true, but for future reference in case someone in a similar situation comes across this thread, they too will know. This is a completely different situation to the ones referenced earlier in the comments on being called by the dealer to return the vehicle due to the bank not buying the loan. That only pertains to customers who finance, the dealer is protected there because on isolated occasions, which the dealer hates as much as the customer, trust me, you are approved on contingency that the financing bank will approve your loan. That is an educated guess the finance manager makes based on credit history and past experience with the bank, which he is usually correct on. However there are times, especially late afternoon on Fridays when banks are preparing to close for the weekend the loan officer may not be able to approve you before closing time, in which case the dealer allows you to take the vehicle home until business is back up and running the following Monday. He does this mostly to give you sense of ownership, so you don't go down the street to the next dealership and go home in one of their vehicles. However, there are those few instances for whatever reason the bank decides your credit just isn't strong enough for the rate agreed upon, so the dealer will try everything he can to either change to a different lender, or sell the loan at a higher rate which he has to get you to agree upon. If neither of those two things work, he will request that you return the car. Between the time you sign and the moment a lender agrees to purchase your contract the dealer is the lien holder, and has legal rights to repossession, in all 50 states. Not to mention you will sign a contingency contract before leaving that states you are not yet the owner of the car, probably not in so many simple words though, but it will certainly be in there before they let you take a car before the finalizing contract is signed. Now as far as the situation of the OP, you purchased your car for cash, all documents signed, the car is yours, plain and simple. It doesn't matter what state you are in, if he's cashed the check, whatever. The buyer and seller both signed all documents stating a free and clear transaction. Your business is done in the eyes of the law. Most likely the salesman or finance manager who signed paperwork with you, noticed the error and was hoping to recoup the losses from a young novice buyer. Regardless of the situation, it is extremely unprofessional, and clearly shows that this person is very inexperienced and reflects poorly on management as well for not doing a better job of training their employees. When I started out, I found myself in somewhat similar situations, both times I offered to pay the difference of my mistake, or deduct it from my part of the sale. The General Manager didn't take me up on my offer. He just told me we all make mistakes and to just learn from it. Had I been so unprofessional to call the customer and try to renegotiate terms, I would have without a doubt been fired on the spot.", "title": "" }, { "docid": "887b6da259f747c3ebaa6117d49b4758", "text": "Not sure if it is the same in the States as it is here in the UK (or possibly even depends on the lender) but if you have any amount outstanding on the loan then you wouldn't own the vehicle, the loan company would. This often offers extra protection if something goes wrong with the vehicle - a loan company talking to the manufacturer to get it resolved carries more weight than an individual. The laon company will have an army of lawyers (should it get that far) and a lot more resources to deal with anything, they may also throw in a courtesy car etc.", "title": "" }, { "docid": "7562fccb8f7052786a1017dce80635e2", "text": "You should have her sell it to you for the amount of the outstanding loan. You take out a loan in your name for the amount (or at least, the amount you have to come up with). You then transfer the title from her to you, just as you would if you were buying the car from someone else. While the title is in her name, she has ownership. This isn't a technicality, this is the explicit legal situation you two have agreed to.", "title": "" } ]	fiqa
cce2fc3eacfd6965180c67b80d5d8af6	How can I remove the movement of the stock market as a whole from the movement in price of an individual share?	[ { "docid": "9ffa2801a53684aa4778439927170236", "text": "As others have pointed out, the value of Apple's stock and the NASDAQ are most likely highly correlated for a number of reasons, not least among them the fact that Apple is part of the NASDAQ. However, because numerous factors affect the entire market, or at least a significant subset of it, it makes sense to develop a strategy to remove all of these factors without resorting to use of an index. Using an index to remove the effect of these factors might be a good idea, but you run the risk of potentially introducing other factors that affect the index, but not Apple. I don't know what those would be, but it's a valid theoretical concern. In your question, you said you wanted to subtract them from each other, and only see an Apple curve moving around a horizontal line. The basic strategy I plan to use is similar but even simpler. Instead of graphing Apple's stock price, we can plot the difference between its stock price on business day t and business day t-1, which gives us this graph, which is essentially what you're looking for: While this is only the preliminaries, it should give you a basic idea of one procedure that's used extensively to do just what you're asking. I don't know of a website that will automatically give you such a metric, but you could download the price data and use Excel, Stata, etc. to analyze this. The reasoning behind this methodology builds heavily on time series econometrics, which for the sake of simplicity I won't go into in great detail, but I'll provide a brief explanation to satisfy the curious. In simple econometrics, most time series are approximated by a mathematical process comprised of several components: In the simplest case, the equations for a time series containing one or more of the above components are of the form that taking the first difference (the procedure I used above) will leave only the random component. However, if you want to pursue this rigorously, you would first perform a set of tests to determine if these components exist and if differencing is the best procedure to remove those that are present. Once you've reduced the series to its random component, you can use that component to examine how the process underlying the stock price has changed over the years. In my example, I highlighted Steve Jobs' death on the chart because it's one factor that may have led to the increased standard deviation/volatility of Apple's stock price. Although charts are somewhat subjective, it appears that the volatility was already increasing before his death, which could reflect other factors or the increasing expectation that he wouldn't be running the company in the near future, for whatever reason. My discussion of time series decomposition and the definitions of various components relies heavily on Walter Ender's text Applied Econometric Time Series. If you're interested, simple mathematical representations and a few relevant graphs are found on pages 1-3. Another related procedure would be to take the logarithm of the quotient of the current day's price and the previous day's price. In Apple's case, doing so yields this graph: This reduces the overall magnitude of the values and allows you to see potential outliers more clearly. This produces a similar effect to the difference taken above because the log of a quotient is the same as the difference of the logs The significant drop depicted during the year 2000 occurred between September 28th and September 29th, where the stock price dropped from 26.36 to 12.69. Apart from the general environment of the dot-com bubble bursting, I'm not sure why this occurred. Another excellent resource for time series econometrics is James Hamilton's book, Time Series Analysis. It's considered a classic in the field of econometrics, although similar to Enders' book, it's fairly advanced for most investors. I used Stata to generate the graphs above with data from Yahoo! Finance: There are a couple of nuances in this code related to how I defined the time series and the presence of weekends, but they don't affect the overall concept. For a robust analysis, I would make a few quick tweaks that would make the graphs less appealing without more work, but would allow for more accurate econometrics.", "title": "" }, { "docid": "55f332da2bc6737a330b520c90586811", "text": "The portion of a stock movement not correlated with stocks in general is called Alpha. I don't know of any online tools to graph alpha. Keep in mind that a company like Apple is so huge right now that any properly weighted index will have to correlate with it to some degree.", "title": "" }, { "docid": "677d029fc911b655f13856941d36ee06", "text": "I use StockCharts for spread charting. To take your question as an example, here is the chart of Apple against Nasdaq.", "title": "" }, { "docid": "a0cd91b399a6be1b0b1c3f45c7b510e4", "text": "You run the regression R_{i,t} = a + bR_{m,t} + e_t, then a + e_t is the variation that isn't shared with the market's variation.", "title": "" } ]	[ { "docid": "04aa3f08bc524c7cfd39327dd271d2c8", "text": "The rest of the market knows when the dividends are paid out, and that will be reflected naturally in the share price. That's why there is no way to consistently beat the market. Because the market is other human beings, who's sum of knowledge is greater than any individual. Everything in the stock market boils down to this in one way or another.", "title": "" }, { "docid": "60e6bdbead28c05fcc3b0f90ae5bcc63", "text": "Of course, this calculation does not take into consideration the fact that once the rights are issues, the price of the shares will drop. Usually this drop corresponds to the discount. Therefore, if a rights issue is done correctly share price before issuance-discount=share price after issuance. In this result, noone's wealth changes because shareholders can then sell their stock and get back anything they had to put in.", "title": "" }, { "docid": "d8ff7ca00fec2541fdf41386bef1ea37", "text": "\"Share prices change (or not) when shares are bought and sold. Unless he's sitting on a large percentage of the total shares, the fact that he isn't selling or buying means he's having no effect ar all on the stock price, and unless there's a vote war going on in the annual meeting his few stockholder votes aren't likely to have much effect there either (though there's always the outside chance of his being a tiebreaker). On the other hand, there's nothing inherently wrong with holding shares for a very long time and just taking the dividends (\"\"clipping coupons\"\"). Buy-and-hold is a legitimate strategy. Basically: His reason is wrong, but his action may be right, and you should probably just not ask.\"", "title": "" }, { "docid": "8e0d392ac4a2a2360895cf6d0ba3cf28", "text": "You can, in theory, have the stock price go up without any trading actually occurring. It depends on how the price is quoted. The stock price is not always quoted as the last price someone paid for it. It can also be quoted as the ask price, which is the price a seller is willing to sell at, and the price youd pay if you bought at market. If I am a seller, I can raise the asking price at any time. And if there are no other sellers, or at least none that are selling lower than me, it would look like the price is going up. Because it is, it now costs more to buy it. But no trading has actually occurred.", "title": "" }, { "docid": "c9e6b039d5ab2e479f5befaba52149c0", "text": "\"One of two things is true: You own less than 5% of the total shares outstanding. Your transaction will have little to no effect on the market. For most purposes you can use the current market price to value the position. You own more than 5% of the total shares outstanding. You are probably restricted on when, where, and why you can sell the shares because you are considered part owner of the company. Regardless, how to estimate (not really \"\"calculate,\"\" since some of the inputs to the formula are assumptions a.k.a. guesses) the value depends on exactly what you plan to with the result.\"", "title": "" }, { "docid": "59cb85ca6365148f787ab8d328ae0bd3", "text": "\"One idea: If you came up with a model to calculate a \"\"fair price range\"\" for a stock, then any time the market price were to go below the range it could be a buy signal, and above the range it could be a sell signal. There are many ways to do stock valuation using fundamental analysis tools and ratios: dividend discount model, PEG, etc. See Wikipedia - Stock valuation. And while many of the inputs to such a \"\"fair price range\"\" calculation might only change once per quarter, market prices and peer/sector statistics move more frequently or at different times and could generate signals to buy/sell the stock even if its own inputs to the calculation remain static over the period. For multinationals that have a lot of assets and income denominated in other currencies, foreign exchange rates provide another set of interesting inputs. I also think it's important to recognize that with fundamental analysis, there will be extended periods when there are no buy signals for a stock, because the stocks of many popular, profitable companies never go \"\"on sale\"\", except perhaps during a panic. Moreover, during a bull market and especially during a bubble, there may be very few stocks worth buying. Fundamental analysis is designed to prevent one from overpaying for a stock, so even if there is interesting volume and price movement for the stock, there should still be no signal if that action happens well beyond the stock's fair price. (Otherwise, it isn't fundamental analysis — it's technical analysis.) Whereas technical analysis can, by definition, generate far more signals because it largely ignores the fundamentals, which can make even an overvalued stock's movement interesting enough to generate signals.\"", "title": "" }, { "docid": "10eb73ad36ad882760546e1c2d65b48a", "text": "As stock prices have declined, the net worth of people has come down. Imagine owning a million shares of a stock worth $100/share. This is worth $100,000,000. Now, if the stock is suddenly trading at $50/share then some would say you have lost $50,000,000. The value of the stock is less. The uncertainty is always there as there are differences between one day's close and another day's open possibly. The sale price is likely to be near the last trade is what is being used here. If you place a market order to sell your stock, the price may move between the time the order is placed and when it is filled. There are limit orders that could be used if you want to control the minimum price you get though you give up that the order has to be filled as otherwise people could try to sell shares for millions of dollars that wouldn't work out well.", "title": "" }, { "docid": "e1cd963949bd42e4b4be6eb2f69e4fef", "text": "Depending on what currency the price is quoted in and is originally sold, currency fluctuation can also carry over onto the price in your currency. An example for that would be bitcoin prices which sometimes show heavy ups and downs in one currency, but seem totally stable in another and can be tracked back to changed exchange rates between currencies. Also like others have said, prices on stocks are not actually fixed. You can offer to buy or sell at any price. Only if 2 people want to buy or sell for the same price there will actually be a transaction.", "title": "" }, { "docid": "be25c00709dc2f9ad36703697f9aa7c0", "text": "The volume required to significantly move the price of a security depends completely on the orderbook for that particular security. There are a variety of different reasons and time periods that a security can be halted, this will depend a bit on which exchange you're dealing with. This link might help with the halt aspect of your question: https://en.wikipedia.org/wiki/Trading_halt", "title": "" }, { "docid": "7e6f4f331cde178e6cbfb007797db5f9", "text": "The risk of the particular share moving up or down is same for both. however in terms of mitigating the risk, Investor A is conservative on upside, ie will exit if he gets 10%, while is ready to take unlimited downside ... his belief is that things will not go worse .. While Investor B is wants to make at least 10% less than peak value and in general is less risk averse as he will sell his position the moment the price hits 10% less than max [peak value] So it more like how do you mitigate a risk, as to which one is wise depends on your belief and the loss appetite", "title": "" }, { "docid": "4281c150f771e7826991543427f819bb", "text": "No. The market cap has no relation to actual money that flowed anywhere, it is simple the number of shares multiplied by the current price, and the current price is what potential buyers are (were) willing to pay for the share. So any news that increases or decreases interest in shares changes potentially the share price, and with that the market cap. No money needs to flow.", "title": "" }, { "docid": "2824c6bf0ee10d68971d086851792687", "text": "When stocks have a change in price it is because of a TRADE. To have a trade you have to have both a buyer and a seller. When the price of a security is going up there are an equal amount of shares being sold as being bought. When the price of a security is going down there are an equal amount of shares being bought as being sold. There almost always is an unequal amount of shares waiting to be sold compared to the amount waiting to be bought. But waiting shares do not move the price, only when the purchase price and the sale price agree, and a trade occurs, does the price move. So the price does not go down because more shares are being sold. Neither does the price go up because more shares are being bought.", "title": "" }, { "docid": "cc5eee7dc69b5b6abe644a127fc97e84", "text": "I think the simple answer to your question is: Yes, when you sell, that drives down the price. But it's not like you sell, and THEN the price goes down. The price goes down when you sell. You get the lower price. Others have discussed the mechanics of this, but I think the relevant point for your question is that when you offer shares for sale, buyers now have more choices of where to buy from. If without you, there were 10 people willing to sell for $100 and 10 people willing to buy for $100, then there will be 10 sales at $100. But if you now offer to sell, there are 11 people selling for $100 and 10 people buying for $100. The buyers have a choice, and for a seller to get them to pick him, he has to drop his price a little. In real life, the market is stable when one of those sellers drops his price enough that an 11th buyer decides that he now wants to buy at the lower price, or until one of the other 10 buyers decides that the price has gone too low and he's no longer interested in selling. If the next day you bought the stock back, you are now returning the market to where it was before you sold. Assuming that everything else in the market was unchanged, you would have to pay the same price to buy the stock back that you got when you sold it. Your net profit would be zero. Actually you'd have a loss because you'd have to pay the broker's commission on both transactions. Of course in real life the chances that everything else in the market is unchanged are very small. So if you're a typical small-fry kind of person like me, someone who might be buying and selling a few hundred or a few thousand dollars worth of a company that is worth hundreds of millions, other factors in the market will totally swamp the effect of your little transaction. So when you went to buy back the next day, you might find that the price had gone down, you can buy your shares back for less than you sold them, and pocket the difference. Or the price might have gone up and you take a loss.", "title": "" }, { "docid": "979158a3361ada6e39994e1e8d9d4f5e", "text": "\"Instead of using the actual index, use a mutual fund as a proxy for the index. Mutual funds will include dividend income, and usually report data on the value of a \"\"hypothetical $10,000 investment\"\" over the life of the fund. If you take those dollar values and normalize them, you should get what you want. There are so many different factors that feed into general trends that it will be difficult to draw conclusions from this sort of data. Things like news flow, earnings reporting periods, business cycles, geopolitical activity, etc all affect the various sectors of the economy differently.\"", "title": "" }, { "docid": "d87dc6a132fb23f070de78d1b19daad8", "text": "When you buy a stock, you become a partial owner of the company that the stock is for. As the company is valued at a higher or lower amount, the stock will reflect that by gaining or losing value. You still own that stock. For example, if you bought a stock for $10 per share and next week it is worth $8 dollars per share, the only loss incurred is on paper. You do not have to pay the difference (which I think is what you are asking?) and will only physically lose that money if you sell at that point. Similarly if that stock becomes worth $12, you have only gained money on paper and can only physically see it if you sell at that point.", "title": "" } ]	fiqa
4ac2d9c9ac84b2a266081ddfd649bcd4	Will refinancing my auto loan hurt my mortgage approval or help it?	[ { "docid": "bc39ebc96f26ede3ea62f4829612c593", "text": "\"Generally it is not recommended that you do anything potentially short-term deleterious to your credit during the process of seeking a mortgage loan - such as opening a new account, closing old accounts, running up balances, or otherwise applying for any kind of loan (people often get carried away and apply for loans to cover furniture and appliances for the new home they haven't bought yet). You are usually OK to do things that have at least a short-term positive effect, like paying down debt. But refinancing - which would require applying for a non-home loan - is exactly the sort of hard-pull that can drop your credit rating. It is not generally advised. The exception to this is would be if you have an especially unusual situation with an existing loan (like your car), that is causing a deal-breaking situation with your home loan. This would for example be having a car payment so high that it violates maximum Debt-to-Income ratios (DTI). If your monthly debt payments are more than 43% of your monthly income, for instance, you will generally be unable to obtain a \"\"qualified mortgage\"\", and over 28-36% will disqualify you from some lenders and low-cost mortgage options. The reason this is unusual is that you would have to have a bizarrely terrible existing loan, which could somehow be refinanced without increasing your debt while simultaneously providing a monthly savings so dramatic that it would shift your DTI from \"\"unacceptable\"\" to \"\"acceptable\"\". It's possible, but most simple consumer loan refis just don't give that kind of savings. In most cases you should just \"\"sit tight\"\" and avoid any new loans or refinances while you seek a home purchase. If you want to be sure, you'll need to figure out your DTI ratio (which I recommend anyway) and see where you would be before and after a car refinance. If this would produce a big swing, maybe talk with some mortgage loan professionals who are familiar with lending criteria and ask for their opinion as to whether the change would be worth it. 9 times out of 10, you should wait until after your loan is closed and the home is yours before you try to refinance your car. However I would only warn you that if you think your house + car payment is too much for you to comfortably afford, I'd strongly recommend you seriously reconsider your budget, current car ownership, and house purchasing plans. You might find that after the house purchase the car refi isn't available either, or fine print means it wouldn't provide the savings you thought it would. Don't buy now hoping an uncertain cost-saving measure will work out later.\"", "title": "" } ]	[ { "docid": "1907a57fe43b6cf6cbaa2ac2986d6ec0", "text": "If you're a bit into the loan, then they're probably hoping that you'll take longer to pay off the loan. Is there a fee for refinancing the loan? If so, be sure to take that into account. A smart way to approach it (assuming that the fees are low or zero) would be to continue making the same payment you had been before the refinance. Then you'll end your loan ahead of schedule. (This assumes that there's no prepayment penalty.)", "title": "" }, { "docid": "6a5c235f65fc1356e1a56bb1815957f7", "text": "\"a link to this article grabbed my Interest as I was browsing the site for something totally unrelated to finance. Your question is not silly - I'm not a financial expert, but I've been in your situation several times with Carmax Auto Finance (CAF) in particular. A lot of people probably thought you don't understand how financing works - but your Car Loan set up is EXACTLY how CAF Financing works, which I've used several times. Just some background info to anyone else reading this - unlike most other Simple Interest Car Financing, with CAF, they calculate per-diem based on your principal balance, and recalculate it every time you make a payment, regardless of when your actual due date was. But here's what makes CAF financing particularly fair - when you do make a payment, your per-diem since your last payment accrued X dollars, and that's your interest portion that is subtracted first from your payment (and obviously per-diem goes down faster the more you pay in a payment), and then EVerything else, including Any extra payments you make - goes to Principal. You do not have to specify that the extra payment(S) are principal only. If your payment amount per month is $500 and you give them 11 payments of $500 - the first $500 will have a small portion go to interest accrued since the last payment - depending on the per-diem that was recalculated, and then EVERYTHING ELSE goes to principal and STILL PUSHES YOUR NEXT DUE DATE (I prefer to break up extra payments as precisely the amount due per month, so that my intention is clear - pay the extra as a payment for the next month, and the one after that, etc, and keep pushing my next due date). That last point of pushing your next due date is the key - not all car financing companies do that. A lot of them will let you pay to principal yes, but you're still due next month. With CAF, you can have your cake, and eat it too. I worked for them in College - I know their financing system in and out, and I've always financed with them for that very reason. So, back to the question - should you keep the loan alive, albeit for a small amount. My unprofessional answer is yes! Car loans are very powerful in your credit report because they are installment accounts (same as Mortgages, and other accounts that you pay down to 0 and the loan is closed). Credit cards, are revolving accounts, and don't offer as much bang for your money - unless you are savvy in manipulating your card balances - take it up one month, take it down to 0 the next month, etc. I play those games a lot - but I always find mortgage and auto loans make the best impact. I do exactly what you do myself - I pay off the car down to about $500 (I actually make several small payments each equal to the agreed upon Monthly payment because their system automatically treats that as a payment for the next month due, and the one after that, etc - on top of paying it all to principal as I mentioned). DO NOT leave a dollar, as another reader mentioned - they have a \"\"good will\"\" threshold, I can't remember how much - probably $50, for which they will consider the account paid off, and close it out. So, if your concern is throwing away free money but you still want the account alive, your \"\"sweet spot\"\" where you can be sure the loan is not closed, is probably around $100. BUT....something else important to consider if you decide to go with that strategy of keeping the account alive (which I recommend). In my case, CAF will adjust down your next payment due, if it's less than the principal left. SO, let's say your regular payment is $400 and you only leave a $100, your next payment due is $100 (and it will go up a few cents each month because of the small per-diem), and that is exactly what CAF will report to the credit bureaus as your monthly obligation - which sucks because now your awesome car payment history looks like you've only been paying $100 every month - so, leave something close to one month's payment (yes, the interest accrued will be higher - but I'm not a penny-pincher when the reward is worth it - if you left $400 for 1.5 years at 10% APR - that equates to about $50 interest for that entire time - well worth it in my books. Sorry for rambling a lot, I suck myself into these debates all the time :)\"", "title": "" }, { "docid": "61afca1ab51dceb80e7ed827b9f2c474", "text": "For a $350 monthly payment, she is currently paying $200 monthly in interest. You say that no bank will refinance her, but that is not true, I'm sure many banks are happy to refinance her to the value of the car. She should start that process. You'll find that your suggestion to pay $5000 down on the current loan is pretty similar to what she would need to bring to a bank to refinance (maybe as much as $7000 to refinance). After that she would be paying a much lower amount in interest, and she could still retire the loan a year or two (but she would be paying even less in interest). The advantage to borrowing from her emergency fund is that she retires the loan 14 months earlier. The problem is that you are prioritizing the least amount paid, and she is prioritizing an emergency fund. Emergency funds are also very important. You might have better success if you prioritize paying back the emergency fund in your plan. If she puts $7000 down to refinance, assume a 3 year loan at 4.5% with a $150 monthly payment. Instead of paying down the remaining $5000 quickly what if she put the extra $200/month toward paying back her emergency fund? It would take the same 3 years to fully pay it back without impacting the rest of her budget at all. If she has extra room in her budget, she could pay back that emergency fund even faster. Many of us who prioritize minimizing interest paid and maximizing interest earned already have a robust emergency fund. Your girlfriend isn't wrong to value that. Unexpected emergencies can cause much more interest to be paid if there is no way to deal with them. (That's how paycheck and title lenders capture their customers.) Talk to her about what emergencies she might need the money for, and make a plan to replenish the fund, and you're much more likely to have her buy in.", "title": "" }, { "docid": "f7c3764a2d481ea96cc97e9e0968a1dd", "text": "\"Yes, it is possible for you to refinance your existing auto loan, and so long as you can get the loan on more favorable terms (e.g.: lower interest rate), it is absolutely a smart thing to do. In fact, you would be well advised to do so as soon as possible if the car was a new car, if you refinance a NEW car soon enough you will likely still be able to get new car interest rates. Even if it is a pre-owned vehicle you shouldn't wait too long, since your car will only depreciate in value. You will almost certainly get more favorable terms from any bank or credit union directly then you would when you go through the dealership, because the dealership is allowed to mark-up your interest rate several percentage points as profit for themselves. Your best bet would be to go to a local credit union, their rates tend to be most competitive since they are \"\"owned\"\" by their members.\"", "title": "" }, { "docid": "afcc0a968d643cff64bd0cfd4ba171b7", "text": "I don't know what rates are available to you now, but yes, if you can refinance your car at a better rate with no hidden fees, you might save some money in interest. However, there are a couple of watchouts: Your original loan was a 6 year loan, and you have 5 years remaining. If you refinance your car with a new 6 year loan, you will be paying on your car for 7 years total, and you will end up paying more interest even though your interest rate might have gone down. Make sure that your new loan, in addition to having a lower rate than the old loan, does not have a longer term than what you have remaining on the original loan. Make sure there aren't any hidden fees or closing costs with the new loan. If there are, you might be paying your interest savings back to the bank in fees. If your goal is to save money in interest, consider paying off your loan early. Scrape together extra money every month and send it in, making sure that it is applied to the principal of your loan. This will shorten your loan and save you money on interest, and can be much more significant than refinancing. After your loan is paid off, continue saving the amount you were spending on your car payment, so you can pay cash for your next car and save even more.", "title": "" }, { "docid": "1e3057c1fc6c4cd285ff605bf4f2e8ef", "text": "Yes. I've spoken to mortgage officers from various banks who will do conventional loans with anything as low as 3.5% down, however there are many more restrictions (e.g., normally you can borrow funds from a parent or relative for a down payment, in this case that was prohibited). If you are already pre-approved, then your approval letter should state the specifics you need to adhere to. If you would like to modify that (e.g. put a smaller amount down), then you could still get the loan, but your pre-approval won't be valid. I would recommend speaking with your lender (and perhaps with a few others as well) about the new home you are looking at.", "title": "" }, { "docid": "b8b1294c9216a410a61241b8b9dd9eae", "text": "Your current loan is for a new car. Your refinanced loan would probably be for a used car. They have different underwriting standards and used car loan rates are usually higher because of the higher risks associated with the loans. (People with better credit will tend to buy new cars.) This doesn't mean that you can't come out ahead after refinancing but you'll probably have to do a bit of searching. I think you should take a step back though. 5% isn't that much money and five years is a long time. Nobody can predict the future but my experience tells me that the **** is going to hit the fan at least once over any five year period, and it's going to be a really big dump at least once over any ten year period. Do you have savings to cover it or would you have to take a credit card advance at a much higher interest rate? Are you even sure that's an option - a lot of people who planned to use their credit card advances as emergency savings found their credit limits slashed before they could act. I understand the desire to reduce what you pay in interest but BTDT and now I don't hesitate to give savings priority when I have some excess cash. There's no one size fits all answer but should have at least one or two months of income saved up before you start considering anything like loan prepayments.", "title": "" }, { "docid": "8cd2b0cad322b4f13659c8aa60ac7af7", "text": "There are a few things you should keep in mind when getting another vehicle: DON'T use dealership financing. Get an idea of the price range you're looking for, and go to your local bank or find a local credit union and get a pre-approval for a loan amount (that will also let you know what kind of interest rates you'll get). Your credit score is high enough that you shouldn't have any problems securing a decent APR. Check your financing institution's rules on financing beyond the vehicle's value. The CU that refinanced my car noted that between 100% and 120% of the vehicle's value means an additional 2% APR for the life of the loan. Value between 120% and 130% incurred an additional 3% APR. Your goal here is to have the total amount of the loan less than or equal to the value of the car through the sale / trade-in of your current vehicle, and paying off whatever's left out of pocket (either as a down-payment, or simply paying off the existing loan). If you can't manage that, then you're looking at immediately being upside-down on the new vehicle, with a potential APR penalty.", "title": "" }, { "docid": "ef7053fffebc96b8ba633d6201f49f4d", "text": "Before we were married my wife financed a car at a terrible rate. I think it was around 20%. When trying to refinance it the remaining loan was much larger than the value of the car, so no one was interested in refinancing. I was able to do a balance transfer to a credit card around 10%. This did take on a bit of risk, which almost came up when the car was totaled in an accident. Fortunately the remaining balance was now less than the value of the car, otherwise I would have been stuck with a credit card payment and no vehicle.", "title": "" }, { "docid": "8fb4ed771f66e236487e2f709666e10e", "text": "Just call your credit union and ask if they will let you refinance at the lower rate. If they won't, then just increase your payment every month so that your car is paid off early (in 36 months instead of 60). You won't get the lower rate, but since your loan will be paid early, you'll be saving interest anyway.", "title": "" }, { "docid": "adeb62f3873388115cae70ccf26f77c7", "text": "Used car dealers will sometimes deliberately issue high-interest-rate subprime loans to folks who have poor credit. But taking that kind of risk on a mortgage, when you aren't also taking profit out of the sale, really isn't of interest to anyone who cares about making a profit. There might be a nonprofit our there which does so, but I don't know of one. Fix your credit before trying to borrow.", "title": "" }, { "docid": "d3a08d8fa1c0f462a8c672b0a120b634", "text": "My car loan, much to my disappointment, was through Wells Fargo. I went to my credit union and refinanced (with a .1% increase of interest) and I feel a lot better about my payments. In reality, it pays for itself because my credit union is customer-owned, and my dividends offset the extra cost. :)", "title": "" }, { "docid": "d102521380188ac82074b1f3dd94efda", "text": "There is a 3rd option: take the cash back offer, but get the money from a auto loan from your bank or credit union. The loan will only be for. $22,500 which can still be a better deal than option B. Of course the monthly payment can make it harder to qualify for the mortgage. Using the MS Excel goal seek tool and the pmt() function: will make the total payment equal to 24K. Both numbers are well above the rates charged by my credit union so option C would be cheaper than option B.", "title": "" }, { "docid": "1dbbd5514b243927ca57f2e225547cd7", "text": "Anytime you borrow money at that rate, you are getting ripped off. One way to rectify this situation is to pay the car off as soon as possible. You can probably get a second job that makes $1000 per month. If so you will be done in 4 months. Do that and you will pay less than $300 in interest. It is a small price to pay for an important lesson. While you can save some money refinancing, working and paying the loan off is, in my opinion a better option. Even if you can get the rate down to 12%, you are still giving too much money to banks.", "title": "" }, { "docid": "69496aa2e2eeda0c08710e7a8b1f73bc", "text": "what you aim to do is a great idea and it will work in your favor for a number of reasons. First, paying down your loan early will save you lots in interest, no brainer. Second, keeping the account open will improve your credit score by 1) increases the number of installment trade lines you have open, 2)adds to your positive payment history and 3) varies your credit mix. If your paid your car off you will see a DROP in your credit score because now you have one less trade line. To address other issues as far as credit scoring, it does not matter(much) for your score if you have a $1000 car loan or a $100,000 car loan. what matters is whether or not you pay on time, and what your balance is compared to the original loan amount. So the quicker you pay DOWN the loans or mortgages the better. Pay them down, not off! As far how the extra payments will report, one of two things will happen. Either they will report every month paid as agreed (most likely), or they wont report anything for a few years until your next payment is due(unlikely, this wont hurt you but wont help you either). Someone posted they would lower the amount you paid every month on your report and thus lower your score. This is not true. even if they reported you paid $1/ month the scoring calculations do not care. All they care is whether or not you're on time, and in your case you would be months AHEAD of time(even though your report cant reflect this fact either) HOWEVER, if you are applying for a mortgage the lower monthly payment WOULD affect you in the sense that now you qualify for a BIGGER loan because now your debt to income ratio has improved. People will argue to just pay it off and be debt free, however being debt free does NOT help your credit. And being that you own a home and a car you see the benefits of good credit. You can have a million dollars in the bank but you will be denied a loan if you have NO or bad credit. Nothing wrong with living on cash, I've done it for years, but good luck trying to rent a car, or getting the best insurance rates, and ANYTHING in life with poor credit. Yeah it sucks but you have to play the game. I would not pay down do $1 though because like someone else said they may just close the account. Pay it down to 10 or 20 percent and you will see the most impact on your credit and invest the rest of your cash elsewhere.", "title": "" } ]	fiqa
765f7078f85c4994a549e69cb6373a12	Easiest way to diversify savings	[ { "docid": "d5900e8422cad37c7a227b98844f458a", "text": "You can apply for Foreign currency accounts. But they aren't saving accounts by any means, but more like current accounts. Taking money out will involve charges. You have to visit the bank website to figure out what all operations can be performed on your account. Barclays and HSBC allow accounts in foreign currency. Other banks also will be providing the same services. Are there banks where you can open a bank account without being a citizen of that country without having to visit the bank in person Depends on country by country. Are there any online services for investing money that aren't tied to any particular country? Get yourself a trading account and invest in foreign markets i.e. equities, bonds etc. But all in all be ready for the foreign exchange risks involved in denominating assets in multiple currencies.", "title": "" }, { "docid": "38a479e3fac8a4d4deb5d8caa993d72a", "text": "\"Having savings only in your home currency is relatively 'low risk' compared with other types of 'low diversification'. This is because, in a simple case, your future cash outflows will be in your home currency, so if the GBP fluctuates in value, it will (theoretically) still buy you the same goods at home. In this way, keeping your savings in the same currency as your future expenditures creates a natural hedge against currency fluctuation. This gets complicated for goods imported from other countries, where base price fluctuates based on a foreign currency, or for situations where you expect to incur significant foreign currency expenditures (retirement elsewhere, etc.). In such cases, you no longer have certainty that your future expenditures will be based on the GBP, and saving money in other currencies may make more sense. In many circumstances, 'diversification' of the currency of your savings may actually increase your risk, not decrease it. Be sure you are doing this for a specific reason, with a specific strategy, and not just to generally 'spread your money around'. Even in case of a Brexit, consider: what would you do with a bank account full of USD? If the answer is \"\"Convert it back to GBP when needed (in 6 months, 5 years, 30, etc.), to buy British goods\"\", then I wouldn't call this a way to reduce your risk. Instead, I would call it a type of investment, with its own set of risks associated.\"", "title": "" }, { "docid": "638947ae1029dd877c240c92506276e6", "text": "Are there banks where you can open a bank account without being a citizen of that country without having to visit the bank in person? I've done it the other way around, opened a bank account in the UK so I have a way to store GBP. Given that Britain is still in the EU you can basically open an account anywhere. German online banks for instance allow you to administrate anything online, should there be cards issued you would need an address in the country. And for opening an account a passport is sufficient, you can identify yourself in a video chat. Now what's the downside? French banks' online services are in French, German banks' services are in German. If that doesn't put you off, I would name such banks in the comments if asked. Are there any online services for investing money that aren't tied to any particular country? Can you clarify that? You should at least be able to buy into any European or American stock through your broker. That should give you an ease of mind being FCA-regulated. However, those are usually GDRs (global depository receipts) and denominated in GBp (pence) so you'd be visually exposed to currency rates, by which I mean that if the stock goes up 1% but the GBP goes up 1% in the same period then your GDR would show a 0% profit on that day; also, and more annoyingly, dividends are distributed in the foreign currency, then exchanged by the issuer of the GDR on that day and booked into your account, so if you want to be in full control of the cashflows you should get a trading account denominated in the currency (and maybe situated in the country) you're planning to invest in. If you're really serious about it, some brokers/banks offer multi-currency trading accounts (again I will name them if asked) where you can trade a wide range of instruments natively (i.e. on the primary exchanges) and you get to manage everything in one interface. Those accounts typically include access to the foreign exchange markets so you can move cash between your accounts freely (well for a surcharge). Also, typically each subaccount is issued its own IBAN.", "title": "" } ]	[ { "docid": "d2d3bd109720544f604955e63246b380", "text": "Having separate savings account for your kids college fund, retirement fund, holiday fund etc is one way to compartmentalise savings. Downside to this is the management of these funds especially if you have them with different banks. Like others here have pointed out, keeping track via spreadsheet is relatively easy and especially most banks now like OCBC, HSBC , DBS, POSB etc offer online banking, however from a financial standpoint, spreading your funds doesn't allow you to get as much interest as you would from one account that has the highest interest rate.", "title": "" }, { "docid": "992d568e9fb89ec12d5ec9d42554e089", "text": "What is your investing goal? And what do you mean by investing? Do you necessarily mean investing in the stock market or are you just looking to grow your money? Also, will you be able to add to that amount on a regular basis going forward? If you are just looking for a way to get $100 into the stock market, your best option may be DRIP investing. (DRIP stands for Dividend Re-Investment Plan.) The idea is that you buy shares in a company (typically directly from the company) and then the money from the dividends are automatically used to buy additional fractional shares. Most DRIP plans also allow you to invest additional on a monthly basis (even fractional shares). The advantages of this approach for you is that many DRIP plans have small upfront requirements. I just looked up Coca-cola's and they have a $500 minimum, but they will reduce the requirement to $50 if you continue investing $50/month. The fees for DRIP plans also generally fairly small which is going to be important to you as if you take a traditional broker approach too large a percentage of your money will be going to commissions. Other stock DRIP plans may have lower monthly requirements, but don't make your decision on which stock to buy based on who has the lowest minimum: you only want a stock that is going to grow in value. They primary disadvantages of this approach is that you will be investing in a only a single stock (I don't believe that can get started with a mutual fund or ETF with $100), you will be fairly committed to that stock, and you will be taking a long term investing approach. The Motley Fool investing website also has some information on DRIP plans : http://www.fool.com/DRIPPort/HowToInvestDRIPs.htm . It's a fairly old article, but I imagine that many of the links still work and the principles still apply If you are looking for a more medium term or balanced investment, I would advise just opening an online savings account. If you can grow that to $500 or $1,000 you will have more options available to you. Even though savings accounts don't pay significant interest right now, they can still help you grow your money by helping you segregate your money and make regular deposits into savings.", "title": "" }, { "docid": "ddcd57afd6bc86c1fa0c5230b92e65dc", "text": "The simplest way is to invest in a few ETFs, depending on your tolerance for risk; assuming you're very short-term risk tolerant you can invest almost all in a stock ETF like VOO or VTI. Stock market ETFs return close to 10% (unadjusted) over long periods of time, which will out-earn almost any other option and are very easy for a non-finance person to invest in (You don't trade actively - you leave the money there for years). If you want to hedge some of your risk, you can also invest in Bond funds, which tend to move up in stock market downturns - but if you're looking for the long term, you don't need to put much there. Otherwise, try to make sure you take advantage of tax breaks when you can - IRAs, 401Ks, etc.; most of those will have ETFs (whether Vanguard or similar) available to invest in. Look for funds that have low expense ratios and are fairly diversified (ie, don't just invest in one small sector of the economy); as long as the economy continues to grow, the ETFs will grow.", "title": "" }, { "docid": "bac44a8c730685829aae631e9b51a6dc", "text": "\"Okay. Savings-in-a-nutshell. So, take at least year's worth of rent - $30k or so, maybe more for additional expenses. That's your core emergency fund for when you lose your job or total a few cars or something. Keep it in a good savings account, maybe a CD ladder - but the point is it's liquid, and you can get it when you need it in case of emergency. Replenish it immediately after using it. You may lose a little cash to inflation, but you need liquidity to protect you from risk. It is worth it. The rest is long-term savings, probably for retirement, or possibly for a down payment on a home. A blended set of stocks and bonds is appropriate, with stocks storing most of it. If saving for retirement, you may want to put the stocks in a tax-deferred account (if only for the reduced paperwork! egads, stocks generate so much!). Having some money (especially bonds) in something like a Roth IRA or a non-tax-advantaged account is also useful as a backup emergency fund, because you can withdraw it without penalties. Take the money out of stocks gradually when you are approaching the time when you use the money. If it's closer than five years, don't use stocks; your money should be mostly-bonds when you're about to use it. (And not 30-year bonds or anything like that either. Those are sensitive to interest rates in the short term. You should have bonds that mature approximately the same time you're going to use them. Keep an eye on that if you're using bond funds, which continually roll over.) That's basically how any savings goal should work. Retirement is a little special because it's sort of like 20 years' worth of savings goals (so you don't want all your savings in bonds at the beginning), and because you can get fancy tax-deferred accounts, but otherwise it's about the same thing. College savings? Likewise. There are tools available to help you with this. An asset allocation calculator can be found from a variety of sources, including most investment firms. You can use a target-date fund for something this if you'd like automation. There are also a couple things like, say, \"\"Vanguard LifeStrategy funds\"\" (from Vanguard) which target other savings goals. You may be able to understand the way these sorts of instruments function more easily than you could other investments. You could do a decent job for yourself by just opening up an account at Vanguard, using their online tool, and pouring your money into the stuff they recommend.\"", "title": "" }, { "docid": "592ad3963c42c459197267cc2ced76b4", "text": "I keep several savings accounts. I use an online-only bank that makes it very easy to open a new account in about 2 minutes. I keep the following accounts: Emergency Fund with 2 months of expenses. I pretend this money doesn't even exist. But if something happened that I needed money right away, I can get it. 6 6-month term CDs, with one maturing every month, each with 1 month's worth of expenses. This way, every month, I'll have a CD that matures with the money I would need that month if I lose my job or some other emergency that prevents me from working. You won't make as much interest on the 6-month term, but you'll have cash every month if you need it. Goal-specific accounts: I keep an account that I make a 'car payment' into every month so I'll have a down-payment saved when I'm ready to buy a car, and I'm used to making a payment, so it's not an additional expense if I need a loan. I also keep a vacation account so when it's time to take the family to Disneyland, I know how much I can budget for the trip. General savings: The 'everything else' account. When I just NEED to buy a new LCD TV on Black Friday, that's where I go without touching my emergency funds.", "title": "" }, { "docid": "f87db8d477d31f9aafafbeeae7a91cd3", "text": "\"One approach is to invest in \"\"allocation\"\" mutual funds that use various methods to vary their asset allocation. Some examples (these are not recommendations; just to show you what I am talking about): A good way to identify a useful allocation fund is to look at the \"\"R-squared\"\" (correlation) with indexes on Morningstar. If the allocation fund has a 90-plus R-squared with any index, it probably isn't doing a lot. If it's relatively uncorrelated, then the manager is not index-hugging, but is making decisions to give you different risks from the index. If you put 10% of your portfolio in a fund that varies allocation to stocks from 25% to 75%, then your allocation to stocks created by that 10% would be between 2.5% to 7.5% depending on the views of the fund manager. You can use that type of calculation to invest enough in allocation funds to allow your overall allocation to vary within a desired range, and then you could put the rest of your money in index funds or whatever you normally use. You can think of this as diversifying across investment discipline in addition to across asset class. Another approach is to simply rely on your already balanced portfolio and enjoy any downturns in stocks as an opportunity to rebalance and buy some stocks at a lower price. Then enjoy any run-up as an opportunity to rebalance and sell some stocks at a high price. The difficulty of course is going through with the rebalance. This is one advantage of all-in-one funds (target date, \"\"lifecycle,\"\" balanced, they have many names), they will always go through with the rebalance for you - and you can't \"\"see\"\" each bucket in order to get stressed about it. i.e. it's important to think of your portfolio as a whole, not look at the loss in the stocks portion. An all-in-one fund keeps you from seeing the stocks-by-themselves loss number, which is a good way to trick yourself into behaving sensibly. If you want to rebalance \"\"more aggressively\"\" then look at value averaging (search for \"\"value averaging\"\" on this site for example). A questionable approach is flat-out market-timing, where you try to get out and back in at the right times; a variation on this would be to buy put options at certain times; the problem is that it's just too hard. I think it makes more sense to buy an allocation fund that does this for you. If you do market time, you want to go in and out gradually, and value averaging is one way to do that.\"", "title": "" }, { "docid": "bcfdc5548584e2092b703b1b86d553f7", "text": "You don't really have a lot of money, and that isn't a criticism as much as that you are limited to diversification. For example, I would estimate you can only have one or two stocks for a buy-write scheme. Secondly you may be only to buy one fund with a high minimum investment, and a second fund with a smaller minimum investment. Thirdly there is not a whole lot of money to make a large difference. One options might be to look at iShares since your are with Fidelity. Trading those are commission free and the minimum investment is one share. They offer many sector funds. Since you were in a CD ladder you might be looking for stability of principle. If so you can look at USMV and PFF. If you can tolerate a little more volatility DGRO. Having said that you seem interested in doing some buy-writes. Why not mix and match? Pick a stock, like INTC (for example not a recommendation), and buy-write with half the money and some combination of iShares for the rest.", "title": "" }, { "docid": "d5e71508fdf5bcc1d535cac18c15e692", "text": "\"The best strategy for RSU's, specifically, is to sell them as they vest. Usually, vesting is not all in one day, but rather spread over a period of time, which assures that you won't sell in one extremely unfortunate day when the stock dipped. For regular investments, there are two strategies I personally would follow: Sell when you need. If you need to cash out - cash out. Rebalance - if you need to rebalance your portfolio (i.e.: not cash out, but reallocate investments or move investment from one company to another) - do it periodically on schedule. For example, every 13 months (in the US, where the long term cap. gains tax rates kick in after 1 year of holding) - rebalance. You wouldn't care about specific price drops on that day, because they also affect the new investments. Speculative strategies trying to \"\"sell high buy low\"\" usually bring to the opposite results: you end up selling low and buying high. But if you want to try and do that - you'll have to get way more technical than just \"\"dollar cost averaging\"\" or similar strategies. Most people don't have neither time nor the knowledge for that, and even those who do rarely can beat the market (and never can, in the long run).\"", "title": "" }, { "docid": "44fbb65d9903574d648335fb707ac6dd", "text": "I think you need to understand the options better before you go around calling anything worthless... $11k in a 1% savings account gets you just over $100 each year. Obviously you're not buying Ferraris with your returns but it's $100 more than your checking account will pay you. And, you're guaranteed to get your money back. I think a CD ladder is a great way to store your emergency fund. The interest rate on a CD is typically a bit better than a regular savings account, though the money is locked away and while we seem to be on the cusp of a rate increase it might not be the best time to put the money in jail. Generally there is some sort of fee or lost interest from cashing a CD early. You're still guaranteed to get your money back. Stock trading is probably a terrible idea. If you want some market exposure I'd take half of the money and buy a low expense S&P ETF, I wouldn't put my whole savings if I were you (or if I were me). Many large brokers have an S&P ETF option that you can generally buy with no commission and no loads. Vanguard is a great option VOO, Schwab has an S&P mutual fund SWPPX, and there are others. Actively trading individual stocks is a great way to let commissions and fees erode your account. There are some startup alternatives with lower fees, but personally I would stay away from individual stock picking unless you are in school for Finance and have some interest in paying attention and you're ready to possibly never see the money again. You're not guaranteed to get your money back. There are also money market accounts. These will typically pay some interest based on exposing your funds to some risk. It can be a bit better return than a savings account, but I probably wouldn't bother. An IRA (ROTH and Traditional) is just an account wrapper that offers certain tax benefits while placing certain restrictions on the use of some or all of the money until you reach retirement age. As a college student you should probably be more concerned about an emergency fund or traveling than retirement savings, though some here may disagree with me. With your IRA you can buy CDs or annuities, or stocks and ETFs or any other kind of security. Depending on what you buy inside the IRA, you might not be guaranteed to get your money back. First you need to figure out what you'd like to use the money for. Then, you need to determine when you'd need the money for that use. Then, you need to determine if you can sleep at night while your stock account fluctuates a few percent each day. If you can't, or you don't have answers for these questions, a savings account is a really low friction/low risk place store money and combat inflation while you come up with answers for those questions.", "title": "" }, { "docid": "5625496dedd8862d5e88416d729fc2de", "text": "\"First off, the answer to your question is something EVERYONE would like to know. There are fund managers at Fidelity who will a pay $100 million fee to someone who can tell them a \"\"safe\"\" way to earn interest. The first thing to decide, is do you want to save money, or invest money. If you just want to save your money, you can keep it in cash, certificates of deposit or gold. Each has its advantages and disadvantages. For example, gold tends to hold its value over time and will always have value. Even if Russia invades Switzerland and the Swiss Franc becomes worthless, your gold will still be useful and spendable. As Alan Greenspan famously wrote long ago, \"\"Gold is always accepted.\"\" If you want to invest money and make it grow, yet still have the money \"\"fluent\"\" which I assume means liquid, your main option is a major equity, since those can be readily bought and sold. I know in your question you are reluctant to put your money at the \"\"mercy\"\" of one stock, but the criteria you have listed match up with an equity investment, so if you want to meet your goals, you are going to have to come to terms with your fears and buy a stock. Find a good blue chip stock that is in an industry with positive prospects. Stay away from stuff that is sexy or hyped. Focus on just one stock--that way you can research it to death. The better you understand what you are buying, the greater the chance of success. Zurich Financial Services is a very solid company right now in a nice, boring, highly profitable business. Might fit your needs perfectly. They were founded in 1872, one of the safest equities you will find. Nestle is another option. Roche is another. If you want something a little more risky consider Georg Fischer. Anyway, what I can tell you, is that your goals match up with a blue chip equity as the logical type of investment. Note on Diversification Many financial advisors will advise you to \"\"diversify\"\", for example, by investing in many stocks instead of just one, or even by buying funds that are invested in hundreds of stocks, or indexes that are invested in the whole market. I disagree with this philosophy. Would you go into a casino and divide your money, putting a small portion on each game? No, it is a bad idea because most of the games have poor returns. Yet, that is exactly what you do when you diversify. It is a false sense of safety. The proper thing to do is exactly what you would do if forced to bet in casino: find the game with the best return, get as good as you can at that game, and play just that one game. That is the proper and smart thing to do.\"", "title": "" }, { "docid": "3ca2a36926c308393a021d671a4ad8ff", "text": "\"You mentioned three concepts: (1) trading (2) diversification (3) buy and hold. Trading with any frequency is for people who want to manage their investments as a hobby or profession. You do not seem to be in that category. Diversification is a critical element of any investment strategy. No matter what you do, you should be diversified. All the way would be best (this means owning at least some of every asset out there). The usual way to do this is to own a mutual or index fund. Or several. These funds own hundreds or thousands of stocks, so that buying the fund instantly diversifies you. Buy and hold is the only reasonable approach to a portfolio for someone who is not interested in spending a lot of time managing it. There's no reason to think a buy-and-hold portfolio will underperform a typical traded portfolio, nor that the gains will come later. It's the assets in the portfolio that determine how aggressive/risky it is, not the frequency with which it is traded. This isn't really a site for specific recommendations, but I'll provide a quick idea: Buy a couple of index funds that cover the whole universe of investments. Index funds have low expenses and are the cheapest/easiest way to diversify. Buy a \"\"total stock market\"\" fund and a \"\"total bond fund\"\" in a ratio that you like. If you want, also buy an \"\"international fund.\"\" If you want specific tickers and ratios, another forum would be better(or just ask your broker or 401(k) provider). The bogleheads forum is one that I respect where people are very happy to give and debate specific recommendations. At the end of the day, responsibly managing your investment portfolio is not rocket science and shouldn't occupy a lot of time or worry. Just choose a few funds with low expenses that cover all the assets you are really interested in, put your money in them in a reasonable-ish ratio (no one knows that the best ratio is) and then forget about it.\"", "title": "" }, { "docid": "f983c383262bb5e484be57c6f264612e", "text": "In general, the higher the return (such as interest), the higher the risk. If there were a high-return no-risk investment, enough people would buy it to drive the price up and make it a low-return no-risk investment. Interest rates are low now, but so is inflation. They generally go up and down together. So, as a low risk (almost no-risk) investment, the savings account is not at all useless. There are relatively safe investments that will get a better return, but they will have a little more risk. One common way to spread the risk is to diversify. For example, put some of your money in a savings account, some in a bond mutual fund, and some in a stock index fund. A stock index fund such as SPY has the benefit of very low overhead, in addition to spreading the risk among 500 large companies. Mutual funds with a purchase or sale fee, or with a higher management fee do NOT perform any better, on average, and should generally be avoided. If you put a little money in different places regularly, you'll be fairly safe and are likely get a better return. (If you trade back and forth frequently, trying to outguess the market, you're likely to be worse off than the savings account.)", "title": "" }, { "docid": "4565bdd52fc78c636b1dfe90b193e54a", "text": "Start as soon as you can and make your saving routine. Start with whatever you feel comfortable with and be consistent. Increase that amount with raises, income gains, and whenever you want.", "title": "" }, { "docid": "d48668c03c328eebe5c349e9895587fc", "text": "Dollar cost averaging is an great way to diversify your investment risk. There's mainly 2 things you want to achieve when you're saving for retirement: 1) Keep your principal investment; 2) Grow it. The best methods recommended by most financial institutions are as follows: 1) Diversification; 2) Re-balance. There are a lot of additional recommendations, but these are my main take away. When you dollar cost average, you're essentially diversifying your exchange risk between the value of the funds you're investing. Including the ups and downs of the value of the underlying asset, may actually be re-balancing. Picking your asset portfolio: 1) You generally want to include within your 401k or any other invest, classes of investments that do not always move in total correlation as this allows you to diversify risk; 2) I'm making a lot of assumptions here - since you may have already picked your asset classes. Consider utilizing the following to tell you when to buy or sell your underlying investment: 1) Google re-balance excel sheet to find several examples of re-balance tools to help you always buy low and sell high; 2) Enter your portfolio investment; 3) Utilize the movement to invest in the underlying assets based on market movement; and 4) Execute in an emotionless way and stick to your plan. Example - Facts 1) I have 1 CAD and 1 USD in my 401k. Plan I will invest 1 dollar in the ratio of 50/50 - forever. Let's start in 2011 since we were closer to par: 2010 - 1 CAD (value 1 USD) and 1 USD (value 1 USD) = 50/50 ratio 2011 start - 1 CAD ( value .8 USD) and 1 USD (value 1 USD) = 40/60 ratio 2011 - rebalance - invest 1 USD as follows purchase .75 CAD (.60 USD) and purchase .40 USD = total of 1 USD reinvested 2011 end - 1.75 CAD (value 1.4USD) and 1.4 USD (value 1.4 USD) - 50/50 ratio As long as the fundamentals of your underlying assets (i.e. you're not expecting hyperinflation or your asset to approach 0), this approach will always build value over time since you're always buying low and selling high while dollar averaging. Keep in mind it does reduce your potential gains - but if you're looking to max gain, it may mean you're also max potential loss - unless you're able to find A symmetrical investments. I hope this helps.", "title": "" }, { "docid": "a92f7d57341d16580b73939484db1966", "text": "Risk. Volatility. Liquidity. Etc. All exist on a spectrum, these are all comparative measures. To the general question, is a mutual fund a good alternative to a savings account? No, but that doesn't mean it is a bad idea for your to allocate some of your assets in to one right now. Mutual funds, even low volatility stock/bond blended mutual funds with low fees still experience some volatility which is infinitely more volatility than a savings account. The point of a savings account is knowing for certain that your money will be there. Certainty lets you plan. Very simplistically, you want to set yourself up with a checking account, a savings account, then investments. This is really about near term planning. You need to buy lunch today, you need to pay your electricity bill today etc, that's checking account activity. You want to sock away money for a vacation, you have an unexpected car repair, these are savings account activities. This is your foundation. How much of a foundation you need will scale with your income and spending. Beyond your basic financial foundation you invest. What you invest in will depend on your willingness to pay attention and learn, and your general risk tolerance. Sure, in this day and age, it is easy to get money back out of an investment account, but you don't want to get in the habit of taping investments for every little thing. Checking: No volatility, completely liquid, no risk Savings: No volatility, very liquid, no principal risk Investments: (Pick your poison) The point is you carefully arrange your near term foundation so you can push up the risk and volatility in your investment endeavors. Your savings account might be spread between a vanilla savings account and some CDs or a money market fund, but never stock (including ETF/Mutual Funds and blended Stock/Bond funds). Should you move your savings account to this mutual fund, no. Should you maybe look at your finances and allocate some of your assets to this mutual fund, sure. Just look at where you stand once a year and adjust your checking and savings to your existing spending. Savings accounts aren't sexy and the yields are awful at the moment but that doesn't mean you go chasing yield. The idea is you want to insulate your investing from your day to day life so you can make unemotional deliberate investment decisions.", "title": "" } ]	fiqa
58063e03ed1644618fcbe75d66af59cf	I thought student loans didn't have interest, or at least very low interest? [UK]	[ { "docid": "18ee590fcebd7e5ad0f366d50040e2e9", "text": "From the description, you have a post-1998 income contingent loan. The interest rate on those is currently 1.5% but it has varied quite a bit in the last few years due to the formula used to calculate it, which is either the inflation rate (RPI), or 1% + the highest base rate across a group of banks - whichever is smaller. This is indeed really cheap credit compared to any commercial loan you could get, though whether you should indeed just repay the minimum depends on making a proper comparison with the return on any spare money you could get after tax elsewhere. There is a table of previous interest rates. From your description I think you've had the loan for about 4 years - your final year of uni, one year of working without repayments and then two years of repayments. A very rough estimate is that you would have been charged about £300 of interest over that period. So there's still an apparent mismatch, though since both you and I made rough calculations it may be that a more precise check resolves it. But the other thing is that you should check what the date on the statement is. Once you start repaying, statements are sent for a period ending 5th April of each year. So you may well not be seeing the effect of several months of repayments since April on the statement. Finally, there's apparently an online facility you can use to get an up to date balance, though the administration of the loans repaid via PAYE is notoriously inefficient so there may well be a significant lag between a payment being made and it being reflected in your balance, though the effect should still be backdated to when you actually made it.", "title": "" }, { "docid": "d41d8cd98f00b204e9800998ecf8427e", "text": "", "title": "" }, { "docid": "b3acc09fce33e69930d2bf14ced64bb7", "text": "If I recall correctly, the pay schedule is such that you initially pay mostly interest. As James Roth suggests, look at the terms of the loan, specifically the payment schedule. It should detail how much is being applied to interest and how much to the actual balance.", "title": "" } ]	[ { "docid": "508ba9807775aa566286ecb749ae099a", "text": "No offense to any bankers who are reading, but i find it remarkable that they can confuse what I'd expect to be an otherwise simple explanation. If at the end of each day the interest is added, you go to sleep with a new balance. At the moment it's added, you have no interest due, just a higher principal amount than when you went to sleep last night. When I view my loan, I know how much interest added to principal since the last payment. Any amount I pay over that has to go to principal. Forgive me, but the rest sounds like nonsense.", "title": "" }, { "docid": "8143e59701da827051bb11538170aa2e", "text": "Hi guys, have a question from my uni finance course but I’m unsure how to treat the initial loan (as a bond, or a bill or other, and what the face value of the loan is). I’ll post the question below, any help is appreciated. “Hi guys, I have a difficult university finance question that’s really been stressing me out.... “The amount borrowed is $300 million and the term of the debt credit facility is six years from today The facility requires minimum loan repayments of $9 million in each financial year except for the first year. The nominal rate for this form of debt is 5%. This intestest rate is compounded monthly and is fixed from the date the facility was initiated. Assume that a debt repayment of $10 million is payed on 31 August 2018 and $9million on April 30 2019. Following on monthly repayments of $9 million at the end of each month from May 31 2019 to June 30 2021. Given this information determine the outstanding value of the debt credit facility on the maturity date.” Can anyone help me out with the answer? I’ve been wracking my brain trying to decide if I treat it as a bond or a bill.” Thanks in advance,", "title": "" }, { "docid": "c08db17711eb452e35317801bdf55f13", "text": "There is one massive catch in this which I found out when I went to Nationwide to ask for a loan. I've got a credit card which they kept increasing my credit limit, it's now at something ridiculous - nearly £10,000 but they keep increasing it. I never use that card, when I went to Nationwide though they said they couldn't give me a loan because I had £10,000 credit already and if I reduced this credit this would affect my credit rating and they could potentially give me a loan. I then realised what MBNA had craftily done. I have two cards with this bank, one with really low interest and the other with really high interest (and a high credit limit) - even though the other card has a zero balance loan companies still see it as money I could potentially go and spend, it doesn't matter to them that I've not spent any money on that card in about 12 months, to them it's the fact that they could give me a loan and then I could go and spend another £10,000 on that card (as you can see extremely risky). Of course this means that what MBNA are craftily doing is giving me such a high credit, knowing full well that I'm not going to use it, but it also prevents their competitors from offering me a loan, even at a lower rate, because I've already got too much credit available. So yes there is a catch to giving you a high credit limit on your cards and it's to prevent you from either leaving that bank or getting a lower interest rate loan out to clear the debt.", "title": "" }, { "docid": "0e5a6965c3da5746f8f137eb64d7f318", "text": "\"Perhaps people in student loan debt aren't the source of the assessment. There have been multiple warnings from Nobel economists on the potential for student loans to do what the housing market did in 2008. If we suddenly find out a large fraction of the educations loaned weren't worth enough to pay back, many positives on company balance sheets would suddenly appear as negatives. When negatives are realized, it triggers what some economists have termed a \"\"balance-sheet recession\"\": the great depression and 2008 recession both had this mechanism at their heart. They're a special type of recession that are not temporary and take on the order of a decade to crawl out of.\"", "title": "" }, { "docid": "9e480d3236692273886be154a8499ced", "text": "\"I read up on it and saw that the IRS can \"\"charge\"\" the loan provider on interest even if the loan provider doesn't charge interest, but this is normally mitigated by the 0% interest being considered a gift and as long as it's below X amount your fine. Yes, this sums it up. X is the amount of the gift exemption, the $14K. However, you must differ between loan with no interest and loan with no paying back. With loan with no interest you're still giving a statutory gift of the IRS mandated minimum interest. However, the principal is expected to be repaid to you and you must show that this expectation is reasonably fulfilled. If you cannot (i.e.: you gave a \"\"loan\"\" with no intention of it being paid back), then the IRS will recharacterize the whole amount as the gift, and you'll be on the hook for gift tax for the amounts above the exemption. What defines a loan vs a gift in terms of the IRS, is it simply that the loan will be paid back, or is it only considered a loan if a promisary note is made? As I said - you must be able to show that the loan is indeed a loan, even if it is with no interest. I.e.: it is being repaid, it is treated as a loan by all parties, and is not an attempt to evade gift tax. Promissory note is not a must, but will definitely be helpful in showing that. But without the de-facto repayment of the loan, it will be hard to argue that it is not a gift, even if you have a promissory note. That means, you should make a loan in such a way that the borrower will (begin) repaying it reasonably soon, so that you can show payment schedule being followed and money moving back to you. Reasonably soon is not of course defined in a statute, so do consult with a EA/CPA licensed in your state on how to structure the loan so that it will not appear as an attempt to evade the gift tax. Are there any limits on how big a loan can be? No, but keep in mind that even with statutory interest charges (published by the IRS monthly, see the link), with large enough loan you can exceed the gift tax exemption. Also, keep in mind that interest is taxable income to you. Even if you gift it back (i.e.: the statutory interest).\"", "title": "" }, { "docid": "1f69b9b3b61d001e92118515fb873e53", "text": "gnasher729's answer is fundamentally correct and deserves the checkmark, but I'd like to give an economic explanation for how this economically functions. The key point from gnasher729's answer's that the interest rate is 49.9% for one company. While this may be much higher than the equilibrium rate, the true market interest rate, it is not completely unreasonable because of the risk. For credit to be continually produced, default risk must be compensated because this is a cost to the lender. Most are not in business to lose money, so making loans to borrowers that default 40% of the time would make this interest rate reasonable. For UK citizens, this would not be such a problem because the lender can usually pursue the borrower for the balance, but if the borrower can disavow the loan and leave the legal reach of the UK creditors, the collection rate is 0%. The guarantee by the foreign persons not present in the UK is incidental and probably more of a regulatory requirement since the inability to collect from them is just as unlikely. One should always look for the lowest price with at least minimum quality when shopping for anything, but you are right to be apprehensive legally. Read every line and be sure that you yourself understand every clause before signing. If alternative cheaper financing is available, it is probably superior.", "title": "" }, { "docid": "b2ca60e1f757516b41e9fd67b5707998", "text": "At time = 0, no interest has accrued. That's normal. And the first payment is due after a month, when there's a month's interest and a bit of principal due. Note - I missed weekly payments. You'd have to account for this manually, add a month's interest, then calculate based on weekly payments.", "title": "" }, { "docid": "78b8209c5b2239617da310d8d7a2e25a", "text": "\"Most likely that's the amount of interest that accrued on the loan while you were in school. If you had paid that amount before 6/21, you would have just paid off accrued interest and your loan balance would have stayed the same. Since you did not pay the interest, it will be added to your loan balance and you will just pay it off as part of the loan (plus compounded interest). If you pay off your loan at 5% over 30 years (hopefully you won't, but that's what they're amortized for), that $350 will compound and become $1,563. Essentially you're \"\"borrowing\"\" $350 at 5% interest for 30 years. Hopefully that motivates you to pay it off sooner that that...\"", "title": "" }, { "docid": "8543575f0e85210dc6f13f0e98bd79e0", "text": "Paying off the student loans slower and investing the rest has some advantages - the interest is tax deductible (essentially lowering that 7% number), and it helps allow you to build up a liquid emergency fund which is more important to financial security than returns.", "title": "" }, { "docid": "3cafe9fcecfcd58776eaa19019664cb6", "text": "I don't have numbers on that, but I imagine the average student loan is much higher. Stilll, student loans, due to their default-less nature, are a bit of a different beast IMO. I think student loans will put a prolonged drag on the economy, but I really don't see where the catalyst for a crisis would be.", "title": "" }, { "docid": "f92d195707bc8910972f6def5a6b7f6d", "text": "It's important because you may be able to reduce the total amount of interest paid (by paying the loan faster); but you can do nothing to reduce the total of your principal repayments. The distinction can also affect the amount of tax you have to pay. Some kinds of interest payments can be counted as business expenses, which means that they reduce the amount of income you have to pay tax on. But this is not generally the case for money used to repay the loan principal.", "title": "" }, { "docid": "af4c4656175187a75c39d3eddf6c605b", "text": "I also had a student loan and glad you are taking a good look on interest rate as it really makes a huge difference. One of the strategies I followed was since my credit improved as I stepped out of school. I took advantage of a good 0 percent credit card. I applied for discover and got a decent credit limit. There are 2 particular things you are looking for in a credit card in this situation Usually the initial $0 transaction charge is only for a couple of months so ensure you take advantage of that. What is the benefit: Imagine being able to pay off that higher interest rate balance with 0% and not have to worry about it immediately. That way you save on the interest you would be paying and stress as well Watch out for: Although you have to ensure that you do payoff the money you paid through the 0 percent credit card ( which may have been put off for a year or even 15 months or so) other wise you may have to pay it all at once as the offer is expiring. Note: for credit cards ensure to note when the 0% is expiring as that is usually not mentioned on the statement and you may have to call the customer service. I was in a similar situation and was able to pay it all off fairly quickly. I am sure you will as well.", "title": "" }, { "docid": "20dea3b2e4cbbd789235606ea60ee020", "text": "At your age, the only place you are going to get a loan is from relatives. If you can't... Go to next year's conference. Missing it this year might feel like a disaster, but it really, really isn't.", "title": "" }, { "docid": "7b000a97892cc975d572e05f9af9505f", "text": "This is very much possible and happens quite a lot. In the US, for example, promotional offers by credit card companies where you pay no interest on the balance for a certain period are a very common thing. The lender gains a new customer on such a loan, and usually earns money from the spending via the merchant fees (specifically for credit cards, at least). The pro is obviously free money. The con is that this is usually for a short period of time (longest I've seen was 15 months) after which if you're not careful, high interest rates will be charged. In some cases, interest will be charged retroactively for the whole period if you don't pay off the balance or miss the minimum payment due.", "title": "" }, { "docid": "0bcbb94c232d3c08232b50344bfc12be", "text": "The £500 are an expense associated with the loan, just like interest. You should have an expense account where you can put such financing expenses (or should create a new one). Again, treat it the same way you'll treat interest charges in future statements.", "title": "" } ]	fiqa
b9249f78f2e10312a67d190e101058c2	Annuities question - Equations of value	[ { "docid": "c7cf50b1d08c74636ecff24bf8c02aa3", "text": "These are the steps I'd follow: $200 today times (1.04)^10 = Cost in year 10. The 6 deposits of $20 will be one time value calculation with a resulting year 7 final value. You then must apply 10% for 3 years (1.1)^3 to get the 10th year result. You now have the shortfall. Divide that by the same (1.1)^3 to shift the present value to start of year 7. (this step might confuse you?) You are left with a problem needing 3 same deposits, a known rate, and desired FV. Solve from there. (Also, welcome from quant.SE. This site doesn't support LATEX, so I edited the image above.)", "title": "" }, { "docid": "abdd072491ef76018f5ae6da88ba5c38", "text": "The solution is x = 8.92. This assumes that Chuck's six years of deposits start from today, so that the first deposit accumulates 10 years of gain, i.e. 20(1 + 0.1)^10. The second deposit gains nine years' interest: 20(1 + 0.1)^9 and so on ... If you want to do this calculation using the formula for an annuity due, i.e. http://www.financeformulas.net/Future-Value-of-Annuity-Due.html where (formula by induction) you have to bear in mind this is for the whole time span (k = 1 to n), so for just the first six years you need to calculate for all ten years then subtract another annuity calculation for the last four years. So the full calculation is: As you can see it's not very neat, because the standard formula is for a whole time span. You could make it a little tidier by using a formula for k = m to n instead, i.e. So the calculation becomes which can be done with simple arithmetic (and doesn't actually need a solver).", "title": "" } ]	[ { "docid": "09848b9331b52609b3aa51f93f586f3a", "text": "There is always some fine print, read it. I doubt there is any product out there that can guarantee an 8% return. As a counter example - a 70 yr old can get 6% in a fixed immediate annuity. On death, the original premium is retained by the insurance company. Whenever I read the prospectus of a VA, I find the actual math betrays a salesman who misrepresented the product. I'd be really curious to read the details for this one.", "title": "" }, { "docid": "9dee813e8d2ce9340ec2beb8f7d87dfc", "text": "\"An annuity is a product. In simple terms, you hand over a lump sum of cash and receive an agreed annual income until you die. The underlying investment required to reach that income level is not your concern, it's the provider's worry. So there is a huge mount of security to the retiree in having an annuity. It is worth pointing out that with simple annuities where one gives a lump sum of money to (typically) an insurance company, the annuity payments cease upon the death of the annuitant. If any part of the lump sum is still left, that money belongs to the company, not to the heirs of the deceased. Fancier versions of annuities cover the spouse of the annuitant as well (joint and survivor annuity) or guarantee a certain number of payments (e.g. 10-year certain) regardless of when the annuitant dies (payments for the remaining certain term go to the residual beneficiary) etc. How much of an annuity payment the company offers for a fixed lump sum of £X depends on what type of annuity is chosen; usually simple annuities give the maximum bang for the buck. Also, different companies may offer slightly different rates. So, why should one choose to buy an annuity instead of keeping the lump sum in a bank or in fixed deposits (CDs in US parlance), or invested in the stock market or the bond market, etc., and making periodic withdrawals from these assets at a \"\"safe rate of withdrawal\"\"? Safe rates of withdrawal are often touted as 4% per annum in the US, though there are newer studies saying that a smaller rate should be used. Well, safe rates of withdrawal are designed to ensure that the retiree does not use up all the money and is left destitute just when medical bills and other costs are likely to be peaking. Indeed, if all the money were kept in a sock at home (no growth at all), a 4% per annum withdrawal rate will last the retiree for 25 years. With some growth of the lump sum in an investment, somewhat larger withdrawals might be taken in good years, but that 4% is needed even when the investments have declined in value because of economic conditions beyond one's control. So, there are good things and bad things that can happen if one chooses to not buy an annuity. On the other hand, with an annuity, the payments will continue till death and so the retiree feels safer, as Chris mentioned. There is also the serenity in not having to worry how the investments are doing; that's the company's business. A down side, of course, is that the payments are fixed and if inflation is raging, the retiree still gets the same amount. If extra cash is needed one year for unavoidable expenses, the annuity will not provide it, whereas the lump sum (whether kept in a sock or invested) can be drawn on for the extra expense. Another down side is that any money remaining is gone, with nothing left for the heirs. On the plus side, the annuity payments are usually larger than those that the retiree will get via the safe rate of withdrawal method from the lump sum. This is because the insurance company is applying the laws of large numbers: many annuitants will not survive past their life expectancy, and their leftover monies are pure profit to the insurance company, often more than enough (when invested properly by the company) to pay those old codgers who continue to live past their life expectancy. Personally, I wouldn't want to buy an annuity with all my money, but getting an annuity with part of the money is worthwhile. Important: The annuity discussed in this answer is what is sometimes called a single-premium or an immediate annuity. It is purchased at the time of retirement with a single (large) lump sum payment. This is not the kind of annuity that is described in JAGAnalyst's answer which requires payment of (much smaller) premiums over many years. Search this forum for variable annuity to learn about these types of annuities.\"", "title": "" }, { "docid": "85000bed497e6334aa780dbb0d8bbd83", "text": "Annuities, like life insurance, are sold rather than bought. Once upon a time, IRAs inherited from a non-spouse required the beneficiary to (a) take all the money out within 5 years, or (b) choose to receive the value of the IRA at the time of the IRA owner's death in equal installments over the expected lifetime of the beneficiary. If the latter option was chosen, the IRA custodian issued the fixed-term annuity in return for the IRA assets. If the IRA was invested in (say) 15000 shares of IBM stock, that stock would then belong to the IRA custodian who was obligated to pay $x per year to the beneficiary for the next 23 years (say). There was no investment any more that could be transferred to another broker, or be sold and the proceeds invested in Facebook stock (say). Nor was the custodian under any obligation to do anything except pay $x per year to the beneficiary for the 23 years. Financial planners loved to get at this money under the old IRA rules by suggesting that if all the IRA money were taken out and invested in stocks or mutual funds through their company, the company would pay a guaranteed $y per year, would pay more than $y in each year that the investments did well, would continue payment until the beneficiary died (or till the death of the beneficiary or beneficiary's spouse - whoever died later), and would return the entire sum invested (less payouts already made, of course) in case of premature death. $y typically would be a little larger than $x too, because it factored in some earnings of the investment over the years. So what was not to like? Of course, the commissions earned by the planner and the lousy mutual funds and the huge surrender charges were always glossed over.", "title": "" }, { "docid": "481708893828cf324c2970066f90a2ed", "text": "The general concept is that your money will grow at an accelerating rate because you start getting interest paid on your returns in addition to the original investment. As a simple example, assume you invest $100 and get 10% interest per year paid annually. -At the end of the first year you have your $100 + $10 interest for a total of $110. -So you start the second year with $110 and so 10% would be $11 for a total of $121. -The third year you start with $121 so 10% would be $12.10 for a total of $133.10 See how the amount it goes up each year increases? If we were talking a higher initial amount or a larger number of years that can really add up. That is essence is compound interest. Most of the complicated looking formulas you see out there for compound interest are just shortcuts so you don't have to iteratively go through the above exercise a bunch of times to find out how much you would have after some number of years. This formula tells you how much you would have(A) after a certain number of years(t) at a given interest rate(r) assuming they pay interest n times per year, for example you would use 12 for n if it paid interest monthly instead of yearly. P represents the amount you started out with. If you keep investing monthly (as shown in your example) instead of just depositing it and letting it sit, you have to use a more complicated formula. Finance people refer to this as calculating the future value of an annuity. That formula looks like this: A = PMT [((1 + r)N - 1) / r] x (1+r) A : Is the amount you would have at the end of the time period. N : The number of compounding periods (months if you get interest calculated monthly) PMT : The total amount you are putting in each period (N) r: Just like before, the interest rate you are getting paid. Be sure to adjust this to a monthly number if N represents months (divide APR by 12)* Most interest rates are quoted as APR, which is the annualized interest rate not counting compounding. Don't confuse this with APY, which has compounding built into it and is not appropriate for use in this formula. Inserting your example: r (monthly interest rate) = 15% APR / 12 = .0125 n = 30 years 12 months/year = 360 months A = $150 x [((1 + .0125)360 - 1) / .0125] x (1+.0125) A = $1,051,473.09 (rounded)", "title": "" }, { "docid": "24968d889f8165acac29fd0adf07240e", "text": "\"The extent that you would have problems would depend on if the annuity is considered Qualified or Non-Qualified. If the annuity is qualified that means that the money that was put into it has never been taxed and a rollover to an IRA is simple. The possible issues here are tax issues and a CPA is likely the best person to answer this question. Two other things to consider in such an event is the loss of any 'living benefit' or 'death benefit'. Variable annuities have been through quite the evolution in the last 15 years. Death benefits have been around longer than living benefits but both are usually based on some derrivitive of a 'high water' mark of the variable sub accounts. You might want to ask Hartford the question \"\"...how will my living or death benefits be affected if I roll this over\"\".\"", "title": "" }, { "docid": "9f38bd0a46bf85a3c29ba74acc1ff4e3", "text": "\"Sometimes an assumptions is so fundamentally flawed that it essentially destroys the relevance and validity of any modelling outputs. \"\"Obviously, we're assuming the company can pay it back\"\" Is one of those assumptions. The person gets a notes stating that they will get $525 'IN ONE YEAR' You need to divide $525/(1+Cost of Capital)^n n being the number of periods to find out what the note will be worth today. Google 'Present Value of an Annuity' to deal with debt that is more complex than you have $500 now and give me $525 in a year...\"", "title": "" }, { "docid": "f33e67e30613c29876555d2a8cce0588", "text": "\"An index annuity is almost the same as Indexed Universal Life, except the equity-index annuity is an investment with a guaranteed minimum return, with sometimes a higher return that is a function of the gain in the stock market, but is not associated with a life insurance policy. After a time, you can convert the EIA to a lifetime income (the annuity part) or just cash it out. They often are very complicated, but are constructed by combining bonds with index options (puts) just like indexed universal life. Unfortunately these tend to have high fees and/or commissions, and high (early) surrender charges, which can make them a poor investment. Of course you could just \"\"roll your own\"\" by buying bonds and puts FINRAS bulletin on EIAs, pdf warning. Here's a description of one of these securities: pdf.\"", "title": "" }, { "docid": "25c349cec0a4b8347e29078653079818", "text": "Let's break this into two parts, the future value of the initial deposit, and the future value of the payments: D(1 + i)n For the future value of the payments A((1+i)n-1) / i) Adding those two formulas together will give you the amount of money that should be in your account at the end. Remember to make the appropriate adjustments to interest rate and the number of payments. Divide the interest rate by the number of periods in a year (four for quarterly, twelve for monthly), and multiply the number of periods (p) by the same number. Of course the monthly deposit amount will need to be in the same terms. See also: Annuity (finance theory) - Wikipedia", "title": "" }, { "docid": "77f2fb35a2beff9e1f1c485393fb6fd7", "text": "\"Hey guys I have a quick question about a financial accounting problem although I think it's not really an \"\"accounting\"\" problem but just a bond problem. Here it goes GSB Corporation issued semiannual coupon bonds with a face value of $110,000 several years ago. The annual coupon rate is 8%, with two coupons due each year, six months apart. The historical market interest rate was 10% compounded semiannually when GSB Corporation issued the bonds, equal to an effective interest rate of 10.25% [= (1.05 × 1.05) – 1]. GSB Corporation accounts for these bonds using amortized cost measurement based on the historical market interest rate. The current market interest rate at the beginning of the current year on these bonds was 6% compounded semiannually, for an effective interest rate of 6.09% [= (1.03 × 1.03) – 1]. The market interest rate remained at this level throughout the current year. The bonds had a book value of $100,000 at the beginning of the current year. When the firm made the payment at the end of the first six months of the current year, the accountant debited a liability for the exact amount of cash paid. Compute the amount of interest expense on these bonds for the last six months of the life of the bonds, assuming all bonds remain outstanding until the retirement date. My question is why would they give me the effective interest rate for both the historical and current rate? The problem states that the firm accounts for the bond using historical interest which is 10% semiannual and the coupon payments are 4400 twice per year. I was just wondering if I should just do the (Beginning Balance (which is 100000 in this case) x 1.05)-4400=Ending Balance so on and so forth until I get to the 110000 maturity value. I got an answer of 5474.97 and was wondering if that's the correct approach or not.\"", "title": "" }, { "docid": "c883abf8ed36a71a6c5a99486ff7e32f", "text": "\"Be very careful about terminology when talking about annuities. You used the phrase \"\"4% return\"\" in your question. What exactly do you mean by that? An annuity that pays out 4% of its principle is not giving you a \"\"4% return\"\" in the sense of ROI, because most of that was your money to begin with. But to achieve a true 4% return in the current environment where interest rates are at historic lows on anything safe (10 year UK Gilts at 0.91%) would make me very nervous about what the insurance company is investing my annuity in.\"", "title": "" }, { "docid": "2bff6cd7047ca4577a71b8922e71219c", "text": "First let's define some terms. Your accrued benefit is a monthly benefit payable at your normal retirement age (usually 65). It is usually a life-only benefit but may have a number of years guaranteed or may have a survivor piece. It is defined by a plan formula (ie, it is a defined benefit). A lump sum is how much that accrued benefit is worth right now. Lump sums are based on applicable interest rates and mortality tables specified by the IRS (interest rates are released monthly, mortality annually). Your plan can either use the same interest rates for a whole year, or they can use new ones each month. Affecting your lump sum is whether your accrued benefit is payable now (immediately, you are age 65), or later (deferred, you are now age 30). For example, instead of being paid an annuity assume you are paid just one payment of $1,000 on your 65th birthday. The lump sum of that for a 65 year old would be $1,000 since there would be no interest discount, and no chance of dying before payment. For a 30 year old, at 4% interest the lump sum would be about $237 (including mortality discount). At age 36 the lump sum is $246. So the lump sum will get bigger just because you get older. Very important is the interest discount. At age 30 in the example, 2% interest would produce a $467 lump sum. And at 6% $122. The bigger the rate, the smaller the lump sum because interest helps an amount now grow bigger in the future. To complicate things, since 2008 the IRS bases lump sums on 3 different interest rates. The monthy annuity payments made within 5 years of the lump sum date use the 1st rate, past 5 and within 20 years use the 2nd rate, and past that use the 3rd rate. Since you are age 30, all of your monthly annuity payments would be made after 20 years, so that makes it simple since we'll only have to look at the 3rd rate. When you reach age 45 the 2nd rate will kick in. Here is the table of interest rates published by the IRS: http://www.irs.gov/Retirement-Plans/Minimum-Present-Value-Segment-Rates You'll find your rates above on the 2013 line for Aug-12. That means your lump sum is being made in 2013 and it is being based on the month August 2012. Most likely your plan will use the same rates for its entire plan year. But what is your plan year? If it is the calendar year, then you would have a 5 month lookback for the rates. But if is a September to August plan year with a 1 month lookback, the rates would have changed between August and September. Your August lump sum would be based on 4.52%, your September on would be based on 5.58% (see the All line for Aug-13). For comparison, a 30 year old with a $100 annuity payable at age 65 would have a lump sum value of $3,011 at 4.52%, but a lump sum value of $1,931 at 5.58%. The change in your accrued benefit by month will obviously have some impact on the lump sum value, but not as much as the change in interest rates if there is one. The amount they actually contribute to the plan has nothing to do with the value of the lump sum though.", "title": "" }, { "docid": "0a476021c07a157a45dea1b455012954", "text": "Beware of surrender charges also Surrender Charges Many annuities will impose a surrender charge if the annuity is cashed in before a specific period of time. That period may run anywhere from 1 to 12 years. A typical surrender charge is one that starts at 7% in the first year of the contract, and declines by 1% per year thereafter until it reaches zero. The charge is made against the value of the investment when the annuity is surrendered, and its purpose (other than simply to make money for the insurance company) is to discourage a short-term investment by the purchaser. For that reason, an annuity should always be considered a long-term investment. In the typical fixed annuity, though, this charge will not apply provided no more than 10% of the investment is withdrawn per year. source: http://www.fool.com/retirement/annuities/annuities02.htm If you've held it for 10 years as you claim, you may not owe any or much in surrender charges, but you definitely want to know what the situation is before you make a move.", "title": "" }, { "docid": "fdb012344bb1443fc5a22c7647a6ca73", "text": "\"There is no equation. Only data that would help you come to the decision that's right for you. Assuming the 401(k) is invested in a stock fund of one sort or another, the choice is nearly the same as if you had $5K cash to either invest or pay debt. Since stock returns are not fixed, but are a random distribution that somewhat resembles a bell curve, median about 10%, standard deviation about 14%. It's the age old question of \"\"getting a guaranteed X% (paying the debt) or a shot at 8-10% or so in the market.\"\" This come up frequently in the decision to pre-pay mortgages at 4-5% versus invest. Many people will take the guaranteed 4% return vs the risk that comes with the market. For your decision, the 401(k) loan, note that the loan is due if you separate from the company for whatever reason. This adds an additional layer of risk and another data point to the mix. For your exact numbers, the savings is barely $50. I'd probably not do it. If the cards were 18%, I'd lean toward the loan, but only if I knew I could raise the cash to pay it back to not default.\"", "title": "" }, { "docid": "84285f1c7b71bb6ca3ea25892aa61c50", "text": "With the formula you are using you assume that the issued bond (bond A) is a perpetual. Given the provided information, you can't really do more than this, it's only an approximation. The difference could be explained by the repayment of the principal (which is not the case with a perpetual). I guess the author has calculated the bond value with principal repayment. You can get more insight in the calculation from the excel provided at this website: http://breakingdownfinance.com/finance-topics/bond-valuation/fixed-rate-bond-valuation/", "title": "" }, { "docid": "fceae85b48ddff092e9d08092eecabbd", "text": "You need to see that prospectus. I just met with some potential new clients today that wanted me to take a look at their investments. Turns out they had two separate annuities. One was a variable annuity with Allianz. The other was with some company named Midland Insurance (can't remember the whole name). Turns out the Allianz VA has a 10 year surrender contract and the Midland has a 14 year contract. 14 years!!! They are currently in year 7 and if they need any money (I'm hoping they at least have a 10% free withdrawal) they will pay 6% surrender on the Allianz and a 15% surrender on the other. Ironically enough, they guy who sold this to them is now in jail. No joke.", "title": "" } ]	fiqa
ea2eb9694ca16cf876adf8dcd57c4b99	Where can you find dividends for Australian Stock Market Shares (ASX) for more than 2 years of data?	[ { "docid": "46651b3b3476d6ee2c361efaaa80b1bb", "text": "It's difficult to compile free information because the large providers are not yet permitted to provide bulk data downloads by their sources. As better advertising revenue arrangements that mimic youtube become more prevalent, this will assuredly change, based upon the trend. The data is available at money.msn.com. Here's an example for ASX:TSE. You can compare that to shares outstanding here. They've been improving the site incrementally over time and have recently added extensive non-US data. Non-US listings weren't available until about 5 years ago. I haven't used their screener for some years because I've built my own custom tools, but I will tell you that with a little PHP knowledge, you can build a custom screener with just a few pages of code; besides, it wouldn't surprise me if their screener has increased in power. It may have the filter you seek already conveniently prepared. Based upon the trend, one day bulk data downloads will be available much like how they are for US equities on finviz.com. To do your part to hasten that wonderful day, I recommend turning off your adblocker on money.msn and clicking on a worthy advertisement. With enough revenue, a data provider may finally be seduced into entering into better arrangements. I'd much rather prefer downloading in bulk unadulterated than maintain a custom screener. money.msn has been my go to site for mult-year financials for more than a decade. They even provide limited 10-year data which also has been expanded slowly over the years.", "title": "" }, { "docid": "63980f924fc504831cdf2dbc4767afaf", "text": "Yahoo provides dividend data from their Historical Prices section, and selecting Dividends Only, along with the dates you wish to return data for. Here is an example of BHP's dividends dating back to 1998. Further, you can download directly to *.csv format if you wish: http://real-chart.finance.yahoo.com/table.csv?s=BHP.AX&a=00&b=29&c=1988&d=06&e=6&f=2015&g=v&ignore=.csv", "title": "" }, { "docid": "0162475cb71c9108de8af43ba39eadb1", "text": "You can register with an online broker. You can usually join most online brokers for free and only have to fund your account if you decide to place a trade. You may also check out the website of the actual companies you are interested in. They will provide current and historic data of the company's financials. For BHP you can click on the link at the bottom of this webpage to get a PDF file of past dividends from 1984.", "title": "" } ]	[ { "docid": "28fd1acdbc2eb2164ba1402e0d88a13a", "text": "There are dividend newsletters that aggregate dividend information for interested investors. Other than specialized publications, the best sources for info are, in my opinion:", "title": "" }, { "docid": "148fe3c6b836d3b733d3f1f75a6f917a", "text": "\"In the case of a specific fund, I'd be tempted to get get an annual report that would disclose distribution data going back up to 5 years. The \"\"View prospectus and reports\"\" would be the link on the site to note and use that to get to the PDF of the report to get the data that was filed with the SEC as that is likely what matters more here. Don't forget that mutual fund distributions can be a mix of dividends, bond interest, short-term and long-term capital gains and thus aren't quite as simple as stock dividends to consider here.\"", "title": "" }, { "docid": "66c2e069c3503182b76c10aac73e22e5", "text": "Thanks to the other answers, I now know what to google for. Frankfurt Stock Exchange: http://en.boerse-frankfurt.de/equities/newissues London Stock Exchange: http://www.londonstockexchange.com/statistics/new-issues-further-issues/new-issues-further-issues.htm", "title": "" }, { "docid": "792e994786ab815266aae52e7b5afef9", "text": "The $500 minimum is a policy of the ASX. As such any broker that offered a different policy would not be offering direct purchase of exchange traded shares. Note however that this policy applies only to the initial purchase. From the CMC FAQs: The ASX requires a minimum parcel of $500 to be traded if you don’t currently hold that particular security. Once you have $500 worth of an individual security, you can purchase any value of shares you like.", "title": "" }, { "docid": "4f56dc0dde85854100d177a5e5998e66", "text": "\"Determine which fund company issues the fund. In this case, a search reveals the fund name to be Vanguard Dividend Growth Fund from Vanguard Funds. Locate information for the fund on the fund company's web site. Here is the overview page for VDIGX. In the fund information, look for information about distributions. In the case of VDIGX, the fourth tab to the right of \"\"Overview\"\" is \"\"Distributions\"\". See here. At the top: Distributions for this fund are scheduled Semi-Annually The actual distribution history should give you some clues as to when. Failing that, ask your broker or the fund company directly. On \"\"distribution\"\" vs. \"\"dividend\"\": When a mutual fund spins off periodic cash, it is generally not called a \"\"dividend\"\", but rather a \"\"distribution\"\". The terminology is different because a distribution can be made up of more than one kind of payout. Dividends are just one kind. Capital gains, interest, and return of capital are other kinds of cash that can be distributed. While cash is cash, the nature of each varies for tax purposes and so they are classified differently.\"", "title": "" }, { "docid": "eec00fac4023bd89d4a52ab034993c41", "text": "If you want to go far upstream, you can get mutual fund NAV and dividend data from the Nasdaq Mutual Fund Quotation Service (MFQS). This isn't for end-users but rather is offered as a part of the regulatory framework. Not surprisingly, there is a fee for data access. From Nasdaq's MFQS specifications page: To promote market transparency, Nasdaq operates the Mutual Fund Quotation Service (MFQS). MFQS is designed to facilitate the collection and dissemination of daily price, dividends and capital distributions data for mutual funds, money market funds, unit investment trusts (UITs), annuities and structured products.", "title": "" }, { "docid": "1c06d4979519343b62cea20210071cd7", "text": "It depends on the exact level of risk that you want, but if you want to keep your risk close to zero you're pretty much stuck with the banks (and those rates don't look to be going up any time soon). If you're willing to accept a little more risk, you can invest in some index tracking ETFs instead, with the main providers in Australia being Vanguard, Street State and Betashares. A useful tool for for an overview of the Australian ETF market is offered by StockSpot. The index funds reduce your level of risk by investing in an index of the market, e.g. the S&P 200 tracked by STW. If the market as a whole rises, then your investment will too, even though within that index individual companies will rise and fall. This limits your potential rate of return as well, and is still significantly more risky than leaving your cash in an Aussie bank (after all, the whole market can fall), but it might strike the right balance for you. If you're getting started, HSBC, Nabtrade, Commsec and Westpac were all offering a couple of months of free trades up to a certain value. Once the free trades are done, you'll do better to move to another broker (you can migrate your shares to the others to take advantage of their free trades too) or to a cheaper broker like CMC Markets.", "title": "" }, { "docid": "f2b2cd5d67aa4c7040942dcefbcbc302", "text": "The biggest issue with Yahoo Finance is the recent change to the API in May. The data is good quality, includes both dividend/split adjusted and raw prices, but it's much more difficult to pull the data with packages like R quantmod than before. Google is fine as well, but there are some missing data points and you can't unadjust the prices (or is it that they're all unadjusted and you can't get adjusted? I can't recall). I use Google at home, when I can't pull from Bloomberg directly and when I'm not too concerned with accuracy. Quandl seems quite good but I haven't tried them. There's also a newer website called www.alphavantage.co, I haven't tried them yet either but their data seems to be pretty good quality from what I've heard.", "title": "" }, { "docid": "b68a08ae762146bd2022814306162a4a", "text": "\"Random question: are there any companies with \"\"physical,\"\" \"\"real,\"\" or \"\"in-kind\"\" dividends? For clarification, suppose a winery offers a security with a dividend of X bottles of wine deliverable annually for every Y amount of shares owned. Does such a company or practice exist?\"", "title": "" }, { "docid": "d6785de13ddb0dbb31dddee8e6ca16c9", "text": "Reuters has a service you can subscribe to that will give you lots of Financial information that is not readily available in common feeds. One of the things you can find is the listing/delist dates of stocks. There are tools to build custom reports. That would be a report you could write. You can probably get the data for free through their rss feeds and on their website, but the custom reports is a paid feature. FWIW re-listing(listings that have been delisted but return to a status that they can be listed again) is pretty rare. And I can not think of too many(any actually) penny stocks that have grown to be listed on a major exchange.", "title": "" }, { "docid": "f28f50d44f6bb36c97ceb1f8fd233f50", "text": "You should not buy soley for the dividend. The price of BHP is going down for a reason. If you hold until the full years dividend is paid you will make 11% (which is $110 if you bought $1000 worth of shares), but if the share price keeps dropping, you might lose 50% on the stock. So you make $110 on dividends but lose $500 on stock price drop. A perfect way to lose money.", "title": "" }, { "docid": "5a4a9d5252e6accab3df197c05881df3", "text": "If you are looking for a European financials ETF to short, you could take a look at the iShares EURO STOXX Banks, which is traded on a a few German stock exchanges (Frankfurt etc.): iShares Euro Stoxx Banks Website You find its current holdings here: holdings.", "title": "" }, { "docid": "2229df26d0604672093af0428f8b7c9a", "text": "I found a possible data source. It offers fundamentals i.e. the accounting ratios you listed (P/E, dividend yield, price/book) for international stock indexes. International equity indices based on EAFE definitions are maintained by Professor French of French-Fama fame, at Dartmouth's Tuck Business School website. Specifics of methodology, and countries covered is available here. MSCI is the data source. Historical time interval for most countries is from 1975 onward. (Singapore was one of the countries included). Obtaining historical ratios for international stock indices is not easily found for free. Your question didn't specify free though. If that is not a constraint, you may wish to check the MSCI Barra international stock indices also.", "title": "" }, { "docid": "fb67ec3740545851f323621075d7a83c", "text": "There are about 250 trading days in a year. There are also about 1,900 stocks listed on the NYSE. What you're asking for would require about 6.2M rows of data. Depending on the number of attributes you're likely looking at a couple GB of data. You're only getting that much information through an API or an FTP.", "title": "" }, { "docid": "92f0b60388d535a8b24ec5ee5eac7417", "text": "\"Take a look at FolioFN - they let you buy small numbers of shares and fractional shares too. There is an annual fee on the order of US$100/year. You can trade with no fees at two \"\"windows\"\" per day, or at any time for a $15 fee. You are better off leaving the stock in broker's name, especially if you live overseas. Otherwise you will receive your dividends in the form of cheques that might be expensive to try to cash. There is also usually a fee charged by the broker to obtain share certificates instead of shares in your account.\"", "title": "" } ]	fiqa
3b84f06c0da75b6aaa396aaa5f24c630	Take car loan out of mortgage to improve equity	[ { "docid": "a464db56677e917c855023850fd8eae6", "text": "\"I guess I don't understand how you figure that taking out a car loan for $20k will result in adding $20k in equity. A car loan is a liability, not an asset like your $100k in cash. Besides, you don't get a dollar-for-dollar consideration when figuring a car's value against the loan it is encumbered by. In other words, the car is only worth what someone's willing to pay for it, not what your loan amount on it is. Remember that taking on a loan will increase your debt-to-income ratio, which is always a factor when trying to obtain a mortgage. At the same time, taking on new debt just prior to shopping for a mortgage could make it more difficult to find a lender. Every time a credit report (hard inquiry) is run on you, it temporarily impacts your credit score. The only exception to this rule is when it comes to mortgages. In the U.S., the way it works is that once you start shopping for a mortgage with lenders, for the next 30 days, additional inquiries into your credit report for purposes of mortgage funding do not count against your credit score, so it's a \"\"freebie\"\" in a way. You can't use this to shop for any other kind of credit, but the purpose is to allow you a chance to shop for the best mortgage rate you can get without adversely impacting your credit. In the end, my advice is to stop looking at how much house you can buy, and instead focus on a house with payments you can live with and afford. Trying to buy the most house based on what someone's willing to lend you leaves no room in the near-term for being able to borrow if the property has some repair needs, you want to furnish/upgrade it, or for any other unanticipated need which may arise that requires credit. Don't paint yourself into a corner. Just because you can borrow big doesn't mean you should borrow big. I hope this helps. Good luck!\"", "title": "" } ]	[ { "docid": "00b942c2c519c366c1b16d4f8def4503", "text": "Is she entitled to more of the equity because she made more? No. Equity should be determined by how much each paid. But she is entitled to more of the equity if she paid more. And that may be what she is saying. That she contributed more to the household's finances than you did. If you always paid the mortgage out of the joint account, you could presumably go back and look at the account to find out how much each of you contributed to it. That would give you a reasonable split for the remainder of the equity after your initial investment. If you both put your entire paychecks into the joint account every time, then it will be the same as the ratio of what you each made. That would also make sense for splitting up whatever remains in that account. While you're doing that, you may want to ask for more for your original $65,000. By my calculation, if your mortgage was 3.5%, that $65,000 saved the household more than $12,000 in interest that became equity instead. So you could reasonably bump your return on the initial investment up to $77,000 while making the concession on the rest of the equity. This is just a suggestion for a framework for splitting the equity. If you can agree on a split, it will almost certainly be easier than going to a mediator or court.", "title": "" }, { "docid": "4f7d9c6d9bd9a85810ebab48a59bacba", "text": "Because a paying down a liability and thus gaining asset equity is not technically an expense, GnuCash will not include it in any expense reports. However, you can abuse the system a bit to do what you want. The mortgage payment should be divided into principle, interest, and escrow / tax / insurance accounts. For example: A mortgage payment will then be a split transaction that puts money into these accounts from your bank account: For completeness, the escrow account will periodically be used to pay actual expenses, which just moves the expense from escrow into insurance or tax. This is nice so that expenses for a month aren't inflated due to a tax payment being made: Now, this is all fairly typical and results in all but the principle part of the mortgage payment being included in expense reports. The trick then is to duplicate the principle portion in a way that it makes its way into your expenses. One way to do this is to create a principle expense account and also a fictional equity account that provides the funds to pay it: Every time you record a mortgage payment, add a transfer from this equity account into the Principle Payments expense account. This will mess things up at some level, since you're inventing an expense that does not truly exist, but if you're using GnuCash more to monitor monthly cash flow, it causes the Income/Expense report to finally make sense. Example transaction split:", "title": "" }, { "docid": "ff0b15f9cbb3b8000b376045467a9566", "text": "As for refinancing: Many institutions charge up-front fees when doing any type of vehicle loan. Typically this is in the neighborhood of 1% the value of the loan, with a floor of $100 (although this may vary by lender). However, for the loan the be secured by the vehicle, the principle value must be less than the collateral value. In your case, this means there is a collateral shortfall of $4,000. When working with a traditional bank, you would have two options: pay the difference up front (reducing the principle value of the loan), or obtaining a separate loan for the difference. This separate loan would often have a higher interest rate unless you have some other form of collateral to secure it with. I doubt CarMax would do a separate loan. All that being said, if you plan on selling the vehicle within the next twelves months, don't bother refinancing. It won't be worth the hassle.", "title": "" }, { "docid": "6278cee56a5973aae9cec2d8328fb568", "text": "\"Generally, when you own something - you can give it as a collateral for a secured loan. That's how car loans work and that's how mortgages work. Your \"\"equity\"\" in the asset is the current fair value of the asset minus all your obligations secured by it. So if you own a property free and clear, you have 100% of its fair market value as your equity. When you mortgage your property, banks will usually use some percentage loan-to-value to ensure they're not giving you more than your equity now or in a foreseeable future. Depending on the type and length of the loan, the LTV percentage varies between 65% and 95%. Before the market crash in 2008 you could even get more than 100% LTV, but not anymore. For investment the LTV will typically be lower than for primary residence, and the rates higher. I don't want to confuse you with down-payments and deposits as it doesn't matter (unless you're in Australia, apparently). So, as an example, assume you have an apartment you rent out, which you own free and clear. Lets assume its current FMV is $100K. You go to a bank and mortgage the apartment for a loan (get a loan secured by that apartment) at 65% LTV (typical for condos for investment). You got yourself $65K to buy another unit free and clear. You now have 2 apartments with FMV $165K, your equity $100K and your liability $65K. Mortgaging the new unit at the same 65% LTV will yield you another $42K loan - you may buy a third unit with this money. Your equity remains constant when you take the loan and invest it in the new purchase, but the FMV of your assets grows, as does the liability secured by them. But while the mortgage has fixed interest rate (usually, not always), the assets appreciate at different rates. Now, lets be optimistic and assume, for the sake of simplicity of the example, that in 2 years, your $100K condo is worth $200K. Voila, you can take another $65K loan on it. The cycle goes on. That's how your grandfather did it.\"", "title": "" }, { "docid": "65f8af4a4f42bc4a9e99a59ac89a5072", "text": "Use the $11k to pay down either car loan (your choice). You should be able to clear one loan very quickly after that lump sum. After that, continue to aggressively pay down the other car loan until it is clear. Lastly, pay off the mortgage while making sure you are financially stable in other areas (cash-on-hand, retirement, etc) Reasoning: The car loans are very close in value, making it a wash as far as payoff speed. The 2.54% interest is not a large factor here. As a percentage of all these numbers, the few bucks a month isn't going to change your financial situation. This is assuming you will pay off both loans well ahead of schedule, making the interest rate negligible in the answer. Paying off the mortgage last is due to the risk associated with the car loans. The cars are guaranteed to lose value at an alarming rate. While a house certainly may lose value, it is far from an expectation. It is likely that your house will maintain and/or increase in value, unless you have specific circumstances not disclosed here. This makes the mortgage a lower risk loan in your financial world. You can probably sell the house to clear the loan balance if necessary. The cars are far more likely to depreciate beyond the loan balance.", "title": "" }, { "docid": "e401a8ff82d95f592eab06973e952461", "text": "While this question is old and I generally agree with the answers given I think there's another angle that needs a little illuminating: insurance. If you go with an 84 month loan your car will likely be worth less than the amount owed for substantially all of the entire 84 month loan period; this will be exacerbated if you put zero down and include the taxes and fees in the amount borrowed. Your lender will require you to carry full comprehensive/collision/liability coverage likely with a low maximum deductible. While the car is underwater it will probably also be a good idea to carry gap insurance because the last thing you want to do is write a check to your lender to shore up the loan to value deficit if the thing is totaled. These long term car loans (I've seen as high as 96 months) are a bear when it comes to depreciation and related insurance costs. There is more to this decision than the interest calculation. Obviously, if you had the cash at the front of this decision presumably you'll have the cash later to pay off the loan at your convenience. But while the loan is outstanding there are costs beyond interest to consider.", "title": "" }, { "docid": "135246342e574893cdb60e72c6d50bf5", "text": "\"Numbers: Estimate you still owe around 37000 (48500 - 4750, 5% interest, 618 per month payment). Initial price, down payment, payments made - none of these mean anything. Ask your lender, \"\"What is the payoff of the current loan?\"\" Next, sell or trade the current vehicle. Compare to the amount owed. Any shortfall has to be repaid, out of pocket, or in some cases added to the price of the new car and included in the principal of the new loan. You cannot calculate how much you still owe the way you have, because it totally ignores interest. Advice on practicality: Don't do this. You will be upside down even worse on the new car from the instant you drive off the lot. Sell the current vehicle, find a way to pay the difference - one that doesn't involve financing. Cut your losses on the upside down vehicle. Then purchase a new vehicle. I'm in the \"\"Pay cash for gently used\"\" school, YMMV. Another option is to go to your bank. Refinance your car now to get a lower interest rate. Pay as much of the principal as you can. Keep that car until it is paid off. Then you will not be upside down. If you're asking how to use the estimator on the webpage. Put the payoff in the downpayment as a negative and the trade in value in the trade in spot. Expect the payment to go up significantly. Another opinion that might be practical advice. Nothing we say here will convince your financially responsible spouse that this is a good idea.\"", "title": "" }, { "docid": "348332ebd12750fb19b0752caded06c2", "text": "\"If I were you I would pay off these loans today. Here are the reasons why I would do this: Car Loan For car loans in particular, it's much better to not pay interest on a loan since cars lose value over time. So the longer you hold the debt, the more you end up paying in interest as the car continues to lose value. This is really the opposite of what you want to do in order to build wealth, which is to acquire assets that gain value over time. I would also recommend that once you pay the loan, that you set aside the payment you used to make on the loan as savings for your next car. That way, you will be able to pay cash for your next car, avoiding thousands of dollars of interest. You will also be able to negotiate a better price by paying cash. Just by doing this you will be able to either afford to buy a nicer car with the same amount of money, or to put the extra money toward something else. Student Loan For the student loan, 3% is a very low rate historically. However, the reason I would still pay these off is that the \"\"return\"\" you are getting by doing so is completely risk free. You can't often get this type of return from a risk-free investment instrument, and putting money in the stock market carries risk. So to me, this is an \"\"easy\"\" way to get a guaranteed return on your money. The only reason I might not pay this down immediately is if you have any other debt at a rate higher than 3%. General Reasons to Get out of Debt Overall, one of the basic functions of lifetime financial planning is to convert income into assets that produce cash flow. This is the reason that you save for retirement and a house, so that when your income ends when you're older these assets will produce cash, or in the case of the house, that you will no longer have to make rent payments. Similarly, paying off these debts creates cash flow, as you no longer have to make these payments. It also reduces your overall financial risk, as you'd need less money to live on if you lost your job or had a similar emergency (you can probably reduce your emergency fund a bit too). Discharging these loans will also improve your debt-to-income ratio if you are thinking of buying a house soon. I wonder whether as someone who's responsible with money, the prospect of cutting two large checks feels like \"\"big spending\"\" to you, even though it's really a prudent thing to do and will save you money. However, if you do pay these off, I don't think you'll regret it.\"", "title": "" }, { "docid": "b2f2dc9071e084e677614bd296b2ff87", "text": "It depends on your tax rate. Multiply your marginal rate (including state, if applicable) by your 3.1% to figure out how much you are saving through the deduction, then subtract that from the 3.1% to get the effective rate on the mortgage. For example, if you are in the 28% bracket with no state tax impact from the mortgage, your effective rate on the mortgage is 2.232%. This also assumes you'd still itemize deductions without the mortgage, otherwise, the effective deduction is less. Others have pointed out more behavioral reasons for wanting to pay off the car first, but from a purely financial impact, this is the way to analyze it. This is also your risk-free rate to compare additional investing to (after taking into account taxes on investments).", "title": "" }, { "docid": "6a30438a8e0fe678ad8874732fadef31", "text": "In short, your scenario could work in theory, but is not realistic... Generally speaking, you can borrow up to some percentage of the value of the property, usually 80-90% though it can vary based on many factors. So if your property currently has a value of $100k, you could theoretically borrow a total of $80-90k against it. So how much you can get at any given time depends on the current value as compared to how much you owe. A simple way to ballpark it would be to use this formula: (CurrentValue * PercentageAllowed) - CurrentMortgageBalance = EquityAvailable. If your available equity allowed you to borrow what you wanted, and you then applied it to additions/renovations, your base property value would (hopefully) increase. However as other people mentioned, you very rarely get a value increase that is near what you put into the improvements, and it is not uncommon for improvements to have no significant impact on the overall value. Just because you like something about your improvements doesn't mean the market will agree. Just for the sake of argument though, lets say you find the magic combination of improvements that increases the property value in line with their cost. If such a feat were accomplished, your $40k improvement on a $100k property would mean it is now worth $140k. Let us further stipulate that your $40k loan to fund the improvements put you at a 90% loan to value ratio. So prior to starting the improvements you owed $90k on a $100k property. After completing the work you would owe $90k on what is now a $140k property, putting you at a loan to value ratio of ~64%. Meaning you theoretically have 26% equity available to borrow against to get back to the 90% level, or roughly $36k. Note that this is 10% less than the increase in the property value. Meaning that you are in the realm of diminishing returns and each iteration through this process would net you less working capital. The real picture is actually a fair amount worse than outlined in the above ideal scenario as we have yet to account for any of the costs involved in obtaining the financing or the decreases in your credit score which would likely accompany such a pattern. Each time you go back to the bank asking for more money, they are going to charge you for new appraisals and all of the other fees that come out at closing. Also each time you ask them for more money they are going to rerun your credit, and see the additional inquires and associated debt stacking up, which in turn drops your score, which prompts the banks to offer higher interest rates and/or charge higher fees... Also, when a bank loans against a property that is already securing another debt, they are generally putting themselves at the back of the line in terms of their claim on the property in case of default. In my experience it is very rare to find a lender that is willing to put themselves third in line, much less any farther back. Generally if you were to ask for such a loan, the bank would insist that the prior commitments be paid off before they would lend to you. Meaning the bank that you ask for the $36k noted above would likely respond by saying they will loan you $70k provided that $40k of it goes directly to paying off the previous equity line.", "title": "" }, { "docid": "8ac5cffbd419a4f21a5789c2b9dc010d", "text": "Here is another way to look at it. Does this debt enable you to buy more car than you can really afford, or more car than you need? If so, it's bad debt. Let's say you don't have the price of a new car, but you can buy a used car with the cash you have. You will have to repair the car occasionally, but this is generally a lot less than the payments on a new car. The value of your time may make sitting around waiting while your car is repaired very expensive (if, like me, you can earn money in fine grained amounts anywhere between 0 and 80 hours a week, and you don't get paid when you're at the mechanic's) in which case it's possible to argue that buying the new car saves you money overall. Debt incurred to save money overall can be good: compare your interest payments to the money you save. If you're ahead, great - and the fun or joy or showoff potential of your new car is simply gravy. Now let's say you can afford a $10,000 car cash - there are new cars out there at this price - but you want a $30,000 car and you can afford the payments on it. If there was no such thing as borrowing you wouldn't be able to get the larger/flashier car, and some people suggest that this is bad debt because it is helping you to waste your money. You may be getting some benefit (such as being able to get to a job that's not served by public transit, or being able to buy a cheaper house that is further from your job, or saving time every day) from the first $10,000 of expense, but the remaining $20,000 is purely for fun or for showing off and shouldn't be spent. Certainly not by getting into debt. Well, that's a philosophical position, and it's one that may well lead to a secure retirement. Think about that and you may decide not to borrow and to buy the cheaper car. Finally, let's say the cash you have on hand is enough to pay for the car you want, and you're just trying to decide whether you should take their cheap loan or not. Generally, if you don't take the cheap loan you can push the price down. So before you decide that you can earn more interest elsewhere than you're paying here, make sure you're not paying $500 more for the car than you need to. Since your loan is from a bank rather than the car dealership, this may not apply. In addition to the money your cash could earn, consider also liquidity. If you need to repair something on your house, or deal with other emergency expenditures, and your money is all locked up in your car, you may have to borrow at a much higher rate (as much as 20% if you go to credit cards and can't get it paid off the same month) which will wipe out all this careful math about how you should just buy the car and not pay that 1.5% interest. More important than whether you borrow or not is not buying too much car. If the loan is letting you talk yourself into the more expensive car, I'd say it's a bad thing. Otherwise, it probably isn't.", "title": "" }, { "docid": "35730bf047c7562526d1b631eba05dc7", "text": "Actually if you look at a loan for $115,000 over 30 years at current interest rates you would have a payment of about $500 a month. I would argue your $500 monthly payments are building equity the same way a loan repayment schedule would. Is your agreement in writing? If it is, there's nothing you can do unless they agree. If it's not then write up a contract for a $115k loan that you will pay back over 30 years at $500 a month with the amortization table. That will show how much equity you're building over time. (It's not much the first 10 years!) Note that some states require real estate contract to be in writing or else they are voidable by either party. Whatever you do, get something in writing or you'll probably either end up in court or feeling bitter for the next few decades.", "title": "" }, { "docid": "3e75f93da64387ecaa1aa9283f7e38ac", "text": "You're driving a car worth about $6000 which has a $12,000 loan against it. You're driving around in a nett debt of $6000. The best thing your grandfather could do for you, if possible, is to take your name off both the title and the loan, refinancing the car in his name only. If possible while still letting you drive the car. When he dies, you will be out of a car, but also out of a $12,000 debt which I'm sure you could do without. Okay, the best thing your grandfather could do, from your wallet's point of view, is paying off the loan for you and then taking his name off the title.", "title": "" }, { "docid": "05c4fab0e8d3da81f656182506986df5", "text": "I work for a mortgage company but one that sells the loans we fund to banks. I've never heard of that risk mitigation incentive (lower rate for auto payments) but I know for a fact you will have a higher interest rate if you choose to pay your taxes and insurance out of your own pocket and not escrow them. I would contact the CFPB instead of an attorney and they will be able to tell you very quickly whether this is an acceptable practice or not.", "title": "" }, { "docid": "fe242e61ddef31e5d703de79fde2b92e", "text": "At the moment, you are paying about $1,300 interest each month (£431k @ 3.625% / 12) on your mortgage and repaying capital at about $1,500 per month. Paying $11,000 off your mortgage would save you about $9,000 as it is reduces your balance by about seven monthly capital repayments: but you will only see this benefit at the end of the mortgage because you will pay it off seven months earlier. There is only about $1,000 interest remaining on your car loans. Paying the $11,000 off your interest free loan then paying extra agianst the interest bearing loan brings that down to $500 and paying it off your interest bearing loan brings it down to $200. Either way, both car loans would be finished by early 2018. In summary, if you use the $11,000 against your car loans, you will save $8,500-$8,800 less than paying it off the mortage, but you will have no car loans in one year rather than three. Google spreadsheet for calculations here.", "title": "" } ]	fiqa
89b8e3679c04ec6761b3c726b831050d	Want to buy expensive product online. Credit line on credit cards not big enough. How do “Preferred Account” programs work?	[ { "docid": "6cc03efaaaeec43bd92ddad59c02ba53", "text": "\"First and foremost - make sure where you are purchasing the product is a reputable organization. Secondly (coming from a biased computer geek) - be aware that Apple is a content trap. Now on to my answer to your question... How do \"\"Preferred Account\"\" programs work? They're \"\"Preferred\"\" because they tend to bring in more money to the lender. It may say No payments for 6 months but the fine print may have you being charged interest during those 6 months, meaning your new shiny computer will be costing more than the sticker price. The good side is that you don't have to send in any actual payments for 6 months, but be aware that you'll probably be paying more than advertised. What are the different ways I can do it? Your listed options 1 & 2 are both good ways to pay for your new computer. Yes, option 1 will charge you sales tax, but are you sure paying online excludes sales tax? Some states mandate it. Option 2 is a viable option too - probably your best option. 1st - there is possibly no sales tax with purchases made online, although there may be a delivery charge. 2nd - you're not committing to an additional monthly bill, you are essentially paying with cash, just directly from your bank account. No interest charge! 3rd - that little Visa logo is your friend. Purchases made through Visa & MasterCard (whether it's a credit or debit card) normally have an auto-extended warranty feature (you may want to verify with Visa before taking my word on it). Typically they double any manufacture's warranty. Lastly - you can always set up a PayPal account and link it to your bank account. Assuming the site you plan on purchasing the computer from accepts PayPal.\"", "title": "" }, { "docid": "9f4c44d93e9656e5590d50d88174d087", "text": "\"The preferred accounts are designed to hope you do one of several things: Pay one day late. Then charge you all the deferred interest. Many people think If they put $X a month aside, then pay just before the 6 months, 12 moths or no-payment before 2014 period ends then I will be able to afford the computer, carpet, or furniture. The interest rate they will charge you if you are late will be buried in the fine print. But expect it to be very high. Pay on time, but now that you have a card with their logo on it. So now you feel that you should buy the accessories from them. They hope that you become a long time customer. They want to make money on your next computer also. Their \"\"Bill Me Later\"\" option on that site as essentially the same as the preferred account. In the end you will have another line of credit. They will do a credit check. The impact, both positive and negative, on your credit picture is discussed in other questions. Because two of the three options you mentioned in your question (cash, debit card) imply that you have enough cash to buy the computer today, there is no reason to get another credit card to finance the purchase. The delayed payment with the preferred account, will save you about 10 dollars (2000 * 1% interest * 0.5 years). The choice of store might save you more money, though with Apple there are fewer places to get legitimate discounts. Here are your options: How to get the limit increased: You can ask for a temporary increase in the credit limit, or you can ask for a permanent one. Some credit cards can do this online, others require you to talk to them. If they are going to agree to this, it can be done in a few minutes. Some individuals on this site have even been able to send the check to the credit card company before completing the purchase, thus \"\"increasing\"\" their credit limit. YMMV. I have no idea if it works. A good reason to use the existing credit card, instead of the debit card is if the credit card is a rewards card. The extra money or points can be very nice. Just make sure you pay it back before the bill is due. In fact you can send the money to the credit card company the same day the computer arrives in the mail. Having the transaction on the credit card can also get you purchase protection, and some cards automatically extend the warranty.\"", "title": "" } ]	[ { "docid": "c6810de46ac8d987ed495b03c9fc5dce", "text": "I have had my card blocked at home only rarely. One occasion comes to mind - I had bought something fairly large online late at night. No sooner had I clicked Purchase than my phone rang - the bank was asking had I actually just spent [$amount] at [$online store]? I said yes and that was that. A little later I made another purchase late at night on a different card. It went through, but when I tried to use the card the next day for something small in a store, it was declined. Embarrassed, I used a different card then called the bank. They said they had put the card on hold because of the online purchase for a large amount, even though they had let the purchase go through. They hadn't called me because it was late at night, and they hadn't given themselves any reasonable mechanisms to compensate for that (like calling me the next morning, emailing me, or the like) they'd just blocked the card. We had what you might call a frank and open exchange of views on the matter. Not all banks use the same strategies or software. I suggest: Far and away the simplest thing is just to have more than one card so that these declines are a momentary hiccup you might forget by the time you and your Rolex are out of the store.", "title": "" }, { "docid": "1eb37df8d834d9a541269b26ec8971da", "text": "\"Some features to be aware of are: How you prioritize these features will depend on your specific circumstances. For instance, if your credit score is poor, you may have to choose among cards you can get with that score, and not have much choice on other dimensions. If you frequently travel abroad, a low or zero foreign transaction fee may be important; if you never do, it probably doesn't matter. If you always pay the balance in full, interest rate is less important than it is if you carry a balance. If you frequently travel by air, an airline card may be useful to you; if you don't, you may prefer some other kind of rewards, or cash back. Cards differ along numerous dimensions, especially in the \"\"extra benefits\"\" area, which is often the most difficult area to assess, because in many cases you can't get a full description of these extra benefits until after you get the card. A lot of the choice depends on your personal preferences (e.g., whether you want airline miles, rewards points of some sort, or cash back). Lower fees and interest rates are always better, but it's up to you to decide if a higher fee of some sort outweighs the accompanying benefits (e.g., a better rewards rate). A useful site for finding good offers is NerdWallet.\"", "title": "" }, { "docid": "d0037b6404e2ca86c87d38625211d3cb", "text": "They have a minimum to discourage applications for that particular card. Every application costs them money because they have to pay the credit agencies to pull the applicant's credit history. So one way they save money and reduce their cost of business is to discourage people from applying if they're not creditworthy enough for that product. Credit card companies tailor their products into different income/credit brackets. Those who have less creditworthiness would be better suited for a different product than what you're referring, similar to those with greater creditworthiness.", "title": "" }, { "docid": "a3fce490685e386e16b16c2e938b82cf", "text": "Great question. First, my recommendation would be for you to get a card that does not have a yearly fee. There are many credit cards out there that provide cash back on your purchases or points to redeem for gift cards or other items. Be sure to cancel the credit card that you have now so you don't forget about that yearly fee. Canceling will have a temporary impact on your credit score if the credit card is your longest held line of credit. Second, it is recommended not to use more than 20% of all the available credit, staying above that line can affect your credit score. I think that is what you are hearing about running up large balances on your credit card. If you are worried about staying below the 20% line, you can always request a larger line of credit. Just keep paying it off each month though and you will be fine. You already have a history of credit if you have begun paying off your student loans.", "title": "" }, { "docid": "7dcbbcc78bd1561999720f4fd276ad02", "text": "Yeah I have credit cards now but his credit line got me jumped up from maybe a 200 to a 650 in a few months or a year or so. My bad I figured I posted it in the wrong sub! So if he cancels it, will this cause me to lose points? Considering the credit line is about 20K?", "title": "" }, { "docid": "3f3d31bed042d43531acf79a60aae8d0", "text": "\"Until the CARD act, credit card rules required that merchants had no minimum purchase requirement to use a card. New rules permit a minimum but it must be clearly posted. Update - Stores can now refuse small credit card charges is an excellent article which clarifies the rules. It appears that these rules apply to credit, not debit cards. So to be clear - the minimum do not apply to the OP as he referenced using a debit card. \"\"Superiority\"\"? Hm. I'd be a bit embarrassed to charge such small amounts. Although when cash in my wallet is very low, I may have little choice. Note, and disclaimer, I am 48, 30 years ago when I started using cards, there were no POS machines. Credit card transactions had a big device that got a card imprint and the merchant looked up to see if your card was stolen in a big book they got weekly/monthly. Times have changed, and debit cards may be faster, especially if with cash you give the cashier $5.37 for a $2.37 transaction, but the guy entered $5 already. This often takes a manager to clear up.\"", "title": "" }, { "docid": "a2bca858601b7bc24a317dbaf20d6a38", "text": "\"You have a lack of credit history. Lending is still tight since the recession and companies aren't as willing to take a gamble on people with no history. The secured credit card is the most direct route to building credit right now. I don't think you're going to be applicable for a department store card (pointless anyways and encourages wasteful spending) nor the gas card. Gas cards are credit cards, funded through a bank just like any ordinary credit card, only you are limited to gas purchases at a particular retailer. Although gas cards, department store cards and other limited usage types of credit cards have less requirements, in this post-financial crisis economy, credit is still stringent and a \"\"no history\"\" file is too risky for banks to take on. Having multiple hard inquiries won't help either. You do have a full-time job that pays well so the $500 deposit shouldn't be a problem for the secured credit card. After 6 months you'll get it back anyways. Just remember to pay off in full every month. After 6 months you'll be upgraded to a regular credit card and you will have established credit history.\"", "title": "" }, { "docid": "28349274456d5728c148fd4f35165880", "text": "This is a question with a flawed premise. Credit cards do have two-factor authentication on transactions they consider more at risk to be fraudulent. I've had several times when I bought something relatively expensive and unusual for me, where the CC either initially declined and sent me a text asking to confirm immediately (after which they would approve the charges), or approved but sent me a text right away asking to confirm (after which they'd automatically dispute if I told them to). The first is legitimately what you are asking for; the second is presumably for less risky but still some risk transactions). Ultimately, the reason they don't allow it for every transaction is that not enough people would make use of it to be worth their time to implement it. Particularly given it slows down the transaction significantly (and look at the complaints at the ~10-15 seconds extra EMV authentication takes, imagine that as a minute or more), I think you'd get a single digit percentage of people using that service.", "title": "" }, { "docid": "288aee3cde90d68f08dfb90dda778a6b", "text": "\"You are correct. Credit card companies charge the merchant for every transaction. But the merchant isn't necessarily going to give you discount for paying in cash. The idea is that by providing more payment options, they increase sales, covering the cost of the transaction fee. That said, some merchants require a minimum purchase for using a credit card, though this may be against the policies of some issuers in the U.S. (I have no idea about India.) Also correct. They hope that you'll carry a balance so that they can charge you interest on it. Some credit cards are setup to charge as many fees as they possibly can. These are typically those low limit cards that are marketed as \"\"good\"\" ways to build up your credit. Most are basically scams, in the fact that the fees are outrageous. Update regarding minimum purchases: Apparently, Visa is allowing minimum purchase requirements in the U.S. of $10 or less. However, it seems that MasterCard still does not allow them, for the most part. Moral of the story: research the credit card issuers' policies. A further update regarding minimum purchases: In the US, merchants will be allowed to require a minimum purchase of up to $10 for credit card transactions. (I am guessing that prompted the Visa rule change mentioned above.) More detail can be found here in this answer, along with a link to the text of the bill itself.\"", "title": "" }, { "docid": "b324d756f11286a3f2de6da4a67af60b", "text": "\"In the UK, using a credit card adds a layer of protection for consumers. If something goes wrong or you bought something that was actually a scam, if you inform the credit card company with the necessary documents they will typically clear the balance for that purchase (essentially the burden of 'debt' is passed to them and they themselves will have to chase up the necessary people). Section 75 of the Consumer Credit Act I personally use my credit card when buying anything one would consider as \"\"consumer spending\"\" (tvs, furniture ect). I then pay off the credit card immediately. This gives me the normal benefits of the credit card (if you get cashback or points) PLUS the additional consumer credit protection on all my purchases. This, in my opinion is the most effective way of using your credit card.\"", "title": "" }, { "docid": "a89bd74e7a3d5b571288ebb11b2dacc4", "text": "\"I completely agree with @littleadv in favor of using the credit card and dispute resolution process, but I believe there are more important details here related to consumer protection. Since 1968, US citizens are protected from credit card fraud, limiting the out-of-pocket loss to $50 if your card is lost, stolen, or otherwise used without your permission. That means the bank can't make you pay more than $50 if you report unauthorized activity--and, nicely, many credit cards these days go ahead and waive the $50 too, so you might not have to pay anything (other than the necessary time and phone calls). Of course, many banks offer a $50 cap or no fees at all for fraudulent charges--my bank once happily resolved some bad charges for me at no loss to me--but banks are under no obligation to shield debit card customers from fraud. If you read the fine print on your debit card account agreement you may find some vague promises to resolve your dispute, but probably nothing saying you cannot be held liable (the bank is not going to lose money on you if they are unable to reverse the charges!). Now a personal story: I once had my credit card used to buy $3,000 in stereo equipment, at a store I had never heard of in a state I have never visited. The bank notified me of the surprising charges, and I was immediately able to begin the fraud report--but it took months of calls before the case was accepted and the charges reversed. So, yes, there was no money out of my pocket, but I was completely unable to use the credit card, and every month they kept on piling on more finance fees and late-payment charges and such, and I would have to call them again and explain again that the charges were disputed... Finally, after about 8 months in total, they accepted the fraud report and reversed all the charges. Lastly, I want to mention one more important tool for preventing or limiting loss from online purchases: \"\"disposable\"\", one-time-use credit card numbers. At least a few credit card providers (Citibank, Bank of America, Discover) offer you the option, on their websites, to generate a credit card number that charges your account, but under the limits you specify, including a maximum amount and expiration date. With one of these disposable numbers, you can pay for a single purchase and be confident that, even if the number were stolen in-transit or the merchant a fraud, they don't have your actual credit card number, and they can never charge you again. I have not yet seen this option for debit card customers, but there must be some banks that offer it, since it saves them a lot of time and trouble in pursuing defrauders. So, in short: If you pay with a credit card number you will not ever have to pay more than $50 for fraudulent charges. Even better, you may be able to use a disposable/one-time-use credit card number to further limit the chances that your credit is misused. Here's to happy--and safe--consumering!\"", "title": "" }, { "docid": "074fefb0d464c1ed76289e41089e5ff8", "text": "\"What you have is usually called a pre-paid credit card. You pay some money (Indian Rupees) to the credit card company, and then you can use the card to pay for purchases etc in foreign (non-Indian) currencies upto the remaining balance on the card. If a proposed charge exceeds the remaining balance, the transaction will be declined when you try to use the card. There might be multiple ways that the card is set up, e.g. it might be restricted to charge purchases denominated in US dollars alone, or you might be able to use it anywhere in the world (except India). The balance on the card might be denominated in INR, or in US$, say. In the latter case, the exchange rate at which your INR payment was converted into the $US balance is fixed and agreed to at the time of the original payment: you paid INR 70K (say) and the balance was set to US$ 1000 even though the exchange rate on the open market would have given you a few more US dollars. In the former case with the balance denominated in INR, a charge of US$ 100, say, would be converted to INR at a fixed agreed-upon rate, or at the current exchange rate that the Visa or MasterCard network is using, plus (typically) a 3% fee currency exchange fee, and your balance in INR will decrease accordingly. With all that as prologue, if you made a purchase from Walmart USA and later returned it for a credit, it should increase your credit card balance appropriately. You may be whacked with currency conversion fees along the way depending on how your card is set up, but with a US$-denominated card, a credit of US$100 should increase your card balance by US$100. So, that $US 100 can be spent on something else instead. In short, the card is your \"\"bank\"\" account. You cannot spend more than the remaining balance on the card just like you cannot withdraw more money from your bank account than you have in the account, and you can recharge your card by making more INR payments into it so as to increase the available balance. But it is like a current account in that you are unlikely to earn interest on the balance the way you do with a savings account. So what if you are back in India and have no further use of this card? Can you get your balance back as cash or deposit into your regular bank account? Call the Customer Help line, or read the card agreement you signed.\"", "title": "" }, { "docid": "39bcb0e40e9aeb3a52b16e3a23dae31e", "text": "\"Retail purchases are purchases made at retail, i.e.: as a consumer/individual customer. That would include any \"\"standard\"\" individual expenditure, but may exclude wholesale sales or purchases from merchants who identify themselves as service providers to businesses. Specifics of these limitations really depend on your card issuer, and you should inquire with the customer service at what are their specific eligibility requirements. As an example, here in the US many cards give high cash-back for gasoline purchases, but only at \"\"retail\"\" locations. That excludes wholesale/club sellers like Costco, for example.\"", "title": "" }, { "docid": "2f1ba347564bf022cb2ff4282dfce309", "text": "As long as you can be trusted with a Credit Card i find that if you have a setup that uses three accounts: 1. your Credit Card, 2. 2. a high interest internet account (most of these accounts don’t have fees), 3. a savings account. The Method that works for me is: 1st i calculate my fixed monthly bills i.e Rent and utilities and then transfer it into my high interest account. for the month whenever i make a purchase i transfer the money into the high interest account ( this way I can keep a running balance of what money I have left to spend in the month. Then when the Credit Card bill comes I transfer the money out of the high interest account across to pay off the Credit Card ( this way you generate interest on the money which you would have spent throughout the month and still maintain $0 of interest from the Credit Card) over a year you can generate at least enough money in interest to go out for dinner on one of free flights!", "title": "" }, { "docid": "44af6e62a7fd75f9cf9513658df55b90", "text": "Trick question dude. Can't be done. Sorry to tell you. I've been hit with this. Credit card companies do not make money on these customers. Why does Amex have an annual fee on all cards and an abnormally large transaction fee for merchants? Because they don't allow you to carry a balance (On traditional cards). Meaning they don't make money on interest, like the customers in question here.", "title": "" } ]	fiqa
c8cbfc510c09e87b2cd1e657c8d1f433	I'm halfway through a 5-year purchase financing deal on my car. It's expensive. Can I sell it and get a cheaper car?	[ { "docid": "2bcff75efa64863edad934ea3a368296", "text": "\"You say \"\"it's expensive\"\". I'm going to interpret this as \"\"the monthly payments are too high\"\". Basically, you need to get your old loan paid off, presumably by selling the car you have now. This is the tough part. If you sold the car now, how much would you get for it? You can use Kelley Blue Book to figure out what the car is roughly worth. That's not a guarantee that it will actually sell for that much. Look in your local classifieds to see what similar cars are selling for. (Keep in mind that you will usually get less for your old car if you trade it in versus sell it yourself.) Now, if you owe more than your car is worth, you're in a really tight spot. If you don't get enough money when you sell it, you are still stuck with the remainder of the loan. In that case, it is usually best to just stick with the car you have, and be more cautious about payments and loan length the next time you finance a car. Penalties: Most car loans don't have any kind of early repayment penalty. However, you should check your loan paperwork just to make sure.\"", "title": "" } ]	[ { "docid": "1109a029b9265828ac0b300a07184763", "text": "\"This is \"\"incentive financing\"\". Simply put, the car company isn't in the business of making money by buying government bonds. They're in the business of making money by selling cars. If you are \"\"qualified\"\" from a credit standpoint, and want to buy a $20k car on any given Sunday, you'll typically be offered a loan of between 6% and 9%. Let's say this loan is for three years and you can offer $4000 down payment and/or trade. The required monthly payment on the remaining $16k at the high end of 9% is $508.80, which over 3 years means you'll pay $2,316.64 in interest. Now, that may sound like a good chunk of change, and for the ordinary individual, it is, possibly enough that you decide not to buy today. Now, let's say, all other things being equal, that the company is offering 0.9% incentive financing. Same price, same down payment, same loan term. Your payments over 3 years decrease to $450.64, and over the same loan term you would only pay $222.97 in interest. You save over $2,093.67 in interest over three years, which for you is again a decent chunk of change. Theoretically, the car company's losing that same $2,093.67 in interest by offering this deal, and depending on how it's getting the money it lends you (most financial companies are middlemen, getting money from bond-buying investors who expect a rate of return), that could be a real loss and not just opportunity cost. But, that incentive got you to walk in their door, and not their competitor's. It helped convince you to buy the $20,000 car. The gross margin on that car (price minus direct costs) is typically 20% for the dealer, plus another 20% for the manufacturer, so by giving up the $2,000 on the financing side, the dealer and manufacturer just earned themselves 4 times that much. On top of that, by buying that car, you're committing to buy the parts for the car, a side business with even higher margins, of which the car company gets a pretty big chunk. You may even be required to use dealer service while the car's under warranty in order to keep the warranty valid, another cha-ching. When you get right down to it, the loss from the incentive financing is drowned in the gross profits they make from selling the car to you. Now, in reality, it's a fine balance. The percentages I mentioned are gross margins (EBITDASG&A - Earnings Before Interest, Taxes, Depreciation, Amortization, Sales, General and Administrative costs; basically, just revenue minus direct cost of goods sold). Add in all these side costs and you get a net margin of only about 3.5% of revenue, so your $20k car purchase may only make the car company's stakeholders $700 on the sale, plus slightly higher net margins on parts and service over the life of the car. Because incentive financing is typically only offered through the company's own financing subsidiary, the loss isn't in the form of a cost paid, but simply a revenue not realized, but it can still move a car company from net positive to net negative earnings if the program is too successful. This is why not everyone does it, and not all at the same time; if you're selling enough cars without it, why give away money? Typically, these incentives are offered for two reasons; to clear out old cars or excess inventory, or to maintain ground against a competitor's stronger sales numbers. Keeping cars on a lot ready to sell is expensive, and so is not having your brand driving around on the street turning heads and imprinting their name on the minds of potential customers.\"", "title": "" }, { "docid": "d3131fea694d5ac842c532e951554e55", "text": "\"I'm sorry to hear you've made a mistake. Having read the contract of sale we signed, I do not see any remedy to your current situation. However, I'm interested in making sure I do not take advantage of you. As such, I'll return the vehicle, you can return my money plus the bank fees I paid for the cashiers check, tax, title, and registration, and I will look at buying a vehicle from another dealership. This seems to be the most fair resolution. If I were to pay for your mistake at a price I did not agree to, it would not be fair to me. If you were to allow this vehicle to go to me at the price we agreed to, it wouldn't be fair to you. If I were to return the car and begin negotiations again, or find a different car in your lot, it would be difficult for us to know that you were not going to make a similar mistake again. At this point I consider the sale final, but if you'd prefer to have the vehicle back as-is, returning to us the money we gave you as well as the additional costs incurred by the sale, then we will do so in order to set things right. Chances are good you will see them back down. Perhaps they will just cut the additional payment in half, and say, \"\"Well, it's our mistake, so we will eat half the cost,\"\" or similar, but this is merely another way to get you to pay more money. Stand firm. \"\"I appreciate the thought, but I cannot accept that offer. When will you have payment ready so we can return the car?\"\" If you are firm that the only two solutions is to keep the car, or return it for a full refund plus associated costs, I'd guess they'd rather you keep the car - trust me, they still made a profit - but if they decide to have it returned, do so and make sure they pay you in full plus other costs. Bring all your receipts, etc and don't hand over the keys until you have the check in hand. Then go, gladly, to another dealership that doesn't abuse its customers so badly. If you do end up keeping the car, don't plan on going back to that dealership. Use another dealership for warranty work, and find a good mechanic for non-warranty work. Note that this solution isn't legally required in most jurisdictions. Read your contract and all documentation they provided at the time of sale to be sure, but it's unlikely that you are legally required to make another payment for a vehicle after the sale is finalized. Even if they haven't cashed the check, the sale has already been finalized. What this solution does, though, is put you back in the driver's seat in negotiating. Right now they are treating it as though you owe them something, and thus you might feel an obligation toward them. Re-asserting your relationship with them as a customer rather than a debtor is very important regardless of how you proceed. You aren't legally culpable, and so making sure they understand you aren't will ultimately help you. Further, dealerships operate on negotiation. The primary power the customer has in the dealership is the power to walk away from a deal. They've set the situation up as though you no longer have the power to walk away. They didn't threaten with re-possession because they can't - the sale is final. They presented as a one-path situation - you pay. Period. You do have many options, though, and they are very familiar with the \"\"walk away\"\" option. Present that as your chosen option - either they stick with the original deal, or you walk away - and they will have to look at getting another car off the lot (which is often more important than making a profit for a dealership) or selling a slightly used car. If they've correctly pushed the title transfer through (or you, if that's your task in your state) then your brief ownership will show up on carfax and similar reports, and instantly reduces the car's worth. Having the title transfer immediately back to the dealership doesn't look good to future buyers. So the dealership doesn't want the car back. They are just trying to extract more money, and probably illegally, depending on the laws in your jurisdiction. Reassert your position as customer, and decide now that you'll be fine if you have to return it and walk away. Then when you communicate that to them, chances are good they'll simply cave and let the sale stand as-is.\"", "title": "" }, { "docid": "843bd070c05793eb9f6ca5f028f0c13c", "text": "Buying and selling cars a lot is something that makes money if you are a dealer but usually doesn't if you are not. The question to ask yourself is why you want to sell it. If it is because you are feeling poor and need money, it might make sense to sell it, particularly if you don't need it. But $12k or whatever is not a ton of money. If you do need a car and will have to replace it if you sell it then selling it is likely not a good idea. If it is because you want a nicer car and can afford to upgrade, then selling it is likely a good idea. The fact that you have had it for years and not paid off the loan tells me this situation is unlikely. You should think of the value of your car to you (and the potential cost of replacing it) and the amount of money you owe on it as two different things. The debt you have is a debt that you will need to pay no matter what you do with the car or how its value changes. The value of the car to you is pretty much a separate issue from how much you have outstanding in debt. If you want to sell the car to pay off the debt that is fine if you don't need the car or if you can get a suitable replacement car for MUCH less (which I find unlikely).", "title": "" }, { "docid": "7059a7d0bfe3ad4e22effcd4c6298c90", "text": "I have a few recommendations/comments: The trick here is to make it clear to the dealer that you will not be getting a new car from them and their only hope of making some money is to sell you your own car. You need to be prepared to walk away and follow through. DON'T buy a new car from them even if you end up turning it in! They could still come back a day later and offer a deal. Leasing a new car every 3 years is not the best use of money. You have to really, really like that new car feeling every three years and be willing to pay a premium for it. If you're a car nut (like me) and want to spend money on a luxury car, it's far wiser to purchase a slightly used luxury vehicle, keep it for 8+ years, and that way you won't have a car payment half the time!", "title": "" }, { "docid": "ee60151939fc8a15f134d44755e021c1", "text": "$27,000 for a car?! Please, don't do that to yourself! That sounds like a new-car price. If it is, you can kiss $4k-$5k of that price goodbye the moment you drive it off the lot. You'll pay the worst part of the depreciation on that vehicle. You can get a 4-5 year old Corolla (or similar import) for less than half that price, and if you take care of it, you can get easily another 100k miles out of it. Check out Dave Ramsey's video. (It's funny that the car payment he chooses as his example is the same one as yours: $475! ;) ) I don't buy his take on the 12% return on the stock market (which is fantasy in my book) but buying cars outright instead of borrowing or (gasp) leasing, and working your way up the food chain a bit with the bells/whistles/newness of your cars, is the way to go.", "title": "" }, { "docid": "d6044c3a4b75698748dd4995f956f311", "text": "That is a desirable model so I doubt you could get it into the low 30's. Also you mentioned you want it optioned out. That would also reduce the leverage you have in the negotiation. Look at True Car to find out what you'd actually be paying. You will either get the car you want or the price you want.", "title": "" }, { "docid": "2bb4e06785887fbf93def08101666f95", "text": "\"For the future: NEVER buy a car based on the payment. When dealers start negotiating, they always try to have you focus on the monthly payment. This allows them to change the numbers for your trade, the price they are selling the car for, etc so that they maximize the amount of money they can get. To combat this you need to educate yourself on how much total money you are willing to spend for the vehicle, then, if you need financing, figure out what that actually works out to on a monthly basis. NEVER take out a 6 year loan. Especially on a used car. If you can't afford a used car with at most a 3 year note (paying cash is much better) then you can't really afford that car. The longer the note term, the more money you are throwing away in interest. You could have simply bought a much cheaper car, drove it for a couple years, then paid CASH for a new(er) one with the money you saved. Now, as to the amount you are \"\"upside down\"\" and that you are looking at new cars. $1400 isn't really that bad. (note: Yes you were taken to the cleaners.) Someone mentioned that banks will sometimes loan up to 20% above MSRP. This is true depending on your credit, but it's a very bad idea because you are purposely putting yourself in the exact same position (worse actually). However, you shouldn't need to worry about that. It is trivial to negotiate such that you pay less than sticker for a new car while trading yours in, even with that deficit. Markup on vehicles is pretty insane. When I sold, it was usually around 20% for foreign and up to 30% for domestic: that leaves a lot of wiggle room. When buying a used car, most dealers ask for at least $3k more than what they bought them for... Sometimes much more than that depending on blue book (loan) value or what they managed to talk the previous owner out of. Either way, a purchase can swallow that $1400 without making it worse. Buy accordingly.\"", "title": "" }, { "docid": "1998aad62501d90096f94e435b798ef6", "text": "The advice given at this site is to get approved for a loan from your bank or credit union before visiting the dealer. That way you have one data point in hand. You know that your bank will loan w dollars at x rate for y months with a monthly payment of Z. You know what level you have to negotiate to in order to get a better deal from the dealer. The dealership you have visited has said Excludes tax, tag, registration and dealer fees. Must finance through Southeast Toyota Finance with approved credit. The first part is true. Most ads you will see exclude tax, tag, registration. Those amounts are set by the state or local government, and will be added by all dealers after the final price has been negotiated. They will be exactly the same if you make a deal with the dealer across the street. The phrase Must finance through company x is done because they want to make sure the interest and fees for the deal stay in the family. My fear is that the loan will also not be a great deal. They may have a higher rate, or longer term, or hit you with many fee and penalties if you want to pay it off early. Many dealers want to nudge you into financing with them, but the unwillingness to negotiate on price may mean that there is a short term pressure on the dealership to do more deals through Toyota finance. Of course the risk for them is that potential buyers just take their business a few miles down the road to somebody else. If they won't budge from the cash price, you probably want to pick another dealer. If the spread between the two was smaller, it is possible that the loan from your bank at the cash price might still save more money compared to the dealer loan at their quoted price. We can't tell exactly because we don't know the interest rates of the two offers. A couple of notes regarding other dealers. If you are willing to drive a little farther when buying the vehicle, you can still go to the closer dealer for warranty work. If you don't need a new car, you can sometimes find a deal on a car that is only a year or two old at a dealership that sells other types of cars. They got the used car as a trade-in.", "title": "" }, { "docid": "06b62f2e839c4409e58c08dab7ad9f74", "text": "1) How long have you had the car? Generally, accounts that last more than a year are kept on your credit report for 7 years, while accounts that last less than a year are only kept about 2 years (IIRC - could someone correct me if that last number is wrong?). 2) Who is the financing through? If it's through a used car dealer, there's a good chance they're not even reporting it to the credit bureaus (I had this happen to me; the dealer promised he'd report the loan so it would help my credit, I made my payments on time every time, and... nothing ever showed up. It pissed me off, because another positive account on my credit report would have really helped my score). Banks and brand name dealers are more likely to report the loan. 3) What are your expected long term gains on the stocks you're considering selling, and will you have to pay capital gains on them when you do sell them? The cost of selling those stocks could possibly be higher than the gain from paying off the car, so you'll want to run the numbers for a couple different scenarios (optimistic growth, pessimistic, etc) and see if you come out ahead or not. 4) Are there prepayment penalties or costs associated with paying off the car loan early? Most reputable financiers won't include such terms (or they'll only be in effect during the first few months of the loan), but again it depends on who the loan is through. In short: it depends. I know people hate hearing answers like that, but it's true :) Hopefully though, you'll be able to sit down and look at the specifics of your situation and make an informed decision.", "title": "" }, { "docid": "e50b5bb1e442c035db4970ad52e0f7bb", "text": "Yes, but then either of you will need the other's permission to sell the car. I strongly recommend you get an agreement on that point, in writing, and possibly reviewed by a lawyer, before entering into this kind of relationship. (See past discussions of car titles and loan cosigners for some examples of how and why this can go wrong.) When doung business with friends, treating it as a serious business transaction is the best way to avoid ruining the friendship.", "title": "" }, { "docid": "d1f1aa4fd1d65fa135ec33d4155d334c", "text": "\"You are correct to be wary. Car dealerships make money selling cars, and use many tactics and advertisements to entice you to come into their showroom. \"\"We are in desperate need of [insert your make, model, year and color]! We have several people who want that exact car you have! Come in and sell it to us and buy a new car at a great price! We'll give you so much money on your trade in!\"\" In reality, they play a shell game and have you focus on your monthly payment. By extending the loan to 4 or 5 years (or longer), they can make your monthly payment lower, sure, but the total amount paid is much higher. You're right: it's not in your best interest. Buy a car and drive it into the ground. Being free of car payments is a luxury!\"", "title": "" }, { "docid": "9ad9769a769d69359409fab55b1fd611", "text": "Check the employee-friends-and-family sales contract, which your friend should be able to get quite easily. There is almost always a minimum holding period before resale clause, specifically to prevent this kind of scenario. Without that clause, the dealers tend to riot... Also, remember that a car loses a huge percentage of its value the moment it leaves the lot. Odds are that you'd be doing well to find someone willing to buy it from you at the discounted price. If you don't want this car, ask your friend not to buy it and get one you do want. Seriously.", "title": "" }, { "docid": "adb7c3eb452280c427bd24d4c008a04d", "text": "Some questions: Will you need a car after 18 months? What are you going to do then? How likely are you able to go over the mileage? Granted paying $300 per month seems somewhat attractive as a fixed cost. However lease are notorious for forcing people into making bad decisions. If your car is over miles, or there is some slight damage (even normal wear and tear), or you customize your car (such as window tint) the dealer can demand extra dollars or force you to purchase the car for more than it is actually worth. The bottom line is leasing is one of the most expensive ways to own a vehicle, and while you have a great income you have a poor net worth. So yes I would say it is somewhat irresponsible for you to own a vehicle. If I was in your shoes, I would cut my gym expenses, cut my retirement contributions to the match, and buy another used car. I understand you may have some burnout over your last car, but it is the best mathematical choice. Having said all that you have a great income and you can absorb a lot of less than efficient decisions. You will probably be okay leasing the car. I would suggest going for a longer term, or cutting something to pay off the student loans earlier. This way there is some cushion between when the lease ends and the student loan ends. This way, when lease turn in comes, you will have some room in your budget to pay some fees as you won't have your student loan payment (assuming around 1400/month) that you can then pay to the dealer.", "title": "" }, { "docid": "22583fa50c9ff6f21a1e127b4bdeed3b", "text": "Most states do have a cooling-off period where the buyer can rescind the purchase as well as a legally allowed limit to how long the dealer has to secure financing when they buyer has opted for dealer-financing. If the dealer did inform you during the allowed window, they will refund your down payment minus mileage fees at a state set cost per mile that you used the car. If the dealer did not inform you during the allowed window, depending on the state, they may have to refund the entire down payment. In any case, the problem is that the bank does not want to offer you the loan, you can try to negotiate and have the dealer use what leverage they have to coerce the bank, but there is probably no way for you to force the loan through. Alternatively you can seek your own financing from your own bank or credit union, which will likely allow the sale to go through. UPDATE - Colorado laws allow the dealer 10 days to inform you that they cannot obtain financing on the terms agreed upon in the original contract. That contract contained wording related to the mileage fees. You can find that info on page 8 of the linked PDF under the heading D. USAGE FEE AND MILEAGE CHARGE", "title": "" }, { "docid": "30f16531b7454d3d187e72c0f44fc93f", "text": "\"—they will pull your credit report and perform a \"\"hard inquiry\"\" on your file. This means the inquiry will be noted in your credit report and count against you, slightly. This is perfectly normal. Just don't apply too many times too soon or it can begin to add up. They will want proof of your income by asking for recent pay stubs. With this information, your income and your credit profile, they will determine the maximum amount of credit they will lend you and at what interest rate. The better your credit profile, the more money they can lend and the lower the rate. —that you want financed (the price of the car minus your down payment) that is the amount you can apply for and in that case the only factors they will determine are 1) whether or not you will be approved and 2) at what interest rate you will be approved. While interest rates generally follow the direction of the prime rate as dictated by the federal reserve, there are market fluctuations and variances from one lending institution to the next. Further, different institutions will have different criteria in terms of the amount of credit they deem you worthy of. —you know the price of the car. Now determine how much you want to put down and take the difference to a bank or credit union. Or, work directly with the dealer. Dealers often give special deals if you finance through them. A common scenario is: 1) A person goes to the car dealer 2) test drives 3) negotiates the purchase price 4) the salesman works the numbers to determine your monthly payment through their own bank. Pay attention during that last process. This is also where they can gain leverage in the deal and make money through the interest rate by offering longer loan terms to maximize their returns on your loan. It's not necessarily a bad thing, it's just how they have to make their money in the deal. It's good to know so you can form your own analysis of the deal and make sure they don't completely bankrupt you. —is that you can comfortable afford your monthly payment. The car dealers don't really know how much you can afford. They will try to determine to the best they can but only you really know. Don't take more than you can afford. be conservative about it. For example: Think you can only afford $300 a month? Budget it even lower and make yourself only afford $225 a month.\"", "title": "" } ]	fiqa
25b8d20996be39bdfb70fd1ab7b7408d	The penalty on early redemption of a personal loan	[ { "docid": "fe99b41d907d9b288aded1f73ee0df29", "text": "In month 9 you still owe $7,954.25. You need to pay that, plus the $250. At that line, you haven't made the payment, the rest of the line with next month's payment due. So you haven't paid the $242.47 in col 4.", "title": "" } ]	[ { "docid": "4f9f5b030ba22a07c5635bb76abf7cda", "text": "The dealership is getting a kickback for having you use a particular bank to finance through. The bank assumes you will take the full term of the loan to pay back, and will hopefully be a repeat customer. This tactic isn't new, and although it maybe doesn't make sense to you, the consumer, in the long run it benefits the bank and the dealership. (They wouldn't do it otherwise. These guys have a lot of smart people running #s for them). Be sure to read the specifics of the loan contract. There may be a penalty for paying it off early. Most customers won't be able to pay that much in cash, so the bank makes a deal with the dealership to send clients their way. They will lose money on a small percentage of clients, but make more off of the rest of the clients. If there's no penalty for paying it off early, you may just want to take the financing offer and pay it off ASAP. If you truly can only finance $2500 for 6 mos, and get the full discount, then that might work as well. The bank had to set a minimum for the dealership in order to qualify as a loan that earns the discount. Sounds like that's it. Bonus Info: Here's a screenshot of Kelley Blue Book for that car. Car dealers get me riled up, always have, always will, so I like doing this kind of research for people to make sure they get the right price. Fair price range is $27,578 - $28,551. First time car buyers are a dealers dream come true. Don't let them beat you down! And here's more specific data about the Florida area relating to recent purchases:", "title": "" }, { "docid": "ceb0296f8c154f411ec59378a46403a7", "text": "This depends on the loan calculation methodology. If it is on reducing balance then yes. Else not much difference", "title": "" }, { "docid": "677cd0eef79aa491a9855e7950af7a82", "text": "Previous to apply for a home loan, recognize the time of charges, punishment or fee charged by your lending company or bank for defaulting in monthly EMI. Know the dispensation accuse and in case a person decides to control their loan from current lender to a new lender, the present lender will charge consequence or fee for pre-closure of your loan.", "title": "" }, { "docid": "6f0cc2e96060ea740329a49fafde29e6", "text": "didn't pay the extra underpayment penalty on the grounds that it was an honest mistake. You seem to think a penalty applies only when the IRS thinks you were trying to cheat the system. That's not the case. A mistake (honest or otherwise) still can imply a penalty. While you can appeal just about anything, on any grounds you like, it's unlikely you will prevail.", "title": "" }, { "docid": "b03915b188d6fcb35d4155487adbc78c", "text": "In the US, our standard fixed rate mortgages would show no difference. My payment is calculated to be due on the 1st of each month. When I first got a mortgage, I was intrigued by this question, and experimented. I paid early, on the 15th, 2 weeks early, and looked at my next statement. It matched the amortization, exactly. Mortgages at the time were over 12%, so I'd imagine having seen the benefit of that 1/2% for the early payment. Next I paid on the last day before penalty, in effect, 2 weeks late. I expected to see extra interest accrue, again, just a bit, but enough to see when compared to the amortization table. Again, no difference, the next statement showed the same value to the penny.", "title": "" }, { "docid": "0a9b7c65041a6f118219a08a837c8ba8", "text": "\"The underpayment \"\"penalty\"\" is just interest on the late payments--willful or not has nothing to do with it. When they feel it's willful there will be additional penalties.\"", "title": "" }, { "docid": "98398da01efbe021f1bc313cfaa8aead", "text": "For conversions you do not to be 59-1/2 to avoid penalty. The 5-yr rule thus creates an early withdrawal option if planned well in advance. See the flow chart in http://www.irs.gov/publications/p590/ch02.html#en_US_2012_publink1000231030 For where I sourced the answer. Note : I edited to correct my answer. User102008 called me out on my mistake, and rightly so. The dialog is in the comments, where he points out the mistake. Good job, new User.", "title": "" }, { "docid": "e17891853f8ba14a06247af56ef889c3", "text": "\"No. Credit card companies will typically not care about your individual credit card account. Instead they look either at a \"\"package\"\" of card accounts opened at roughly the same time, or of \"\"slices\"\" of cardholder accounts by credit rating. If an entire package's or slice's balance drops significantly, they'll take a look, and will adjust rates accordingly (often they may actually decrease rates as an incentive to increase you use of the card). Because credit card debt is unstructured debt, the bank cannot impose an \"\"early payment penalty\"\" of any kind (there's no schedule for paying it off, so there's no way to prove that they're missing out on $X in interest because you paid early). Generally, banks don't like CC debt anyway; it's very risky debt, and they often end up writing large balances off for pennies on the dollar. So, when you pay down your balance by a significant amount, the banks breathe a sigh of relief. The real money, the stable money, is in the usage fees; every time you swipe your card, the business who accepted it owes the credit card company 3% of your purchase, and sometimes more.\"", "title": "" }, { "docid": "360448724a2cebca4bbfeff2001f9da6", "text": "The principal of the contribution can definitely be withdrawn tax-free and penalty-free. However, there is a section that makes me think that the earnings part may be subject to penalty in addition to tax. In Publication 590-A, under Traditional IRAs -> When Can You Withdraw or Use Assets? -> Contributions Returned Before Due Date of Return -> Early Distributions Tax, it says: The 10% additional tax on distributions made before you reach age 59½ does not apply to these tax-free withdrawals of your contributions. However, the distribution of interest or other income must be reported on Form 5329 and, unless the distribution qualifies as an exception to the age 59½ rule, it will be subject to this tax. This section is only specifically about the return of contributions before the due date of return, not a general withdrawal (as you can see from the first sentence that the penalty doesn't apply to contributions, which wouldn't be true of general withdrawals). Therefore, the second sentence must be about the earnings part of the withdrawal that you must make together with the contribution part as part of the return of contributions before the due date of the return. If the penalty it is talking about is only about other types of withdrawals and doesn't apply to the earnings part of the return of contribution before the due date of the return, then this sentence wouldn't make sense as it's in a part that's only about return of contribution before the due date of the return.", "title": "" }, { "docid": "f8c9078cccfd12d96e73929d4f49c607", "text": "If you withdraw your funds from your 401k and DO NOT mive it into another 401k plan or IRA within 60 days it will constitute as an early distribution which will carry a panlty of 10% as well as have income tax owed on it.", "title": "" }, { "docid": "530d44ec6a3ba57ef978b22dbab78778", "text": "It is often the case (more commonly in countries other than the USA) that a fixed-term loan has an early redemption penalty, because the lender themselves will incur a cost for settling the loan early, while a variable-rate loan does not. If this is the situation and you think you might want to pay off the loan early, you should definitely consider the variable rate rather than then fixed rate.", "title": "" }, { "docid": "3c93547daf7808e5d25d4c3003e27076", "text": "\"I'm answering my own question because in some sense, I alone know the answer. After the review, HMRC decided to waive all penalties (including the initial £100 penalty for late filing, which I had not appealed against) because \"\"HMRC may not have informed me\"\" about the mounting penalties. I had pretty good evidence that they hadn't informed me as there was a software change and immediately after that I got an initial penalty notice followed a day or so later by the further penalty notice. But I am happy with the outcome, I wasn't going to argue any further!\"", "title": "" }, { "docid": "5274ce56724302aa26b53670f04d501d", "text": "\"Here is a simple loan payment calculator. If you allow early principal repayment, then you should just be able to plug in the new principal amount to find his new monthly payment (someone please correct me if I'm mistaken). Are you averse to creating a spreadsheet yourself in excel? I suppose it could become quite an undertaking, depending on how detailed you chose to get with the interest. Seems like it would be more direct and serve the dual purpose of recordkeeping. It's important to agree in advance whether pre-payments go to principal or go partly to interest (prepaying for periodic amounts not yet due, which are mixed principal and interest). It's a family loan, so it probably makes sense to allow the prepayments to pay down principal; you don't need to structure your interest income and prevent him from depriving you of interest income (which many bank loans will do). Allowing early principal repayment is pretty easy to calculate in your own excel spreadsheet, since you just need to know the remaining principal, time outstanding, and the interest rate. Note that if you are a US citizen, then the interest paid to you will be taxable income to you (\"\"ordinary income\"\" rate). Your brother will not be able to deduct the interest payments, unless maybe they are used for something like his business or perhaps mortgage. There is no deduction for just a personal loan. Also, if you instead structured it without interest, then the interest not charged would be considered a gift under US gift tax law. As long as the annual interest were under the gift exclusion amount ($14,000) then there would be no gift tax. With no interest and no gift, you would not have tax consequences.\"", "title": "" }, { "docid": "5cc2b16d5596458579599c53d1788430", "text": "Am I eligible for the tax exemption if yes then under which section. Generally Personal loans are not eligible for tax exemption. Only housing loans from qualified institutions are eligible for tax deduction. As per the income tax act; The house should be in your name. The home loans taken from recognised institutions are fully qualified under section 24B and 80C. This means you can claim Interest exemption under 24B and Principal repayment under 80C. The Act also specifies that loan can be taken from friends/relatives for construction of property and will be eligible for Interest exemption under 24B only. The principal will not be eligible for exemption under 80C. Read the FAQ from Income Tax India. There has to be certificate showing how much interest was paid on the said loan. Further there should be records/receipts on how the money was spent. There is difference of opinion amongst CA. It is best you take a professional advise.", "title": "" }, { "docid": "0767e00f54d58b1f0aaf5bea7160f835", "text": "You can take out a personal loan for any reason - to burn the money for fun, if you like. But be aware that you owe it back, not your mother, or anyone else. They will come to you for the repayments.", "title": "" } ]	fiqa
c59cb1d4e09773aff96179b2c87e1127	How can someone with a new job but no credit history get a loan to settle another debt?	[ { "docid": "855d8ad77cb3a8fe38f6b938f1cb5f12", "text": "\"The more I think about this the more I think you are actually better off letting it go to collections. At least then you would be able to agree an affordable repayment schedule based on your real budget, and having a big dent in your credit score because it's gone to collections doesn't actually put you in any worse position (in terms of acquiring credit in the future) than you are now. Whoever is the creditor on your original loan is (IMO) quite unreasonable demanding a payment in full on a given date, especially given that you say you've only been made aware of this debt recently. The courts are usually much more reasonable about this sort of thing and recognise that a payment plan over several years with an affordable monthly payment is MUCH more likely to actually get the creditor their money back than any other strategy. They will also recognise and appreciate that you have made significant efforts to obtain the money. I'm also worried about your statement about how panicked and \"\"ready to give up\"\" you are. Is there someone you can talk to? Around here (UK) we have debt counselling bureaus - they can't help with money for the actual debt itself, but they can help you with strategies for dealing with debt and will explain all parts of the process to you, what your rights and responsibilities are if it does go to court, etc. If you have something similar I suggest you contact them, even just to speak to someone and find out that this isn't the end of the world. It's a sucky situation but in a few years you'll be able to look back and at least laugh wryly at it.\"", "title": "" }, { "docid": "767bed4644935f8672ef4c671b1ab4af", "text": "I believe the best way to go about it is to approach a good friend or relative to borrow the money, interest free. Do discuss with them the repayment schedule. If you have any assets such as house / stocks, you can pledge them in exchange for $5000 cash. I believe the banks would be more than happy to lend to you. You could try one of these Peer to Peer lending sites where you could borrow money from other people instead of banks.", "title": "" } ]	[ { "docid": "073b3eb0dee6ddfc8dd179b6ad9294c0", "text": "This can mean a few things to me. Some of which has been mentioned already. It can mean one (or all) of the following to me: You take out a new credit card and transfer ALL other credit balances to it. (Only good if you destroy the others, this is a 0% offer, AND you plan on paying this card off furiously.) You do the loan thing mentioned earlier. You go to a credit consolidation service who will handle your paying your payments and you send them one payment each month. (Highly discourage using them. A majority of them are shady, and won't get do what they say they will do. Check Better Business Bureau if you find yourself considering them as an option.) In the first two cases, you are just reducing the number of hands reaching into your bank account. But keep in mind, doing this is not the same as paying off debt. You can't borrow your way out. You can do this as part of your plan, but do so CAREFULLY.", "title": "" }, { "docid": "95f8b0a9613586413cfb36902c06e781", "text": "Genius answer: Don't spend more than you make. Pay off your outstanding debts. Put plenty away towards savings so that you don't need to rely on credit more than necessary. Guaranteed to work every time. Answer more tailored to your question: What you're asking for is not realistic, practical, logical, or reasonable. You're asking banks to take a risk on you, knowing based on your credit history that you're bad at managing debt and funds, solely based on how much cash you happen to have on hand at the moment you ask for credit or a loan or based on your salary which isn't guaranteed (except in cases like professional athletes where long-term contracts are in play). You can qualify for lower rates for mortgages with a larger down-payment, but you're still going to get higher rate offers than someone with good credit. If you plan on having enough cash around that you think banks would consider making you credit worthy, why bother using credit at all and not just pay for things with cash? The reason banks offer credit or low interest on loans is because people have proven themselves to be trustworthy of repaying that debt. Based on the information you have provided, the bank wouldn't consider you trustworthy yet. Even if you have $100,000 in cash, they don't know that you're not just going to spend it tomorrow and not have the ability to repay a long-term loan. You could use that $100,000 to buy something and then use that as collateral, but the banks will still consider you a default risk until you've established a credit history to prove them otherwise.", "title": "" }, { "docid": "a2bca858601b7bc24a317dbaf20d6a38", "text": "\"You have a lack of credit history. Lending is still tight since the recession and companies aren't as willing to take a gamble on people with no history. The secured credit card is the most direct route to building credit right now. I don't think you're going to be applicable for a department store card (pointless anyways and encourages wasteful spending) nor the gas card. Gas cards are credit cards, funded through a bank just like any ordinary credit card, only you are limited to gas purchases at a particular retailer. Although gas cards, department store cards and other limited usage types of credit cards have less requirements, in this post-financial crisis economy, credit is still stringent and a \"\"no history\"\" file is too risky for banks to take on. Having multiple hard inquiries won't help either. You do have a full-time job that pays well so the $500 deposit shouldn't be a problem for the secured credit card. After 6 months you'll get it back anyways. Just remember to pay off in full every month. After 6 months you'll be upgraded to a regular credit card and you will have established credit history.\"", "title": "" }, { "docid": "c04766bd3dd7726caf75ff1eeab53a63", "text": "\"Your use of the term \"\"loan\"\" is confusing, what you're proposing is to open a new card and take advantage of the 0% APR by carrying a balance. The effects to your credit history / score will be the following:\"", "title": "" }, { "docid": "7b03ca7b1ba6eb211a8efc1fa0bdf24a", "text": "\"My answer is similar to Ben Miller's, but let me make some slightly different points: There is one excellent reason to get a consolidation loan: You can often get a lower interest rate. If you are presently paying 19% on a credit card and you can roll that into a personal loan at 13.89%, you'll be saving over 5%, which can add up. I would definitely not consolidate a loan at 12.99% into a loan at 13.89%. Then you're just adding 1% to your interest rate. What's the benefit in this? Another good reasons for a consolidation loan is psychological. A consolidation loan with fixed payments forces you to pay that amount every month. You say you have trouble with credit cards. It's very easy to say to yourself, \"\"Oh, just this month I'm going to pay just the minimum so I can use my cash for this other Very Important Thing that I need to buy.\"\" And then next month you find something else that you just absolutely have to buy. And again the next month, and the next, and your determination to seriously pay down your debt keeps getting pushed off. If you have a fixed monthly payment, you can't. You're committed. Also, if you have many credit cards, juggling payments on all of them can get complex and confusing. It's easy to lose track of how much you owe and to budget for payments. At worst, when there are many bills to pay you may forget one. (Personally I now have 3 bank cards, an airline card, and 2 store cards, and managing them is getting out of hand. I have good reasons for having so many cards: the airline card and the store cards give me special discounts. But it's confusing to keep track of.) As to adding $3,000 to the consolidation loan: Very, very bad idea. You are basically saying, \"\"I have to start seriously paying down my debt ... tomorrow. Today I need a some extra cash so I'm going to borrow just a little bit more, but I'm going to get started paying it off next month.\"\" This is a trap, and the sort of trap that leads people into spiraling debt. Start paying off debt NOW, not at some vague time in the future that never seems to come.\"", "title": "" }, { "docid": "982b04c5e536ff4051aaacf79f34c438", "text": "Some lenders will work with you if you contact them early and openly discuss your situation. They are not required to do so. The larger and more corporate the lender, the less likely you'll find one that will work with you. My experience is that your success in working out repayment plan for missed payments depends on the duration of your reduced income. If this is a period of unemployment and you will be able to pay again in a number of months, you may be able to work out a plan on some debts. If you're permanently unable to pay in full, or the duration is too long, you may have to file bankruptcy to save your domicile and transportation. The ethics of this go beyond this forum, as do the specifics of when it is advisable to file bankruptcy. Research your area, find debt counselling. They can really help with specifics. Speak with your lenders, they may be able to refer you to local non-profit services. Be sure that you find one of those, not one of the predatory lenders posing as credit counselling services. There's even some that take the money you can afford to pay, divide it up over your creditors, allowing you to keep accruing late/partial payment fees, and charge you a fee on top of it. To me this is fraudulent and should be cause for criminal charges. The key is open communication with your lenders with disclosure to the level that they need to know. If you're disabled, long term, they need to know that. They do not need to know the specific symptoms or causes or discomforts. They need to know whether the Social Security Administration has declared you disabled and are paying you a disability check. (If this is the case, you probably have a case worker who can find you resources to help negotiate with your creditors).", "title": "" }, { "docid": "8401508cd262c9959657b24535973b9b", "text": "I’ve been in the mortgage business for nearly 15 years. Your question is sort of multi-faceted and I’m surprised by some of these answers I’ve read! Anyway, I digress. Yes, you can be denied even if you have money for a down payment. One of the BIGGEST factors lenders are now required to take into account when approving mortgages now is a person’s “Ability to Repay.” Whether your traditional mortgages like Conventional, FHA, USDA, or VA loans, or even an “in-house” mortgage from a local bank —either way, the lender MUST be able to verify someone’s ability to repay. Your issue is that you won’t have any verifiable income until May. A couple people have answered correctly in that 1) if you have a firm offer letter that can be verified with the employer, and 2) you can use your education/college to substitute for a two year work history as long as you’re graduating with and working in the same line of work. Some programs require proof of 30 days of pay history once you actually start earning paychecks; some programs will use the offer letter as long as you will start earning paychecks within a certain number of days after the note date (basically when the payments start). Also I’m making the assumption that there is some sort of credit history that can be verified. Most lenders want at least a couple of accounts reporting a history just to show good use of credit and showing that you can manage your finances over a longer period of time. Just about every lender has some sort of minimum FICO score requirement. I hope this helps. If you have questions, just reply in a comment.", "title": "" }, { "docid": "db39d960adc97bf1d05e0c089f4b5395", "text": "If you've never had a credit card before a likely reason can be due to lack of credit history. You can apply for a department store card. Nordstroms, Macy's, Target will often grant a small line of credit even with no history. Target would be my first attempt as they have a wide selection of every day items, improving your usage on the card. If you've been denied due to too many applications, then you need to wait 18-24 months for the hard pulls to drop off your credit report before you apply again.", "title": "" }, { "docid": "30aacc07f38e6b5fa8c9dab25168220f", "text": "\"is your credit history ruined, or merely dinged? Is the blow recoverable? Any bad credit rating event is recoverable given enough time / money to solve the problem. As far as \"\"Ruined\"\" vs\"\" \"\"Dinged\"\", well, that's a matter of opinion; some people think that one bad item is the end of the world, others not so much. You will have an unpaid debt listed on your report. This will drop your score. The amount it impacts the score will depend on other factors in your report. Can the carrier try to get the money back in court? I assume you'll wind up dealing with a debt collector. Yes they could go to court, but that's unlikely at least in the short term. Far more likely is that the debt ends up sold to a debt collection agency for pennies on the dollar. The debt collection agency will harass you until you pay and they might file in court if they think the debt is more than enough to cover the court costs. Will this affect any other relationships you have? Possibly. A bad rating may make it more difficult to get credit in the future. However that depends on numerous other factors such as your entire history. It could even prevent you from being hired from certain jobs - not many of them, but some. Is it criminal? Read this: http://www.startribune.com/investigators/95692619.html The US does NOT have a debtors prison. However if the company decides to file a court case and you fail to appear or fail to abide by the court ruling then, in some states, you could be committing a crime and may be thrown in jail. At which point you are on the hook not just for the original fee but potentially a plethora of other costs. Never mind the loss of reputation when your friends, family and coworkers find out that you are sitting in jail. At the end of the day, just pay the debt. If you agreed to the plan and the plan has an early cancellation fee then the moral and ethical thing to do is pay it. Trying to see how bad it would be to ignore it isn't the right way to live.\"", "title": "" }, { "docid": "dc21ff450a0a0809f018f1758627b97f", "text": "\"Sometimes when you are trying to qualify for a loan, the lender will ask for proof of your account balances and costs. Your scheme here could be cause for some questions: \"\"why are you paying $20-30k to your credit card each month, is there a large debt you haven't disclosed?\"\". Or perhaps \"\"if you lost your job, would you be able to afford to continue to pay $20-30k\"\". Of course this isn't a real expense and you can stop whenever you want, but still as a lender I would want to understand this fully before loaning to someone who really does need to pay $20-30k per month. Who knows this might hiding some troublesome issues, like perhaps a side business is failing and you're trying to keep it afloat.\"", "title": "" }, { "docid": "5487351b3c652a93891101150248deb6", "text": "You might also want to talk directly to a bank. If your credit report is clean, they may have some discretion in making the loan. Note - the 'normal' fully qualified loan has two thresholds, 28% (of monthly income) for housing costs, 36% for all debt servicing. A personal, disclosed loan from a friend/family which is not secured against the house, would count as part of the other debt, as would a credit card. While I don't recommend using a credit card for this purpose, the debt fits in that 28-36 gap. As Kevin points out below, not all paths are equally advisable. Nor are rules of thumb always true. Not having the OP's full details, income, assets, price of house, etc, this is just a list of things to consider. The use of a 401(k) loan in the US can be a great idea for some, bad mistake for others. This format doesn't make it easy to go into great detail, and I'm sure the 401(k) loan issue has been asked and answered in other questions. With respect to Kevin, if he wrote 'usually', I'd agree, but never say 'never.'", "title": "" }, { "docid": "6de2264a0a9d82015be6c5d897c27ebd", "text": "I have a car loan paid in full and even paid off early, and 2 personal loans paid in full from my credit union that don't seem to reflect in a positive way and all 3 were in good standing. But you also My credit card utilization is 95%. I have a total of 4 store credit cards, a car loan, 2 personal loans. So assuming no overlap, you've paid off three of your ten loans (30%). And you still have 95% utilization. What would you do if you were laid off for six months? Regardless of payment history, you would most likely stop making payments on your loans. This is why your credit score is bad. You are in fact a credit risk. Not due to payment history. If your payment history was bad, you'd likely rank worse. But simple fiscal reality is that you are an adverse event away from serious fiscal problems. For that matter, the very point that you are considering bankruptcy says that they are right to give you a poor score. Bankruptcy has adverse effects on you, but for your creditors it means that many of them will never get paid or get paid less than what they loaned. The hard advice that we can give is to reduce your expenses. Stop going to restaurants. Prepare breakfast and supper from scratch and bag your lunch. Don't put new expenses on your credit cards unless you can pay them this month. Cut up your store cards and don't shop for anything but necessities. Whatever durables (furniture, appliances, clothes, shoes, etc.) you have now should be enough for the next year or so. Cut your expenses. Have premium channels on your cable or the extra fast internet? Drop back to the minimum instead. Turn the heat down and the A/C temperature up (so it cools less). Turn off the lights if you aren't using them. If you move, move to a cheaper apartment. Nothing to do? Get a second job. That will not only keep you from being bored, it will help with your financial issues. Bankruptcy will not itself fix the problems you describe. You are living beyond your means. Bankruptcy might make you stop living beyond your means. But it won't fix the problem that you make less money than you want to spend. Only you can do that. Better to stop the spending now rather than waiting until bankruptcy makes your credit even worse and forces you to cut spending. If you have extra money at the end of the month, pick the worst loan and pay as much of it as you can. By worst, I mean the one with the worst terms going forward. Highest interest rate, etc. If two loans have the same rate, pay the smaller one first. Once you pay off that loan, it will increase the amount of money you have left to pay off your other loans. This is called the debt snowball (snowball effect). After you finish paying off your debt, save up six months worth of expenses or income. These will be your emergency savings. Once you have your emergency fund, write out a budget and stick to it. You can buy anything you want, so long as it fits in your budget. Avoid borrowing unless absolutely necessary. Instead, save your money for bigger purchases. With savings, you not only avoid paying interest, you may actually get paid interest. Even if it's a low rate, paid to you is better than paying someone else. One of the largest effects of bankruptcy is that it forces you to act like this. They offer you even less credit at worse terms. You won't be able to shop on credit anymore. No new car loan. No mortgage. No nice clothes on credit. So why declare bankruptcy? Take charge of your spending now rather than waiting until you can't do anything else.", "title": "" }, { "docid": "8fbab1cfcd794289936e20efb54c2f83", "text": "I would like to establish credit history - have heard it's useful to gain employment and makes it easy to rent an apartment? Higher credit scores will make it easier with landlords, that's true. As to employment - they do background checks, which means that they usually won't like bad things, but won't care about the good things or no things (they'll know you're a foreigner anyway). Is it safe to assume that this implies I have no history whatsoever? Probably, but you can verify pulling through AnnualCreditReport, don't go around giving your personal information everywhere. Is taking out a secured loan the only way for me? No, but it's one of the easiest. Better would be getting a secured Credit Card, not loan. For loan you'll have to pay interest, for a credit card (assuming you pay off all your purchases immediately) you will only pay the credit card fees (for secured credit cards they charge ~$20-100 yearly fees, so do shop around, the prices vary a lot!). If you're using it wisely, after a year it will be converted to a regular credit card and the collateral will be returned to you with interest (which is actually very competitive, last I heard it was around 2%, twice as much as the online savings accounts). As to a secured loan - you'll be paying 4% to CU for your own money. Doesn't make any sense at all for me. For credit cards you'll at least get some value for your money - convenience, additional fraud protection, etc. The end result will be the same. Usually the credit starts to build up after ~6-12 months (that's why after a year your secured CC will be converted to a regular one). Make sure to have the statement balance in the range of 10-30% of your credit limit, to get the best results. Would it make much better sense to wait till I get a job (then I would have a fixed monthly salary and can apply for a regular CC directly) You can apply, but you'll probably be rejected. As I mentioned in another answer elsewhere, the system in the US is such that you're unable to get credit if you don't already have credit. Which is kindof a magic circle, which you can break with the secured credit card as the least costly solution.", "title": "" }, { "docid": "90aa732c8acaa39ca745a812f96591f0", "text": "Apart from the reasons currently given (which have to do with personal relations), wouldn't a good reason to take the loan from the bank be to build up a credit history and/or improve your credit score?", "title": "" }, { "docid": "982b0e6b01ce7b090e517328f0d42af6", "text": "\"With the scenario that you laid out (ie. 5% and 10% loans), it makes no sense at all. The problem is, when you're in trouble the rates are never 5% or 10%. Getting behind on credit cards sucks and is really hard to recover from. The problem with multiple accounts is that as the banks tack on fees and raise your interest rate to the default rate (usually 30%) when you give them any excuse (late payment, over the limit, etc). The banks will also cut your credit lines as you make payments, making it more likely that you will bump over the limit and be back in \"\"default\"\" status. One payment, even at a slightly higher rate is preferable when you're deep in the hole because you can actually pay enough to hit principal. If you have assets like a house, you'll get a much better rate as well. In a scenario where you're paying 22-25% interest, your minimum payment will be $150-200 a month, and that is mostly interest and penalty. \"\"One big loan\"\" will usually result in a smaller payment, and you don't end up in a situation where the banks are jockeying for position so they get paid first. The danger of consolidation is that you'll stop triggering defaults and keep making your payments, so your credit score will improve. Then the vultures will start circling and offering you more credit cards. EDIT: Mea Culpa. I wrote this based on experiences of close friends whom I've helped out over the years, not realizing how the law changed in 2009. Back around 2004, a single late payment would trigger universal default on most cards, jacking all rates up to 30% and slashing credit lines, resulting in over the limit and other fees. Credit card banks generally apply payments (in order, to interest on penalties, penalties, interest on principal, principal) in a way that makes it very difficult to pay down principal for people deep in debt. They would also offer \"\"payment plans\"\" to entice you to pay Bank B vs. Bank A, which would trigger overlimit fees from Bank A. Another change is that minimum payments were generally 2% of statement balance, which often didn't cover the monthly finance charge. The new law changed that, resulting in a payment of 1% of balance + accrued interest. Under the old regime, consolidation made it less likely that various circumstances would trigger default, and gave the struggling debtor one throat to choke. With the new rules, there are definitely a smaller number of scenarios where consolidation actually makes sense.\"", "title": "" } ]	fiqa
052cf929df6e03c6074ee42b48c68e1a	Can my federal adjusted gross income differ by $1 between my federal and state returns?	[ { "docid": "d3c83935f44ed4f11d6b9b5e623a668d", "text": "No, you don't. Rounding errors happen, and if there's no change in the actual tax there's no reason to amend. If all the income was properly reported and the tax was properly calculated - no-one cares if it was rounded up or down on one of the lines. Note for the next time though: Not sure about New York, but Federal taxes are generally rounded to the nearest dollar on each line of the form. So don't calculate cents, just round to the nearest dollar, and be consistent on all of your tax forms. Technically, it is perfectly legal to report cents as well (and people used to when the forms were still filled by hand with pen), but all the automatic tax filing software rounds, so just do that.", "title": "" } ]	[ { "docid": "de65a195799a90cbf017660532c71024", "text": "Multistate Impact of the American Taxpayer Relief Act of 2012 In general, states with rolling conformity will follow this change. States with specific date conformity will continue to follow the date of conformity currently in effect and will not follow the change. A few states may have their own QSBS rules and will not conform to or be impacted by this provision of the Act. The chart that follows summarizes these principles as applied to the enumerated states: STATE: QSBS Exclusion Conformity: California statutes refer to the IRC QSBS provisions but modify and limit their applicability, and would not be impacted by this provision of the Act. However, California’s provisions were ruled unconstitutional in recent litigation and the California Franchise Tax Board has recently taken the position that gain exclusions and deferrals will be denied for all open tax years. Florida Florida does not impose an income tax on individuals and therefore this provision of the Act is inapplicable and will have no impact. Illinois Due to its rolling conformity, Illinois follows this provision of the Act. Because New York effectively provides for rolling conformity to the IRC, through reference to federal adjusted gross income as the state starting point, New York effectively follows this provision of the Act. Texas does not impose an income tax on individuals", "title": "" }, { "docid": "4384bb6fc4e625759bd324cede2ceccf", "text": "I think you're making a mistake. If you still want to make this mistake (I'll explain later why I think its a mistake), the resources for you are: IRS.GOV - The IRS official web site, that has all the up-to-date forms and instructions for them, guiding publications and the relevant rules. You might get a bit overwhelmed through. Software programs - TurboTax (Home & Business for a sole propriator or single member LLC, Business for more complicated business), or H&R Block Business (only one version that should cover all) are for your guidance. They provide tips and interactive guidance in filling in all the raw data, and produce all the forms filled for you according to the raw data you entered. I personally prefer TurboTax, I think its interface is nicer and the workflow is more intuitive, but that's my personal preference. I wrote about it in my blog last year. Both also include plug-ins for the state taxes (If I remember correctly, for both the first state is included in the price, if you need more than 1 state - there's extra $30-$40 per state). Your state tax authority web site (Minnesota Department of Revenue in your case). Both Intuit and H&R Block have on-line forums where people answer each others questions while using the software to prepare the taxes, you might find useful information there. As always, Google is your friend. Now, why I think this is a mistake. Mistakes that you make - will be your responsibility. If you use the software - they'll cover the calculation mistakes. But if you write income in a wrong specification or take a wrong deduction that you shouldn't have taken - it will be on your head and you're the one to pay the fines and penalties for that. Missed deductions and credits - CPA's (should) know about all the latest deductions and credits that you or your business might be entitled to. They also (should) know which one got canceled and you shouldn't be continuing taking them if you had before. Expenses - there are plenty of rules of what can be written off as an expense and how. Some things should be written off this year, others over several years, for some depreciation formula should be used, etc etc. Tax programs might help you with that, but again - mistakes are your responsibility. Especially for the first time and for the newly formed business, I think you should use a (good!) CPA. The CPA should take responsibility over your filing. The CPA should provide guarantee that based on the documents you provided, he filled all the necessary forms correctly, and will absorb all the fees and penalties if there's an audit and mistakes were found not because you withheld information from your CPA, but because the CPA made a mistake. That costs money, and that's why the CPA's are more expensive than using a program or preparing yourself. But, the risk is much higher, especially for a new business. And after all - its a business expense.", "title": "" }, { "docid": "b10bdd6414d8ba0ada832b28cc52e57a", "text": "\"Don't worry about it. The State doesn't care about rounding error. All you need to do is say \"\"We charge our prices with tax included\"\" - you know, like carnivals and movie theaters. Then follow the procedures your state specifies for computing reportable tax. Quite likely it wants your pre-tax sales total for the reporting period. To get that, total up your gross sales that you collected, and divide by (1 + tax rate). Just like DJClayworth says, except do it on total sales instead of per-item. If you need to do the split per-transaction for Quickbooks or something, that's annoying. What Quickbooks says will be pennies off the method I describe above. The state don't care as long as it's just pennies, or in their favor.\"", "title": "" }, { "docid": "6b044dd19cb2e923618308a758dc7e38", "text": "It also depends on where you work. If you move your home and your job then the date you establish residency in the new state is the key date. All income before that date is considered income for state 1, and all income on or after that date is income for state 2. If there is a big difference in income you will want to clearly establish residency because it impacts your wallet. If they had the same rates moving wouldn't impact your wallet, but it would impact each state. So make sure when going from high tax state to low tax state that you register your vehicles, register to vote, get a new drivers license... It becomes more complex if you move your home but not your job. In that case where you work might be the deciding factor. Same states have agreed that where you live is the deciding factor; in other cases it is not. For Virginia, Maryland, and DC you pay based on where you live if the two states involved are DC, MD, VA. But if you Live in Delaware and work in Virginia Virginia wants a cut of your income tax. So before you move you need to research reciprocity for the two states. From Massachusetts information for Nonresident and Part-Year Resident Income, Exemptions, Deductions and Credits Massachusetts gross income includes items of income derived from sources within Massachusetts. This includes income: a few questions later: Massachusetts residents and part-year residents are allowed a credit for taxes due to any other jurisdiction. The credit is available only on income reported and taxed on a Massachusetts return. Nonresidents may not claim the taxes paid to other jurisdiction credit on their Massachusetts Form 1-NR/PY. The credit is allowed for income taxes paid to: The credit is not allowed for: taxes paid to the U.S. government or a foreign country other than Canada; city or local tax; and interest and penalty paid to another jurisdiction. The computation is based on comparing the Massachusetts income tax on income reported to the other jurisdiction to the actual tax paid to the other jurisdiction; the credit is limited to the smaller of these two numbers. The other jurisdiction credit is a line item on the tax form but you must calculate it on the worksheet in the instruction booklet and also enter the credit information on the Schedule OJC. So if you move your house to New Hampshire, but continue to work in Massachusetts you will owe income tax to Massachusetts for that income even after you move and establish residency in New Hampshire.", "title": "" }, { "docid": "343eb328af1954172314cc6324db1e9a", "text": "If you qualify for the safe harbor, you are not required to pay additional quarterly taxes. Of course, you're still welcome to do so if you're sure you'll owe them; however, you will not be penalized. If your income is over $150k (joint) or $75k (single), your safe harbor is: Estimated tax safe harbor for higher income taxpayers. If your 2014 adjusted gross income was more than $150,000 ($75,000 if you are married filing a separate return), you must pay the smaller of 90% of your expected tax for 2015 or 110% of the tax shown on your 2014 return to avoid an estimated tax penalty. Generally, if you're under that level, the following reasons suggest you will not owe the tax (from the IRS publication 505): The total of your withholding and timely estimated tax payments was at least as much as your 2013 tax. (See Special rules for certain individuals for higher income taxpayers and farmers and fishermen.) The tax balance due on your 2014 return is no more than 10% of your total 2014 tax, and you paid all required estimated tax payments on time. Your total tax for 2014 (defined later) minus your withholding is less than $1,000. You did not have a tax liability for 2013. You did not have any withholding taxes and your current year tax (less any household employment taxes) is less than $1,000. If you paid one-fourth of your last year's taxes (or of 110% of your last-year's taxes) in estimated taxes for each quarter prior to this one, you should be fine as far as penalties go, and can simply add the excess you know you will owe to the next check.", "title": "" }, { "docid": "60133db85fa32dcba648d638d9e7cc85", "text": "Your withholding is taken out of your pay. So if you do YTD+withholding - you count the withholding twice, that's why it doesn't add up for you. The simple answer is to check your written contract/offer letter. See if it matches what you see, or what you expected to see. If the offer/contract states $36K - check with the payroll person at work why the discrepancy. If you don't have any written proof of the agreed amounts (don't know if it is legal, check local laws on the requirements of documenting employment terms), then it is up to you and your employer to sort it out. However, keep in mind: if you don't have any written proof and the employer is unwilling to adjust - one (judge?) would wonder: you've been getting paychecks monthly, which clearly state that your annual salary is $35K. Why did you wait so long to sort this out?", "title": "" }, { "docid": "e14cb4c06d785d9ab927ff0914196dcc", "text": "This is wrong. It should be or Now, to get back to self-employment tax. Self-employment tax is weird. It's a business tax. From the IRS perspective, any self-employed person is a business. So, take your income X and divide by 1.0765 (6.2% Social Security and 1.45% Medicare). This gives your personal income. Now, to calculate the tax that you have to pay, multiply that by .153 (since you have to pay both the worker and employer shares of the tax). So new calculation or they actually let you do which is better for you (smaller). And your other calculations change apace. And like I said, you can simplify Q1se to and your payment would be Now, to get to the second quarter. Like I said, I'd calculate the income through the second quarter. So recalculate A based on your new numbers and use that to calculate Q2i. or Note that this includes income from both the first and second quarters. We'll reduce to just the second quarter later. This also has you paying for all of June even though you may not have been paid when you make the withholding payment. That's what they want you to do. But we aren't done yet. Your actual payment should be or Because Q2ft and Q2se are what you owe for the year so far. Q1ft + Q1se is what you've already paid. So you subtract those from what you need to pay in the second quarter. In future quarters, this would be All that said, don't stress about it. As a practical matter, so long as you don't owe $1000 or more when you file your actual tax return, they aren't going to care. So just make sure that your total payments match by the payment you make January 15th. I'm not going to try to calculate for the state. For one thing, I don't know if your state uses Q1i or Q1pi as its base. Different states may have different rules on that. If you can't figure it out, just use Q1i, as that's the bigger one. Fix it when you file your annual return. The difference in withholding is going to be relatively small anyway, less than 1% of your income.", "title": "" }, { "docid": "ff6db88144e4c3dbec7e59ade40ecefc", "text": "Using a different cost basis than your broker's reporting is NOT a problem. You need to keep your own records to account for this difference. Among the other many legitimate reasons to adjust your cost basis, the most popular is when you have two brokerage accounts and sell an asset in one then buy in another. This is called a Wash Sale and is not a taxable event for you. However from the perspective of each broker with their limited information you are making a transaction with tax implications and their reported 1099 will show as such. Links: https://www.firstinvestors.com/docs/pdf/news/tax-qa-2012.pdf", "title": "" }, { "docid": "62d275defac8a06f8d6040c5a24625cd", "text": "LLC is not a federal tax designation. It's a state-level organization. Your LLC can elect to be treated as a partnership, a disregarded entity (i.e., just report the taxes in your individual income tax), or as an S-Corp for federal tax purposes. If you have elected S-Corp, I expect that all the S-Corp rules will apply, as well as any state-level LLC rules that may apply. Disclaimer: I'm not 100% familiar with S-corp rules, so I can't evaluate whether the statements you made about proportional payouts are correct.", "title": "" }, { "docid": "e7d654a05a0ad811912554f7651690c5", "text": "States have made sales tax more confusing by expanding some categories and shrinking or eliminating other categories. In days of old there were taxes on items, and specific taxes on other small categories such as fuel and cigarets . In many states there were taxes implemented state wide, and in other cases they only applied to a specific city or region. As time went on taxes could be raised to bring in more money for the state or local government, but these tax increase were seen as unfair to the poor. So now the states are modifying and tweaking the tax rates. Some items are tax free, some have a low tax, and some are at the full tax rate. This can get confusing because the type of store can also play a factor. A bag a chips from a grocery store can be treated differently than a bag of chips from a hotdog stand. Some states have also added special taxes on snack foods. In general, purchases they want to encourage (staples from the grocery store) are tax free or low tax, items they don't want to encourage (snacks) are fully taxed. You can also be sure that they will treat luxury items as fully taxed. A new frontier of taxation are ones designed to tax people who don't live there. They have added taxes on restaurants and hotels. Since they are paid by tourists, the people most likely to pay them don't have a voice in setting the rate. States are now wanting to tax services as a way to make up shortfalls in taxing. Don't expect consistency from state to state, or year to year. Oh by the way that penny tax was for something that cost 17 cents or less, unless that item had a lower tax rate. The receipt should clearly identify the taxable items, and their tax level.", "title": "" }, { "docid": "f6c6175038ba86e83de355e5d206f1df", "text": "I was specifically talking about property tax which doesn't increase that much with income. But state and local income taxes ratio makes a lot of sense since there are still lots of people that depend on a salary at 1million$ AGI.", "title": "" }, { "docid": "7b2c743e559c868ee05c1c2d653061c9", "text": "This sort of involves personal finance, and sort of not. But it's an interesting question, so let's call it on topic? Short answer: yes. Long answer: it depends who's asking. If you're trying to qualify for in-state tuition, for example, you need to have been in state for a certain amount of time. For tax purposes, the first year you move to a new state you need to file part-time resident returns in your previous and current state of residency", "title": "" }, { "docid": "e629aeec2a87432b98553c98ecbe93d9", "text": "Ask the company if they can make an adjustment for the next paycheck. If they can't then do the following: Increase the number of Federal exemptions by 1. In 2014 a personal exemption reduces your apparent income by $3950. If you are in the 10 % tax bracket and you are paid every two weeks you will see the amount of taxes withheld drop by ($39500.10/26) or ~$15. The 13 Paychecks later change it back. If you are in the 15 % tax bracket and you are paid every two weeks you will see the amount of taxes withheld drop by ($39500.15/26) or ~$23. Then 9 Paychecks later change it back If you are in the 25 % tax bracket and you are paid every two weeks you will see the amount of taxes withheld drop by ($3950*0.10/26) or ~$38. Then 5 paychecks later change it back. Remember the money isn't gone, it has just been transferred prematurely to the federal treasury. You could also wait until you complete your taxes this spring, then see if you needed to make an adjustment to your exemptions. If you normally get a large refund then you should be increasing your exemptions anyway. If you are always writing a check to the IRS then you weren't getting enough withheld. Also make sure that payroll has the correct numbers. Most companies include the number of federal and state exemptions on the paycheck stub, or the pdf of the stub.", "title": "" }, { "docid": "85794d485be3d23157e21a9378a3e00f", "text": "To start with, I should mention that many tax preparation companies will give you any number of free consultations on tax issues — they will only charge you if you use their services to file a tax form, such as an amended return. I know that H&R Block has international tax specialists who are familiar with the issues facing F-1 students, so they might be the right people to talk about your specific situation. According to TurboTax support, you should prepare a completely new 1040NR, then submit that with a 1040X. GWU’s tax department says you can submit late 8843, so you should probably do that if you need to claim non-resident status for tax purposes.", "title": "" }, { "docid": "6f0cc2e96060ea740329a49fafde29e6", "text": "didn't pay the extra underpayment penalty on the grounds that it was an honest mistake. You seem to think a penalty applies only when the IRS thinks you were trying to cheat the system. That's not the case. A mistake (honest or otherwise) still can imply a penalty. While you can appeal just about anything, on any grounds you like, it's unlikely you will prevail.", "title": "" } ]	fiqa
ae78cdef13fb3eea5a9a3bc90d4fb1a7	Can I get a tax deduction for PMI?	[ { "docid": "65ccaa4f89368ba63ad5e7351753a852", "text": "No. And I'll let my good friend and fellow blogger Kay Bell answer in some detail, in her article Deducting private mortgage insurance.", "title": "" } ]	[ { "docid": "18a2c50ec4b9710426d8038d7ab4b267", "text": "A few things to keep in mind. A 90% mortgage is $76,500, PMI for 10% down is $76,500/2300 = $33/mo. This, plus $557 is still lower than your rent. I'd take the 15 since you want to get rid of that PMI as soon as you can. Often the bank will require the PMI be removed only after the regularly scheduled payments have gotten you to 20% equity, prepayments mat not count. This may have changed recently. Check to be sure. Even in 5 years, you'll save compared to the rent, and from this point, odds are it will increase in value. I'd not count on any tax deduction. Your standard deduction is $11,400. Even at the higher rate, you'd have $3200 in interest, property tax can't be over $2000. You have an easy tax return, I'd say. Good luck. UPDATE - it's now 2016 - The standard deduction is $12,600 for a couple. With the interest maybe at $3200, and property tax at $2000, curious why any other readers would think the OP would be itemizing.", "title": "" }, { "docid": "22f025f3845889d3cc252261cb9cc829", "text": "I will add one point missing from the answers by CQM and THEAO. When you take a loan and invest the proceeds, the interest that you pay on the loan is deductible on Schedule A, Line 14 of your Federal income tax return under the category of Investment Interest Expense. If the interest expense is larger than all your investment earnings (not just those from the loan proceeds), then you can deduct at most the amount of the earnings, and carry over the excess investment interest paid this year for deduction against investment earnings in future years. Also, if some of the earnings are long-term capital gains and you choose to deduct the corresponding investment interest expense, then those capital gains are taxed as ordinary income instead of at the favored LTCG rate. You also have the option of choosing to deduct only that amount of interest that offsets dividend (and short-term capital gain) income that is taxed at ordinary rates, pay tax at the LTCG rate on the capital gains, and carry over rest of the interest for deduction in future years. In previous years when the tax laws called for reduction in the Schedule A deductions for high-income earners, this investment interest expense was exempt from the reduction. Whether future tax laws will allow this exemption depends on Congress. So, this should be taken into account when dealing with the taxes issue in deciding whether to take a loan to invest in the stock market.", "title": "" }, { "docid": "9202be9c1946c1850fefedbc6ea76eb3", "text": "Didn't see it mentioned so far, but depending on modified AGI you may be prevented from a tax deduction for your contribution to a Traditional IRA if you or your spouse are offered a retirement plan at work, even if you don't participate in it. See the IRS page here for the details of deduction limitability: https://www.irs.gov/retirement-plans/2017-ira-deduction-limits-effect-of-modified-agi-on-deduction-if-you-are-covered-by-a-retirement-plan-at-work In my opinion, because I heavily favor all the benefits of the Roth, I'd contribute first to a Roth IRA and then to the Roth 401(k). The former first because it puts the money in a place where you have more control over fees and how it is invested. The latter because the contribution limits are much higher than the IRA, and the money grows tax-free and incurs no taxes on withdrawal.", "title": "" }, { "docid": "0df687f9e6ccd72053a10020ee9f6e67", "text": "\"ASSUMING you're talking about a property in the United States, the answer generally would be \"\"no\"\". You aren't actually paying any of the expenses for the property and yet you want to take the deductions for doing so? That's a rather cheeky move, I'd say! (grin) It probably would lead to some real strife with your brother, since he would have proper claim to those credit on the basis he's the one footing the bills for the property. Before you do anything like what you're talking about, it might be best to speak with him, because both of you are running the very real risk of an audit, and if that happens then I can guarantee the IRS will slap the daylights out of you for it. Your brother, I'm sure, is already claiming all of the deductions he can for what he's putting into the property, and on top of that you want to file for your half. What half are you referring to, when your out-of-pocket is zero? So what you're saying is, you think that between you and your brother you should be able to take a credit of 150% of the actual deductions...Sounds like a recipe for disaster to me. I strongly encourage you to talk to a tax professional, but if you get a different answer to this than what I've already given then I'd be stunned. I hope this helps. Good luck!\"", "title": "" }, { "docid": "b09b1f94fb03bd10155b889cd8f16b08", "text": "\"To claim medical expenses on your taxes they need to exceed 7.5% of your AGI, and then only the amount over 7.5% is deductible. That's not much. There is no \"\"floor\"\" if you use an FSA as it's all pre-tax. If you're concerned about use or lose, then allot less next year. It's all what you're comfortable with.\"", "title": "" }, { "docid": "69f8d8fa5e4e57c53cdf8ac92b680485", "text": "Don't forget to take into account the tax deductability of the interest and PMI into the equation. Of course, this would based on your current pay rate, and your rates after marriage. Your mentioning the flexibility in future changes is also a key aspect to take into consideration.", "title": "" }, { "docid": "3772f20a1d02c1a4ae8fc6aef9e9d331", "text": "\"You can deduct what you pay for your own and your family's health insurance regardless of whether it is subsidized by your employer or not, as well as all other medical and dental expenses for your family, as an itemized deduction on Schedule A of Form 1040, but only to the extent that the total exceeds 7.5% of your Adjusted Gross Income (AGI) (10% on tax returns for year 2013 onwards). As pointed out in KeithB's comment, you cannot deduct any health insurance premium (or other medical expense) that was paid for out of pre-tax dollars, nor indeed can you deduct any medical expense to the extent that it was paid for by the insurance company directly to hospital or doctor (or reimbursed to you) for a covered expense; e.g. if the insurance company reimbursed you $72 for a claim for a doctor's visit for which you paid $100 to the doctor, only $28 goes on Schedule A to be added to the amount that you will be comparing to the 7.5% of AGI threshold, and the $72 is not income to you that needs to be reported on Form 1040. Depending on other items on Schedule A, your total itemized deductions might not exceed the standard deduction, in which case you will likely choose to use the standard deduction. In this case, you \"\"lose\"\" the deduction for medical expenses as well as all other expenses deductible on Schedule A. Summary of some of the discussions in the comments Health care insurance premiums cannot be paid for from HSA accounts (IRS Pub 969, page 8, column 2, near the bottom) though there are some exceptions. Nor can health care insurance premiums be paid from an FSA account (IRS Pub 969, page 17, column 1, near the top). If you have a business on the side and file a Schedule C as a self-employed person, you can buy medical insurance for that business's employees (and their families too, if you like) as an employment benefit, and pay for it out of the income of the Schedule C business, (thus saving on taxes). But be aware that if you have employees other than yourself in the side business, they would need to be covered by the same policy too. You can even decide to pay all medical expenses of your employees and their families too (no 7.5% limitation there!) as an employment benefit but again, you cannot discriminate against other employees (if any) of the Schedule C business in this matter. Of course, all this money that reduced your Schedule C income does not go on Schedule A at all. If your employer permits your family to be covered under its health insurance plan (for a cost, of course), check whether you are allowed to pay for the insurance with pre-tax dollars. The private (non-Schedule C) insurance would, of course, be paid for with post-tax dollars. I would doubt that you would be able to save enough money on taxes to make up the difference between $1330/month and $600/month, but it might also be that the private insurance policy covers a lot less than your employer's policy does. As a rule of thumb, group insurance through an employer can be expected to offer better coverage than privately purchased insurance. Whether the added coverage is worth the additional cost is a different matter. But while considering this matter, keep in mind that privately purchased insurance is not always guaranteed to be renewable, and a company might decline to renew a policy if there were a large number of claims. A replacement policy might not cover pre-existing conditions for some time (six months? a year?) or maybe even permanently. So, do consider these aspects as well. Of course, an employer can also change health insurance plans or drop them entirely as an employment benefit (or you might quit and go work for a different company), but as long as the employer's health plan is in existence, you (and continuing members of your family) cannot be discriminated against and denied coverage under the employer's plan.\"", "title": "" }, { "docid": "f8e65433179d144a0fa508ebc7a70957", "text": "Two points You don't really get the full 10,000 annual interest as tax free income. Well you do, but you would have gotten a substantial amount of that anyway as the standard deduction. ...From the IRS.... Standard deduction The standard deduction for married couples filing a joint return is at $11,900 for 2012. The standard deduction for single individuals and married couples filing separate returns is $5,950 for 2012. The standard deduction for heads of household increases by $50 to $8,700 for 2012. so If you were married it wouldn't even make sense to claim the 10,000 mortgage interest deduction as the standard one is larger. It can make sense to do what you are talking about, but ultimately you have to decide what the effective interest rate on your mortgage is and if you can afford it. For instance. I might have a 5% mortgage. If I am in a 20% tax bracket it effectively is a 4% mortgage to me. Even though I am saving tax money I am still paying effectively 4%. Ultimately the variables are too complex to generalize any hard and fast rules, but it often times does make sense. (You should also be aware that there has been some talk of eliminating or phasing out the mortgage interest deduction as a way to close the deficit and reduce the debt.)", "title": "" }, { "docid": "2e92dac5806716153cdccea6b4a15c79", "text": "I would consult a tax professional for specific help. On my own research, I believe that you could. I know that when I made payments when I was in school for my undergraduate, I made payments on the interest. I believe that I was even told by my financial aid office that I could deduct the interest that I paid. I made not much money so I wasn't anywhere close to the MAGI >75k, but I believe you still could. Not only that but one other thing to consider is that if you have an unsubisidized loan, the interest still accrues when you are in school. In that case, it might be better to make at least some payments. It would save you from the total loan amount ballooning so much while you are in school.", "title": "" }, { "docid": "ef7121e54517f6a7a6f3d61ced60d90a", "text": "It sounded an interesting question, so I looked it up. The reason I asked about the tax years is because it matters. If the bonus was paid, and then returned in the same year - it should not appear on your W2 at all, and your taxes would be calculated accordingly. You might end up with overpayment of FICA taxes, but you can get that credited on your tax return. If, however, the repayment is not in the same year as the payment, it becomes more complicated. The code section that deals with it is 26 USC § 1341. What it says, in short, is this: you can deduct the repaid amount from your current taxable income, but only if its more than $3000. The tax benefit of such deduction cannot exceed the actual tax paid on this in the year when you got the bonus (i.e.: you need to calculate that year with the amount, and without the amount - the credit cannot exceed the difference). But it can also not exceed the amount you would be paying on that amount in the current year (i.e.: if current taxes are less than that year - you lost the difference). If the signing bonus is less than $3000 and it spans across tax years - you cannot deduct it. Bummer.", "title": "" }, { "docid": "309cfe3599915bf4a193f66e589a27ef", "text": "\"You need to do a bit more research and as @littleadv often wisely advises, consult a professional, in this case a tax layer or CPA. You are not allowed to just pull money out of a property and write off the interest. From Deducting Mortgage Interest FAQs If you own rental property and borrow against it to buy a home, the interest does not qualify as mortgage interest because the loan is not secured by the home itself. Interest paid on that loan can't be deducted as a rental expense either, because the funds were not used for the rental property. The interest expense is actually considered personal interest, which is no longer deductible. This is not exactly your situation of course, but it illustrates the restriction that will apply to you. Elsewhere in the article, it references how, if used for a business, the interest deduction still will not apply to the rental, but to the business via schedule C. In your case, it's worse, you can never deduct interest used to fund a tax free bond, or to invest in such a tax favored product. Putting the facts aside, I often use the line \"\"don't let the tax tail wag the investing dog.\"\" Borrowing in order to reduce taxes is rarely a wise move. If you look at the interest on the 90K vs 290K, you'll see you are paying, in effect, 5.12% on the extra 200K, due the higher rate on the entire sum. Elsewhere on this board, there are members who would say that given the choice to invest or pay off a 4% mortgage, paying it off is guaranteed, and the wiser thing to do. I think there's a fine line and might not be so quick to pay that loan off, an after-tax 3% cost of borrowing is barely higher than inflation. But to borrow at over 5% to invest in an annuity product whose terms you didn't disclose, does seem right to me. Borrow to invest in the next property? That's another story.\"", "title": "" }, { "docid": "2b7dca82d5a3566ac7bb43869420fd74", "text": "You understand it perfectly right. The thing with PMI is that when your home price rises (or your loan balance goes down) so that your loan balance is below the 80% of the current house price, the PMI goes away. The higher rate - does not. So, no-PMI option is much better. To the bank, as you suspected. Your calculations are correct. With the PMI you'll pay less interest, and more balance. As to the tax deductions, interest can be deducted, but the PMI - no (starting of 2012, to the best of my understanding, at least). See details here, consult a tax professional for more current information.", "title": "" }, { "docid": "fd9143655557589dc578094881a9b2bf", "text": "Couple of points about being a consultant in the US: It sounds like the rules for what you can deduct may be more lax in Italy. For example, you can deduct a certain percentage of your home for work but the rules are relatively strict on your use of that space and how much is deductible. Also things like clothes, restaurants, phones, car use, etc must follow IRS guidelines to be deductible. This often means they are used exclusively for work and are required for work. A meal you eat by yourself is not generally deductible, for example. Any expense you would have had anyway if you were not working is generally not deductible. A contractor in the US can organize in various ways, including sole proprietorship, an S-corp, and a C-corp. Each has different tax and regulatory implications. In the simple case of a sole proprietorship, one must pay not only regular income tax but also self-employment tax, which is the part of social security and medicare tax normally paid for by one's employer. Estimated taxes must be paid to the government quarterly and then the actual amount due synced up at the end of the year (with the government sending you the difference or vice versa). Generally speaking contractors may set aside more money pre-tax for retirement and have better investment options. This is because solo 401(k) retirement accounts are cost-effective and flexible and the contractor can set aside the full $18K pre-tax as well as having the company contribute generously (pre-tax) to the retirement account. Contractors can also easily employ spouses and set aside even more. The details of how frequently you are paid as a contractor and how much notice (if any) the company must give you before terminating your relationship are negotiated between you and the company and are generally pretty flexible. You could get paid your whole year salary in a lump sum if you wanted. The company that is paying you will not normally give you any benefits whatsoever...in this way it is the same situation as it is in Italy. By the way the three points you mention in your edit are definitely not true in the US.", "title": "" }, { "docid": "7e974e9c76ecdd9f3ffe8704ae2d3f48", "text": "\"How can I avoid this, so we are taxed as if we are making the $60k/yr that we want to receive? You can't. In the US the income is taxed when received, not when used. If you receive 1M this year, taking out 60K doesn't mean the other 940K \"\"weren't received\"\". They were, and are taxable. Create a pension fund in the corporation, feed it all profits, and pay out $60k/yr of \"\"pension\"\". I doubt that the corporation could deduct a million a year in pension funding. You cannot do that. You can only deposit to a pension plan up to 100% of your salary, and no more than $50K total (maybe a little more this year, its adjusted to inflation). Buy a million dollars in \"\"business equipment\"\" of some sort each year to get a deduction, then sell it over time to fund a $60k/yr salary. I doubt such a vehicle exists. If there's no real business purpose, it will be disallowed and you'll be penalized. Your only purpose is tax avoidance, meaning you're trying to shift income using your business to avoid paying taxes - that's illegal. Do crazy Section 79 life insurance schemes to tax-defer the income. The law caps this so I can only deduct < $100k of the $1 million annually, and there are other problems with this approach.\\ Yes. Wouldn't go there. Added: From what I understand, this is a term life insurance plan sponsored by the employer for the employee. This is not a deferral of income, but rather a deduction: instead of paying your term life insurance with your own after tax money, your employer pays with their pre-tax. It has a limit of $50K per employee, and is only available for employees. There are non-discrimination limitations that may affect your ability to use it, but I don't see how it is at all helpful for you. It gives you a deduction, but its money spent, not money in your pocket. End added. Do some tax avoidance like Facebook does with its Double Irish trick, storing the income in some foreign subsidiary and drawing $60k/yr in salary to be taxed at $60k/yr rates. This is probably cost-prohibitive for a $1MM/yr company. You're not Facebook. What works with a billion, will not work with a million. Keep in mind that you're a one-man business, things that huge corporations like Google or Facebook can get away with are a no-no for a sole-proprietor (even if incorporated). Bottom line you'll probably have to pay the taxes. Get a good tax professional to help you identify as much deductions as possible, and if you can plan income ahead - plan it better.\"", "title": "" }, { "docid": "b239ecbe22ac4293f7f0df722ed82b8e", "text": "You cannot deduct. Even if you could, unless you also hold the mortgage, it's unlikely that you would have sufficient deductions to exceed the standard deduction for a married couple.", "title": "" } ]	fiqa
322de9b9b26edaaa351b6af3cb2c855e	Priced out of London property market. What are my accommodation investment options?	[ { "docid": "d640aff8397e2ffdf5af9c49f1b3aa27", "text": "Be radical! (I assume you are not working for a city bank getting paid “city wages” – e.g. you are one of the 99% of people in London or more “normal” income.) House prices and rents in London and anywhere within reasonable commuting distances are now so high that couples in reasonable jobs often have to rent rooms in shared houses (HMOs). This is due to so many people wishing to live/work in London and there not being enough new homes built. If you are looking at buying a property to rent out, you need the rent to be about double the interest payments on the mortgage – otherwise you will not be able to afford repairs, or cope when interest rates increase – (you could also get a tax bill that is more the your profit). Finding such a property is very hard in London, as the prices of homes have gone up a lot more in London then rents have. There are still some flats where the rent will cover the landlord’s costs, but not many. (Any landlord that brought more than a few years ago, is making a very nice profit in London, as the rents have gone up a lot since they brought – but are you willing to bet your life on the rents going up even more?) Moving a short distance out of London, does not help much. So look at somewhere like Manchester or Birmingham", "title": "" }, { "docid": "60aa7183387ee773269ce2401430e4b0", "text": "Real Estate is all local. In the United States, I can show you houses so high the rent on them is less than 1/3% of their value per month, eg. $1M House renting for less than $3500. I can also find 3 unit buildings (for say $200K) that rent for $3000/mo total rents. I might want to live in that house, but buy the triplex to rent out. You need to find what makes sense, and not buy out of impulse. A house to live in and a house to invest have two different sets of criteria. They may overlap, but if the strict Price/Rent were universal, there would be no variation. If you clarify your goal, the answers will be far more valuable.", "title": "" }, { "docid": "b68c9e7304d736d1aa6ba5855c8f9e52", "text": "NB - I live in Surrey and bought my house in January 2014. If you don't have a very social life, it does pay to stay outside London. Places outside London are cheap and you will get a better deal in relation to houses or flats as compared to London. I feel very priced out of the market regarding London mortgages I will strongly question you logic behind this ? Why only London ? Why not live in the commuter belt outside London. Good places to reside, good schools, nice neighbourhood and away from the hustle and bustle of London. Many of my colleagues commute from Cambridge and Oxford daily into Central London and they laugh at people who want to buy a house in London, just for the sake of buying a house. It seems that the housing market is generally in a bubble due to being distorted by the finance market London house market is different from the rest of UK. People from overseas tend to invest in London property market, so it is always inflated. Even the property tax hasn't deterred many. I could look into buying somewhere and renting it out You are trying to join the same people, because of whom you have been put out of the housing market. I strictly question this logic unless your mortgage is less than the rent you pay and what rent you get. Buy a roof over your head first, then think of profiting from property.", "title": "" } ]	[ { "docid": "a62f37b34eba5991155bb33948b3dbf5", "text": "It might some but I'd wager it pushes the short-term rental pricing down (like hotels) while pushing the long-term rental and housing market prices up. If landlords can make way more in short-term rentals they are going to do that and limit the supply of long-term. The tourism sector may have increased revenue but by what extent I don't know. I'd wager that exploding rent and housing prices will negate any benefits for most residents and may end up costing them much more. This is why I think you should only be able to do it on your primary residence. Unless you want to be regulated like a hotel because if you have short-term rentals that you don't reside in, that is effectively what you are. Not being regulated the same as a hotel at that point only gives you an unfair loophole advantage to other short-term rentals.", "title": "" }, { "docid": "47cea5f4c2bd6ef611d52e55975e7338", "text": "I have done something similar to this myself. What you are suggesting is a sound theory and it works. The issues are (which is why it's the reason not everyone does it) : The initial cost is great, many people in their 20s or 30s cannot afford their own home, let alone buy second properties. The time to build up a portfolio is very long term and is best for a pension investment. it's often not best for diversification - you've heard not putting all your eggs in one basket? With property deposits, you need to put a lot of eggs in to make it work and this can leave you vulnerable. there can be lots of work involved. Renovating is a huge pain and cost and you've already mentioned tennants not paying! unlike a bank account or bonds/shares etc. You cannot get to your savings/investments quickly if you need to (or find an opportunity) But after considering these and deciding the plunge is worth it, I would say go for it, be a good landlord, with good quality property and you'll have a great nest egg. If you try just one and see how it goes, with population increase, in a safe (respectable) location, the value of the investment should continue to rise (which it doesn't in a bank) and you can expect a 5%+ rental return (very hard to find in cash account!) Hope it goes well!", "title": "" }, { "docid": "61e08f0d238c2474a7eb648aac96c339", "text": "\"TL;DR - go with something like Barry Ritholtz's All Century Portfolio: 20 percent total U.S stock market 5 percent U.S. REITs 5 percent U.S. small cap value 15 percent Pacific equities 15 percent European equities 10 percent U.S. TIPs 10 percent U.S. high yield corp bonds 20 percent U.S. total bond UK property market are absurdly high and will be crashing a lot very soon The price to rent ratio is certainly very high in the UK. According to this article, it takes 48 years of rent to pay for the same apartment in London. That sounds like a terrible deal to me. I have no idea about where prices will go in the future, but I wouldn't voluntarily buy in that market. I'm hesitant to invest in stocks for the fear of losing everything A stock index fund is a collection of stocks. For example the S&P 500 index fund is a collection of the largest 500 US public companies (Apple, Google, Shell, Ford, etc.). If you buy the S&P 500 index, the 500 largest US companies would have to go bankrupt for you to \"\"lose everything\"\" - there would have to be a zombie apocalypse. He's trying to get me to invest in Gold and Silver (but mostly silver), but I neither know anything about gold or silver, nor know anyone who takes this approach. This is what Jeremy Siegel said about gold in late 2013: \"\"I’m not enthusiastic about gold because I think gold is priced for either hyperinflation or the end of the world.\"\" Barry Ritholtz also speaks much wisdom about gold. In short, don't buy it and stop listening to your friend. Is buying a property now with the intention of selling it in a couple of years for profit (and repeat until I have substantial amount to invest in something big) a bad idea? If the home price does not appreciate, will this approach save you or lose you money? In other words, would it be profitable to substitute your rent payment for a mortgage payment? If not, you will be speculating, not investing. Here's an articles that discusses the difference between speculating and investing. I don't recommend speculating.\"", "title": "" }, { "docid": "570adb7b6e52bfc95319ab740e704f12", "text": "How about a slightly different approach. Invest in a duplex or trip/quadplex. Live in one unit, rent out the rest. Chances are you'll end up either paying nothing in total, or even making money as your tenants pay your bills for you. Depends a lot on your area and your willingness to deal with the crap of tenants, but have a look into it. You'll be surprised what you can buy in your area and the types of people you might end up living with you...", "title": "" }, { "docid": "5a7975f7b904e476239cf8f0dc1eb4de", "text": "\"If I buy property when the market is in a downtrend the property loses value, but I would lose money on rent anyway. So, as long I'm viewing the property as housing expense I would be ok. This is a bit too rough an analysis. It all depends on the numbers you plug in. Let's say you live in the Boston area, and you buy a house during a downtrend at $550k. Two years later, you need to sell it, and the best you can get is $480k. You are down $70k and you are also out two years' of property taxes, maintenance, insurance, mortgage interest maybe, etc. Say that's another $10k a year, so you are down $70k + $20k = $90k. It's probably more than that, but let's go with it... In those same two years, you could have been living in a fairly nice apartment for $2,000/mo. In that scenario, you are out $2k * 24 months = $48k--and that's it. It's a difference of $90k - $48k = $42k in two years. That's sizable. If I wanted to sell and upgrade to a larger property, the larger property would also be cheaper in the downtrend. Yes, the general rule is: if you have to spend your money on a purchase, it's best to buy when things are low, so you maximize your value. However, if the market is in an uptrend, selling the property would gain me more than what I paid, but larger houses would also have increased in price. But it may not scale. When you jump to a much larger (more expensive) house, you can think of it as buying 1.5 houses. That extra 0.5 of a house is a new purchase, and if you buy when prices are high (relative to other economic indicators, like salaries and rents), you are not doing as well as when you buy when they are low. Do both of these scenarios negate the pro/cons of buying in either market? I don't think so. I think, in general, buying \"\"more house\"\" (either going from an apartment to a house or from a small house to a bigger house) when housing is cheaper is favorable. Houses are goods like anything else, and when supply is high (after overproduction of them) and demand is low (during bad economic times), deals can be found relative to other times when the opposite applies, or during housing bubbles. The other point is, as with any trend, you only know the future of the trend...after it passes. You don't know if you are buying at anything close to the bottom of a trend, though you can certainly see it is lower than it once was. In terms of practical matters, if you are going to buy when it's up, you hope you sell when it's up, too. This graph of historical inflation-adjusted housing prices is helpful to that point: let me just say that if I bought in the latest boom, I sure hope I sold during that boom, too!\"", "title": "" }, { "docid": "20da5e3454724a069f2da9ac07b7cca3", "text": "The Motley Fool suggested a good rule of thumb in one of their articles that may be able to help you determine if the market is overheating. Determine the entire cost of rent for a piece of property. So if rent is $300/month, total cost over a year is $3600. Compare that to the cost of buying a similar piece of property by dividing the property price by the rent per year. So if a similar property is $90,000, the ratio would be $90,000/$3600 = 25. If the ratio is < 20, you should consider buying a place. If its > 20, there's a good chance that the market is overheated. This method is clearly not foolproof, but it helps quantify the irrationality of some individuals who think that buying a place is always better than renting. Additionally, Alex B helped me with two additional sources of information for this: Real Estate is local, all the articles here refer to the US housing market. Bankrate says purchase price / annual rate in the US has a long term average of 16.0. Fool says Purchase Price/Monthly Rent: 150 is good buy, 200 starts to get expensive This answer is copy pasted from a similar question (not the same so I did not vote to merge) linked here..", "title": "" }, { "docid": "826957611902dd98805eec54b63208a0", "text": "\"From April 2017 the plan is that there is now also going to be a \"\"Lifetime ISA\"\" (in addition to the Help to Buy ISA). Assuming those plans do not change, they government will give 25% after each year until you are 50, and the maximum you can put in per year will be £4000. Catches: You can only take the money out for certain \"\"life events\"\", currently: Buying a house below £450000 anywhere in the country (not just London). Passing 60 years of age. If you take it out before or for another reason, you lose the government bonus plus 5%, ie. it currently looks like you will be left with 95% of the total of the money you paid in. You cannot use the bonus payments from this one together with bonus payments from a Help to Buy ISA to buy a home. However you can transfer an existing Help to Buy ISA into this one come 2017. While you are not asking about pensions, it is worth mentioning for other readers that while 25% interest per year sounds great, if you use it for pension purposes, consider that this is after tax, so if you pay mostly 20% tax on your income the difference is not that big (and if your employer matches your contributions up to a point, then it may not be worth it). If you pay a significant amount of tax at 40% or higher, then it may not make sense for pension purposes. Tax bands and the \"\"rates\"\" on this ISA may change, of course. On the other hand, if you intend to use the money for a house/flat purchase in 2 or more years' time, then it would seem like a good option. For you specifically: This \"\"only\"\" covers £4000 per year, ie. not the full amount you talked about, but it is likely a good idea for you to spread things out anyway. That way, if one thing turns out to be not as good as other alternatives it has less impact - it is less likely that all your schemes will turn out to be bad luck. Within the M25 the £450000 limit may restrict you to a small house or flat in 5-10 years time. Again, prices may stall as they seem barely sustainable now. But it is hard to predict (measures like this may help push them upwards :) ). On the plus side, you could then still use the money for pension although I have a hard time seeing governments not adjusting this sort of account between now and your 60th birthday. Like pension funds, there is an element of luck/gambling involved and I think a good strategy is to spread things if you can.\"", "title": "" }, { "docid": "d0255b03e9b26ac7886bc7db1ca7075a", "text": "\"I agree with Joe Taxpayer that a lot of details are missing to really evaluate it as an investment... for context, I own a few investment properties including a 'small' 10+ unit apartment complex. My answer might be more than you really want/need, (it kind of turned into Real Estate Investing 101), but to be fair you're really asking 3 different questions here: your headline asks \"\"how effective are Condo/Hotel developments as investments?\"\" An answer to that is... sometimes, very. These are a way for you-the investor-to get higher rents per sq. ft. as an owner, and for the hotel to limit its risks and access additional development funding. By your description, it sounds like this particular company is taking a substantial cut of rents. I don't know this property segment specifically, but I can give you my insight for longer-term apartment rentals... the numbers are the same at heart. The other two questions you're implying are \"\"How effective is THIS condo/hotel development?\"\" and \"\"Should you buy into it?\"\" If you have the funds and the financial wherewithal to honestly consider this, then I am sure that you don't need your hand held for the investment pros/cons warnings of the last question. But let me give you some of my insight as far as the way to evaluate an investment property, and a few other questions you might ask yourself before you make the decision to buy or perhaps to invest somewhere else. The finance side of real estate can be simple, or complicated. It sounds like you have a good start evaluating it, but here's what I would do: Start with figuring out how much revenue you will actually 'see': Gross Potential Income: 365 days x Average Rent for the Room = GPI (minus) Vacancy... you'll have to figure this out... you'll actually do the math as (Vacancy Rate %) x GPI (equals) Effective Potential Income = EPI Then find out how much you will actually pocket at the end of the day as operating income: Take EPI (minus) Operating expenses ... Utilities ... Maintenace ... HOA ... Marketing if you do this yourself (minus) Management Expenses ... 40% of EPI ... any other 'fees' they may charge if you manage it yourself. ... Extra tax help? (minus) Debt Service ... Mortgage payment ... include Insurances (property, PMI, etc) == Net Operating Income (NOI) Now NOI (minus) Taxes == Net Income Net Income (add back) Depreciation (add back) sometimes Mortgage Interest == After-tax Cash Flows There are two \"\"quickie\"\" numbers real estate investors can spout off. One is the NOI, the other is the Cap Rate. In order to answer \"\"How effective is THIS development?\"\" you'll have to run the numbers yourself and decide. The NOI will be based on any assumptions you choose to make for vacancy rates, actual revenue from hotel room bookings, etc. But it will show you how much you should bring in before taxes each year. If you divide the NOI by the asking price of your unit (and then multiply by 100), you'll get the \"\"Cap Rate\"\". This is a rough estimate of the rate of return you can expect for your unit... if you buy in. If you come back and say \"\"well I found out it has a XX% cap rate\"\", we won't really be qualified to help you out. Well established mega investment properties (think shopping centers, office buildings, etc.) can be as low as 3-5 cap rates, and as high as 10-12. The more risky the property, the higher your return should be. But if it's something you like, and the chance to make a 6% return feels right, then that's your choice. Or if you have something like a 15% cap rate... that's not necessarily outstanding given the level of risk (uncertain vacancies) involved in a hotel. Some other questions you should ask yourself include: How much competition is there in the area for short-term lodging? This could drive vacancies up or down... and rents up or down as well How 'liquid' will the property (room) be as an asset? If you can just break even on operating expense, then it might still make sense as an investment if you think that it might appreciate in value AND you would be able to sell the unit to someone else. How much experience does this property management company have... (a) in general, (b) running hotels, and (c) running these kinds of condo-hotel combination projects? I would be especially interested in what exactly you're getting in return for paying them 40% of every booking. Seasonality? This will play into Joe Taxpayer's question about Vacancy Rates. Your profile says you're from TX... which hints that you probably aren't looking at a condo on ski slopes or anything, but if you're looking at something that's a spring break-esque destination, then you might still have a great run of high o during March/April/May/June, but be nearly empty during October/November/December. I hope that helps. There is plenty of room to make a more \"\"exact\"\" model of what your cash flows might look like, but that will be based on assumptions and research you're probably not making at this time.\"", "title": "" }, { "docid": "466a1871498eb91d7f62f46feb6fa2e8", "text": "The other thing to remember is seasonality. Just because monthly rent is $900/month doesn't guarantee that you'll bring in $900/month. Plenty of university towns have peak demand during the months of Aug/Sept when students are moving in, but you have to beg//plead//give discounted rent to keep units full during 'off-season' times. Assuming vacancy during 3 months/year, your average monthly rent is only $675. ($900 * 9 / 12) This may change the economics of your investment.", "title": "" }, { "docid": "20ae132d01516ae7c708aed732a616e1", "text": "Surely the yield should be Yield = (Rent - Costs) / Downpayment ? As you want the yield relative to your capital not to the property value. As for the opportunity cost part you could look at the risk free rate of return you could obtain, either through government bonds or bank accounts with some sort of government guarantee (not sure what practical terms are for this in Finland). The management fee is almost 30% of your rent, what does this cover? Is it possible to manage the property yourself, as this would give you a much larger cushion between rent and expenses.", "title": "" }, { "docid": "9b390ab2b8987ad3f27153fc997b8bea", "text": "This is a bit of an open-ended answer as certain assumptions must be covered. Hope it helps though. My concern is that you have 1 year of university left - is there a chance that this money will be needed to fund this year of uni? And might it be needed for the period between uni and starting your first job? If the answer is 'yes' to either of these, keep any money you have as liquid as possible - ie. cash in an instant access Cash ISA. If the answer is 'no', let's move on... Are you likely to touch this money in the next 5 years? I'm thinking house & flat deposits - whether you rent or buy, cars, etc, etc. If yes, again keep it liquid in a Cash ISA but this time, perhaps look to get a slightly better interest rate by fixing for a 1 year or 2 year at a time. Something like MoneySavingExpert will show you best buy Cash ISAs. If this money is not going to be touched for more than 5 years, then things like bonds and equities come into play. Ultimately your appetite for risk determines your options. If you are uncomfortable with swings in value, then fixed-income products with fixed-term (ie. buy a bond, hold the bond, when the bond finishes, you get your money back plus the yield [interest]) may suit you better than equity-based investments. Equity-based means alot of things - stocks in just one company, an index tracker of a well-known stock market (eg. FTSE100 tracker), actively managed growth funds, passive ETFs of high-dividend stocks... And each of these has different volatility (price swings) and long-term performance - as well as different charges and risks. The only way to understand this is to learn. So that's my ultimate advice. Learn about bonds. Learn about equities. Learn about gilts, corporate bonds, bond funds, index trackers, ETFs, dividends, active v passive management. In the meantime, keep the money in a Cash ISA - where £1 stays £1 plus interest. Once you want to lock the money away into a long-term investment, then you can look at Stocks ISAs to protect the investment against taxation. You may also put just enough into a pension get the company 'match' for contributions. It's not uncommon to split your long-term saving between the two routes. Then come back and ask where to go next... but chances are you'll know yourself by then - because you self-educated. If you want an alternative to the US-based generic advice, check out my Simple Steps concept here (sspf.co.uk/seven-simple-steps) and my free posts on this framework at sspf.co.uk/blog. I also host a free weekly podcast at sspf.co.uk/podcast (also on iTunes, Miro, Mixcloud, and others...) They were designed to offer exactly that kind of guidance to the UK for free.", "title": "" }, { "docid": "865a5ea962ecbf23aa7d29e646c44738", "text": "\"I think the real answer to your question here is diversification. You have some fear of having your money in the market, and rightfully so, having all your money in one stock, or even one type of mutual fund is risky as all get out, and you could lose a lot of your money in such a stock-market based undiversified investment. However, the same logic works in your rental property. If you lose your tennant, and are unable to find a new one right away, or if you have some very rare problem that insurance doesn't cover, your property could become very much not a \"\"break even\"\" investment very quickly. In reality, there isn't any single investment you can make that has no risk. Your assets need to be balanced between many different market-investments, that includes bonds, US stocks, European stocks, cash, etc. Also investing in mutual funds instead of individual stocks greatly reduces your risk. Another thing to consider is the benefits of paying down debt. While investments have a risk of not performing, if you pay off a loan with interest payments, you definitely will save the money you would have paid in interest. To be specific, I'd recommend the following plan -\"", "title": "" }, { "docid": "de2f8020f2afe5a02fa537ebb9f85250", "text": "\"To be completely honest, I think that a target of 10-15% is very high and if there were an easy way to attain it, everyone would do it. If you want to have such a high return, you'll always have the risk of losing the same amount of money. Option 1 I personally think that you can make the highest return if you invest in real estate, and actively manage your property(s). If you do this well with short term rental and/or Airbnb I think you can make healthy returns BUT it will cost a lot of time and effort which may diminish its appeal. Think about talking to your estate agent to find renters, or always ensuring your AirBnB place is in good nick so you get a high rating and keep getting good customers. If you're looking for \"\"passive\"\" income, I don't think this is a good choice. Also make sure you take note of karancan's point of costs. No matter what you plan for, your costs will always be higher than you think. Think about water damage, a tenant that breaks things/doesn't take care of stuff etc. Option 2 I think taking a loan is unnecessarily risky if you're in good financial shape (as it seems), unless you're gonna buy a house with a mortgage and live in it. Option 3 I think your best option is to buy bonds and shares. You can follow karancan's 100 minus your age rule, which seems very reasonable (personally I invest all my money in shares because that's how my father brought me up, but it's really a matter of taste. Both can be risky though bonds are usually safer). I think I should note that you cannot expect a return of 10% or more because, as everyone always says, if there were a way to guarantee it, everyone would do it. You say you don't have any idea how this works so I'd go to my bank and ask them. You probably have access to private banking so that should mean someone will be able to sit you down and talk you through. Also look at other banks that have better rates and/or pretend you're leaving your bank to negotiate a better deal. If I were you I'd invest in blue chips (big international companies listed on the main indeces (DAX, FTSE 100, Dow Jones)), or (passively managed) mutual funds/ETFs that track these indeces. Just remember to diversify by country and industry a bit. Note: i would not buy the vehicles/plans that my bank (no matter what they promise, and they promise a lot) suggest because if you do that then the bank always takes a cut off your money. TlDr, dont expect to make 10-15% on a passive investment and do what a lot of others do: shares and bonds. Also make sure you get a lot of peoples opinions :)\"", "title": "" }, { "docid": "f34b5a00e27f0cd229ddb1bd5f026e18", "text": "I am also from Malaysia and I just purchase a property around Klang Valley area. Property market is just like share market. You will never know when is the highest peak point and when is the lowest peak point. Yes. Not only you, but everyone of us. What I would say that, just buy according to your need and your financial status. If you feel that you need a comfortable place to stay rather than renting a room, and buying that property will not burden your financial status too much, why not go for it? The best time to purchase property is perhaps last year when world economic is down turn. But thing is over and can never go back. Since all of us don't have a crystal ball to tell the future, why not just act according to your heart and common sense (Buy according to need) ;)", "title": "" }, { "docid": "05a2138741e77745d300937c6e2e859a", "text": "\"I assume you've no debt - if you do then pay that off. I'd be tempted to put the money into property. If you look at property prices over the past 20 years or so, you can see returns can be very good. I bought a house in 1998 and sold it in 2003 for about 110% of the purchase price. Disclaimer, past performance is no guarantee of future returns! It's a fairly low risk option, property prices appear to be rising currently and it's always good to get your foot on the housing ladder as quickly as you can as prices can rise to the stage where even those earning quite a good salary cannot afford to buy. Of course you don't have to live in the house, a rental income can be very handy without tying you down too much. There are plenty of places in the UK where £60k will buy you a reasonable property with a rental income of £400-£500, it doens't have to be near where you live currently. Just to put a few more figures in - if you get a house for £50k and rent it for £400 a month (perfectly feasible where I live) then that's very close to a 10% return year on year. Plus any gains made by the price of the house. The main downside is you won't have easy access to the money and you will have to look after a tenant if you decide to rent it out. Also if you do buy a property make sure it is in a good state of repair, you don't want to have to pay for a new roof for example in a couple of years time. Ideally you would then sell the house around the time property prices peak and buy another when they bottom out again. Not easy to judge though! I'd review the Trust Fund against others if you decide to keep it there as 12% over 6 years isn't great, although the stock market has been depressed so it may compare favouribly. Keep some \"\"rainy day\"\" money spare if you can.\"", "title": "" } ]	fiqa
28e29db1a78a9ec6e2dd985996f02d3c	What is a mutual fund “high water mark” and how does it affect performance fees?	[ { "docid": "312fbf872c83d106346f1b676f5175db", "text": "With the caveat that you should always read the fine print... Generally, the high water mark is the absolute highest mark at end of any quarter (sometimes month) over all the quarters (months) in the past. Intra-quarter marks don't matter. So, in your example the mark at the end of the second quarter would only be the new HWM if that mark is higher then the mark at the end of every previous quarter. Again, what happened in the middle of of the second quarter doesn't matter. For hedge funds, the HWM may only be be from the date you started investing rather than over the whole history of the fund, but I would be surprised if that was true for any mutual funds. Though, as I may have mentioned, it is worth reading the fine print.", "title": "" } ]	[ { "docid": "398e0210b897b26b43d1e3f1a3761f2f", "text": "It says expense ratio of 0.14%. What does it mean? Essentially it means that they will take 0.14% of your money, regardless of the performance. This measures how much money the fund spends out of its assets on the regular management expenses. How much taxes will I be subject to This depends on your personal situation, not much to do with the fund (though investment/rebalancing policies may affect the taxable distributions). If you hold it in your IRA - there will be no taxes at all. However, some funds do have measures of non-taxable distributions vs dividends vs. capital gains. Not all the funds do that, and these are very rough estimates anyway. What is considered to be a reasonable expense ratio? That depends greatly on the investment policy. For passive index funds, 0.05-0.5% is a reasonable range, while for actively managed funds it can go up as much as 2% and higher. You need to compare to other funds with similar investment policies to see where your fund stands.", "title": "" }, { "docid": "3b758cc9b01b3c40ca56a7c8367938dc", "text": "A mutual fund has several classes of shares that are charged different fees. Some shares are sold through brokers and carry a sales charge (called load) that compensates the broker in lieu of a fee that the broker would charge the client for the service. Vanguard does not have sales charge on its funds and you don't need to go through a broker to buy its shares; you can buy directly from them. Admiral shares of Vanguard funds are charged lower annual expenses than regular shares (yes, all mutual funds charge expenses for fund adninistration that reduce the return that you get, and Vanguard has some of the lowest expense ratios) but Admiral shares are available only for large investments, typically $50K or so. If you have invested in a Vanguard mutual fund, your shares can be set to automatically convert to Admiral shares when the investment reaches the right level. A mutual fund manager can buy and sell stocks to achieve the objectives of the fund, so what stockes you are invested in as a share holder in a mutual fund will typically be unknown to you on a day-to-day basis. On the other hand, Exchange-traded funds (ETFs) are fixed baskets of stocks, and you can buy shares in the ETF. These shares are bought and sold through a broker (so you pay a transaction fee each time) but expenses are lower since there is no manager to buy and sell stocks: the basket is fixed. Many ETFs follow specific market indexes (e.g. S&P 500). Another difference between ETFs and mutual funds is that you can buy and sell ETFs at any time of the day just as if you could if you held stocks. With mutual funds, any buy and sell requests made during the day are processed at the end of the day and the value of the shares that you buy or sell is determined by the closing price of the stocks held by the mutual fund. With ETFs, you are getting the intra-day price at the time the buy or sell order is executed by your broker.", "title": "" }, { "docid": "675a70aadcb10c31e3cc28eca8b61c0c", "text": "Brokers will have transaction fees in addition to the find management fees, but they should be very transparent. Brokering is a very competitive business. Any broker that added hidden fees to their transactions would lose customers very quickly to other brokers than can offer the same services. Hedge funds are a very different animal, with less regulation, less transparency, and less competition. Their fees are tolerated because the leveraged returns are usually much higher. When times are bad, though, those fees might drive investors elsewhere.", "title": "" }, { "docid": "256728116ce855af89d29eb93f353f63", "text": "I'm of the belief that, long term, fees eat away at your performance. If you chose an ETF, say VOO, with its .05% expense, and a short term bond fund or money market fund, you are going be ahead, long term. It's pretty much accepted fact that money managers are not beating the average long term. For you to simply do as well as I do (S&P less .05%) your guy has to beat the market year in, year out, by 1.2%. Not going to happen. Yes, in hindsight, some funds have done this. Over the decades, losing funds are closed, or merged into performing ones. But, in the end, the average fund lags the average market return quite a bit. To pay someone 25% over two decades isn't what I'd recommend to anyone. There was recently a PBS Frontline special, The Retirement Gamble, (and this link to my article reviewing the show). I put up an image which shows the effect of 50 years' impact of expenses. The Vanguard S&P ETF, linked earlier has just a .05% fee. In my chart I show .1%, and then a total 1% or 2% fee. $447K return for .1%, $294K for 1%. I'm painfully aware that 3/4 of US taxpayers aren't saving at all. For those that are savers, the value in learning about investing is huge. This isn't a onetime $150K saved, but the savings on just that $10K deposit. Meanwhile, before you learn this, a pay-for-his-time fee-only planner is worth it, for a meeting and first year follow up.", "title": "" }, { "docid": "eeae47327398ea15c73b93538235cb5f", "text": "\"Do mutual funds edit/censor underperforming investments to make their returns look better, and if so, is there any way one can figure out if they are doing it? No, that's not what the quote says. What the quote says is that the funds routinely drop investments that do not bring the expected return, which is true. That's their job, that is what is called \"\"active management\"\". Obviously, if you're measuring the fund by their success/failure to beat the market, to beat the market the funds must consistently select over-performers. No-one claims that they only select over-performers, but they select enough of them (or not...) for the average returns to be appealing (or not...) for the investors.\"", "title": "" }, { "docid": "e1be62ce02096d39859cc6bb774405f7", "text": "The fee representing the expense ratio is charged as long as you hold the investment. It is deducted daily from the fund assets, and thus reduces the price per share (NAV per share) that is calculated each day after the markets close. The investment fee is charged only when you make an investment in the fund. So, invest in the fund in one swell foop (all $5500 or $6500 for older people, all invested in a single transaction) rather than make monthly investments into the fund (hold the money in a money-market within your Roth IRA if need be). But, do check if there are back-end loads or 12b1 fees associated with the fund. The former often disappear after a few years; the latter are another permanent drain on performance. Also, please check whether reinvestment of dividends and capital gains incur the $75 transaction fee.", "title": "" }, { "docid": "35c459b8792369297e41681430c55724", "text": "Mutual funds are collections of investments that other people pay to join. It would be simpler to calculate the value of all these investments at one time each day, and then to deem that any purchases or sales happen at that price. The fund diversifies rather than magnifies risk, looking to hold rather than enjoy a quick turnaround. Nobody really needs hourly updated price information for an investment they intend to hold for decades. They quote their prices on a daily basis and you take the daily price. This makes sense for a vehicle that is a balanced collection of many different assets, most of which will have varying prices over the course a day. That makes pricing complicated. This primer explains mutual fund pricing and the requirements of the Investment Company Act of 1940, which mandates daily price reporting. It also illustrates the complexity: How does the fund pricing process work? Mutual fund pricing is an intensive process that takes place in a short time frame at the end of the day. Generally, a fund’s pricing process begins at the close of the New York Stock Exchange, normally 4 p.m. Eastern time. The fund’s accounting agent, which may be an affiliated entity such as the fund’s adviser, or a third-party servicer such as the fund’s administrator or custodian bank, is usually responsible for calculating the share price. The accounting agent obtains prices for the fund’s securities from pricing services and directly from brokers. Pricing services collect securities prices from exchanges, brokers, and other sources and then transmit them to the fund’s accounting agent. Fund accounting agents internally validate the prices received by subjecting them to various control procedures. For example, depending on the nature and extent of its holdings, a fund may use one or more pricing services to ensure accuracy. Note that under Rule 22c-1 forward pricing, fund shareholders receive the next daily price, not the last daily price. Forward pricing makes sense if you want shareholders to get the most accurate sale or purchase price, but not if you want purchasers and sellers to be able to make precise calculations about gains and losses (how can you be precise if the price won't be known until after you buy or sell?).", "title": "" }, { "docid": "78324133f5ee24f7ae0dc6de65f65c25", "text": "I strongly suggest you go to www.investor.gov as it has excellent information regarding these types of questions. A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt. The combined holdings of the mutual fund are known as its portfolio. Investors buy shares in mutual funds. Each share represents an investor’s part ownership in the fund and the income it generates. When you buy shares of a mutual fund you're buying it at NAV, or net asset value. The NAV is the value of the fund’s assets minus its liabilities. SEC rules require funds to calculate the NAV at least once daily. Different funds may own thousands of different stocks. In order to calculate the NAV, the fund company must value every security it owns. Since each security's valuation is changing throughout the day it's difficult to determine the valuation of the mutual fund except for when the market is closed. Once the market has closed (4pm eastern) and securities are no longer trading, the company must get accurate valuations for every security and perform the valuation calculations and distribute the results to the pricing vendors. This has to be done by 6pm eastern. This is a difficult and, more importantly, a time consuming process to get it done right once per day. Having worked for several fund companies I can tell you there are many days where companies are getting this done at the very last minute. When you place a buy or sell order for a mutual fund it doesn't matter what time you placed it as long as you entered it before 4pm ET. Cutoff times may be earlier depending on who you're placing the order with. If companies had to price their funds more frequently, they would undoubtedly raise their fees.", "title": "" }, { "docid": "e3ad56de12a1e57eee094f285039e940", "text": "\"I hope a wall of text with citations qualifies as \"\"relatively easy.\"\" Many of these studies are worth quoting at length. Long story short, a great deal of research has found that actively-managed funds underperform market indexes and passively-managed funds because of their high turnover and higher fees, among other factors. Longer answer: Chris is right in stating that survivorship bias presents a problem for such research; however, there are several academic papers that address the survivorship problem, as well as the wider subject of active vs. passive performance. I'll try to provide a brief summary of some of the relevant literature. The seminal paper that started the debate is Michael Jensen's 1968 paper titled \"\"The Performance of Mutual Funds in the Period 1945-1964\"\". This is the paper where Jensen's alpha, the ubiquitous measure of the performance of mutual fund managers, was first defined. Using a dataset of 115 mutual fund managers, Jensen finds that The evidence on mutual fund performance indicates not only that these 115 mutual funds were on average not able to predict security prices well enough to outperform a buy-the-market-and-hold policy, but also that there is very little evidence that any individual fund was able to do significantly better than that which we expected from mere random chance. Although this paper doesn't address problems of survivorship, it's notable because, among other points, it found that managers who actively picked stocks performed worse even when fund expenses were ignored. Since actively-managed funds tend to have higher expenses than passive funds, the actual picture looks even worse for actively managed funds. A more recent paper on the subject, which draws similar conclusions, is Martin Gruber's 1996 paper \"\"Another puzzle: The growth in actively managed mutual funds\"\". Gruber calls it \"\"a puzzle\"\" that investors still invest in actively-managed funds, given that their performance on average has been inferior to that of index funds. He addresses survivorship bias by tracking funds across the entire sample, including through mergers. Since most mutual funds that disappear are merged into existing funds, he assumes that investors in a fund that disappear choose to continue investing their money in the fund that resulted from the merger. Using this assumption and standard measures of mutual fund performance, Gruber finds that mutual funds underperform an appropriately weighted average of the indices by about 65 basis points per year. Expense ratios for my sample averaged 113 basis points a year. These numbers suggest that active management adds value, but that mutual funds charge the investor more than the value added. Another nice paper is Mark Carhart's 1997 paper \"\"On persistence in mutual fund performance\"\" uses a sample free of survivorship bias because it includes \"\"all known equity funds over this period.\"\" It's worth quoting parts of this paper in full: I demonstrate that expenses have at least a one-for-one negative impact on fund performance, and that turnover also negatively impacts performance. ... Trading reduces performance by approximately 0.95% of the trade's market value. In reference to expense ratios and other fees, Carhart finds that The investment costs of expense ratios, transaction costs, and load fees all have a direct, negative impact on performance. The study also finds that funds with abnormally high returns last year usually have higher-than-expected returns next year, but not in the following years, because of momentum effects. Lest you think the news is all bad, Russ Wermer's 2000 study \"\"Mutual fund performance: An empirical decomposition into stock‐picking talent, style, transactions costs, and expenses\"\" provides an interesting result. He finds that many actively-managed mutual funds hold stocks that outperform the market, even though the net return of the funds themselves underperforms passive funds and the market itself. On a net-return level, the funds underperform broad market indexes by one percent a year. Of the 2.3% difference between the returns on stock holdings and the net returns of the funds, 0.7% per year is due to the lower average returns of the nonstock holdings of the funds during the period (relative to stocks). The remaining 1.6% per year is split almost evenly between the expense ratios and the transaction costs of the funds. The final paper I'll cite is a 2008 paper by Fama and French (of the Fama-French model covered in business schools) titled, appropriately, \"\"Mutual Fund Performance\"\". The paper is pretty technical, and somewhat above my level at this time of night, but the authors state one of their conclusions bluntly quite early on: After costs (that is, in terms of net returns to investors) active investment is a negative sum game. Emphasis mine. In short, expense ratios, transaction costs, and other fees quickly diminish the returns to active investment. They find that The [value-weight] portfolio of mutual funds that invest primarily in U.S. equities is close to the market portfolio, and estimated before fees and expenses, its alpha is close to zero. Since the [value-weight] portfolio of funds produces an α close to zero in gross returns, the alpha estimated on the net returns to investors is negative by about the amount of fees and expenses. This implies that the higher the fees, the farther alpha decreases below zero. Since actively-managed mutual funds tend to have higher expense ratios than passively-managed index funds, it's safe to say that their net return to the investor is worse than a market index itself. I don't know of any free datasets that would allow you to research this, but one highly-regarded commercial dataset is the CRSP Survivor-Bias-Free US Mutual Fund Database from the Center for Research in Security Prices at the University of Chicago. In financial research, CRSP is one of the \"\"gold standards\"\" for historical market data, so if you can access that data (perhaps for a firm or academic institution, if you're affiliated with one that has access), it's one way you could run some numbers yourself.\"", "title": "" }, { "docid": "86065a94b974b282b797961feefbdebc", "text": "Vanguard (and probably other mutual fund brokers as well) offers easy-to-read performance charts that show the total change in value of a $10K investment over time. This includes the fair market value of the fund plus any distributions (i.e. dividends) paid out. On Vanguard's site they also make a point to show the impact of fees in the chart, since their low fees are their big selling point. Some reasons why a dividend is preferable to selling shares: no loss of voting power, no transaction costs, dividends may have better tax consequences for you than capital gains. NOTE: If your fund is underperforming the benchmark, it is not due to the payment of dividends. Funds do not pay their own dividends; they only forward to shareholders the dividends paid out by the companies in which they invest. So the fair market value of the fund should always reflect the fair market value of the companies it holds, and those companies' shares are the ones that are fluctuating when they pay dividends. If your fund is underperforming its benchmark, then that is either because it is not tracking the benchmark closely enough or because it is charging high fees. The fact that the underperformance you're seeing appears to be in the amount of dividends paid is a coincidence. Check out this example Vanguard performance chart for an S&P500 index fund. Notice how if you add the S&P500 index benchmark to the plot you can't even see the difference between the two -- the fund is designed to track the benchmark exactly. So when IBM (or whoever) pays out a dividend, the index goes down in value and the fund goes down in value.", "title": "" }, { "docid": "04f3a1490966002444e5a4cb61978175", "text": "Imagine that a fund had a large exit load that declined over several years. If you wanted to sell some or all of your investment in that fund you would face a large fee, unless you held it a long time. You would be hesitant to sell because waiting longer would save you money. That is the exact opposite of a liquid investment. Therefore the ideal level for a liquid fund is to have zero exit load.", "title": "" }, { "docid": "2a0af1c2c1b6c26dbc6f6d137d149688", "text": "There are several things being mixed up in the questions being asked. The expense ratio charged by the mutual fund is built into the NAV per share of the fund, and you do not see the charge explicitly mentioned as a deduction on your 401k statement (or in the statement received from the mutual fund in a non-401k situation). The expense ratio is listed in the fund's prospectus, and should also have been made available to you in the literature about the new 401k plan that your employer is setting up. Mutual fund fees (for things like having a small balance, or for that matter, sales charges if any of the funds in the 401k are load funds, God forbid) are different. Some load mutual funds waive the sales charge load for 401k participants, while some may not. Actually, it all depends on how hard the employer negotiates with the 401k administration company who handles all the paperwork and the mutual fund company with which the 401k administration company negotiates. (In the 1980s, Fidelity Magellan (3% sales load) was a hot fund, but my employer managed to get it as an option in our plan with no sales load: it helped that my employer was large and could twist arms more easily than a mom-and-pop outfit or Solo 401k plan could). A long long time ago in a galaxy far far away, my first ever IRA contribution of $2000 into a no-load mutual fund resulted in a $25 annual maintenance fee, but the law allowed the payment of this fee separately from the $2000 if the IRA owner wished to do so. (If not, the $25 would reduce the IRA balance (and no, this did not count as a premature distribution from the IRA). Plan expenses are what the 401k administration company charges the employer for running the plan (and these expenses are not necessarily peanuts; a 401k plan is not something that needs just a spreadsheet -- there is lots of other paperwork that the employee never gets to see). In some cases, the employer pays the entire expense as a cost of doing business; in other cases, part is paid by the employer and the rest is passed on to the employees. As far as I know, there is no mechanism for the employee to pay these expenses outside the 401k plan (that is, these expenses are (visibly) deducted from the 401k plan balance). Finally, with regard to the question asked: how are plan fees divided among the investment options? I don't believe that anyone other than the 401k plan administrator or the employer can answer this. Even if the employer simply adopts one of the pre-packaged plans offered by a big 401k administrator (many brokerages and mutual fund companies offer these), the exact numbers depend on which pre-packaged plan has been chosen. (I do think the answers the OP has received are rubbish).", "title": "" }, { "docid": "3434f214ebf6ea235e1f6dc952df5914", "text": "\"How does [FINRA's 5% markup policy] (http://www.investopedia.com/study-guide/series-55/commissions-and-trade-complaints/finra-5-markup-policy/) affect the expense/profit/value of an ETF/Mutual Fund? An extreme example to illustrate: If my fund buys 100 IBM @ 100, The fund would credit the broker $10,000 for those shares and the broker would give the fund 100 shares. Additionally there would be some sort of commission (say $10) paid on top of the transaction which would come out of the fund's expense ratio. But the broker is \"\"allowed\"\" to charge a 5% markup. So that means, that $100 price that I see could have hit the tape at $95 (assume 5% markup which is allowed). Thus, assuming that the day had zero volatility for IBM, when the fund gets priced at the end of the day, my 100 shares which \"\"cost\"\" 10,000 (plus $10) now has a market value of $9,500. Is that how it \"\"could\"\" work? That 500 isn't calculated as part of the expense of the fund is it? (how could it be, they don't know about the exact value of the markup).\"", "title": "" }, { "docid": "bdcf05dafe8669ec0c776f77e15f1190", "text": "Yes you should take in the expenses being incurred by the mutual fund. This lists down the fees charged by the mutual fund and where expenses can be found in the annual statement of the fund. To calculate fees and expenses. As you might expect, fees and expenses vary from fund to fund. A fund with high costs must perform better than a low-cost fund to generate the same returns for you. Even small differences in fees can translate into large differences in returns over time. You don't pay expenses, so the money is taken from the assets of the fund. So you pay it indirectly. If the expenses are huge, that may point to something i.e. fund managers are enjoying at your expense, money is being used somewhere else rather than being paid as dividends. If the expenses are used in the growth of the fund, that is a positive sign. Else you can expect the fund to be downgraded or upgraded by the credit rating agencies, depending on how the credit rating agencies see the expenses of the fund and other factors. Generally comparison should be done with funds invested in the same sectors, same distribution of assets so that you have a homogeneous comparison to make. Else it would be unwise to compare between a fund invested in oil companies and other in computers. Yes the economy is inter twined, but that is not how a comparison should be done.", "title": "" }, { "docid": "e84cd2c651028a05ae4854b7cd8d985e", "text": "\"[Wrong](http://www.cnbc.com/id/44516166/Are_Hedge_Fund_Fees_Justified) \"\"hedge fund managers were asked to justify their standard two percent management, and twenty percent performance fees.\"\" 9/14/2011 [Wrong #2](http://www.bloomberg.com/news/2011-09-07/wealthy-investors-keep-paying-hedge-fund-fees-even-with-anemic-returns.html) 9/6/2011 \"\"Wealthy investors who put money in hedge funds face high fees, usually a 2 percent management fee and a 20 percent performance fee\"\"\"", "title": "" } ]	fiqa
4389218f387fa6bf33a8197a6d5447ca	Auto insurance on new car	[ { "docid": "94879e15d3965ff10dffe5aaac5ff8f4", "text": "Auto insurance is a highly personalized item, so depending on your driving record and other factors, $600 a month for full coverage may be as good as you can get. Look at the premium for each category, and consider raising the deductible if you have some savings that could be used in the event that you have a claim. Also, you're not only buying insurance to cover the other person's damage and medical expenses, you're paying for insurance for your car. Brand-new cars are more expensive to replace (and thus insure) than used cars. Leasing is effectively renting a car for a long period of time. While the payments are less, when the lease expires you're going to have to decide whether to give up the car or buying it, usually at a price much higher than market value. I'm glad you discovered that the insurance would break your budget before it's too late. My suggestion would be to look for a 1-2 year old car that's less expensive to buy and to insure.", "title": "" }, { "docid": "fb0edd08bd90a5e1c0f13f4535eae1ae", "text": "$600 a month is high, but may be the best you can do. When I moved from UK to Canada my first insurance quote was $3000 a year, but that was 20 years ago and I was older than 27. The rates go down substantially after you have had a local license for a few years. Best tips for minimising this:", "title": "" } ]	[ { "docid": "fefd8a210ced706b82098af84e1c8d3b", "text": "Considering I'm putting 30% down and having my father cosign is there any chance I would be turned down for a loan on a $100k car? According to BankRate, the average credit score needed to buy a new car is 714, but they also show average interest rates at 6.39% for new-car loans to people with credit scores in the 601-660 range. High income certainly helps offset credit score to some extent. Not every bank/dealership does things the same way. Being self-employed you'd most likely be required to show 2 years of tax returns, and they'd use those as a basis for your income rather than whatever you have made recently. If using a co-signer, their income matters. Another key factor is debt to income ratio, if too much of someone's income is already spoken for by other debts a lender will shy away. So, yes, there's a chance, given all the information we don't know and the variability with lender policies, that you could be turned down for a car loan. How should I go about this? If you're set on pursuing the car loan, just go talk to some lenders. You'll want to shop around for a good rate anyway, so no need to speculate just go find out. Include the dealership as a potential financing option, they can have great rates. Personally, I'd get a much cheaper car. Your insurance premium on a 100k car will be quite high due to your age. You might be rightly confident in your earning potential, but nothing is guaranteed, situations can change wildly in short order. A new car is not a good investment or a value-retaining asset, so why bother going into debt for one if you don't have to? If you buy something in cash now, you could upgrade in a few years without financing if your earning prediction holds and would save quite a bit in car insurance and interest over the years between.", "title": "" }, { "docid": "080d0f2b00d0613a800275de5fabfde1", "text": "This greatly depends on the local laws and the insurance contract terms. If I remember correctly, my own life insurance policy does also have special terms in case I die within a year of applying, so it doesn't sound totally bogus. For car loan insurance, the amount of coverage and premiums were probably low enough for the insurer not to want to spend the money upfront on the thorough investigation, but they probably do have a clause that covers them in case the insured passes away unreasonably quickly (unreasonably for a healthy person of the given age, that is).", "title": "" }, { "docid": "4b23ee969f1e4e4d90e43db4458c3090", "text": "\"The system of comparison and calculation of insurance rates seems completely and utterly flawed to me. Why would you group cars from different manufacturers together by arbitrarily defined factors such as weight and size? It is perfectly possible to have a big, heavy car with very low claims, while a small car can have a lot more claims. The response provided by Tesla seems similarly moronic. They claim that their car is being compared to the wrong types of car, but even if that were the case - so what? If the other cars you are being compared to are too cheap/slow/small, then you have obviously been assigned to the wrong group, and should be in another group with the bigger, more expensive cars, which I would gather are even more expensive to insure, and thus your car should be more expensive to insure. If an insurance company is providing insurance to 1000 Volvo XC 90 drivers and 1000 Tesla Model S drivers and they get 100 claims from the Volvo drivers costing them a total of $ 200,000, while they get 150 claims from the Tesla drivers totaling $ 300,000 during the same time period, obviously the Tesla should be 50 % more expensive to insure. That is literally how car insurance works. Here in Germany, every model of car is assigned a unique identifier (\"\"Typschlüsselnummer\"\", roughly translates as \"\"type number\"\" or \"\"type identifier\"\"). Insurance companies track which cars their clients own, and report condensed claims statistics for each model back to a central service provider, which then assigns an insurance group (Typklasse) to each car for each type of insurance (there are distinct, independent groups for liability, partial and comprehensive coverage) depending on the actual, measured per-car expenditures experienced by the insurance companies over the previous year. The insurance companies then feed that data back into their systems for their rate calculations.\"", "title": "" }, { "docid": "934db7ebe0f517eaa0042ab40cbaf8e8", "text": "Totally agree. Autonomous cars can increase margins in the insurance industry since there will be fewer claims. for Geico - less administration and higher margins. Buffet is probably ecstatic. Edit: Not saying that this is in the best interests of the public, but if insurers can get away with it I'm sure they'll try.", "title": "" }, { "docid": "151409bd98f97fac15cdbd4298f7cc45", "text": "At minimum, put down the sale price less what insurance would pay if you got in an accident when driving home, OR purchase gap insurance. This auto loan calculator is fun to play around with. The larger the down payment, the smaller your monthly payments will be. Don't forget to budget insurance and gas! Insurance on a car you make payments on is more expensive. http://www.bankrate.com/calculators/auto/auto-loan-calculator.aspx A buddy of mine had a string of bad luck and totaled his car a few months after the date of purchase. He learned what it meant to be 'underwater', insurance paid him a few thousand less than the value of his loan. What's worse than having no car, having no car and a loan!", "title": "" }, { "docid": "0f06c64f3954dc1ce53ca1017d37773a", "text": "\"I've lived this decision, and from my \"\"anecdata\"\": do #3 I have been car-free since 2011 in a large United States city. I was one month into a new job on a rail line out in the suburbs, and facing a $3000 bill to pass state inspection (the brakes plus the emissions system). I live downtown. I use a combination of transit, a carshare service, and 1-2 day rentals from full service car rental businesses (who have desks at several downtown hotels walking distance from my house). I have not had a car insurance policy since 2011; the carshare includes this and I pay $15 per day for SLI from full service rentals. I routinely ask insurance salesmen to run a quote for a \"\"named non-owner\"\" policy, and would pull the trigger if the premium cost was $300/6 months, to replace the $15/day SLI. It's always quoted higher. In general, our trips have a marginal cost of $40-100. Sure, this can be somewhat discouraging. But we do it for shopping at a warehouse club, visiting parents and friends in the suburbs. Not every weekend, but pretty close. But with use of the various services ~1/weekend, it's come out to $2600 per year. I was in at least $3200 per year operating the car and often more, so there is room for unexpected trips or the occasional taxi ride in cash flow, not to mention the capital cost: I ground the blue book value of the car from $19000 down to $3600 in 11 years. Summary: Pull the trigger, do it :D\"", "title": "" }, { "docid": "118e30c236baaf251dc30cec23787e9e", "text": "Even if you avoid the issue of the auto dealer wanting to limit the abuse of their policy, you have to realize that the discount they give is 25% off of some stated price. It might be 25% off the sticker. They don't want to lose money, the 25% represents the haggling they avoid by selling to the employee. This means the discount might not be as large as you imagine, because you wouldn't have paid sticker if you had purchased the vehicle on your own. The other issue you will have to deal with is taxes and registration. When your friend drives the car off the lot, the car will have to be registered with the state. Then they will have to sell the car to you, and that transaction will have to be done though the state, for a price. Then you will sell it to somebody else. These transaction fees will cut into your profits. It is likely that when the potential purchaser runs a VIN check through a service it will show multiple owners, which can cut the estimated resale value. The manufacturer will also have to be notified so that all the relevant warranty coverage is still intact. The question is for that final sale: can you offer enough discount compared to the new car dealer? and still make enough profit to be worth the hassle?", "title": "" }, { "docid": "4c3516aa08cebd9b101fbf920ebe743b", "text": "Does the Insurance value differ from state to state (for example I've a car in Hawaii and there is another car in Illinois with same model, make and same features), does the Insurance vary for both? Yes, quotes will vary based on where you live for various reasons, (propensity for accidents, value of cars, etc.), and state laws regarding required car insurance can vary. How is the insurance quote calculated? It's likely a proprietary formula that the insurance company will not disclose. If they did, they could be giving away a competitive advantage. However, like all insurance, the goal is to determine the probability of the insured having an accident, and the projected cost of such an accident. That will be based on actuarial tables for each of the risk factors you mention.", "title": "" }, { "docid": "5dc0a3dea63d8bb1ed57dea1db6825d4", "text": "\"Insurance rates are based on statistics manipulated by experts in actuarial \"\"science\"\". Actuaries look at how many times different makes and models get into accidents or are targeted by thieves, and how expensive it is to repair them. Many auto and finance sites will publish lists of the best and worst insurance risks. Family style cars like minivans and family sedans fair well, while sports cars get more expensive insurance. New models will get the risk of similar models until there is statistical data on them. One other take away from this discussion is that inexpensive insurance usually coincides with cheap repair costs, lowering your total cost of operation for your vehicle.\"", "title": "" }, { "docid": "ed9e547c7fe50befd984c0eaa6a63f05", "text": "The best way to do this is to pay for the entire car, including gas, insurance, and repairs, from S-corp funds, then meticulously track how many miles are used for personal and how many miles for business. If you pay with S-corp funds, you will claim the personal miles as a taxable benefit from the S-corp on your personal return. The S-corp can then claim all the expenses and depreciation on the vehicle, reducing the S-corp's tax liability.", "title": "" }, { "docid": "ba1fbcb5b6de5bf4d70c78c1731ee206", "text": "I don't see how anyone could give you a hard-and-fast formula, unless they know where to get some applicable statistics. Because several factors here are not a straight calculation. If you don't replace the tires but keeping driving the car, what is the increased probability that you will get into an accident because of the bald tires? How much will bald tires vs new tires affect the selling price of the car? Presumably the longer you drive the car after getting new tires, the less increase this will give to the market value of the car. What's the formula for that? If you keep the car, what's the probability that it will have other maintenance problems? Etc. That said, it's almost always cheaper to keep your current car than to buy a new one. Even if you have maintenance problems, it would have to be a huge problem to cost more than buying a new car. Suppose you buy a $25,000 car with ... what's a typical new car loan these days? maybe 5 years at 5%? So your payments would be about $470 per month. If you compare spending $1000 for new tires versus paying $470 per month on a new car loan, the tires are cheaper within 3 months. The principle is the same if you buy with cash. To justify buying a new car you have to factor in the value of the pleasure you get from a new car, the peace of mind from having something more reliable, etc, mostly intangibles.", "title": "" }, { "docid": "d535b4ae8f1aafbfce3194559a4bcadc", "text": "Don't be afraid to shop around. Every couple of years when it's time to renew my auto insurance I call a couple of places to see if I can get a better deal. It's especially important to do this as you get older (because your rates go down assuming you keep a clean driving record). Also as your life changes, e.g. if you get married, move, buy a home, get a new car, etc. At 30 my rates dropped a lot. When I bought a home, I qualified for a discount by combining my home and auto insurance through the same carrier. My suggestion would be to call 3 insurance companies for quotes, all on the same day. You'll need to be able to identify the car you'll be insuring for the most accurate quote. Do you belong to any organizations that offer insurance discounts? (E.g. my college alumni association had a program with one of the larger carriers that had the best rates on auto+home that I could find.)", "title": "" }, { "docid": "b19e8b2b32147e2fd88aaead43284ebe", "text": "For each liability, you should insure to the risk. A $150k home should be insured for that amount plus contents. Same for your car, if you want to insure for damages, fine, but liability is mandatory. It's not about what you want to spend but how to not take on more risk than nescesary and not over insure which is just wasteful.", "title": "" }, { "docid": "6c8a6c05c6d1e543cb0dedd72e683077", "text": "insurance premiums My annual car premium always caught me off guard until I set up a dedicated savings account for it.", "title": "" }, { "docid": "8d3eef26be24ff71bbe382f829bf25fe", "text": "If you buy a new car, the odds that it will require repairs are fairly low, and if it does, they should be covered by the warranty. If you buy a used car, there is a fair chance that it will need some sort of repairs, and there probably is no warranty. But think about how much repairs are likely to cost. A new car these days costs like $25,000 or more. You can find reasonably decent used cars for a few thousand dollars. Say you bought a used car for $2,000. Is it likely that it will need $23,000 in repairs? No way. Even if you had to make thousands of dollars worth of repairs to the used car, it would almost certainly be cheaper than buying a new car. I've bought three used vehicles in the last few years, one for me, one for my son, and one for my daughter. I paid, let's see, I think between $4,000 and $6,000 each. We've had my son's car for about 9 months and to date had $40 in repairs. My daughter's car turned out to have a bunch of problems; I ended up putting maybe another $2,000 into it. But now she's got a car she's very happy with that cost me maybe $6,000 between purchase and repairs, still way less than a new car. My pickup had big time problems, including needing a new transmission and a new engine. I've put, hmm, maybe $7,000 into it. It's definitely debatable if it was worth replacing the engine. But even at all that, if I had bought that truck new it would have cost over $30,000. Presumably if I bought new I would have had a nicer vehicle and I could have gotten exactly the options I wanted, so I'm not entirely happy with how this one turned out, but I still saved money by buying used. Here's what I do when I buy a used car: I go into it expecting that there will be repairs. Depending on the age and condition of the car, I plan on about $1000 within the first few months, probably another $1000 stretched out over the next year or so. I plan for this both financially and emotionally. By financially I mean that I have money set aside for repairs or have available credit or one way or another have planned for it in my budget. By emotionally I mean, I have told myself that I expect there to be problems, so I don't get all upset when there are and start screaming and crying about how I was ripped off. When you buy a used car, take it for granted that there will be problems, but you're still saving money over buying new. Sure, it's painful when the repair bills hit. But if you buy a new car, you'll have a monthly loan payment EVERY MONTH. Oh, and if you have a little mechanical aptitude and can do at least some of the maintenance yourself, the savings are bigger. Bear in mind that while you are saving money, you are paying for it in uncertainty and aggravation. With a new car, you can be reasonably confidant that it will indeed start and get you to work each day. With a used car, there's a much bigger chance that it won't start or will leave you stranded. $2,000 is definitely the low end, and you say that that would leave you no reserve for repairs. I don't know where you live or what used cars prices are like in your area. Where I live, in Michigan, you can get a pretty decent used car for about $5,000. If I were you I'd at least look into whether I could get a loan for $4,000 or $5,000 to maybe get a better used car. Of course that all depends on how much money you will be making and what your other expenses are. When you're a little richer and better established, then if a shiny new car is important to you, you can do that. Me, I'm 56 years old, I've bought new cars and I've bought used cars and I've concluded that having a fancy new car just isn't something that I care about, so these days I buy used.", "title": "" } ]	fiqa
b9e2ff6acf7b34b6a9f29b79ef914fad	Auto Loan and Balance Transfer	[ { "docid": "9dde985625769ca6e58e3689b8cde07a", "text": "This is what your car loan would look like if you paid it off in 14 months at the existing 2.94% rate: You'll pay a total of about $277 in interest. If you do a balance transfer of the $10,000 at 3% it'll cost you $300 up front, and your payment on the remaining $5,000 will be $363.74 to pay it off in the 14 month period. Your total monthly payment will be $1,099.45; $5,000 amortized at 2.94% for 14 months plus $10,300 divided by 14. ($363.74 + 735.71). Your interest will be about $392, $300 from the balance transfer and $92 from the remaining $5,000 on the car loan at 2.94%. Even if your lender doesn't credit your additional payment to principal and instead simply credits future payments, you'd still be done in 15 months with a total interest expense of about $447. So this additional administration and additional loan will save you maybe about $55 over 14 or 15 months.", "title": "" } ]	[ { "docid": "303588b49013c7679b9fa2bf9d544700", "text": "\"From my experience, payments from banks and other financial entities, such as loyalty programs, generally aren't as large as payments that go the other direction from consumer to bank. Thus, keeping a bank account open simply for some reward/loyalty points may just be changing your behavior for the wrong reasons. The more important scenario is whether or not you have any automated ACH payments or whether your bank account is linked to other services. Perhaps the biggest tell that you're in the clear is when those transactions start occurring from your credit union account. For example: If you had a direct deposit to your BMO bank account, make sure you see deposits start to appear in the credit union account. If you're making automatic withdraws to an online savings or brokerage account, make sure those transfers are stopped and that you instead see them coming out of your new credit union account. You shouldn't need to move the auto loan, but you will need to make sure you can pay it from the new account. Some financial advisors, such as in this BankRate article titled, Lenders can tap bank account for mortgage, even recommend keeping liabilities and assets at different locations. If for whatever reason your financial situation turned bleak, it would be more difficult for the bank to help itself to what's in your checking account. To avoid getting nickel and dimed to death by \"\"payment processing fees\"\", I tend to pay insurance bills yearly or semi-annually. Thus, consider if there is anything that may be coming due in the next 6 months. If so, you might want to get your new account hooked up while you still have all the routing numbers and account numbers in your head. It's a pain to dig this stuff up while also rushing to not be late. If all that is in order, close the account.\"", "title": "" }, { "docid": "ac5e3eceb0f3f7efed7542521895e212", "text": "I have gotten a letter of credit from my credit union stating the maximum amount I can finance. Of course I don't show the dealer the letter until after we have finalized the deal. I Then return in 3 business days with a cashiers check for the purchase price. In one case since the letter was for an amount greater then the purchase price I was able drive the car off the lot without having to make a deposit. In another case they insisted on a $100 deposit before I drove the car off the lot. I have also had them insist on me applying for their in-house loan, which was cancelled when I returned with the cashiers check. The procedure was similar regardless If I was getting a loan from the credit union, or paying for the car without the use of a loan. The letter didn't say how much was loan, and how much was my money. Unless you know the exact amount, including all taxes and fees,in advance you can't get a check in advance. If you are using a loan the bank/credit Union will want the car title in their name.", "title": "" }, { "docid": "e9e6d1066b0894a91a07f1d1fa7bcba8", "text": "An auto title loans are typically utilized by those that wish to obtain a funding with bad credit rating or no credit in any way. An auto-mobile title lending frequently called a vehicle title lending or merely title funding as well as pink slip funding’s. You merely should have a vehicle that is paid off or nearly paid off and also you could make use of the auto title as security to obtain the cash money you require, enabling you to continue driving your vehicle while paying your loan. Get Auto Title Loans in Victorville CA and nearby cities Provide Car Title Loans, Auto Title Loans, Mobile Home Title Loans, RV/Motor Home Title Loans, Big Rigs Truck Title Loans, Motor Cycle Title Loans, Online Title Loans Near me, Bad Credit Loans, Personal Loans, Quick cash Loans Contact Us: Get Auto Title Loans Victorville CA 17100-B Bear Valley Rd # 504, Victorville, CA 92395 760-493-2711 gatlvvca@gmail.com http://getautotitleloans.com/car-and-auto-title-loans-victorville-ca/", "title": "" }, { "docid": "46d088082b5ee9ff77070a77368d46f6", "text": "I don't understand the calculations in the comments by the OP. He says My monthly savings after mandatory expense is around USD 2000. This includes rent, expenses, emergency fund savings, and the monthly required payment of my auto loan. (emphasis added) He has $2000 USD left over after monthly expenses (which includes rent, food, utilities etc, contribution towards emergency funds, and the required monthly payment on the auto loan). He claims that by applying the $2000 USD per month towards reducing the debt, it would take him 30-36 months to be debt-free. But is it not the case that applying the $2000 to the student loan of $18K+ (while continuing to make the auto loan payments) will pay the student loan off in less than 10 months? If no payments are made on that $18K+ student loan, the accrued interest of about $2K in 10 months (this is (18.2513.7%)(10/12) for a total of $20K+). In actuality, with the loan being paid down, the interest will be much less. Once the student loan is paid off, the extra $2000 can go towards what is left of the $10K auto loan each month and pay it off in another 4 or 5 months or so. So we are talking of 15 months max instead of 30-36 months. Of course, as Carlos Briebiescas points out, the car is more valuable as an asset than can be sold in case of job loss creating a need for cash etc, and so paying it off first might be better, but that is a different calculation.", "title": "" }, { "docid": "070c75485707c1305fe5f0e7f18c6520", "text": "I used to work for Ally Auto (formerly known as GMAC) and I'd advise not to pay off the account unless you need to free up some debt in your credit report since until the account is paid off it will show that you owe your financial institution the original loan amount. The reason why I am saying not to pay-off the account is because good/bad payments are sent to the credit bureau 30 days after the due date of the payment, and if you want to increase your credit score then its best to pay it on a monthly basis, the negative side to this is you will pay more interest by doing this. If ever you decide to leave $1.00 in loan, I am pretty much sure that the financial institution will absorb the remaining balance and consider the account paid off. What exactly is your goal here? Do you plan to increase your credit score? Do you need to free up some debt?", "title": "" }, { "docid": "500a2e4390c95d1355fd370b677acfd3", "text": "Possession is 9/10 of the law, and any agreement between you and your grandfather is covered under the uniform commercial code covering contracts. As long as your fulfilling your obligation of making payments, the contract stands as originally agreed upon between you and the lender. In short, the car is yours until you miss payments, sell it, or it gets totalled. The fact that your upside down on value to debt isn't that big of a deal as long as you have insurance that is covering what is owed.", "title": "" }, { "docid": "f20c565456d604db8ccfa9d1dbcb0f82", "text": "As a former banker, the title of the car will be assigned to the loan account holder(s) because legally, he/she/they are responsible for payments. I've never heard of any case where the car title differs from the loan account holder(s). Throughout my career in the bank, I've come across quite a number of parents who did the same for their children and the car title was always assigned to the loan account holder's name. You do have a choice of applying for a joint loan with one of your parents unless if you are concerned about what your credit score might be. Once the loan has been paid off, the title could be changed to your name from your parents of course. As for insurance, there are numerous options where the insurance would cover all drivers of the car however at a slightly higher price like you've mentioned.", "title": "" }, { "docid": "7593b6bdcf44efdad9f4c548a8207cf3", "text": "\"I'd lean toward using the $3,000 from the emergency fund although depending on your monthly bills, a $2,000 emergency fund (or even a $5,000 one) may be a bit small. But here are a couple of other options for you: Zero-interest balance transfers: If you have cards and have a zero balance on them, your credit card companies are keen to see you put a balance on them. Find out if they're offering any \"\"12 months no interest on balance transfers\"\" offers (or if any of their rivals is), since of course the car loan is an outstanding balance you can transfer (you're not asking them for cash). Put the $3,000 on that zero-balance transfer option, get rid of the car, and pay the $300/mo to pay down the balance on the card. 10 months later, two months before the end of the free period, you're at zero again — without dipping into your emergency fund. You'll also now have a history with that card company of paying back, which may lead them to attempt to entice you to go into more debt (which you'll resist, of course) by increasing the limit. (If you don't want a higher limit, just tell them to reduce it again.) A $3,000 unsecured loan with no pre-payment penalty provided the math works out. The interest may be expensive (unless you find something with a teaser rate for the first X months), but if you find an option, do the math on it to see if it's actually more expensive than carrying the car payments, insurance, etc. on a depreciating asset. It may not be as expensive as the 20% rate or whatever makes it sound (but again, do the math), and if you apply your $300/mo to it, within (say) 11 months you're clear again — with a nice little paid-back loan on your credit report. Both of these ensure that you still have your emergency fund at your disposal, and both capitalize on the fact that right now, you're probably a good credit risk. If you dip into your emergency fund, and an emergency happens (like loss of a job) and you find yourself short of funds, you may have trouble securing further credit at that point to cover the gap in your emergency fund.\"", "title": "" }, { "docid": "c59b0cebec63a91223960ef08c299029", "text": "A lender will look at three things when giving a loan: Income. Do you make enough money each month to afford the payments. They will subtract from your income any other loans, credit card debt, student loan debt, mortgage. They will also figure in your housing costs. Your Collateral. For a mortgage the collateral is the house, for a car loan it is the car. They will only give you a loan to a specific percentage of the value of the collateral. Your money in the bank isn't collateral, but it can serve as a down payment on the loan. Your Credit score. This is a measure of how well you handle credit. The longer the history the better. Using credit wisely is better than not using the credit you have. If you don't have a credit card, get one. Start with your current bank. You have a history with them. If they won't help you join a credit union. Another source of car loans is the auto dealer. Though their rates can be high. Make sure that the purchase price doesn't require a monthly payment too high for your income. Good rules of thumb for monthly payments are 25% for housing and 10% for all other loans combined. Even a person with perfect credit can't get a loan for more than the bank thinks they can afford. Note: Don't drain all your savings, you will need it to pay for the unexpected expenses in life. You might think you have enough cash to pay off the student loan or to make a big down payment, but you don't want to stretch yourself too thin.", "title": "" }, { "docid": "1b45c7e6a0aa16d13a1411268ae1350b", "text": "An auto title loans are typically utilized by those that wish to obtain a funding with bad credit rating or no credit in any way. An auto-mobile title lending frequently called a vehicle title lending or merely title funding as well as pink slip funding’s. You merely should have a vehicle that is paid off or nearly paid off and also you could make use of the auto title as security to obtain the cash money you require, enabling you to continue driving your vehicle while paying your loan. Get Auto Car Title Loans Torrance CA and nearby cities Provide Car Title Loans, Auto Title Loans, Mobile Home Title Loans, RV/Motor Home Title Loans, Big Rigs Truck Title Loans, Motor Cycle Title Loans, Online Title Loans Near me, Bad Credit Loans, Personal Loans, Quick cash Loans Contact Us: Get Auto Car Title Loans Torrance CA 1148 W Clarion Dr, Torrance, CA 90502 Phone : 424-306-1531 Email : atltorrance@gmail.com http://getautotitleloans.com/car-and-auto-title-loans-torrance-ca", "title": "" }, { "docid": "cbb6ec7a1888247441acb6231540199b", "text": "\"Played \"\"the balance transfer game\"\" once recently, just as a reference - Got a balance transfer offer for a sock drawer no-AF card. 2% up-front fee, 0% APR. Grace period was, by the time I acted on it, about 16 months. Used it to pay down an auto loan with an APR slightly higher than 2%, and brought my equity back to positive. Towards the end when I rolled over the auto loan, thanks to the positive equity I was offered a rate discount on the new loan. Essentially this was a piggyback loan on the original auto loan funded by credit card (via balance transfer). Saved some interest charges without having to refinance.\"", "title": "" }, { "docid": "3f033ab4c1714f26c112ed3af1388189", "text": "I am new to the site and hope I can help! We just purchased a used car a few weeks ago and used dealer's finance again so that's not the issue here. I want to focus on what you can do to resolve your issue and not focus on the mistakes that were made. 1 - DO NOT PURCHASE A NEW CAR! Toyota Camrys are great cars that will last forever. I live in Rochester, NY and all you need is snow tires for the winter as ChrisInEdmonton suggested. This will make a world of difference. Also, when you get a car wash get an under-spray treatment for salt and rust (warm climate cars don't usually come with this treatment). 2 - Focus on paying this loan off. Pay extra to the monthly note, put any bonuses you get to the note. Take lunches to work to save money so you can pay extra. I'm not sure if you put any money down but your monthly note should be around $300? I would try putting $400+ down each month until it is paid off. Anything you can do. But, do not buy a new car until this one is fully paid off! Let me know if this helps! Thanks!", "title": "" }, { "docid": "e6bf0329cade75454187b0320816ddc2", "text": "\"One part of the equation that I don't think you are considering is the loss in value of the car. What will this 30K car be worth in 84 months or even 60 months? This is dependent upon condition, but probably in the neighborhood of $8 to $10K. If one is comfortable with that level of financial loss, I doubt they are concerned with the investment value of 27K over the loan of 30K @.9%. I also think it sets a bad precedent. Many, and I used to be among them, consider a car payment a necessary evil. Once you have one, it is a difficult habit to break. Psychologically you feel richer when you drive a paid for car. Will that advantage of positive thinking lead to higher earnings? Its possible. The old testament book of proverbs gives many sound words of advice. And you probably know this but it says: \"\"...the borrower is slave to the lender\"\". In my own experience, I feel there is a transformation that is beyond physical to being debt free.\"", "title": "" }, { "docid": "4d10afb74a50006ce9098f1051561fee", "text": "An auto title loans are typically utilized by those that wish to obtain a funding with bad credit rating or no credit in any way. An auto-mobile title lending frequently called a vehicle title lending or merely title funding as well as pink slip funding’s. You merely should have a vehicle that is paid off or nearly paid off and also you could make use of the auto title as security to obtain the cash money you require, enabling you to continue driving your vehicle while paying your loan. Get Auto Car Title Loans Desert Hot Springs CA and nearby cities Provide Car Title Loans, Auto Title Loans, Mobile Home Title Loans, RV/Motor Home Title Loans, Big Rigs Truck Title Loans, Motor Cycle Title Loans, Online Title Loans Near me, Bad Credit Loans, Personal Loans, Quick cash Loans Contact Us: Get Auto Car Title Loans Desert Hot Springs CA 14080 Palm Dr. Ste D # 227, Desert Hot Springs, CA 92240 760-993-3301 caratlloan4u0981@gmail.com http://getautotitleloans.com/car-and-auto-title-loans-desert-hot-springs-ca/", "title": "" }, { "docid": "c4bcf33a97cb8a616ed24cfdb17bee27", "text": "An auto title loans are typically utilized by those that wish to obtain a funding with bad credit rating or no credit in any way. An auto-mobile title lending frequently called a vehicle title lending or merely title funding as well as pink slip funding’s. You merely should have a vehicle that is paid off or nearly paid off and also you could make use of the auto title as security to obtain the cash money you require, enabling you to continue driving your vehicle while paying your loan. Get Auto Car Title Loans Chino CA and nearby cities Provide Car Title Loans, Auto Title Loans, Mobile Home Title Loans, RV/Motor Home Title Loans, Big Rigs Truck Title Loans, Motor Cycle Title Loans, Online Title Loans Near me, Bad Credit Loans, Personal Loans, Quick cash Loans Contact Us: Get Auto Car Title Loans Chino CA 12403 Central Ave # 274, Chino, CA 91710 909-325-3099 chinogatl@gmail.com http://getautotitleloans.com/car-and-auto-title-loans-chino-ca/", "title": "" } ]	fiqa
b080e231f238ff5c5362ac69215b8d7d	Put a dollar value on pensions?	[ { "docid": "e77c72351e5dd78b17a8fbf7908fd325", "text": "@JoeTaxpayer's answer outlines how to value it. Some other considerations: As I understand it, some public pensions may be tax-free if you still live in the state that is paying the pension. E.g. when a Massachusetts teacher receives pension, it is exempt from state taxes, but if that person moves to Vermont he will have to pay Vermont income tax on those payments. So if you plan to stay in the state post-retirement, this provides additional value. Pension payments aren't fully guaranteed by the PBGC. And not all pension plans are fully funded. Depending on the political and economic environment when you hit retirement, your retirement plan could suffer. (And if you aren't working, you may not have a union vote any more when the other working members are voting on contract amendments that affect pensions.) I'm not certain of all of the rules, but I hear news reports from time to time that formulas like what you've posted in the original question are changed through negotiation with the union. If you make an employment decision using the formula in year X and then the formula changes in year X+10, your expected pension payment will change.", "title": "" }, { "docid": "e2ba309b56aba63ae39e216124e6c113", "text": "There are two steps. First you take the age at retirement and annual benefit. Say it's $10,000/yr. You can easily look up the present value of a $10k/yr annuity starting at age X. (I used age 62, male, at Immediate Annuity. It calculates to be $147K. You then need to look at your current age and with a finance calculator calculate the annual deposits required to get to $147K by that age. What I can't tell you is what value to use as a cost of money until retiring. 4%? 6%? That's the larger unknown.", "title": "" } ]	[ { "docid": "19aa9c19267c1a995f6a6466b63680aa", "text": "Dollar cost averaging can be done in a retirement plan, and can be done for individual stock purchases, as this will increase your returns by reducing your risk, especially if you are buying a particular stock for the first time. How many time have I purchased a stock, bottom fishing, thinking I was buying at the low, only to find out there was a new low. Sitting with a thousand shares that are now down $3-$4K. I have a choice to sell at a loss, hold what I've got or double down. I usually add more shares if I'm thinking I'll recover, but at that time I'd wished I'd eased into my investment. That way I would have owned more shares at a smaller cost basis. Anything can happen in the market, not knowing whether the price will increase or decrease. In the example above a $3,000 loss is equal to the brokerage cost of about 300 trades, so trading cost should not be a factor. Now I'm not saying to slowly get into the market and miss the bull, like we're having today with Trump, but get into individual stocks slowly, being fully invested in the market. Also DCA means you do not buy equal number of shares per period, say monthly, but that you buy with the same amount of money a different number of shares, reducing your total costs. Let's say you spend $2000 on a stock trading at $10 (200 shares), if the stock rose to $20 you would spend $2000 and buy 100 shares, and if the stock dropped to $5 you would spend $2000 and buy 400 shares, by now having amassed 700 shares for $6,000. On the other hand and in contrast to DCA had you purchased 200 shares for $2000 at $10/share, then 200 shares for $4000 at $20/share, and finally 200 more shares for $1000 at $5/share, you would have amassed only 600 shares for $7000 investment.", "title": "" }, { "docid": "364ef9c8cb65d47d63f4f94816cb29d7", "text": "There are a number of scholarly articles on the subject including a number at the end of the Vanguard article you reference. However, unfortunately like much of financial research you can't look at the articles without paying quite a bit. It is not easy to make a generic comparison between lump-sum and dollar cost averaging because there are many ways to do dollar cost averaging. How long do you average over? Do you evenly average or exponentially put the money to work? The easiest way to think about this problem though is does the extra compounding from investing more of the money immediately outweigh the chance that you may have invested all the money when the market is overvalued. Since the market is usually near the correct value investing in lump sum will usually win out as the Vanguard article suggests. As a side note, while using DCA on a large one time sum of money is generally not optimal, if you have a consistent salary DCA by frequently investing a portion of your salary has been frequently shown to be a very good idea of long periods over saving up a bunch of money and investing it all at once. In this case you get the compounding advantage of investing early and you avoid investing a large chunk of money when the market is overvalued.", "title": "" }, { "docid": "1cc1cbf238b28b58a628df8b2952238f", "text": "he general advice I get is that the younger you are the more higher risk investments you should include in your portfolio. I will be frank. This is a rule of thumb given out by many lay people and low-level financial advisors, but not by true experts in finance. It is little more than an old wive's tale and does not come from solid theory nor empirical work. Finance theory says the following: the riskiness of your portfolio should (inversely) correspond to your risk aversion. Period. It says nothing about your age. Some people become more risk-averse as they get older, but not everyone. In fact, for many people it probably makes sense to increase the riskiness of their portfolio as they age because the uncertainty about both wealth (social security, the value of your house, the value of your human capital) and costs (how many kids you will have, the rate of inflation, where you will live) go down as you age so your overall level of risk falls over time without a corresponding mechanical increase in risk aversion. In fact, if you start from the assumption that people's aversion is to not having enough money at retirement, you get the result that people should invest in relatively safe securities until the probability of not having enough to cover their minimum needs gets small, then they invest in highly risky securities with any money above this threshold. This latter result sounds reasonable in your case. At this point it appears unlikely that you will be unable to meet your minimum needs--I'm assuming here that you are able to appreciate the warnings about underfunded pensions in other answers and still feel comfortable. With any money above and beyond what you consider to be prudent preparation for retirement, you should hold a risky (but still fully diversified) portfolio. Don't reduce the risk of that portion of your portfolio as you age unless you find your personal risk aversion increasing.", "title": "" }, { "docid": "189074bc66e38dfa800eb176139e72b2", "text": "\"I've been down the consolidation route too (of a handful of DC pensions; the DB ones I've not touched, and you would indeed need advice to move those around). What you should be comparing against is: what's the cheapest possible thing you could be doing? Monevators' online platform list will give you an idea of SIPP costs (if your pot is big enough and you're a buy-and-hold person, ATS' flat-fee model means costs can become arbitrarily close to zero percent), and if you're happy to be invested in something like Vanguard Lifestrategy, Target Retirement or vanilla index trackers then charges on those will be something like 0.1%-0.4%. Savings of 0.5-1.0% per year add up over pension saving timescales, but only you can decide whether whatever extra the adviser is offering vs. a more DIY approach is worth it for you. Are you absolutely sure that 0.75% pa fee isn't on top of whatever charges are built into the funds he'll invest you in? For the £1000 fee, advisers claim to have high costs per customer because of \"\"regulatory burdens\"\"; this is why there's talk of an \"\"advice gap\"\" these days: if you only have a small sum to invest, the fixed costs of advice become intolerable. IMHO, nutmeg are still quite expensive for what they offer too (although still probably cheaper than any \"\"advised\"\" route).\"", "title": "" }, { "docid": "e579c480f632018d2e79008cd1ccaa4b", "text": "Line one shows your 1M, a return with a given rate, and year end withdrawal starting at 25,000. So Line 2 starts with that balance, applies the rate again, and shows the higher withdrawal, by 3%/yr. In Column one, I show the cumulative effect of the 3% inflation, and the last number in this column is the final balance (903K) but divided by the cumulative inflation. To summarize - if you simply get the return of inflation, and start by spending just that amount, you'll find that after 20 years, you have half your real value. The 1.029 is a trial and error method, as I don't know how a finance calculator would handle such a payment flow. I can load the sheet somewhere if you'd like. Note: This is not exactly what the OP was looking for. If the concept is useful, I'll let it stand. If not, downvotes are welcome and I'll delete.", "title": "" }, { "docid": "1a5261fd35e60a67b52827496240db6b", "text": "\"Like Jeremy T said above, silver is a value store and is to be used as a hedge against sovereign currency revaluations. Since every single currency in the world right now is a free-floating fiat currency, you need silver (or some other firm, easily store-able, protect-able, transportable asset class; e.g. gold, platinum, ... whatever...) in order to protect yourself against government currency devaluations, since the metal will hold its value regardless of the valuation of the currency which you are denominating it in (Euro, in your case). Since the ECB has been hesitant to \"\"print\"\" large amounts of currency (which causes other problems unrelated to precious metals), the necessity of hedging against a plummeting currency exchange rate is less important and should accordingly take a lower percentage in your diversification strategy. However, if you were in.. say... Argentina, for example, you would want to have a much larger percentage of your assets in precious metals. The EU has a lot of issues, and depreciation of hard assets courtesy of a lack of fluid currency/capital (and overspending on a lot of EU governments' parts in the past), in my opinion, lessens the preservative value of holding precious metals. You want to diversify more heavily into precious metals just prior to government sovereign currency devaluations, whether by \"\"printing\"\" (by the ECB in your case) or by hot capital flows into/out of your country. Since Eurozone is not an emerging market, and the current trend seems to be capital flowing back into the developed economies, I think that diversifying away from silver (at least in overall % of your portfolio) is the order of the day. That said, do I have silver/gold in my retirement portfolio? Absolutely. Is it a huge percentage of my portfolio? Not right now. However, if the U.S. government fails to resolve the next budget crisis and forces the Federal Reserve to \"\"print\"\" money to creatively fund their expenses, then I will be trading out of soft assets classes and into precious metals in order to preserve the \"\"real value\"\" of my portfolio in the face of a depreciating USD. As for what to diversify into? Like the folks above say: ETFs(NOT precious metal ETFs and read all of the fine print, since a number of ETFs cheat), Indexes, Dividend-paying stocks (a favorite of mine, assuming they maintain the dividend), or bonds (after they raise the interest rates). Once you have your diversification percentages decided, then you just adjust that based on macro-economic trends, in order to avoid pitfalls. If you want to know more, look through: http://www.mauldineconomics.com/ < Austrian-type economist/investor http://pragcap.com/ < Neo-Keynsian economist/investor with huge focus on fiat currency effects\"", "title": "" }, { "docid": "d90d0c190348a1293aef06588932c858", "text": "No. Disclaimer - As a US educated fellow, I needed to search a bit. I found an article 7 Common SMSF Pension Errors. It implied that there are minimum payments required each year as with our US retirement accounts. These minimums are unrelated to the assets within the account, just based on the total value. The way I read that, there would be a point where you'd have to sell a property or partial interest to be sure you have the cash to distribute each year. I also learned that unlike US rules, which permit a distribution of stock as part of a required minimum distribution, in Australia, the distribution must be in cash (or a deposited check, of course.)", "title": "" }, { "docid": "b3ccba376cef3f12a8bad4fc3558abc8", "text": "This may sound a little crazy but I would take $5K of that money and buy whiskey with it (Jack Daniel's would be my preference). My guess is that in 5 years that whiskey will be worth more than the $10K you put in the bank. I just can't see how the dollar survives the next 5 years without a major downward adjustment. If I'm wrong then you have a nice party and give whiskey for Christmas gifts. If I'm right at least you will have some savings instead of $15K of useless dollars. Here is my justification for converting your US dollars into tangible assets. Do you really think the money printing will ever stop?", "title": "" }, { "docid": "028df917647481b5d4e19cbb323afd32", "text": "\"I would want a clause that says you can't endanger my portfolio, but that would never happen I guess. I've just started what I hope to be a long and successful career and I'm considering opting out of the company pension and managing it myself. Some economics people want to make this an \"\"every man for himself\"\" situation. Right now I pay $400 per month into a pension, and at any point it may not exist. I don't think I'm alone in the idea that I can manage my own portfolio at least as well as that, and my own pension will stay with me no matter what, no matter how many companies I work for.\"", "title": "" }, { "docid": "5b1421ff7cbe19205c82ece4c8d8d6c7", "text": "The straight math might favor leaving it, but I'd personally prefer to have it in my control in an IRA. My own employer offered a buyout on the pension program, and the choice between a nice lump sum vs some fixed number 20 years hence was a simple one for me. Both my wife and I (same company) took the lump sum, and never regretted it.", "title": "" }, { "docid": "03bdcd1b1605b952c67b41e225da099a", "text": "\"The end result is basically the same, it's just a choice of whether you want to base the final amount you receive on your salary, or on the stock market. You pay in a set proportion of your salary, and receive a set proportion of your salary in return. The pension (both contributions and benefit) are based on your career earnings. You get x% of your salary every year from retirement until death. These are just a private investment, basically: you pay a set amount in, and whatever is there is what you get at the end. Normally you would buy an annuity with the final sum, which pays you a set amount per year from retirement until death, as with the above. The amount you receive depends on how much you pay in, and the performance of the investment. If the stock market does well, you'll get more. If it does badly, you could actually end up with less. In general (in as much as anything relating to the stock market and investment can be generalised), a Defined Benefit plan is usually considered better for \"\"security\"\" - or at least, public sector ones, and a majority of people in my experience would prefer one, but it entirely depends on your personal attitude to risk. I'm on a defined benefit plan and like the fact that I basically get a benefit based on a proportion of my salary and that the amount is guaranteed, no matter what happens to the stock market in the meantime. I pay in 9% of my salary get 2% of my salary as pension, for each year I pay into the pension: no questions, no if's or buts, no performance indicators. Others prefer a defined contribution scheme because they know that it is based on the amount they pay in, not the amount they earn (although to an extent it is still based on earnings, as that's what defines how much you pay in), and because it has the potential to grow significantly based on the stock market. Unfortunately, nobody can give you a \"\"which is best\"\" answer - if I knew how pension funds were going to perform over the next 10-50 years, I wouldn't be on StackExchange, I'd be out there making a (rather large) fortune on the stock market.\"", "title": "" }, { "docid": "634312a11375ed10181224df31580810", "text": "\"I'm assuming that all the savings are of 'defined contribution' type, and not 'defined benefit' as per marktristan's comment to the original question. Aside from convenience of having all the pension money in one place, which may or may not be something you care about, there may be a benefit associated with being able to rebalance your portfolio when you need do. Say you invest your pension pot in a 60%/40% of equities and bonds respectively. Due higher risk/reward ratio of the equities part, in the long run equities tend to get 'overweight' turning your mix into 70%/30% or even 80%/20%, therefore raising your overall exposure to equities. General practice is to rebalance your portfolio every now and then, in this case, by selling some equities and buying more bonds (\"\"sell high, buy low\"\"). Now if you have few small pockets of pension money, it makes it harder to keep track of the overall asset allocation and actually do the rebalancing as you cannot see and trade everything from one place.\"", "title": "" }, { "docid": "a86ac339b5503e4547a79a0d3386e8dc", "text": "There are also currency hedged ETFs. These operate similarly to what gengren mentioned. For example, a currency hedged Japan equities ETF has an inherent short yen/usd position on it in addition to the equity position, so the effects of a falling yen are negated. Note that it will still be denominated in dollars, however. AED is pegged to the dollar though, isnt it? If your broker is charging you a crazy price maybe try again a different day, or get a new broker. http://www.ishares.com/us/strategies/hedge-currency-impact", "title": "" }, { "docid": "a8136e0b36283542987257724559274e", "text": "\"The standard interpretation of \"\"can I afford to retire\"\" is \"\"can I live on just the income from my savings, never touching the principal.\"\" To estimate that, you need to make reasonable guesses about the return you expect, the rate of inflation, your real costs -- remember to allow for medical emergencies, major house repairs, and the like when determining you average needs, not to mention taxes if this isn't all tax-sheltered! -- and then build in a safety factor. You said liquid assets, and that's correct; you don't want to be forced into a reverse mortgage by anything short of a disaster. An old rule of thumb was that -- properly invested -- you could expect about 4% real return after subtracting inflation. That may or may not still be correct, but it makes an easy starting point. If we take your number of $50k/year (today's dollars) and assume you've included all the tax and contingency amounts, that means your nest egg needs to be 50k/.04, or $1,250,000. (I'm figuring I need at least $1.8M liquid assets to retire.) The $1.5M you gave would, under this set of assumptions, allow drawing up to $60k/year, which gives you some hope that your holdings would mot just maintain themselves but grow, giving you additional buffer against emergencies later. Having said that: some folks have suggested that, given what the market is currently doing, it might be wiser to assume smaller average returns. Or you may make different assumptions about inflation, or want a larger emergency buffer. That's all judgement calls, based on your best guesses about the economy in general and your investments in particular. A good financial advisor (not a broker) will have access to better tools for exploring this, using techniques like monte-carlo simulation to try to estimate both best and worst cases, and can thus give you a somewhat more reliable answer than this rule-of-thumb approach. But that's still probabilities, not promises. Another way to test it: Find out how much an insurance company would want as the price of an open-ended inflation-adjusted $50k-a-year annuity. Making these estimates is their business; if they can't make a good guess, nobody can. Admittedly they're also factoring the odds of your dying early into the mix, but on the other hand they're also planning on making a profit from the deal, so their number might be a reasonable one for \"\"self-insuring\"\" too. Or might not. Or you might decide that it's worth buying an annuity for part or all of this, paying them to absorb the risk. In the end, \"\"ya pays yer money and takes yer cherce.\"\"\"", "title": "" }, { "docid": "d4204f26bc88bab658ce2be226976e79", "text": "\"Since I, personally, agree with the investment thesis of Peter Schiff, I would take that sum and put it with him in a managed account, and leave it there. I'm not sure how to find a firm that you like the investment strategy of. I think that it's too complicated to do as a side thing. Someone needs to be spending a lot of time researching various instruments and figuring out what is undervalued or what is exposed to changing market trends or whatever. I basically just want to give my money to someone and say \"\"I agree with your investment philosophy, let me pay you to manage my money, too.\"\" No one knows who is right, of course. I think Schiff is right, so that's where I would put the amount of money you're talking about. If you disagree with his investment philosophy, this doesn't really make any sense to do. For that amount of money, though, I think firms would be willing to sit down with you and sell you their services. You could ask them how they would diversify this money given the goals that you have for it, and pick one that you agree with the most.\"", "title": "" } ]	fiqa
7745767e455ec8bc690a30e31d38e3e1	Should I use a bank or a credit union for my savings account?	[ { "docid": "96f9b0800ca50be7a63057563f753f60", "text": "\"Your instructor's numbers do not seem to have any basis in current reality. At this page you can see a comparison of interest rates offered by banks and credit unions. In the most recent table for June 2014, banks paid an average interest rate of 0.12 percent on savings accounts, while credit unions paid an average of 0.13 percent. If you look back further, you will see that interest rates paid by banks and credit unions are generally comparable. Credit union rates tend to be a little bit higher, but certainly not 7 times higher. The last time any financial institution paid as much as 15% on a savings account would probably be the early 1980s. You can see here a historical chart of the \"\"prime rate\"\" for lending. Savings account rates (at either banks or credit unions) would typically be lower. (This is based on the US, in accordance with your tag. Interest rates in other places, especially developing countries with less stable currencies, can be dramatically different.)\"", "title": "" }, { "docid": "3d0fe3e6e7002ef41d8402ddc82e230d", "text": "\"In practical terms, these days, a credit union IS a small \"\"savings and loan\"\" bank -- the kind of bank that used to exist before bankers started making money on everything but writing loans. They aren't always going to offer higher interest and/or cheaper loans than the bank-banks, but they're almost always going to be more pleasant to deal with since they consider the depositors and borrowers their stockholders, not just customers. There are minor legal differences (different insurance fund, for example), and you aren't necessarily eligible to open an account at a randomly-chosen credit union (depending on how they've defined the community they're serving), but they will rarely affect you as an account holder. The main downside of credit unions is that, like other small local banks, they will only have a few branches, usually within a limited geographic area. However, I've been using a credit union 200 miles away (and across two state lines on that route, one if I take a large detour) for decades now, and I've found that between bank-by-mail, bank-by-internet, ATM machines, and the \"\"branch exchange\"\" program (which lets you use branches of participating credit unions as if they were branches of your own) I really haven't felt a need to get to the branch. I did find that, due to network limitations of $50K/CU/day, drawing $200,000 worth of bank checks on a single day (when I purchased the house) required running around to four separate branch-exchange credit unions. But that's a weird situation where I was having trouble beating the actual numbers out of the real estate agents until a few days before the sale. And they may have relaxed those limitations since... though if I had to do it again, I'd consider taking a scenic drive to hit an actual branch of my own credit union. If you have the opportunity to join a credit union, I recommend doing so. Even if you don't wind up using it for your \"\"main\"\" accounts, they're likely to be people you want to talk to when you're shopping for a loan.\"", "title": "" } ]	[ { "docid": "12a583a6286a5fc174996a44ac2cf3da", "text": "What worked out well for me is a Capital One High Yield Savings Account, which came with a lower interest rate than most online accounts but higher than a brick & mortar bank. Also, since Capital One has Banking locations now, I can use the ATM card that came with this account to pull out the emergency money if I need it in a pinch at a place that doesn't accept checks.", "title": "" }, { "docid": "cfb1d579fa57cc2707585d49c1d08d17", "text": "The Livret A is a very specific product. It's tax-exempt and would historically not be available through regular banks. Commercial banks can now offer it but they only collect the money on behalf of the Caisse des dépôts (CDC). The CDC then pays interest to the savers and a commission for the bank. The commission is baked into the system, not charged to the customer directly but since the interest rate is set centrally, banks cannot compete on that. So this is risk-free money for them (but on the flip side it does not help them meet capital adequacy requirements). Other savings account or products have different rules. Another angle to consider is that a livret A was historically very attractive for consumers (and was certainly perceived as such) so that many people would have a checking account at a regular bank and another account at the Caisse d'épargne or the Banque postale just to open a livret A. For commercial banks, the alternative therefore isn't having your money on your checking account vs. your livret A or another savings account, it was having your money on a livret A they administer vs. seeing you run away to another institution. There is also a cap on the livret A and you're not allowed to save more money by opening several of them at different banks. At the same time banks have been complaining that the decrease of the interest rate (and consequently of their commission) makes the whole scheme a lot less interesting for them. For what it's worth, I recently (re)opened a bank account in France after living abroad for a long time and the customer advisor did not seem particularly interested in pushing a livret A.", "title": "" }, { "docid": "834161fd81c5a093c0ceb941342f316b", "text": "\"Current is another word for Checking, as it is called in the US. Savings account is an interest-bearing account with certain limitations. For example, in the US you cannot withdraw money from it more than 6 times a month. Here is the explanation why. Current account is a \"\"general-use\"\" account on which you can write checks, use ATM/Debit cards and have unlimited transactions. It can also have negative balance (if your bank agrees to let you overdraft, they usually charge huge fees for that though). Checking accounts can have interest as well, but they usually don't, and if they do - it's much lower than the savings account interest.\"", "title": "" }, { "docid": "d64dbef0a1cadc5d0675d5803684d32c", "text": "Keep your account with Navy Federal, once you get an account at a good credit union keep it. Look for a credit union the students can join, it may be based in the town where the campus is, or one related to the school. Look for a free ATM on campus. Many times it is near the food court or student union or bookstore. If there is none ask the university to get one. If you don't find a local credit union you should be able to deposit the checks via scanner or phone to navy federal.", "title": "" }, { "docid": "ded88302704edac9ccacb87a3e81e195", "text": "Personally, I keep two regular checking accounts at different banks. One gets a direct deposit totaling the sum of my regular monthly bills and a prorated provision for longer term regular bills like semi-annual car insurance premiums. I leave a buffer in the account to account for the odd expensive electrical bill or rate increase or whatever. One gets a direct deposit of the rest which I then allocate to savings and spending. It makes sense to me to separate off regular planned expenses (rent/mortgage, utility bills, insurance premiums) from spending money because it lets me put the basics of my life on autopilot. An added benefit is I have a failover checking account in the event something happens to one of them. I don't keep significant amounts of money in either account and don't give transfer access to the savings accounts that store the bulk of my money. I wear a tinfoil hat when it comes to automatic bank transfers and account access... It doesn't make sense to me to keep deposits separate from spending, it makes less sense to me to spend off of a savings account.", "title": "" }, { "docid": "b9c328db87063e8f3f20f3dd7ee177c4", "text": "Credit unions operate for the benefit of their depositors, who are the actual owners of the institution, whereas conventional banks operate for the benefit of their shareholders, who of course are not necessarily depositors. So credit unions will typically give a benefit or service for free if it is free or extremely cheap to them, whereas conventional banks will charge for it if they think it will not lose them depositors.", "title": "" }, { "docid": "8c07c658d5553d7644b29dcaf5057f39", "text": "\"Here are some things you want to look at for evaluating a bank or credit union for your regular spending accounts: Convenience. Do they have a branch in a convenient location for you? Do they have no-fee ATMs near you? Website. If you are like me, you will spend more time on the bank's website than you do inside a branch. Some bank's websites are great, some are terrible. Unfortunately, this is generally difficult to evaluate until you actually get an account. You want a website that is easy to use. It should allow you to easily move money between your accounts, get instant lists of transactions, show you your monthly statements, and have a billpay feature that works well. If you use budgeting software that interfaces online with your bank, you want to ensure that it works well with your bank. Fee structure. Some banks will nickel-and-dime you to death. Watch out for minimum balance fees and ATM fees. Banks and credit unions usually have a fee schedule page on their website that lists every fee they charge, making it easy to compare different banks. I would not be very concerned about interest rates for savings. Currently, all savings accounts have a universally terrible interest rate. Therefore, I wouldn't base my bank choice on the interest rate. Sure, one might offer double the interest rate of another, but double \"\"next-to-nothing\"\" is still \"\"next-to-nothing.\"\" When you accumulate enough savings that you want to start maximizing your earnings, you can look for a better rate at another bank to move your savings to, and you can keep your checking account at the bank with the best convenience and fee structure. In my limited experience, I have had better luck with credit unions than with banks when it comes to fees.\"", "title": "" }, { "docid": "17ca7c806e458a344150bca1b1c60fa6", "text": "\"There's a lot of personal preference and personal circumstance that goes into these decisions. I think that for a person starting out, what's below is a good system. People with greater needs probably aren't reading this question looking for an answer. How many bank accounts should I have and what kinds, and how much (percentage-wise) of my income should I put into each one? You should probably have one checking account and one savings / money market account. If you're total savings are too low to avoid fees on two accounts, then just the checking account at the beginning. Keep the checking account balance high enough to cover your actual debits plus a little buffer. Put the rest in savings. Multiple bank accounts beyond the basics or using multiple banks can be appropriate for some people in some circumstances. Those people, for the most part, will have a specific reason for needing them and maybe enough experience at that point to know how many and where to get them. (Else they ask specific questions in the context of their situation.) I did see a comment about partners - If you're married / in long-term relationship, you might replicate the above for each side of the marriage / partnership. That's a personal decision between you and your partner that's more about your philosophy in the relationship then about finance specifically. Then from there, how do I portion them out into budgets and savings? I personally don't believe that there is any generic answer for this question. Others may post answers with their own rules of thumb. You need to budget based on a realistic assessment of your own income and necessary costs. Then if you have money some savings. Include a minimal level of entertainment in \"\"necessary costs\"\" because most people cannot work constantly. Beyond that minimal level, additional entertainment comes after necessary costs and basic savings. Savings should be tied to your long term goals in addition to you current constraints. Should I use credit cards for spending to reap benefits? No. Use credit cards for the convenience of them, if you want, but pay the full balance each month and don't overdo it. If you lack discipline on your spending, then you might consider avoiding credit cards completely.\"", "title": "" }, { "docid": "e5063253b5d1a21cb017664c69671eb0", "text": "Credit Unions are structured such that the account holders are in fact the owners of the institution. Thus, the money invested in your savings account is in fact a share of ownership, and the interest paid to you is dividend. Tax-wise, these dividends are usually treated as interest income.", "title": "" }, { "docid": "81fa99448ed54bf9be7ae79aad9e6474", "text": "Why don't people switch banks? It's honestly not that hard. Once I switched to a local credit union, I'll never use a big bank again. The service is amazing and there are pretty much no fees for anything.", "title": "" }, { "docid": "bc871db013821451458935548a97e542", "text": "Besides, if you don't like how your Credit Union is investing your money, you can always agitate for change by asking members to change the board that governs it. Being a member of a Credit Union gives you a vote on how the institution runs itself.", "title": "" }, { "docid": "ca37bdb301183b7b8d71e98500c3119e", "text": "You're asking for opinions here, which is kindof against the rules, but I'll give it a try. 1) Does emergency funds and saving money(eg.Money plan to buy a house) should be in same Saving Account? 2) or should each specific saving plan set up in particular Saving Account? No, it doesn't. It's a matter of convenience. I personally find it more convinient to have different stashes for different purposes, but it means extra overhead of keeping an eye on one more account. Fortunately, with on-line access, mint.com and spreadsheets, it's not that big of an overhead. 3) If saved in same Saving Account, how could I manage easily which percentage is planned for which? Excel spreadsheet comes to mind. Banks may have some tools too, for example Wells Fargo (where I'll be closing my account soon), has a nice on-line goals manager that allows you to keep track of your savings per assigned goals (they allow one goal per savings account, but you can have multiple accounts for multiple goals, and it will show the goals and progress pretty nicely). 4) If not saved in same Saving Account, the interest earned would be smaller because they all clutter across multiple Saving Accounts? In some banks interest rates are tiered. But in most on-line savings accounts they're not, and you get the same high rate from the first $1 deposited. So if in the bank where you keep the money they only pay a decent rate if you deposit some big lump of money - just open an account elsewhere. Places to check: American Express FSB, ING Direct, E*Trade savings, Capital One, Ally, and many more.", "title": "" }, { "docid": "461c152324958ced29ae3830eb5af3d6", "text": "Nope. Credit Unions are for the customers. Since the customers own them, the credit union does what is best for the members. They aren't giving you money, they are loaning it to you for for interest. Furthermore then judged you like any other bank would. High horse moment: I believe the only reason you have to open an account, is because the banking industry didn't want to compete and got legislation to limit the size and reach of a credit union. The credit union wants your business, and they want to work for you, but they are required to have these membership requirements because their lobby isn't as powerful as regular banks.", "title": "" }, { "docid": "06da1a02f4be05b0bd45a099ebcfa5e0", "text": "There is very little difference these days between account types. The fee structure and interest paid is different, but the actual mechanics, and as noted by others, the coverage by deposit insurance is identical. So look at how much money you have in the account(s) you have; are you maximizing the interest that you could be receiving, even from the small amounts that the banks will pay? If you could get more interest from the savings account, and only write one or two cheques per month, you might be better off with that account only; but given common fee structures, you likely would not want that as your primary account. Another reason for separate accounts is more psychological. You might be able to train yourself to not dip in to your savings if you don't have a chequebook.", "title": "" }, { "docid": "592ad3963c42c459197267cc2ced76b4", "text": "I keep several savings accounts. I use an online-only bank that makes it very easy to open a new account in about 2 minutes. I keep the following accounts: Emergency Fund with 2 months of expenses. I pretend this money doesn't even exist. But if something happened that I needed money right away, I can get it. 6 6-month term CDs, with one maturing every month, each with 1 month's worth of expenses. This way, every month, I'll have a CD that matures with the money I would need that month if I lose my job or some other emergency that prevents me from working. You won't make as much interest on the 6-month term, but you'll have cash every month if you need it. Goal-specific accounts: I keep an account that I make a 'car payment' into every month so I'll have a down-payment saved when I'm ready to buy a car, and I'm used to making a payment, so it's not an additional expense if I need a loan. I also keep a vacation account so when it's time to take the family to Disneyland, I know how much I can budget for the trip. General savings: The 'everything else' account. When I just NEED to buy a new LCD TV on Black Friday, that's where I go without touching my emergency funds.", "title": "" } ]	fiqa
c30724451a0531757d30b24919e59f6d	How can we get a hold of our finances again, with much less time to spend on accounting and budgeting, due to the arrival of our child?	[ { "docid": "0b092d60a54e06d10a99ba767a2c8ebf", "text": "I have also tried Mvelopes in the past, and my experiences match yours. I currently use the desktop version of YNAB:You Need a Budget (YNAB 4), and I like it much better. Where we failed after a while with Mvelopes, we are succeeding with YNAB, and have been now for the last 3.5 years. I don't want this to sound like a commercial for YNAB (I will give important caveats about YNAB later), but here is why I believe we have done better now with YNAB than before with Mvelopes. I hope that these reasons will be useful to you when you are evaluating your next options. As you said, we also found Mvelopes' interface to be slow and glitchy. YNAB 4 is a desktop app (with synching capabilities) that we found to be much quicker and easier to work with than Mvelopes' Flash-based interface. (That was 4 years ago; hopefully Mvelopes has redone their interface since then.) We also struggled with Mvelopes' connection with our banks. With YNAB 4, there is no connection to the bank: everything has to be entered manually. I initially thought this might be worse, but for us it has been better. I can either enter transactions as they happen on the mobile app, or I can hold on to receipts and enter them every day or two in the evening, categorizing as I go. We always have an up-to-date picture of our finances, and we don't have to mess with trying to match up downloaded transactions that have been screwed up, duplicated, or are missing. We aren't really using YNAB much differently than we were using Mvelopes, but we have learned a few tricks that I think have contributed to our success. One of the things we do differently is that I don't obsess about the cash accounts too much. Cash accounts, for us, are the hardest to keep track of, because most of our cash transactions don't have a receipt: we are paying a friend or family member for something, or leaving a tip, or something like that which we forget about when it comes time to enter into the software. As a result, the cash account balances get off. I periodically enter a correcting transaction to get the balances right, and have a budget category specifically for this that we have to put money in for these unknown transactions. Fortunately for us, our cash spending is a small percent of our total spending (we usually pay with a credit card) so this bit of untracked spending isn't that big of a concern. With YNAB, the current month's budget is right in front of you as soon as you open up the app, which makes it easy to adjust your budget during the month, if necessary. With Mvelopes (at least how their app worked 4 years ago), the budget was somewhat hidden after you funded your budget categories, and it was a bit of a pain to move money around between categories. The ability to adjust your budget in the middle of the month is crucial; if you don't do that, you'll get frustrated the first time you find that you don't have enough money in a category for something you need. YNAB makes it very easy to move money around inside your budget. That having been said, you need to be aware that the current version of YNAB is not a desktop application but a web-based app. YNAB 4, the old desktop version which we have been using, is officially unsupported as of the end of 2016. However, I see that it is still available for sale, if you are interested in it, the YNAB4 help site is still up, and the mobile app you would need to work with it on your phone (called YNAB Classic) is still in the app store. As I said, the current YNAB is now a web app, complete with automatic downloading of transactions from your bank. I have no experience with it (other than playing around with it a little), and so I can't tell you how quick the interface is or how well the auto-downloading of transactions works. As an alternative, another web-based solution is EveryDollar, from Dave Ramsey's company. (I have never tried it.) The advantage of this one is that it is free if you choose not to link it to your banks; the automatic downloading of transactions is a paid feature. I wrote an answer a couple of years ago in which I describe two different approaches that budgeting software packages tend to take. I'm not familiar with Buxfer, so I don't know which approach it takes, but perhaps that answer will help you evaluate all of your software options. On the behavior side of things, besides the relaxing of the cash accounting I mentioned above, we also involve my wife a little less in the budgeting process than we used to. (This is by her choice!) I am the one who enters all the transactions into the software (she hands me all her receipts), I reconcile the accounts at the end of the month, and I set the budget for the next month. We have been doing this long enough now that she knows what the budget is, and we only need to discuss it if we want to do something different with the budget than we have been doing in the past. She has the YNAB app on her phone and can see where we are at with all of our budget categories.", "title": "" }, { "docid": "abdc0f634367fb8d5f4ae7281c1843c7", "text": "Good question, very well asked! The key here is that you need to find a solution that works for you two without an overt amount of effort. So in a sense it is somewhat behavior driven, but it is also technology driven. My wife and I use spreadsheets for both checking account management and budgeting. A key time saver is that we have a template sheet that gets copied and pasted, then modified for the current month. Typically 90% of the stuff is the same and each month requires very little modification. This is one of my problems with EveryDollar. I have to enter everything each and every month. We also have separate checking accounts and responsibility for different areas of the family expenses. Doing this risks that we act as roommates, but we both clearly understand the money in one persons account equally belongs to the other and during hard times had to make up for shortfalls on the part of the other. Also we use cash for groceries, eating out, and other day to day expenses. So we don't have a great need to track expenses or enter transactions. That is what works for us, and it takes us very little time to manage our money. The budget meeting normally lasts less than a half hour and that includes goal tracking. We kind of live by the 80/20 principle. We don't see a value in tracking where every dime went. We see more value in setting and meeting larger financial goals like contributing X amount to retirement and things of that nature. If we overspent a bit at Walgreens who cares provided the larger goals are meant and we do not incur debt.", "title": "" } ]	[ { "docid": "b941ec8a64dd8a7efd3690dab33cd768", "text": "Try the following apps/services: Receipt Bank (paid service, gathers paper receipts, scans them and processes the data), I've tested it, and it recognizing receipts very well, taking picture is very quick and easy, then you can upload the expenses into your accounting software by a click or automatically (e.g. FreeAgent), however the service it's a bit expensive. They've apps for Android and iPhone. Expentory (app and cloud-based service for capturing expense receipts on the move),", "title": "" }, { "docid": "945eb54a9e010bb03eece1f39c9d3254", "text": "Happened with my family. My wife could not work for an extended period after birth of our first child. At the same time I was injured and due to the injury the doctor would not release me to return to the same position so I was let go. It was a good paying job at the time. To top it all off if we both picked up minimum wage jobs working we lost all food benefits and could pay our bills but not afford food. We also had to work around each others and our parents schedules so we had someone to watch our baby. If we were paying 100+ a week for childcare while working we would have been starved.", "title": "" }, { "docid": "81b2ae9f0162027b20065683189591a2", "text": "Option three is our preferred method, and we never argue about money. First we did a budget to work out ALL monthly joint out-goings (mortgage, bills, grocery etc). Then we each agreed who would pay what into the joint or household account - at the moment, I earn more than my wife, so I pay more, but we sit down every three or four months, to see if it needs adjusting. This way, we each keep our own individual accounts private, but pay what is necessary into the household account. We also set up a joint savings account; often at the end of the month, we'll have a little extra left in the household acount, and we siphon that off into joint savings to cover future unexpected costs - looks like our tumble dryer is on its last spin cycle at the moment, for example, and the joint savings account will be able to cover the cost of replacement. it all takes a bit of administration - but, as I say, we've never had a cross word about money, so the system seems to work.", "title": "" }, { "docid": "533849b422ef3b33e57bd133c162eba5", "text": "\"With regard to worries about ownership: I'll point you towards this - The Cohabitants Rights Bill currently in First Reading at the House of Lords. Without a date for even the second reading yet. In short the Bill is attempting to redress is the lack of rights when a non-married relationship ends when compared to married relationships; that is that one of the \"\"cohabitants\"\" can end up with basically nothing that they don't have their name on. So currently you're in the clear and (Part 2) Section 6.2.a says the Bill cannot be used retroactively against you if your relationship is over before it becomes law (I expect with Brexit etc, this Bill isn't a high priority - it's been a year since the first reading). Section 6.2.a: This Part does not apply to former cohabitants where the former cohabitants have ceased living together as a couple before the commencement date; However, if you're still together if/when this Bill becomes Law then basically all of (Part 1) Section 2 may be relevant as it notes the conditions you will fall into this bill: Section 2.1.a: live together as a couple and Section 2.2.d: have lived together as a couple for a continuous period of three years or more. and the \"\"have lived together\"\" at that point counts from the start of your cohabitation, not the start of the Bill being law: Section 2.4.a: For the purposes of subsection (2)(d), in determining the length of the continuous period during which two people have lived together as a couple - any period of the relationship that fell before the commencement date (of the Bill) is to be taken into account If you have kids at some point, you'd also fall under 2.2.a through 2.2.c too. After that, the financial parity decided upon by the court depends on a whole bunch of conditions as outlined in the Bill, but Section 8.1.b is pretty clear: Section 8.1.b: (b)the court is satisfied either— (i)that the respondent has retained a benefit; or (ii)40that the applicant has an economic disadvantage, as a result of qualifying contributions the applicant has made I'm not qualified to say whether your partner helping to pay off your mortgage in lieu of paying rent herself would count as just paying rent or giving you an economic benefit. Sections 12, 13, and 14 discuss opt-outs, also worth a read. The a major disclaimer here in that Bills at this early stage have the potential to be modified, scrapped and/or replaced making this info incorrect. As an additional read, here's an FT article from Feb 2016 discussing this lack of rights of a cohabitant which should alleviate any current concerns.\"", "title": "" }, { "docid": "cf9acce31255e5069836e3e03d19397a", "text": "\"I hear you (and those answering) use the words \"\"my money\"\" (or \"\"me to pay for stuff\"\") The sooner that ends, the better off you'll both be. My wife and I do have our own checking accounts that we maintain so she can write a check without notifying me, or I can buy her a birthday/mother's day/ etc gift without it showing in the joint account, but nearly all money flows through our joint account. Before we were married, the joint bank accounts were opened as was the joint brokerage account. You need to work on the budget as a single project and without judging. It's good that your incomes are similar, it makes the dynamics of pooling seem more fair, but for those where one spouse is making far more than the other, the impulse to 'chip in' equally towards bills leaves the lower earner with nothing. Will your wife go back to work after a maternity leave? Once she's back, and working for a time, things will settle down a bit. There's a postpartum time that's difficult. Women who have been through it will tell you that it can be pretty bad, and the best a guy can do is be understanding and supportive. As long as you are talking \"\"we\"\" with your wife, she'll see that you are both in it together. At the risk of sounding sexist, Women's clothing needs are different than men's. I could get away with owning 5 suits which could be replaced at the rate of one per year. If not for my wife, I can see in my own daughter how clothing makes her feel good about herself, and while I'm frugal with most of our budget, my clothing questions are 2 - Will it last? & Will it match other pieces you have? Therefore, clothing gets a line item all its own in the budget. There are a number of financial things to consider, but I see you are in the UK, so I'll generalize. In the States, there are pretax benefits to help care for a child under 13 (called a dependent care account) and for medical expenses not covered by insurance (called flexible spending account). These let you take money from your pay pretax to use for specific expenses. If UK offers similar, I invite a user to edit the detail into my answer. Last - once the kid comes into our lives, there's little room for many of the late teen/early 20's spending. Comics? DVDs? Those are the low hanging fruit of wasted money. Saving for retirement, and for University for the kid take priority. I'm not one to quote cliches but a friend once offered this observation - \"\"If you are not happy but your wife is happy, you are still far happier than if you were happy but your wife is not happy.\"\"\"", "title": "" }, { "docid": "3f92a79f53d8f78839f6fc06c3529306", "text": "I think this varies considerably depending on your situation. I've heard people say 6 month's living expenses, and I know Suze Orman recommended bumping that to 8 months in our current economy. My husband and I have no children, lots of student loan debts, but we pay off our credit cards in full each month and are working to save up for a house. We've talked through a few different what-if scenarios. If one of us were to lose our job, we have savings to cover the difference between our reduced income and paying the bills for 6 or 8 months while the other person regained employment. If both of us were to lose our jobs simultaneously, our savings wouldn't hold us over for more than 3 or 4 months, but if that were to happen, we would likely take advantage of the opportunity to relocate closer to our families, and possibly even move in to my parent's house for a short time. With no children and no mortgage, our commitments are few, so I don't feel the need to have a very large emergency cash fund, especially with student loans to pay off. Think through a few scenarios for your life and see what you would need. Take into consideration expenses to break a rental lease, cell phone contract, or other commitments. Then, start saving toward your goal. Also see answers to a similar question here.", "title": "" }, { "docid": "7db0e1024a877eef3d9eb956ae5e7118", "text": "Not in the long term, of course not. But take a cross-country flight in coach, after the normal check-in process at your destination, stress over a lost bag or two, and then with no turnaround time deliver an address, run a meeting, or work with sensitive materials. As others have pointed out, an hour or two of coach isn't going to dramatically impact one's ability to do that although the flight could very well leave a sour taste in one's mouth if you had a baby screaming through most of it or some other adversity that could have been avoided if you flew business/first.", "title": "" }, { "docid": "bf5e9fa941ac38c0cf3dae70a40d1c44", "text": "\"The trick to using a credit card responsibly is accounting. With your old system, you were paying for everything out of your savings account. Everytime you had an expense, it was immediately withdrawn from your savings account, and you saw how much money you had left. Now, with a credit card, there isn't any money being withdrawn from your savings account until a month later, when you have a huge credit card bill. The trick is to treat every credit card transaction as if it was a debit card transaction, and subtract the money from your \"\"available funds\"\" on paper immediately. Then you'll know how much money you actually have to spend (not by looking at your bank statement, but by looking at your \"\"available funds\"\" number), and when the credit card bill comes, you'll have money sitting there waiting to go to the credit card company. This requires more work than you had with your old system, and if it sounds like too much work, you might be better off with a debit card or cash. But if you want to continue to use the credit card, you'll find that the right software will make the accounting process easier. I like YNAB, but there are other software products that work as well. Just make sure that your system accounts for each credit card transaction as it is spent, deducting the amount from your budget now, so that there is money set aside for the credit card bill. Software that simply categorizes your spending after the fact is not as useful.\"", "title": "" }, { "docid": "f3e50dd861f531211ef5db6eeca1998b", "text": "Since this post was migrated from Parenting, my reply was in the context where it appeared to be misrepresenting facts to make a point. I've edited it to be more concise to my main point. In my opinion, the best way to save for your childs future is to get rid of as much of your own debt as possible. Starting today. For the average American, a car is 6-10%. Most people have at least a couple credit cards, ranging from 10-25% (no crap). College loans can be all over the map (5-15%) as can be signature (8-15%) or secured bank loans (4-8%). Try to stop living within your credit and live within your means. Yeah it will suck to not go to movies or shop for cute things at Kohl's, but only today. First, incur no more debt. Then, the easiest way I found to pay things off is to use your tax returns and reduce your cable service (both potentially $Ks per year) to pay off a big debt like a car or student loan. You just gave yourself an immediate raise of whatever your payment is. If you think long term (we're talking about long-term savings for a childs college) there are things you can do to pay off debt and save money without having to take up a 2nd job... but you have to think in terms of years, not months. Is this kind of thing pie in the sky? Yes and no, but it takes a plan and diligence. For example, we have no TV service (internet only service redirected an additional $100/mo to the wifes lone credit card) and we used '12 taxes to pay off the last 4k on the car. We did the same thing on our van last year. It takes willpower to not cheat, but that's only really necessary for the first year-ish... well before that point you'll be used to the Atkins Diet on your wallet and will have no desire to cheat. It doesn't really hurt your quality of life (do you really NEED 5 HBO channels?) and it sets everyone up for success down the line. The moral of the story is that by paying down your debt today, you're taking steps to reduce long haul expenditures. A stable household economy is a tremendous foundation for raising children and can set you up to be more able to deal with the costs of higher ed.", "title": "" }, { "docid": "0efe2844118714ca1c92e0350393e1cb", "text": "You can take a shortcut and make a few cumulative transactions, maybe just estimate how much of your spending landed in each of your budget categories, but you will lose a lot of the value that you were building for yourself by tracking your spending during the earlier months. I reconcile my budget and categorize my spending on a monthly basis. It's always a chore to pull out the big stack of receipts and plow through them, but I've learned the value of having an accurate picture of where all my money went. There is no clean way to fake it. You can either take the time and reconcile your spending, or you can take a short cut. It probably renders your efforts to track everything from the beginning of the year invalid though. If you want to start over this month (as you did at the beginning of the year) that would probably be a cleaner way to reconcile things.", "title": "" }, { "docid": "4e5a9ab91aabd01443c114298a758a79", "text": "There is one way to make money quickly. If you are married and both are over 50 and you can put money into a deductible IRA for 2014. The $5,500 contribution and $1,000 catch-up per person would allow the family to make a contribution of $13,000. If they are in the 25% tax bracket the $3,250 drop in their taxes would allow them to get a $325 bonus from their tax software. Of course they would have already had to be getting a refund before the IRA contribution, or the new refund and bonus would be smaller. They would have had to meet all the program rules. And they must have a combination of 401Ks and AGI to allow deductible contributions. This would drastically shorten the initial loan period.", "title": "" }, { "docid": "6897089a80d17369614fab853c13e7e6", "text": "Did you account for college? That's 40k per year in tuition alone. Also I'm not sure you accounted that the number included income forgone, as in if they weren't taking care of the kids they could've been earning more money. The article says the cost to parents is 900,000 per kid, but that doesn't mean the parents are actually spending 900,000 per kid. Lots of other things to account for...a couple w/o kids doesn't need to get a 4-bedroom house for example. Does your co-worker own a house? Did you account for the cost of ownership?", "title": "" }, { "docid": "5c55561d6243e5c78953a6dc97e7a62a", "text": "We aim to keep 6 months of expenses. The rationale is that its enough time to recover from most serious illnesses (that you can recover from) or a redundancy or pay for a large unexpected problem not covered by the insurance (e.g. the boiler dying). It also gives us enough time to reorganise finances if needed. For example we could get out of contracts (like mobile phones, sky TV), sell the car, and maybe even find a cheaper house if needed in that time. It will take a good chunk of time to build up that amount and it's worth considering how many commitments you have (kids, wife, mortgage, car...) as the fewer you have the less you need. If you have fewer commitments you can be comfortable with much less contingency. When I lived in rented accomodation and didn't run a car or have many possessions, I just maintained enough cash to cover my bills for about 6 weeks, this would give me enough time to find another job, and if I didn't get one I could always crash round a friend's house.", "title": "" }, { "docid": "ecb895c7bb53ff9d68dcb55d71197e94", "text": "\"All of these answers are great but I wanted to add one piece of advice from someone who has been married 8 years and been in various financial \"\"situations.\"\" Have one of you (whoever the two of you feel is more organized and more financially responsible) be solely in charge of paying the monthly bills, but keep a spreadsheet or some other tracking mechanism so that the other can monitor this as well. That way if you guys ever decide to switch roles there won't be much of a learning curve. Also, don't do three bank accounts. One or two is enough, more than that starts becoming more difficult to keep track of and if you have any sort of monthly fees on the accounts it also wastes money. My wife and I each have our own account and we get money for each other if necessary. She handles paying the bills but keeps a monthly spreadsheet that has all pertinent info. We have a number and color coding system to determine which paycheck (1st or 2nd of the month) the bill is paid in and whether it has been paid, not paid, or past due (green, yellow, red). Hopefully you don't ever have to see the red color :P\"", "title": "" }, { "docid": "a6f36feca2812f61fd959f5089dbcb7e", "text": "This is the same as any case where income is variable. How do you deal with the months where expected cash flows are lower than projected? When I got married, my wife was in the habit of allocating money to be spent in the current month from income accrued during the previous month. This is slightly complicated because we account for taxes (and benefit expenses) withheld in the current months' paychecks as current expenses, but we allocate the gross income from that check to the following month for spending. The benefit of spending only money made during the previous month is that income shocks are less shocking. I was working for a start-up and they missed payroll that normally arrived on the first of the month. Most of my co-workers were calling the bank in a panic to avoid over-draft fees with their mortgage payments, but my mortgage payment was already covered. Similarly, when the same start-up had a reduction in force on the first day of a new quarter, I didn't have to pull any money from savings during the 3 weeks I was unemployed. In the end, you're going to have to allocate money to the budget based on the actual income--which is lower than your expectations. What part of the budget should fairly be reduced is a question you and your wife will have to figure out.", "title": "" } ]	fiqa
165ba47188a1562b94377049029718b9	Should I try to negotiate a signing bonus?	[ { "docid": "4bd9fcbbb95150d3b0af2f29e29eb5f2", "text": "You asked about a signing bonus and were told the conditions that would be required to get one. It does not appear that you will qualify, but you do have another option. Ask if you can start earlier. Some times they can't change the start date. They might have a contractual issue with the customer and the customer is setting the start date. Other times they are waiting for somebody else to retire or transfer. But ask. Tell them starting earlier speeds up the training process. For you it can make the transfer of insurance benefits sooner. Keep in mind it could be a few weeks before you get your first pay check. How were you planning on bridging the gap?", "title": "" }, { "docid": "6f47f06623dd8319201aedf3c4769a27", "text": "I was able to request a modest advance on my salary when I started my first job out of college, for essentially the same reason. Alternatively, you might consider requesting a small personal loan from friends or family. If you have a credit card that can cover things like grocery expenses for that period, this may also be the appropriate time to use it. Buy cheap food, like lentils and beans. :P In the future, once you earn some money, you should keep around a few months' worth of essential expenses in a saving account to avoid this situation. :)", "title": "" } ]	[ { "docid": "88ad101812c46ae30dfe93a1ece147d7", "text": "\"It's correct. Be sure of your personal opportunity cost and not that you're letting the tax tail wag the dog just to score \"\"tax free\"\". Your upside is $3,700 (single) or $7,000 (married) in taxes saved until you're out of the 0% zone. Is that worth not receiving an income? Even if your savings are such that you don't need to work for income for a fiscal year, how would this affect the rest of your career and lifetime total earning prospects? Now, maybe: Otherwise, I'd hope you have solid contacts in your network who won't be fazed by a resume gap and be delighted to have a position open for you in 2019 (and won't give you the \"\"mother returning to the workforce\"\" treatment in salary negotiations).\"", "title": "" }, { "docid": "24ce5118de0a6de657638a8502dbeda9", "text": "It appears that co-signing does impact your debt-to-income ratio, at least in the US. An article on Kiplinger says: An article on Forbes agrees saying: There is a similar question here.", "title": "" }, { "docid": "8e2874688db6b0b32fb76c4ef38193fa", "text": "\"Yeah I'm not too sure either, but in response to your edit, this is what got me wondering even more, enough to post this question. Last year was a rough year. Growth was flat in many regions. Still, I heard salesfolks complaining about bonuses. I had the same reaction as you-- \"\"why would you get a bonus?\"\" But then I started thinking perhaps some amount is guaranteed.\"", "title": "" }, { "docid": "ca226fb2b7f8c68bafb0785b16c65a49", "text": "Sorry to call you out on this, but your numbers are definitely off. If someone takes you seriously you'll be misleading them and I'd like to avoid that. Maybe you had this conversation with your friends many years ago when salaries were lower? The big consulting firms all have set base salary and signing bonus for all entry level positions in the US. Everyone in the starting class out of undergrand has the same starting salary (across all geographic regions). Depending on the firm and your performance, you then receive a year end bonus (or no bonus at all). For MBB, you can expect close to a 6 figure salary in your first year. With an MBA, you're closer to $200k with bonus. Source: I work for a top consulting firm, but here are some hard figures: http://managementconsulted.com/consulting-jobs/2012-management-consulting-salaries-undergraduate-post-mba/#", "title": "" }, { "docid": "bce8281f921835b728fba8738e1ec55c", "text": "I had a similar decision to make. I got offered a modest salary near Philly, or a better salary plus a nice bonus in New York. I chose New York. I'm loving it so far but who knows what will happen. I'm actually saving a lot of money as I automatically have it deduct from my paycheck and disperse into several savings accounts. I guess it's different for everyone and you have to consider your situation before applying a blanket advice", "title": "" }, { "docid": "1d00987555a8015423f18b851741a4dd", "text": "There is no reason to try to build a commission discount into the contract when you are not represented by a buyer's agent. Make your offer is 3% lower than it would be otherwise. Then the seller's agent becomes your best ally. He knows he'll get the whole commission, so it's in his best interest to make the deal happen. Even if he believes another unrepresented buyer will come along, the difference in his commission will be minuscule and probably not worth his time. If you get the price you offered, does it matter whose pocket the discount came out of? On the other hand, if you enter negotiations that stall at an amount less than half of the commission, then mention a discounted commission. At that point the deal is so close that the seller and agent may be able to bridge the gap themselves.", "title": "" }, { "docid": "7f5de9d42d6b2e6ce7d2b202ce08467a", "text": "\"So you've already considered relocation. Here are a few additional things to consider with respect to negotiating a signing bonus (if any): Would you be leaving a position where you are eligible for an upcoming bonus, profit-share, or other special incentive payout, such as a stock option or RSU vesting date? A signing bonus can help offset the opportunity cost of leaving a previous job when an incentive payout date is near. At the new company, would you be required to wait some pre-defined period to be eligible to participate in the pension or retirement savings plan with employer basic or matching contributions? If you were receiving ongoing employer contributions in your previous company's plan and would need to wait, say, six months before participating in the new company's plan, a signing bonus can offset lost employer contributions in the interim. Consider funding your own IRA in that time. Would you be required to give up something else of value to you that your previous employer was providing, such as an expensive laptop, that is not expected to otherwise be replaced by the new company? Whether they offer a signing bonus and how much you can expect to negotiate is based on a lot of factors and you'll need to \"\"play it by ear.\"\" Remember what bonus means: \"\"A payment or gift added to what is usual or expected, in particular.\"\" Remember also that a signing bonus is a one time thing. In general, it's more important to consider the overall ongoing compensation package – salary and incentive plans, vacation, retirement benefits, health benefits, etc. – and whether those meet your long-term needs.\"", "title": "" }, { "docid": "5b187e51a67e4252cd8dd1661b597fed", "text": "\"To avoid going on and on in the comments I'm going to add this point that seems to be missing from the other answers. \"\"Banks often offer me deals while negotiating to open an account (since they are under high pressure to open an account)\"\" Would these happen to be the regionally advertised account opening deals like a $200 new checking account bonus if you deposit at least $x and leave it for at least 90 days? This kind of deal is not unique to you. This is not offered to you because of your unique negotiating ability. You need to understand the authority of the person you're dealing with. Products are designed in the corporate arm of the bank. Once a product is ready, it's rolled out to branches to be sold; sometimes with some fancy sign-up bonus. A checking account is a product, just like an iPhone. Apple took the headphone jack out of the iPhone 7, no amount of negotiating with the Genius at the Apple store will put it back for you. Vote with your wallet, show the bank you're unhappy by leaving.\"", "title": "" }, { "docid": "095e3e4d9a24d616d38647e66d9b8f77", "text": "\"Eh, that doesn't really make for healthy negotiations. Consider the converse argument: \"\"a candidate should put their acceptable salary range on their resume.\"\" Every hiring manager is going to offer you your lowest acceptable salary. You might have gotten more money had you not freely offered that information.\"", "title": "" }, { "docid": "9452c0d753736f741583048c7893c6fd", "text": "Keep in mind that unless you have a contract that says you get a certain amount of raise every year, the employer is not required to give you any raise. The quality of a raise is too subjective for anyone to tell you how to judge it. You either get a raise you can live with, it makes you content/happy, and you continue working there, or you get a raise that does not satisfy you, and you jump ship to get more money. Some (most?) employers know that raises can be the tipping point for employees deciding to leave. If you consistently receive raises greater than inflation rate, the message is that the employer values you. If the opposite, they value you enough to continue your employment, but are willing to replace you if you decide to leave. Key thing here is there are three ways of getting increased pay with your current employer. Cost of living or annual raise is the one that we are discussing. Merit based raises are a second way. If you think you deserve a raise, due to loyal consistent contribution, or contributing above your duty, or for whatever reason, then ask for a raise. The third way is to be promoted or transferred to a higher paying position. Often times, you should also make your case to your supervisor why you should have the new position, similar to asking for a merit raise.", "title": "" }, { "docid": "579c8476f10c771de25bb5fcb30209e4", "text": "\"Keep in mind one possible gotcha on depositing a bonus into your 401K: Tax withholding. Depending on whether your employer combines your bonus onto a regular paycheck, you can be bitten if you allocate a large chunk to your 401K. I suspect your bonus is, like most, subject to an arbitrary federal withholding requirement of 25%, and if you allocate 100% of the bonus to your 401K, the 25% withholding may come out of what would ordinarily be the take-home in your \"\"regular\"\" paycheck - leaving you with a literal take-home of zero for one pay period. There are lots of variables in that calculation, obviously, but it's one a lot of people seem to overlook.\"", "title": "" }, { "docid": "8a3d797aa87ef7b3348e3767f7d07be1", "text": "That's my point, a 20k bonus at big 4 for non partners is really common. You can easily get 40-50k if you're highly rated. Also, I'm not saying the max for partners is 600k, that's the average. This is much higher than the average Accenture partner-equivalent. The data is out there, just look at glassdoor. It's perfectly ok to not be big4, you can still make a good living at Accenture. But, realistically, the compensation and other benefits are lower. My theory is because public firms pay less than private firms, what's yours?", "title": "" }, { "docid": "ea751480073d65d4e870329fddcd427f", "text": "\"IANAL, but I had heard (and would appreciate someone more qualified commenting on this) that one reason these things were often found unenforceable is that there is no consideration. The contract is to bind you for your work each day, but once you stop working, they allege you have a continued obligation that transcends your time at the company. Claiming that your day-to-day compensation covers this is as if to say some part of that compensation is not for your work but to pay you for not going elsewhere. It would be nice to see at minimum a requirement to separate these two concepts into separate contracts as bundling them creates a blur, and most importantly doesn't allow you to negotiate or walk away from the terms of one part without the other. At the heart of any \"\"market\"\", which the job market purports to be, is a sense that a fair price is reached when both parties can walk away from a bad deal. This is not so in the case of employment because, as Adlai Stevenson said, \"\"a hungry man is not a free man\"\", so someone who needs to eat (or feed a family) has a need to take an offer that is already biasing their acceptance of work, and this quasi-duress is compounded when a company can attach additional pressures that work agains that person's ability to fairly negotiate possible improvements of what may already have been a bad situation. I'm of the impression that duress itself has been argued to be a reason to hold a contract invalid. But more abstractly and generally, any time two parties are bargaining asymmetrically (I'm not sure the legal definition, but intuitively I'd say where one party has the ability to force a contract change and the other party is not), then those terms have to be suspect. Also, for the special case the pay is anything near minimum wage, I would suggest asking the question of whether the part of the compensation that is salary, not \"\"keeping you from working for the competition\"\", is the wage paid consistent with minimum wage, or does it have to draw from the pool of money that is not about wage but is about incentivizing you to not move. And, finally, if they stop paying you, and each day you've been paid a little to work and a little to incentivize you to leave, then are you getting a continued revenue stream to continue to incentivize you not to work for the competition? If not, there would seem again not to be consideration. As I said, I'm not an expert in this. I just follow such matters sometimes in the news. But I don't see these issues getting discussed here and I hope we'll see some useful responses from the crowd here, and also the smart folks at reddit can help through their discussions to form some useful political and legal defenses to help individuals overcome what is really a moral outrage on this matter. Capitalism is an often cruel engine. I worked at a company where one of the bosses said to me, after contributing really great things that added structurally in fundamental ways to the company, \"\"don't tell me what you've done, tell me what you've done lately\"\". Capitalism makes people scrap every day to prove their worth. So it's morally an outrage to see it also trying even as it beats down the price of someone and tells them they aren't entitled to better, to tell them that they may not go somewhere else that thinks they are better. That is not competition and it is not fair. Indentured servitude, not slavery, is more technically correct. And yet it is a push to treat people like capital, so slavery is not inappropriate metaphorically. The topic is non-competes, but really it's about businesses not wanting to have to compete for employees; that is, about businesses not wanting capitalism to prevail in hiring. Sorry for the length.\"", "title": "" }, { "docid": "f3bcddaa2b5780a003a5fcbafe1192b8", "text": "I'd say the best course of action would be to call the card issuer and ask them. Converting can definitely be done, but you'll have to enquire about the bonus.", "title": "" }, { "docid": "d929a83525198d8bcaa21e1d80564f57", "text": "\"Do you need the capital? If you not, are you considering taking it to help you grow faster? To lower your downside risk? In terms of deal structure start with your financial model and evaluate your payback period and IRR... Think if you were investor how much of a split would you need to compensate the risk you are taking. Generally the investor will want to get 100% of their original investment paid back plus a annual 8% \"\"preferred\"\", return and after they are made whole 80% of proceeds, but I've seen restaurant deals at 50/50 splits and no preferred return. I'd try to ensure you get a salary and/or management fee. Make sure you retain control and rights! Don't sign anything without legal review.\"", "title": "" } ]	fiqa
f5460f85001a5752b519c36bd4364d71	Home insurance score drastically decreases after car insurance claim?	[ { "docid": "c34ca0db99f3e867702f4d72a4ea6803", "text": "Credit risk and insurance risk are highly correlated for a single legal party. Trouble with one could indicate trouble with another. Any increase in credit risk such as new borrowing will be perceived to be an increased likelihood of insurance risk, manifested as a fraudulent or subconsciously induced claim. Any claim of insurance will be perceived to be an increased likelihood of default, manifested as a default, voluntary or not. To a creditor/insurer, only the law applies; therefore, private arrangements between the borrower/insured and third parties do not factor because the creditor/insurer has no hope of recourse against such third parties in most places around the world. Regardless of whether there is a price ceiling on compensation for damages to assets, limiting an insurers costs, if a risk is realized then it can be presumed through sequential sampling as well as other reliable statistical techniques that future risk has risen. The aforementioned risk dominoes subsequently fall. Generally speaking, the lower one's financial variance, the lower the financial costs. In other words, uncertainty can be mostly quantified with variance and other mathematical moments as well. Any uncertainty is a cost to a producer thus a cost to the consumer. A consumer who is perfectly predictable with good outcomes will pay much lower costs on average than not, so one who keeps a tight financial ship, not exposing oneself to financial risks and better yet not realizing financial risks, will see less financial variance, thus will enjoy lower costs to financing, which includes insuring.", "title": "" } ]	[ { "docid": "ab8ad3914e9ced9d72270d68dca2c20f", "text": "Auto Insurance score is in no way related to your driving habits, instead it is based on your credit usage. You are often punished for having more than one or two hard inquires in a year and they also frown upon having many lines of credit even though that helps your credit utilization.", "title": "" }, { "docid": "0f8d360bbfa515fcd8bcf8cda182b071", "text": "As a recent college grad who switched to his own car insurance, many of the things I did myself are reflected here. The #1 thing I did was find out what coverages I had, what coverages some friends of mine had (car enthusiasts mostly - they're the most informed on this stuff), and then figured out what kind of coverages I wanted. From there, I went around getting quotes from anyone and everyone and eventually built out a sizeable spreadsheet that made it obvious which company was going to offer me the best rate at a given coverage level. Something else to remember - not all insurance companies look at past accidents and violations (speeding, etc) the same. In my search, I found some have a 3-year scope on accidents and violations, while others were as much as 5 years. So, if your driving record isn't a shining example (mine isn't perfect), you could potentially save money by considering insurance through a company that will see fewer violations/incidents than another because of the size of their scope. I ended up saving $25/mo by choosing a company that had a 3-year scope, which was on the cusp of when my last violation/incident occurred. Insurance companies will also give out discounts for younger drivers based on GPA average. If you have kids and they maintain a high GPA, you might be able to get a discount there. Not all companies offer it, so if they do it's worth finding out how much it is", "title": "" }, { "docid": "af52cfcb915053566f367e38d37bb78e", "text": "I believe your statement is mostly correct: ...all the expert recommendations are based on an inflexible conventional wisdom that presumes that all renters are relatively resource-poor. When you purchase a $50 electronic item at the store and are offered an extended warranty for $3, most people turn it down, not only because they don't think it's worth it, but also because in the event that the item fails between say years 1 and 3, they don't worry enough about that $50 to care if they have to buy a new one, or live without it. The percentage of your net worth also matters. For example, if you had an entire loss tomorrow, you'd be out $20K if you needed to re-purchase your possessions. (30K minus 10K in current coverage.) $20K is approximately 1/44 or 2.3% of your net worth. If a catastrophe occurs and you only lose 2.3% of your net worth, some might consider that lucky, so from that point of view it isn't really a big deal. But on the flip side, if the extra insurance only costs you $50 more per year, you may not even notice that dent in your net worth either. I think for most people, the value of items in their home may be their net worth, or at least a much larger percentage of it, in which case the insurance makes more sense. For someone in your position, it probably doesn't make much difference either way. If you had $300K in valuables in your house, perhaps your point of view would be different.", "title": "" }, { "docid": "2cb63618bee4d87bda4c2862ca8643b8", "text": "Why doesn't it seem right to you? The lender financed the house and has the first right claim (mortgage) on it, so if you have any insurance proceeds they're first offsetting your debt to the lender. Same as if you were selling the house - first the loan is paid off, whatever is left goes to you. If the property is not lost, then the proceeds are going to you and you keep paying the mortgage. So if a pipe burst and you need to replace the flooring, the insurance will cover it, and you'll get the proceeds. If the building is lost and you're paid the fair market/rebuild value, then you first need to pay off the mortgage. Its standard.", "title": "" }, { "docid": "e603269a11966858958015d59829137d", "text": "\"Don't use a \"\"credit repair\"\" agency. They are scams. One of the myriad of ways in which they work is by setting you up with a bogus loan, which they will dutifully report you as paying on time. They'll pretend to be a used car dealer or some other credit-based merchant. For a time, this will actually work. This is called \"\"false reporting.\"\" The problem is, the data clearinghouses are not stupid and eventually realize some hole-in-the-wall \"\"car dealer\"\" with no cars on the lot (yes, they do physical inspections as part of the credentialing process, just sometimes they're a little slow about it) is reporting trade lines worth millions of dollars per year. It's a major problem in the industry. But eventually that business loses its fraudulent reporting ability, those trade lines get revoked, and your account gets flagged for a fraud investigation. The repair agency has your money, and you still don't have good credit. Bad news if this all goes down while you're trying to close on a house. You're better off trying to settle your debts (usually for 50%) or declaring bankruptcy altogether. The latter isn't so bad if you're in a stable home, because you won't be able to get an apartment for a while, credit cards or a good deal on auto financing. ED: I just saw what one agency was charging, and can tell you declaring bankruptcy costs only a few hundred dollars more than the repair agency and is 100% guaranteed to get you predictable results as long as you name all your debts up front and aren't getting reamed by student loans. And considering you can't stomach creditors-- well guess what, now you'll have a lawyer to deal with them for you. Anything you accomplish through an agency will eventually be reversed because it's fraudulent. But through bankruptcy, your credit will start improving within two years, the tradeoff being that you won't be able to get a mortgage (at all) or apartment (easily) during that time-- so find a place to hunker down for a few years before you declare.\"", "title": "" }, { "docid": "36b4aa8281b6d0bed022cc321bfb03ee", "text": "\"I'm really surprised at the answers here. Claims/year per region isn't a statistic that is meaningful here... you need to think about the risk factors and the purpose of the insurance. First, what does title insurance do? It protects you against defects in the deed -- defects that may crop up and mean that your mortgage is no longer valid. This is different from most forms of insurance -- the events that render your title invalid are events that may have happened years, decades or even centuries ago. A big part of the insurance policy and its cost is conducting research to assess the validity of a deed. The whole point of the insurance is to reduce claims by improving data associated with the \"\"chain of custody\"\" of the property. So how do you evaluate the risk of finding out about something that happened a long time ago, that nobody appears to know about? IMO, you have to think about risk factors that increase the probability that things were screwed up in the past: You need to have an informed discussion with your attorney and figure out if it makes sense for you. Don't dismiss it out of hand.\"", "title": "" }, { "docid": "084088085c5d314c7889b4ff5d7668ba", "text": "\"Let's face it: most people pay more in insurance premiums than they \"\"get back\"\" in claims. I put \"\"get back\"\" in quotes because, with very few exceptions, the money paid out in claims does not go to the insured, but to others, such as doctors and hospitals. But even if you ignore the question who does the money actually go to, it's a losing proposition for most people. The exceptions are those who have a major loss, greater than what they put in over the years. But never forget: these are exceptions. The return on your money, on the average, is only a little better than playing the lottery. The usual counter-argument to the above is, but what if you are one of the exceptions? I for one refuse to let my life be dictated by worries of unlikely events that might happen. If you're the sort who obsesses on what could (but probably won't) happen, then maybe you should have insurance. Just don't tell me I need to do the same. When I lived in California, they had a program where you could deposit $25,000 with the State, and then you could drive, legally, without insurance. I did this for a while, didn't have any accidents, and exited the system (when I moved out of state) a few years later with more money (interest) than I put in. You don't accomplish that with insurance. But let's get back to rich people. Unless you get into an accident with you at fault and the other guy needing a head transplant as a result (joke), you could probably absorb the cost of an accident without blinking an eye. Those in the upper-middle-class might do well with high-deductible insurance that only pays out if there's an extreme accident. Then again if you have to borrow to buy something expensive (making monthly payments), they will usually demand you buy insurance with it. This is a way for the lender to protect himself at your expense, and if you refuse, good luck getting a loan somewhere else. I hate the idea of insurance so much I would make an act of insurance punishable by law.\"", "title": "" }, { "docid": "93cfc7f27a3b137773cb171345b602eb", "text": "I doubt it. If you have a good track record with your car loan, that will count for a lot more than the fact that you don't have it anymore. When you look for a house, your debt load will be lower without the car loan, which may help you get the mortgage you want. Just keep paying your credit card bills on time and your credit rating will improve month by month.", "title": "" }, { "docid": "5a8fb59d672228ef0294113ad9e05b3d", "text": "\"Insurance is bought for peace of mind and to divert disaster. Diverting disaster is a good/great thing. If your house burned down, if someone hit your car, or some other devastating event (think medical) happened that required a more allocation than you could afford the series of issues may snowball and cause you to lose a far greater amount of money than the initial incident. This could be in the form of losing work time, losing a job, having to buy transportation quickly paying a premium, having to incur high rate debt and so on. For the middle income and lower classes medical, house, and medical insurance certainly falls into these categories. Also why a lot of states have buyout options on auto insurance (some will let you drive without insurance by proving bonding up to 250K. Now the other insurance as I have alluded to is for peace of mind mainly. This is your laptop insurance, vacation insurance and so on. The premise of these insurances is that no matter what happens you can get back to \"\"even\"\" by paying just a little extra. However what other answers have failed to clarify is the idea of insurance. It is an agreement that you will pay a company money right now. And then if a certain set of events happen, you follow their guidelines, they are still in business, they still have the same protocols, and so on that you will get some benefit when something \"\"disadvantageous\"\" happens to you. We buy insurance because we think we can snap our fingers and life will be back to normal. For bigger things like medical, home, and auto there are more regulations but I could get 1000 comments on people getting screwed over by their insurance companies. For smaller things, almost all insurance is outsourced to a 3rd party not affiliated legally with a business. Therefore if the costs are too high they can simply go under, and if the costs are low they continue helping the consumer (that doesn't need help). So we buy insurance divert catastrophe or because we have fallen for the insurance sales pitch. And an easy way to get around the sales pitch - as the person selling you the insurance if you can have their name and info and they will be personally liable if the insurance company fails their end of the bargain.\"", "title": "" }, { "docid": "3b2684744c9a4f150f9725871ea78493", "text": "\"Ok sure, your homeowners insurance now includes all those things. Floods, hurricanes, terrorism... its also now twice the price. You're on /r/finance, not /r/politics. You should understand that you pay a premium for every risk that you off-lay. It is well known that basic homeowners insurance does not cover floods. If you want it, you can get it. Most people in a non flood-prone area will say, \"\"I'm willing to take that risk, I'll save $500/yr and not get it\"\". Would you rather the government just force you to get it? You just complained about Auto Insurance \"\"forcing\"\" you to get uninsured driving insurance. You can't have it both ways.\"", "title": "" }, { "docid": "ab252f1dce22980b61eddfe374b686c3", "text": "\"> Let's just say the insurance industry knows a lot more about underwriting than you do. I'm sorry, but that is a meaningless statement. I work in insurance (first as a consultant, before 'retiring' to work in insurance distribution a few years ago), and I know that our industry frequently uses flawed or outdated methodologies due to the simple fact that insurance companies are very conservative and very resistant to change when it comes to changes to their core business. Unless you can show a direct, negative impact on the bottom line caused by the currently used method, you are unlikely to make any changes at all. In this case, if the entire US car insurance industry is using the same flawed system, it won't affect a single company if they also stick to it. Until 1996, before the current system was introduced, insurance companies in Germany used to rate liability insurance for cars (almost) exclusively by engine power output. The industry had known that this method was fundamentally flawed since at least the late 1980s (comprehensive and partial coverage had been rated by the 'new' system for a few years at this point, which had also taken years to work out), but it took additional years of planning, negotiations and cooperation by the entire industry to change to the new system for liability. So please, do not ever assume that \"\"the insurance companies are the experts, they know what they are doing!\"\". It might very well be the case that they are stuck with flawed/outdated systems simply because there is no sufficiently strong impulse to change what they do. The current Tesla rate adjustment situation is a wonderful example of this - it apparantly took AAA 5 years since the Model S first came out to realise that their initial estimate was wrong (it seems unlikely that the accident rate or repair costs have suddenly changed over the last year) and take appropriate actions. By late 2013, there were easily enough Teslas on the road (about 20,000) to get realiable data, yet nothing happened for nearly another 4 years.\"", "title": "" }, { "docid": "dc0f3b07ea6236f4f0c99ab99df27344", "text": "First you should understand the basics of how insurance companies make money: In a simple scenario, assume 1,000 have car insurance. Assume that on average, 100 people have accidents per year, and that each accident costs $10,000. So, we can expect total costs to be $1,000,000 per year. Some of those costs will be paid by the drivers, who have some sort of 'deductible'. That is - the insurance company will only cover costs after the driver has themself paid some initial amount [something like, the first $1,000 of repairs is paid by the driver]. So now the insurance company expects to have to pay out $900,000 in total claims this year. If they want to pay those claims (and also pay their administrative costs, and earn a profit), they might want to have $1,250,000 in revenue. Across 1,000 people, that would be $1,250 / year in insurance premiums. Of course, the big question for the insurance company is: how much will they really need to pay out in insurance claims each year? The better they can predict that number, the more profitable they can be [because they can charge a much more accurate amount, which can earn them new customers and gives them insurance {pun} that each new customer is actually profitable to them on average]. So the insurance company spends a lot of time and money trying to predict your likelihood of a car accident. They use a lot of metrics to do this. Some might be statistical hogwash that they charge you because they feel they can [if every insurance company charges you extra for driving a 2-door instead of a 4-door, then they all will], and some might be based in reality. So they attempt to correlate all of the items in your list, to see if any of those items indicates that you should be charged more (or less) for your insurance. This is equal parts art and science, and a lot of it comes down to how they market themselves. ie: if an insurance company gives a discount for being in college, is that because college drivers are better drivers, or is it because they want to increase the number of young customers they have, so they can keep those customers for life? Therefore how each metric factors into your calculation will be based on the company using it. It would basically be impossible to 'come up with' the same answer as the insurance company by having the information you provided, because of how heavily dependant that answer is on statistics + marketing. As for how your state matters - some states may have different accident rates, and different payout systems. For example - is Hawaii driving more dangerous because of all the tourists driving rented cars faster than they should? Is New York less expensive to insure because better public health care means less cost is borne by the insurance company in the event of an accident [I have no idea if either of these things are the case, they are purely for hypothetical discussion purposes]. In short, make sure you get quotes from multiple providers, and understand that it isn't just the cost that changes. Check changes in coverage and deductibles as well [ie: if one company charges you $100 / month when everyone else charges $200 / month - make sure that the cheaper company doesn't limit its coverage in ways that matter to you].", "title": "" }, { "docid": "8b3fafaa967083f6341aed5116b52e70", "text": "There is not necessarily a need to prevent what you describe - 'turning insurance on before high risk situations'. They just need to calculate the premiums accordingly. For example, if an insurance needs to take 50$/year for insuring your house against flood, and a flood happens in average every 10 years, if you just insure the two weeks in the ten years where heavy rain is predicted, you might pay 500$ for the two weeks. The total is the same for the insurance - they get 500$, and you get insurance for the dangerous period. In the contrary; if a flooding (unexpectedly) happens outside your two weeks, they are out. From the home owners view, 500$ for two weeks when heavy rains and floods are expected, and nothing otherwise sounds pretty good, compared to 50$ every year. It is the same of course, but psychology works that way.", "title": "" }, { "docid": "58b853a5f93b434b3e96005b68d504b4", "text": "\"Well, that's about 3% higher than the national average, so... I'm not sure if we should be relieved or disturbed. Personally, I find it deplorable that insurance companies are allowed to randomly exclude pesky unprofitable things they don't want to cover. Floods? No thanks. Dental/Vision? Why ever would you consider those \"\"medical\"\" issues? Uninsured drivers? Yeah, you live in a state that requires 100% of drivers have insurance, but suck it anyway, since you have no choice, mwa-hahaha! And people seriously wonder why I utterly loathe insurance companies. Insurance \"\"fraud\"\" should be viewed not as a crime, but as the moral frickin' high ground; it's insurance itself that is little short of fraud-hidden-in-a-6pt-font.\"", "title": "" }, { "docid": "055d50d1148a5045c9afa3008cdd3e96", "text": "\"It's not my title. It's the original title. I was pointing out that as a headline, it makes more sense to point out that the businesses are apparently against this regulation. Rather than have the headline be formulated as a tautology, i.e. \"\"Consumers win after CFPB opens door to thing that benefits consumers\"\".\"", "title": "" } ]	fiqa
7859e259053add617db1ccb78bf8cdab	GnuCash register reimbursements	[ { "docid": "1ead9519c377d41cada5b7e5d4c8af17", "text": "You should be recording the reimbursement as a negative expense on the original account the expense was recorded. Let's assume you have a $100 expense and $100 salary. Total $200 paycheck. You will have something like this In the reports, it will show that the expense account will have $0 ($100 + ($100)), while income account will have $100 (salary).", "title": "" } ]	[ { "docid": "b15743b1f36eff257bb2746227355339", "text": "Dwolla looks to be a great option. But it requires users to have an account there (Free to sign up). And there rates are absolutely amazing. Free for transactions under $10 $0.25 to receive money on transactions over $10", "title": "" }, { "docid": "c7eaa130ef48b436d0261060eaf23c20", "text": "If you're audited routinely you probably have an accountant to get this straight. It's not something that I would be too worried about as it is purely journal-entry issue, there's no problem with the actual money. Mistakes happen. I'd suggest converting the currency, taking loss/gain on the conversion as a capital loss/gain, and credit the correct currency to the correct account. If GnuCash causes problems - just record it in the EUR equivalent, putting in notes the actual SGD value. Note that I'm not an accountant and this is not a professional advice.", "title": "" }, { "docid": "b271d9e194b2804f29fa416d2c768db0", "text": "Get the cash you need to expand your business! Free information. Call Now. 866-334-8705. Our goal: Helping small companies rebuild in this economy through private lending. We are looking for business owners that want to save money on their credit card processing or begin accepting credit cards. Grow your business now with a Merchant Cash Advance. Funding of 100 - 300% of your monthly sales, no points or upfront fees! No fixed monthly payment! Payment is automatically collected through credit card sales. We have partnered with several processors and other service providers to ensure the ability to offer Credit Card Processing with the lowest possible rates and fees for processing and funding in the industry. We also offer Gift Cards and Loyalty Programs to help you with repeat business. Call 866-334-8705 and mention Agent #22104 to speak to one of our knowledgeable representatives that can give you a quote today. http://agent.vendorsmerchantnetwork.com/22104 Our goal is to develop a custom tailored structure for your particular business' needs and desires. This enables you to process in the most cost efficient manner available in the industry! Features 24/7 Customer Support Lowest Processing Rates in the Industry Free Terminal Reprogram No Termination Fee In addition, even in this difficult economic time, we offer Merchant Cash Advances to qualified applicants! DON'T WAIT TO GET THE MONEY YOU NEED TO EXPAND YOUR BUISNESS! CALL US TODAY!", "title": "" }, { "docid": "4a34fbc4103ce3d39567284a17480747", "text": "\"Your debits and credits are perfect. Now, it comes down to a choice of how you want your accounts organized, financially speaking. In terms of taxes, it's recommended you keep a separate set of books just like a corporation and account for them strictly according to law. It's best not to credit phone expenses since it will no longer show on your net reports. A better alternative would be \"\"Phone reimbursement\"\". With that, you can not only see if you've been compensated but also how much you're personally managing these expenses by checking the annual \"\"Phone expense\"\" account. This is all up to personal preference, but so long as you're properly balancing your accounts, you can introduce any level of resolution you wish. I prefer total resolution when it comes to financial accounting. Also, it is not good practice to debit away \"\"Salary\"\". The net of this account will be lower and distorted. An expense reimbursement is not salary anyways, so the proper bookings will follow below. Finally, if GnuCash is calling \"\"Salary\"\" an income account, this is unfortunate. The proper label would be \"\"revenue\"\" since \"\"income\"\" is a net account of expenses from revenue in the income identity. Entries With this, your books will become clearer: your cash assets will remain as clear as you had organized them, but now your income statement will provide higher resolution.\"", "title": "" }, { "docid": "4f7d9c6d9bd9a85810ebab48a59bacba", "text": "Because a paying down a liability and thus gaining asset equity is not technically an expense, GnuCash will not include it in any expense reports. However, you can abuse the system a bit to do what you want. The mortgage payment should be divided into principle, interest, and escrow / tax / insurance accounts. For example: A mortgage payment will then be a split transaction that puts money into these accounts from your bank account: For completeness, the escrow account will periodically be used to pay actual expenses, which just moves the expense from escrow into insurance or tax. This is nice so that expenses for a month aren't inflated due to a tax payment being made: Now, this is all fairly typical and results in all but the principle part of the mortgage payment being included in expense reports. The trick then is to duplicate the principle portion in a way that it makes its way into your expenses. One way to do this is to create a principle expense account and also a fictional equity account that provides the funds to pay it: Every time you record a mortgage payment, add a transfer from this equity account into the Principle Payments expense account. This will mess things up at some level, since you're inventing an expense that does not truly exist, but if you're using GnuCash more to monitor monthly cash flow, it causes the Income/Expense report to finally make sense. Example transaction split:", "title": "" }, { "docid": "fcad8e8e16fb8e86b9784b90ea346cf7", "text": "The GnuCash manual has a page with examples of opening new accounts. The tl;dr is: use the Equity:Opening Balance to offset your original amounts. The further explanation from the GnuCash page is: As shown earlier with the Assets:Checking account, the starting balances in an account are typically assigned to a special account called Equity:Opening Balance. To start filling in this chart of account, begin by setting the starting balances for the accounts. Assume that there is $1000 in the savings account and $500 charged on the credit card. Open the Assets:Savings account register. Select View from the menu and check to make sure you are in Basic Ledger style. You will view your transactions in the other modes later, but for now let’s enter a basic transaction using the basic default style. From the Assets:Savings account register window, enter a basic 2 account transaction to set your starting balance to $1000, transferred from Equity:Opening Balance. Remember, basic transactions transfer money from a source account to a destination account. Record the transaction (press the Enter key, or click on the Enter icon). From the Assets:Checking account register window, enter a basic 2 account transaction to set your starting balance to $1000, transferred from Equity:Opening Balance. From the Liabilities:Visa account register window, enter a basic 2 account transaction to set your starting balance to $500, transferred from Equity:Opening Balance. This is done by entering the $500 as a charge in the Visa account (or decrease in the Opening Balance account), since it is money you borrowed. Record the transaction (press the Enter key, or click on the Enter icon). You should now have 3 accounts with opening balances set. Assets:Checking, Assets:Savings, and Liabilities:Visa.", "title": "" }, { "docid": "abd4755517ae5ac8d79c1cb42bdf209a", "text": "I think something you might want to look at is a service called Dwolla. They charge $0.25 per transaction, and are free for transactions under $10.", "title": "" }, { "docid": "16581677e644eac47253d3d85e446f77", "text": "I suggest you have a professional assist you with this audit, if the issue comes into questioning. It might be that it wouldn't. There are several different options to deal with such situation, and each can be attacked by the IRS. You'll need to figure out the following: Have you paid taxes on the reimbursement? Most likely you haven't, but if you had - it simplifies the issue for you. Is the program qualified under the employers' plan, and the only reason you're not qualified for reimbursement is that you decided to quit your job? If so, you might not be able to deduct it at all, because you can't take tax benefits on something you can be reimbursed for, but chose not to. IRS might claim that you quitting your job is choosing not to get reimbursement you would otherwise get. I couldn't find from my brief search any examples of what happened after such a decision. You can claim it was a loan, but I doubt the IRS will agree. The employer most likely reported it as an expense. If the IRS don't contest based on what I described in #2, and you haven't paid taxes on the reimbursement (#1), I'd say what you did was reasonable and should be accepted (assuming of course you otherwise qualify for all the benefits you're asking for). I would suggest getting a professional advice. Talk to a EA or a a CPA in your area. This answer was not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on the taxpayer", "title": "" }, { "docid": "b4510cf6016c180b947eab26ae6b837c", "text": "\"Here's a very basic MySQL query I put together that does what I want for income/expense report. Basically it reports the same info as the canned income/expense report, but limits it those income/expenses associated with a particular account (rental property, in my case). My main complaint is the output \"\"report\"\" is pretty ugly. And modifying for a different rental property requires changing the code (I could pass parameters etc). Again, the main \"\"issue\"\" in my mind with GnuCash income/expense report is that there is no filter for which account (rental property) you want income/expenses for, unless you set up account tree so that each rental property has its own defined incomes and expenses (i.e. PropertyA:Expense:Utility:electric). Hopefully someone will point me to a more elegant solution that uses the report generator built into GnuCash. THanks! SELECT a2.account_type , a4.name, a3.name, a2.name, SUM(ROUND(IF(a2.account_type='EXPENSE',- s2.value_num,ABS(s2.value_num))/s2.value_denom,2)) AS amt FROM ( SELECT s1.tx_guid FROM gnucash.accounts AS a1 INNER JOIN gnucash.splits AS s1 ON s1.account_guid = a1.guid WHERE a1.name='Property A' ) AS X INNER JOIN gnucash.splits s2 ON x.tx_guid = s2.tx_guid INNER JOIN gnucash.accounts a2 ON a2.guid=s2.account_guid INNER JOIN gnucash.transactions t ON t.guid=s2.tx_guid LEFT JOIN gnucash.accounts a3 ON a3.guid = a2.parent_guid LEFT JOIN gnucash.accounts a4 ON a4.guid = a3.parent_guid WHERE a2.name <> 'Property A' # get all the accounts associated with tx in Property A account (but not the actual Property A Bank duplicate entries. AND t.post_date BETWEEN CAST('2016-01-01' AS DATE) AND CAST('2016-12-31' AS DATE) GROUP BY a2.account_type ,a4.name, a3.name, a2.name WITH ROLLUP ; And here's the output. Hopefully someone has a better suggested approach!\"", "title": "" }, { "docid": "c5acafc129ddd9f53bcfcca2fc88678d", "text": "If you would like to use linux I suggest you to use KMyMoney http://kmymoney2.sourceforge.net/ It is based on gnucash but it is easier to use IMO", "title": "" }, { "docid": "865615acb30248354ccda7ef4be8a01b", "text": "\"I've been in a very similar situation to yours in the past. Since the company is reimbursing you at a flat rate (I assume you don't need to provide documentation/receipts in order to be paid the per diem), it's not directly connected to the $90 in expenses that you mention. Unless they were taking taxes out that would need to be reimbursed, the separate category for Assets:Reimbursable:Gotham City serves no real purpose, other than to categorize the expenses. Since there is no direct relationship between your expenses and the reimbursement, I would list them as completely separate transactions: Later, if you needed to locate all of the associated expenses with the Gotham trip, gnucash lets you search on memo text for \"\"Gotham\"\" and will display all of the related transactions. This is a lot cleaner than having to determine what piece of the per diem goes to which expenses, or having to create a new Asset account every time you go on a trip.\"", "title": "" }, { "docid": "653e490ace6c1b315324cea013d7d9ef", "text": "Not correct. First - when you say they don't tax the reimbursement, they are classifying it in a way that makes it taxable to you (just not withholding tax at that time). In effect, they are under-withholding, if these reimbursement are high enough, you'll have not just a tax bill, but penalties for not paying enough all year. My reimbursements do not produce any kind of pay stub, they are a direct deposit, and are not added to my income, not as they occur, nor at year end on W2. Have you asked them why they handle it this way? It's wrong, and it's costing you.", "title": "" }, { "docid": "d843bca1e943e85e1b0348c3812e7a6c", "text": "\"GNUCash won't show 'Credit Card' type accounts in \"\"Process Payment\"\", as of v.2.6.1. A workaround is to create another account of type A/Payable. Then, transfer the operations you want to pay via \"\"Process Payment\"\" to this new account. It should be visible now. A drawback is that you have split your current Credit Card debt, which makes it harder to track. Alternatively you may wish to only use this new account for all your credit card related expenses. Another alternative is processing payments for these purchases manually to keep the 'credit card' accounts consistent.\"", "title": "" }, { "docid": "1c4a0bcd6ec884cb4e38e9035f7e5ffb", "text": "I haven't used it in years, but look at GnuCash. From the site, one bullet point under Feature Highlights:", "title": "" }, { "docid": "3bbda03f837541c501058d5c2e9831a5", "text": "Given your needs, GNUcash will do swimmingly. I've used it for the past 3 years and while it's a gradual learning process, it's been able to resolve most stuff I've thrown at it. Schedule bills and deposits in the calendar view so I can keep an eye on cash flow. GNUcash has scheduled payments and receipts and reconcilation, should you need them. I prefer to keep enough float to cover monthly expenses in accounts rather than monitor potential shortfalls. Track all my stock and mutual fund investments across numerous accounts. It pulls stock, mutual and bond quotes from lots of places, domestic and foreign. It can also pull transaction data from your brokers, if they support that. I manually enter all my transactions so I can keep control of them. I just reconcile what I entered into Quicken based on the statements sent to me. I do not use Quicken's bill pay There's a reconciliation mode, but I don't use it personally. The purpose of reconcilation is less about catching bank errors and more about agreeing on the truth so that you don't incur bank fees. When I was doing this by hand I found I had a terrible data entry error rate, but on the other hand, the bayesian importer likes to mark gasoline purchases from the local grocery store as groceries rather than gas. I categorize all my expenditures for help come tax time. GNUcash has accounts, and you can mark expense accounts as tax related. It also generates certain tax forms for you if you need that. Not sure what all you're categorizing that's helpful at tax time though. I use numerous reports including. Net Worth tracking, Cash not is retirement funds and total retirement savings. Tons of reports, and the newest version supports SQL backends if you prefer that vs their reports.", "title": "" } ]	fiqa
6987655a4eea7c0d53b613f6415eb571	Tax advantages of using 529 plans to save for child's education?	[ { "docid": "20f7479b8a5c1d1d02e6f603d3fbd0c6", "text": "There are several variables to consider. Taxes, fees, returns. Taxes come in two stages. While adding money to the account you can save on state taxes, if the account is linked to your state. If you use an out of state 529 plan there is no tax savings. Keep in mind that other people (such as grandparents) can set aside money in the 529 plan. $1500 a year with 6% state taxes, saves you $90 in state taxes a year. The second place it saves you taxes is that the earnings, if they are used for educational purposes are tax free. You don't pay taxes on the gains during the 10+ years the account exists. If those expenses meet the IRS guidelines they will never be taxed. It does get tricky because you can't double dip on expenses. A dollar from the 529 plan can't be used to pay for an expenses that will be claimed as part of the education tax credit. How those rules will change in the next 18 years is unknown. Fees: They are harder to guess what will happen over the decades. As a whole 401(k) programs have had to become more transparent regarding their fees. I hope the same will be true for the state run 529 programs. Returns: One option in many (all?) plans is an automatic change in risk as the child gets closer to college. A newborn will be all stock, a high school senior will be all bonds. Many (all?) also allow you to opt out of the automatic risk shift, though they will limit the number of times you can switch the option. Time horizon Making a decision that will impact numbers 18 years from now is hard to gauge. Laws and rules may change. The existence of tax breaks and their rules are hard to predict. But one area you can consider is that if you move states you can roll over the money into a new account, or create a second account in the new state. to take advantage of the tax breaks there. There are also rules regarding transferring of funds to another person, the impact of scholarships, and attending schools like the service academies. The tax breaks at deposit are important but the returns can be significant. And the ability shelter them in the 529 is very important.", "title": "" } ]	[ { "docid": "16ae5b99d93ff41de4c55c4bc1eb3386", "text": "I know it isn't exactly the question you asked, but please consider your future too. 529 is the correct answer, because if you can fund a Roth, you should be funding it for your own retirement. Your retirement has much a higher priority over anybody's college fund. It is pretty great that you want to set aside cash for the niece's education, I think asking which vehicle is best for saving for education might be the wrong question. Students have many options for going to school and paying for it but retirement is pretty limited. http://www.clarkhoward.com/news/clark-howard/education/clarks-529-guide/nFZS/ is a good place to learn about 529s and makes good suggestions on where to get one. Do it yourself, and don't pay a broker or agent to do it for you. If your retirement is already handled, feel free to vote me down and I will delete this.", "title": "" }, { "docid": "60bf7b6da0028df6d81ff50b2319201e", "text": "Group RESPs are a bit like a true mutual insurance company. You all pay into the fund, and then, depending on the number of kids that are in school that particular year, you get paid a certain amount. Advantages could be that if you end up with one or two years of only your kid in school and nobody else's in that age bracket, you get more money. Disadvantage for the same-reverse reason also could be true. Another advantage of regular programs, unlike pooled, is that if you do not use all the money, then some/all of the remaining funds may be transferable to an RRSP. Personally I would not invest in one, unless it was more like a specific investment-club that I knew everybody.", "title": "" }, { "docid": "794189dc8a67f3acbb446f5526e69aaf", "text": "While not entirely untouchable, a college fund can also be in the form of an Indexed Universal Life (IUL) contract through a life insurance agent. These often net a higher rate of return annually than any savings account, are not going to tank if the market does, and can be owned by you for the child. If no one else is on the policy, they have no access to it. You can name yourself the beneficiary as well. There's several very nice features to doing your child's college funding this way. You can ask that the contract is established for maximum cash value. This means the death benefit isn't the overriding need so the premiums you pay fill the cash value of the contract much more quickly. As mentioned in point 1., the contract has a death benefit. No other savings device will grant you this. Heaven forbid the child passes while you are saving for college. Now you will have a tax free benefit that will pay for burial and other related costs and can be used to fund yet another IUL policy if you have more than one child. Unlike other policies, you can set your minimum monthly premium and have the flexibility to add as much as you would like to fill the fund faster if you happen to come into more money and you want to direct it to that contract. There are ceilings to this so that you don't create a modified endowment contract (MEC. Look this up at investopedia), but this is specifically stated in your illustration so that you can keep your contributions a penny under that limit. Unlike college loans, you have extremely quick access to the funds when you need them (probably counter-intuitive to your desire for untouchable money). This can be achieved a couple of ways. You can borrow money from the insurer using your IUL cash value as collateral. Often, a check can be cut within 48 hours. This eliminates the time a normal lender takes in making the loan decision. Or, you can surrender the policy and take the cash value (paying taxes on your gains). The first keeps the policy in force while you pay back the loan if you desire. The second cancels the policy so that you can take your own accumulated money out. Utilizing an IUL in this manner can (but not always) lower your Expected Family Contribution (EFC) with colleges so that you could qualify for higher student aid. If your income puts you in the middle class, you would be wise to note this in particular. Having control over your EFC is major benefit. (If you'll read the link above, you notice the UGMA isn't necessarily the best idea as schools look to the student to give a higher percentage of their own assets than the parent.) Ultimately, while the IUL is a little known method for saving for college (and some will argue what they may) it would benefit you to speak with an insurance professional about this option. Ask if the insurer has access to the SAGE Rewards program (https://secure.tuitionrewards.com/). The program is a free benefit if you purchase a cash value contract like an Indexed Universal Life policy and activates IF the agency participates. The child earns tuition credits for every birthday of your child (not retroactive) and for having the policy. If you do an annual review, you earn more tuition credits. I have established these for clients and some have sent their child to college with more than 44k in college funding (split out over four years). The point system is 1 credit = 1 tuition dollar. Quite unlike air miles! For those of you reading this that have similar concerns, please consult an with an agent (or feel free to contact me) to get up to date advice on how to structure these. They are simple and efficient and have significant upside for college funding.", "title": "" }, { "docid": "16e25911a45c2f58774a7d7359982862", "text": "I was in a similar situation with my now 6 year old. So I'll share what I chose. Like you, I was already funding a 529. So I opened a custodial brokerage account with Fidelity and chose to invest in very low expense index fund ETFs which are sponsored by Fidelity, so there are no commissions. The index funds have a low turnover as well, so they tend to be minimal on capital gains. As mentioned in the other answer, CDs aren't paying anything right now. And given your long time to grow, investing in the stock market is a decent bet. However, I would steer clear of any insurance products. They tend to be heavy on fees and low on returns. Insurance is for insuring something not for investing.", "title": "" }, { "docid": "1fabf957eff80d0895815ff0de31c158", "text": "Dazed, an RESP is a type of account. Within the RESP, you can have cash, investments or even savings vehicles like GICs etc. So depending on where you put the money within the RESP, yes, there is a chance of losing money. If you think your children will attend post secondary education, I don't think that there is a better way to save. The government will match 20% of your contribution, up to a maximum grant of $500 per year. To take advantage of the grant, we contribute $2500 per year to obtain the maximum $500 grant. Hope this helps!", "title": "" }, { "docid": "0aa16b8a07ae8ff46fd91f3e373b6fd0", "text": "The point is to provide for yourself in retirement, so it makes sense that these withdrawals would be penalized. Tax deferred accounts are usually created for a specific cause. Using them outside of the scope of that cause triggers penalties. You mentioned 401(k) and IRA that have age limitations because they're geared towards retirement. In the US, here are other types, and if you intend to spend money in the related areas, they may be worth considering. Otherwise, you'll hit penalties as well. Examples: HSA - Health Savings Account allows saving pre-tax contributions and gains towards medical expenses. You must have a high deductible health plan to be eligible. Can be used as IRA once retired. 529 plans - allow saving pre-tax gains (and in some states pre-tax contributions) for education expenses for you or a beneficiary. If a beneficiary - contributions are considered a gift. There's a tax benefit in long term investing in a regular taxable brokerage accounts - long term capital gains are taxed at a preferable (lower) rate than short term or ordinary income. The difference may be significant. Long term = 1+ year holding. The condition here is holding an investment for more than a year, and there's no penalty for not satisfying it but there's a reward (lower rates) if you do.", "title": "" }, { "docid": "abb269f55d7bd3bd7418fe02121cf251", "text": "At the very least you should invest as much as you can that your employer will match, as they are basically giving you free money for saving. After that I would prioritize a Roth IRA as that offers similar tax benefits with more liquidity. Provided you have enough money available in your emergency fund and have plenty for everyday expenses I see no reason not to max out your 401k after that if you can afford it. However, if your emergency fund is lacking, be sure to put some there. Other investments like a 529 may come into play if you have kids you plan on sending to college, but it all depends on your situation.", "title": "" }, { "docid": "9d46721afdb1579b01535a1da44023d4", "text": "First, can I even roll any my profits into a 529 plan to avoid taxes. No. 529 plans are not pre-tax (except for State taxes in certain States, where 529 contributions are deductible. Ohio is such a State, with certain conditions). For Federal taxes - funding a 529 with yourself as a beneficiary doesn't change a thing on your taxes. Is there any special requirements for the state of Ohio. Yes, see the link above. Essentially you'll be carrying the deduction forward for years until you exhaust it, $2000 at a time. Is there a better solution that I am overlooking. No. If it was easy to avoid income taxes - everyone would be doing it.", "title": "" }, { "docid": "7e14fd18cef192f998b0c0e467ae5465", "text": "Some states will give you a tax deduction for 529 contributions. This will allow some tax savings for money that spends a minimum amount of time in the account. Yes you have missed the best benefit, the tax free growth, but there might be an opportunity for some growth. The child's expenses beyond tuition can be covered by 529 plan. It can even cover room and board if they are living in the dorms, off campus apartment, or even at home. Each University through their financial aid office will calculate the total cost of attendance for each student type. Before doing this you need to look at several things:", "title": "" }, { "docid": "b4888bff0729195733eff5acf5f368f1", "text": "\"I'm in a similar situation. First, a 529 plan can be use for \"\"qualifying\"\" international schools. There are 336 for 2015, which includes many well known schools but also excludes many schools, especially lower level or vocational schools and schools in non-English speaking countries. I ran 3 scenarios to see what the impact would be if you invested $3000 a year for 14 years in something tracking the S&P 500 Index: For each of these scenarios, I considered 3 cases: a state with 0% income tax, a state with the median income tax rate of 6% for the 25% tax bracket, and California with an income tax rate of 9.3% for the 25% tax bracket. California has an addition 2.5% penalty on unqualified distributions. Additionally, tax deductions taken on contributions that are part of unqualified distributions will be viewed as income and that portion of the distribution will be taxed as such at the state level. Vanguard's 500 Index Portfolio has a 10 year average return of 7.63%. Vanguard's S&P 500 Index fund has a 10 year average return of 7.89% before tax and 7.53% after taxes on distributions. Use a 529 as intended: Use a 529 but do not use as intended: Invest in a S&P 500 Index fund in a taxable account: Given similar investment options, using a 529 fund for something other than education is much worse than having an investment in a mutual fund in a taxable account, but there's also a clear advantage to using a 529 if you know with certainty you can use it for qualified expenses. Both the benefits for correct use of a 529 and the penalties for incorrect use increase with state tax rates. I live in a state with no income tax so the taxable mutual fund option is closer to the middle between correct and incorrect use of a 529. I am leaning towards the investment in a taxable account.\"", "title": "" }, { "docid": "fd1024f7cd9f34366d2a4e2d2d54b67e", "text": "When I think of the loopholes that the richest of the rich exploit to get out of paying taxes, this article does seem kind of pointless. Why attack the 529 plan? It would be better to attack the expense of the education and the need for the plan in the first place. Upper middle classers shouldn't have to give a second thought to how much it will cost to send their kids to university, unless it is a private school. 30 years ago it cost 350 bucks for a semester. Now it is 10k or more. We all see that this is ridiculous, but it goes on and on. Rents have doubled or even tripled in the last 7 years and this is normal?", "title": "" }, { "docid": "d88b143f604b061c9ef2d7da84ec1e71", "text": "\"Others have given some good answers. I'd just like to chime in with one more option: treasury I-series bonds. They're linked to an inflation component, so they won't lose value (in theory). You can file tax returns for your children \"\"paying\"\" taxes (usually 0) on the interest while they're minors, so they appreciate tax-free until they're 18. Some of my relatives have given my children money, and I've invested it this way. Alternatively, you can buy the I-bonds in your own name. Then if you cash them out for your kids' education, the interest is tax-free; but if you cash them out for your own use, you do have to pay taxes on the interest.\"", "title": "" }, { "docid": "201c8b6c2f36f1c8f11784382978d6af", "text": "Nice idea, but you will have a potential problem. State lawmakers have already considered this option: I looked at this site: Saving for college because it include info for on all the plans. For Illinois it discuses income tax recapture. Effective January 1, 2007, rollovers from this plan to an out-of-state program are included in Illinois taxable income to the extent of prior Illinois deductions. Effective January 1, 2009, nonqualified distributions from this plan are included in Illinois taxable income to the extent of prior Illinois deductions. Most of the states have similar wording. When looking up the law the key word is recapture. The reason why there is no recapture provision at the federal level is that there is no tax deduction on contributions. The 10% penalty make it less likely that somebody would want to have nonqualified distributions. If a state gives a tax deduction in the year of the contribution they want to demand that tax deduction back if the funds are not used for educational purposes. Generally there are of course provisions for scholarships, death, and disability.", "title": "" }, { "docid": "bc0c40ef937a99bee06ad17089508024", "text": "\"The 529 plan does outline your scenarios. There are stipulations for providing the funds should the child get the scholarship. If the child decides not to go into further education (vocational and community schools count), the money can be withdrawn with a 10% penalty and taxes paid on interest earnings. Taxes wouldn't have to be paid for contributions as taxes were already paid on that money by the gift giver. The 529 could also be transferred to another child in the family (including grandchildren). Here's an excerpt from www.savingforcollege.com: You'll never lose all of your savings. A 529 plan offers tax-free earnings and tax-free withdrawals as long as the money is used to pay for college. If you end up taking a non-qualified withdrawal, you'll incur income tax as well as a 10% penalty - but only on the earnings portion of the withdrawal. Since your contributions were made with after-tax money, they will never be taxed or penalized. You can avoid the penalty if you get a scholarship. There are a few special exceptions to the 10% penalty rule, including when the beneficiary becomes incapacitated, attends a U.S. Military Academy or gets a scholarship. In the case of a scholarship, non-qualified withdrawals up to the amount of the tax-free scholarship can be taken out penalty-free, but you'll have to pay income tax on the earnings. As Savingforcollege.com founder Joe Hurley likes to say, \"\"the scholarships have turned your tax-free 529 investment into a tax-deferred 529 investment\"\". Note, a 529 is ideal for the sum of money you are looking at. A proper trust, set up by a lawyer, will cost as much as $2000 to set up, and would require an annual tax return, both unnecessary burdens. To make matters worse, the trust counts as the child's asset where financial aid is concerned. The 529 counts, but to a much lesser extent.\"", "title": "" }, { "docid": "4f6b7f91feb3b35363e3f89ea2ff6128", "text": "Saving for college you have a couple of options. 529 plans are probably the best bet for most people wanting to save for their kids college education. You can put a lot of money away ~$300k and you may get a state tax deduction. The downside is if you're kid doesn't go to college you may end up eating the 10% penalty. State specific prepaid tuition plans. The upside is you know roughly the return you are going to get on your money. The downside is your kid has to go to a state school in the state you prepaid or there are likely withdrawal penalties. For the most part these really aren't that great of a deal any more. ESAs are also an option but they only allow you to contribute $2k/year, but you have more investment options than with the 529 plans. Traditional and ROTH IRA accounts can also be used to pay for higher education. I wouldn't recommend this route in general but if you maxed out your 401k and weren't using your IRA contribution limits you could put extra money here and get more or really different flexibility than you can with a 529 account. I doubt IRA's will ever be asked for on a FAFSA which might be helpful. Another option is to save the money in a regular brokerage account. You would have more flexibility, but lower returns after taxes. One advantage to this route is if you think your kid might be borderline for financial aid a year or two before he starts college you could move this money into another investment that doesn't matter for financial aid purposes. A few words of caution, make sure you save for retirement before saving for your kids college. He can always get loans to pay for school but no one is going to give you a loan to pay for your retirement. Also be cautious with the amount of money you give your adult child, studies have shown that the more money that parents give their adult children the less successful they are compared to their peers.", "title": "" } ]	fiqa
9cf7b754db197f971578679f54fc6a56	How to search efficiently for financial institutions, credit cards, etc (At least in Canada)?	[ { "docid": "7efd74da2708f7eb6c4eba969a973601", "text": "Searching for Banks or Credit Unions based on their high interest accounts is likely to be a giant waste of your time. The highest you might find is 1.5% not clearing inflation. For anything less than 100k youre better off putting it in a money market fund until you know what you want to do with it, which you can find anywhere.", "title": "" } ]	[ { "docid": "5685b1ded2c93079cd5e6b11fdc85535", "text": "I found that an application already exists which does virtually everything I want to do with a reasonable interface. Its called My Personal Index. It has allowed me to look at my asset allocation all in one place. I'll have to enter: The features which solve my problems above include: Note - This is related to an earlier post I made regarding dollar cost averaging and determining rate of returns. (I finally got off my duff and did something about it)", "title": "" }, { "docid": "7c30e030994a0056aa4467e006942217", "text": "You might check out Thrive. They're almost a carbon copy of Mint from the last I checked, but with some additional and (I think) more useful metrics. For instance, they seemed to help more to plan for future expenses in addition to keeping tabs on individual budgets the way Mint does. Everything is automated in the same way as Mint, though I'm not sure their breadth is as far-reaching now since Mint was bought out by Intuit. Nevertheless, whenever I've had a question on Thrive, I shoot it to the devs and I get a very personal and courteous response within the day. So it depends on what you're looking for: Mint can almost guarantee any US bank will be accessible through their site, however Thrive will work much harder to gain your favor.", "title": "" }, { "docid": "fda5f5c4f7c382202bb5fab7941277f4", "text": "\"The Financial Consumer Agency of Canada (FCAC) has a page specifically about working with a financial planner or advisor. It's a good starting point if you are thinking about getting a financial professional to help you plan and manage your investments. In the \"\"Where To Look\"\" section on that page, FCAC refers to a handful of industry associations. I'll specifically highlight the Financial Planning Standards Council's \"\"Find a planner\"\" page, which can help you locate a Certified Financial Planner (CFP). Choose financial advice carefully. Prefer certified professionals who charge a set fee for service over advisors who work on commission to push investment products. Commission-based advice is seldom unbiased. MoneySense magazine published a listing last year for where to find a fee-only financial planner, calling it \"\"The most comprehensive listing of Canadian fee-only financial planners on the web\"\" — but do note the caveat (near the bottom of the page) that the individuals & firms have not been screened. Do your own due diligence and check references.\"", "title": "" }, { "docid": "18fdf9e3dfc67a60abdd1702ae7f00b6", "text": "Start at Investopedia. Get basic clarification on all financial terms and in some cases in detail. But get a book. One recommendation would be Hull. It is a basic book, but quite informative. Likewise you can get loads of material targeted at programmers. Wilmott's Forum is a fine place to find coders as well as finance guys.", "title": "" }, { "docid": "6abcf621e523ee65aa7dd404b9f5ea6b", "text": "\"I would say a lot of the answers here aren't quite right. The main issue here is that banking is a highly oligopolous industry - there are few key players (the UK, for example, has only 5 major banks operating under a variety of brands: it's all the same companies underneath) and the market is very, very hard to enter owing to the immense regulatory burden. Because the landscape is so narrow and it's possible to keep close tabs on all your competitors, there's no incentive to spend money on shiny new things to keep up with the competition - the industry is purely reactive. If nobody else has an awesome, feature-filled online portal, there's no need for any one bank to make one. If everybody is reactive, and nobody proactive, then it's a short logical deduction that improvements happen at a glacial pace. Also take into account that when you've got this toxic \"\"bare-minimum\"\" form of competition, the question for these people soon turns to \"\"what can we get away with?\"\" which results in things like subpar online portals with as much information as you like delivered on paper for a hefty charge, and extortionate, price fixed administrative fees. Furthermore your transaction history is super valuable information. There are one or two highly profitable companies who collate international transaction data and whose sole job in life is to restrict access to that information to the highest bidders. Your transaction history is an asset in a multibillion dollar per year industry, and as such it is not surprising that banks don't want to give it out for free.\"", "title": "" }, { "docid": "acd5b147c0a42ce678536ffaa6a0db0b", "text": "Canadians can email or text each other money through Interac. It is fast - the longest it's ever taken for me is 20 minutes, often it's less - and secure. You don't need to know each other's banking details or even real names. I've used this to send money to my children, each of whom uses a different bank than I do, and they've used it to send money to friends to pay for concert tickets and the like. You add a security question so if someone else got to the email or text first, they wouldn't get the money. I also get an email once the transfer has gone through, so I know they got it. Some banks limit this to $1000 a day, mine to $3000. Typically there is no fee for the recipient and $1 or $2 for the sender. A dollar on $1000 is way better than a 2 or 3% cc processing fee. But even for $30, a dollar is like 3% and you didn't need to apply for anything or set anything up, and your customers don't need a credit card or to trust you with their credit card details. I keep meeting people who don't know about this. Everyone with a Canadian bank account and an email address or smartphone should know about it.", "title": "" }, { "docid": "4a49dbe1ab2d01de9403f236c843ac2c", "text": "It's not so much a credit card, but a financial institution's online platform that either provides this functionality or not. The following Canadian financial institutions show an itemized list of pre-authorized transactions (not an exhaustive list): The following institutions show a total value of pre-authorized transactions: Most other institutions show the available credit (e.g. Chase Financial used by Amazon Rewards), which give an indication of how much you have to spend. By subtracting the current balance and the available balance from the total credit limit, you can get an indication of the total amount of pre-authorized transactions. Example: $1000 - $500 - $400 = $100 is the amount of pre-authorized transactions. From TD's EasyWeb demo (http://tdeasywebdemo.com/v2/#/en/PFS/accounts/activity/chq), it appears that they don't include pre-authorized transactions in the Available Credit. You can verify for yourself by logging in to online banking after you make a purchase and comparing the Available Credit to [Credit Limit - Current Balance]. If it is equal, then they don't include, if it is different (most likely for the value of the transaction), then they do.", "title": "" }, { "docid": "9e4e5154c4a2adf1d4ec1972f97af03c", "text": "I quite like the Canadian Couch Potato which provides useful information targeted at investors in Canada. They specifically provide some model portfolios. Canadian Couch Potato generally suggests investing in indexed ETFs or mutual funds made up of four components. One ETF or mutual fund tracking Canadian bonds, another tracking Canadian stocks, a third tracking US stocks, and a fourth tracking international stocks. I personally add a REIT ETF (BMO Equal Weight REITs Index ETF, ZRE), but that may complicate things too much for your liking. Canadian Couch Potato specifically recommends the Tangerine Streetwise Portfolio if you are looking for something particularly easy, though the Management Expense Ratio is rather high for my liking. Anyway, the website provides specific suggestions, whether you are looking for a single mutual fund, multiple mutual funds, or prefer ETFs. From personal experience, Tangerine's offerings are very, very simple and far cheaper than the 2.5% you are quoting. I currently use TD's e-series funds and spend only a few minutes a year rebalancing. There are a number of good ETFs available if you want to lower your overhead further, though Canadians don't get quite the deals available in the U.S. Still, you shouldn't be paying anything remotely close to 2.5%. Also, beware of tax implications; the website has several articles that cover these in detail.", "title": "" }, { "docid": "ad95541644e49cb3761095f39c7f52da", "text": "\"I don't see how this concept takes off. First and foremost, BankSimple is NOT a bank but a tech company masquerading as one. BankSimple leaves industry regulation and treasury management -- the CORE of banking, to outside parties. Call me old fashioned, but I prefer to have as few stops between me and my money as possible. If not for a fear of losing it in a robbery and inability to earn interest, I'd shove it under a mattress. So why would I want to bank with an intermediary, who admittently doesn't understand how the process works? How is that \"\"looking out for my interests\"\"? And how is your security better than other institutions that offer 128-bit encryption and multiple security questions to test a customer's identity? I'd like to add that not charging overdraft fees and providing lines of credit to help customers out in the event they spend more than they have is nice in concept, but what happens when those same customers do not make deposits to cover their shortfalls? When it comes to money, people will take advantage of any opportunities they have to circumvent the system. Especially if funds are tight.\"", "title": "" }, { "docid": "90a80872e5049f98aaa0e251e2320590", "text": "Some governments offer business information search for corporations in their jurisdiction. The search results may show the director information for the company. If this information is made publicly available, keep in mind there are websites that make money from indexing publicly available information to show in Google search results. I don't mean to scare you as this is a likely a slim possibility. It really depends on the privacy practices in place at the jurisdiction you're in. But do keep in mind if you're planning on doing business on the side for a few years policies may change. I would call Service Ontario (or whichever province you're incorporating in) or Corporations Canada if federally incorporating and ask them if they offer a business search service and exactly what information they make public. You might be able to reach a Privacy Officer and find out what exactly their policy is.", "title": "" }, { "docid": "394bb6647586be1013b72bbe7b8f1858", "text": "Wells Fargo. They have an account called PMA, an umbrella account for checking, savings, mortgage, and brokerage accounts. It would cost $30/month, but I never had to pay because I have a rollover retirement account that is enough to waive the fees. They count all accounts, including mortgage, which I used to have. Oh, and no restrictions. An added advantage is there are no fees for any of the accounts, nor for some other things, like bank checks, outside ATM fees, etc. I'm in California, so I don't know if the same deal exists in other states. But if you qualify for the free account, it's pretty good. Actually, most of my investments are Vanguard funds. And I have another rollover account with Vanguard, and never pay fees, but I only buy or sell from one Vanguard fund to another, and rarely since I have targeted retirement funds that are designed to be no maintenance. For some reason, I trust Vanguard more than most other funds; maybe because I like their philosophy on low-cost funds, which they started but are now getting more popular.", "title": "" }, { "docid": "218ad6826f704bba9d89d638efed1675", "text": "I can think of two services off the top of my head that offer free credit score information here in the UK. One being from one of the big three. No legal requirement to offer that service for free to consumers as far as I'm am aware There's probably other services too..", "title": "" }, { "docid": "a7671434a339564557edc93906872a24", "text": "Ya small local banks effectively do not exist in Canada. We do however have a number of credit unions. I'm actually going to be defensive of the big five as they are actually well run (or rather well regulated). Our banking context is in many ways radically different up north.", "title": "" }, { "docid": "be563df8add84c300bc12ad439293eec", "text": "I think much of that info is hidden behind pay-walls. Here is one site I've found. http://www.feinsearch.com/ Another that is for non-profits only is guidestar. http://www.guidestar.org/rxg/products/nonprofit-data-solutions/product-information/guidestar-premium/advanced-nonprofit-search.aspx", "title": "" }, { "docid": "35c8505736ac382b8ebbc3fa6b02aea2", "text": "I'm not sure if I am exactly what you are looking for, but I am currently studying finance at a university with a top ten finance program. I would be happy to help you out with your search for a college or program. The stuff about how to dress and act will come later.", "title": "" } ]	fiqa
97f814cda1da8f8cd03473541fd85c56	How to manage paying expenses when moving to a weekly pay schedule and with a pay increase?	[ { "docid": "53c9196acc52be86c9887d8674257cee", "text": "This is really just a matter of planning. It's good that you don't want the train to go off the rails but really you just need to budget your fixed expenses. I do this by having two checking accounts. One account gets a direct deposit to cover all of my fixed expenses, the other is my regular checking account. Take your rent and other fixed expenses, if you have any, and total them. Take that total and divide by four. That's how much of each check you should be socking away in to the separate account. Additionally, with a 30% pay increase you can probably start a savings account. You should start to establish an emergency fund so this really never becomes a problem. Take 10% of your pay and put it in savings, this will still leave you with a healthy pay increase to enjoy but you'll keep some of your money for yourself too.", "title": "" }, { "docid": "125affbda803ce37568e01e5254d56ba", "text": "\"Its really, really good of you to admit your short comings with a desire to improve them. It takes courage. Keep in mind that most of us that answer questions here are really \"\"good at money\"\" so we have a hard time relating. Would you want people that are bad with money answering questions on a personal finance site? While it is intimidating you will need a budget. A budget is simply a plan for how to spend your money. Your budget, based on your new pay frequency, will likely also need some cash flow planning as a single paycheck is unlikely to cover your largest expenses. For example your rent/mortgage might be less than a single paycheck so you will have to save money from the previous paycheck to have enough money to pay it. Your best bet is to have a friend or relative that is good with money help you setup a budget. Do you have one? If not you might inquire about a church or organization that offers Financial Peace University. The teachers of the class often help people setup a budget and might be willing to do so for you. You could also take the class which will improve your money management skills. For $100 you'll have a lifetime pass to the class. If it helps you avoid three late charges/bounce checks then the class is well worth it. Now as far as spending too much money. I would recommend cash, but you have to do it the right way. Here is the process that you have to follow to be successful with cash: Doing cash will give you a more concrete example of what spending means. It won't work if you continue to hit the ATM \"\"for just $20 more\"\". It will take you a bit to get used to it, but you will be surprised how quickly you improve at managing money.\"", "title": "" }, { "docid": "961e7e8d3ce6ff1e69785437be16b1be", "text": "Unlike other responses, I am also not good with money. Actually, I understand personal finance well, but I'm not good at executing my financial life responsibly. Part is avoiding tough news, part is laziness. There are tools that can help you be better with your money. In the past, I used YNAB (You Need a Budget). (I'm not affiliated, and I'm not saying this product is better than others for OP.) Whether you use their software or not, their strategy works if you stick with it. Each time you get paid, allocate every dollar to categories where your budget tells you they need to be, prioritizing expenses, then bills, then debt reduction, then wealth building. As you spend money, mark it against those categories. Reconcile them as you spend the money. If you go over in one category (eating out for example), you have to take from another (entertainment). There's no penalties for going over, but you have to take from another category to cover it. So the trick to all of it is being honest with yourself, sticking to it, recording all expenditures, and keeping priorities straight. I used it for three months. Like many others, I saved enough the first month to pay the cost of the software. I don't remember why I stopped using it, but I wish I had not. I will start again soon.", "title": "" } ]	[ { "docid": "cdad64d50df808b8edbacef9b38b26c0", "text": "There's no reason why you couldn't have your work withhold the money for you, but you have to keep a close eye on it an file paperwork causing extra work for yourself and the payroll department. You also have that money withheld weekly instead of keeping access to the money until the end of the quarter if you paid directly to the treasury.", "title": "" }, { "docid": "b746fa726e1723cb28bd6ebb60a627b5", "text": "\"My answer has nothing to do with tax brackets or mathematics (I'm taking advantage of the leeway your question allowed), but rather it has to do with career goals and promotion. Large companies often have large \"\"Policies & Procedures\"\" booklets to go with them. One policy that sometimes exists which would make it a bad idea to accept a raise is: Employee cannot be given more than one salary increase in a 12-month period This means that if you accept a standard-of-living or merit increase of say, 2% or 3% in April, and then you apply for a job that would otherwise warrant a pay grade increase, you may be forced to wait until the following year to get bumped to the proper pay grade. Of course, this totally depends on the company, but it would be advisable to check your company's H.R. policy on that, if you're considering a move (even a lateral one) in the future.\"", "title": "" }, { "docid": "f4be7af28d70a325555d9cf7d1823b53", "text": "\"I'd forget raises, as they're hard to predict. Figure in cost of living adjustment to keep pace with inflation, and recalculate if you get a raise. I don't think about it too hard. After I deposit my expected monthly expenditures in my checking account, the balance goes to savings, so any raises will go to savings unless I specifically alter my direct deposit settings. I have to make a conscious decision to inflate my lifestyle if I want to spend that money. Also, realize that \"\"matching your income\"\" is a bit overkill. Right now, part of that income is going to savings. If you spend 60% of your income now, why would you suddenly need the extra 40% when you retire?\"", "title": "" }, { "docid": "a13a67170ffc59dbf2ae2485ac4f2bd9", "text": "I do something pretty simple when figuring 1099 income. I keep track of my income and deductible expenses on a spreadsheet. Then I do total income - total expenses * .25. I keep that amount in a savings account ready to pay taxes. Given that your estimates for the quarterly payments are low then expected, that amount should be more then enough to fully fund those payments. If you are correct, and they are low, then really what does it matter? You will have the money, in the bank, to pay what you actually owe to the IRS.", "title": "" }, { "docid": "62cc5cba2a3323bb4a679cf37648ad24", "text": "You just need to average out the weekly hours and income over the year. So if his yearly income is $100,000 p.a. then this would average out to $2000 per week of which 15% would be $300 per week. It does not have to be exactly 15% per week as long as over the long run your saving your target 15%. If he gets a pay rise you can include this in the saving plan. Say he gets a 5% increase in pay you would increase the $300 per week by 5% to $315 per week.", "title": "" }, { "docid": "0b4d610c059a02dbd92bb5fdeeabf834", "text": "\"To address the issue in the title of your question: Many expenses strike at what for all practical purposes are random intervals. Roof starts leaking, car needs repair, etc, don't have a fixed cost every month. Medical expenses can certainly be more extreme than many other expenses, but their nature is the same. And so the way to budget for them is the same: You figure out what your average expenses are over a long period of time. Then you start putting away a little more than this amount every month. Keep putting away until you have a reserve larger than any expense you are likely to get hit with all at once. I have no idea what your particular expenses are, so let me use myself for an example. My medical bills last year were unusually large: about $6,000. I have lousy insurance and a couple of chronic conditions, so my bills are usually maybe $1,000 to $2,000 per year. So I plan on about $150 per month for medical bills. Most insurance policies have an \"\"out of pocket maximum\"\". This should be the most you'd ever have to lay out in a year. Mine is $13,000. (I told you my insurance sucks.) So I have an account that I have now built up to $13,000. Worst case, I wipe out that account. In any case, if my bills are that large, the doctors or hospital will normally agree to a payment plan. (I still owe a few hundred on my bills from last year and the hospital is letting me pay it off at $120 per month.) Your question brings up a lot of issues about difficulties of working with insurance and the U.S. medical system in general. I'm not sure if your intent was to get advice on the rest of it all. Simple -- not pleasant, but simple -- answer: If you're insurance is provided by your employer, you're pretty much stuck with the policy that the employer negotiates. I don't know how much you're contributing to premiums, usually the company pays the bulk of it. You could investigate getting a policy on your own, but odds are that any policy you could get for what you're contributing now would be way worse than what you can get through the company. You could always investigate, but I doubt you'll do better. You can talk to HR. If it's a big company, they may have some muscle with the insurance company and could help you out. Failing that, it becomes a political question of how the laws affecting medical care and insurance in the U.S. are set up, and while I have many ideas for how it could be improved, sadly I'm not in a position to do much about it, and I doubt you are either. Unless you have the resources to run for president.\"", "title": "" }, { "docid": "07d2dc099d9877410a2f73be08142986", "text": "Honing in on your last question: Is there a better way? I think there is, but it would require you to change the way you handle your spending, and that may not be of interest to you. Right now you have a lot of manual work, keeping track of expenditures and then entering the, every day. The great thing about switching to a habit where you pay for everything using a debit or credit card is that you can skip the manual entry by importing your transactions from your bank. You mention that your bank doesn't allow for exporting. There's still a chance that your bank can connect with a solution like Wave Accounting (http://www.waveaccouting.com), which is free and made for small business accounting. (Full disclosure: I represent Wave.) If your current bank doesn't permit export or connections with Wave, it may be worth switching to a different bank. It's a bit of a pain to make the switch, I know, but you really will save a massive amount of time and effort over the course of the year, as well as minimize the risk of human error, compared to entering your receipts on a daily basis. In Wave, you can still enter all of your cash receipts manually if you want to continue with your current practice of cash payments. One important thing to mention, too: If you're looking for a better way of doing things, make sure it includes proper backup. There would be nothing worse than entering all that data onto a spreadsheet and then something happening to your computer and you lose it all. Wave Accounting is backed up hourly and uses bank-level security to keep your information safe. One last thing: as I mention above, Wave Accounting is free. So if it is a good match for your small business accounting needs, it will also be a nice fit for your wallet.", "title": "" }, { "docid": "a6f36feca2812f61fd959f5089dbcb7e", "text": "This is the same as any case where income is variable. How do you deal with the months where expected cash flows are lower than projected? When I got married, my wife was in the habit of allocating money to be spent in the current month from income accrued during the previous month. This is slightly complicated because we account for taxes (and benefit expenses) withheld in the current months' paychecks as current expenses, but we allocate the gross income from that check to the following month for spending. The benefit of spending only money made during the previous month is that income shocks are less shocking. I was working for a start-up and they missed payroll that normally arrived on the first of the month. Most of my co-workers were calling the bank in a panic to avoid over-draft fees with their mortgage payments, but my mortgage payment was already covered. Similarly, when the same start-up had a reduction in force on the first day of a new quarter, I didn't have to pull any money from savings during the 3 weeks I was unemployed. In the end, you're going to have to allocate money to the budget based on the actual income--which is lower than your expectations. What part of the budget should fairly be reduced is a question you and your wife will have to figure out.", "title": "" }, { "docid": "57bb8b6769fa2a80637f073875142798", "text": "You need to know loans are not free; and they are not a way to solve budget issues. If you are having problems with making your income last over your expenses, you do not need to add another expense (in the form of a loan) What you really need to do is create a budget, track and understand your expenses, and then decide if you should focus on raising your net income level or cutting down expenses. Keep up with your budget. You can reduce the frequency, but you need to track your spending really for the rest of you life. It is just a good habit, like personal hygiene. Once you understand your money (via your budget), you can start to save money into an emergency fund that will cover you during the times of zig zags. I say it very plainly as if it is super easy; but it requires will power and the foresight to understand that if you don't manage your money, nobody else will. Being sane with your money is one of the most important things you can do now to improve your future. IMPROVEMENT NathanL has an excellent first step with budgeting: Allocate money to be spent for the next month from money made during the previous month. This will build a cushion into your budget and alleviate the fear that the OP mentioned", "title": "" }, { "docid": "a67d456c3759f59fed7fa8dda13d00ee", "text": "\"Entire books have been written on how to get to the end of the month before you get to the end of the money. It's a very broad problem. But in your case, let me point out that your salary never \"\"suddenly disappears\"\" (unless you're paid in cash and it blew away or was stolen while you were sleeping.) You spent it. For a month, monitor your spending. One approach is to write everything down in a small notebook. Come up with categories like \"\"Rent\"\", \"\"Food\"\", \"\"Transportation\"\" and look at the totals. Over time, you can estimate what you spend in a normal week or month on these things. When you spend much more, you can ask yourself why. It might be because you just splurged money you didn't have on something you didn't need. It might be because something broke, and you hadn't been saving a small reserve month after month to pay for those repairs when they would be needed. It might be because some bills only come once a year or every 6 months, and you hadn't been saving a small reserve to pay that bill when it came in. Once you understand where your money is going and why it sometimes runs out, you can work out what to do about that. It might involve spending less. But that's not the first step. The first step is not to be surprised by \"\"sudden disappearances\"\" that are anything but.\"", "title": "" }, { "docid": "75019fd7b1f430fe4279514984cefb53", "text": "\"You have to be firm. Refuse to work excessive overtime. This is why I switched to consulting. 16 hour days suck, but if you're billing for 16 hours, it makes it more bearable. I've recently switched to the \"\"I only care about money\"\" mode of thinking, and switched to hourly pay after being salaried for almost 10 years. And it's not that it's the only thing that matters, but a lot of the rest of this stuff falls into place. It really simplifies things. You don't work for free. Your time is seen as a commodity. You are given goals and targets. You're not dragged into unnecessary meetings. Your opinion is respected. If you have to work saturday, you're sure as hell billing for it. If I take off at 2pm because I want to watch a hockey game, I just stop billing at 2 and there isn't this \"\"I'm not getting my money's worth!\"\" feeling from the manager.\"", "title": "" }, { "docid": "91b4ce3ca1f37ce1a0f7919d6eee4489", "text": "\"I currently use Mint for this, which I see that you have already disqualified but not why you have disqualified it. Set \"\"budgets\"\" for how much you want to spend on what type of expense, and then be sure to assign expenses to a budget as they come in. Mint actually learns what expenses go to each budget and eventually does it automatically.\"", "title": "" }, { "docid": "0f10a2dce412274f1481a39aa4a09c44", "text": "There are several reports under the Reports>Income & Expenses menu which could be useful. Cash Flow - shows, for a particular set of accounts, where incoming and outgoing money from those accounts came from and went to. Expense BarChart/PieChart - shows top N expenses. Income Statement (also called Profit & Loss) - shows all incomes and expenses for the time period. Each of these reports have an options dialog which will let you change the period that they are reporting on and the accounts to be included in the reports. The Cash Flow report sounds particularly useful for your second scenario.", "title": "" }, { "docid": "ef082fd9f0274dc21b86a1c9cf21dd9b", "text": "I think you might benefit from adopting a zero-sum budget, in which you plan where each dollar will be spent ahead of time, rather than simply track spending or worry about the next expense. Here's a pretty good article on the subject: How and Why to Use a Zero-Sum Budget. This is the philosophy behind a popular budgeting tool You Need a Budget, I am not advocating the tool, but I am a fan of the idea that a budget is less about tracking spending and more about planning spending. That said, to answer your specific question, one method for tracking your min-needed for upcoming expenses would be to record the date, expense, amount due, and amount paid as shown here: Then the formula to calculate the min-needed (entered in E1 and copied down) would be: As you populate amounts paid, the MinNeeded is adjusted for all subsequent rows. You could get fancier and only populate the MinNeeded field on dates where an expense is due using IF().", "title": "" }, { "docid": "7ba5a90e9600c4a014d4364fbc629860", "text": "Just set up a budget. Indicate how much money comes in, how much goes out to must pay expenses (lodging, food, gas, heat, cooling, etc), and determine how much is leftover for anything else you want. If that amount is ok, then you're fine. If not, something needs adjusting.", "title": "" } ]	fiqa
eec5f98e4cf570d5a6b6dcf7f7ff73d8	Thorough Description of Yield to Maturity?	[ { "docid": "36447131a937afa434b9e3fbee6ad62c", "text": "\"What is a bond price? A bond is an asset, and like any tradeable asset it has a price. If I hold $10K face value of a certain GM bond, then I would be willing to sell it at some price, which may be more or less than $10K. Whoever is willing to sell it for the lowest amount determines the price. The price is determined by the market, just as all prices are. It's what you can sell a bond for. Bond prices may be quoted in various funny ways, like as a discount or premium relative to the face value or as a premium over a treasury, but at the end it all should be converted to how much you have to pay today. In this case, it's how much you would pay today to get a set of future coupon and principal payments. What is Yield to Maturity? A bond is a contract entitling you to a certain set of predefined cash flows. If you take that set of cash flows and discount them using a single rate at all maturities such that the discounted value is equal to the price, the single rate you have identified is the YTM. Mathematically, this is the same as finding the IRR (internal rate of return) of some set of cash flows. In this case the cash flows are the coupons and principal repayment. Other bond concepts. Note that the other aspects of a bond, like maturity, coupon rate, and face value, are immutably written into the bond contract. All they do is define what payments the bond entitles the owner to. They don't say how much someone would pay today in order to be entitled to those payments. One can't know how much a future payment is worth without discounting. If you know the appropriate discount rate at every relevant maturity, you could calculate the fair price of a bond. That's the other direction. YTM looks at the market price and associated cash flows and imputes what single discount rate would make that price fair. What is YTM good for? Recall what I said about IRR above. Why would anyone want to know what discount rate equates the cash flows of a project to its cost? Because it's an easy way to summarize how profitable the project is expected to be. YTM is a quick way to summarize the yield one would get on a bond if they were to buy it today and hold to maturity. If one bond has a higher YTM than another, than heuristically we believe it pays out more and should be associated with greater risk if the market is working properly. It can be used to compare bonds or to look at how changes in bond prices are affecting expected yields. Ask yourself, how would you compare two different bonds with different maturities and coupon rates? Which one is riskier or more profitable? The simplest way to summarize this information is with the yield to maturity. YTM is used frequently enough that when you just say a bond's \"\"yield,\"\" people will assume you are talking about its yield to maturity. What is YTM not good for? One thing to be wary of is using YTM as a discount rate. It looks like a discount rate but it works for that bond and that bond only. In reality each individual coupon payment has a true discount rate, and the discount rate at each horizon is different from each other horizon. Those are true discount rates that can be applied to any cash flow of similar risk to get the right price. We can think of YTM as some kind of average of those discount rates that produces the correct price for that bond only. You should never use it for discounting something else.\"", "title": "" } ]	[ { "docid": "01a307c4236d58d3e0da1df77541e4a9", "text": "I didn't take too many finance or economics courses so i can't comment. In my post I recommended the YouTube video or audiobook 'why an economy grows and why it doesn't' I guess it's more economy related than finance related, but is still relevant as it touches on loans and net worth and stuff.", "title": "" }, { "docid": "2745009a1a49c653c34899e96bb6595f", "text": "The sum of the dividend yield plus capital growth is called total return. In your examples, you get to a total return of 7% through several different (and theoretically equivalent) paths. That is the right way of thinking.", "title": "" }, { "docid": "c9ee0e3065b8cff148fbeed83d6a7226", "text": "\"i realize the required rate will need to be below the expected growth rate. not really the issue. i'm also not looking for insight into how i model these two possible options, i'm really just interested in how people would think about producing a discount rate for the projects. \"\"but you determine the required return(discount rate) based on the perceived risk of the investment and your particular views\"\" this was the ultimate question i was getting at. what would YOU use?\"", "title": "" }, { "docid": "ccc65bbb1614f209f9f526eccf3e7119", "text": "\"The term you're looking for is yield (though it's defined the other way around from your \"\"payout efficiency\"\", as dividend / share price, which makes no substantive difference). You're simply saying that you want to buy high-yield shares, which is a common investment strategy. But you have to consider that often a high-yielding share has a reason for the high yield. You probably don't want to buy shares in a company whose current yield is 10% but will go into liquidation next year.\"", "title": "" }, { "docid": "d37d9a994626f347749725d7d6066a17", "text": "With the disclaimer that I am not a technician, I'd answer yes, it does. SPY (for clarification, an ETF that reflects the S&P 500 index) has dividends, and earnings, therefore a P/E and dividend yield. It would follow that the tools technicians use, such as moving averages, support and resistance levels also apply. Keep in mind, each and every year, one can take the S&P stocks and break them up, into quintiles or deciles based on return and show that not all stock move in unison. You can break up by industry as well which is what the SPDRs aim to do, and observe the movement of those sub-groups. But, no, not all the stocks will perform the way the index is predicted to. (Note - If a technician wishes to correct any key points here, you are welcome to add a note, hopefully, my answer was not biased)", "title": "" }, { "docid": "b5800f63f0c10a1e5baba7f2a38d43ef", "text": "From the hover text of the said screen; Latest dividend/dividend yield Latest dividend is dividend per share paid to shareholders in the most recent quarter. Dividend yield is the value of the latest dividend, multiplied by the number of times dividends are typically paid per year, divided by the stock price. So for Ambev looks like the dividend is inconsistantly paid and not paid every quarter.", "title": "" }, { "docid": "c792b0ad91138ee36099aef622b3d59c", "text": "\"The answer to almost all questions of this type is to draw a diagram. This will show you in graphical fashion the timing of all payments out and payments received. Then, if all these payments are brought to the same date and set equal to each other (using the desired rate of return), the equation to be solved is generated. In this case, taking the start of the bond's life as the point of reference, the various amounts are: Pay out = X Received = a series of 15 annual payments of $70, the first coming in 1 year. This can be brought to the reference date using the formula for the present value of an ordinary annuity. PLUS Received = A single payment of $1000, made 15 years in the future. This can be brought to the reference date using the simple interest formula. Set the pay-out equal to the present value of the payments received and solve for X I am unaware of the difference, if any, between \"\"current rate\"\" and \"\"rate to maturity\"\" Finding the rate for such a series of payments would start out the same as above, but solving the resulting equation for the interest rate would be a daunting task...\"", "title": "" }, { "docid": "977940b8e8927d4adbe295f004725948", "text": "It's difficult when you read every few sentences and a new phrase pops out. I'm not procrastinating here, I feel getting an overview of it here while I can ask specific questions about terms I don't understand will help me more than just reading it on my own. At least that's what I've found. I'm not smart and I learn better this way.", "title": "" }, { "docid": "100c16089b98c6da4bdec9e3d52ba91b", "text": "\"The raw question is as follows: \"\"You will be recommending a purposed portfolio to an investment committee (my class). The committee runs a foundation that has an asset base of $4,000,000. The foundations' dual mandates are to (a) preserve capital and (b) to fund $200,000 worth of scholarships. The foundation has a third objective, which is to grow its asset base over time.\"\" The rest of the assignment lays out the format and headings for the sections of the presentation. Thanks, by the way - it's an 8 week accelerated course and I've been out sick for two weeks. I've been trying to teach myself this stuff, including the excel calculations for the past few weeks.\"", "title": "" }, { "docid": "7819f1be16408a0aa802841cbf9596c1", "text": "\"zPesk has a great answer about dividends generally, but to answer your question specifically about yield traps, here are a few things that I look for: As with everything, if it looks too good to be true, it probably is. A 17% yield is pretty out of this world, even for a REIT. And I wouldn't bet on it holding up. Compare a company's yield to that of others in the same industry (different industries have different \"\"standards\"\" for what is considered a high or low yield) Dividends have to come from somewhere, and that somewhere is cash flow. Look at the company's financial statements. Do they have sufficient cash flow to pay the dividend? Have there been any recent changes in their cash flow situation? How are earnings holding up? Debt levels? Cash on hand? Sudden moves in stock price. A sudden drop in the stock price will cause the yield to rise. Sometimes this indicates a bargain, but if the drop is due to a real worry about the company's financial health (see #2) it's probably an indication that a dividend cut is coming. What does their dividend history look like? Do they have a consistent track record of paying out good dividends for years and years? Companies with a track record of paying dividends consistently and/or increasing their dividend regularly are likely to continue to do so.\"", "title": "" }, { "docid": "5103c63d89644a428f070da7464eb105", "text": "\"Ah ok, I can appreciate that. I'm fluent in English and Mr. Graham's command of English can be intimidating (even for me). The edition I have has commentary by Mr. Jason Zweig who effectively rewrites the chapters into simpler English and updates the data (some of the firms listed by Mr. Graham don't exist either due to bankruptcy or due to consolidation). But I digress. Let's start with the topics you took; they're all very relevant, you'd be surprised, the firm I work for require marketing for certain functions. But not being good at Marketing doesn't block you from a career in Finance. Let's look at the other subjects. You took high level Maths, as such I think a read through Harry Markowitz's \"\"Portfolio Selection\"\" would be beneficial, here's a link to the paper: https://www.math.ust.hk/~maykwok/courses/ma362/07F/markowitz_JF.pdf Investopedia also has a good summary: http://www.investopedia.com/walkthrough/fund-guide/introduction/1/modern-portfolio-theory-mpt.aspx This is Mr. Markowitz's seminal work; while it's logical to diversify your portfolio (remember the saying \"\"don't put all your eggs in one basket\"\"), Mr. Markwotiz presented the relationship of return, risk and the effects of diversification via mathematical representation. The concepts presented in this paper are taught at every introductory Finance course at University. Again a run through the actual paper might be intimidating (Lord knows I never read the paper from start to finish, but rather read text books which explained the concepts instead), so if you can find another source which explains the concepts in a way you understand, go for it. I consider this paper to be a foundation for other papers. Business economics is very important and while it may seem like it has a weak link to Finance at this stage; you have to grasp the concepts. Mr. Michael Porter's \"\"Five Forces\"\" is an excellent link between industry structure (introduced in Microeconomics) and profit potential (I work in Private Equity, and you'd be surprised how much I use this framework): https://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy There's another text I used in University which links the economic concept of utility and investment decision making; unfortunately I can't seem to remember the title. I'm asking my ex-classmates so if they respond I'll directly send you the author/title. To finish I want to give you some advice; a lot of subjects are intimidating at first, and you might feel like you're not good enough but keep at it. You're not dumber than the next guy, but nothing will come for free. I wasn't good at accounting, I risked failing my first year of University because of it, I ended up passing that year with distinction because I focused (my second highest grade was Accounting). I wasn't good in economics in High School, but it was my best grades in University. I wasn't good in financial mathematics in University but I aced it in the CFA. English is your second language, but you have to remember a lot of your peers (regardless of their command of the language) are being introduced to the new concepts just as you are. Buckle down and you'll find that none of it is impossible.\"", "title": "" }, { "docid": "ad8a6813ffead5acedb9417d1db3f382", "text": "\"I would let them get their hands dirty, learn by practicing. Below you can find a simple program to generate your own efficient frontier, just 29 lines' python. Depending on the age, adult could help in the activity but I would not make it too lecturing. With child-parent relationship, I would make it a challenge, no easy money anymore -- let-your-money work-for-you -attitude, create the efficient portfolio! If there are many children, I would do a competition over years' time-span or make many small competitions. Winner is the one whose portfolio is closest to some efficient portfolio such as lowest-variance-portfolio, I have the code to calculate things like that but it is trivial so build on the code below. Because the efficient frontier is a good way to let participants to investigate different returns and risk between assets classes like stocks, bonds and money, I would make the thing more serious. The winner could get his/her designed portfolio (to keep it fair in your budget, you could limit choices to index funds starting with 1EUR investment or to ask bottle-price-participation-fee, bring me a bottle and you are in. No money issue.). Since they probably don't have much money, I would choose free software. Have fun! Step-by-step instructions for your own Efficient Frontier Copy and run the Python script with $ python simple.py > .datSimple Plot the data with $ gnuplot -e \"\"set ylabel 'Return'; set xlabel 'Risk'; set terminal png; set output 'yourEffFrontier.png'; plot '.datSimple'\"\" or any spreadsheet program. Your first \"\"assets\"\" could well be low-risk candies and some easy-to-stale products like bananas -- but beware, notice the PS. Simple Efficient-frontier generator P.s. do not stagnate with collectibles, such as candies and toys, and retailer products, such as mangos, because they are not really good \"\"investments\"\" per se, a bit more like speculation. The retailer gets a huge percentage, for further information consult Bogleheads.org like here about collectible items.\"", "title": "" }, { "docid": "d424b29f29d724e29c526bee6f6ce5bf", "text": "The yield on Div Data is showing 20% ((3.77/Current Price)*100)) because that only accounts for last years dividend. If you look at the left column, the 52 week dividend yield is the same as google(1.6%). This is calculated taking an average of n number of years. The data is slightly off as one of those sites would have used an extra year.", "title": "" }, { "docid": "76e622fc225406dbd70fb144752364dc", "text": "\"You could use any of various financial APIs (e.g., Yahoo finance) to get prices of some reference stock and bond index funds. That would be a reasonable approximation to market performance over a given time span. As for inflation data, just googling \"\"monthly inflation data\"\" gave me two pages with numbers that seem to agree and go back to 1914. If you want to double-check their numbers you could go to the source at the BLS. As for whether any existing analysis exists, I'm not sure exactly what you mean. I don't think you need to do much analysis to show that stock returns are different over different time periods.\"", "title": "" }, { "docid": "325ef8ebd7d05c2444b8ed63b93414b1", "text": "\"Those are the \"\"right\"\" yields. They are historically (but not \"\"nonsensically\"\") low. Those yields are reflective of the sluggish U.S. and global economic activity of the past decade. If global growth were higher, the yields would be higher. The period most nearly comparable to the past 10 years in U.S. and world history was the depressed 1930s. (I am the author of this 2004 book that predicted a stock market crash (which occurred in 2008), and the modern 1930s, but I was wrong in my assumption that the modern 1930s would involve another depression rather than 'slow growth.')\"", "title": "" } ]	fiqa
9ea06e7047581dd10d3efe516eaa639c	Payment default penalties on annuities	[ { "docid": "c175f3104fa1622c371c24f1617c3804", "text": "\"I don't know how annuities work it's all smoke and mirrors to me. This is a huge red flag to me. I would ask the agent what the penalty is to cancel this contract, and see ho much you can get back. If done right, you should be able to transfer these funds to an IRA or other pretax account. To be clear, I'd make a similar remark if you said your were in a S&P ETF or any investment you don't understand. \"\"Appropriate investment\"\" means little if the investor has no understanding of what they are buying. Update in repose to comments -\"", "title": "" } ]	[ { "docid": "5f35fa4afca319ddd8836b4f8c4f4df1", "text": "\"I think you want to look at companies that buy annuities and give you a lump sum. They exist to do this for lawsuit payments, lottery winnings, etc. I'm not sure what the fees would be on a relatively small payout of $6K but try searching for \"\"converting annuity to cash\"\" and the first several hits were all firms looking to buy structured payment settlements for a lump sum. They make their money by paying less than the present-day value of the annuity, so you will get less money this way than collecting your payments slowly.\"", "title": "" }, { "docid": "c883abf8ed36a71a6c5a99486ff7e32f", "text": "\"Be very careful about terminology when talking about annuities. You used the phrase \"\"4% return\"\" in your question. What exactly do you mean by that? An annuity that pays out 4% of its principle is not giving you a \"\"4% return\"\" in the sense of ROI, because most of that was your money to begin with. But to achieve a true 4% return in the current environment where interest rates are at historic lows on anything safe (10 year UK Gilts at 0.91%) would make me very nervous about what the insurance company is investing my annuity in.\"", "title": "" }, { "docid": "ac752fb104fc90705e42850f151aec14", "text": "What I'm going to write is far too long for a comment, so I'll put it here even though its not an answer. That's the closest thing to an answer you'll get here, I'm afraid. I'm not a tax professional, and you cannot rely on anything I say, as you undoubtedly know. But I'll give you some pointers. Things you should be researching when you have international clients: Check if Sec. 402 can apply to the pension funds, if so your life may become much easier. If not, and you have no idea what you're doing - consider referring the client elsewhere. You can end up with quite a liability suit if you make a mistake here, because the penalties on not filing the right piece of paper are enormous.", "title": "" }, { "docid": "360448724a2cebca4bbfeff2001f9da6", "text": "The principal of the contribution can definitely be withdrawn tax-free and penalty-free. However, there is a section that makes me think that the earnings part may be subject to penalty in addition to tax. In Publication 590-A, under Traditional IRAs -> When Can You Withdraw or Use Assets? -> Contributions Returned Before Due Date of Return -> Early Distributions Tax, it says: The 10% additional tax on distributions made before you reach age 59½ does not apply to these tax-free withdrawals of your contributions. However, the distribution of interest or other income must be reported on Form 5329 and, unless the distribution qualifies as an exception to the age 59½ rule, it will be subject to this tax. This section is only specifically about the return of contributions before the due date of return, not a general withdrawal (as you can see from the first sentence that the penalty doesn't apply to contributions, which wouldn't be true of general withdrawals). Therefore, the second sentence must be about the earnings part of the withdrawal that you must make together with the contribution part as part of the return of contributions before the due date of the return. If the penalty it is talking about is only about other types of withdrawals and doesn't apply to the earnings part of the return of contribution before the due date of the return, then this sentence wouldn't make sense as it's in a part that's only about return of contribution before the due date of the return.", "title": "" }, { "docid": "52492852287011fbe018664819ecfe84", "text": "This isn't new. In the mid 80s rules were established by the IRS to differentiate life insurance from Modified Endowment Contracts, placing upper limits on how much money could be placed in life insurance accounts relative to the coverage provided and how quickly (fastest a policy can become paid-in-full is 7 years). None of this closes the fundamental loophole, but it exists for a reason, taxation of life insurance is probably unwise and would result in less people using life insurance as a risk mitigation technique, despite the fact that it's very appropriate for that in some situations. The problem here is that once you get out of everyday-people numbers and into very large sums the vehicle can be clearly abused to avoid taxes on investment gains while living, and possibly avoid them altogether depending on how the estate is structured, and this is bad for the average person who'd like the megarich to pay their percent towards the public needs the same way the average guy does.", "title": "" }, { "docid": "9d88f6fdb8aa78d44ba0c29ba259aa4e", "text": "Make sure you do not buy a variable annuity look for immediate annuity. Clark Howard has an article Why Variable Annuities Stink Variable annuities Right now, the 15 largest insurance sellers of variable annuities are being asked to reveal the expensive perks they offer to salespeople who meet quotas for pushing this junk. Those perks include free cars, vacations, jewelry, cash, etc. Immediate Annuities Immediate payout annuities are entirely legitimate, but they have so little in the way of commissions that they're never pushed by salespeople.", "title": "" }, { "docid": "6969753a024f1de9d19ab6694a06b200", "text": "The penalty for excess contributions is 6 percent. The 6 percent is assessed on the amount of the overage. This penalty is an excise tax. If you remove the excess amount prior to the end of the tax year, you will not be assessed a penalty on the excess contribution amount. Above is from http://beginnersinvest.about.com/od/401k/a/401k-Penalties-To-Avoid.htm", "title": "" }, { "docid": "3af05dd9d29355cadf518acbb6fcddde", "text": "IANAL, but it sounds like indemnification language. They are saying they have the option to charge expenses to participants if they would like. It should say explicitly (you mention that it does) who the 'default payer' is. Unexpected expenses could be anything that's not in the normal course of business. I know that doesn't help much, but some examples may be plan document restatements or admin expenses from plan failures/corrections. We have language in some of our PFDs that say in the absence of revenue-sharing a participants' share of expenses may be higher. Yes, 'from participant accounts' means they have the authority to deduct from your 401k account.", "title": "" }, { "docid": "fa459e98c8cdb890395baf5afa2ea0de", "text": "The way the question is worded, it is slightly opinion based. Just to point out; Tax benefits - Upto 50000 INR is tax free when invested here. This is actually 200,000 INR under 80C. So if you invest max of 150,000 in other instruments in 80C; you can still invest 50,000 into NPS. Hopefully it will provide some lumpsum money that I could probably use to buy a house / kid's education / kid's marriage. There are very few withdrawal options. Generally in the current scenario; By the time you retire; you would already have house, kid would have got married. Answers given the current data is it a worthwhile investment? It is a good investment option available. It is up to individual to select this or invest else where. If yes, would be better to fix choice at 50% in E and 25% in C and E or go for the auto choice? As you are young it is better to have max 50% in Equity and actively monitor this and change the percentage as you near the retirement age. If you don't have time, or are not financial savy, or one is plain simple lazy; going with Auto choice makes sense. bad investment because if you put the same money into equity oriented mutual funds then you will get better returns ... This depends. If you are currently investing everything into Equity; then yes at absolute level, the returns are high. However if you are investing into Equity and debt to achieve a balance, then NPS is doing it automatically for you. As the NPS has very low costs, there is substantial advantage. In some years [2013-2014?] the NPS equity return has been excellent and exceeded leading mutual funds. Other Aspect Edits: The Annuities need to invest in guaranteed risk free instruments; generally bonds. As the rates are locked for life, they need to factor things like average life expectancy, demographics, etc. This is largely statistical. Similar to how the Insurance premiums are decided. This is adjusted periodically. Say they offer 6.5% for 100 people. The investments into bonds is yielding only 6%. Then for next 100 people, they would offer 5.5%. However if the mortality increases, i.e. 50 people die at age of 70, they just need to adjust it to 5.75% for next 100 ... so there are quite a few parameters that go in and statical models output what the rate should be offered. At times the corpus manager may take a hedge to minimize downside. This is a specialized subject and there no dummies that show how rates are determined. It is also a trade secret.", "title": "" }, { "docid": "369177f0e1f04032be7cb97127ab23d5", "text": "This sounds a lot like an Equity-indexed Annuity. They date from about 1996 (there is a bit of skepticism about them, as they are tricky to understand for the typical investor). For instance, an equity indexed annuity pays a portion of the gain in an index (like S&P 500) when the stock market rises, and guarantees you won't lose if it falls. In an arbitrage sense, it is roughly equivalent to buying a mixture of bonds and index (call) options. There are a lot of complicated 'tweaks' on these, such as annual ratchet/annual reset, interest caps, etc. There is quite a bit of debate about whether they are too good to be true, so I'd read a few articles with pros and cons before buying one. These are also commonly called FIA (Fixed indexed annuities).", "title": "" }, { "docid": "359d3c194143a1f84f2c482a5df6ebdc", "text": "\"There is no formula to answer the question. You have to balance return on investment with risk. There's also the question of whether you have any children or other heirs that you would like to leave money to. The mortgage is presumably a guaranteed thing: you know exactly how much the payments will be for the rest of the loan. I think most annuities have a fixed rate of return, but they terminate when you both die. There are annuities with a variable return, but usually with a guaranteed minimum. So if you got an annuity with a fixed 3.85% return, and you lived exactly 18 more years, then (ignoring tax implications), there'd be no practical difference between the two choices. If you lived longer than 18 years, the annuity would be better. If less, paying off the mortgage would be better. Another option to consider is doing neither, but keeping the money in the 401k or some other investment. This will usually give better than 3.85% return, and the principal will be available to leave to your heirs. The big drawback to this is risk: investments in the stock market and the like usually do better than 3 or 4%, but not always, and sometimes they lose money. Earlier I said \"\"ignoring tax implications\"\". Of course that can be a significant factor. Mortgages get special tax treatment, so the effective interest rate on a mortgage is less than the nominal rate. 401ks also get special tax treatment. So this complicates up calculations trying to compare. I can't give definitive numbers without knowing the returns you might get on an annuity and your tax situation.\"", "title": "" }, { "docid": "cda7eea9124be207c47508a4ae82b316", "text": "\"we can then start taking penalty free withdrawals from it? There's no \"\"we\"\" in IRA. There's \"\"I\"\". That stands for \"\"Individual\"\". So your wife's age has no influence whatsoever on your ability to make qualified distributions from your IRA. The reason courts order distributions from IRAs is due to the community property laws of various States or other considerations that make spouses entitled to the amounts in the IRAs. However, you're talking about family law here, not tax law. For Federal tax purposes, a distribution ordered by the court doesn't trigger penalty (but is taxable), but any other distribution has to follow the regular qualification criteria.\"", "title": "" }, { "docid": "5d59a80cbc6303934bc2c968a57e0e8c", "text": "IANAL but I'd think common sense would say that if you take advantage of one of the special cases that allow you to withdraw from a retirement plan without penalty, and then for whatever reason you don't use the money for a legal purpose, you would have to either return the money or pay the tax penalty. And I'll go out on a limb here without any documentation and guess that if you lie to the IRS and say that you withdrew the money for an exempt purpose and instead use it to go on vacation and you get caught, that you will not only have to pay the tax penalty but will also be liable for criminal charges of tax fraud. If the law and/or IRS regulations say that the only legal exceptions are A, B, and C, that pretty clearly means that if you do D, you are breaking the law. And in the eyes of the government, failing to pay the taxes you owe is way worse than robbery, murder, or rape.", "title": "" }, { "docid": "05c4fab0e8d3da81f656182506986df5", "text": "I work for a mortgage company but one that sells the loans we fund to banks. I've never heard of that risk mitigation incentive (lower rate for auto payments) but I know for a fact you will have a higher interest rate if you choose to pay your taxes and insurance out of your own pocket and not escrow them. I would contact the CFPB instead of an attorney and they will be able to tell you very quickly whether this is an acceptable practice or not.", "title": "" }, { "docid": "784068b2247fdc0104dae050e8a2cf51", "text": "\"The instructions do specifically mention them, but not as exclusive plans. Pension and annuity payments include distributions from 401(k), 403(b), and governmental 457(b) plans. The instructions also mention this: An eligible retirement plan is a governmental plan that is a qualified trust or a section 403(a), 403(b), or 457(b) plan. 414(h) plans are \"\"qualified\"\" plans. Employee contribution to a 414(h) plan is qualified under 403(b). Report it there and mark it as \"\"Rollover\"\". Talk to a licensed (EA/CPA licensed in your state) professional when in doubt.\"", "title": "" } ]	fiqa
1d56657c31c15ebcdf4ef40f54e06fd0	Investment for young expatriate professionals	[ { "docid": "74b29da71765c7cbe5d01f3f964e4834", "text": "That's a broad question, but I can throw some thoughts at you from personal experience. I'm actually an Australian who has worked in a couple of companies but across multiple countries and I've found out first hand that you have a wealth of opportunities that other people don't have, but you also have a lot of problems that other people won't have. First up, asset classes. Real estate is a popular asset class, but unless you plan on being in each of these countries for a minimum of one to two years, it would be seriously risky to invest in rental residential or commercial real estate. This is because it takes a long time to figure out each country's particular set of laws around real estate, plus it will take a long time to get credit from the local bank institutions and to understand the local markets well enough to select a good location. This leaves you with the classics of stocks and bonds. You can buy stocks and bonds in any country typically. So you could have some stocks in a German company, a bond fund in France and maybe a mutual fund in Japan. This makes for interesting diversification, so if one country tanks, you can potentially be hedged in another. You also get to both benefit and be punished by foreign exchange movements. You might have made a killing on that stock you bought in Tokyo, but it turns out the Yen just fell by 15%. Doh. And to top this off, you are almost certainly going to end up filling out tax returns in each country you have made money in. This can get horribly complicated, very quickly. As a person who has been dealing with the US tax system, I can tell you that this is painful and the US in particular tries to get a cut of your worldwide income. That said, keep in mind each country has different tax rates, so you could potentially benefit from that as well. My advice? Choose one country you suspect you'll spend most of your life in and keep most of your assets there. Make a few purchases in other places, but minimize it. Ultimately most ex-pats move back to their country of origin as friends, family and shared culture bring them home.", "title": "" } ]	[ { "docid": "7e566e393adc86375f0841c7c775c055", "text": "You assume that you'll be working at a bulge bracket, who have structured programs and are used to hiring globally. If you go work at a hedge fund, it could end up being a small shop who would rather not deal with any additional issues. On my campus - many companies don't hire international just because there are so many qualified domestic applicants. This is probably the most competitive and lucrative field out of any profession.", "title": "" }, { "docid": "c517ef7ba52c41d23492de2239036a19", "text": "Investing in property hoping that it will gain value is usually foolish; real estate increases about 3% a year in the long run. Investing in property to rent is labor-intensive; you have to deal with tenants, and also have to take care of repairs. It's essentially getting a second job. I don't know what the word pension implies in Europe; in America, it's an employer-funded retirement plan separate from personally funded retirement. I'd invest in personally funded retirement well before buying real estate to rent, and diversify my money in that retirement plan widely if I was within 10-20 years of retirement.", "title": "" }, { "docid": "4d9f05f39288a85e40d0d2571f7e15c5", "text": "\"You are in your mid 30's and have 250,000 to put aside for investments- that is a fantastic position to be in. First, let's evaluate all the options you listed. Option 1 I could buy two studio apartments in the center of a European capital city and rent out one apartment on short-term rental and live in the other. Occasionally I could Airbnb the apartment I live in to allow me to travel more (one of my life goals). To say \"\"European capital city\"\" is such a massive generalization, I would disregard this point based on that alone. Athens is a European capital city and so is Berlin but they have very different economies at this point. Let's put that aside for now. You have to beware of the following costs when using property as an investment (this list is non-exhaustive): The positive: you have someone paying the mortgage or allowing you to recoup what you paid for the apartment. But can you guarantee an ROI of 10-15% ? Far from it. If investing in real estate yielded guaranteed results, everyone would do it. This is where we go back to my initial point about \"\"European capital city\"\" being a massive generalization. Option 2 Take a loan at very low interest rate (probably 2-2.5% fixed for 15 years) and buy something a little nicer and bigger. This would be incase I decide to have a family in say, 5 years time. I would need to service the loan at up to EUR 800 / USD 1100 per month. If your life plan is taking you down the path of having a family and needed the larger space for your family, then you need the space to live in and you shouldn't be looking at it as an investment that will give you at least 10% returns. Buying property you intend to live in is as much a life choice as it is an investment. You will treat the property much different from the way something you rent out gets treated. It means you'll be in a better position when you decide to sell but don't go in to this because you think a return is guaranteed. Do it if you think it is what you need to achieve your life goals. Option 3 Buy bonds and shares. But I haven't the faintest idea about how to do that and/or manage a portfolio. If I was to go down that route how do I proceed with some confidence I won't lose all the money? Let's say you are 35 years old. The general rule is that 100 minus your age is what you should put in to equities and the rest in something more conservative. Consider this: This strategy is long term and the finer details are beyond the scope of an answer like this. You have quite some money to invest so you would get preferential treatment at many financial institutions. I want to address your point of having a goal of 10-15% return. Since you mentioned Europe, take a look at this chart for FTSE 100 (one of the more prominent indexes in Europe). You can do the math- the return is no where close to your goals. My objective in mentioning this: your goals might warrant going to much riskier markets (emerging markets). Again, it is beyond the scope of this answer.\"", "title": "" }, { "docid": "05f4925f5d8fd3d6ddd0d008ab149723", "text": "The partition is more or less ok, the specific products are questionable. Partition. It's usually advised to keep 2-3 monthly income liquid. In your case, 40-45 kEUR is ca. 24-27 kEUR netto, i.e. 2000-2250 a month, thus, the range is 4-7 kEUR, as you are strongly risk-averse then 7k is still ok. Then they propose you to invest 60% in low-risk, but illiquid and 15% in middle or high risk which is also ok. However, it doesn't have to be real estate, but could be. Specifics. Be aware that a lot (most?) of the banks (including local banks, they are, however, less aggressive) often sell the products that promise high commissions to them (often with a part flowing directly to your client advisor). Especially now, when the interest rates are low, they stand under extra pressure. You should rather switch to passively managed funds with low fees. If you stick up to the actively managed funds with their fees, you should choose them yourself.", "title": "" }, { "docid": "f954722876bfa4acb9331c336341e5db", "text": "As other answers have pointed out, professional real estate investors do own residential investment properties. However, small residential units typically are not owned by professional real estate investors as your experience confirms. This has a fairly natural cause. The size of the investment opportunity is insufficient to warrant the proper research/due diligence to which a large investment firm would have to commit if it wanted to properly assess the potential of a property. For a small real estate fund managing, say, $50 MM, it would take 100 properties at a $500K valuation in order to fully invest the funds. This number grows quickly as we decrease the average valuation to reflect even smaller individual units. Analogously, it is unlikely that you will find large institutional investors buying stocks with market caps of $20 MM. They simply cannot invest a large enough portion of total AUM to make the diligence make economic sense. As such, institutional real estate money tends to find its way into large multi-family units that provide a more convenient purchase size for a fund.", "title": "" }, { "docid": "48a6bf9cf171d813361886f74c92a6f9", "text": "I think you're on the right track. Keep it up. You are still relatively young, and it wont have an impact. You have experience and you have a lot of education, both will be assets. I can't comment on the region question because I have only ever worked in one region. Are you asking from a purely economics/getting paid perspective? One approach you can take is making a little spreadsheet with average trader salary divided by cost of living in that region. The issue is that trader salaries and bonuses vary SO MUCH in every region, that you can't make any generalizations.", "title": "" }, { "docid": "a476ec0ff7404c38d0527ce76e7aa04b", "text": "Since you said you're young, consider learning more and getting involved in financial engineering. You need a VERY strong quant background and good knowledge of coding C++, but there is a lot of money to be had. Check out Berkeley's program. http://mfe.berkeley.edu/", "title": "" }, { "docid": "a65594a18d3dd998b566955e0836c790", "text": "If you're sure you want to go the high risk route: You could consider hot stocks or even bonds for companies/countries with lower credit ratings and higher risk. I think an underrated cost of investing is the tax penalties that you pay when you win if you aren't using a tax advantaged account. For your speculating account, you might want to open a self-directed IRA so that you can get access to more of the high risk options that you crave without the tax liability if any of those have a big payout. You want your high-growth money to be in a Roth, because it would be a shame to strike it rich while you're young and then have to pay taxes on it when you're older. If you choose not to make these investments in a tax-advantaged account, try to hold your stocks for a year so you only get taxed at capital gains rates instead of as ordinary income. If you choose to work for a startup, buy your stock options as they vest so that if the company goes public or sells privately, you will have owned those stocks long enough to qualify for capital gains. If you want my actual advice about what I think you should do: I would increase your 401k percentage to at least 10% with or without a match, and keep that in low cost index funds while you're young, but moving some of those investments over to bonds as you get closer to retirement and your risk tolerance declines. Assuming you're not in the 25% tax bracket, all of your money should be in a Roth 401k or IRA because you can withdraw it without being taxed when you retire. The more money you put into those accounts now while you are young, the more time it all has to grow. The real risk of chasing the high-risk returns is that when you bet wrong it will set you back far enough that you will lose the advantage that comes from investing the money while you're young. You're going to have up and down years with your self-selected investments, why not just keep plugging money into the S&P which has its ups and downs, but has always trended up over time?", "title": "" }, { "docid": "b01b8a39d9dcd8a1f2f491f032e31143", "text": "I’m not an expert on the VISA/US tax or insurance, but you're making enough mistakes in terms of all the associated costs involved in owning and renting houses/apartments that this already looks potentially unwise at this stage of your investment career. Renting cheap properties/to students involves the property constantly being trashed, often being empty and requiring extremely close management (which you either have to pay someone a lot to do, or do yourself and lose other potential earning time. If doing yourself you will also make lots of mistakes in the vetting/managing/marketing process etc at first as this is a complex art in itself). Costs on this type of rental can often get as high as 25% a year depending exactly how lucky you get even if you do it all yourself, and will typically be in the 5-15% range every year once everything you have to constantly maintain, replace and redecorate is totalled up. That's all pre what you could be earning in a job etc, so if you could earn a decent clip elsewhere in the same time also have to deduct that lost potential. Send it all to third parties (so all upkeep by hired contractors, all renting by an agency) you will be lucky to even break even off ~15k a year per property rents to students. You’re not seeming to price in any transaction costs, which usually run at ~5% a time for both entrance and exit. Thats between half and one years rent gone from the ten per property on these numbers. Sell before ten is up its even more. On point three, rounding projections in house price rises to one decimal place is total gibberish – no one who actually has experience investing their own money well ever makes or relies on claims like this. No idea on Pittsburgh market but sound projections of likely asset changes is always a ranged and imprecise figure that cannot (and shouldn’t) be counted on for much. Even if it was, it’s also completely unattainable in property because you have to spend so much money on upkeep: post costs and changes in size/standard, house values generally roughly track inflation. Have a look at this chart and play around with some reasonable yearly upkeep numbers and you will see what I mean. Renting property is an absolute graveyard for inexperienced investors and if you don't know the stuff above already (and it's less than 10% of what you need to know to do this profitably vs other uses of your time), you will nearly always be better off investing the money in more passive investments like diversified bonds, REITs and Stock.", "title": "" }, { "docid": "dc27884db05e9293f90b59df81f38156", "text": "At your young age, the most of your wealth is your future labor income (unless you are already rich). Your most profitable investment at this time is most likely to be investment in your human capital (your professional skills, career opportunities). Depending on how you plan to earn your money, invest time and effort to enable you to earn better wages in that activity. So focus on education or professional training. Also, consider that it is probably your total lifetime utility/welfare you should maximize (but you decide!). I suggest you do not focus narrowly on earning as much money as possible. Consider what sort of life you want and what you need to do to enable it. Best of luck!", "title": "" }, { "docid": "57a8790fe6738fd8ce55d4f0baeaa10f", "text": "Your gut feeling is absolutely spot on - you shouldn't be worrying about pension now, not at the age of 25. Assuming that you're not a footballer in the middle of the most productive part of your career and already have a fat wad of crunchy banknotes under your pillow that you're looking to set aside for a rainy day when you won't be able to play at your prime any longer. That doesn't mean you shouldn't invest, nor that means that you mustn't save. There are several factors at play here. First of all as a young person you are likely to have a high tolerance for risk, there is still plenty of time to recover should expected returns not materialise. Even a pension fund with the most aggressive risk / return strategy might just not quite do it for you. You could invest into education instead, improve health, obtain a profitable skill, create social capital by building connections, pay for experience, buy a house, start a family or even a business. Next, as a young professional you're unlikely to have reached your full earning potential yet and due to the law of diminishing marginal utility a hundred pounds per month now have greater utility (i.e. positive impact on your lifestyle) than a seven hundred pounds will in 7-10 years time once your earnings plateaued. That is to say it's easier to save £700 month from £3000 and maintain a reasonable level of personal comfort than carve £100 from £1300 monthly income. And last, but not the least, lets face it from a human point of view - forty years is a very long investment horizon and many things might and will change. One of the downsides of UK pensions is that you have very little control over the money until you reach a certain age. Tactically I suggest saving up to build a cushion consisting of cash or near cash assets; the size of the stash should be such that it is enough to cover all of your expenses from a minimum of 2 months to a maximum of a year. The exact size will depend on your personal comfort level, whatever social net you have (parents, wife, partner) and how hard it will be to find a new source of income should the current cease to produce cash. On a strategic level you can start looking into investing any surplus cash into the foundation of what will bring joy and happiness into the next 40 years of your life. Your or your partners training and education is one of the most sensible choices whilst you're young. Starting a family is another one. Both might help you reach you full earning potential much quicker. Finding what you love to do and learning how to do it really well - cash can accelerate this process bringing you quicker there you want to be. If you were a start-up business in front of a huge uncaptured market would you rather use cash to pay dividends or finance growth?", "title": "" }, { "docid": "2343c02755c49de7b8008466b7274762", "text": "You don't need a visa to invest in US equity. You don't need a visa to profit from US equity. There may be other legal considerations, but they aren't visa related, hope that helps", "title": "" }, { "docid": "40f4b295402b38de190ba9198138eea9", "text": "\"Currency, like gold and other commodities, isn't really much of an investment at all. It doesn't actually generate any return. Its value might fluctuate at a different rate than that of the US dollar or Euro, but that's about it. It might have a place as a very small slice of a basket of global currencies, but most US / European households don't actually need that sort of basket; it's really more of a risk-management strategy than an investment strategy and it doesn't really reflect the risks faced by an ordinary family in the US (or Europe or similar). Investments shouldn't generally be particularly \"\"exciting\"\". Generally, \"\"exciting\"\" opportunities mean that you're speculating on the market, not really investing in it. If you have a few thousand dollars you don't need and don't mind losing, you can make some good money speculating some of the time, but you can also just lose it all too. (Maybe there's a little room for excitement if you find amazing deals on ordinary investments at the very bottom of a stock market crash when decent, solid companies are on sale much cheaper than they ordinarily are.)\"", "title": "" }, { "docid": "4ed57c04ebace079b2c46549a314472d", "text": "There are many reasons but perhaps the most telling is that these small foreign companies usually have not experienced diminishing marginal returns. This means they grow faster, which means higher returns for investment. However a lack of infrastructure, and of political and economic stability, make these investments risky!", "title": "" }, { "docid": "759e601171450b86a2054b66acd393e7", "text": "\"I will add another point to ChrisinEdmonton's answer... I recognize that this is perhaps appropriate as a comment--or maybe 1/2 of an answer, but the comment formatting is inadequate for what I want to say. The magic formula that you need to understand is this: (Capital Invested) * (Rate of Return) = (Income per Period) When ChrisinEdmonton says that you need $300,000, he is doing some basic algebra... (Capital Required) = (Income per Period) / (Rate of Return) So if you're looking at $12,000 per year in passive income as a goal, and you can find a \"\"safe\"\" 4% yield, then what ChrisinEdmonton did is: $12,000 / 0.04 = $300,000 You can use this to play around with different rates of return and see what investment options you can find to purchase. Investment categories like REITs will risk your principal a little more, but have some of the highest dividend yields of around 8%--12%. You would need $100,000--$150,000 at those yields. Some of the safest approaches would be bonds or industrial stocks that pay dividends. Bonds exist around 3%--4%, and industrial dividend stocks (think GE or UTX or Coca Cola) tend to pay more like 2%-3%. The key point I'm trying to make is that if you're looking for this type of passive income, I recommend that you don't plan on the income coming from gains to the investment... This was something that ChrisinEdmonton wasn't entirely clear about. It can be complicated and expensive to whittle away at a portfolio and spend it along the way.\"", "title": "" } ]	fiqa
d31993688cfe54e43bef64cdc1aab70f	mortgage vs car loan vs invest extra cash?	[ { "docid": "789946a2afdaed089285d40011b9daec", "text": "Pay off your car loan. Here is why: As you mentioned, the interest on your home mortgage is tax deductible. This may not completely offset the difference in interest between your two loans, but it makes them much closer. Once your car debt is gone, you have eliminated a payment from your life. Now, here's the trick: take the money that you had been paying on your car debt, and set it aside for your next car. When the time comes to replace your car, you'll be able to pay cash for your car, which has several advantages.", "title": "" }, { "docid": "593cbd452c7286b4358b8973a7511d16", "text": "\"First off, the \"\"mortgage interest is tax deductible\"\" argument is a red herring. What \"\"tax deductible\"\" sounds like it means is \"\"if I pay $100 on X, I can pay $100 less on my taxes\"\". If that were true, you're still not saving any money overall, so it doesn't help you any in the immediate term, and it's actually a bad idea long-term because that mortgage interest compounds, but you don't pay compound interest on taxes. But that's not what it actually means. What it actually means is that you can deduct some percentage of that $100, (usually not all of it,) from your gross income, (not from the final amount of tax you pay,) which reduces your top-line \"\"income subject to taxation.\"\" Unless you're just barely over the line of a tax bracket, spending money on something \"\"tax deductible\"\" is rarely a net gain. Having gotten that out of the way, pay down the mortgage first. It's a very simple matter of numbers: Anything you pay on a long-term debt is money you would have paid anyway, but it eliminates interest on that payment (and all compoundings thereof) from the equation for the entire duration of the loan. So--ignoring for the moment the possibility of extreme situations like default and bank failure--you can consider it to be essentially a guaranteed, risk-free investment that will pay you dividends equal to the rate of interest on the loan, for the entire duration of the loan. The mortgage is 3.9%, presumably for 30 years. The car loan is 1.9% for a lot less than that. Not sure how long; let's just pull a number out of a hat and say \"\"5 years.\"\" If you were given the option to invest at a guaranteed 3.9% for 30 years, or a guaranteed 1.9% for 5 years, which would you choose? It's a no-brainer when you look at it that way.\"", "title": "" }, { "docid": "039cc579a85a6ad914607b922112d2e7", "text": "A point that hasn't been mentioned is whether paying down the mortgage sooner will get you out of unnecessary additional costs, such as PMI or a lender's requirement that you carry flood insurance on the outstanding mortgage balance, rather than the actual value/replacement cost of the structures. (My personal bugbear: house worth about $100K, while the bare land could be sold for about twice that, so I'm paying about 50% extra for flood insurance.) May not apply to your loan-from-parents situation, but in the general case it should be considered. FWIW, in your situation I'd probably invest the money.", "title": "" }, { "docid": "78a94d092a6d237689bddc2eb43e0aee", "text": "Without knowing actual numbers it's tough to say. Personally, I would pay off the car then, going forward, use the money that would have been paid on your car note toward your mortgage. I always think of things in the worst possible scenario. It's easier, and faster, to repossess a car than to foreclose on real estate. Also, in an emergency situation, depleting your fund for your car loan and your mortgage would be significantly more detrimental than only paying a mortgage with a car owned outright. Fewer obligations means fewer things to draw down your funds in an emergency. Whether the tax deductability of the mortgage interest outweighs the lower rate on your car loan will depend on a lot of factors that haven't been shared. I think it's safe to assume with only 1% of separation the real difference isn't significant. I think when determining which credit cards to pay off, choosing the one with the highest rate is smart. But that's not the situation you're in. If you don't have foreclosure concerns I'd still pay off the car then start investing.", "title": "" }, { "docid": "eb1921209412666e7f31f6fd05338c33", "text": "Since you've already maxed out your 401k and your IRA, if you wanted to invest more-- then it would either be in a brokerage account or a 529 (if you have kids/ intend on going back to school). As to investing versus paying off your loans -- the interest on them are small enough that it will depend on your preference. If you need the cash flow for investment purposes (ie if you are going to buy an investment property) then I would pay off the car loan first -- otherwise I would invest the money. Since you've already expressed that you wouldn't be too interested in paying the mortgage off early, I've left that off the table (I would prioritize car loan over mortgage for the cash flow reason) If you do open a brokerage account -- make sure you are minimizing your taxes by putting the 'right' type of assets in a tax advantaged account.", "title": "" }, { "docid": "b2f2dc9071e084e677614bd296b2ff87", "text": "It depends on your tax rate. Multiply your marginal rate (including state, if applicable) by your 3.1% to figure out how much you are saving through the deduction, then subtract that from the 3.1% to get the effective rate on the mortgage. For example, if you are in the 28% bracket with no state tax impact from the mortgage, your effective rate on the mortgage is 2.232%. This also assumes you'd still itemize deductions without the mortgage, otherwise, the effective deduction is less. Others have pointed out more behavioral reasons for wanting to pay off the car first, but from a purely financial impact, this is the way to analyze it. This is also your risk-free rate to compare additional investing to (after taking into account taxes on investments).", "title": "" } ]	[ { "docid": "374f98708af43b789ea27528fbcb43e0", "text": "\"I think the risk involved with the \"\"fund gaining a larger rate of return\"\" is probably priced in. Why would the bank take the risk on you with a car loan when it could put it in the same fund you're talking about and make more money?\"", "title": "" }, { "docid": "f2d1c0c043e6c0d127ce9c0d8d2b9b31", "text": "Any way you look at it, this is a terrible idea. Cars lose value. They are a disposable item that gets used up. The more expensive the car, the more value they lose. If you spend $100,000 on a new car, in four years it will be worth less than $50,000.* That is a lot of money to lose in four years. In addition to the loss of value, you will need to buy insurance, which, for a $100,000 car, is incredible. If your heart is set on this kind of car, you should definitely save up the cash and wait to buy the car. Do not get a loan. Here is why: Your plan has you saving $1,300 a month ($16,000 a year) for 6.5 years before you will be able to buy this car. That is a lot of money for a long range goal. If you faithfully save this money that long, and at the end of the 6.5 years you still want this car, it is your money to spend as you want. You will have had a long time to reconsider your course of action, but you will have sacrificed for a long time, and you will have the money to lose. However, you may find out a year into this process that you are spending too much money saving for this car, and reconsider. If, instead, you take out a loan for this car, then by the time you decide the car was too much of a stretch financially, it will be too late. You will be upside down on the loan, and it will cost you thousands to sell the car. So go ahead and start saving. If you haven't given up before you reach your goal, you may find that in 6.5 years when it is time to write that check, you will look back at the sacrifices you have made and decide that you don't want to simply blow that money on a car. Consider a different goal. If you invest this $1300 a month and achieve 8% growth, you will be a millionaire in 23 years. * You don't need to take my word for it. Look at the car you are interested in, go to kbb.com, select the 2012 version of the car, and look up the private sale value. You'll most likely see a price that is about half of what a new one costs.", "title": "" }, { "docid": "f87226ad36fb57cd8b9f6f94267f6536", "text": "I would say that, for the most part, money should not be invested in the stock market or real estate. Mostly this money should be kept in savings: I feel like your emergency fund is light. You do not indicate what your expenses are per month, but unless you can live off of 1K/month, that is pretty low. I would bump that to about 15K, but that really depends upon your expenses. You may want to go higher when you consider your real estate investments. What happens if a water heater needs replacement? (41K left) EDIT: As stated you could reduce your expenses, in an emergency, to 2K. At the bare minimum your emergency fund should be 12K. I'd still be likely to have more as you don't have any money in sinking funds or designated savings and the real estate leaves you a bit exposed. In your shoes, I'd have 12K as a general emergency fund. Another 5K in a car fund (I don't mind driving a 5,000 car), 5k in a real estate/home repair fund, and save about 400 per month for yearly insurance and tax costs. Your first point is incorrect, you do have debt in the form of a car lease. That car needs to be replaced, and you might want to upgrade the other car. How much? Perhaps spend 12K on each and sell the existing car for 2K? (19K left). Congratulations on attempting to bootstrap a software company. What kind of cash do you anticipate needing? How about keeping 10K designated for that? (9K left) Assuming that medical school will run you about 50K per year for 4 years how do you propose to pay for it? Assuming that you put away 4K per month for 24 months and have 9K, you will come up about 95K short assuming some interests in your favor. The time frame is too short to invest it, so you are stuck with crappy bank rates.", "title": "" }, { "docid": "80a3dfcc280d42c75783d1b8681fd3b8", "text": "If you want the new car, pay cash for it. Here's why: By paying cash for the car, you immediately save $2,500 off the price of the car. That is not insignificant, it's 8.3% off. By paying cash, you'll never be upside down on the car, and you can sell the car anytime you want. You said that all you need to do is beat the 0.9% interest rate with your investment to come out ahead. That doesn't take into account the discount you would have gotten by paying cash. $30,000 invested for 5 years at 1.6% (rough estimate) would get you $2,500 (the discount), so the rate you need to beat to come out ahead is actually 2.5%. Still doable, but it is much less of a sure thing on a 5 year investment, and much less worth the trouble. New cars are an expensive luxury. If you are wealthy enough, a new car certainly can be appropriate for you. However, if you don't like the idea of paying $30k in cash all at once, that is a strong indication that perhaps the new car is a luxury you aren't in a position to buy at this time. Borrowing the money and paying for it over time makes it psychologically easier to over spend on transportation.", "title": "" }, { "docid": "6e5776554e72177e1428313f872537e1", "text": "\"Thanks for your question. Definitely pay the car down as soon as possible (reasoning to follow). In fact, I would go even further and recommend the following: Why? 1) Make money risk free - the key here is RISK FREE. By paying down the loan now, you can avoid paying interest on the additional amount paid toward principal risk free. Imagine this scenario: if you walked into a bank and they said, \"\"If you give us $100, we'll give you $103 back today\"\", would you do it? That is exactly what you get to do by not paying interest on the remaining loan principal. 2) The spread you might make by investing is not as large as you may think. Let's assume that by investing, you can make a market return of 10%. However, these are future cash flows, so let's discount this for inflation to a \"\"real\"\" 8% return. Then let's assume that after fees and taxes this would be a 7% real after-tax return. You also have to remember that this money is at risk in the market and may not get this return in some years. Assuming that your friend's average tax rate on earned income is 25%, this means that he'd need to earn $400 pre-tax to pay the after-tax payment of $300. So this is a 4% risk-free return after tax compared to a 7% average after tax return from the market, but one where the return is at risk. The equivalent after-tax risk-free return from the market (think T-Bills) is much lower than 7%. You are also reducing risk by paying the car loan off first in a few other ways, which is a great way to increase peace of mind. First, since cars decline in value over time, you are minimizing the possibility that you will eventually end up \"\"under water\"\" on the loan, where the loan balance is greater than the value of the car. This also gives you more flexibility in terms of being able to sell the car at any point if desired. Additionally, if the car breaks down and must be replaced, you would not need to continue making payments on the old loan, of if your friend loses his job, he would own the car outright and would not need to make payments. Finally, ideally you would only be investing in the market when you intend to leave the money there for 5+ years. Otherwise, you might need to pull money out of the market at a bad time. Remember, annual market returns vary quite a bit, but over 5-10 year periods, they are much more stable. Unfortunately, most people don't keep cars 5-10+ years, so you are likely to need the money back for another car more frequently than this. If you are pulling money out of the market every 5-10 years, you are more likely to need to pull money out at a bad time. 3) Killing off the \"\"buy now, pay later\"\" mindset will result in long-term financial benefits. Stop paying interest on things that go down in value. Save up and buy them outright, and invest the extra money into things that generate income/dividends. This is a good long-term habit to have. People also tend to be more prudent when considering the total cost of a purchase rather than just the monthly payment because it \"\"feels\"\" like more money when you buy outright. As a gut check for whether this is a good idea, here is an example that Dave Ramsey likes to use: Suppose that your friend did not have the emergency fund, and also did not have the car loan and owned the car outright. In that case, would your friend take out a title loan on the car in order to have an emergency fund? I think that a lot of people would say no, which may be a good indicator that it is wise to reduce the emergency fund in order to wipe out the debt, rather than maintaining both.\"", "title": "" }, { "docid": "ba4c40ef92b1b89622a3207dc14fd562", "text": "My god man, where do you live that is too expensive to live on your own and 7K isn't enough for emergency cash? Anyway, with your age and income I would be more worried about a long-term sustainable lifestyle. In other words, a job that nets you more than $26K/year. Someday you may want to have a wife and kids and that income sure as hell wont pay for their college. That was life advice, now for financial: I've always been a believer that if someone is not a savvy investor, their priorities before investments should be paying off debt. If you had a lot of capital or knew your way around investment vehicles and applicable returns then I would be telling you something different. But in your case, pay off that car first giving yourself more money to invest in the long-run.", "title": "" }, { "docid": "140add684e81369c5d46fa6354930056", "text": "Do you think your 403b will earn more than the mortgage interest rate? If so, then mortgage seems the way to go. Conservative investment strategies might not earn much more than a 3-4% mortgage, and if you're paying 5-6% it's more likely you'll be earning less than the mortgage. From another point of view, though, I would probably take a loan anyway just from a security standpoint - you have more risk if you put a third of your retirement savings into one purchase directly, whereas if you do a 10-15 year loan, you'll have more of a cushion. Also, if you don't outlive the mortgage, you'll have had use of more of your retirement income than otherwise - though I do wonder if it puts you at some risk if you have significant medical bills (which might require you to liquidate your 403b but wouldn't require you to sell your house, so paying it off has some upside). Also, as @chili555 notes in comments, you should consider the taxation of your 403(b) income. If you pull it out in one lump sum, some of it may be taxed at a higher rate than if you pulled it out more slowly over time, which will easily overwhelm any interest rate differences. This assumes it's not a Roth 403(b) account; if it is Roth then it doesn't matter.", "title": "" }, { "docid": "4fdc0c096584047dd029d2407e86289d", "text": "With a lot excess cash you eventually have two goals: Since interest on cash bank deposits does not exceed inflation and you have currency risk, you may want to get into other asset classes. Options that might be, but not limited to are:", "title": "" }, { "docid": "3c5a9302dc720a0ce0b07887b5d7b754", "text": "\"Making extra principal payments will reduce the term of your loan. I wouldn't sign up for a biweekly schedule, just do it yourself so you have more flexibility. A simple spreadsheet will allow you to play \"\"What if?\"\" and make it clear that extra principal payments are most effective early in the term of the loan. My wife and I paid off our home in less than 10 years with this approach. Some will say that the opportunity costs of not using that money for something else outweighs the gains. I would say that not having a mortgage has a positive impact on your cash flow and your assets (you own the home), which combine to create more opportunity, not less. That being said, It should be obvious that paying off higher interest debt first is the priority, (Paying off a zero percent interest car loan early is just foolish)\"", "title": "" }, { "docid": "4b9b57c631289fcd2c862379e592700e", "text": "Basically you have 4 options: Use your cash to pay off the student loans. Put your cash in an interest-bearing savings account. Invest your cash, for example in the stock market. Spend your cash on fun stuff you want right now. The more you can avoid #4 the better it will be for you in the long term. But you're apparently wise enough that that wasn't included as an option in your question. To decide between 1, 2, and 3, the key questions are: What interest are you paying on the loan versus what return could you get on savings or investment? How much risk are you willing to take? How much cash do you need to keep on hand for unexpected expenses? What are the tax implications? Basically, if you are paying 2% interest on a loan, and you can get 3% interest on a savings account, then it makes sense to put the cash in a savings account rather than pay off the loan. You'll make more on the interest from the savings account than you'll pay on interest on the loan. If the best return you can get on a savings account is less than 2%, then you are better off to pay off the loan. However, you probably want to keep some cash reserve in case your car breaks down or you have a sudden large medical bill, etc. How much cash you keep depends on your lifestyle and how much risk you are comfortable with. I don't know what country you live in. At least here in the U.S., a savings account is extremely safe: even the bank goes bankrupt your money should be insured. You can probably get a much better return on your money by investing in the stock market, but then your returns are not guaranteed. You may even lose money. Personally I don't have a savings account. I put all my savings into fairly safe stocks, because savings accounts around here tend to pay about 1%, which is hardly worth even bothering. You also should consider tax implications. If you're a new grad maybe your income is low enough that your tax rates are low and this is a minor factor. But if you are in, say, a 25% marginal tax bracket, then the effective interest rate on the student loan would be more like 1.5%. That is, if you pay $20 in interest, the government will then take 25% of that off your taxes, so it's the equivalent of paying $15 in interest. Similarly a place to put your money that gives non-taxable interest -- like municipal bonds -- gives a better real rate of return than something with the same nominal rate but where the interest is taxable.", "title": "" }, { "docid": "b49d0970285e5d57edafe60614d14bcf", "text": "Full payment is always better than auto-loan if you are prudent with finances. I.E if you take a loan, you are factoring the EMI hence your savings will remain as is. However if you manage well, you can buy the car with cash and at the same time put aside the notional EMI as savings and investments. The other factor to consider is what return your cash is giving. If this more than auto-loan interest rate post taxes, you should opt for loan. For example if auto-loan is 10% and you are getting a return of 15% after taxes on investment then loan is better. Company Car lease depends on terms. More often you get break on taxes on the EMI component. But you have to buy at the end of lease period and re-register the car in your name, so there is additional cost. Some companies give lease at very favourable rates. Plus if you leave the job lease has to be broken and it becomes more expensive.", "title": "" }, { "docid": "2afd676bda3cbc1e3c24aac9c5a2ab01", "text": "If you decide you need the extra money, you can always go refinance and get more cash out. At the end of the day, though, if you pay off your house sooner you can invest more of your income sooner; that's just a matter of discipline.", "title": "" }, { "docid": "0b22e23fac6f27900f195011905db3fa", "text": "\"What could a small guy with $100 do to make himself not poor? The first priority is an emergency fund. One of the largest expenses of poor people are short-term loans for emergencies. Being able to avoid those will likely be more lucrative than an S&P investment. Remember, just like a loan, if you use your emergency fund, you'll need to refill it. Be smart, and pay yourself 10% interest when you do. It's still less than you'd pay for a payday loan, and yet it means that after every emergency you're better prepared for the next event. To get an idea for how much you'd need: you probably own a car. How much would you spend, if you suddenly had to replace it? That should be money you have available. If you think \"\"must\"\" buy a new car, better have that much available. If you can live with a clunker, you're still going to need a few K. Having said that, the next goal after the emergency fund should be savings for the infrequent large purchases. The emergency fund if for the case where your car unexpectedly gets totaled; the saving is for the regular replacement. Again, the point here is to avoid an expensive loan. Paying down a mortgage is not that important. Mortgage loans are cheaper than car loans, and much cheaper than payday loans. Still, it would be nice if your house is paid when you retire. But here chances are that stocks are a better investment than real estate, even if it's the real estate you live in.\"", "title": "" }, { "docid": "584d3a1d780d21200d209d91a428d8b4", "text": "Cash price is $22,500. Financed, it's the same thing (0% interest) but you pay a $1500 fee. 1500/22500 = 6.6%. Basically the APR for your loan is 1.1% per year but you are paying it all upfront. Opportunity cost: If you take the $22,500 you plan to pay for the car and invested it, could you earn more than the $1500 interest on the car loan? According to google, as of today you can get 1 year CD @ 1.25% so yes. It's likely that interest rates will be going up in medium term so you can potentially earn even more. Insurance cost: If you finance you'll have to get comprehensive insurance which could be costly. However, if you are planning to get it anyway (it's a brand new car after all), that's a wash. Which brings me to my main point: Why do you have $90k in a savings account? Even if you are planning to buy a house you should have that money invested in liquid assets earning you interest. Conclusion: Take the cheap money while it's available. You never know when interest rates will go up again.", "title": "" }, { "docid": "6c7f3f0533ea364be143008b7a33a693", "text": "\"This page lays down the requirements for an \"\"unincorporated association\"\" to pay tax (i.e. any group that's not a registered entity). You pay tax is you make money from: it looks like you don't do any of those, so you don't need to file for taxes. There is another exemption that you don't have to file if it is likely that you would owe less than a hundred pounds taxes, which would also probably apply to you. There are many thousands of clubs and societies in the UK that don't need to register for tax purposes, so you are far from alone. It is probably worth creating an actual club (\"\"Captain Insanity Server Club\"\") and keeping records of donations and expenses for the server. There isn't any need to legally incorporate or anything like that, though you might try having a separate bank account for it if you can get a free one, so that if the tax authorities ever audit you personally you can show them that the donations you received weren't income to you.\"", "title": "" } ]	fiqa
c10849c20cce6cafe3c81a28252c5fac	Meaning of “credit”	[ { "docid": "faf9f9e338f01e03d85205250f7a0f20", "text": "\"You're looking at the \"\"wrong\"\" credit. Here's the Wikipedia article about the bookkeeping (vs the Finance, that you've quoted) term.\"", "title": "" } ]	[ { "docid": "f09e5df95d050feae1e745fb0c66f9bd", "text": "Debit is them taking the money, in your case electronically. Credit is somebody vouching for you and saying you will pay later. They are alternate ways to pay for a product. As a merchant, if you take a credit card you are agreeing that a the issuer of the credit card is going to pay you right away. The issuer of the credit will worry about collecting the money from me. There are a ton of details with regards to why you would use one over another, where the costs in each method are and who pays what for each. The main different is the source of the funds.", "title": "" }, { "docid": "ff8f7a486adf61b296339b15fb9d2700", "text": "Thanks for that, it did help. I think my issue is I don't work in finance itself, I'm a lawyer, and 'capital' generally has a very specific meaning in English company law, where it refers exclusively to shareholder capital. I realise capital in finance terms includes both debt and equity investment.", "title": "" }, { "docid": "1064f3d6b09bfb4a55cc55b5feec1d42", "text": "In credit means you have over paid. I tried with my account. After clearing my bill to 0.0 I paid an extra £10 just to confirm the that money appeared as £10 in credit on the energy website.", "title": "" }, { "docid": "d6d7f1a65634009ecfd05aca99690e15", "text": "\"Credit Scores / Rates are based on sometimes simple and sometimes quite complex Statistical Models (Generalised Linear Models, Neural Networks, Regression and Classification Trees, Mixture Models, etc).This depends on whether it is something more general like FICO or what large banks develop in-house. In any case, there are many legislation-dependent factors (Qualitative such as education, occupation security, sex, etc, payment history; or Quantitative such as age, liquidity and leverage ratios, etc). Now, most model that are used today are propriety and closely held trade secrets. The most important reason for this is actually because of the databases that feed the models. More better quality data is what makes the real difference ... although at the cutting-edge, the mathematicians/statisticians/computer scientists that design the algorithms will make a huge difference. Now, back to the main thing: The Credit Score/Rate is meant to be used only as an indicator for representing the Probability of Default (\"\"How likely you are to default on your obligation towards me?\"\" is what it means and that is largely based upon \"\"Has company/he/she honoured his financial obligations?\"\") of a certain consumer. In more sophisticated models, they may also use your industry sector or occupational and financial security to predict the future behaviour. However, this \"\"Credit Score\"\" has meaning only in relation to a \"\"Credit Limit\"\" (\"\"Can you pay back my $X?\"\"). The credit limit on the other hand is defined by your income level, debt/asset, etc). As a credit risk analyst, whether we are dealing with large corporate loans, mortgages, personal loans, etc), the principles are the same: One thing to consider is that factors considered in determining a credit score usually do not have a simple linear relationship. Consumer Profile types such as utilisation rate are a lot more about EFFECT than CAUSE: The most important thing is to honour your obligations, whether you pay before or after you spend makes little difference, so long as you pay in full and prior to maturity, your rate/score will improve with time. Financial Institutions have many ways to make money of everyone. Some, such as interest rates and fees are directly charged to you and some are charged to your goods-and-services providers. That has no bearing on your score. Sometimes it even makes sense to take on customers with rock-bottom ratings, lend them lots of money, and charge them to dirt. As you may well know, the recent financial crisis - with ongoing after-shocks and tremors - was the result of such practices.\"", "title": "" }, { "docid": "370cf6f6f40a025e10e27035d077e45b", "text": "In this example you are providing 4x more collateral than you are borrowing. Credit score shouldn't matter, regardless of how risky a borrower you are. Sure it costs time and money to go to auction, but this can be factored into your interest rate / fees. I don't see how the bank can lose.", "title": "" }, { "docid": "b27e71a404f46fc0845924799db1fdac", "text": "\"In double-entry bookkeeping, no transaction is ever negative. You only deal in positive numbers. We \"\"simulate\"\" negative numbers by calling numbers debits and credits, where one is the negative of the other. Only a balance can be negative. In this case, Income is a credit account. That means that things that increase your balance are credits and things that reduce your balance are debits. So a gift from grandma is a credit. It's a positive number, and you write it in the credit column. You pretty much never subtract from Income except to correct a mistake. Assets, like a checking account, are debit accounts. Increases are debits and decreases are credits. You routinely have both debits and credits on a checking account, i.e. you put money in and you take money out. Every transaction affects (at least) two accounts: one with a debit and one with a credit. So in this case, the gift from grandma credits income and debits checking. Buying food credits checking and debits expenses.\"", "title": "" }, { "docid": "f84633d5fd361f1e8c7d4f76d5a9b996", "text": "With change in technology and regulations, quite a few clearing systems provide an ability to directly credit a credit card. In Europe Sepa transactions allow one to credit a credit card. The service would be offered by Local bank rather than Visa or Master Card", "title": "" }, { "docid": "f27cfc3a1827ffd98277e4eb068e8f26", "text": ">Actually, I would imagine the terms for credit are better post-bankruptcy filing, than immediately pre-filing. From what I see that's true. Pre filing had no options whatsoever or the terms were so bad that it wasn't worth it. Post filing, while the terms were not the best by no means, at least there were decent options there.", "title": "" }, { "docid": "52e1c589979e235123e70ad8f4e74996", "text": "Is it possible for the card issuing banks to check my score without my permission? As far as I understand these things, that is exactly the whole purpose of these sorts of credit-rating institutions. The banks and other financial businesses are their customers. They exist to serve those customers. Their relationship, if any, with a consumer is probably secondary to that. When you apply for credit, you give that business any permission needed.", "title": "" }, { "docid": "123b203e01d72fcb9fe72081e46a2d2c", "text": "\"Dictionary clarifies http://www.oxforddictionaries.com/definition/english/be-in-credit Definition of be in credit: (Of an account) have money in it: \"\"your statement shows your account to be in credit\"\" And http://www.oxforddictionaries.com/definition/english/be-in-debit?q=in+debit Definition of be in debit: (Of an account) show a net balance of money owed to others: \"\"the account is only 120 francs in debit\"\" The word 'debit' contains the letters 'debt' if it helps remember. I agree the website is confusing.\"", "title": "" }, { "docid": "64a03e132badfa3d034aa6372607bc69", "text": "Creditworthiness is proven over time. The longer your track record of making payments on time, the more probable you will stick to credit agreements in future (or so the reasoning goes). Conversely, someone who has only just started applying for credit could be someone whose finances were previously stable but have now started to get into difficulty. Obviously this is not necessarily the case but it is one possible inference. This inference is strengthened when same person applies for further credit in a short space of time. Ultimately, what is considered positive is a stable credit record over a reasonable period of time, because it indicates you stick to payment schedules and don't suddenly need credit due to money problems. Credit card accounts are considered a good indicator of credit status because they imply what kind of borrower you are. Whereas many credit arrangements present a straightforward case of arrears / no arrears (e.g. think of a mobile phone account – either you pay your bill or you don't), with credit cards there is an element of flexibility in how much you borrow, and how much of that you repay. If you run up four figure monthly balances but clear them in full each month without fail, that is a good sign. If your average balance is increasing and you are paying on time but just the minimum amount, that is a potential flag. In other words, credit cards are of particular interest because they paint a more nuanced picture. Provided you use one responsibly, getting and using a credit card may improve your status with credit reference agencies.", "title": "" }, { "docid": "b5295c9c4c242d39e0504e525c95bdbf", "text": "\"The credit and debit terms here is, talking from bank's point of view (shouldn't be a surprise, banks are never known to look at things from the customers' POV ;)). In accounting, a liability (loans, owners capital etc) is a credit balance and asset (cash, buildings and such) is a debit balance. Your account is a liability to the bank (in accounting parlance that is because they owe you every single penny that is there in your account, btw, in literal parlance too if you really make their life harder ;)) So when the bank accepts money from you, they need to increase their asset (cash) which they will debit (higher debit balance for asset means more assets), and at the same time they also have to account for the added liability by \"\"crediting\"\" the deposited money into your account. So when bank says they have credited your account, it means you have more money in your account. Now, if you transfer money from your account to another, or make a payment through your account, your account will be debited and the beneficiary account will be credited(bank's liability towards you reduces) More or less what everyone else said here... but hey, I could also take a swipe at banks ;))\"", "title": "" }, { "docid": "e363385e0d09936345052a4a848d92ae", "text": "Assuming that a person has good financial discipline and is generally responsible with spending, I think that having a few hundred or thousand dollars extra of available credit is usually worth more to that person for the choice/flexibility it provides in unforeseen circumstance, versus the relatively minor hit that could be taken to their credit score.", "title": "" }, { "docid": "cff871d6a9db37d078fda26572bf526c", "text": "\"It's almost certainly the money you've earned from the bank. Money the bank earned from you would normally be described as \"\"Interest charged\"\" or \"\"Interest payable\"\".\"", "title": "" }, { "docid": "64e9e40b6898d48c338c7559204146d0", "text": "\"I'm afraid the great myth of limited liability companies is that all such vehicles have instant access to credit. Limited liability on a company with few physical assets to underwrite the loan, or with insufficient revenue, will usually mean that the owners (or others) will be asked to stand surety on any credit. However, there is a particular form of \"\"credit\"\" available to businesses on terms with their clients. It is called factoring. Factoring is a financial transaction whereby a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount in exchange for immediate money with which to finance continued business. Factoring differs from a bank loan in three main ways. First, the emphasis is on the value of the receivables (essentially a financial asset), not the firm’s credit worthiness. Secondly, factoring is not a loan – it is the purchase of a financial asset (the receivable). Finally, a bank loan involves two parties whereas factoring involves three. Recognise that this can be quite expensive. Most banks catering to small businesses will offer some form of factoring service, or will know of services that offer it. It isn't that different from cheque encashment services (pay-day services) where you offer a discount on future income for money now. An alternative is simply to ask his clients if they'll pay him faster if he offers a discount (since either of interest payments or factoring would reduce profitability anyway).\"", "title": "" } ]	fiqa
78ee48ec6851bfe2caf9fee741aae412	institutional ownership — why is it so convoluted	[ { "docid": "40e08223ac41fd50cdae1dcf1e7cebc1", "text": "The reason for such differences is that there's no source to get this information. The companies do not (and cannot) report who are their shareholders except for large shareholders and stakes of interest. These, in the case of GoPro, were identified during the IPO (you can look the filings up on EDGAR). You can get information from this or that publicly traded mutual fund about their larger holdings from their reports, but private investors don't provide even that. Institutional (public) investors buy and sell shares all the time and only report large investments. So there's no reliable way to get a snapshot picture you're looking for.", "title": "" } ]	[ { "docid": "bb4603a9d130e55a92bbe6c6147cc416", "text": "More shares mean less volatility because it takes a larger number of trades, a larger number of shares per trade, or a combination of both to raise or lower the stock price. Institutional investors (mutual funds, pensions, hedge funds, other investment firms, etc) are the sorts of organizations with the large amounts of money needed to move a stock price one way or the other. But the more floating shares there are in a company, the harder it is for one or two firms to move a stock price. A company with fewer floating shares wouldn't require as many trades (or as many shares per trade) to see wider swings in price. When it comes to stock price, insider trading isn't the same as manipulation. In the (surprisingly few) cases of insider trading that are prosecuted, it tends to be an individual (or small group) with early access to information that the broader market doesn't have being able to buy or sell ahead of the broader market. Their individual sales are seldom if ever enough to noticeably move a stock price. They're locking in profit or limiting a loss. Manipulation might (but doesn't always) precede insider trading, if misinformation (or truth) is released for the purpose of creating a situation that can be profited from via a trade or trades.", "title": "" }, { "docid": "4a7cb335aa2cfc013f8504d25232875e", "text": "\"It is not clear when you mean \"\"company's directors\"\" are they also majority owners. There are several reasons for Buy; Similarly there are enough reasons for sell; Quite often the exact reasons for Buy or Sell are not known and hence blindly following that strategy is not useful. It can be one of the inputs to make a decision.\"", "title": "" }, { "docid": "2054be436fb48e9b1d7e8b24b853b05c", "text": "That's not what is entirely happening. It's two separate situations. They don't have equal voting and some are able to vote more than once. The two investors want to keep it that way while the rest want to implement an even voting system. The two investors have been asked to drop their lawsuit against the old CEO since he's no longer with the company but it's implied that they will continue to sue him because he still has influence and the ability to elect new board members which he recently added two. Also it's disengrnous to say just the two investors. They are being asked to do this by the shareholders.", "title": "" }, { "docid": "36a14f2330785694a4d87d0fcc7a6ecc", "text": "\"The language in the starbucks accounts is highly ambiguous. But Starbucks has no treasury shares which helps work out what is going on. Where it says \"\"respectively\"\" it is referring to the years 2014 and 2013 rather than \"\"issued and outstanding\"\"...even though it doesn't read that way. Not easy to work out. The figures are: Authorised 1200 2014 Issued 749.5 2014 Outstanding 749.5 2013 Issued 753.2 2013 Outstanding 753.2\"", "title": "" }, { "docid": "f619e556111df0fd3eaf002df79a9597", "text": "Yep, you have it pretty much right. The volume is the number of shares traded that day. The ticker is giving you the number of shares bought at that price in a given transaction, the arrow meaning whether the stock is up or down on the day at that price. Institutional can also refer to pensions, mutuals funds, corporates; generally any shareholder that isn't an individual person.", "title": "" }, { "docid": "12226cbcd9d23ce4d27dc0efef65eece", "text": "Don't have access to a Bloomberg, Eikon ect terminal but I was wondering if those that do know of any functions that show say, the percentage of companies (in different Mcap ranges) held by differing rates institutionally. For example - if I wanted to compare what percentage of small cap companies' shares are 75% or more held by institutions relative to large cap companies what could I search in the terminal?", "title": "" }, { "docid": "f89d2a641744984e2edbf16e4a5d12d4", "text": "Regardless of whether a stock is owned by a retail investor or an institutional investor, it is subject to the same rules. For example, say that as part of the buyout, 1 share of Company B is equivalent to 0.75 shares of Company A and any fractional shares will be paid out in cash. This rule will apply to both the retail investor who holds 500 shares of Company B, as well as the asset manager or hedge fund holding 5,000,000 shares of Company B.", "title": "" }, { "docid": "83a2cbaa34cfc4ae8670f3bbe3363f57", "text": "\"It could be just as exploitable given the current system. Also, who is this \"\"owner\"\"? A large shareholder of a public corporation isn't just going to come into 16 houses. There's a board of directors, and about a million other shareholders, including those in blackrock and vangaurd who have nothing to gain from allowing such corruption. A private company's owner who decided to buy himself a house on the company's dime and not tell the IRS can do so at his peril regardless of tax policy. I still don't understand the point.\"", "title": "" }, { "docid": "5b9bddfbc13053744ab668020e549954", "text": "Yes that is the case for the public company approach, but I was referring to the transaction approach: Firm A and Firm B both have $100 in EBITDA. Firm A has $50 in cash, Firm B has $100 in cash. Firm A sells for $500, Firm B sells for $600. If we didn't subtract cash before calculating the multiple: Firm A: 5x Firm B: 6x If we DO subtract cash before calculating the multiple: Firm A: 4.5x Firm B: 5x So yea, subtracting cash does skew the multiple.", "title": "" }, { "docid": "0e9095fc9405eb42ed89002ef76ec184", "text": "The United Services Automobile Association has a funny legal structure: it's not a corporation and has no shareholders. Policyholders and account holders are paid any profits. In that respect, it functions very much like a credit union; technically, it's structured as a Texas-based and Texas Department of Insurance regulated unincorporated reciprocal inter-insurance exchange and Fortune 500 financial services company offering banking, investing, and insurance to people and families that serve, or served, in the United States military. http://en.wikipedia.org/wiki/USAA Normally a company like this is a corporation so that its owners can benefit from limited liability: otherwise, if the company loses millions or billions, any one of the individual owners / members could be held liable for paying those millions and billions! However, the Texas laws which govern them as a Texas-based inter-insurance exchange also serve to limit the liability of members. The banking services are provided by the USAA Federal Savings Bank, which is structured as a (drumroll) federal savings bank. They also own a couple of other random businesses.", "title": "" }, { "docid": "ddf5fd3f79c3328ebe63da7b040a6570", "text": "Lending of securities is done by institutional investors and mutual funds. The costs of dealing with thousands of individual investors, small share blocks and the various screw-ups and drama associated with each individual are too high. Like many exotic financial transactions, if you have to ask about it, you're probably not qualified to do it.", "title": "" }, { "docid": "778461d4d04e1f3b3c412fae5425ec10", "text": "When you own stock in a company, you do literally own part of the business, even if it's a small portion. Anyone amassing over 50% of shares really does have a controlling interest. No, you can't trade a handful of AAPL shares back to Apple for an iPod, but you can sell the shares and then go buy an iPod with the proceeds. Stock prices change over time because the underlying companies are worth more or less and people are willing to pay more or less for those shares. There is no Ponzi scheme because each share you own can be bought or sold on the open market. Dividends come from the company profits, not from other investors. On the other hand, money only has value because everyone believes it has value. There's the real conspiracy.", "title": "" }, { "docid": "b380943f498a5c8793857f0dfc230e36", "text": "\"Institutional investors are the \"\"elephant\"\" in the room. When they \"\"sneeze,\"\" everyone else \"\"catches cold.\"\" They're fine, if they're buying after YOU do. They're not bad, if you want to buy after they sell en masse. But when you read about moves of 10 percent, 15 percent or more in a single day, it's because a bunch of institutional investors all decided to do the same thing on the same day. That's more volatility than most people can stomach. Fewer institutional investors in a stock mean fewer chances of those things happening.\"", "title": "" }, { "docid": "799905bcd1b35fb35fbfc366e46ce587", "text": "Because it's a declining company and used as an institutional sized pump and dump with a new toxic financing every week. Look up Kalani Investments - they're behind it all.", "title": "" }, { "docid": "daff22609d39d7ef7c465090f1d9b402", "text": "\"Are you talking long-term institutional or retail investors? Long-term retail investors look for orderly markets, the antithesis of HFT business models, which have a direct correlation between market volatility and profits. To a lesser extent, some \"\"dumb money\"\"/\"\"muppet\"\" institutionals do as well. HFT firms tout they supply liquidity into markets, when in fact the opposite is true. Yes, HFTs supply liquidity, but only when the liquidity's benefits runs in their direction. That is, they are applying the part of the liquidity definition that mentions \"\"high trading activity\"\", and conveniently ignoring the part that simultaneously requires \"\"easily buying or selling an asset\"\". If HFT's are the new exchange floor, then they need to be formalized as such, and become bound to market maker responsibilities. If they are actually supplying liquidity, like real Designated Market Makers in the NYSE for example, they become responsible to supply a specified liquidity for specified ticker symbols in exchange for their informational advantage on those tickers. The indisputable fact is that HFT cannot exist at their current profit levels without the information advantage they gain with preferential access to tick-by-tick data unavailable to investors who cannot afford the exchange fees ($1M per exchange 10 years ago, more now). Restrict the entire market, including HFTs, to only second-by-second price data without the tick-by-tick depth, and they won't do so well. Don't get me wrong, I'm not knocking HFTs per se; I think they are a marvelous development, so long as they really do \"\"supply liquidity\"\". Right now, they aren't doing so, and especially in an orderly manner. If you want retail investors to keep out of the water as they are doing now, by all means let HFT (and regulatory capture, and a whole host of other financial service industry ills) run as they are. There are arguments to be made about \"\"only let the professionals play the market\"\", where there is no role for retail and anyone who doesn't know how to play the long-term investment game needs to get out of the kitchen. But if you are making such an argument, come out and say so.\"", "title": "" } ]	fiqa
c9a49bd60a803a50e21ee85092eab2c1	Valuation Spreadsheet	[ { "docid": "ed624e3d707fc0bd9929dc7ab0e1bff5", "text": "Yes, all of that is possible with google sheets...", "title": "" }, { "docid": "7df383e4d1841d9374ee8934d96a29e9", "text": "In general spreadsheets can do all of what you ask. Have a try of some online training like these to get started.", "title": "" } ]	[ { "docid": "1a5555a3e6f08c85ad4c80c424b96211", "text": "Volume-weighted average price In finance, volume-weighted average price (VWAP) is the ratio of the value traded to total volume traded over a particular time horizon (usually one day). It is a measure of the average price at which a stock is traded over the trading horizon. VWAP is often used as a trading benchmark by investors who aim to be as passive as possible in their execution. Many pension funds, and some mutual funds, fall into this category. *** ^[ [^PM](https://www.reddit.com/message/compose?to=kittens_from_space) ^\| [^Exclude ^me](https://reddit.com/message/compose?to=WikiTextBot&message=Excludeme&subject=Excludeme) ^\| [^Exclude ^from ^subreddit](https://np.reddit.com/r/finance/about/banned) ^\| [^FAQ ^/ ^Information](https://np.reddit.com/r/WikiTextBot/wiki/index) ^\| [^Source](https://github.com/kittenswolf/WikiTextBot) ^] ^Downvote ^to ^remove ^\| ^v0.24", "title": "" }, { "docid": "5b5c6f5d4b26bd4c954cdb1558e22cf8", "text": "\"I could not figure out a good way to make XIRR work since it does not support arrays. However, I think the following should work for you: Insert a column at D and call it \"\"ratio\"\" (to be used to calculate your answer in column E). Use the following equation for D3: =1+(C3-B3-C2)/C2 Drag that down to fill in the column. Set E3 to: =(PRODUCT(D$3:D3)-1)365/(A3-A$2) Drag that down to fill in the column. Column E is now your annual rate of return.\"", "title": "" }, { "docid": "7aec2e5d1480a09c5e8c8671d32c6e8d", "text": "\"A bit strange but okay. The way I would think about this is again that you need to determine for what purpose you're computing this, in much the same way you would if you were to build out the model. The IPO valuation is not going to be relevant to the accretion/dilution analysis unless you're trying to determine whether the transaction was net accretive at exit. But that's a weird analysis to do. For longer holding periods like that you're more likely to look at IRR, not EPS. EPS is something investors look at over the short to medium term to get a sense of whether the company is making good acquisition decisions. And to do that short-to-medium term analysis, they look at earnings. Damodaran would say this is a shitty way of looking at things and that you should probably be looking at some measure of ROIC instead, and I tend to agree, but I don't get paid to think like an investor, I get paid to sell shit to them (if only in indirect fashion). The short answer to your question is that no, you should not incorporate what you are calling liquidation value when determining accretion/dilution, but only because the market typically computes accretion/dilution on a 3-year basis tops. I've never put together a book or seen a press release in my admittedly short time in finance that says \"\"the transaction is estimated to be X% accretive within 4 years\"\" - that just seems like an absurd timeline. Final point is just that from an accounting perspective, a gain on a sale of an asset is not going to get booked in either EBITDA or OCF, so just mechanically there's no way for the IPO value to flow into your accretion/dilution analysis there, even if you are looking at EBITDA/shares. You could figure the gain on sale into some kind of adjusted EBITDA/shares version of EPS, but this is neither something I've ever seen nor something that really makes sense in the context of using EPS as a standardized metric across the market. Typically we take OUT non-recurring shit in EPS, we don't add it in. Adding something like this in would be much more appropriate to measuring the success of an acquisition/investing vehicle like a private equity fund, not a standalone operating company that reports operational earnings in addition to cash flow from investing. And as I suggest above, that's an analysis for which the IRR metric is more ideally situated. And just a semantic thing - we typically wouldn't call the exit value a \"\"liquidation value\"\". That term is usually reserved for dissolution of a corporate entity and selling off its physical or intangible assets in piecemeal fashion (i.e. not accounting for operational synergies across the business). IPO value is actually just going to be a measure of market value of equity.\"", "title": "" }, { "docid": "6f35493317b0fa9767a0827ede4a4505", "text": "I appreciate it. I didn't operate under selling the asset year five but other than that I followed this example. I appreciate the help. These assignments are just poorly laid out. Financial management also plays on different calculation interactions so it is difficult for me to easily identify the intent at times. Thanks again.", "title": "" }, { "docid": "d0f013cb3f6e5e8f6175286a974da69f", "text": "\"By the sounds of things, you're not asking for a single formula but how to do the analysis... And for the record you're focusing on the wrong thing. You should be focusing on how much it costs to own your car during that time period, not your total equity. Formulas: I'm not sure how well you understand the nuts and bolts of the finance behind your question, (you may just be a pro and really want a consolidated equation to do this in one go.) So at the risk of over-specifying, I'll err on the side of starting at the very beginning. Any financial loan analysis is built on 5 items: (1) # of periods, (2) Present Value, (3) Future Value, (4) Payments, and (5) interest rate. These are usually referred to in spreadsheet software as NPER, PV, FV, PMT, and Rate. Each one has its own Excel/google docs function where you can calculate one as a function of the other 4. I'll use those going forward and spare you the 'real math' equations. Layout: If I were trying to solve your problem I would start by setting up the spreadsheet up with column A as \"\"Period\"\". I would put this label in cell A2 and then starting from cell A3 as \"\"0\"\" and going to \"\"N\"\". 5 year loans will give you the highest purchase value w lowest payments, so n=60 months... but you also said 48 months so do whatever you want. Then I would set up two tables side-by-side with 7 columns each. (Yes, seven.) Starting in C2, label the cells/columns as: \"\"Rate\"\", \"\"Car Value\"\", \"\"Loan Balance\"\", \"\"Payment\"\", \"\"Paid to Interest\"\", \"\"Principal\"\", and \"\"Accumulated Equity\"\". Then select and copy cells C2:I2 as the next set of column headers beginning in K2. (I usually skip a column to leave space because I'm OCD like that :) ) Numbers: Now you need to set up your initial set of numbers for each table. We'll do the older car in the left hand table and the newer one on the right. Let's say your rate is 5% APR. Put that in cell C1 (not C3). Then in cell C3 type =C$1/12. Car Value $12,000 in Cell D3. Then type \"\"Down Payment\"\" in cell E1 and put 10% in cell D1. And last, in cell E3 put the formula =D3(1-D$1). This should leave you with a value for the first month in the Rate, Car Value, and Loan Balance columns. Now select C1:E3 and paste those to the right hand table. The only thing you will need to change is the \"\"Car Value\"\" to $20,000. As a check, you should have .0042 / 12,000 / 10,800 on the left and then .0042 / 20,000 / 18,000 on the right. Formulas again: This is where spreadsheets become amazing. If we set up the right formulas, you can copy and paste them and do this very complicated analysis very quickly. Payment The excel formula for Payment is =PMT(Rate, NPER, PV, FV). FV is usually zero. So in cell F3, type the formula =PMT(C3, 60, E3, 0). Obviously if you're really doing a 48 month (4 year) loan then you'll need to change the 60 to 48. You should be able to copy the result from cell F3 to N3 and the formula will update itself. For the 60 months, I'm showing the 12K car/10.8K loan has a pmt of $203.81. The 20K/18K loan has a pmt of 339.68. Interest The easiest way to calculate the interest is as =E3C3. That's (Outstanding Loan Balance) x (Periodic Interest Rate). Put this in cell G4, since you don't actually owe any interest at Period 0. Principal If you pay PMT each month and X goes to interest, then the amount to principal is \"\"PMT - X\"\". So in H4 type =-F3 - G3. The 'minus' in front of F3 is because excel's PMT function returns a negative amount. If you want to, feel free to type \"\"=-PMT(...)\"\" for the formula that's actually in F3. It's your call. I get 159 for the amount to principal in period 1. Accumulated Equity As I mentioned in the comment, your \"\"Equity\"\" comes from your initial Loan-to-Value and the accumulated principal payments. So the formula in this cell should reflect that. There are a variety of ways to do this... the easiest is just to compare your car's expected value to your loan balance every time. In cell I3, type =(D3-E3). That's your initial equity in the car before making any payments. Copy that cell and paste it to I4. You'll see it updates to =(D4-E3) automatically. (Right now that is zero... those cells are empty, but we're getting there) The important thing is that as JB King pointed out, your equity is a function of accumulated principal AND equity, which depreciates. This approach handles those both. Finishing up the copy-and-paste formulas I know this is long, but we're almost done. Rate // Period 1 In cell C4 type =C3. Payment // Period 1 In cell F4 type =F3. Loan Balance // Period 1 In cell E4 type =E3-H4. Your loan balance at the end of period is reduced by the principal you paid. I get 10,641. Car Value // Period 1 This will vary depending on how you want to handle depreciation. If you ignore it, you're making a major error and it's not worth doing this entire analysis... just buy the prettiest car and move on with life. But you also don't have to get it scientifically accurate. Go to someplace like edmunds.com and look up a ballpark. I'm using 4% depreciation per year for the old (12K) car and 7% for the newer car. However, I pulled those out of my ass so figure out what's a better ballpark. In G1 type \"\"Depreciation\"\" and then put 4% in H1. In O1 type \"\"Depreciation\"\" and then 7% in P1. Now, in cell D4, put the formula =D3 (1-(H$1/12)). Paste formulas to flesh out table As a check, your row 4 should read 1 / .0042 / 11,960 / 10,641 / 203.81 / 45 / 159 / 1,319. If so, you're great. Copy cells C4:I4 and paste them into K4:Q4. These will update to be .0042 / 19,883 / 17,735 / 339.68 / 75 / 265 / 2,148. If you've got that, then copy C4:Q4 and paste it to C5:C63. You've built a full amortization table for your two hypothetical loans. Congratulations. Making your decision I'm not going to tell you what to decide, but I'll give you a better idea of what to look at. I would personally make the decision based on total cost to own during that time period, plus a bit of \"\"x-factor\"\" for which car I really liked. Look at Period 24, in columns I and Q. These are your 'equities' in each car. If you built the sheet using my made-up numbers, then you get \"\"Old Car Equity\"\" as 4,276. \"\"New Car Equity\"\" is 6,046. If you're only looking at most equity, you might make a poor financial decision. The real value you should consider is the cost to own the car (not necessarily operate it) during that time... Total Cost = (Ending Equity) - (Payment x 24) - (Upfront Cash). For your 'old' car, that's (4,276) - (203.81 * 24) - (1,200) = -1,815.75 For the 'new' car, that's (6,046) - (339.68 * 24) - (2,000) = -4,106.07. Is one good or bad? Up to you to decide. There are excel formulas like \"\"CUMPRINC\"\" that can consolidate some of the table mechanics, but I assumed that if you're here asking you would have gotten stuck running some of those. Here's the spreadsheet: https://docs.google.com/spreadsheet/ccc?key=0Ah0weE0QX65vdHpCNVpwUzlfYjlTY2VrNllXOS1CWUE#gid=1\"", "title": "" }, { "docid": "227085867cf45b9715b131058918dc42", "text": "Thank you very much for this thoughtful response. In my opinion the judges care more about the why behind your valuation rather than a how. Anyone can use a formula, but it takes so much more to understand why to use the formula. Personally, the 'why' is going to be the toughest part for me understand and wrap my head around. Once again thank you for the advice and the tip.", "title": "" }, { "docid": "90f3ac4042a941d61e7a35f1938326dc", "text": "\"The Securities Industry and Financial Markets Association (SIFMA) publishes these and other relevant data on their Statistics page, in the \"\"Treasury & Agency\"\" section. The volume spreadsheet contains annual and monthly data with bins for varying maturities. These data only go back as far as January 2001 (in most cases). SIFMA also publishes treasury issuances with monthly data for bills, notes, bonds, etc. going back as far as January 1980. Most of this information comes from the Daily Treasury Statements, so that's another source of specific information that you could aggregate yourself. Somewhere I have a parser for the historical data (since the Treasury doesn't provide it directly; it's only available as daily text files). I'll post it if I can find it. It's buried somewhere at home, I think.\"", "title": "" }, { "docid": "835aea544af9ee19eb114bf793e8f425", "text": "\"I keep spreadsheets that verify each $ distribution versus the rate times number of shares owned. For mutual funds, I would use Yahoo's historical data, but sometimes shows up late (a few days, a week?) and it isn't always quite accurate enough. A while back I discovered that MSN had excellent data when using their market price chart with dividends \"\"turned on,\"\" HOWEVER very recently they have revamped their site and the trusty URLs I have previously used no longer work AND after considerable browsing, I can no longer find this level of detail anywhere on their site !=( Happily, the note above led me to the Google business site, and it looks like I am \"\"back in business\"\"... THANKS!\"", "title": "" }, { "docid": "2737555cec11157babb0aff5bd578d75", "text": "\"the \"\"how\"\" all depends on your level of computer savvy. Are you an Excel spreadsheet user or can you write in programming languages such as python? Either approach have math functions that make the calculation of ROI and Volatility trivial. If you're a python coder, then look up \"\"pandas\"\" (http://pandas.pydata.org/) - it handles a lot of the book-keeping and downloading of end of day equities data. With a dozen lines of code, you can compute ROI and volatility.\"", "title": "" }, { "docid": "c3dab5f5b1e022dab0028cec8b0265ad", "text": "That is called a 'volume chart'. There are many interactive charts available for the purpose. Here is clear example. (just for demonstration but this is for India only) 1) Yahoo Finance 2) Google Finance 3) And many more Usually, the stock volume density is presented together (below it) with normal price vs time chart. Note: There is a friendly site about topics like this. Quant.stackexchange.com. Think of checking it out.", "title": "" }, { "docid": "1ebc364846535cd64021290e9b7af494", "text": "You could create your own spreadsheet of Cash Flows and use the XIRR function in Excel: The formula is:", "title": "" }, { "docid": "44e7a7cb513b863434091609d159ded7", "text": "I'm responsible for all our hedging. Since we sell the energy to end users we do mostly fixed buys, swaps and calls. I'm a excel guru and dabble a little in SQL. we have Crystal Ball as well but i have no idea how to use it. I guess I'm trying to figure out if there is a tool that people use to help me analyze the spreads. or perhaps some reading material to help me through this. This is what i've been working towards for so long and i really don't want to fuck this up", "title": "" }, { "docid": "b4ae774d48fa6d2cae21d71ed5c702bf", "text": "\"A (very) simplified bond-pricing equation goes thus: Fair_Price: {Face_Value * (1 + Interest - Expected_Market_Return) ^ (Years_To_Maturity)} * P(Company_Will_Default_Before_Maturity) To reiterate, that is a very simplified model. But it allows us to demonstrate the 3 key factors that drive \"\"Fair\"\" Value: The interest relative to the current market rate. If your AAA bond yields 1%, but an equally-good AAA bond currently sells at 3% in the market, then the \"\"Equivalent\"\" value is the face value minus 2% (1% - 3%) for every year to maturity. Years to maturity. Because 1) is multiplied for every year to maturity, longer-dated bonds are more sensitive to changes in market rates. If your bond yields 2% less than market but matures in a year, then it's worth $98, but if it matures in 56 years, then it's only worth 0.98^56 = $32. Conversely, if your bond yields more than the market rate, then its' price will be greater than face value. The company might default on the debt. If a Bond has a \"\"Fair\"\" Value of $100, but you think there's a 50% chance that the company will default, then it's only worth $50. In fact, it can be worth even less because getting paid on a defaulted bond can often take time and/or money and/or lawyers. In your case, because your bond matures in 56 years but yields ~5% (well above the current market rate), for it to be below Face value implies a strong probability of default, or a strong belief that market returns will be above 5% over the next 56 years.\"", "title": "" }, { "docid": "24a78ce01e579101c6b2cf6529438d5b", "text": "It is meant to be a Valuation Model. So the data I have collected are for the Addressable Markets in potential countries( i.e. population currently affected by the disease and potential growth of the disease in the future). Possible competition for the drug. And most importantly the expenses of the drug (how much it cost to create the drug and clinical trails etc.) I need to create a Revenue chart and the Pricing for the drug as well. What I am looking for is someone who is familiar with creating a valuation model or has a template and can give me advice on how to structure this. thanks.", "title": "" }, { "docid": "ce932128386e9ac1e3bdbe0c347a0ad7", "text": "If annualized rate of return is what you are looking for, using a tool would make it a lot easier. In the post I've also explained how to use the spreadsheet. Hope this helps.", "title": "" } ]	fiqa
a256910a688b4b157564d508d9a53252	How to quickly track daily cash expenses that don't come with a receipt?	[ { "docid": "5fc6ec273abd1bf196aef714bfe04e1d", "text": "A pencil and a small notepad really work here, but if you have a smartphone then some way of using it makes sense as well. Try: Transcribe all of these onto a better record at the end of each day. Also record the amount of money in your wallet/purse/pocket every day, and check to see if the amounts you've recorded add up to the amount you've spent. It'll be easier to remember that newspaper you bought at the end of the day, rather than a week later. Or just record the difference as 'miscellaneous'.", "title": "" }, { "docid": "08269cad97f7652817cd4ad52c38e523", "text": "Go the opposite approach. Budget a certain amount of cash and keep it combined. Don't exceed it (but next time budget more if you need to). If you were in the USA (where card acceptance is near universal) what I do is simply use my visa check card for all purchases and download it to my personal finance software, where you can assign categories.", "title": "" } ]	[ { "docid": "a5a8f00d13d6121c63e2703247e507dc", "text": "\"Bookkeeping and double-entry accounting is really designed for tracking the finances of a single entity. It sounds like you're trying to use it to keep multiple entities' information, which may somewhat work but isn't really going to be the easiest to understand. Here's a few approaches: In this approach, the books are entirely from your perspective. So, if you're holding onto money that \"\"really\"\" belongs to your kids, then what you've done is you're taking a loan from them. This means that you should record it as a liability on your books. If you received $300, of which $100 was actually yours, $100 belongs to Kid #1 (and thus is a loan from him), and $100 belongs to Kid #2 (and thus is a loan from her), you'd record it just that way. Note that you only received $100 of income, since that's the only money that's \"\"yours\"\", and the other $200 you're only holding on behalf of your kids. When you give the money to your kids or spend it on their behalf, then you debit the liability accordingly and credit the Petty Cash or other account you spent it from. If you wanted to do this in excruciating detail, then your kids could each have their own set of books, in which they would see a transfer from their own Income:Garage Sale account into their Assets:Held by Parents account. For this, you just apportion each of your asset accounts into subaccounts tracking how much money each of you has in it. This lets you treat the whole family as one single entity, sharing in the income, expenses, etc. It lets you see the whole pool of money as being the family's, but also lets you track internally some value of assets for each person. Whenever you spend money you need to record which subaccount it came from, and it could be more challenging if you actually need to record income or expenses separately per person (for some sort of tax reasons, say) unless you also break up each Income and Expense account per person as well. (In which case, it may be easier just to have each person keep their entirely separate set of books.) I don't see a whole lot of advantages, but I'll mention it because you suggested using equity accounts. Equity is designed for tracking how much \"\"capital\"\" each \"\"investor\"\" contributes to the entity, and for tracking a household it can be hard for that to make a lot of sense, though I suppose it can be done. From a math perspective, Equity is treated exactly like Liabilities in the accounting equation, so you could end up using it a lot like in my Approach #1, where Equity represents how much you owe each of the kids. But in that case, I'd find it simpler to just go ahead and treat them as Liabilities. But if it makes you feel better to just use the word Equity rather than Liability, to represent that the kids are \"\"investing\"\" in the household or the like, go right ahead. If you're going to look at the books from your perspective and the kids as investing in it, the transaction would look like this: And it's really all handled in the same way an Approach #1. If on the other hand, you really want the books to represent \"\"the family\"\", then you'd need to have the family's books really look more like a partnership. This is getting a bit out of my league, but I'd imagine it'd be something like this: That is to say, the family make the sale, and has the money, and the \"\"shareholders\"\" could see it as such, but don't have any obvious direct claim to the money since there hasn't been a distribution to them yet. Any assets would just be assumed to be split three ways, if it's an equal partnership. Then, when being spent, the entity would have an Expense transaction of \"\"Dividend\"\" or the like, where it distributes the money to the shareholders so that they could do something with it. Alternatively, you'd just have the capital be contributed, And then any \"\"income\"\" would have to be handled on the individual books of the \"\"investors\"\" involved, as it would represent that they make the money, and then contributed it to the \"\"family books\"\". This approach seems much more complicated than I'd want to do myself, though.\"", "title": "" }, { "docid": "b4510cf6016c180b947eab26ae6b837c", "text": "\"Here's a very basic MySQL query I put together that does what I want for income/expense report. Basically it reports the same info as the canned income/expense report, but limits it those income/expenses associated with a particular account (rental property, in my case). My main complaint is the output \"\"report\"\" is pretty ugly. And modifying for a different rental property requires changing the code (I could pass parameters etc). Again, the main \"\"issue\"\" in my mind with GnuCash income/expense report is that there is no filter for which account (rental property) you want income/expenses for, unless you set up account tree so that each rental property has its own defined incomes and expenses (i.e. PropertyA:Expense:Utility:electric). Hopefully someone will point me to a more elegant solution that uses the report generator built into GnuCash. THanks! SELECT a2.account_type , a4.name, a3.name, a2.name, SUM(ROUND(IF(a2.account_type='EXPENSE',- s2.value_num,ABS(s2.value_num))/s2.value_denom,2)) AS amt FROM ( SELECT s1.tx_guid FROM gnucash.accounts AS a1 INNER JOIN gnucash.splits AS s1 ON s1.account_guid = a1.guid WHERE a1.name='Property A' ) AS X INNER JOIN gnucash.splits s2 ON x.tx_guid = s2.tx_guid INNER JOIN gnucash.accounts a2 ON a2.guid=s2.account_guid INNER JOIN gnucash.transactions t ON t.guid=s2.tx_guid LEFT JOIN gnucash.accounts a3 ON a3.guid = a2.parent_guid LEFT JOIN gnucash.accounts a4 ON a4.guid = a3.parent_guid WHERE a2.name <> 'Property A' # get all the accounts associated with tx in Property A account (but not the actual Property A Bank duplicate entries. AND t.post_date BETWEEN CAST('2016-01-01' AS DATE) AND CAST('2016-12-31' AS DATE) GROUP BY a2.account_type ,a4.name, a3.name, a2.name WITH ROLLUP ; And here's the output. Hopefully someone has a better suggested approach!\"", "title": "" }, { "docid": "d69a4e4466093ccea9e763adb6374aa4", "text": "Businesses are only required to keep receipts over $751. However for individuals, I would throw them all in a shoebox and not worry about organizing them. There's a small chance you'll need to go through them during an audit, and you can worry about reconciling all of them and putting them in order at that point. Just write 2010 on the box and keep it somewhere easy, and at the end of the year throw it in your basement (or get a scanner, and scan and trash the original).", "title": "" }, { "docid": "94ddf1032cb45bb5c777b866ae873592", "text": "\"I found your post while searching for this same exact problem. Found the answer on a different forum about a different topic, but what you want is a Cash Flow report. Go to Reports>Income & Expenses>Cash Flow - then in Options, select the asset accounts you'd like to run the report for (\"\"Calle's Checking\"\" or whatever) and the time period. It will show you a list of all the accounts (expense and others) with transactions effecting that asset. You can probably refine this further to show only expenses, but I found it useful to have all of it listed. Not the prettiest report, but it'll get your there.\"", "title": "" }, { "docid": "5f4c85a0ec524834a22e73607839809b", "text": "I wrote a small Excel-based bookkeeping system that handles three things: income, expenses, and tax (including VAT, which you Americans can rename GST). Download it here.", "title": "" }, { "docid": "afbad616ddab631737a1ca4a87b3fadc", "text": "\"If you're curious, here are my goals behind this silly madness You said it... The last two words, I mean...:-) If you're auditing your statements - why do you need to keep the info after the audit? You got the statement for last month, you verified that the Starbucks charge that appears there is the same as in your receipts - why keeping them further? Done, no $10 dripping, throw them away. Why do you need to keep your refrigerator owner's manual? What for? You don't know how to operate a refrigerator? You don't know who the manufacturer is to look it up online in case you do need later? Read it once, mark the maintenance details in your calendar (like: TODO: Change the water filter in 3 months), that's it. Done. Throw it away (to the paper recycle bin). You need the receipt as a proof of purchase for warranty? Make a \"\"warranty\"\" folder and put all of them there, why in expenses? You don't buy a refrigerator every months. That's it, this way you've eliminated the need to keep monthly expenses folders. Either throw stuff away after the audit or keep it filed where you really need it. You only need a folder for two months at most (last and current), not for 12 months in each of the previous 4 years.\"", "title": "" }, { "docid": "b941ec8a64dd8a7efd3690dab33cd768", "text": "Try the following apps/services: Receipt Bank (paid service, gathers paper receipts, scans them and processes the data), I've tested it, and it recognizing receipts very well, taking picture is very quick and easy, then you can upload the expenses into your accounting software by a click or automatically (e.g. FreeAgent), however the service it's a bit expensive. They've apps for Android and iPhone. Expentory (app and cloud-based service for capturing expense receipts on the move),", "title": "" }, { "docid": "6ab84a4012b949349f3fa5c4f201402e", "text": "I use iBank for Mac to keep track of my expenses. I also use the iPhone version since they can sync over Wi-Fi and I can capture expenses right on the spot instead of trying to remember what I spent on when I turn on my laptop.", "title": "" }, { "docid": "1d27970c7bb23fd79499c7f484c5da1b", "text": "First, I try to keep electronic records (with appropriate backups) whenever it seems feasible: utility bills, credit card statements, bank statements, etc. This greatly cuts down on storage space, and are kept forever. For hard copy records, it depends on the transaction. I try to balance filing time and recover time, by how likely it is that I will need to access a record in the future. I'm much less likely to need the receipt for this mornings coffee at Starbucks than I am to need the utility bill for my rental property (100%, come tax time). For instance, by default I file my credit card receipts, that don't get filed elsewhere, by year with all cards kept together, and cull them after 5-7 years. I keep all of the credit card receipts, just because it is less effort for me than making a decision about what to keep and what to discard. I put them in an accordion file by month of charge, and keep two, for the current year and previous years. At the beginning of each year, I get rid of the receipts in the oldest file and reuse it. Anything that needs to be kept longer that a couple of years gets filed separately. Certain records are kept together. For example, car repair/maintenance receipts are filed by vehicle and kept for the life of the vehicle (could be useful when its sold, to provide the repair history). All receipts for the rental property are kept together, organized by account. I'll keep these until the property is sold. All tax related receipts that don't have a specific file are kept together, by year, along with the tax return.", "title": "" }, { "docid": "7e6a30f5616e94418f406aebfface37b", "text": "Have you looked into GnuCash? It lets you track your stock purchases, and grabs price updates. It's designed for double-entry accounting, but I think it could fit your use case.", "title": "" }, { "docid": "83826f181cbed6fb08aa3d823a249337", "text": "The stores track the individual items for inventory planning and marketing purposes. Having worked in the transaction processing business for a time (writing one), I can say with confidence that the credit/debit card companies do not receive an itemized list of the items involved in the transaction. There is usually a description field in the information transmitted to the processor, which may or may not contain useful information. But it is not big enough to contain an itemized grocery list of any size. And it is not standardized in any way that would facilitate reliable parsing. There may be an amount of metadata about the transaction that would indicate the types of products involved in the transaction, which they can also infer from the merchant reporting the transaction. There are efforts to increase the amount of data reported, but they are not widely used yet, due to the overwhelming numbers of banks that would need to be upgraded. These efforts are rolling out only in specific and limited uses where the banks involved are willing to upgrade software and equipment. For now, the best way to know what you bought is to keep your receipts from the store. Shoeboxes work great for this. So do smartphone cameras and a folder on your hard drive. There are also mobile apps that track receipts for you, and may even try to OCR the data for you.", "title": "" }, { "docid": "e0f9d662699f54ed72b77f3d14e342b8", "text": "I'd say you have a couple options that differ by the amount of time required. Option 1: Export your checking/credit card ledgers from your banks for the unaccounted for periods you mention then import them into GNUcash. They won't be categorized, but it's a fairly simple task to go through and categorize the main ones. Anything else can be categorized in an 'unaccounted for' account and either properly categorized over time at a later date or just left unaccounted for. Option 2: Make one entry in each of your liabilities and assets that is also part of the 'unaccounted for' expense account, but contains the number required to balance your accounts now. This is by far the easiest and will allow you to start with a clean slate now but keep your prior records in the same ledger. Option 3: Start a new ledger with the same account/expense structure as your previous ledger. From here on out, you'd open this GNUCash file and start fresh. Also quick and easy but there is no way to look at the old ledger and run reports unless you open that separately. I actually do this every couple of years as a way to force me to clear out obsolete accounts and trim the fat since GNUcash can take a long time to open when the ledger contains many years of transactions.", "title": "" }, { "docid": "acd8edcab069333c4f0510ce02c9a3e2", "text": "Personally, it is the tenant's stupidity to leave cash and not get a receipt. If it were me, I would demand payment. But then $750 to me is a lot more than it may be to others. This is entirely a personal decision, legally I don't think the tenant has a leg to stand on because they have no proof they actually paid you, regardless of how or where they 'left it'.", "title": "" }, { "docid": "459f2b37e547afbe10ef09522529d1d6", "text": "The best way is to retain the charge slips. After you are done for the month you can discard them. Alternatively if you are using any of the personal finance tool or a simple XLS to track exepnses, it would be easy to figure out what you actually spent and what was not yours.", "title": "" }, { "docid": "60e5e50342d8e0101f8d1103e5d885d2", "text": "\"Perhaps you can track your VAT amounts in a Liability account. Using a tax liability account is a common thing in accounting. To do this, when you receive money, split the transaction such that your actual revenue (which you will keep after VAT remittance) goes into an Asset account, and the amount you will eventually have to pay back to the state goes into a Liability account. Later, when you pay the VAT back to the state, your transaction will effectively \"\"pay back\"\" the liability, with one end of your double-entry decreasing the funds in your checking account, and the other end decreasing the funds in your tax liability account. Having said that, I've found that there are many shortcomings in the Cash Flow report, and I'm not sure that using a tax liability account (which I think is the Right Thing to do) will necessarily solve this problem for you...\"", "title": "" } ]	fiqa
c4e2b94e8783b6ff2e66a347066b1f60	What actions should I be taking to establish good credit scores for my children?	[ { "docid": "6ec5bf02eb05a8458978817549471a9f", "text": "\"When I was in high school, my mom got me a joint credit account with both of our names on it for exactly this reason. Well, that, and to have in case I found myself in some sort emergency, but it was mostly to build credit history. That account is still on my credit report (it's my oldest by a few years), and looking at the age of it, I was 17 at the time we opened it (and I think my younger sister got one around the same time). In my case, I now have an \"\"excellent\"\" credit score and my weakest area is the age of my accounts, so having that old account definitely helps me. I don't think I've really taken advantage of it, and I'm not sure if I'd really be worse off if my mom hadn't done that, but it certainly hasn't hurt. And I plan on buying a house in the next year or so, so having anything to bump up the credit score seems like a good thing.\"", "title": "" }, { "docid": "9a43caccb4e26c98f5a98bd0ff63cf78", "text": "Until they're old enough to be legally responsible for their own credit, the only thing you can really do is show them by example how to manage money and credit in your own finances. Teach them budgeting, immerse them in understanding how credit and financing work, and teach them smart ways to make their money work for them. When they're teenagers, you could potentially approach small banks or credit unions about ways to perhaps co-sign loans for them and let them make payments to learn good habits for managing their responsibilities, but that's not always easy either. It won't do anything for their credit, but having the responsibility of coming in to make payments might instill good habits and help their self-esteem at the same time. You have great intentions, but as has been pointed out here already, from a legal standpoint there's not much you can do. All you can do is prepare them for the day when they are on their own and can enter into credit agreements. Kids going to college get into real trouble with credit because cards are handed out like candy to them by the banks, so teaching them money management skills is invaluable and something you can do now.", "title": "" }, { "docid": "681f7184bde61e9ceafddbd27414387a", "text": "You really can't. Credit rating is determined by financial history, and until your kids are old enough to legally sign a contract they have essentially no financial history. Interesting out-of-the-box thought, but not workable.", "title": "" }, { "docid": "0c9e775e3cbdb0666196bc0c97ef20bf", "text": "My son who is now 21 has never needed me to cosign on a loan for him and I did not need to establish any sort of credit rating for him to establish his own credit. One thing I would suggest is ditch the bank and use a credit union. I have used one for many years and opened an account there for my son as soon as he got his first job. He was able to get a debit card to start which doesn't build credit score but establishes his account work the credit union. He was able to get his first credit card through the same credit union without falling work the bureaucratic BS that comes with dealing with a large bank. His interest rate may be a bit higher due to his lack of credit score initially but because we taught him about finance it isn't really relevant because he doesn't carry a balance. He has also been able to get a student loan without needing a cosigner so he can attend college. The idea that one needs to have a credit score established before being an adult is a fallacy. Like my son, I started my credit on my own and have never needed a cosigner whether it was my first credit card at 17 (the credit union probably shouldn't have done that since i wasn't old enough to be legally bound), my first car at 18 or my first home at 22. For both my son and I, knowing how to use credit responsibly was far more valuable than having a credit score early. Before your children are 18 opening credit accounts with them as the primary account holder can be problematic because they aren't old enough to be legally liable for the debt. Using them as a cosigner is even more problematic for the same reason. Each financial institution will have their own rules and I certainly don't know them all. For what you are proposing I would suggest a small line of credit with a credit union. Being small and locally controlled you will probably find that you have the best luck there.", "title": "" } ]	[ { "docid": "f06cf5d6bdbc29866e0b2983fbd8b4a1", "text": "\"Any kind of credit contract such as a mobile phone contract (could be SIM only or with a handset) would also help increase your number of accounts and demonstrate a track record of responsible management and repayments. If you have a Pay As You Go phone at present consider a SIM only contract with the same network, and if your parents currently pay for your phone consider if it would be worth switching it into your own name. Also make sure that you are registered on the Electoral Role at your permanent address and have at least a minimum payment direct debit set up on your credit card (even though you state you intend to repay in full) to make sure you don't forget a payment as this will disproportionately affect your score when combined with young age and few other accounts. Lastly ensure that you have a decent amount of \"\"head room\"\" on your rolling credit accounts like credit cards and aren't using more than 80% of the credit available to you through your monthly spending, if necessary by asking for an increased limit from your company (and then not using it).\"", "title": "" }, { "docid": "d4b52b0c13dd806ac5f96114ba0c7cd6", "text": "Good credit is calculated (by many lenders) by taking your FICO score which is calculated based upon what is in your credit report. Building credit generally means building up your FICO score. Your FICO score is impacted my many factors, one small one of which is your utilization ratio of your installment loans like student loans. This is the ratio of the current balance to your original balance. To improve your score (slightly) you would want a lower ratio. I would recommend paying your student loan down to 75% ratio as fast as you can and then you can go back to $50/month. A much better way to improve your FICO score is to have revolving credit. Your student loans are not revolving, they are installment loans. Therefore, you should open at least one credit card (assuming you currently have none) right away. The longer you have had a credit card open, the better your FICO score gets. Your revolving credit utilization ratio is way more important than your installment loan ratio. Therefore, to maximize your FICO, try to never have more than 10% utilization on your revolving credit report to the credit bureaus each month. Only the current month's ratio affects your score at any given moment. You can ensure you don't go above 10% by paying your balance before the statement cuts each month to get it below 10% way before any payment would be due. (You should always pay your remaining credit card statement balance in full each month by the due date after the statement cuts to avoid any interest charges.) Note that there is a slight FICO advantage to having at least one major bank credit card instead of just only credit union credit cards. Also, never let all your revolving credit report a zero balance in a month, you must always have at least $1 reporting to the credit bureaus on at least one of your open credit cards or your FICO score will take a big negative hit. If you cannot get a normal credit card, go to a credit union and find one that offers secured credit cards, or a bank that does. A secured credit card is where you place a deposit with the bank that they hold and give you a credit limit to match your security. Ideally it would be a card that graduates to unsecured after your demonstrate good history with them. For example, the Navy Federal Credit Union secured card unsecures for many people. I also believe the Wells Fargo Bank credit card (you can join if there is a family member who served or a roomate who did) also will unsecure. The reason you want it to unsecure and not be forced to open a new account to get an unsecured account is that you want your average age and oldest age of open revolving credit accounts to be as high as possible as this is another impact on your FICO score. Credit unions that anyone can join include, Digital Federal Credit Union, the Pentagon Federal Credit Union (which offers a secured card that does not graduate), and The State Department Federal Credit Union (also offers secured card that I think does not graduate). One other method to boost your FICO score is to get added as an authorized user on one of your parent's credit cards that has been open a long time. Not all lenders will report such an authorized user, however, ones that are known to do so are: Bank of America, Citi Bank, and Capital One. It is a good sign that it will report if they ask for the social security number of the authorized user. However, note that the Authorized User addition can have no impact if the lender is using one of the newer versions of the FICO scoring model, only the older versions reward you for the age of accounts for which you are an authorized user. A very long term boost is to open your first American Express card underwritten directly by Amex such as their Zync card which is pretty easy to get. The advantage of American express is that they remember the date your first credit card was opened with them and if you open new accounts in the future they will back date the date of their opening to match the date your first card was opened. If you let your membership lapse, be sure to record the account number and date opened in your personal files so that you can help them locate it again if you reopen as they can have trouble if it has been on the order of ten years or more. Finally, note that the number of accounts opened in the last twelve months is a small negative mark on your score (along with number of inquiries), so if you open a lot of accounts all at once, in addition to bringing down your average age of accounts, you will also get dinged for how many were opened in the last year.", "title": "" }, { "docid": "60f197fcd24ac4a0004f929ef51fa4a2", "text": "This strategy will have long lasting effects since negative items can persist for many years, making financing a home difficult, the primary source of household credit. It is also very risky. You can play hard, but then the creditor may choose you to be the one that they make an example out of by suing you for a judgement that allows them to empty your accounts and garnish your wages. If you have no record of late payments, or they are old and/or few, your credit score will quickly shoot up if you pay down to 10% of the balance, keep the cards, and maintain that balance rate. This strategy will have them begging you to take on more credit with offers of lower interest rates. The less credit you take on, the more they'll throw at you, and when it comes time to purchase a home, more home can be bought because your interest rates will be lower.", "title": "" }, { "docid": "16e25911a45c2f58774a7d7359982862", "text": "I was in a similar situation with my now 6 year old. So I'll share what I chose. Like you, I was already funding a 529. So I opened a custodial brokerage account with Fidelity and chose to invest in very low expense index fund ETFs which are sponsored by Fidelity, so there are no commissions. The index funds have a low turnover as well, so they tend to be minimal on capital gains. As mentioned in the other answer, CDs aren't paying anything right now. And given your long time to grow, investing in the stock market is a decent bet. However, I would steer clear of any insurance products. They tend to be heavy on fees and low on returns. Insurance is for insuring something not for investing.", "title": "" }, { "docid": "39aa9172cca72e1bd3023423e442c419", "text": "Not only should you do this, you should tell your friends to do it too. Especially if a parent comes in to the bank with the child, banks fall over themselves to provide a card to someone whose only income is allowance. Really. Later, if you're 21 and your car broke and you don't get paid for another 11 days, NOBODY will lend you the money (or those money mart places that charge 300% a year will) to fix it. Never mind score (and yes for sure having a good score will be a result, and a good one) just having the card for emergencies makes all the difference to your early twenties. My kids have several friends who now can't get credit cards (some are students, some are underemployed) and end up missing paid days of work due to car troubles they can't pay to fix, or using those payday lenders, or other things that keep you poor. Get one while you can. Using it sensibly means you will have a great credit score in a decade or so, but just plain having it is worth more than you can know if you're not 18 yet.", "title": "" }, { "docid": "2fc8c81cef377418df1a030a70b4eb8b", "text": "If you are not banking with a credit union, open an account. Speak with a person there an explain you are wanting to build your credit history. They will likely have a product designed for the purpose. Also, to agree with duffbeer703, why is your score so low at this point? Make sure your three credit reports do not have anything incorrect on them and challenge wrong items. If everything is fine on the report, you just to have more credit and use it for a longer period of time. I presume you are building credit for a large purchase such as a house. Please be very careful with borrowing money and do your best to avoid carrying balances.", "title": "" }, { "docid": "d09b34b720637430e86f14b7e1ad35b7", "text": "You probably won't get a mortgage. UDSA has a 41% ratio of monthly debt to monthly income limit, and a score of 660 or better. A 250,000 mortgage at current rates for 30 year mortgage is about $1560/mo. (included in this figure is the 1% mortgage insurance premium, the .4% annual fee, the current rate for a 660 credit rating, the 2% points fee added at the front of the mortgage, typical closing cost added to transaction, and the .5% fee for over-mortgage insurance for the first 3 years since your mortgage will be higher than the value of the house due to these additional fees) Credit card payments = $120 ($60 times 2) Car payments = $542 ($271 for your car, $271 for the car you will be getting) Student loan = $50/month Child Support = $500/month Total = $2772/month Your income per month is 82000/12 = $6833/month $2772/$6833 = 40.6%... This is awfully close to the limit, so they likely would also look at your ability to save. Not seeing savings in the above example, I assume it is low. USDA site One mortgage help site breaks down some of the requirements into layman's language. Not knowing your exact location (county/state) and how many children you have, it is hard to be sure whether you make too much to qualify. This link shows the income limits by number of people in the house and the county/state. There are few places in which you could be living that would qualify you to any of their programs unless you have a several children. As others have posted, I suggest you get your debt down.", "title": "" }, { "docid": "62f39baa2450b442da29dd911a7f77dc", "text": "I think you've made a perfectly valid suggestion, and, if your son is struggling somewhat financially now, one that may be very welcome. If you agree to forgive the debt at this time in lieu of a similar amount forgone in future inheritance, it will eliminate the never ending interest-only payments, free up $200+ a month for you son on a tight budget, and improve your own credit score once you pay off the credit line. It's also, in my opinion, a good idea to be open about this in advance with your other children heirs so that everyone will understand what is expected during the eventual probate. My paternal grandfather was the recipient of a great deal of financial largess from his wealthy mother during her life, and it was fully understood by him, her, and his siblings, that in exchange he would not share in her estate when she passed. He didn't, there were no problems, and he and his siblings stayed close for the rest of their lives.", "title": "" }, { "docid": "71c5d6bcf38f61d6e21be33a3a5e1dd3", "text": "Sorry. As far as I know, a person's SS is the only way to establish credit. This is the first thing they ask whenever you apply for any service in the US.", "title": "" }, { "docid": "4414e027b470e0bbfd52df49d5900c61", "text": "I would advise against this, answering only the first part of question #1. Borrowing and lending money among friends and family members can often ruin relationships. While it can sometimes be done successfully, this is most likely not the case. All parties involved have to approach this uniquely in order for it to work. This would include your son's future significant other. Obviously you have done very well financially, congratulations. Your view for your son might be for him to pay you off ASAP: Even after becoming a doctor, continue to live like a student until the loan is paid off. His view might be more conventional; get the car and house and pay off my loans before I am 50. He may start with your view, but two years in he marries a woman that pressures him to be more conventional. My advice would be to give if you can afford to, but if not, do not lend. If you decide to lend then come up with a very clear agreement on the repayment schedule and consequences of non-payment. You may want to see a lawyer. For the rest of it, interest payments received are taxable.", "title": "" }, { "docid": "822995c764a20e47c252de0284d046ef", "text": "A 529 has a custodian and beneficiary. If, say, my Mom is custodian and my daughter the beneficiary, neither my daughter, my wife, nor I can access this account. In fact, if my daughter chooses not to attend college, Mom can change beneficiaries. So, a 529 is ideal for what you have described. By the way, your wife may have broken the law. Money in your child's name/SSN cannot simply be taken from the account at a parent's whim. You have every right to ask for an accounting of that money and insist she return it to your child's account. Edit - I was going to add that UTMA money may only be spent for the benefit of the child, and not for day to day items, food, clothing, etc. The article The proper use of UTMA funds provides a bit of support to my position on that.", "title": "" }, { "docid": "99203c88c1c3e174e639b20cbb55e3be", "text": "If credit scoring works in the UK like it does in the US, then I think the fact that you own+use a credit card and pay off your everyday expenses will give you perfectly good credit. Just keep doing what you're doing. I have seen people in the United States with very high credit scores based solely upon owning & occasionally using a credit card, paid in full and on time every month.", "title": "" }, { "docid": "28d8fb25f927be0346124fa6b356d346", "text": "You could conceivably open a few accounts. For example, a bank account and a credit card account. Then the accounts will be older when evaluated for credit when you return. This would look better than opening fresh accounts later. But don't expect a big difference in score. And you'll be stuck with those accounts in the future, otherwise you lose the benefit. I wouldn't worry about maintaining balances now. You can wait until you come back. Occasional purchases may be helpful. What they really want to see is a regular and sustained use of accounts without missing payments or overextending. But if you're not going to be here, you can't really do that. Note that good credit scores are based on seven years of data, preferably a lot of it. Opening a few accounts can't substitute for that, even if you put balances on them. If you're not here, you won't be paying rent or utilities. You won't have a proven payment history on the most common accounts. If money were no object, you could do something like purchase a house or condo that you could rent out, utilities included. That would build up a payment history. But if money were no object, you probably wouldn't be worried about your credit score. It's more practical to just live normally and be sure that you always live within your means so that you don't experience negative credit events. You might think about why you want a good credit score. Is it to borrow a lot of money? You might be able to spend money to achieve that. Is it to save money on future borrowing? If it costs money now, how much will you save total? Opening accounts now that you won't really use until you return is about the only thing that you can do that won't cost you money. Perhaps put a balance on the bank account--at least you'll get that money back some day. Maintaining a balance on the credit cards would cost you money in interest charges, and you don't really benefit from an improved credit score until you use your credit. So the interest fees aren't really buying you anything.", "title": "" }, { "docid": "49136c4aa863e265570541bc1bcd0c3a", "text": "K, welcome to Money.SE. You knew enough to add good tags to the question. Now, you should search on the dozens of questions with those tags to understand (in less than an hour) far more than that banker knows about credit and credit scores. My advice is first, never miss a payment. Ever. The advice your father passed on to you is nonsense, plain and simple. I'm just a few chapters shy of being able to write a book about the incorrect advice I'd heard bank people give their customers. The second bit of advice is that you don't need to pay interest to have credit cards show good payment history. i.e. if you choose to use credit cards, use them for the convenience, cash/rebates, tracking, and guarantees they can offer. Pay in full each bill. Last - use a free service, first, AnnualCreditReport.com to get a copy of your credit report, and then a service like Credit Karma for a simulated FICO score and advice on how to improve it. As member @Agop has commented, Discover (not just for cardholders) offers a look at your actual score, as do a number of other credit cards for members. (By the way, I wouldn't be inclined to discuss this with dad. Most people take offense that you'd believe strangers more than them. Most of the answers here are well documented with links to IRS, etc, and if not, quickly peer-reviewed. When I make a mistake, a top-rated member will correct me within a day, if not just minutes)", "title": "" }, { "docid": "cdf88af3f4a06fb4676cd304af9accb7", "text": "Exec Insiders have to file with the SEC and some sites like secform4.com track it. But many insiders have selling programs where the sell the same amount every month or quarter so you would have to do your homework to determine if there are real signals in the activity.", "title": "" } ]	fiqa
6b1fd840c59f9406375494ea88890182	Resources to begin trading from home?	[ { "docid": "ec810457bc6dc84333d3cdded358d2a1", "text": "Your plan won't work. Working 40 hours a week at federal minimum wage (currently $7.25 / hr) for 52 weeks is an annual income of just over $15,000. Even assuming you can reliably get a return of 15% (which you definitely can't), you'd need to start with $100,000 of assets to earn this poverty income. Assuming a more reasonable 7% bumps the required assets up to over $200,000, and even then you're dead the first time you need to make withdrawals after a mistake or after a major market downturn. As a fellow math Ph.D. student, I know your pain. I, too, struggled for a while with boredom in an earlier career, but it's possible to make it work. I think the secret is to find a job that's engaging enough that your mind can't wander too much at work, and set aside some hobby time to work on interesting projects. You likely have some marketable skills that can work for you outside of academia, if you look for them, to allow you to find an interesting job. I think there's not much you can do besides trying not to get fired from your next McJob until you can find something more interesting. There's no magic money-for-nothing in the stock market.", "title": "" }, { "docid": "30f9b89b8dbfc12556848e570c45f60e", "text": "As JoeTaxpayer has commented, the markets are littered with the carcasses of those who buy into the idea that markets submit readily to formal analysis. Financial markets are amongst the most complex systems we know of. To borrow a concept from mathematics - that of a chaotic system - one might say that financial markets are a chaotic system comprised of a nested structure of chaotic subsystems. For example, the unpredictable behaviour of a single (big) market participant can have dramatic effects on overall market behaviour. In my experience, becoming a successful investor requires a considerable amount of time and commitment and has a steep learning curve. Your actions in abandoning your graduate studies hint that you are perhaps lacking in commitment. Most people believe that they are special and that investing will be easy money. If you are currently entertaining such thoughts, then you would be well advised to forget them immediately and prepare to show some humility. TL/DR; It is currently considered that behavioural psychology is a valuable tool in understanding investors behaviour as well as overall market trends. Also in the area of psychology, confirmation bias is another aspect of trading that it is important to keep in mind. Quantitative analysis is a mathematical tool that is currently used by hedge funds and the big investment banks, however these methods require considerable resources and given the performance of hedge funds in the last few years, it does not appear to be worth the investment. If you are serious in wanting to make the necessary commitments, then here are a few ideas on where to start : There are certain technical details that you will need to understand in order to quantify the risks you are taking beyond simple buying and holding financial instruments. For example, how option strategies can be used limit your risk; how margin requirements may force your hand in volatile markets; how different markets impact on one another - e.g., the relationship between bond markets and equity markets; and a host of other issues. Also, to repeat, it is important to understand how your own psychology can impact on your investment decisions.", "title": "" }, { "docid": "d1d1092c729bf1c0d6d13a0404f41686", "text": "Since then I had gotten a job at a supermarket stocking shelves, but recently got fired because I kept zoning out at work This is not a good sign for day trading, where you spend all day monitoring investments. If you start focusing on the interesting math problem and ignoring your portfolio, you can easily lose money. Not so big a problem for missed buy opportunities, but this could be fatal for missed sale opportunities. Realize that in day trading, if you miss the uptick, you can get caught in a stock that is now going down. And I agree with those who say that you aren't capitalized well enough to get started. You need significantly more capital so that you can buy a diversified portfolio (diversification is your limitation, not hedging). Let's say that you make money on two out of three stocks on average. What are the chances that you will lose money on three stocks in a row? One in twenty-seven. What if that happens on your first three stocks? What if your odds at starting are really one in three to make money? Then you'll lose money more than half the time on each of your first three stocks. The odds don't favor you. If you really think that finance would interest you, consider signing up for an internship at an investment management firm or hedge fund. Rather than being the person who monitors stocks for changes, you would be the person doing mathematical analysis on stock information. Focusing on the math problem over other things is then what you are supposed to be doing. If you are good at that, you should be able to turn that into a permanent job. If not, then go back to school somewhere. You may not like your schooling options, but they may be better than your work options at this time. Note that most internships will be easier to get if you imply that you are only taking a break from schooling. Avoid outright lying, but saying things like needing to find the right fit should work. You may even want to start applying to schools now. Then you can truthfully say that you are involved in the application process. Be open about your interest in the mathematics of finance. Serious math minds can be difficult to find at those firms. Given your finances, it is not practical to become a day trader. If you want proof, pick a stock that is less than $100. Found it? Write down its current price and the date and time. You just bought that stock. Now sell it for a profit. Ignore historical data. Just monitor the current price. Missed the uptick? Too bad. That's reality. Once you've sold it, pick another stock that you can afford. Don't forget to mark your price down for the trading commission. A quick search suggests that $7 a trade is a cheap price. Realize that you make two trades on each stock (buy and sell), so that's $14 that you need to make on every stock. Keep doing that until you've run out of money. Realize that that is what you are proposing to do. If you can make enough money doing that to replace a minimum wage job, then we're all wrong. Borrow a $100 from your mom and go to town. But as others have said, it is far more realistic to do this with a starting stake of $100,000 where you can invest in multiple stocks at once and spread your $7 trading fee over a hundred shares. Starting with $100, you are more likely to run out of money within ten stocks.", "title": "" }, { "docid": "80a8b9c11b7b7f5901c61027d8fcda8a", "text": "So you're 23 with no higher graduation, certificates etc which would allow you to study / training but with a high passion for logical thinking and math? Im 31 now, i was in a similar position back then when i was 23. The very best thoughts i want to throw you over: FORGET IT (AT LEAS THIS WAY) - You need cash equity (not borrowed) to even get a foot in the door (read on why) . The fact that you even consider to trade with a few hundred dollar shows how desperate you're, it would very likely result in loss, resignation and mental pain. Let me get you a reality check: If you think you can quadruple your money within months with ease and no risk your wrong - this mindset is gambling - don't end up as gambler. To make 24K a year or 2K a month (taxes are not included) would mean 10% a month on a 20K account which would be almost impossible on a long run (show me a hedge-fund with that performance) - What do you do on draw down months - 3 months no profit would mean you're 8K behind - you wont make a living wit ha 20K account in a western civilization and normal lifestyle. Big question, how do you want to trade? Everything newsfeed / latency based is very hard to compete in. So called technical systems drawing lines, fancy indicators etc are bogus in my opinion (read taleb black swan). Trading/speculation based on fundamentals is a different animal - It to be able to do that you would need to understand the market you trade and what influences it, takes lot time, brainpower , tools ready (ugh, hard to write the picture on my mind). Im 31 years into trading now, seen so many faces come and most of them go in that time , to me it sounds like you quietly hope for a lotto ticket. To speak about hardware, ie the tools you need depends on your trading style (again a hint that a lot more study is needed. If you're really hooked, readreadread and get in touch with people - always question yourself.", "title": "" }, { "docid": "f05c173cec91dfa3a213b5e9609df6a1", "text": "\"A good place to start is to read, such as : Robert T. Kiyosaki : poor dad rich dad. It is quite simple but it gives the good mindset to start. But moreover it is stated in the book : \"\"the best investement you can make is educate yourself\"\". You current situation is quite difficcult, but don't give up on your study. From your post i didn't understand : do you have a master degree? If you love math, learn coding and find a job in banking or else. People that know how to code AND have a good level in math worth a lot.\"", "title": "" } ]	[ { "docid": "5390ccf80d5ca97b63c0c6cb1002ce4d", "text": "Yes many people operate accounts in usa from outside usa. You need a brokerage account opened in the name of your sister and then her username and password. Remember that brokerages may check the location of login and may ask security questions before login. So when your sister opens her account , please get the security questions. Also note that usa markets open ( 7.00 pm or 8.00 pm IST depending on daylight savings in usa). So this means when they close at 4:00 pm ET, it will be 1:30 or 2:30 am in India. This means it will affect your sleeping hours if you intend to day trade. Also understand that there are some day trading restrictions and balances associate. Normally brokerages need 25,000 $ for you to be a day trader. Finally CFA is not a qualification to be a trader and desire to become a trader doesn't make one a trader. TO give an analogy , just because you want to be a cricketer doesn't make you one. It needs a lot of practice and discipline.Also since in bangladesh , you will always convert the usa amount to bangladeshi currency and think of profits and losses in those terms. This might actually be bad.", "title": "" }, { "docid": "e2fee46231608345a1eb985c0a67d440", "text": "You cannot have off-campus employment in your first year, but investments are considered passive income no matter how much time you put into that effort. Obviously you need to stay enrolled full-time and get good enough grades to stay in good standing academically, so you should be cautious about how much time you spend day trading. If the foreign market is also active in a separate time zone, that may help you not to miss class or otherwise divert your attention from your investment in your own education. I have no idea about your wealth, but it seems to me that completing your degree is more likely to build your wealth than your stock market trades, otherwise you would have stayed home and continued trading instead of attending school in another country.", "title": "" }, { "docid": "5a83c41e0a07b2235e9e033cc4f9bab3", "text": "Go to fidelity.com and open a free brokerage account. Deposit money from your bank account into your fidelity account. (expect a minimum of $2500, FBIDX requires more I believe) Buy free to trade ETF Funds of your liking. I tend to prefer US Bonds to stocks, FBIDX is a decent intermediate US Bond etf, but the euro zone has added a little more volatile lately than I'd like. If you do really want to trade stocks, you may want to go with a large cap fund like FLCSX, but it is more risky especially in this economy. (but buy low sell high right?) I've put my savings into FBIDX and FGMNX (basically the same thing, intermediate bond ETF funds) and made $700 in interest and capitol gains last year. (started with zero initially, have 30k in there now)", "title": "" }, { "docid": "49183a72c0b15726b887ab56f8c064b5", "text": "\"This is a tough question, because it is something very specific to your situation and finances. I personally started at a young age (17), with US$1,000 in Scottrade. I tried the \"\"stock market games\"\" at first, but in retrospect they did nothing for me and turned out to be a waste of time. I really started when I actually opened my brokerage account, so step one would be to choose your discount broker. For example, Scottrade, Ameritrade (my current broker), E-Trade, Charles Schwab, etc. Don't worry about researching them too much as they all offer what you need to start out. You can always switch later (but this can be a little of a hassle). For me, once I opened my brokerage account I became that much more motivated to find a stock to invest in. So the next step and the most important is research! There are many good resources on the Internet (there can also be some pretty bad ones). Here's a few I found useful: Investopedia - They offer many useful, easy-to-understand explanations and definitions. I found myself visiting this site a lot. CNBC - That was my choice for business news. I found them to be the most watchable while being very informative. Fox Business, seems to be more political and just annoying to watch. Bloomberg News was just ZzzzZzzzzz (boring). On CNBC, Jim Cramer was a pretty useful resource. His show Mad Money is entertaining and really does teach you to think like an investor. I want to note though, I don't recommend buying the stocks he recommends, specially the next day after he talks about them. Instead, really pay attention to the reasons he gives for his recommendation. It will teach you to think more like an investor and give you examples of what you should be looking for when you do research. You can also use many online news organizations like MarketWatch, The Motley Fool, Yahoo Finance (has some pretty good resources), and TheStreet. Read editorial (opinions) articles with a grain of salt, but again in each editorial they explain why they think the way they think.\"", "title": "" }, { "docid": "fc8484f24d0c259e02cb1c1a590e2d52", "text": "\"A lot of investors prefer to start jumping into tools and figuring out from there, but I've always said that you should learn the theory before you go around applying it, so you can understand its shortcomings. A great starting point is Investopedia's Introduction to Technical Analysis. There you can read about the \"\"idea\"\" of technical analysis, how it compares to other strategies, what some of the big ideas are, and quite a bit about various chart patterns (cup and handle, flags, pennants, triangles, head & shoulders, etc). You'll also cover ideas like moving averages and trendlines. After that, Charting and Technical Analysis by Fred McAllen should be your next stop. The material in the book overlaps with what you've read on Investopedia, but McAllen's book is great for learning from examples and seeing the concepts applied in action. The book is for new comers and does a good job explaining how to utilize all these charts and patterns, and after finishing it, you should be ready to invest on your own. If you make it this far, feel free to jump into Fidelity's tools now and start applying what you've learned. You always want to make the connection between theory and practice, so start figuring out how you can use your new knowledge to generate good returns. Eventually, you should read the excellent reference text Technical Analysis of the Financial Markets by John Murphy. This book is like a toolbox - Murphy covers almost all the major techniques of technical analysts and helps you intuitively understand the reasoning behind them. I'd like to quote a part of a review here to show my point: What I like about Mr. Murphy is his way of showing and proving a point. Let me digress here to show you what I mean: Say you had a daughter and wanted to show her how to figure out the area of an Isosceles triangle. Well, you could tell her to memorize that it is base*height/2. Or if you really wanted her to learn it thoroughly you can show her how to draw a parallel line to the height, then join the ends to make a nice rectangle. Then to compute the area of a rectangle just multiply the two sides, one being the height, the other being half the base. She will then \"\"derive\"\" this and \"\"understand\"\" how they got the formula. You see, then she can compute the area under a hexagon or a tetrahedron or any complex object. Well, Mr. Murphy will show us the same way and \"\"derive\"\" for us concepts such as how a resistance line later becomes a support line! The reson for this is so amusing that after one reads about it we just go \"\"wow...\"\"\"\" Now I understand why this occurs\"\". Murphy's book is not about strategy or which tools to use. He takes an objective approach to describing the basics about various tools and techniques, and leaves it up to the reader to decide which tools to apply and when. That's why it's 576 pages and a great reference whenever you're working. If you make it through and understand Murphy, then you'll be golden. Again, understand the theory first, but make sure to see how it's applied as well - otherwise you're just reading without any practical knowledge. To quote Richard Feynman: It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong. Personally, I think technical analysis is all BS and a waste of time, and most of the top investors would agree, but at the end of the day, ignore everyone and stick to what works for you. Best of luck!\"", "title": "" }, { "docid": "41408550c754bf06e2a72480dd970f12", "text": "Try https://sparkprofit.com/ You practice with real market prices, and it's free. Plus you can get real money pay outs if you do well. I earned 1 cent! hahaha I gave up trying to make money from it, but you get an idea of doing trades and how impossible it is to predict what the price will be. It has some tutorials and helpful things too.", "title": "" }, { "docid": "21b890429ad52c9daf27275afc511a82", "text": "I personally am from Canada and use my local bank to trade stocks. Contact your local bank and they will tell you how to do it, since rules depend on country of residency. If you are not close to a bank, e-mail the major bank in the country of your residence.", "title": "" }, { "docid": "5e926b3fac533119204833cd6bc4f96a", "text": "\"I'm posting this because I think I can do a better job of explaining and detailing everything from start to stop. :) A \"\"broker\"\" is just someone who connect buyers and sellers - a middleman of sorts who is easy to deal with. There are many kinds of brokers; the ones you'll most commonly hear about these days are \"\"mortgage broker\"\" (for arranging home loans) and \"\"stockbroker\"\". The stockbroker helps you buy and sell stock. The stockbroker has a connection to one or more stock exchanges (e.g. Nasdaq, NYSE) and will submit your orders to them in order to fulfill it. This way Nasdaq and NYSE don't have to be in the business of managing millions of customer accounts (and submitting tax information about those accounts to the government and what-not) - they just manage relationships with brokerages, which is much easier for them. To invest in a stock, you will need to: In this day and age, most brokers that you care about will be easily accessed via the Internet, the applications will be available on the Internet, and the trading interface will be over the Internet. There may also be paper and/or telephone interfaces to the brokerage, but the Internet interface will work better. Be aware that post-IPO social media stock is risky; don't invest any money if you're not prepared for the possibility of losing every penny of it. Also, don't forget that a variety of alternative things exist that you can buy from a broker, such as an S&P 500 index fund or exchange-traded corporate bond fund; these will earn you some reward over time with significantly less risk. If you do not already have similar holdings through a retirement plan, you should consider purchasing some of these sooner or later.\"", "title": "" }, { "docid": "c2ef4b2ccfc7d4cf242313750d63b89c", "text": "I learned most of this stuff from 3 textbooks in school probably totaling $900 between the 3. I imagine you don't want to spend the cash on that. I would suggest finding a source online. A lot of the surface level stuff you are looking for can be found online on websites like Investopedia. They are a great resource and are free usually.", "title": "" }, { "docid": "bdfc7642df93ade5220c28e1d09e3f68", "text": "This kind of thing is right up my ally. I am based in Australia so suggestions will be Australian based. I was looking at starting up a private consultancy. Basically use neto as your ERM and online website. link in to xero for accounts. Netos predictive inventory module tells you when to restock on raw materials.", "title": "" }, { "docid": "d8bd50cfab7a7dfa28146c0fa17dbe77", "text": "Based on my experience with OpenQuant, which is a development platform for automated trading strategies (and therefore can be easily be used for backtesting your personal strategy), I can give a little insight into what you might look for in such a platform. OpenQuant is a coding environment, which reads data feeds from a variety of sources (more on that in the second point), and runs the code for your strategy on that data and gives you the results. The data could be imported from a live data feed or from historical data, either through numerous API's, CSV/Excel, etc. You can write your own strategies using the custom C# libraries included with the software, which spares you from implementing your own code for technical indicators, basic statistical functions, etc. Getting the data is another issue. You could use joe's strategy and calculate option prices yourself, although you need to exercise caution when doing this to test a strategy. However, there is no substitute for backtesting a strategy on real data. Markets change over time, and depending on how far back you're interested in testing your strategy, you may run into problems. The reason there is no substitute for using real data is that attempting to replicate the data may fail in some circumstances, and you need a method of verifying that the data you're generating is correct and realistic. Calculating a few values, comparing them to the real values, and calibrating accordingly is a good idea, but you have to decide for yourself how many checks you want to do. More is better, but it may not be enough to realistically test your strategy. Disclaimer: Lest you interpret my post as a shameless plug for the OpenQuant platform, I'll state that I found the interface awful (it looked vaguely like Office 2000 but ten years too late) and the documentation woefully incomplete. I last used the software in 2010, so it may have improved in the intervening years, but your mileage may vary. I only use it as an example to give some insight into what you might look for in a backtesting platform. When you actually begin trading, a different platform is likely in order. That being said, it responded fairly quickly and the learning curve wasn't too steep. The platform wasn't too expensive at the time (about $700 for a license with no data feeds, I think) but I was happy that the cost wasn't coming out of my pocket. It's only gotten more expensive and I'm not sure it's worth it.", "title": "" }, { "docid": "e06218ad5241fdad9d48acc2f7afd1e7", "text": "A great way to learn is by watching then doing. I run a very successful technical analysis blog, and the first thing I like to tell my readers is to find a trader online who you can connect with, then watch them trade. I particularly like Adam Hewison, Marketclub.com - This is a great website, and they offer a great deal of eduction for free, in video format. They also offer further video based education through their ino.tv partner which is paid. Here is a link that has their free daily technical analysis based stock market update in video format. Marketclub Daily Stock Market Update Corey Rosenblum, blog.afraidtotrade.com - Corey is a Chartered Market Technician, and runs a fantastic technical analysis blog the focuses on market internals and short term trades. John Lansing, Trending123.com - John is highly successful trader who uses a reliable set of indicators and patterns, and has the most amazing knack for knowing which direction the markets are headed. Many of his members are large account day traders, and you can learn tons from them as well. They have a live daily chat room that is VERY busy. The other option is to get a mentor. Just about any successful trader will be willing to teach someone who is really interested, motivated, and has the time to learn. The next thing to do once you have chosen a route of education is to start virtual trading. There are many platforms available for this, just do some research on Google. You need to develop a trading plan and methodology for dealing with the emotions of trading. While there is no replacement for making real trades, getting some up front practice can help reduce your mistakes, teach you a better traders mindset, and help you with the discipline necessary to be a successful trader.", "title": "" }, { "docid": "c2818bdbcd005e911a4f2012b17a4d0a", "text": "The answer is to your question is somewhat complicated. You will be unable to compete with the firms traditionally associated with High Frequency Trading in any of their strategies. Most of these strategies which involve marketing making, latency arbitrage, and rebate collection. The amount of engineering required to build the infrastructure required to run this at scale makes it something which can only be undertaken by a team of highly skilled engineers. Indeed, the advantage of firms competing in this space such as TradeBot, TradeWorx, and Getco comes from this infrastructure as most of the strategies that are developed are necessarily simple due to the latency requirements. Now if you expand the definition of HFT to include all computerized automated trading you most certainly can build strategies that are profitable. It is not something that you probably want to tackle on your own but I know of a couple of people that did go it alone successfully for a couple of years before joining an established firm to run a book for them. In order to be successful you will most likely need to develop a unique strategies. The good news is because that you are trying to deploy a very tiny amount of capital you can engage in trades that larger firms would not because the strategies cannot hold enough capital relative to the firms capital base. I am the co-founder of a small trading firm that successfully trades the US Equities and Equity Derivatives markets. A couple of things to note is that if you want to do this you should consider building a real business. Having some more smart brains around you will help. You don't need exchange colocation for all strategies. Many firms, including ours, colocate in a data center that simply has proximity to the exchanges data centers. You will need to keep things simple to be effective. Don't except all the group think that this is impossible. It is possible although as a single individual it will be more difficult. It will require long, long hours as you climb the algorithmic trading learning curve. Good luck.", "title": "" }, { "docid": "8be84e4133969ba6462f5fa6309b578b", "text": "About 10 years ago, I used to use MetaStock Trader which was a very sound tool, with a large number of indicators, but it has been a number of years since I have used it, so my comments on it will be out of date. At the time it relied upon me purchasing trading data myself, which is why I switched to Incredible Charts. I currently use Incredible Charts which I have done for a number of years, initially on the free adware service, now on the $10/year for EOD data access. There are quicker levels of data access, which might suit you, but I can't comment on these. It is web-based which is key for me. The data quality is very good and the number of inbuilt indicators is excellent. You can build search routines on the basis of specific indicators which is very effective. I'm looking at VectorVest, as a replacement for (or in addition to) Incredible Charts, as it has very powerful backtesting routines and the ability to run test portfolios with specific buy/sell criteria that can simulate and backtest a number of trading scenarios at the same time. The advantage of all of these is they are not tied to a particular broker.", "title": "" }, { "docid": "8f8f817d29980ea30187928d3c0747c2", "text": "Toronto is small relative to the states. Have you considered moving to NYC or even Chicago? Everyone seems to be wanting in right now. I know of a guy with a master's from the london school of economics, CFA level III who's just started as an unpaid intern(not me). You might be better off working a job wherein you actually produce something good for people to make money rather than just siphoning funds from others. Then you'll have funds to start your own trading unit with talented people you respect and trust.", "title": "" } ]	fiqa
4b6d72d79cc97709e6953fe5042b6d76	Investing Account Options	[ { "docid": "5768adeca0219e72d67ccb5dbb924ded", "text": "Immediately move your Roth IRA out of Edward Jones and into a discount broker like Scottrade, Ameritrade, Fidelity, Vanguard, Schwab, or E-Trade. Edward Jones will be charging you a large fraction of your money (probably at least 1% explicitly and maybe another 1% in hidden-ish fees like the 12b-1). Don't give away several percent of your savings every year when you can have an account for free. Places like Edward Jones are appropriate only for people who are unwilling to learn about personal finance and happy to pay dearly as a result. Move your money by contacting the new broker, then requesting that they get your money out of Edward Jones. They will be happy to do so the right way. Don't try and get the money out yourself. Continue to contribute to your Roth as long as your tax bracket is low. Saving on taxes is a critically important part of being financially wise. You can spend your contributions (not gains) out of your Roth for any reason without penalty if you want/need to. When your tax bracket is higher, look at traditional IRA's instead to minimize your current tax burden. For more accessible ways of saving, open a regular (non-tax-advantaged) brokerage account. Invest in diversified and low-cost funds. Look at the expense ratios and minimize your portfolio's total expense. Higher fee funds generally do not earn the money they take from you. Avoid all funds that have a nonzero 12b-1 fee. Generally speaking your best bet is buying index funds from Fidelity, Vanguard, Schwab, or their close competitors. Or buying cheap ETF's. Any discount brokerage will allow you to do this in both your Roth and regular accounts. Remember, the reason you buy funds is to get instant diversification, not because you are willing to gamble that your mutual funds will outperform the market. Head to the bogleheads forum for more specific advice about 3 fund portfolios and similar suggested investment strategies like the lazy portfolios. The folks in the forums there like to give specific advice that's not appropriate here. If you use a non-tax-advantaged account for investing, buy and sell in a tax-smart way. At the end of the year, sell your poor performing stocks or funds and use the loss as a tax write-off. Then rebalance back to a good portfolio. Or if your tax bracket is very low, sell the winners and lock in the gains at low tax rates. Try to hold things more than a year so you are taxed at the long-term capital gains rate, rather than the short-term. Only when you have several million dollars, then look at making individual investments, rather than funds. In a non-tax-advantaged account owning the assets directly will help you write off losses against your taxes. But either way, it takes several million dollars to make the transactions costs of maintaining a portfolio lower than the fees a cheap mutual/index fund will charge.", "title": "" } ]	[ { "docid": "1e3cdc7396f7f31fd63aa01e35c6083b", "text": "\"Roth is currently not an option, unless you can manage to document income. At 6, this would be difficult but not impossible. My daughter was babysitting at 10, that's when we started her Roth. The 529 is the only option listed that offers the protection of not permitting an 18 year old to \"\"blow the money.\"\" But only if you maintain ownership with the child as beneficiary. The downside of the 529 is the limited investment options, extra layer of fees, and the potential to pay tax if the money is withdrawn without child going to college. As you noted, since it's his money already, you should not be the owner of the account. That would be stealing. The regular account, a UGMA, is his money, but you have to act as custodian. A minor can't trade his own stock account. In that account, you can easily manage it to take advantage of the kiddie tax structure. The first $1000 of realized gains go untaxed, the next $1000 is at his rate, 10%. Above this, is taxed at your rate, with the chance for long tern capital gains at a 15% rate. When he actually has income, you can deposit the lesser of up to the full income or $5500 into a Roth. This was how we shifted this kind of gift money to my daughter's Roth IRA. $2000 income from sitting permitted her to deposit $2000 in funds to the Roth. The income must be documented, but the dollars don't actually need to be the exact dollars earned. This money grows tax free and the deposits may be withdrawn without penalty. The gains are tax free if taken after age 59-1/2. Please comment if you'd like me to expand on any piece of this answer.\"", "title": "" }, { "docid": "94ddf1032cb45bb5c777b866ae873592", "text": "\"I found your post while searching for this same exact problem. Found the answer on a different forum about a different topic, but what you want is a Cash Flow report. Go to Reports>Income & Expenses>Cash Flow - then in Options, select the asset accounts you'd like to run the report for (\"\"Calle's Checking\"\" or whatever) and the time period. It will show you a list of all the accounts (expense and others) with transactions effecting that asset. You can probably refine this further to show only expenses, but I found it useful to have all of it listed. Not the prettiest report, but it'll get your there.\"", "title": "" }, { "docid": "7513669b507e34a1436fd1b73c0e25b7", "text": "\"Here are the few scenarios that may be worth noting in terms of using different types of accounts: Traditional IRA. In this case, the monies would grow tax-deferred and all monies coming out will be taxed as ordinary income. Think of it as everything is in one big black box and the whole thing is coming out to be taxed. Roth IRA. In this case, you could withdraw the contributions anytime without penalty. (Source should one want it for further research.) Past 59.5, the withdrawals are tax-free in my understanding. Thus, one could access some monies earlier than retirement age if one considers all the contributions that are at least 5 years old. Taxable account. In this case, each year there will be distributions to pay taxes as well as anytime one sells shares as that will trigger capital gains. In this case, taxes are worth noting as depending on the index fund one may have various taxes to consider. For example, a bond index fund may have some interest that would be taxed that the IRA could shelter to some extent. While index funds can be a low-cost option, in some cases there may be capital gains each year to keep up with the index. For example, small-cap indices and value indices would have stocks that may \"\"outgrow\"\" the index by either becoming mid-cap or large-cap in the case of small-cap or the value stock's valuation rises enough that it becomes a growth stock that is pulled out of the index. This is why some people may prefer to use tax-advantaged accounts for those funds that may not be as tax-efficient. The Bogleheads have an article on various accounts that can also be useful as dg99's comment referenced. Disclosure: I'm not an accountant or work for the IRS.\"", "title": "" }, { "docid": "3a5e26a54c14df9789647c1dea47ee96", "text": "There are some brokers in the US who would be happy to open an account for non-US residents, allowing you to trade stocks at NYSE and other US Exchanges. Some of them, along with some facts: DriveWealth Has support in Portuguese Website TD Ameritrade Has support in Portuguese Website Interactive Brokers Account opening is not that straightforward Website", "title": "" }, { "docid": "fd7c234f7265e788866e04770fab0c5f", "text": "As an alternative to investing you'll find at least some banks eg. Rakuten that will give you preferential interest rates(still 0.1% though) just for opening a free brokering account. As this is still your individual savings account your money is as safe as it was before opening your account. I certainly wouldn't buy to hold any stock or fund that is linked to the Nikkei right now. Income stocks outside of the 225 may be safer, but you'd still need to buy enough of them that their individual results don't affect your bottom line.", "title": "" }, { "docid": "9035e3042845744753020ebe12989ddf", "text": "I can't provide a list, but when I took out my Stocks and Shares, I extensively researched for a good, cheap, flexible option and I went with FoolShareDealing. I've found them to be good, and their online trading system works well. I hope that's still the case.", "title": "" }, { "docid": "7fb2ffdbc44f0f39716c4966623450b3", "text": "\"First, you mentioned your brother-in-law has \"\"$100,000 in stock options (fully vested)\"\". Do you mean his exercise cost would be $100,000, i.e. what he'd need to pay to buy the shares? If so, then what might be the estimated value of the shares acquired? Options having vested doesn't necessarily mean they possess value, merely that they may be exercised. Or did you mean the estimated intrinsic value of those options (estimated value less exercise cost) is $100,000? Speaking from my own experience, I'd like to address just the first part of your question: Have you treated this as you would a serious investment in any other company? That is, have you or your brother-in-law reviewed the company's financial statements for the last few years? Other than hearing from people with a vested interest (quite literally!) to pump up the stock with talk around the office, how do you know the company is: BTW, as an option holder only, your brother-in-law's rights to financial information may be limited. Will the company share these details anyway? Or, if he exercised at least one option to become a bona-fide shareholder, I believe he'd have rights to request the financial statements – but company bylaws vary, and different jurisdictions say different things about what can be restricted. Beyond the financial statements, here are some more things to consider: The worst-case risk you'd need to accept is zero liquidity and complete loss: If there's no eventual buy-out or IPO, the shares may (effectively) be worthless. Even if there is a private market, willing buyers may quickly dry up if company fortunes decline. Contrast this to public stock markets, where there's usually an opportunity to witness deterioration, exit at a loss, and preserve some capital. Of course, with great risk may come great reward. Do your own due diligence and convince yourself through a rigorous analysis — not hopes & dreams — that the investment might be worth the risk.\"", "title": "" }, { "docid": "cc13c4bd1503bbb1b62c7955bea94d58", "text": "\"An alternative to a savings account is a money market account. Not a bank \"\"Money Market\"\" account which pays effectively the same silly rate as a savings account, but an actual Money Market investment account. You can even write checks against some Money Market investment accounts. I have several accounts worth about 13,000 each. Originally, my \"\"emergency fund\"\" was in a CD ladder. I started experimenting with two different Money market investment accounts recently. Here's my latest results: August returns on various accounts worth about $13k: - Discover Bank CD: $13.22 - Discover Bank CD: $13.27 - Discover Bank CD: $13.20 - Discover Savings: $13.18 - Credit Union \"\"Money Market\"\" Savings account: $1.80 - Fidelity Money Market Account (SPAXX): $7.35 - Vanguard Money market Account (VMFXX): $10.86 The actual account values are approximate. The Fidelity Money Market Account holds the least value, and the Credit Union account by far the most. The result of the experiment is that as the CDs mature, I'll be moving out of Discover Bank into the Vanguard Money Market account. You can put your money into more traditional equities mutual fund. The danger with them is the stock market may drop big the day before you want to make your withdrawl... and then you don't have the down payment for your house anymore. But a well chosen mutual fund will yield better. There are 3 ways a mutual fund increase in value: Here's how three of my mutual funds did in the past month... adjusted as if the accounts had started off to be worth about $13,000: Those must vary wildly month-to-month. By the way, if you look up the ticker symbols, VASGX is a Vanguard \"\"Fund of Funds\"\" -- it invests not 100% in the stock market, but 80% in the stock market and 20% in bonds. VSMGX is a 60/40 split. Interesting that VASGX grew less than VSMGX...but that assumes my spreadsheet is correct. Most of my mutual funds pay dividends and capital gains once or twice a year. I don't think any pay in August.\"", "title": "" }, { "docid": "f23e3365d2baf8d026f99b1755e53154", "text": "\"Trying to \"\"time the market\"\" is usually a bad idea. People who do this every day for a living have a hard time doing that, and I'm guessing you don't have that kind of time and knowledge. So that leaves you with your first and third options, commonly called lump-sum and dollar cost averaging respectively. Which one to use depends on where your preferences lie on the risk/reward scpectrum. Dollar cost averaging (DCA) has lower risk and lower reward than lump sum investing. In my opinion, I don't like it. DCA only works better than lump sum investing if the price drops. But if you think the price is going to drop, why are you buying the stock in the first place? Example: Your uncle wins the lottery and gives you $50,000. Do you buy $50,000 worth of Apple now, or do you buy $10,000 now and $10,000 a quarter for the next four quarters? If the stock goes up, you will make more with lump-sum(LS) than you will with DCA. If the stock goes down, you will lose more with LS than you will with DCA. If the stock goes up then down, you will lose more with DCA than you will with LS. If the stock goes down then up, you will make more with DCA than you will with LS. So it's a trade-off. But, like I said, the whole point of you buying the stock is that you think it's going to go up, which is especially true with an index fund! So why pick the strategy that performs worse in that scenario?\"", "title": "" }, { "docid": "120d3a55e9a0033859dcfe02e5756f69", "text": "You are suggesting something called dollar cost averaging (or its cousin, dollar value averaging) - http://www.investopedia.com/articles/stocks/07/dcavsva.asp This is certainly a valid investment strategy, although personally, I feel that for long term investment, it is not necessary unless you plan on being an active trader. I still strongly encourage you to research these two methods and see if they would work well for your personal investment strategy and goals. As far as what sorts of investments for a taxable account, I have three general recommendations: As far as which company to use for your brokerage, I personally have accounts at Voya, TRowe Price and Fidelity. I would strongly recommend Fidelity out of those three, mostly due to customer service and quality and ease of use of their website. Vanguard is a great brokerage, but you don't have to choose them just because you plan to mostly invest in Vanguard funds. I also recommend you research how capital gains and dividend taxing works (and things like lost harvesting), so that you can structure your investments with taxes in mind. Do this ahead of time, don't wait until April of 2016 because it will be too late to save on taxes by then.", "title": "" }, { "docid": "156ea79111ede80e9923c3ebe543a75e", "text": "I think that those options might well be your best bet, given the potential 700% return in one year if you're right. You could look and see if any Synthetic Zeros (a Synthetic Zero is a derivative that will pay out a set amount if the underlying security is over a certain price point) exist for the share but chances are if they do they wouldn't offer the 700% return. Also might be worth asking the question at the quant stack exchange to see if they have any other ideas.", "title": "" }, { "docid": "cabb237fffd7db5cb951c9fa74e91e1c", "text": "The easiest way to deal with risks for individual stocks is to diversify. I do most of my investing in broad market index funds, particularly the S&P 500. I don't generally hold individual stocks long, but I do buy options when I think there are price moves that aren't supported by the fundamentals of a stock. All of this riskier short-term investing is done in my Roth IRA, because I want to maximize the profits in the account that won't ever be taxed. I wouldn't want a particularly fruitful investing year to bite me with short term capital gains on my income tax. I usually beat the market in that account, but not by much. It would be pretty easy to wipe out those gains on a particularly bad year if I was investing in the actual stocks and not just using options. Many people who deal in individual stocks hedge with put options, but this is only cost effective at strike prices that represent losses of 20% or more and it eats away the gains. Other people or try to add to their gains by selling covered call options figuring that they're happy to sell with a large upward move, but if that upward move doesn't happen you still get the gains from the options you've sold.", "title": "" }, { "docid": "fb7489191787be6458bb24d48707cb7c", "text": "You are not limited in these 3 choices. You can also invest in ETFs, which are similar to mutual funds, but traded like stocks. Usually (at least in Canada), MERs for ETFs are smaller than for mutual funds.", "title": "" }, { "docid": "f50607ffadab1c7bacb18fce2adec8de", "text": "\"The way I've implemented essentially \"\"value averaging\"\", is to keep a constant ratio between different investment types in my portfolio. Lets say (in a simple example), 25% cash, 25% REIT (real estate), 25% US Stock, 25% Foreign stock. Lets say I deposit a set $1000 per month into this account. If the stock portion goes up, it will look like I need more cash & REIT, so all of that $1000 goes into cash & the REIT portion to get them towards their 25%. I may spend months investing only in cash & the REIT while the stock goes up. Of course if the stock goes down, that $1000 per month goes into the stock accounts. Now you can also balance your account if you'd like, regularly selling stock (or the REIT), and making the account balanced. So if the stock goes down, you'd use the cash & REIT to purchase more stock. If the stock went up, you'd sell the stock, and buy REIT & leave more in cash.\"", "title": "" }, { "docid": "685f41d0666957a5964f2687f3f79aee", "text": "\"The \"\"Yield Pledge\"\" looks like a marketing promise to me. It may well be true, but I'm not sure it's useful. As you say, it's currently not the best account out there. If those extra $24 per $10000 are really important to you, why not do your own analysis? Put the money in the highest interest account you can find, and then every three months survey the accounts available and, if it isn't still the highest, transfer the funds to the one that is. Personally I wouldn't put that much effort in for $24, but you may be different.\"", "title": "" } ]	fiqa
371e704e9e59b8d7d8e0fd3af1e3e3de	How do I apply for a mortgage after a cash closing on a property?	[ { "docid": "b65061af07fa3aa550a3bee5c4c8e631", "text": "Is she correct in that you generally can't even apply until the cash transaction is complete? Probably. How can you commit to mortgage something you do not own? Makes sense for them to wait not even until the transaction is complete - but until the transaction is recorded. Is 45 days reasonable to complete the financing? Yes.", "title": "" } ]	[ { "docid": "381563a5ff5f8c8db9c154df4fd540d0", "text": "Run the numbers in advance. Understand what are the current rates for an additional 2nd mortgage, what are the rates for a brand new mortgage that will cover the additional funds. Understand what they are for another lender. Estimate the amount of paperwork involved in each option (new first, new 2nd, and new lender). Ask the what are the options they can offer you. Because you have estimated the costs in money and time for the different options, you can evaluate the offer they make. What they offer you can range from everything you want to nothing you would accept. What they offer will depend on several factors: Do they care to keep you as a customer?; Do they expect you to walk away?; are they trying to get rid of mortgages like the one you have?; Can they make more money with the plan they are offering you? You will be interested in the upfront costs, the monthly costs, and the amount of time required for the process to be completed.", "title": "" }, { "docid": "1858b3c8010825e42d07a2ea2b053640", "text": "why not ask a fee only financial adviser? Contact a local adviser and ask how much they will charge to work through the process. The options aren't as complex as they seem. The general idea is to first figure out what you can afford each month. This is a generally straight forward calculation. Then figure out the costs that are specific to your area, e.g property taxes. Figure out how much of a down payment /closing costs you can gather. Then start with your local bank or credit union. The number of options for mortgages will not be as complex if you already know how much you can afford and how much cash you can bring to the transaction. A simple table can be easily created based on what you can afford each month, how much cash you have, and the rates currently available. The bank will have a way to estimate the costs of each option as part of the required disclosures. Another source of good info can be a highly regarded local real estate agent. Focus on one that will represent you as a purchaser. They want you to be able to buy a house. While they do have a bias, they want a commission, most of it is eliminated if you know how much you can afford before you meet with them. They will know all the government programs that can make the monthly costs or closing costs cheaper.", "title": "" }, { "docid": "e042485852dc24651d7e8ebc3a6289e4", "text": "\"Yes, a HELOC is great for that. I just had my roof done last month (~$15K, \"\"ugh\"\") and pretty much every major contractor in my area had a 0% same-as-cash for at least 12 months. So that helps - any balance that I don't bank by 11/15/2015 will be on the HELOC.\"", "title": "" }, { "docid": "febd8fd807124b45ff926beb8203609a", "text": "You're talking about porting your mortgage, which may be possible if your mortgage was portable to start with, or if your bank subsequently allows it. Note that although porting a mortgage involves keeping most of the original terms and conditions, the process is still much like applying for a new mortgage, including any lending requirements. Here's an article on the subject. EDIT: In response to OP's comment below: What will happen to the first property if I don't sell it? Because porting a mortgage is treated as if you were closing one mortgage and opening a new one, this means that you would need to pay off the first mortgage. Typically this would be done by selling the first property at the same time that you buy the second one. However, if you're not doing this, you'll need to raise funds another way, which could include opening a new mortgage on the first property (of course, if you're doing that, then there would have to be a good reason for porting the original mortgage; otherwise you might as well leave it where it is, and open a new mortgage on the second property instead). Does the article apply the to USA too? That article (and indeed this answer) are based on the situation in the UK. However, they appear to exist in the US too, though are rarer than in the UK.", "title": "" }, { "docid": "239eefd27af2f242572ffc8aa02b5f83", "text": "It is highly unlikely that this would be approved by a mortgage underwriter. When the bank gives a loan with a security interest in a property (a lien), they are protected - if the borrower does not repay the loan, the property can be foreclosed on and sold, and the lender is made whole for the amount of the loan that was not repaid. When two parties are listed on the deed, then each owns an UNDIVIDED 50% share in the property. If only one party has pledged the property as surety against the loan, then in effect only 50% of the property is forecloseable. This means that the bank is unable to recoup its loss. For a (fictional, highly simplified) concrete example, suppose that the house is worth $100,000 and Adam and Zoe are listed on the deed, but Adam is the borrower for a $100,000 mortgage. Adam owes $100,000 and has an asset worth $50,000 (which he has pledged as security for the loan), while Zoe owes nothing and has an asset worth $50,000 (which is entirely unencumbered). If Adam does not pay the mortgage, the bank would only be able to foreclose on his $50,000 half of the property, leaving them exposed to great risk. There are other legal and financial reasons, but overall I think you'll find it very difficult to locate a lender who is willing to take that kind of risk. It's very complicated and there is absolutely no up-side. Also - speaking from experience (from which I was protected because of the bank's underwriting rules) and echoing the advice offered by others on this site: don't bother trying. Commingling assets without a contract (either implicit by marriage or explicit by, well a contract) is going to get you in trouble.", "title": "" }, { "docid": "450c8ae1359a23cf337b1a1817dd9c03", "text": "What options do I have? Realistically? Get a regular full time job. Work at it for a year or so and then see about buying a house. That said, I recently purchased a decent home. I am self-employed and my income is highly erratic. Due to how my clients pay me, my business might go a couple months with absolutely no deposits. However, I've been at this for quite a few years. So, even though my business income is erratic, I pay myself regularly once a month. In order to close the deal with the mortgage company I had to provide 5 years worth of statements on my business AND my personal bank accounts. Also I had about a 30% down payment. This gave the bank enough info to realize that I could absolutely make the payments and we closed the deal. I'd say that if you have little to no actual financial history, don't have a solid personal income and don't have much of a down payment then you probably have no business buying a house at this point. The first time something goes wrong (water heater, ac, etc) you'll be in a world of trouble.", "title": "" }, { "docid": "298a3463016470759c63b56f5d689734", "text": "What you are suggesting will not work. Banks have strict guidelines about what they can and cannot do with an FHA loan property. Remember the FHA is only an insurance policy to the bank saying that if you default they will cover a high percentage of the loan. The bank won't take the risk of violating their insurance policy and the government refusing to pay them off if you default. Instead, consider doing a creative sale on your property, maybe a rent to own deal or owner financing. As long as you pay the mortgage the bank won't even know you don't live there and you can rent the house out to someone who eventually will buy it after the timeframe expires. Meanwhile you can go and get a new home or condo either thru regular financing or owner financing(search the internet to see how to do this) and you can use owner financing until you complete the sale of the first house. Otherwise just tough it out in the house you are in until the time expires and then sell. You made no mention of the property value but I am assuming if you bought it 3 years ago that you may have a little equity. Pleas note that if you sell at that time though you will likely have to come out of cash because your equity won't cover the realtor fee and closing cost. But if you do the rent to own I suggested earlier you can sell at a slightly higher price making sure you can cover those cost. I realize this answer is a little out the box but I deal with people who don't want properties all day and I have completed transactions like this many times. Good Luck and God Bless!", "title": "" }, { "docid": "f4337f65c2c443100a3f1bce1ce7805c", "text": "Your wealth will go up if your effective rate after taxes is less than the inflation rate. That is, if your interest rate is R and marginal tax rate is T, then you need R*(1-T) to be less than inflation to make a loan worth it. Lately inflation has been bouncing around between 1% and 1.8%. Let's assume a 25% tax rate. Is your interest rate lower than between 1.3% and 2.4%? If not, don't take out a loan. Another thing to consider: when you take out a loan you have to do a ton of extra stuff to make the lender happy (inspections, appraisals, origination charges, etc.). These really add up and are part of the closing costs as well as the time/trouble of buying a house. I recently bought my house using 100% cash. It was 2 weeks between when I agreed to a price to when the deal was sealed and my realtor said I probably saved about $10,000 in closing costs. I think she was exaggerating, but it was a lot of time and money I saved. My final closing costs were only a few hundred, not thousands, of dollars. TL;DR: Loans are for suckers. Avoid if possible.", "title": "" }, { "docid": "bc29100c3e89b4db2e5cfe70a2a70094", "text": "The loan you will just have to get by applying to a bunch of banks or hiring someone (a broker) to line up bank financing on your behalf for a point on the loan. FHA is for your first house that you live in and allows you to get 97.5% loan to cost financing. That isn't for investment properties. However, FHA loans do exist for multifamily properties under section 207/223F. Your corporations should be SPEs so they don't affect each other. In the end, its up to you if you think it makes sense for all the single family homes to be in one portfolio. May make it easier to refi if you put all the properties in a cross collateralized pool for the bank to lend against. There is also no requirement for how long a corporation has been in existence for a loan. The loan has a claim on the property so it's pretty safe. So long as you haven't committed fraud before, they won't care about credit history.", "title": "" }, { "docid": "3b498a3b868051d17051ad4afba1afd2", "text": "You submitted a claim for damage to the deck. The insurance company notified the mortgage company. Now the mortgage company wants to make sure that the collateral for the loan is still in good condition. They want you to make the repairs that you insisted needed to be done. They may even require you to use a licensed contractor before releasing the funds. Once you own the house without a mortgage, then you can decide for yourself if minor repairs need to be done.", "title": "" }, { "docid": "73deb8ce59c254ab3f7158df06349e47", "text": "\"Not unless you have something else to put up as collateral. The bank wants a basic assurance that you're not going to immediately move the money to the Caymans and disappear. 999 times out of 1000, the collateral for a home mortgage is the home itself (which you wouldn't be able to take with you if you decided to disappear), so signing up for a 30 year mortgage on a nonexistent house is probably going to get you laughed out of the bank. It's sometimes possible to negotiate something else as collateral; you may, for instance, have a portfolio of securities worth the loan principal, that you can put in escrow for the term of the loan (the securities will stay in your name and make you money, but if you default on the loan the bank goes to the escrow company and takes the portfolio for their own). The bank will consider the risk of value loss on the securities in the portfolio, and may ask for a higher collateral value or only allow a lower loan amount. In all cases, it's usually a bad idea to go into long-term personal debt just to get \"\"cheap money\"\" that you can use to beat the interest rate with some business plan or investment. If you have a business plan, take that to the bank with an LLC and ask for a business loan. The business itself, if the plan is sound, should become valuable, and the terms of business loans take that into account, allowing for a \"\"shrinking collateral\"\" transferring the initial personal risk of the loan to the business.\"", "title": "" }, { "docid": "26d1fa0919c5d0cd9e23e44fd94ee05e", "text": "yeah, i get that it's not optional. just sucks that nothing has changed substantially since i closed on the loan 11 months ago (same PMI, same HO, essentially the same property taxes) and now i have to pay more. seems like the closing docs could have taken into account timing of those payments so that i primed the pump with enough from the beginning.", "title": "" }, { "docid": "97c33aa8e668fb4aae4bbdd1108233f1", "text": "\"In your particular condition could buy the condo with cash, then get your mortgage on your next house with \"\"less than 20%\"\" down (i.e. with mortgage insurance) but it would still be an owner occupied loan. If you hate the mortgage insurance, you could save up and refi it when you have 20% available, including the initial down payment you made (i.e. 80% LTV ratio total). Or perhaps during the time you live in the condo, you can save up to reach the 20% down for the new house (?). Or perhaps you can just rent somewhere, then get into the house for 20% down, and while there save up and eventually buy a condo \"\"in cash\"\" later. Or perhaps buy the condo for 50% down non owner occupied mortgage... IANAL, but some things that may come in handy: you don't have to occupy your second residence (owner occupied mortgage) for 60 days after closing on it. So could purchase it at month 10 I suppose. In terms of locking down mortgage rates, you could do that up to 3 months before that even, so I've heard. It's not immediately clear if \"\"rent backs\"\" could extend the 60 day intent to occupy, or if so by how long (1 month might be ok, but 2? dunno) Also you could just buy one (or the other, or both) of your mortgages as a 20% down conventional \"\"non owner occupied\"\" mortgage and generate leeway there (ex: buy the home as non owner occupied, and rent it out until your year is up, though non owner occupied mortgage have worse interest rates so that's not as appealing). Or buy one as a \"\"secondary residency\"\" mortgage? Consult your loan officer there, they like to see like \"\"geographic distance\"\" between primary and secondary residences I've heard. If it's HUD (FHA) mortgage, the owner occupancy agreement you will sign is that you \"\"will continue to occupy the property as my primary residence for at least one year after the date of occupancy, unless extenuating circumstances arise which are beyond my control\"\" (ref), i.e. you plan on living in it for a year, so you're kind of stuck in your case. Maybe you'd want to occupy it as quickly as possible initially to make the year up more quickly :) Apparently you can also request the lender to agree to arbitrarily rescind the owner occupancy aspect of the mortgage, half way through, though I'd imagine you need some sort of excuse to convince them. Might not hurt to ask.\"", "title": "" }, { "docid": "97346439b9bda6cb87eaf6f87a228137", "text": "Keep in mind that lenders will consider the terms of any loans you have when determining your ability to pay back the mortgage. They'll want to see paperwork, or if you claim it is a gift they will require a letter to that effect from your relative. Obviously, this could effect your ability to qualify for a loan.", "title": "" }, { "docid": "b381fce7dd29bb532e1caeb0c23caf36", "text": "\"Let me summarize your question for you: \"\"I do not have the down payment that the lender requires for a mortgage. How can I still acquire the mortgage?\"\" Short answer: Find another lender or find more cash. Don't overly complicate the scenario. The correct answer is that the lender is free to do what they want. They deem it too risky to lend you $1.1M against this $1.8M property, unless they have $700k up front. You want their money, so you must accept their terms. If other lenders have the same outlook, consider that you cannot afford this house. Find a cheaper house.\"", "title": "" } ]	fiqa
264338fdc9dee1cd45ae6531dc59b364	Options for the intelligent but inexperienced	[ { "docid": "b09a51e84be825a7bd9b5dd31aee855c", "text": "\"Some thoughts on your questions in order, Duration: You might want to look at the longest-dated option (often a \"\"LEAP\"\"), for a couple reasons. One is that transaction costs (spread plus commission, especially spread) are killer on options, so a longer option means fewer transactions, since you don't have to keep rolling the option. Two is that any fundamentals-based views on stocks might tend to require 3-5 years to (relatively) reliably work out, so if you're a fundamental investor, a 3-6 month option isn't great. Over 3-6 months, momentum, short-term news, short squeezes, etc. can often dominate fundamentals in determining the price. One exception is if you just want to hedge a short-term event, such as a pending announcement on drug approval or something, and then you would buy the shortest option that still expires after the event; but options are usually super-expensive when they span an event like this. Strike: Strike price on a long option can be thought of as a tradeoff between the max loss and minimizing \"\"insurance costs.\"\" That is, if you buy a deeply in-the-money put or call, the time value will be minimal and thus you aren't paying so much for \"\"insurance,\"\" but you may have 1/3 or 1/2 of the value of the underlying tied up in the option and subject to loss. If you buy a put or call \"\"at the money,\"\" then you might have only say 10% of the value of the underlying tied up in the option and subject to loss, but almost the whole 10% may be time value (insurance cost), so you are losing 10% if the underlying stock price stays flat. I think of the deep in-the-money options as similar to buying stocks on margin (but the \"\"implied\"\" interest costs may be less than consumer margin borrowing rates, and for long options you can't get a margin call). The at-the-money options are more like buying insurance, and it's expensive. The commissions and spreads add significant cost, on top of the natural time value cost of the option. The annual costs would generally exceed the long-run average return on a diversified stock fund, which is daunting. Undervalued/overvalued options, pt. 1: First thing is to be sure the options prices on a given underlying make sense at all; there are things that \"\"should\"\" hold, for example a synthetic long or short should match up to an actual long or short. These kinds of rules can break, for example on LinkedIn (LNKD) after its IPO, when shorting was not permitted, the synthetic long was quite a bit cheaper than a real long. Usually though this happens because the arbitrage is not practical. For example on LNKD, the shares to short weren't really available, so people doing synthetic shorts with options were driving up the price of the synthetic short and down the price of the synthetic long. If you did actually want to be long the stock, then the synthetic long was a great deal. However, a riskless arbitrage (buy synthetic long, short the stock) was not possible, and that's why the prices were messed up. Another basic relationship that should hold is put-call parity: http://en.wikipedia.org/wiki/Put%E2%80%93call_parity Undervalued/overvalued options, pt. 2: Assuming the relationship to the underlying is sane (synthetic positions equivalent to actual positions) then the valuation of the option could focus on volatility. That is, the time value of the option implies the stock will move a certain amount. If the time value is high and you think the stock won't move much, you might short the option, while if the time value is low and you think the stock will move a lot, you might buy the option. You can get implied volatility from your broker perhaps, or Morningstar.com for example has a bunch of data on option prices and the implied components of the price model. I don't know how useful this really is though. The spreads on options are so wide that making money on predicting volatility better than the market is pretty darn hard. That is, the spread probably exceeds the amount of the mispricing. The price of the underlying is more important to the value of an option than the assumed volatility. How many contracts: Each contract is 100 shares, so you just match that up. If you want to hedge 100 shares, buy one contract. To get the notional value of the underlying multiply by 100. So say you buy a call for $30, and the stock is trading at $100, then you have a call on 100 shares which are currently priced at $10,000 and the option will cost $30100=3,000. You are leveraged about 3 to 1. (This points to an issue with options for individual investors, which is that one contract is a pretty large notional value relative to most portfolios.)\"", "title": "" }, { "docid": "52783402987434f0dd77f7695b1e7b03", "text": "\"I strongly suggest you read up the Option Greeks. You can be right about a stocks price movement and still not make money b/c other factors come into play from time or volatility. For a \"\"free\"\" option hedge you can look at collars. Buying puts and selling calls to offset the debit you pay for the transaction. Ex: AAPL is 115, You buy the 110 puts and sell the 120 calls. This gives you a collar around he current price. Your hedged below 110 and can still participate in upside move to 120. Also look into time value. Time decays exponentially in the last 30 days. If you are long this hurts you, if you are short(selling) this is good. Be sure to take this into account. Delta: relation of the option to the underlying stock move on a .01-1 scale, .50 is \"\"normal.\"\" Deep in the money options have higher deltas. It is possible other factors can offset this delta move. This is why people will lose money on earnings plays even though they are right. EX: Say you buy an AAPL call at 120, earnings comes out and the stock goes to 121. Even though you are \"\"in the money\"\" your contract may still have less value than what you paid because of VOLATILITY collapse. The market place knows earnings move a stock and that is factored into the price of the options expected volatility. As mentioned watch out for dividend dates. Always be aware of dividend dates and earnings dates and if your contract is going to cover one of these events. Interest rates have an effect as well but since the Fed has near 0 rates there is little impact at the present. Though this could certainly change if the fed starts raising rates. Research the Black Scholes Pricing model. Whenever you trade always think about what the other guys is thinking. Sometimes we forget their is someone else on the other side of my trade that thinks essentially the exact opposite of me. Its a zero sum game. As far as choosing strikes you can look at calculating the At THe money straddle to see if the options are \"\"cheap\"\" [stock Price Implied Volatility (for 30, 60, 90 days Depending on your holding period)* Sq root of days to expiration] / 19 (which is sq root of days/yr) Add and subtract this number to the current stock price to give you an approximate 1 standard deviation of expected price movement. Keeping with our example. AAPL at 115, lets say your formula spits out a 6; therefore price range is expected to be 109 to 121 for the time period. Helpful for selling options, I would sell the 122 call or the 108 puts. Hope this helps. Start small and get a feel for things.\"", "title": "" }, { "docid": "9bd15c1001b57459bb29d361ded4fa40", "text": "\"Realize this is almost a year old, but I just wanted to comment on something in Dynas' answer above... \"\"Whenever you trade always think about what the other guys is thinking. Sometimes we forget their is someone else on the other side of my trade that thinks essentially the exact opposite of me. Its a zero sum game.\"\" From a market maker's perspective, their primary goal is not necessarily to make money by you being wrong, it is to make money on the bid-offer spread and hedging their book (and potentially interalize). That being said, the market maker would likely be quoting one side of the market away from top of the book if they don't want to take exposure in that direction (i.e. their bid will be lower than the highest bid available or their offer higher than the lowest offer available). This isn't really going to change anything if you're trading on an exchange, but important to consider if you can only see the prices your broker/dealer provides to you and they are your counterparty in the trade.\"", "title": "" } ]	[ { "docid": "953998066744ca70bd3d52152d186a3a", "text": "\"If you are interested in a career in algorithmic trading, I strongly encourage you to formally study math and computer science. Algorithmic trading firms have no need for employees with financial knowledge; if they did, they'd just be called \"\"trading\"\" firms. Rather, they need experts in machine learning, statistical modeling, and computer science in general. Of course there are other avenues of employment at an algorithmic trading firm, such as accounting, clearing, exchange relations, etc. If that's the sort of thing you're interested in, again you'll probably want a formal education in those areas as opposed to just reading about finance in the news. If you edit your question or add a comment below with information about your particular background, I could perhaps advise you in a bit more detail. ::edit:: Given your comment, I would say you have a fine academic background for the industry. When hiring mathematicians, firms care most about the ease with which you can explore and extract features from massive datasets (especially time series) regardless of what the dataset might represent. An intelligent firm will not care whether you arrive at their doorstep with zero finance knowledge; they will want to teach you everything from scratch anyway. Nonetheless, some domain knowledge could be helpful, but you're not going to get \"\"more\"\" of it from reading any mass market news source, whether you have to pay for it or not. That's because Some non-mass-market news sources in the industry are These are subscription-only and actually discuss real information that real professional investors care about. They are loaded with industry jargon, they're extremely opinionated, and (in my opinion) they're useless. I can't imagine trying to learn about the industry from them, but if you want to spend money for news in order to be exposed to the innards of the industry, then either of these is far better than the Financial Times. Despite requiring a subscription, the Financial Times still does not cover the technical details of professional trading. Instead of trying to learn from news, then, I would suggest some old favorites: and, above all else, Read everything in the navigation box on the right side under Financial Markets and Financial Instruments.\"", "title": "" }, { "docid": "4f741b5e69fc8bdf210951b55a0ed4c7", "text": "There are some useful comments about the tradeoffs of the decisions in front of you. Intertwined with the financial choices, hopefully you can see a map opening up. Make a little chart if it helps. Benefit and Cost. If you're looking for financial options, you will have to also add more columns to that chart: Option and Cost. An example is the comment on making connections with rich kids. Trust fund babies are everywhere in this country. Did you know any rich kids while growing up? How were those rich kids you knew of back then... in your school... in your town? How did they treat you? Were you ever invited to their parties or gatherings? Now there's an opportunity for the privilege to pay a lot of money to sit in a classroom next to them? Even in the early days of American history with merit based millionaires... tycoons who made it rich by the seat of their pants. At fancy dinner parties and soirees, a new term emerged to put each other again out of reach: old money (the deserving) and new money (uncultured climbers). That's my bias. You'll have some of your own. What is important to YOU has to come through because these days, the price tag of any higher education implies a considerable piece of your life's timeline will be committed to... something. Make sure you get what you feel is worth that commitment. Take stock of what has been said here by the others, but put a value on those choices and seriously consider what you're willing to pay for... and what you're not. There is no formula for your success as there's been thousands of exceptions... ESID (Every Situation is Different).", "title": "" }, { "docid": "db1ccbc57a778e7a93f06a6a95ab0dde", "text": "\"Consultant, I commend you for thinking about your financial future at such an early age. Warren Buffet, arguably the most successful investor ever lived, and the best known student of Ben Graham has a very simple advice for non-professional investors: \"\"Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard’s.)\"\" This quote is from his 2013 letter to shareholders. Source: http://www.berkshirehathaway.com/letters/2013ltr.pdf Buffet's annual letters to shareholders are the wealth of useful and practical wisdom for building one's financial future. The logic behind his advice is that most investors cannot consistently pick stock \"\"winners\"\", additionally, they are not able to predict timing of the market; hence, one has to simply stay in the market, and win over in the long run.\"", "title": "" }, { "docid": "7b5cb58c5f2d201684accde84c22a384", "text": "I would suggest equity research, or as mentioned, consulting. You could go into IB. Your main hindrance is your age, how long has it been since you finished your PhD? Equity Research: you will analyze companies, on an individual and micro basis, and provide macro point of views on the industry etc. Sales/Trading: you will not get a job in trading, sales...maybe, if you get a bank large enough that has a healthcare/industrial chemicals sales positions, but this is a job that requires you to be able to sell your bank's point of view to large, very sophisticated clients, and provide them with better ideas than other sales guys, so that they will trade with your bank...can you learn finance and the industry fast enough? You would be better off working in a buy side shop (there are tons in boston) IB: never met anyone that likes ib. depends on the bank but even mid market small banks it is 80hr weeks on avg. bulge bracket its 100. but you would likely start as an associate, (if at all) so that would go down really fast, (3-5 yrs to vp) If you went to a top tier school, find alum from your school that work at banks and talk to them first, a 30 min conversation with anyone is incredibly useful. Just ask them how to get in. Also make sure you know all the capital markets firms in your area, know what all the fields are from a basic level (read the shit on wallstreetoasis etc) so that you dont waste time when talking to people. You will likely need a CFA level 1 to get any traction, unless you can find some people that are willing to pull for you, which you will find is actually more simple than it seems - people love helping their alma matter, and every firm is always looking for smart people. anyways, sign up for the december 2012 cfa exam, and download/buy the schweser notes (don't read the actual books) this will be a great refresher about finance and economics even if you don't end up switching careers. actual answers to your questions 1) yes 2) start as an associate in ib, spend 3 years doing bs, and workin average 90hrs a week, either quit of become vp and start selling work vs doing it 3) ib: immediate sales/trading: immediate, buy side: varies on the firm, size, performance, could be immediate, could be the year after, or you could get fired after 3 months because your phd isnt as useful as they thought it was. 4) mentioned above...a few years, its managable, suck it up 5) no sorry goodluck", "title": "" }, { "docid": "1669fbab3ed90f4ba241a6bf435ff3a1", "text": "Sir, although I am quiet inexperienced speaking in this subject but being an undergraduate in financial engineering, I feel the title is suited very well since providing unbiased financial advice is the last and greatest thing that any financial adviser would ever do....", "title": "" }, { "docid": "bc6465a444d8872f0a0363390dbde207", "text": "\"Good ones, no there are not. Go to a bookstore and pick up a copy of \"\"The Intelligent Investor.\"\" It was last published in 1972 and is still in print and will teach you everything you need to know. If you have accounting skills, pick up a copy of \"\"Security Analysis\"\" by Benjamin Graham. The 1943 version was just released again with a 2008 copyright and there is a 1987 version primarily edited by Cottle (I think). The 1943 book is better if you are comfortable with accounting and the 1987 version is better if you are not comfortable and feel you need more direction. I know recent would seem better, but the fact that there was a heavy demand in 2008 to reprint a 1943 book tells you how good it is. I think it is in its 13th printing since 2008. The same is true for the 72 and 87 book. Please don't use internet tutorials. If you do want to use Internet tutorials, then please just write me a check now for all your money. It will save me effort from having to take it from you penny by penny because you followed bad advice and lost money. Someone has to capture other people's mistakes. Please go out and make money instead. Prudence is the mother of all virtues.\"", "title": "" }, { "docid": "2f52779e86c41a2c55e803a4aece668e", "text": "Out of curiosity, where do you get your news? Had I been asked to explain the two crises, I have no doubt that I would fail horrifically. You seem to explain everything quite concisely. I assume part of it is innate intelligence, but it can't hurt to have a good news source either.", "title": "" }, { "docid": "06cabc9409ed479bef4f066363863dbb", "text": "\"Most articles on investing recommend that investors that are just starting out to invest in index stock or bonds funds. This is the easiest way to get rolling and limit risk by investing in bonds and stocks, and not either one of the asset classes alone. When you start to look deeper into investing there are so many options: Small Cap, Large Cap, technical analysis, fundamental analysis, option strategies, and on and on. This can end up being a full time job or chewing into a lot of personal time. It is a great challenge to learn various investment strategies frankly for the average person that works full time it is a huge effort. I would recommend also reading \"\"The Intelligent Asset Allocator\"\" to get a wider perspective on how asset allocation can help grow a portfolio and reduce risk. This book covers a simple process.\"", "title": "" }, { "docid": "91531f9f9d19837f1ed28ee8d8142eb3", "text": "Be cognizant of your own limitations when approaching this material. I've dealt with lawyers, doctors, engineers and other highly intelligent people from other disciplines, who then try to learn about companies and the stock market. Their own arrogance and assumption that they can just learn anything quickly ends up hurting them. It can take years and real classical training of finance to understand this material with any depth. Someone is wrong (a fool) in every trade. There is someone who is going to make money and lose money. Odds are the fool is you.", "title": "" }, { "docid": "4ca0852fdce161b965d5715975eb9a33", "text": "\"As foundational material, read \"\"The Intelligent Investor\"\" by Benjamin Graham. It will help prepare you to digest and critically evaluate other investing advice as you form your strategy.\"", "title": "" }, { "docid": "1b108040bd2c34ec920bd9d6ec5d7bbd", "text": "My plan is that one day I can become free of the modern day monetary burdens that most adults carry with them and I can enjoy a short life without these troubles on my mind. If your objective is to achieve financial independence, and to be able to retire early from the workforce, that's a path that has been explored before. So there's plenty of sources that you might want to check. The good news is that you don't need to be an expert on security analysis or go through dozens of text books to invest wisely and enjoy the market returns. This is the Bogleheads philosophy. It's widely accepted by people in academia, and thoroughly tested. Look into it further if you want to see the rationale behind, but, to sum it up: It doesn't matter how expert you are. The idea of beating the market, that an index fund tracks, is about 'outsmarting' the rest of investors. That would be difficult, even if it was a matter of skill, but when it comes to predicting random events we're all equally clueless. *Total Expense Ratio: It gives an idea of how expensive is a given fund in terms of fees. Actively managed funds have higher TER than indexed ones. This doesn't mean there aren't index funds with, unexplainable, high TER out there.", "title": "" }, { "docid": "44077fb0ac4a093238d3b4ae8f86501b", "text": "Listen, I planted a seed in your head that will grow into intelligent thinking. You can do it. As an alternative to believing me (since I'm so ignorant) just read a LOT more. But don't just read CNN.", "title": "" }, { "docid": "3f4d2782016a99449f0364ecead401b2", "text": "https://www.google.ca/amp/s/amp.businessinsider.com/most-important-finance-books-2017-1 Bloomberg, finacial times, chat with traders, calculated risk, reuters, wsj, cnbc(sucks), bnn (if canadian) Audio books on youtube helped me read a lot of finance books in a short amount of time, listen while working out. One thing that helped me stand out at my student terms (4th year here) was learning outside of the classroom and joining an investment club. Learning programming can help if thats a strength, but its really not needed and it can waste time if yoi wont reach a point to build tools. Other than that at 18 you have more direction than i did, good luck!", "title": "" }, { "docid": "18fdf9e3dfc67a60abdd1702ae7f00b6", "text": "Start at Investopedia. Get basic clarification on all financial terms and in some cases in detail. But get a book. One recommendation would be Hull. It is a basic book, but quite informative. Likewise you can get loads of material targeted at programmers. Wilmott's Forum is a fine place to find coders as well as finance guys.", "title": "" }, { "docid": "ba6dfeb344202e59f5c6b285133567aa", "text": "A couple of good books I enjoyed and found very understandable (regarding the stock market): As for investment information you can get lost for days in Investopedia. Start in the stock section and click around. The tutorials here (free) give a good introduction to different financial topics. Regarding theoretical knowledge: start with what you know well, like your career or your other interests. You'll get a running start that way. Beyond that, it depends on what area of finance you want to start with. If it's your personal finances, I and a lot of other bloggers write about it all the time. Any of the bloggers on my blogroll (see my profile for the link) will give you a good perspective. If you want to go head first into planning your financial life, take a look at Brett Wilder's The Quiet Millionaire. It's very involved and thorough. And, of course, ask questions here.", "title": "" } ]	fiqa
4e9ef8e80a39360bf738dbe0d111e081	Settling house with husband during divorce. Which of these two options makes the most sense?	[ { "docid": "3b7e286509b8e3deab7cbf57c9657933", "text": "Both are close, but two notes - amiable or not, I'd rather have a deal that ends now, and nothing is hanging over my head to get or pay money on a future sale. 401(k) money is usually pre-tax, so releasing me from $10K of home equity is of more value than the $10K in a 401(k) that would net me $7K or so. As I commented to Joe, I'd focus on valuation. If your house is similar to those in the neighborhood, you might easily value it. If unique, the valuation may be tough. I'd spend a bit on an appraiser or two.", "title": "" }, { "docid": "302ff94541610d094a190bec9d6a88c4", "text": "Both seem to be reasonable. To decide you need to guess if the value of the house will go up or down between now and when you sell. If you think the value will go up - reach a calculation agreement now. If you think the value will go down - wait until the house is actually sold. So ya pays yer money, and ya takes yer chances... I think I understand the two scenarios Unless you are absolutely confident that you understand both scenarios - make sure your lawyer gets involved and explains them to you until you do understand.", "title": "" }, { "docid": "012a9f77a5a2d97bf5f1a814a166c0dc", "text": "How about a third approach: Figure the buyout as above. Figure what percentage of the value of the house the buyout constitutes. When the house sells the other party gets that percentage of the sales price.", "title": "" } ]	[ { "docid": "a1ebbc5a056464b41ab9e59830944367", "text": "\"You are \"\"pool[ing] the sales from both houses as downpayment on the new house.\"\" But they are going to pay you rent. Your question as it stands, just opens more questions. What, exactly is the ownership of the new house? If your's (and your wife's) was the money a gift? Ignoring the gift, if that's what it is, and if the in-law suite is 25% of the house value, you have a rental. You claim 25% of the expenses, including property tax and mortgage interest, along with 25% of the utilities, unless their part has its own meters. That's a start, if you add details, I may edit my answer. (Not to be pedantic, but whose parents are they. They can't be \"\"our in-laws,\"\" can they?)\"", "title": "" }, { "docid": "f0e42866e18ab51395e88ba021614b7d", "text": "I'm not going to speculate on the nature of your relationship with your wife, but the fact that you are worried about what would happen in the event of a divorce is a bit concerning. Presumably you married her with the intent of staying together forever, so what's the big deal if you spend 50k upgrading the house you live in, assuming you won't get divorced? Now, if you really are worried about something happening in the future, you might want to seek legal advice about the content of the prenup. I am guessing if the 400k were your assets before marriage, you have full claim to that amount in the event of a divorce. If you document the loan, or make some agreement, I would think you would have claim to at least some of the house's appreciation due to the renovations if they were made with your money. *obligatgory IANAL", "title": "" }, { "docid": "da1eab3f51253af88bd0bb0f14b9257c", "text": "There are many other good answers here, but I just wanted to note that it could be dangerous to rely on the changes in alimony and child support that you've mentioned. You have no way of predicting if your ex will lose her job or take the kids back more of the time. If you already have a house and mortgage and all of a sudden alimony and child support go up again, you could be in big trouble. Congrats on everything getting better, it sounds like you're dealing well with a crappy situation. Good luck!", "title": "" }, { "docid": "5a40eee5445e687b0de14606db987a66", "text": "Well, it sounds like you have two options: 1) Continue to jointly own the house. 2) Compensate her for her equity and get the title transferred. I hate to tell you this, but she is entitled to half of the equity regardless of how much she paid into it. That said, she is still on the hook equally for the loan amount, but it won't do you any good if she is not willing to pay. Also, option 2 probably isn't a good deal for your co-signer as she would still be liable for the entire loan loan (just as you are) regardless of the title.", "title": "" }, { "docid": "1e1a0d7d396eb26d24b09d1bad7690a2", "text": "I cannot emphasize enough how important it is, when you buy a house with someone you are not married to, to make a legal agreement on how the money should be divided when you sell. I know it's too late for you, but I write this for anyone else reading this answer. From a legal point of view, if you made no agreement otherwise, you each own 50% of the house. If you want to divide it any other way, you will have to agree what an appropriate division is. Dividing according to the amount each of you paid towards it is a good way. Decide for yourselves if that means just mortgage payments, or also taxes, repairs, utilities etc. You should also be aware that if you have been living together a long time, like more than a year, some jurisdictions will allow one party to sue the other as if they were getting divorced. Then the courts would be involved in the division of property.", "title": "" }, { "docid": "933d4d77ab71aaf0bdb5e1d198ab6f1b", "text": "When I bought my own place, mortgage lenders worked on 3 x salary basis. Admittedly that was joint salary - eg you and spouse could sum your salaries. Relaxing this ratio is one of the reasons we are in the mess we are now. You are shrewd (my view) to realise that buying is better than renting. But you also should consider the short term likely movement in house prices. I think this could be down. If prices continue to fall, buying gets easier the longer you wait. When house prices do hit rock bottom, and you are sure they have, then you can afford to take a gamble. Lets face it, if prices are moving up, even if you lose your job and cannot pay, you can sell and you have potentially gained the increase in the period when it went up. Also remember that getting the mortgage is the easy bit. Paying in the longer term is the really hard part of the deal.", "title": "" }, { "docid": "0bd390b162602650837587935d7d2400", "text": "\"In the short term what does it matter if she has poor credit? Just let it ride and focus on the important things. In the long term the most important part is \"\"completing the divorce\"\". That is separating all parts of her financial life from her ex-husband. This might mean she takes possession of the house and has him off the loan, or she gets off the loan and this may mean forcing a sale. If there are children or alimony involved she needs to build her income to the point that paying child support or alimony does not impact her budget. If she is on the receiving end, then she should budget so those items are bonus money and not counted on. She is flat broke and does not need to worry about borrowing money at this juncture. In this case a low credit score is a blessing.\"", "title": "" }, { "docid": "7cf5c99fe0c5d5951803ae8a0299a763", "text": "The days are long gone when offered mortgages were simply based on salary multiples. These days it's all about affordability, taking into account all incomes and all outgoings. Different lenders will have different rules about what they do and don't accept as incomes; these rules may even vary per-product within the same lender's product list. So for example a mortgage specifically offered as buy-to-let might accept rental income (with a suitable void-period multiplier) into consideration, but an owner-occupier mortgage product might not. Similarly, business rules will vary about acceptance of regular overtime, bonuses, and so on. Guessing at specific answers: #1 maybe, if it's a buy-to-let product, Note that these generally carry a higher interest rate than owner-occupier mortgages; expect about 2% more #2 in my opinion it's extremely unlikely that any lender would consider rental income from your cohabiting spouse #3 probably yes, if it's a buy-to-let product", "title": "" }, { "docid": "666d4e69434731a9ded729f1abad59a5", "text": "\"I encourage you to think of this home purchase decision as a chance to buy into a community that you want your children to grow up in. Try to find a place where you will be happy for the next 20 years, not just the next 2 or 7 years. In your situation, option 1 seems like a bad idea. It will create an obstacle to having children, instead of establishing a place for them to grow up in. Option 2 is close to \"\"buying a house on a layaway plan\"\". It offers the most financial flexibility. It also could result in the best long-term outcome, because you will buy in an established area, and you will know exactly what quality house you will have. But you and your fiancé need to ask yourselves some hard questions: Are you willing to put up with the mess and hassles of remodelling? Are you good at designing such projects? Can you afford to pay for the projects as they occur? Or if you need to finance them, can you get a HELOC to cover them? Especially if you and your fiancé do much of the work yourselves, break down the projects into small enough pieces that you can quickly finish off whatever you are working on at the time, and be happy living in the resulting space. You do not want to be nagging your husband about an unfinished project \"\"forever\"\" -- or silently resenting that a project never got wrapped up. I posted some suggestions for incrementally finishing a basement on the Home Improvement Stack Exchange. If you are up to the job of option 2, it is less risky than option 3. Option 3 has several risks: You don't know what sort of people will live in the neighborhood 5 - 20 years from now. Will the homes be owner-occupied? Or rentals? Will your neighbors care about raising children well? Or will lots of kids grow up in broken homes? Will the schools be good? Disappointing? Or dangerous? Whereas in an established neighborhood, you can see what the neighborhood is currently like, and how it has been changing. Unless you custom-build (or remodel), you don't control the quality of the construction. Some neighborhoods built by Pulte in the last 10 years were riddled with construction defects. You will be paying up-front for features you don't need yet. You might never need some of them. And some of them might interfere with what you realize later on might be better. In stable markets, new homes (especially ones with lots of \"\"upgrades\"\") often decline in value during the first few years. This is because part of the value is in the \"\"newness\"\" and being \"\"up-to-date\"\" with the latest fads. This part of the value wears off over time. Are the homes \"\"at the edge of town\"\" already within reasonable walking distance of parks, schools, church, grocery stores, et cetera? Might the commute from the \"\"edge of town\"\" to work get worse over the next 5 - 20 years?\"", "title": "" }, { "docid": "c7c01e532e699f91dbf3b441b7b6a50c", "text": "It may clarify your thinking if you look at this as two transactions: I am an Australian so I cannot comment on US tax laws but this is how the Australian Tax Office would view the transaction. By thinking this way you can allocate the risks correctly, Partnership Tenancy Two things should be clear - you will need a good accountant and a good lawyer. I do not agree that there is a conflict of interest in the lawyer acting for both parties - his role should only be for advice and to document what the two of you agree to. If you end up in dispute, then you need two lawyers.", "title": "" }, { "docid": "af7968d88cdb674c6d329e2c9e570280", "text": "this seems like a bad idea. Example: You want to sell. He doesn't. But he doesn't have enough money to buy you out. What will you do? You might want to sell because you need money, you have to move, you want to get married, you want to start a new business, etc. You two are not equals (you need a place to live), so this is unlikely to work.", "title": "" }, { "docid": "a4eda79a77fa08f774a90853443ff469", "text": "I'm glad that you feel like being fair and equitable to your party. Other answerers are, of course, correct that being fair and equitable to your girlfriend is not in your best interests but that's not what you're trying to do here and I commend you for it. There is nothing that stops you drawing up a simple legal contract giving your girlfriend a share of the value of your house in return for her payments. Just get it signed and witnessed and checked over by a legal representative. You can include reasonable terms for the money to be paid back if you separate - perhaps when you sell the property or within two years of the breakup - that don't put you in immediate danger of losing the property. Just make clear that this contract is between you and her for a sum of money linked to the value of your house; it does not establish any legal claim on your house itself. A reasonable level for her to claim the property would be one half of the change in equity between when you start joint paying and when you separate - should that happen.", "title": "" }, { "docid": "7da7f4bfd86810b55a4c938eb892ef0a", "text": "As pointed out in a comment, it would be more natural to get a regular mortgage on the second house, which is essentially using the second house as collateral for its own loan. If you are to use the first house, either mortgage it or get a home equity line of credit on it and use that money to buy the second house. The relative merits of the options may depend in part on where you live, whether or not you live in the homes, and the relative cost of the two properties. For example, in the US, first and second homes get preferred tax treatment in addition to rates that are typically better than commercial loans (including mortgages for investment properties). If you're going to get a better rate and pay less taxes on one option and not on the others, that's definitely something to weigh.", "title": "" }, { "docid": "464c9b92963363ecd1df7012855d3cf6", "text": "If the homeowner knows the situation is hopeless, and the end result will be the loss of the home, jumping to the end result can be helpful. It is quicker, they don't spend as much time fighting a losing battle. Deed in Lieu of foreclosure is not so great for the borrower if the bank goes after them for the rest of the money owed. There can also be tax implications if the debt is forgiven. Though these issues also exist when the drawn out foreclosure option is done. For the bank. The longer the process the more the house deteriorates. The borrower may stop maintenance and may even vandalize the house. Getting their lock on the door quickly is important to them. They protect it, clean it, and prep it for sale right away. They also save on lawyer fees. They know that the moment they start the foreclosure process all money from the borrower stops, this can save thousands in carrying costs. One issue will be how the accounting losses will be divided among the servicing company, and the investors. If the servicing company will make more money from the longer process they may not push for the quick settlement. If the opposite is true, they will be quickly on board. For the new buyer, the issue with either foreclosure is that the longer process can result in greater hidden and visible damage. The heat pump may work, but the disgruntled homeowner stopped changing the filters the last six months. They may have also removed and damaged things on the way out. Other than that I don't see a big difference. Because the bank had lower costs involved in the foreclosure they might settle for a lower purchase price, but that might be hard to know.", "title": "" }, { "docid": "c79f69255b4e48d9fb7c0bd8fbbedcbe", "text": "\"I'm going to assume that by \"\"register the house in my name\"\" you mean that the house is legally yours. In that case there are a number of implications, tax and otherwise. You should also be very clear with your father about what happens when the house is sold. Do you give him back what he paid for it? Does he get all the value? What happens if the value has gone down? Some of this is down to Indian law, which I know nothing about. However all of these are red flags which you should consider before doing this. This is not legal advice in any jurisdiction.\"", "title": "" } ]	fiqa
acc18c2b6750d5b2b36e3c1b1715fd3e	Calculating the value of an investors inventory	[ { "docid": "1cc4b08bb104d39397a5e68f8d951d9f", "text": "Is it just -344.58= -$155.72 for CCC and -110.41= -$4.51 for DDD? Yes it needs to be recorded as negative because at some point in time, the investor will have to spend money to buy these shares [cover the short sell and return the borrowed shares]. Whether the investor made profit or loss will not be reflected as you are only reflecting the current share inventory.", "title": "" } ]	[ { "docid": "6102ca35a6adf578632c2b0f37dadc2f", "text": "\"Below I will try to explain two most common Binomial Option Pricing Models (BOPM) used. First of all, BOPM splits time to expiry into N equal sub-periods and assumes that in each period the underlying security price may rise or fall by a known proportion, so the value of an option in any sub-period is a function of its possible values in the following sub period. Therefore the current value of an option is found by working backwards from expiry date through sub-periods to current time. There is not enough information in the question from your textbook so we may assume that what you are asked to do is to find a value of a call option using just a Single Period BOPM. Here are two ways of doing this: First of all let's summarize your information: Current Share Price (Vs) = $70 Strike or exercise price (X) = $60 Risk-free rate (r) = 5.5% or 0.055 Time to maturity (t) = 12 months Downward movement in share price for the period (d) = $65 / $70 = 0.928571429 Upward movement in share price for the period (u) = 1/d = 1/0.928571429 = 1.076923077 \"\"u\"\" can be translated to $ multiplying by Vs => 1.076923077 * $70 = $75.38 which is the maximum probable share price in 12 months time. If you need more clarification here - the minimum and maximum future share prices are calculated from stocks past volatility which is a measure of risk. But because your textbook question does not seem to be asking this - you probably don't have to bother too much about it yet. Intrinsic Value: Just in case someone reading this is unclear - the Value of an option on maturity is the difference between the exercise (strike) price and the value of a share at the time of the option maturity. This is also called an intrinsic value. Note that American Option can be exercised prior to it's maturity in this case the intrinsic value it simply the diference between strike price and the underlying share price at the time of an exercise. But the Value of an option at period 0 (also called option price) is a price you would normally pay in order to buy it. So, say, with a strike of $60 and Share Price of $70 the intrinsic value is $10, whereas if Share Price was $50 the intrinsic value would be $0. The option price or the value of a call option in both cases would be fixed. So we also need to find intrinsic option values when price falls to the lowest probable and rises to the maximum probable (Vcd and Vcu respectively) (Vcd) = $65-$60 = $5 (remember if Strike was $70 then Vcd would be $0 because nobody would exercise an option that is out of the money) (Vcu) = $75.38-$60 = $15.38 1. Setting up a hedge ratio: h = Vs(u-d)/(Vcu-Vcd) h = 70(1.076923077-0.928571429)/(15.38-5) = 1 That means we have to write (sell) 1 option for each share purchased in order to hedge the risks. You can make a simple calculation to check this, but I'm not going to go into too much detail here as the equestion is not about hedging. Because this position is risk-free in equilibrium it should pay a risk-free rate (5.5%). Then, the formula to price an option (Vc) using the hedging approach is: (Vs-hVc)(e^(rt))=(Vsu-hVcu) Where (Vc) is the value of the call option, (h) is the hedge ratio, (Vs) - Current Share Price, (Vsu) - highest probable share price, (r) - risk-free rate, (t) - time in years, (Vcu) - value of a call option on maturity at the highest probable share price. Therefore solving for (Vc): (70-1Vc)(e^(0.055(12/12))) = (75.38-115.38) => (70-Vc)1.056540615 = 60 => 70-Vc = 60/1.056540615 => Vc = 70 - (60/1.056540615) Which is similar to the formula given in your textbook, so I must assume that using 1+r would be simply a very close approximation of the formula above. Then it is easy to find that Vc = 13.2108911402 ~ $13.21 2. Risk-neutral valuation: Another way to calculate (Vc) is using a risk-neutral approach. We first introduce a variable (p) which is a risk-neutral probability of an increase in share price. p = (e^(rt)-d)/(u-d) so in your case: p = (1.056540615-0.928571429)/(1.076923077-0.928571429) = 0.862607107 Therefore using (p) the (Vc) would be equal: Vc = [pVcu+(1-p)Vcd]/(e^(rt)) => Vc = [(0.86260710715.38)+(0.1373928935)]/1.056540615 => Vc = 13.2071229185 ~ $13.21 As you can see it is very close to the hedging approach. I hope this answers your questions. Also bear in mind that there is much more to the option pricing than this. The most important topics to cover are: Multi-period BOPM Accounting for Dividends Black-Scholes-Merton Option Pricing Model\"", "title": "" }, { "docid": "ef9d348bbe5f1714fae78ad0a3deefa4", "text": "Given that a mutual fund manager knows, at the end of the day, precisely how many shares/units/whatever of each investment (stock, equity, etc.) they own, plus their bank balance, It is calculating this given. There are multiple orders that a fund manager requests for execution, some get settled [i.e. get converted into trade], the shares itself don't get into account immediately, but next day or 2 days later depending on the exchange. Similarly he would have sold quite a few shares and that would still show shares in his account. The bank balance itself will not show the funds to pay as the fund manager has purchased something ... or the funds received as the fund manager has sold something. So in general they roughly know the value ... but they don't exactly know the value and would have to factor the above variables. That's not a simple task when you are talking about multiple trades across multiple shares.", "title": "" }, { "docid": "2062d8a92e3151241257c925fd0c2a15", "text": "One way that is common is to show the value over time of an initial investment, say $10,000. The advantage of this is that it doesn't show stock price at all, so handles splits well. It can also take into account dividend reinvestment. Fidelity uses this for their mutual funds, as can be seen here. Another option would be to compute the stock price as if the split didn't happen. So if a stock does a 2:1 split, you show double the actual price starting at that point.", "title": "" }, { "docid": "e8050a204949864b98ceb2a99091d727", "text": "Hey Sheehan, I believe Schwab provides this info. None of the online free portfolio managers I know of gives you this info. The now defunct MS Money used to have this. The best thing to do is to use a spreadsheet. Or you could use the one I use. http://www.moneycone.com/did-you-beat-the-market-mr-investor/ . (disclaimer: that's my blog)", "title": "" }, { "docid": "8a6e87ece5bda5dbb3720b8f90837b88", "text": "\"Here is how I would approach that problem: 1) Find the average ratios of the competitors: 2) Find the earnings and book value per share of Hawaiian 3) Multiply the EPB and BVPS by the average ratios. Note that you get two very different numbers. This illustrates why pricing from ratios is inexact. How you use those answers to estimate a \"\"price\"\" is up to you. You can take the higher of the two, the average, the P/E result since you have more data points, or whatever other method you feel you can justify. There is no \"\"right\"\" answer since no one can accurately predict the future price of any stock.\"", "title": "" }, { "docid": "cf8488ef41130233fcc63a7b933a6fdf", "text": "So, the price-earnings ratio is price over earnings, easy enough. But obviously earnings are not static. In the case of a growing company, the earnings will be higher in the future. There will be extra earnings, above and beyond what the stock has right now. You should consider the future earnings in your estimate of what the company is worth now. One snag: Those extra earnings are future money. Future-money is an interesting thing, it's actually worth less than present-money- because of things like inflation, but also opportunity cost. So if you bought $100 in money that you'll have 20 years from now, you'd expect to pay less than $100. (The US government can sell you that money. It's called a Series EE Savings Bond and it would cost you $50. I think. Don't quote me on that, though, ask the Treasury.) So you can't compare future money with present-money directly, and you can't just add those dollars to the earnings . You need to compute a discount. That's what discounted cash-flow analysis is about: figuring out the future cash flow, and then discounting the future figuring out what it's worth now. The actual way you use the discount rate in your formula is a little scarier than simple division, though, because it involves discounting each year's earnings (in this case, someone has asserted a discount of 11% a year, and five years of earnings growth of 10%). Wikipedia gives us the formula for the value of the future cash flow: essentially adding all the future cash flows together, and then discounting them by a (compounded) rate. Please forgive me for not filling this formula out; I'm here for theory, not math. :)", "title": "" }, { "docid": "4e30ca5efd5d21101a2e6d781d8bcf48", "text": "Some personal finance packages can track basis cost of individual purchase lots or fractions thereof. I believe Quicken does, for example. And the mutual funds I'm invested in tell me this when I redeem shares. I can't vouch for who/what would make this visible at times other than sale; I've never had that need. For that matter I'm not sure what value the info would have unless you're going to try to explicitly sell specific lots rather than doing FIFO or Average accounting.", "title": "" }, { "docid": "35a4bbdf656a4b0e349eb5bf63dd1e6d", "text": "\"Treat each position or partial position as a separate LOT. Each time you open a position, a new lot of shares is created. If you sell the whole position, then the lot is closed. Done. But if you sell a partial quantity, you need to create a new lot. Split the original lot into two. The quantities in each are the amount sold, and the amount remaining. If you were to then buy a few more shares, create a third lot. If you then sell the entire position, you'll be closing out all the remaining lots. This allows you to track each buy/sell pairing. For each lot, simply calculate return based on cost and proceeds. You can't derive an annualized number for ALL the lots as a group, because there's no common timeframe that they share. If you wish to calculate your return over time on the whole series of trades, consider using TWIRR. It treats these positions, plus the cash they represent, as a whole portfolio. See my post in this thread: How can I calculate a \"\"running\"\" return using XIRR in a spreadsheet?\"", "title": "" }, { "docid": "237d225e0da24ae0ac9d26ba666568d8", "text": "i will not calculate it for you but just calculate the discounted cash flow (by dividing with 1.1 / 1.1^2 / 1.1^3 ...)of each single exercise as stated and deduct the 12.000 of the above sum. in the end compare which has the highest npv", "title": "" }, { "docid": "a1f8e1e935ad365e016e2e6468cf4797", "text": "Adding assets (equity) and liabilities (debt) never gives you anything useful. The value of a company is its assets (including equity) minus its liabilities (including debt). However this is a purely theoretical calculation. In the real world things are much more complicated, and this isn't going to give you a good idea of much a company's shares are worth in the real world", "title": "" }, { "docid": "983e84eb31d74702554938415b8ccc43", "text": "One approach would be to create Journal Entries that debit asset accounts that are associated with these items and credit an Open Balance Equity account. The value of these contributions would have to be worked out with an accountant, as it depends on the lesser of the adjusted basis vs. the fair market value, as you then depreciate the amounts over time to take the depreciation as a business expense, and it adjusts your basis in the company (to calculate capital gains/losses when you sell). If there were multiple partners, or your accountant wants it this way, you could then debit open balance equity and credit the owner's contribution to a capital account in your name that represents your basis when you sell. From a pure accounting perspective, if the Open Balance Equity account would zero out, you could just skip it and directly credit the capital accounts, but I prefer the Open Balance Equity as it helps know the percentages of initial equity which may influence partner ownership percentages and identify anyone who needs to contribute more to the partnership.", "title": "" }, { "docid": "7ca594024cad43676e532bdd3be3a86d", "text": "No, it's not all long-term capital gain. Depending on the facts of your situation, it will be either ordinary income or partially short-term capital gain. You should consider consulting a tax lawyer if you have this issue. This is sort of a weird little corner of the tax law. IRC §§1221-1223 don't go into it, nor do the attendant Regs. It also somewhat stumped the people on TaxAlmanac years ago (they mostly punted and just declared it self-employment income, avoiding the holding period issue). But I did manage to find it in BNA Portfolio 562, buried in there. That cited to a court case Comm'r v. Williams, 256 F.2d 152 (5th Cir. 1958) and to Revenue Ruling 75-524 (and to another Rev. Rul.). Rev Rul 75-524 cites Fred Draper, 32 T.C. 545 (1959) for the proposition that assets are acquired progressively as they are built. Note also that land and improvements on it are treated as separate assets for purposes of depreciation (Pub 946). So between Williams (which says something similar but about the shipbuilding industry) and 75-524, as well as some related rulings and cases, you may be looking at an analysis of how long your property has been built and how built it was. You may be able to apportion some of the building as long-term and some as short-term. Whether the apportionment should be as to cost expended before 1 year or value created before 1 year is explicitly left open in Williams. It may be simpler to account for costs, since you'll have expenditure records with dates. However, if this is properly ordinary income because this is really business inventory and not merely investment property, then you have fully ordinary income and holding period is irrelevant. Your quick turnaround sale tends to suggest this may have been done as a business, not as an investment. A proper advisor with access to these materials could help you formulate a tax strategy and return position. This may be complex and law-driven enough that you'd need a tax lawyer rather than a CPA or preparer. They can sort through the precedent and if you have the money may even provide a formal tax opinion. Experienced real estate lawyers may be able to help, if you screen them appropriately (i.e. those who help prepare real estate tax returns or otherwise have strong tax crossover knowledge).", "title": "" }, { "docid": "3a43fd02236810d0cff0fa9231398b1d", "text": "Let's suppose your friend gave your $100 and you invested all of it (plus your own money, $500) into one stock. Therefore, the total investment becomes $100 + $500 = $600. After few months, when you want to sell the stock or give back the money to your friend, check the percentage of profit/loss. So, let's assume you get 10% return on total investment of $600. Now, you have two choices. Either you exit the stock entirely, OR you just sell his portion. If you want to exit, sell everything and go home with $600 + 10% of 600 = $660. Out of $660, give you friend his initial capital + 10% of initial capital. Therefore, your friend will get $100 + 10% of $100 = $110. If you choose the later, to sell his portion, then you'll need to work everything opposite. Take his initial capital and add 10% of initial capital to it; which is $100 + 10% of $100 = $110. Sell the stocks that would be worth equivalent to that money and that's it. Similarly, you can apply the same logic if you broke his $100 into parts. Do the maths.", "title": "" }, { "docid": "bf0540111a2051185227f72005547c32", "text": "\"Generally if you are using FIFO (first in, first out) accounting, you will need to match the transactions based on the number of shares. In your example, at the beginning of day 6, you had two lots of shares, 100 @ 50 and 10 @ 52. On that day you sold 50 shares, and using FIFO, you sold 50 shares of the first lot. This leaves you with 50 @ 50 and 10 @ 52, and a taxable capital gain on the 50 shares you sold. Note that commissions incurred buying the shares increase your basis, and commissions incurred selling the shares decrease your proceeds. So if you spent $10 per trade, your basis on the 100 @ 50 lot was $5010, and the proceeds on your 50 @ 60 sale were $2990. In this example you sold half of the lot, so your basis for the sale was half of $5010 or $2505, so your capital gain is $2990 - 2505 = $485. The sales you describe are also \"\"wash sales\"\", in that you sold stock and bought back an equivalent stock within 30 days. Generally this is only relevant if one of the sales was at a loss but you will need to account for this in your code. You can look up the definition of wash sale, it starts to get complex. If you are writing code to handle this in any generic situation you will also have to handle stock splits, spin-offs, mergers, etc. which change the number of shares you own and their cost basis. I have implemented this myself and I have written about 25-30 custom routines, one for each kind of transaction that I've encountered. The structure of these deals is limited only by the imagination of investment bankers so I think it is impossible to write a single generic algorithm that handles them all, instead I have a framework that I update each quarter as new transactions occur.\"", "title": "" }, { "docid": "22dcd0ba9de89e97f557a7a9a927f198", "text": "Thanks for this, great in depth answer. I had previously calculated a WACC and have used it for my discount rate. As part of your last point on revenue vs. cash, I've set a accounts receivable period of 30 days, and then applied a factor of 30/365 revenue to understand what portion of my revenue is not cash in hand. Does that make sense?", "title": "" } ]	fiqa
6d945bce4ca357b30177d8b4b2bb5ed5	What is a straddle?	[ { "docid": "408604a92de5c1ef2ea8333597a02c7b", "text": "\"A straddle is an options strategy in which one \"\"buys\"\" or \"\"sells\"\" options of the same maturity (expiry date) that allow the \"\"buyer\"\" or \"\"seller\"\" to profit based on how much the price of the underlying security moves, regardless of the direction of price movement. IE: A long straddle would be: You buy a call and a put at the same strike price and the same expiration date. Your profit would be if the underlying asset(the stock) moves far enough down or up(higher then the premiums you paid for the put + call options) (In case, one waits till expiry) Profit = Expiry Level - Strike Price - (Premium Paid for Bought Options) Straddle\"", "title": "" }, { "docid": "e4a0495fedb4a5edad9a887d78543dc5", "text": "\"Came across this very nice video which explains the \"\"Long Straddle\"\". Thought will share the link here: http://www.khanacademy.org/finance-economics/core-finance/v/long-straddle\"", "title": "" } ]	[ { "docid": "5255d150c1443af666c5c63f8400a873", "text": "Long Straddle: \\\\/ Assuming you're trying to straddle the spot price, it will be more expensive to set up than a strangle as options strikes near the spot are more costly. Any price movement will regain against what was spent to acquire the options. Long Strangle: \\\\_/ Assuming you're trying to strangle the spot price, it will be less expensive to set up than a straddle as the options strikes are away from the spot. It will require a larger price movement than the straddle to begin to regain value against what you spent, as there is a dead zone between the strikes where both expire worthless. The / is the gain from a price movement up from the increase in value of calls; the \\\\ is the gain from a price movement down from the increase in value of puts.", "title": "" }, { "docid": "5f4196bb7ccd99befb88c4860b637223", "text": "The Thule Outride 561 is a aluminium frame, super light weight roof-top option to carry your bike or two. This lovely bike carrier is especially designed for sports bikes with carbon frames. The Thule Outride 561 sports quick release wheel straps for near instant loading and unloading of your bikes.Bikes can be locked to the carrier making them difficult to steal.", "title": "" }, { "docid": "99e624fff0e94350a2a86d1a88cc5782", "text": "\"Support and resistance points indicate price levels where there have been a large amount of trading activity, usually from institutions, that tend to stabilize the price of a stock. Support is a temporary FLOOR, where people have been buying in large quantities. That means there's a good chance that the stock won't go below this level in the near term. (But if it does, watch out.) Resistance is a temporary CEILING where people have been selling. When the stock price hits this level, people tend to sell, and push it back down. Until there are \"\"no more\"\" sellers at this level. Then the price could skyrocket if there is enough buying.\"", "title": "" }, { "docid": "9f9560e91a513fd2d65cc22ffd0ef481", "text": "G spread - you have a 5.5 year bond, you take your yield minus the yield on the 5.5y point (interpolated) of the benchmark sovereign curve. Think of G = Government. I Spread - same as G Spread but you use the relevant Swap Curve. E.g. USD bond, compare against the USD Swaps curve. I = interpolated. Z Spread - stands for zero volatility curve spread. You strip the swaps curve to get zero rates (i.e. Zero coupon rates for each tenor), then find the constant spread on top of each part of the curve's zero rates to arrive at your bond's yield. In G and I Spread, you're basically discounting the bond's cash flows using one rate (i.e. The interpolated yield on the curve). With Z Spread, you're discounting using the entire portion of the curve that's relevant to your bond's maturity.", "title": "" }, { "docid": "d16d0bf2b9e90273c4687c5fd11f194c", "text": "The mechanism is allowing insertion of 3 butyl rubber seals in the window between the frame and the opening sash. It has an external seal, mid window, and inner seal. Due to its constructional make-up many non-tilt turn manufacturers are limited to one or two seals.", "title": "" }, { "docid": "9443fc7e998ed1319ccfc06ef4babaf3", "text": "\"The question mentions a trailing stop. A trailing stop is a type of stop loss order. It allows you to protect your profit on the stock, while \"\"keeping you in the stock\"\". A trailing stop is specified as a percentage of market price e.g. you might want to set a trailing stop at 5%, or 10% below the market price. A trailing stop goes up along with the market price, but if the market price drops it doesn't move down too. The idea is that it is there to \"\"catch\"\" your profit, if the market suddenly moves quickly against you. There is a nice explanation of how that works in the section titled Trailing Stops here. (The URL for the page, \"\"Tailing Stops\"\" is misleading, and a typo, I suspect.)\"", "title": "" }, { "docid": "9f7480c531b54617d48b4209eb223fc5", "text": "Depending on the structure of you're portfolio, it could be that your portfolio is delta neutral to take advantage of diminishing time value on options, short straddles/strangles would be an example.", "title": "" }, { "docid": "c11fd96f7cb96361369a66de5e534f63", "text": "The main reason is that you move from the linear payoff structure to a non-linear one. This is called convexity in finance. With options you can design a payoff structure in almost any way to want it to be. For example you can say that you only want the upside but not the downside, so you buy a call option. It is obvious that this comes at a price, the option premium. Or equivalently you buy the underlying and for risk management reasons buy a put option on top of it as an insurance. The price of the put could be seen as the insurance premium. You can of course combine options in more complicated ways so that you e.g. profit as long as the underlying moves strongly enough in either direction. This is called a straddle.", "title": "" }, { "docid": "02fa66cfa69d5558e602110f32d2b89a", "text": "Activist Investor is the entrenched capitalists fake news meme. Trump wants to pass a law that says shareholders don't even get a vote until they pass a certain threshold on ownership % of a company so they can keep all the little people from having any say. Ownership isn't really ownership unless you're rich I guess. Democracy bad! Freedom! America!", "title": "" }, { "docid": "cfd59d5453f7bac8980471a1619cf26d", "text": "Basic arbitrage is the (near-)simultaneous purchasing and selling of things that are convertible. The classic example is the international trading of equities. If someone in London wants to purchase a hundred shares of Shell for 40 GBP ea. and someone in New York wants to sell you a hundred shares of Shell for 61 USD ea., you can buy the shares from the guy in New York, sell them to the guy in London and convert your GBP back in to USD for a profit of $41.60 minus fees. Now, if after you buy the shares in New York, the price in London goes down, you'll be left holding 100 shares of Shell that you don't want. So instead you should borrow 100 shares in London and sell them at the exact same time that you buy the shares in New York, thus keeping your net position at 0. In fact, you should also borrow 4000GBP and convert them to USD at the same time, so that exchange rate changes don't get you.", "title": "" }, { "docid": "1f7978f03b234315a7862f5a9805f687", "text": "Honestly this sounds like a bug. In the early days of HFT, quote stuffing looked like this, but everyone created anti manipulation algos that do Fourier transforms to catch that kind of behavior. Modern manipulation is much cleverer than this. Source: I have designed anti manipulation algos for a HFT firm.", "title": "" }, { "docid": "f20d92bc6a775adc0c14cd28383bc89d", "text": "Bootstrap has been a verb for a very long time, and you've used it as such all your life, or at the very least it's short form: booting. It means, as you well know, to lift yourself up using your own resources.", "title": "" }, { "docid": "9cedcae6dfdecb867a27c9c8ef85f01c", "text": "We specialize in pedestrian traffic and crowd control stanchions and systems. We sell the best Stanchions (Stantions), Barriers, ADA Compliant Posts, Display Posts, Heavy Duty Utility Posts, Single and Dual Line Posts, Belts, Ropes, and other crowd control equipment. We strive to take online business to new levels of customer satisfaction, convenience and value for both the consumer and business.", "title": "" }, { "docid": "b6a62a2fce4ea7b69f9998722e5496b0", "text": "\"I think for this a picture is worth a thousand words. This is a \"\"depth chart\"\" that I pulled from google images, specifically because it doesn't name any security. On the left you have all of the \"\"bids\"\" to buy this security, on the right you have the \"\"asks\"\" to sell the security. In the middle you have the bid/ask spread, this is the space between the highest bid and the lowest ask. As you can see you are free to place you order to the market to buy for 232, and someone else is free to place their order to the market to sell for 234. When the bid and the ask match there's a transaction for the maximum number of available shares. Alternatively, someone can place a market order to buy or sell and they'll just take the current market price. Retail investors don't really get access to this kind of chart from their brokers because for the most part the information isn't terribly relevant at the retail level.\"", "title": "" }, { "docid": "2a860f472019b789c01be01acfce6145", "text": "If it wasn't true before I learned it than how was I taught it in the first place e where I would believe it? Do you know what gish galloping is? I'm perfectly open to other viewpoints but I'm not going to watch two long videos. Can you just make the points in these vids?", "title": "" } ]	fiqa
b25b2baeba102a5134a99ea903f54e61	What is Systematic about Systematic Investment Plan (SIP) and who invented it?	[ { "docid": "9bb7b8aede695604b77c31265ad39ced", "text": "According to https://en.wikipedia.org/wiki/Systematic_Investment_Plan it's nothing but a fancy term for plain old dollar cost averaging.", "title": "" }, { "docid": "ce6d317e89ec1170e735acd3e5886923", "text": "\"Personally, I think you are approaching this from the wrong angle. You're somewhat correct in assuming that what you're reading is usually some kind of marketing material. Systematic Investment Plan (SIP) is not a universal piece of jargon in the financial world. Dollar cost averaging is a pretty universal piece of jargon in the financial world and is a common topic taught in finance classes in the US. On average, verified by many studies, individuals will generate better investment returns when they proactively avoid timing the market or attempting to pick specific winners. Say you decide to invest in a mutual fund, dollar cost averaging means you invest the same dollar amount in consistent intervals rather than buying a number of shares or buying sporadically when you feel the market is low. As an example I'll compare investing $50 per week on Wednesdays, versus 1 share per week on Wednesdays, or the full $850 on the first Wednesday. I'll use the Vanguard Large cap fund as an example (VLCAX). I realize this is not really an apples to apples comparison as the invested amounts are different, I just wanted to show how your rate of return can change depending on how your money goes in to the market even if the difference is subtle. By investing a common dollar amount rather than a common share amount you ultimately maintain a lower average share price while the share price climbs. It also keeps your investment easy to budget. Vanguard published an excellent paper discussing dollar cost averaging versus lump sum investing which concluded that you should invest as soon as you have funds, rather than parsing out a lump sum in to smaller periodic investments, which is illustrated in the third column above; and obviously worked out well as the market has been increasing. Ultimately, all of these companies are vying to customers so they all have marketing teams trying to figure out how to make their services sound interesting and unique. If they all called dollar cost averaging, \"\"dollar cost averaging\"\" none of them would appear to be unique. So they devise neat acronyms but it's all pretty much the same idea. Trickle your money in to your investments as the money becomes available to you.\"", "title": "" } ]	[ { "docid": "cc7c2a1a259107b06e67961ef331cb51", "text": "\"I don't agree that the market as a whole is a ponzi scheme, but there are some ponzi-like aspects to it. If you buy high quality stocks like Coca Cola, Johnson and Johnson, AT&T, Verizon, Kraft, Wells Fargo (the vanilla bank, not one of the crazy ones), IBM, Berkshire Hathaway etc and simply hold onto them for the next 10-20 years, you will make money. Even over the last decade, when stocks \"\"went nowhere\"\", you still came out ahead through the dividend payments. It was just at an unsatisfactory rate of return. Also \"\"the market\"\" consists of a lot more than just stocks. Corporate bonds are a big market and I always recommend people to look at bonds. If you cannot judge whether a company is credit worthy, how can you invest in the common stock? I've made a lot more money myself in the bond market than in the stock market. However, for many stocks, they do look a lot like ponzi schemes. This is true, in particular, with many of the tech stocks (Cuban was a tech investor, so that is probably where his sentiment is coming from). You have many of these companies that create great products. However, they never have positive cash flow because all the money is spent to develop new products. As the share price goes up, the company issues new shares to fund research, stock options to employees to enrich them, etc. However, eventually, they run into a string of bad research that do not yield a new product and the share price plunges. Perhaps the company goes bankrupt. So you have a company that developed great products, but the shareholders never got a penny in dividends and the final shareholders have paper worth zero. Take a look at Research in Motion for example. Creating the Blackberry has to be one of the biggest successes in tech over the last decade. However, has the shareholders gotten any richer? Only if they traded amongst themselves, nobody got a dividend. What happened to the many billions of dollars they made during the peak popularity years of Blackberry? It went to executives, employees, and was squandered on development that did not effectively defend the phone's dominant market position. Now the stock price is back down to the pre-prime years, and if a shareholder held onto it throughout the entire period, he would not have received a single penny. And this is a profitable enterprise, things look even more bizarre when you start looking at the tech companies that have NEVER had a positive earnings quarter and no plans to ever have positive earnings (something like Pandora comes to mind). Often, management at these more bizarre companies run the company as a toy - to play with their own ideas and to issue themselves stock as compensation. And of course, they sell a lot of the stock to cash in before they delve into the next risky venture. They have no intention of ever enriching anybody who holds into the stock in the long run. If for some reason they make money, they will put it all into their next toy project until one of them fails and wipes everything out. If you invest in a profitable business with reasonable management, you will generally come out ahead. Some businesses get displaced by unpredictable circumstances and they go bankrupt. But on average, if a company is good at doing something and they pay out the earnings, you come out ahead. You get in trouble when businesses are good at something, and they take all the money they make and put it into doing something they are not good at. A business might only provide good cashflow for 10-20 years when the product is popular and before competitors cut into margins. If that money is squandered, the long term shareholder may ultimately have very terrible results. The long term shareholder ends up being the guy who keeps going all-in on a 80%-chance-to-win bet (that is what management is doing when they bet the company on the next unproven product), but eventually he gets zeroed out on one loss. This is why if you look at Buffett's investments, they are all in simple businesses that spits off cash to the owner/shareholder. Businesses like soft drinks, snacks, rail roads, vanilla banking, utility-like energy companies, insurance, etc. You might be good at judging the odds of whether a business will succeed or not (aka make more money than your original investment or not). But you don't want management of that company to make a wildly different bet for you. Just because they are great at operating a company doesn't mean they are good enough at judging odds or disciplined enough to make those bets for you. I may have predicted accurately that Business X will be a great success, but if manage takes those profits and goes all in on Business Y, without giving me a chance to cash out, that may have disasterous results.\"", "title": "" }, { "docid": "ada2e018d9ad8e121436af88638a8910", "text": "\"Yes, the \"\"speed bump\"\" explicitly can not impact the reports to the SIP. Two years ago this would not be a big deal, because the SIP was stupidly slow, especially under load. So, you send your report to the SIP faster than you publish your own market data feed, and the SIP just takes forever to publish, meaning your own market data feed still gets to the clients first. Now that the SIP is blazingly fast this is no longer the case. You still, as an exchange, have to publish to the SIP first (or, within microseconds of jitter, at the same time) but if you have some sort of artificial delay on your market data that is longer than the SIP processing time the SIP updates will arrive first. Doubly so if the consumers are colocated with one of the SIPs. Edit: For what it's worth, [Matt Hurd has a pretty solid write up covering NYSE American, but it pertains to IEX as well](https://meanderful.blogspot.com/2017/05/nyse-american-attack-of-clones.html) [BATS also comments on this phenomenon in their SEC comment letter on NYSE American; see footnote 1 on the first page](https://www.sec.gov/comments/sr-nysemkt-2017-05/nysemkt201705-1718167-150440.pdf) (pdf). The link is somewhat recursive, since it points back to another of Hurd's posts, but still just as accurate an assessment.\"", "title": "" }, { "docid": "f8c0df79874e1a7f888fd3b4029697e3", "text": "As a thought experiment I suppose we can ask where dividends came from and what would be different if they never existed. The VOC or Dutch East India Companywas the first to IPO, sell shares and also have a dividend. There had been trade entrepot before the VOC, the bulk cog (type of sea-going ship) trade in the Hanseatic League, but the VOC innovation was to pool capital to build giant spice freighters - more expensive than a merchant partnership could likely finance (and stand to lose at sea) on their own but more efficient than the cogs and focused on a trade good with more value. The Dutch Republic became rich by this capital formed to pursue high value trade. Without dividends this wouldn't have been an innovation in seventeenth century Europe and enterprises would be only as large as say the contemporary merchant family networks of Venice could finance. So there could be large partnerships, family businesses and debt financed ventures but no corporations as such.", "title": "" }, { "docid": "dd0cdb33bb16c2cd9885660a2f39574d", "text": "The article links to William Bernstein’s plan that he outlined for Business Insider, which says: Modelling this investment strategy Picking three funds from Google and running some numbers. The international stock index only goes back to April 29th 1996, so a run of 21 years was modelled. Based on 15% of a salary of $550 per month with various annual raises: Broadly speaking, this investment doubles the value of the contributions over two decades. Note: Rebalancing fees are not included in the simulation. Below is the code used to run the simulation. If you have Mathematica you can try with different funds. Notice above how the bond index (VBMFX) preserves value during the 2008 crash. This illustrates the rationale for diversifying across different fund types.", "title": "" }, { "docid": "ee77ed54bd1eff8264dd44dd0dfa186a", "text": "Perhaps someone has an investment objective different than following the market. If one is investing in stocks with an intent on getting dividend income then there may be other options that make more sense than owning the whole market. Secondly, there is Slice and Dice where one may try to find a more optimal investment idea by using a combination of indices and so one may choose to invest 25% into each of large-cap value, large-cap growth, small-cap value and small-cap growth with an intent to pick up benefits that have been seen since 1927 looking at Fama and French's work.", "title": "" }, { "docid": "4e35c62837d601cc2ddb9af278e6287e", "text": "Cornerstone Strategic Value Fund, Inc. is a diversified, closed-end management investment company. It was incorporated in Maryland on May 1, 1987 and commenced investment operations on June 30, 1987. The Fund’s shares of Common Stock are traded on the NYSE MKT under the ticker symbol “CLM.”[1] That essentially means that CLM is a company all of whose assets are held as tradable financial instruments OR EQUIVALENTLY CLM is an ETF that was created as a company in its own right. That it was founded in the 80s, before the modern definition of ETFs really existed, it is probably more helpful to think of it by the first definition as the website mentions that it is traded as common stock so its stock holds more in common with stock than ETFs. [1] http://www.cornerstonestrategicvaluefund.com/", "title": "" }, { "docid": "7ede31fcc47e5b8ff627c7d2387e5796", "text": "Why is that? With all the successful investors (including myself on a not-infrequent basis) going for individual companies directly, wouldn't it make more sense to suggest that new investors learn how to analyse companies and then make their best guess after taking into account those factors? I have a different perspective here than the other answers. I recently started investing in a Roth IRA for retirement. I do not have interest in micromanaging individual company research (I don't find this enjoyable at all) but I know I want to save for retirement. Could I learn all the details? Probably, as an engineer/software person I suspect I could. But I really don't want to. But here's the thing: For anyone else in a similar situation to me, the net return on investing into a mutual fund type arrangement (even if it returns only 4%) is still likely considerably higher than the return on trying to invest in stocks (which likely results in $0 invested, and a return of 0%). I suspect the overwhelming majority of people in the world are more similar to me than you - in that they have minimal interest in spending hours managing their money. For us, mutual funds or ETFs are perfect for this.", "title": "" }, { "docid": "6bfdc5b647b5f94ef5ffe18b4b174c9a", "text": "\"Despite Buffett's nearly perfect consistent advice over the past few decades, they don't reflect his earliest days. His modern philosophy seemed to solidify in the 1970s. You can see that Buffett's earliest days grew faster, at 29.5 % for those partners willing to take on leverage with Buffett, than the last half century, at 19.7%. Not only is Buffett limited by size, as its quite difficult to squeeze one half trillion USD into sub-billion USD investments, but the economy thus market is far different than it was before the 1980s. He would have to acquire at least 500 billion USD companies outright, and there simply aren't that many available that satisfy all of his modern conditions. The market is much different now than it was when he first started at Graham-Newman because before the 1960s, the economy thus market would collapse and rebound about every few years. This sort of variance can actually help a value investor because a true value investor will abandon investments when valuations are high and go all in when valuations are low. The most extreme example was when he tried to as quietly as possible buy up an insurance company selling for something like a P/E of 1 during one of the collapses. These kinds of opportunities are seldom available anymore, not even during the 2009 collapse. As he became larger, those investments became off limits because it simply wasn't worth his time to find such a high returner if it's only a bare fraction of his wealth. Also, he started to deviate from Benjamin Graham's methods and started to incorporate Philip Fisher's. By the 1970s, his investment philosophy was more or less cemented. He tried to balance Graham's avarice for price with Fisher's for value. All of the commentary that special tax dodges or cheap financing are central to his returns are false. They contributed, but they are ancillary. As one can see by comparing the limited vs general partners, leverage helps enormously, but this is still a tangent. Buffett has undoubtedly built his wealth from the nature of his investments. The exact blueprint can be constructed by reading every word he has published and any quotes he has not disavowed. Simply, he buys the highest quality companies in terms of risk-adjusted growth at the best available prices. Quantitatively, it is a simple strategy to replicate. NFLX was selling very cheaply during the mid-2000s, WDC sells frequently at low valuations, up and coming retailers frequently sell at low valuations, etc. The key to Buffett's method is emotional control and removing the mental block that price equals value; price is cost, value is revenue, and that concept is the hardest for most to imbibe. Quoting from the first link: One sidelight here: it is extraordinary to me that the idea of buying dollar bills for 40 cents takes immediately to people or it doesn't take at all. It's like an inoculation. If it doesn't grab a person right away, I find that you can talk to him for years and show him records, and it doesn't make any difference. They just don't seem able to grasp the concept, simple as it is. A fellow like Rick Guerin, who had no formal education in business, understands immediately the value approach to investing and he's applying it five minutes later. I've never seen anyone who became a gradual convert over a ten-year period to this approach. It doesn't seem to be a matter of IQ or academic training. It's instant recognition, or it is nothing. and I'm convinced that there is much inefficiency in the market. These Graham-and-Doddsville investors have successfully exploited gaps between price and value. When the price of a stock can be influenced by a \"\"herd\"\" on Wall Street with prices set at the margin by the most emotional person, or the greediest person, or the most depressed person, it is hard to argue that the market always prices rationally. In fact, market prices are frequently nonsensical. and finally Success in investing doesn’t correlate with I.Q. once you’re above the level of 25. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing. There is almost no information on any who has helped Buffett internally or even managed Berkshire's investments aside from Louis Simpson. It is unlikely that Buffett has allowed anyone to manage much of Berkshire's investments considering the consistent stream of commentary from him claiming that he nearly does nothing except read annual reports all day to the extent that he may have neglected his family to some degree and that listening to others will more likely hurt performance than help with the most striking example being his father's recommendation that he not open a hedge fund after retiring from Graham-Newman because he believed the market was topping, and he absolutely idolized his father.\"", "title": "" }, { "docid": "db1ccbc57a778e7a93f06a6a95ab0dde", "text": "\"Consultant, I commend you for thinking about your financial future at such an early age. Warren Buffet, arguably the most successful investor ever lived, and the best known student of Ben Graham has a very simple advice for non-professional investors: \"\"Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard’s.)\"\" This quote is from his 2013 letter to shareholders. Source: http://www.berkshirehathaway.com/letters/2013ltr.pdf Buffet's annual letters to shareholders are the wealth of useful and practical wisdom for building one's financial future. The logic behind his advice is that most investors cannot consistently pick stock \"\"winners\"\", additionally, they are not able to predict timing of the market; hence, one has to simply stay in the market, and win over in the long run.\"", "title": "" }, { "docid": "2f59413ac77aa486091797a12cd9d78e", "text": "Robert Shiller published US Stock Market data from 1871. Ken French also has historical data on his website. Damodaran has a bunch of historical data, here is some historical S&P data.", "title": "" }, { "docid": "d4204f26bc88bab658ce2be226976e79", "text": "\"Since I, personally, agree with the investment thesis of Peter Schiff, I would take that sum and put it with him in a managed account, and leave it there. I'm not sure how to find a firm that you like the investment strategy of. I think that it's too complicated to do as a side thing. Someone needs to be spending a lot of time researching various instruments and figuring out what is undervalued or what is exposed to changing market trends or whatever. I basically just want to give my money to someone and say \"\"I agree with your investment philosophy, let me pay you to manage my money, too.\"\" No one knows who is right, of course. I think Schiff is right, so that's where I would put the amount of money you're talking about. If you disagree with his investment philosophy, this doesn't really make any sense to do. For that amount of money, though, I think firms would be willing to sit down with you and sell you their services. You could ask them how they would diversify this money given the goals that you have for it, and pick one that you agree with the most.\"", "title": "" }, { "docid": "96e87efceb5a4215d1e7cea3f5e0e75a", "text": "As the offshore planning world turns, the limited liability company (“LLC”) is starting to appear with greater frequency as an alternative to the conventional offshore asset protection trust. It is desirable because unlike the offshore trust, which requires an independent trustee, the LLC permits the client to remain in full control as the Manager of the entity. While the typical offshore trust provides the highest form of asset protection, the asset protection afforded by the LLC is significant, and with retained control, provides a powerful combination. Recently, St. Vincent and the Grenadines as well as Nevis, have sought to improve their legislation by offering superior LLC statutes. Each is progressive and will be desirable for planners and clients alike.", "title": "" }, { "docid": "9195bb2a2faa4f1aa9f86cdf0eb07809", "text": "If your gut told you to buy during the depths of '09, your gut might be well-calibrated. The problem is stock market declines during recessions are frequently not that large relative to the average long run return of 9%: A better strategy might be hold a percentage in equities based upon a probability distribution of historical returns. This becomes problematic because of changes in the definition of earnings and the recent inflation stability which has encouraged high valuations: Cash flow has not been as corrupted as earnings now, and might be a better indicator: This obviously isn't perfect either, but returns can be improved. Since there is no formulaic way yet conventionally available, the optimal primary strategy is still buy & hold which has made the most successful investor frequently one of the richest people on the planet for decades, but this could still be used as an auxiliary for cash management reserves during recessions once retired.", "title": "" }, { "docid": "c1492fef953735b5f6997e04a1d5492e", "text": "\"The professional financial advisors do have tools which will take a general description of a portfolio and run monte-carlo simulations based on the stock market's historical behavior. After about 100 simulation passes they can give a statistical statement about the probable returns, the risk involved in that strategy, and their confidence in these numbers. Note that they do not just use the historical data or individual stocks. There's no way to guarantee that the same historical accidents would have occurred that made one company more successful than another, or that they will again. \"\"Past performance is no guarantee of future results\"\"... but general trends and patterns can be roughly modelled. Which makes that a good fit for those of us buying index funds, less good for those who want to play at a greater level of detail in the hope of doing better. But that's sorta the point; to beat market rate of return with the same kind of statistical confidence takes a lot more work.\"", "title": "" }, { "docid": "9fe5ad3eedc808ab0e4263fced5aa946", "text": "There is a subtle difference. In an FDIC insured bank account, you are guaranteed to get all of your money back out. If you put $1000 into your bank account, you are guaranteed to be able to get at least $1000 back out when you want. The value of the account (in dollars) can never go down, for any reason. When you put money into a brokerage account, cash is typically invested in a money market fund. Money market funds are considered very safe investments, with low risk of loss (and a corresponding low rate of return). However, it is possible for the value of a money market fund to go down, and SIPC insurance does not cover that. What SIPC does cover is any sort of shenanigans that a broker might play on you. If they screw up and delete your account, or give your money to someone else, or close up shop and head to Grand Cayman, SIPC ensures that you will get your money back. But it does not cover investment losses.", "title": "" } ]	fiqa
ac942a5ad9e39874905e6925007f5cad	Should I close unused credit cards before applying for another?	[ { "docid": "14a8104cc721912796133a8399109750", "text": "If you're looking for cause-effect, applying for another card won't matter at all if you're not paying any interest, or not looking to get another installment loan for which the rate you get depends on your credit rating. If you are looking to get another installment loan, then having more credit at your disposal might hurt a small amount. I wouldn't want to cancel your oldest card. The GEMB card looks like a good candidate if you want to cancel because you're not using it, and it's a relatively new card.", "title": "" }, { "docid": "69972764b24f7e26ef9ebfed92a062e7", "text": "You want to have 2-4 credit cards, with a credit utilization ratio below 30%. If you only have 2 cards, closing 1 would reduce your credit diversity and thus lower your credit score. You also want at least 2 years credit history, so closing an older credit card may shorten your credit history, again lowering your credit score. You want to keep around at least 1-2 older cards, even if they are not the best. You have 4 cards: But having 2-4 cards (you have 4) means you can add a 5th, and then cancel one down to 4, or cancel one down to 3 and then add a 4th, for little net effect. Still, there will be effect, as you have decreased the age of your credit, and you have opened new credit (always a ding to your score). Do you have installment loans (cars), you mention a new mortgage, so you need to wait about 3 months after the most recent credit activity to let the effects of that change settle. You want both spouses to have separate credit cards, and that will increase the total available to 4-8. That would allow you to increase the number of benefits available.", "title": "" } ]	[ { "docid": "81d114ea295197e18a5c001af09566f2", "text": "I should apply for everything I can on the same day, get approved for as many as I can First it may not sound as easy. You may hardly get 2-3 cards and not dozens. Even if you submit the applications the same day; If you still plan this and somehow get too many cards, and draw huge debt, then the Banks can take this seriously and file court case. If Banks are able to establish the intent; this can get constituted as fraud and liable for criminal proceedings. So in short if someone has the money and don't want to pay; the court can attach the wage or other assets and make the person pay. If the intent was fraud one can even be sent to jail.", "title": "" }, { "docid": "312d32a49042514a7405bb87a35c97c5", "text": "I disagree with the reply. Your both impressions are correct. - Do not close old credit cards because they keep your credit rating high (fico score) - Also low utilization that credit cards report to credit rating companies, improves your rating.", "title": "" }, { "docid": "6d47872c305ac82a7baf1b8d3fd8b0b2", "text": "The difference in interest is not a huge factor in your decision. It's about $2 per month. Personally I would go ahead and knock one out since it's one less to worry about. Then I would cancel the account and cut that card up so you are not tempted to use it again. To address the comments... Cutting up the card is NOT the ultimate solution. The solution is to stop borrowing money... Get on a strict budget, live on less than what you bring home, and throw everything you can at this high-interest debt. The destroying of the card is partly symbolic - it's a gesture to indicate that you're not going to use credit cards at all, or at least until they can be used responsibly, not paying a DIME of interest. It's analogous to a recovering alcoholic pouring out bottles of booze. Sure you can easily get more, but it's a commitment to changing your attitude and behavior. Yes leaving the card open will reduce utilization and improve (or not hurt) credit score - but if the goal is to stop borrowing money and pay off the other card, then once that is achieved, your credit score will be significantly improved, and the cancelling of the first card will not matter. The card (really both cards) should never, ever be used again.", "title": "" }, { "docid": "c39644834b92aa943e87d1ec90e0826b", "text": "You don't need to use an open line of credit to help your credit score. You didn't ask this, but another option is to not cut up the card and keep the account open, even if you don't use it. I mention this because sometimes when you are calling in or setting up an online account to service the card, you may need to have the expiration date and CVV code on hand. This has burned me a few times as I had to hunt around for a card I rarely ever use. That being said, if you are worried that you might use the card if you know it's there, then sure, cut it up.", "title": "" }, { "docid": "884869eb776691173df3f901fce8830c", "text": "\"In the sole interest of improving your credit score, the thing you should focus on is lowering your overall utilization. The best thing you could do for this would be to get a loan to reconsolidate your credit card debts into a single, long term loan. The impact of this is that your credit card utilization, assuming the loan covers 100% of your balances, will suddenly drop to 0%, as you'll no longer have a balance on the cards. Additionally, at this point, with a consolidation loan, you'll be building loan history by making steady, fixed payments on the loan. The loan will also, ideally, have a significantly lower interest rate than the cards, and thus will save you money that you'd otherwise be spending on interest. A lot of others here will feed you some additonal, irrelevant advice - \"\"Pay off X credit card first!\"\"; Ideally, you need to eliminate this debt. But to directly address the question of how you could improve your credit score, based on your utilization, I believe the best option would be for you to reconsolidate your credit card debt into a single loan, to reduce your utilization on the cards.\"", "title": "" }, { "docid": "55e0198a883112249e659ac901527644", "text": "If you've got the money to pay off your credit cards, do it. Today, if possible. There is no need to pay another penny of interest to them. They may or may not cancel your cards. That is up to them. We can't know what will trigger an individual bank to cancel your card. The answers you got on your other question offer some speculation on why some banks might cancel, but this is not something banks reveal. Anything you do on your own to try to keep the cards open is just a guess, and may or may not succeed. But ask yourself: why do you want to keep these cards? Is it for the convenience of the card? I agree that credit cards (paid in full monthly) are convenient, but when they start costing you money, they aren't worth it anymore, in my opinion. Debit cards have most of the same conveniences of credit cards, and are free. If it is for emergencies, I recommend instead building up an emergency cash fund. That way, if an emergency arises, you won't be forced to borrow money at high credit card interest rates. If the reason you want to hang on to the credit card is so you can spend more than you have, then you will find yourself in the same situation again. If I were you, I would pay off the cards ASAP. If the banks cancel your cards, just switch to a debit card and be thankful that you are no longer continuously leaking money to the banks.", "title": "" }, { "docid": "cb85de0b7686d07f00729fa1f49c9002", "text": "The U.S. bankruptcy laws no longer make it simple to discharge credit card debt, so you can't simply run up a massive tab on credit cards and then just walk away from them anymore. That used to be the case, but that particular loophole no longer exists the way it once did. Further, you could face fraud charges if it can be proven you acted deliberately with the intent to commit fraud. Finally, you won't be able to rack up a ton of new cards as quickly as you might think, so your ability to amass enough to make your plan worth the risk is not as great as you seem to believe. As a closing note, don't do it. All you do is make it more expensive for the rest of us to carry credit cards. After all, the banks aren't going to eat the losses. They'll just pass them along in the form of higher fees and rates to the rest of us.", "title": "" }, { "docid": "cee1717f89673b8547c5a39ac02593d0", "text": "\"The only good reason I find to close cards are: it's a card with an annual fee that you don't need. No point bleeding money each year. churning rewards. Open card to get bonus promotion such as \"\"spend $500 in first 3 months, get $200 bonus\"\". Close card and open a year later to do that same bonus again if available. Many cards don't allow you to do this. making room for newer cards at the same bank. Example, you have 5 Chase Cards and you want to apply for a 6th. Chase says you have maximized your credit they will extend you. You close one of your existing cards to get that new card. I have seen that many banks allow you to shift over some over your existing available credit to your new card without having to close them.\"", "title": "" }, { "docid": "8630f5c40a3b7606a87642027ce64970", "text": "In your specific case, I would leave them open unless you have a specific reason for wanting to close them - particularly, unless you feel closing them is necessary for you to not misuse them. The impact on the credit score is not why I say this, though. Much more important are the two competing real factors: My suggestion would be to take the cards and put them in your file cabinet, or whatever would cause you to not use them. In fact, you could even cut them up but not close the accounts - I had an account open that I didn't possess a physical card for several years for and didn't use at all, and it stayed open (though it's not guaranteed they'll keep it open for you if you never use it). In an emergency you could then ask them to send you a new copy of the card very easily. But, keep them, just in case you need them. Once you have paid off your balances on your balance-carrying cards, then you should consider closing some of them. Keep enough to be able to live for ~4-6 months (a similar amount to the ideal rainy day fund in savings, basically) and then close others, particularly if you can do so in a way that keeps your average account age reasonably stable.", "title": "" }, { "docid": "39f6c48c7af1810a0a19a134191176db", "text": "I have a fair number of cards floating around some reasons I have opened multiple accounts. I am not saying that it is for everyone but there are valid scenarios where multiple credit cards can make sense.", "title": "" }, { "docid": "78ed499616a995e2d3a5153515793822", "text": "pay off one of the cards completely. there are several reasons why:", "title": "" }, { "docid": "d8a0ea3b3dde6eb528f6510f15113ddb", "text": "\"There are two factors in your credit score that may be affected. The first is payment history. Lenders like to see that you pay your bills, which is the most straightforward part of credit scores IMO. If you've actually been paying your bills on time, though, then this should still be fine. The second factor is the average age of your open accounts. Longer is considered better here because it means you have a history of paying your bills, and you aren't applying for a bunch of credit recently (in which case you may be taking on too much and will have difficulties paying them). If this card is closed, then it will no longer count for this calculation. If you don't have any other open credit accounts, then that means as soon as you open another one, your average age will be one day, and it will take a long time to get it to \"\"good\"\" levels; if you have other matured accounts, then those will balance out any new accounts so you don't get hit as much. Incidentally, this is one of the reasons why it's good to get cards without yearly fees, because you can keep them open for a long time even if you switch to using a different card primarily.\"", "title": "" }, { "docid": "cc7a3cd55d51deccd6a27bbb688ac464", "text": "Closing your oldest revolving account will lower your average age of accounts and hurt your score. No ifs, ands, or buts. The amount it drops is hard to tell, and it may only be a few points if your other cards are fairly old as well. While the FICO scoring algorithm is proprietary and hard to predict, you can use the official FICO Simulator to estimate the impact. Based on the information you provided (5+ cards, oldest card 5 years), your estimate is 750-800. Performing the same estimate and only changing the number of cards and age (2-4 cards, oldest card 2-4 years), the score estimate drops to 735-785. Both of these estimates assume you have 9% or less utilization. You can probably estimate that your score will drop at least 15 points. However, it may not matter to you whether your score is maximized. Once you get above a certain FICO score, it doesn't matter. For example, I recently refinanced a vehicle and asked the loan officer about their lowest APR, and found out that they required a 780 FICO for it. Kind of like the difference between getting a 91 or a 99 in a class, an A is an A. Some other factors you may want to consider before you make your choice:", "title": "" }, { "docid": "87f7466bc890563ee9345c8834bfb181", "text": "Also, unless I missed it and someone already mentioned it, do keep in mind the impact of these credit cards balances on your credit score. Over roughly 75% usage on a given credit account reflects badly on your score and has a pretty large impact on how your worthiness is calculated. It gives the impression that you are a person that lives month to month on cards, etc. If you could get both cards down to reasonable balances to where you could begin paying on them regularly and work them down over time, that will not only look incredible for your credit report but also immediately begin making your credit worthiness begin to raise due to the fact that you will not have accounts that (I'm assuming here) are at very high usage (over 75% of your total limit.) If you have to get one card knocked out just to get breathing room, and you're boxed in here -- or honestly even if the mental stress is causing you incredible hardship day to day, then I suppose blow one card out of the water, reassess and start getting to work on that second card. I hope this helped, I'm no expert, but I have had every kind of luck with credit cards and accounts you could think of, so I can only give my experience from the rubber-meets-the-road perspective. Good luck!", "title": "" }, { "docid": "c2bc1b4f5d84a8887f49785aa4c89002", "text": "Except for the fact that canceling credit cards will hurt your credit, either by increasing your utilization ratio or decreasing the length of your credit lines if you cancel the oldest card, which makes it that much harder to get the good interest rates available on other loans.", "title": "" } ]	fiqa
59d429c9bd39fad000cc1c34230df8ee	Highstreet bank fund, custom ETF or Nutmeg?	[ { "docid": "6733d9bb2f5cf453abc85a901eb8cb9f", "text": "It's a good question, I am amazed how few people ask this. To summarise: is it really worth paying substantial fees to arrange a generic investment though your high street bank? Almost certainly not. However, one caveat: You didn't mention what kind of fund(s) you want to invest in, or for how long. You also mention an “advice fee”. Are you actually getting financial advice – i.e. a personal recommendation relating to one or more specific investments, based on the investments' suitability for your circumstances – and are you content with the quality of that advice? If you are, it may be worth it. If they've advised you to choose this fund that has the potential to achieve your desired returns while matching the amount of risk you are willing to take, then the advice could be worth paying for. It entirely depends how much guidance you need. Or are you choosing your own fund anyway? It sounds to me like you have done some research on your own, you believe the building society adviser is “trying to sell” a fund and you aren't entirely convinced by their recommendation. If you are happy making your own investment decisions and are merely looking for a place to execute that trade, the deal you have described via your bank would almost certainly be poor value – and you're looking in the right places for an alternative. ~ ~ ~ On to the active-vs-passive fund debate: That AMC of 1.43% you mention would not be unreasonable for an actively managed fund that you strongly feel will outperform the market. However, you also mention ETFs (a passive type of fund) and believe that after charges they might offer at least as good net performance as many actively managed funds. Good point – although please note that many comparisons of this nature compare passives to all actively managed funds (the good and bad, including e.g. poorly managed life company funds). A better comparison would be to compare the fund managers you're considering vs. the benchmark – although obviously this is past performance and won't necessarily be repeated. At the crux of the matter is cost, of course. So if you're looking for low-cost funds, the cost of the platform is also significant. Therefore if you are comfortable going with a passive investment strategy, let's look at how much that might cost you on the platform you mentioned, Hargreaves Lansdown. Two of the most popular FTSE All-Share tracker funds among Hargreaves Lansdown clients are: (You'll notice they have slightly different performance btw. That's a funny thing with trackers. They all aim to track but have a slightly different way of trading to achieve it.) To hold either of these funds in a Hargreaves Lansdown account you'll also pay the 0.45% platform charge (this percentage tapers off for portolio values higher than £250,000 if you get that far). So in total to track the FTSE All Share with these funds through an HL account you would be paying: This gives you an indication of how much less you could pay to run a DIY portfolio based on passive funds. NB. Both the above are a 100% equities allocation with a large UK companies weighting, so won't suit a lower risk approach. You'll also end up invested indiscriminately in eg. mining, tobacco, oil companies, whoever's in the index – perhaps you'd prefer to be more selective. If you feel you need financial advice (with Nationwide) or portfolio management (with Nutmeg) you have to judge whether these services are worth the added charges. It sounds like you're not convinced! In which case, all the best with a low-cost passive funds strategy.", "title": "" }, { "docid": "cf470bd4321a593788bb0b83d84e07fd", "text": "And it's only as cheap as 1.78% if you stay with them 10 years! They'd love that. You can kind of tell they really want to lock you in for over 4 years. I also think it's daylight robbery, but as a self execution investor I tend to have to talk myself out of that belief by default to be fair. One can wonder too, why are there even 2 fixed (percentage wise) fees? They are desperate not to have one number that is too big sounding, either the advisor fee is a rip off because they have to do all the same analysis regardless, or you could take the view that it's the only valid fee as you're paying for a slice of something, where as the other fee is what? A share of the fixed costs? Well, isn't advising as essential as anything else? I actually think Nutmeg is OK, I've not used them or dealt with them in any way but they are, to a greater or lesser degree, what I've wished for to recommend to friends who don't want to DIY, which is a cheaper next generation online investment facility, and their fees drop significantly over 100K. Going by their claimed past performance and fee structure, whilst I'd like them to be cheaper, I personally think they are not a bad choice in the market.", "title": "" } ]	[ { "docid": "5cd9bf9eeeb4256ee79f6605e933f98c", "text": "\"I use TIAA-Cref for my 403(b) and Fidelity for my solo 401(k) and IRAs. I have previously used Vanguard and have also used other discount brokers for my IRA. All of these companies will charge you nothing for an IRA, so there's really no point in comparing cost in that respect. They are all the \"\"cheapest\"\" in this respect. Each one will allow you to purchase their mutual funds and those of their partners for free. They will charge you some kind of fee to invest in mutual funds of their competitors (like $35 or something). So the real question is this: which of these institutions offers the best mutual and index funds. While they are not the worst out there, you will find that TIAA-Cref are dominated by both Vanguard and Fidelity. The latter two offer far more and larger funds and their funds will always have lower expense ratios than their TIAA-Cref equivalent. If I could take my money out of TIAA-Cref and put it in Fidelity, I'd do so right now. BTW, you may or may not want to buy individual stocks or ETFs in your account. Vanguard will let you trade their ETFs for free, and they have lots. For other ETFs and stocks you will pay $7 or so (depends on your account size). Fidelity will give you free trades in the many iShares ETFs and charge you $5 for other trades. TIAA-Cref will not give you any free ETFs and will charge you $8 per trade. Each of these will give you investment advice for free, but that's about what it's worth as well. The quality of the advice will depend on who picks up the phone, not which institution you use. I would not make a decision based on this.\"", "title": "" }, { "docid": "322adf88e50cec540e2b289c981ad770", "text": "You can invest in a couple of Sharia-conform ETFs which are available in Germany and issued by Deutsche Bank (and other financial institutions). For instance, have a look at these ETFs: DB Sharia ETFs In addition, Kuveyt Turk Bank aims to become Germany's first Islamic bank offering Sharia conform investments (Reuters).", "title": "" }, { "docid": "cc24e47a60d165d352f7a2b8a84119ea", "text": "is There Anyway I can Avoid losing 6-10% per Trade. As My Current Investment House Has Charged & will Be taking 5% hit quarterly If Left Untouched Stop trading penny stocks. Take your investment elsewhere and put it in a low-fee index fund ETF. You'll probably get a better return on your money.", "title": "" }, { "docid": "94fd0ac68a72a65937095c6edeaedb74", "text": "Thanks very much. 12b1 is a form that explains how a fund uses that .25-1% fee, right? So that's part of the puzzle im getting at. I'm not necessarily trying to understand my net fees, but more who pays who and based off of what. For a quick example, betterment bought me a bunch of vanguard ETFs. That's cool. But vanguard underperformed vs their blackrock and ssga etfs. I get that vanguard has lower fees, but the return was less even taking those into account. I'm wondering, first what sort of kickback betterment got for buying those funds, inclusive of wholesale deals, education fees etc. I'm also wondering how this food chain goes up and down the sponsor, manager tree. I'm sure it's more than just splitting up that 1%", "title": "" }, { "docid": "adcbfc7ed50dda109ff508fe92da26ec", "text": "I'm honestly not well versed on healthcare ETFs. I have seen a few mentioned here and there on various threads around /r/investing and /r/wallstreetbets. My pro-Vanguard bias would lead me to looking most closely at VHT, but there seem to be [many other great looking picks](http://etfdb.com/type/sector/healthcare/) out there such as IBB, XLV, and IHI, among others. Right now I am generally concerned about valuations in technology and perhaps simply in general, but we'll see what happens. As I craft my goals for the near and long term, I would favor the defense industry ($ITA), technology (broad definition -- $VGT, $V, $AAPL, $BABA, various video games companies short term), healthcare (above), some specific international exposure (such as $EWGS), and boring stuff ($VOO, $VTI).", "title": "" }, { "docid": "b66b61ad11cadb30ca1d30f219290326", "text": "UNG United States Natural Gas Fund Natural Gas USO United States Oil Fund West Texas Intermediate Crude Oil UGA United States Gasoline Fund Gasoline DBO PowerShares DB Oil Fund West Texas Intermediate Crude Oil UHN United States Heating Oil Fund Heating Oil I believe these are as close as you'd get. I'd avoid the double return flavors as they do not track well at all. Update - I understand James' issue. An unmanaged single commodity ETF (for which it's impractical to take delivery and store) is always going to lag the spot price rise over time. And therefore, the claims of the ETF issuer aside, these products will almost certain fail over time. As shown above, When my underlying asset rises 50%, and I see 24% return, I'm not happy. Gold doesn't have this effect as the ETF GLD just buys gold, you can't really do that with oil.", "title": "" }, { "docid": "fbaf8f14b52cfeedf9a2bdeac8dc656c", "text": "They have ETFs for most of what you listed above. Except the deep-fried candy bars. You know that's just a distributed candy bar that is THEN fried right? They have a few religious ETFs as well as some socially responsible ones. There is no reason to make one based on a single person's preference though - ETFs make their money on fees. For that they need VOLUME. Move Volume = More Money Also, there are over 1,411 ETF's in the US as of 2014. That means there are a lot of options already. You could always create your own if you are a great salesperson though. Source", "title": "" }, { "docid": "0ca83c3e36e1885784afa32f64fee0ae", "text": "\"Save the effort. For personal finance purpose, just use the simple tools. For example, if you like P&G very much but you want to diversify with ETF, use: http://etfdb.com/stock/PG/ https://www.etfchannel.com/finder/?a=etfsholding&symbol=PG Pick a ETF with highest weighting. Replace \"\"PG\"\" in the link with other tickers.\"", "title": "" }, { "docid": "1b2dae65dd374866d9f3920425b49b6e", "text": "I'm not familiar with QQQ, but I'm guessing this is something like IShares Ftse 100 (see description here)", "title": "" }, { "docid": "746fadc47e6606d3a1730a15c59391f2", "text": "I just finished a high frequency trading project. Individuals can do it, but you need a lot of capital. You can get a managed server in Times Square for $1500/month, giving you access to 90% of the US exchanges that matter, their data farms are within 3 milliseconds of distance (latency). You can also get more servers in the same building as the exchanges, if you know where to look ;) thats all I can divulge good luck", "title": "" }, { "docid": "5a9de080444de75c710b8e60527623c7", "text": "\"I'm trying to understand how an ETF manager optimized it's own revenue. Here's an example that I'm trying to figure out. ETF firm has an agreement with GS for blocks of IBM. They have agreed on daily VWAP + 1% for execution price. Further, there is a commission schedule for 5 mils with GS. Come month end, ETF firm has to do a monthly rebalance. As such must buy 100,000 shares at IBM which goes for about $100 The commission for the trade is 100,000 * 5 mils = $500 in commission for that trade. I assume all of this is covered in the expense ratio. Such that if VWAP for the day was 100, then each share got executed to the ETF at 101 (VWAP+ %1) + .0005 (5 mils per share) = for a resultant 101.0005 cost basis The ETF then turns around and takes out (let's say) 1% as the expense ratio ($1.01005 per share) I think everything so far is pretty straight forward. Let me know if I missed something to this point. Now, this is what I'm trying to get my head around. ETF firm has a revenue sharing agreement as well as other \"\"relations\"\" with GS. One of which is 50% back on commissions as soft dollars. On top of that GS has a program where if you do a set amount of \"\"VWAP +\"\" trades you are eligible for their corporate well-being programs and other \"\"sponsorship\"\" of ETF's interests including helping to pay for marketing, rent, computers, etc. Does that happen? Do these disclosures exist somewhere?\"", "title": "" }, { "docid": "4b6b44831c59cf35dcdf3a81a0cb0e62", "text": "Where are you planning on buying this ETF? I'm guessing it's directly through Vanguard? If so, that's likely your first reason - the majority of brokerage accounts charge a commission per trade for ETFs (and equities) but not for mutual funds. Another reason is that people who work in the financial industry (brokerages, mutual fund companies, etc) have to request permission for every trade before placing an order. This applies to equities and ETFs but does not apply to mutual funds. It's common for a request to be denied (if the brokerage has inside information due to other business lines they'll block trading, if a mutual fund company is trading the same security they'll block trading, etc) without an explanation. This can happen for months. For these folks it's typically easier to use mutual funds. So, if someone can open an account with Vanguard and doesn't work in the financial industry then I agree with your premise. The Vanguard Admiral shares have a much lower expense, typically very close to their ETFs. Source: worked for a brokerage and mutual fund company", "title": "" }, { "docid": "d6153164b7170b645d40c4449f890c9b", "text": "I know of no way to answer your question without 'spamming' a particular investment. First off, if you are a USA citizen, max out your 401-K. Whatever your employer matches will be an immediate boost to your investment. Secondly, you want your our gains to be tax deferred. A 401-K is tax deferred as well as a traditional IRA. Thirdly, you probably want the safety of diversification. You achieve this by buying an ETF (or mutual fund) that then buys individual stocks. Now for the recommendation that may be called spamming by others : As REITs pass the tax liability on to you, and as an IRA is tax deferred, you can get stellar returns by buying a mREIT ETF. To get you started here are five: mREITs Lastly, avoid commissions by having your dividends automatically reinvested by using that feature at Scottrade. You will have to pay commissions on new purchases but your purchases from your dividend Reinvestment will be commission free. Edit: Taking my own advice I just entered orders to liquidate some positions so I would have the $ on hand to buy into MORL and get some of that sweet 29% dividend return.", "title": "" }, { "docid": "a7f7cafcede60bd36387d7995a2bf706", "text": "Bond MF/ETF comes in many flavour, one way to look at them is corporate, govt. (gilt/sovreign), money market (short term, overnight lending etc.), govt. backed bonds. The ETF/MFs that invest money in these are also different types. One way to evaluate an ETF/MF is to see where they invest your money. Corporate debts are by the highest coupon paying bonds, however, the chance of default is also greater, if you wish to invest in these, it is preferable to look at the ETF/MF's debt portfolio financial ratings (Moodies etc.). Govt. bonds are more stable and unless the govt. defaults (which happens more often than we would like to think), here also look for higher rating bonds portfolio that the fund/scheme carries. The govt. backed bonds are somewhat similar to sovreign bonds, however, these are issuesd by institutions which are backed by govt. (e.g. national railways, municipal bodies etc.), any fund/scheme that invests in these bonds could also be considered and similarly measured. The last are the short term money market related, which provides the least return but are very liquid. It is very difficult to answer how you should invest large sum on ETF/MFs that are bond oriented. However, from any investment perspective, it is better to spread your money. If I take your hypthetical case of 1M$, I would divide it into 100K$ pieces and invest in 10 different ETF/MF schemes of different flavour: Hope this helps.", "title": "" }, { "docid": "b50979677c09fcf89f32c9b7b1f9ee0c", "text": "Perfect competition would not be the outcome you want from this model, nor does it imply what you posit. It implies that there will be infinitely many firms, with free entry/exit, making zero profits. Bonds would then become a reason for exit if you had heterogeneous firms (but in perfect competition this is unlikely). In fact in equilibrium no would (probably) issue bonds. What it seems like you want is some sort of structured oligopoly, or a regulated cartel separated into regions. This might generate the bond market you have in mind, but it still does not take into account the relative risk of the bonds.", "title": "" } ]	fiqa
0bf3d509896fb84ae1a8d7d006858344	Unemployment Insurance Through Options	[ { "docid": "881d9743c9290902d46440ea7dadc826", "text": "This is a snapshot of the Jan '17 puts for XBI, the biotech index. The current price is $65.73. You can see that even the puts far out of the money are costly. The $40 put, if you get a fill at $3, means a 10X return if the index drops to $10. A 70X return for a mild, cyclic, drop isn't likely to happen. Sharing youtube links is an awful way to ask a question. The first was far too long to waste my time. The second was a reasonable 5 minutes, but with no example, only vague references to using puts to protect you in bad years. Proper asset allocation is more appropriate for the typical investor than any intricate option-based hedging strategy. I've successfully used option strategies on the up side, multiplying the returns on rising stocks, but have never been comfortable creating a series of puts to hit the jackpot in an awful year.", "title": "" }, { "docid": "ed460183cf106b3f7073e1a1c1d2a58e", "text": "That's not unemployment insurance. Because it's perfectly possible, and even likely, that your industry will do badly but you'll keep your job, or that your industry will do well but you'll lose your job anyway. Any bet you make to insure yourself against unemployment has to be individually about you -- there are no suitable proxies.", "title": "" }, { "docid": "f79729b222ca3a4907afedab96a66a58", "text": "Options do act, somewhat, like insurance.... However.... An insurance policy will not have such short term expiration time frames. A 20 year term life insurance policy can be thought of as insurance with an expiration. But the expiration on options is in weeks, not decades. So (IMO) options make terrible insurance policies because of the very short term expirations they have.", "title": "" } ]	[ { "docid": "a978da7bde624c5d93998b4f2d709006", "text": "Try wallstreetsurvivor.com It gives you $100k of pretend money when you sign up, using which you can take various courses on the website. It will teach you how to buy/sell stocks and build your portfolio. I am not sure if they do have Options Trading specifically, but their course line up is great!", "title": "" }, { "docid": "94ca522ac3e692fc40a81e334445cace", "text": "\"Many companies (particularly tech companies like Atlassian) grant their employees \"\"share options\"\" as part of their compensation. A share option is the right to buy a share in the company at a \"\"strike price\"\" specified when the option is granted. Typically these \"\"vest\"\" after 1-4 years so long as the employee stays with the company. Once they do vest, the employee can exercise them by paying the strike price - typically they'd do that if the shares are now more valuable. The amount they pay to exercise the option goes to the company and will show up in the $2.3 million quoted in the question.\"", "title": "" }, { "docid": "043403925d1b5a388d2882a62cad96ed", "text": "An option, by definition, is a guess about the future value of the stock. If you guess too aggressively, you lose the purchase price of the option; if you guess too conservatively, you may not take the option or may not gain as much as you might have. You need to figure out what you expect to happen, and how confident you are about it, against the cost of taking the option -- and be reasonably confident that the change in the stock's value will be at least large enough to cover the cost of buying into the game. Opinion: Unless you're comfortable with expectation values and bell curves around them, it's significantly easier to lose money on options than to profit on them. And I'm not convinced that even statisticians can really do this well. I've always been told that the best use for options is hedging an investment you've already made; treating them as your primary bet is gambling, not investment.", "title": "" }, { "docid": "6ec31ff25a842884336420f39e6b4a99", "text": "I am in a very similar situation as you (software engineer, high disposable income). Maximize your contributions to all tax-advantaged accounts first. From those accounts you can choose to invest in high risk funds. At your age and date-target funds will invest in riskier investments on your behalf; and they'll do it while avoiding the 30%+/- haircut that you'll be paying in taxes anyhow. If, after that, you're looking for bigger risk plays then look into a brokerage account that will let you buy and sell options. These are big risk swingers and they are sophisticated, complicated products which are used by many people who likely understand finance far better than you. You can make money with them but you should consider it akin to gambling. It might be more to your liking to maintain a long position in a stock and then trade options against your long position. Start with trading covered calls, then you could consider buying options (defined limited downside risk).", "title": "" }, { "docid": "b74872ff1d6568315871add9f2d6fd8a", "text": "\"Wait, correct me if I'm wrong, but this is how I thought it worked: \"\"say you work 40 hours a week \"\"during a recession, NO ONE GETS FIRED \"\"instead, they cut your hours \"\"from say 40 to 32 \"\"THEN unemployment benefits make up the difference in that eight hours you're not working \"\"then you get hired again\"\" This seems like the best system ever and something America should do. No one gets fired, and companies save oodles of money not training new workers.\"", "title": "" }, { "docid": "d4916cd81a9dcb96f03875d11897474b", "text": "I wouldn't choose any of the above. Buying stocks and staying long in my case is the cheapest way to go (retail brokerage commissions have just been getting cheaper and cheaper. ) The added costs of trading options make it even dicier for me, a retail investor, to take risks. To understand how to make money with options, I'd have to be much more sophisticated investor.", "title": "" }, { "docid": "bd46514c70ab8b5eb92be9dea2566c09", "text": "\"With 40% of your take-home available, you have a golden opportunity here. Actually two, and the second builds out easily from the first. Golden Opportunity # 1: Layoff Immunity Ok, not really immunity. Most people don't think of themselves getting laid off, and don't prepare. Of course it may not happen to you, but it can. It's happened to me twice. The layoff itself is an emotional burden (getting rejected is hard), but then you're suddenly faced with a gut-wrenching, \"\"how am I gonna pay the rent????\"\" If you have no savings, it's terrifying. Put yourself in that spot. Imagine that tomorrow, you're out of a job. For how many months could you pay your expenses with the money you have? Three months? One? Not even that? How about shooting for 12 months? It's really, really comforting to be able to say: \"\"I don't have to worry about it for a year\"\". 12 months saved up gives you emotional and financial stability, and it gives you options -- you don't have to take the first job that comes along. Now, saving 12 months of expenses is huge. But, you're in the wonderful spot where you can save 40% of your income. It would only take 2.5 years to save up a year's worth of income! But, actually, it's better than that. Because your 12-month Layoff Immunity fund doesn't have to include the amount for retirement, or taxes, or that 40% we're talking about. Your expenses are less than 60% of take-home -- you'd only need 12 months of that. So, you could have a fully funded 12-Month Layoff Immunity Fund only in a year and a half! Golden Opportunity #2: Freedom Fund Do you like your Job? Would you still do it, if you didn't need the money? If so, great. But if not, why not get yourself into a position where you don't need it? That is, build up enough money from saving and investing to where you can pay your expenses - forever - from your investments. The number to keep in mind is 25. Figure out your annual expenses, and multiply it by 25. That's the amount you'd need to never need a job again. (That works out to a 4% withdrawal rate, adjusting for inflation every year, with a low risk of running out of money. It's a rule of thumb, but smart people doing a lot of math worked it out.) Here you keep saving and investing that 40% in solid mutual funds in a regular, taxable account. Between your savings and the compounding returns off the investments, you could easily have a fully funded \"\"Freedom Fund\"\" by the time you're 50. In fact, by 45 isn't unreasonable. It could be even better. If you live in that high-rent area because of the job, and wouldn't mind living were the rents are lower once you quit, your target amount would be lower. Between that, working dedicatedly toward this goal, and maybe a little luck, you might even be able to do this by age 40. Final Thoughts There are other things you could put that money toward, like a house, of course. The key take-away here, is to save it, and invest it. You're in a unique position of being able to do that with 40% of your income. That's fabulous! But don't think it's the norm. Most people can't save that much, and, once you lose the ability to save that much, it's very difficult to get it back. Expenses creep in, lifestyle \"\"wants\"\" become \"\"needs\"\", and so on. If you get into the habit of spending it, it's very difficult to shrink your lifestyle back down - down to what right now you're perfectly comfortable with. So, spend some time figuring out what you want out of life -- and in the mean time, sock that 40% away.\"", "title": "" }, { "docid": "f1a7b6858e63a5f30b21e373e2d9d8e5", "text": "I was in your situation a few years ago and I discovered something that worked perfectly for me - a local health insurance broker. I met with her, discussed my needs, reviewed the options with her, then acted. She received a commission from the insurer, so it cost me nothing. I would certainly follow a similar approach again.", "title": "" }, { "docid": "d493e342de67cd15eb7e5bebb0da84ae", "text": "You've convinced me with your capital letters. How could I have been so blind? The average person on unemployment is there for 39 weeks. Not permanent. So, you're basing your argument on false data. Further, a certain portion of these are there not because of stigma, but because the industry in which they worked doesn't need the labor. Another portion is only actually looking for work in order to continue qualifying for unemployment, and will retire after the benefits run out. You're talking about making a truly significant policy change with real negative effects on many, many real people in order to help a part of the population that doesn't necessarily exist in the manner you imagine it does. From what I can tell, you have done nothing to arrive at your conclusions beyond feeling an emotional reaction with no actual sense of the data. Or any actual knowledge of economics.", "title": "" }, { "docid": "49fbb72ed332e7fb662e054bc6b27475", "text": "\"An option is an instrument that gives you the \"\"right\"\" (but not the obligation) to do something (if you are long). An American option gives you more \"\"rights\"\" (to exercise on more days) than a European option. The more \"\"rights,\"\" the greater the (theoretical) value of the option, all other things being equal, of course. That's just how options work. You could point to an ex post result, and and say that's not the case. But it is true ex ante.\"", "title": "" }, { "docid": "60a47bddacca3f0846c65b31dee5118f", "text": "\"There are quite a few regulations on \"\"Insider Trading\"\". Blackouts are one of the means companies adopt to comply with \"\"Insider Trading\"\" regulations, mandating employees to refrain from selling/buying during the notified period. Once you leave the employment: So unless there is an urgent need for you to sell/buy the options, wait for some time and then indulge in trade.\"", "title": "" }, { "docid": "9c6533602ce5b481f4d4b8fe01a45b3f", "text": "\"A number of sites provide delayed option chains online. Yahoo Finance is one example: I linked to Apple's chain, but to get one yourself, put the ticker you want in the search box, then click the \"\"options\"\" link in the sidebar that I called out in the image.\"", "title": "" }, { "docid": "ff2730e6c2396a4af2351222956d02ea", "text": "Not sure I agree. In your analogy, there was a car accident, or the closing of a position. So, yes, it is okay to claim on the insurance. Claiming and being granted unemployment requires that several very specific criteria are met on a continuing basis.", "title": "" }, { "docid": "e0e1da3c3c3547ae5780093afe39e3fb", "text": "Without commenting on your view of the TV market: Let's have a look at the main ways to get negative exposure: 1.Short the stocks Pros: Relatively Easy Cons: Interest rate, costs of shorting, linear bet 2.Options a. Write Calls b. Buy puts Pros: Convexity, leveraged, relatively cheap Cons: Zero Sum bet that expires with time, theta 3.Short Stock, Buy Puts, Write Calls Short X Units of each stock, Write calls on them , use call premiums to finance puts. Pros: 3x the power!, high kickout Cons: Unlimited pain", "title": "" }, { "docid": "0ccf4fabeb824d7b3def25056a99e2f2", "text": "You also need to remember that stock options usually become valueless if not exercised while an employee of the company. So if there is any chance that you will leave the company before an IPO, the effective value of the stock options is zero. That is the safest and least risky valuation of the stock options. With a Google or Facebook, stock options can be exercised and immediately sold, as they are publicly traded. In fact, they may give stock grants where you sell part of the grant to pay tax withholding. You can then sell the remainder of the grant for money at any time, even after you leave the company. You only need the option/grant to vest to take advantage of it. Valuing these at face value (current stock price) makes sense. That's at least a reasonable guess of future value. If you are absolutely sure that you will stay with the company until the IPO, then valuing the stock based on earnings can make sense. A ten million dollar profit can justify a hundred million dollar IPO market capitalization easily. Divide that by the number of shares outstanding and multiply by how many you get. If anything, that gives you a conservative estimate. I would still favor the big company offers though. As I said, they are immediately tradeable while this offer is effectively contingent on the IPO. If you leave before then, you get nothing. If they delay the IPO, you're stuck. You can't leave the company until then without sacrificing that portion of your compensation. That seems a big commitment to make.", "title": "" } ]	fiqa
2b0fedfa37f934f0ba9d35263c493ae9	Next steps for (not me): a recently-divorced single mom, in California, with a 2yr-old	[ { "docid": "0ffe5468bb8f39580d79fe2ce6da76bc", "text": "She should call 211. This is exactly how they help. The 2-1-1 service is run by the United Way, a nonprofit organization. The 2-1-1 service strives to be a clearinghouse for services within a local area.", "title": "" } ]	[ { "docid": "cba28f069f7f57d7d7b8325422faaf0e", "text": "You have multiple things going on some of which will work in opposite directions. This is a second job for the family so that their income will be added onto of the main income. This generally means that the 2nd income has too little tax withheld. The tax tables used by employers have no way of handling this situation. This 2nd job is being started part way though the tax year, so too much in taxes is withheld. If they make 2,000 a month for 4 months that would mean 8,000 in income; but the tax tables used by the employer withhold at the $24,000 per year rate. The third issue is the great variation in the number of hours per pay period. This means that too much is withheld in checks with the most hours, and too little in the ones with the least hours. For this year you have a reprieve. As long as you make the safe-harbor levels for federal withholding, you can avoid penalties when you file next spring. To do so just make sure that the withholding of all the jobs in the family equal or exceed the total income tax for the family last year. Note this isn't equal to last years withholding, or equal to the refund last year, but the total tax you should have paid. The general advice is to set the smaller income to have 0 exemptions, and use the W-4 for the larger income to make adjustments. In the past I have done this to make sure that we make the safe-harbor level. You can make adjustments in the new year once you know what the safe harbor goal is for the rest of the year.", "title": "" }, { "docid": "7407b9e79ca99ba376e7effcbc1f0a97", "text": "You say you're not on speaking terms: so you do it via your lawyer. You're divorced: so IMO your obligations are: a) To your kids b) Purely financial spousal support (if any) If she's irresponsible financially then maybe she isn't the best able to care for your children. Your lawyer ought to be able to tell you what the alternatives are (it's very state-specific so no general advice from the Internet, but if your lawyer can't do that then IMO you need a different lawyer who has more experience with divorce/custody cases).", "title": "" }, { "docid": "7f50b7eb81cea05336eed2222ab9bb91", "text": "She can find a landlord that doesn't do credit checks. Maybe on Craigslist? She may end up paying more, have a bigger security deposit, etc. She can get someone else (not you) to sit her down and explain to her frankly that she's messing things up for herself and her children by being a poor manager of her finances. As her credit score improves, more opportunities will open up for her. Co-signing the loan is an option, but I do think you're wise not to do that.", "title": "" }, { "docid": "ea644dd27f3b2afa63e02f3f282f44e9", "text": "This is an all too common problem and is not easy to resolve. Divorce agreements do not alter prior mortgage contracts. Most importantly, the bank is not required, and will not normally, remove the girlfriend from the mortgage even if she quitclaimed it to her Ex. If he has abandoned the property there is a good chance he will not make any more future payments. She should be prepared to make the payments if he doesn't or expect her credit to continue to deteriorate rapidly. She needs to contact her divorce attorney to review their mutual obligations. A court can issue orders to try to force the Ex to fulfill the divorce agreement. However, a court cannot impose a change to the mortgage obligations the borrowers made to the bank. Focus on this. It's far more important than adding her to a car loan or credit card. Sorry for the bad news. As for the car loan, it's best to leave her off the loan. You will get better terms without her as a joint owner. You can add her as an additional driver for insurance purposes. Adding her to your credit cards will help her credit but not a lot if the mortgage goes to default or foreclosure.", "title": "" }, { "docid": "df414047a4aeb337a3f7f42e8a3c734d", "text": "I think the statute of limitations is 2 years so I suspect that she may not qualify, also BOA was not the last bank to hold her mortgage. I doubt she'll receive anything. She's just glad the whole mess is behind her.", "title": "" }, { "docid": "2ac0c962a8e0fc8964131ea3692c84ea", "text": "\"I would suggest you do three things: If you do all three of these, the time will come when \"\"2 months off to go to Italy this winter and ride bikes through wine country\"\" is something you both want to do, can afford to do, and have arranged your lives to make it feasible. Or whatever wow-cool thing you might dream of. Buying a vacation property. Renovating an old house. The time may also come when you can take a chance on no income for 6 months to start a business that will give you more flexibility about when and where you work. Or when you can switch from working for a pay cheque to volunteering somewhere all day every day. You (as a couple) will have the freedom to make those kinds of decisions if you have that safety net of long term savings, as long as you also have a strong and happy relationship because you didn't spend 40 years arguing about money and whether or not you can afford things.\"", "title": "" }, { "docid": "77dcc778863aba98f8b6cece6db553d4", "text": "Your mother has a problem that is typical for a woman with children. She is trying to help her children have a good life, by sacrificing to get them to a point where they can live comfortably on their own. Though she has a difficult situation now, much of the problems come from a very few choices by her and her children, and her situation can be fixed. Let me point out a few of the reasons why she has come to this point: My mother is a single mom... she is turning 50 this summer... she has about $60k in school loans from the college I attended... she has payments of $500/month ($10k) to my sisters college... she lives on her own in a 2 bedroom apartment... Mother's current 'income statement', Income Essentials (total $3131, 71%, too high, goal $2200) Lifestyle (total $150, low, she should have $500-900 to live her life) Financial (total $1350, 31%) Some observations and suggestions: Even though the $1625 rents seems high, your mom might enjoy her apartment and consider part of her rent ($300) a lifestyle choice (spending money for time), and the higher rent may make sense. But the rent is high for her income. Your mom should be spending more on food, and budget $200/month. Your mom should be saving money for investments and retirement. She should be putting 10% into savings ($440), plus any IRA/401K pretax savings. Your sister should be paying for her own college. She should take her own student loans, so that her mother can save for retirement. And since she only has $10K left, an alternative would be that you could loan her the money, and she could repay you when she graduates (you have money, as you loaned your mother $8K). You should be repaying the $500/month on the $60K student loan your mother took to help you get through college. You have benefited from the education, and the increased opportunity the college education has given you. Now is the time to accept responsibility and pay your debts. You could at least agree to split the expense with her, and were you paying even $300/month (leaving $200 for her), that would still fix her budget. Your mom should get a car that is paid for and reduce her transportation expenses, until the $350/month debt is resolved. She should resolve to spend no more than $300/month for a car, and with $100/month for insurance be under 10% for her vehicle. Since your mother lives in the US (NJ) she could avoid the $350/month debt payment though BK. But since there are other solutions she could exercise to resolve her problems, this is probably not needed. You mom could consider sharing her apartment to share expenses. Paying $1625 for an apartment for one person seems extravagant. She might enjoy sharing her apartment with a room-mate. That is about it. Once her children take responsibility for their lives, your mom will have a manageable budget, and less stress in her life. Mother's revised 'income statement', Income Essentials (total $2721, 62%, high, need to reduce by $500) Lifestyle (total $450, 10%, low) Financial (total $990, 23%) While you and your sister have these changes, Summary of changes: Some rent is lifestyle, reduced car loan by $200, sister pays her college $500, you pay your college $300, mom saves 10% of her income. Once your sister graduates and starts to repay you for your help with her college, you can take over paying the remainder of your loans, saving your mom an additional $200/month.", "title": "" }, { "docid": "c4e4d18eeb2f79ae8f96b4938e906628", "text": "\"all the other answers are spot on, but look at it this way. really all you mean when you say \"\"building equity\"\" is \"\"accumulating wealth\"\". if that is the goal, then having her invest the money in a brokerage (e.g. ira) account makes a lot more sense. if you can't afford the apartment without her, then you can't afford to pay out her portion of the equity in the future. which means she is not building equity, you are just borrowing money from her. the safest and simplest thing for you to do is to agree on a number that does not include \"\"equity\"\". to be really safe, you might want to both sign something in writing that says she will never have an equity stake unless you agree to it in writing. it doesn't have to be anything fancy. in fact, the shorter the better. i am thinking about 3 sentences should do the trick. if you feel you absolutely have to borrow money from her on a monthly basis to afford your mortgage, then i recommend you make it an unsecured loan. just be sure to specify the interest rate (even if it is zero), and the repayment terms (and ideally, late payment penalties). again, nothing fancy, 10 sentences maybe. e.g. \"\"john doe will borrow x$ per month, until jane doe vacates the apartment. after such time, john doe will begin repaying the loan at y$ per month....\"\" that said, borrowing money from friends and family almost never turns out well. at the very least, you need to save up a few months of rent so that if you do break up, you have time to find another roommate. disclaimer: i do not have any state-issued professional licenses.\"", "title": "" }, { "docid": "a5a1055554174a3a49e1319ac76ef8e6", "text": "My opinion is to hold off. I don't see housing market rising anytime soon, possibly even going lower, so you don't have to worry about getting in before it rises. Pay off the credit card debt, maybe even earlier if possible, then that flexibility will be there, the divorce proceedings may have an end in sight, and therefore you'll know more about any outcomes from that. The economy is still shaky, the flexibility of renting may come in real handy.", "title": "" }, { "docid": "b1835f91f8b9806966935c892e68629a", "text": "\"This is the best tl;dr I could make, [original](https://story.californiasunday.com/cost-of-college) reduced by 98%. (I'm a bot) *** > Liz was 24 and halfway through her first semester at California State University, Long Beach. > Megan, who had dark hair and a regal bearing, had tumbled out of wealth and was dating a man who knew Liz&#039;s dad. After Megan&#039;s boyfriend - a meth user, she said - died, Liz&#039;s dad invited her to share Liz&#039;s small pink room without consulting his daughter. > It&#039;s on a scruffy stretch of Long Beach Boulevard near Oscar&#039;s Nails, a Wing Stop, and a weeded lot next to a building announcing WE BUY CARS. Neighbors refer to Megan as Liz&#039;s mom - &quot;You know Liz, the girl who sings.\"\" * [Extended Summary*](http://np.reddit.com/r/autotldr/comments/72utdo/the_college_try/) \| [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~217699 tl;drs so far.\"\") \| [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") \| Top* keywords: Liz^#1 Kersheral^#2 State^#3 more^#4 out^#5\"", "title": "" }, { "docid": "0ea41f22c4426b02f0021ef2c274a8e1", "text": "\"No hope for you, my friend. Your life is over. Smile. Not true at all. If there's anything America is all about it's redemption and starting over. In fact, starting over is our middle name: United Starting Over States of America. Ulysses Grant failed once as a farmer and twice as a businessman before he became, well, U.S. Grant, major hero and president. He also graduated near the bottom of his class at West Point -- as did Sen. John McCain from the Naval Academy. John F. Kennedy had basically a C+ average in high school and his daddy weaseled JFK's way into Harvard, and he didn't turn out too badly. Other than the assassination, I mean. The idea that your grades or your former life have much to do with your later life seems logical. But it's also not very accurate. Grades predict very little. Many people who screwed up pretty badly, later became very successful. So, stop even worrying about past grades or your silly DUI. If I were applying, in fact, I'd write my essay about redemption, mentioning the DUI as a life turning point and noting that you no longer drink because of it. Unlike some other college students, ahem ahem ahem. They may be relieved to hear from an older student who has reformed his life, a type of student colleges very much like as opposed to little 18 year old children who get drunk all the time of which they have quite enough, thank you very much. I'd also attack the bad grades from a few years ago problem by enrolling in a local college in some way (perhaps they have an extension program or maybe you have a junior college nearby). Take a group of solidly academic courses (perhaps including business course) and do very well in them. I'd take two or three at a time, giving you time to focus on them deeply. Do what you need to do to do well -- talk to the professor early in the course about the course themes and goals (and so they know who you are), work well ahead of time on all papers and edit, edit, edit them. Study like crazy for every test. Use available review books. Get a tutor if you need one, preferably someone at the college who has taken the class. Talk to others who have taken the class before you for their advice. Also talk to the professor about how best to review for each test -- meet with them a week before the test to \"\"go over\"\" your questions. A good approach is for you to say that you think \"\"such and such\"\" are the main themes so you'll be studying them for the test. Few professors can risk correcting you if those are not the main themes. This can be immensely helpful to you in getting your focused on what you need to study (meaning what they plan to ask about on the test). As a former teacher, I always corrected students who misunderstood major course themes or were focusing on trivia rather than larger issues and problems. This also sends the message that you are a hard worker, likely giving you some benefit of the doubt (\"\"89? Oh, heck, give him an A-\"\"). With a few tough courses with good grades behind you, you have a much stronger record to apply with. And this shows you are serious since you went out of your way to take these courses. Broader your view of \"\"top tier\"\" schools as many schools that are not in the Top Ten silliness will offer programs that are just as good. Then research your \"\"top tier\"\" schools to find out what kind of student they're looking for. Do they want someone who has done something different? Someone who took some time off (like you!) to travel and work? Emphasize this in your application. Emphasize your extra effort to take courses, your job, your maturity and experience. Colleges love that. Whatever kind of application essay you write, make it about your life and how it's shaped you, your outlook and your efforts. And make sure it's carefully edited -- not mistakes, no bad grammar, no spelling mistakes, etc. Perfect. Get and English teacher or someone you trust to advise you on it. No, of course you are not wasting your time. Just make every reasonable effort to make schools want to accept you, and every reasonable effort to prepare well for more college. That is, after all, all you can really do. Then whatever happens work hard and do your best.\"", "title": "" }, { "docid": "03be634e5e0f8a2b901bd06b7ee7e7b5", "text": "All I need to clear the CC debt I’m in is 6k. I couldn’t work when my baby was post-op and I can’t catch up no matter how I try and I swear to God I’m gonna steal it if I can’t figure out wtf to do soon. I work 50+ hours a week and pick up OT on sundays, and I want to be with my son otherwise but I know if I have to get a second job I could pay this off quicker but I will never see him. I know I failed using the CCs when I had to be home w him but there was no money, that was it. The cards were all zero balance and hadn’t been used in over two years but I didn’t know what else to do when he was sick. It kept us afloat. I’m back at work, we live modestly - are there people in the world who just meet people and realize they’re decent human beings and just give them money to be nice and help them out? No strings attached?", "title": "" }, { "docid": "3145167719724539c5deb2e619350ed0", "text": "I'm sorry, lowest point in 40 years was 2 years ago. My bad. I think the point still applies. Also the numbers are skewed because in the 50's many people believed that the mother not having to go to work was a sign of success.", "title": "" }, { "docid": "5e725b58b1b28fc1dfc5ca7b43ed7c8f", "text": "\"Did it show just your address, or was your name on it as well? You didn't share how long you've lived at the address either, so it makes me wonder whether a former tenant is the one who filed that paperwork. It's also possible that someone used your address when making a filing. Whether that was deliberate or accidental is hard to discern, as is their intent if it was intentional. It could be accidental -- someone picked \"\"CA\"\" for California when they meant to pick \"\"CO\"\" for Colorado or \"\"CT\"\" for Connecticut...These things do happen. It can't make you feel any better about the situation though. You should be able to go online to the California Secretary of State's website (here) and look up everything filed by the LLC with the state. That will show who the founders were and everything else that is a matter of public record on the LLC. At the very least, you can obtain the registered agent's name and address for the LLC, which you can then use to contact them and ask why your address is listed as the LLC's business address. Once you have that info, you can then contact the Secretary of State and tell them it isn't you so they can do whatever is necessary to correct this. This doesn't sound like a difficult matter to clear up, but it's important to do your homework first and gather as much information as you can before you call the state. Answering \"\"I don't know\"\" won't get you very far with them compared to having the best answers you can about where the mistake started. I hope this helps. Good luck!\"", "title": "" }, { "docid": "3e00c1083e5d0f95b58bbdb1a5f44a75", "text": "\"An unmarried person with a total U.S.-sourced earned income under $ 37,000 during the year 2016 is likely to owe: If the original poster is not an \"\"independent contractor\"\", and is not \"\"billing corp-to-corp\"\" then: In summary: References:\"", "title": "" } ]	fiqa
b6377c1a1c1319431d433e01c4bcf6f3	1099-MISC vs K-1 — duplicated numbers?	[ { "docid": "b3ee0d5539681aa6015fec07c1b27559", "text": "Well, you won't be double taxed based on what you described. Partners are taxed on income, typically distributions. Your gain in the partnership is not income. However, you were essentially given some money which you elected to invest in the partnership, so you need to pay tax on that money. The question becomes, are you being double taxed in another way? Your question doesn't explain how you invested, but pretty much the options are either a payroll deduction (some amount taken out of X paychecks or a bonus) or some other payment to you that was not treated as a payroll deduction. Given that you got a 1099, that suggests the latter. However, if the money was taken out as a payroll deduction - you've already paid taxes (via your W2)! So, I'd double check on that. Regarding why the numbers don't exactly match up - Your shares in the partnership likely transacted before the partnership valuation. Let's illustrate with an example. Say the partnership is currently worth $1000 with 100 outstanding shares. You put up $1000 and get 100 shares. Partnership is now worth $2000 with 200 outstanding shares. However, after a good year for the firm, it's valuation sets the firm's worth at $3000. Your gain is $1500 not $1000. You can also see if what happened was the firm's valuation went down, your gain would be less than your initial investment. If instead your shares transacted immediately after the valuation, then your gain and your cost to acquire the shares would be the same. So again, I'd suggest double checking on this - if your shares transacted after the valuation, there needs to be an explanation for the difference in your gain. For reference: http://smallbusiness.findlaw.com/incorporation-and-legal-structures/partnership-taxes.html And https://www.irs.gov/publications/p541/ar02.html Here you learn the purpose of the gain boxes on your K1 - tracking your capital basis should the partnership sell. Essentially, when the partnership is sold, you as a partner get some money. That money is then taxed. How much you pay will depend on what you received versus what the company was worth and whether your gain was long term or short term. This link doesn't go into that detail, but should give you a thread to pull. I'd also suggest reading more about partnerships and K1 and not just the IRS publications. Don't get me wrong, they're a good source of information, just also dense and sometimes tough to understand. Good luck and congrats.", "title": "" } ]	[ { "docid": "28ca8044728004376da120c7f572a56f", "text": "\"It doesn't generally matter, and I'm not sure if it is in fact in use by the IRS other than for general statistics (like \"\"this year 20% of MFJ returns were with one spouse being a 'homemaker'\"\"). They may be able to try and match the occupation and the general levels and types of income, but for self-employed there's a more precise and reliable field on Schedule C and for employees they don't really need to do this since everything is reported on W2 anyway. So I don't think they even bother or give a lot of value to such a metric. So yes, I'm joining the non-authoritative \"\"doesn't matter\"\" crowd.\"", "title": "" }, { "docid": "af504736fd19c5cd3ff3b7ffda83e9c1", "text": "You decide on a cost bases attribution yourself, per transaction (except for averaging for mutual funds, which if I remember correctly applies to all the positions). It is not a decision your broker makes. Broker only needs to know what you've decided to report it to the IRS on 1099, but if the broker reported wrong basis (because you didn't update your account settings properly, or for whatever else reason) you can always correct it on form 8949 (columns f/g).", "title": "" }, { "docid": "b2c2a2438b925a7ca203cf52bfabeaf3", "text": "You really shouldn't be using class tracking to keep business and personal operations separate. I'm pretty sure the IRS and courts frown upon this, and you're probably risking losing any limited liability you may have. And for keeping separate parts of the business separate, like say stores in a franchise, one approach would be subaccounts. Messy, I'm sure.", "title": "" }, { "docid": "88ec8414da1e0a42a4da03f9edf304eb", "text": "\"For MCD, the 47¢ is a regular dividend on preferred stock (see SEC filing here). Common stock holders are not eligible for this amount, so you need to exclude this amount. For KMB, there was a spin-off of Halyard Health. From their IR page on the spin-off: Kimberly-Clark will distribute one share of Halyard common stock for every eight shares of Kimberly-Clark common stock you own as of the close of business on the record date. The deal closed on 2014-11-03. At the time HYH was worth $37.97 per share, so with a 1:8 ratio this is worth about $4.75. Assuming you were able to sell your HYH shares at this price, the \"\"dividend\"\" in the data is something you want to keep. With all the different types of corporate actions, this data is extremely hard to keep clean. It looks like the Quandl source is lacking here, so you may need to consider looking at other vendors.\"", "title": "" }, { "docid": "aae960d23c9df2ece3adbc6604646ba6", "text": "\"If one looks at the \"\"Guide to Information Returns\"\" in the Form 1099 General Instructions (the instructions that the IRS provides to companies on how to fill out 1099 and other forms), it says that the 1099-B is due to recipient by February 15, with a footnote that says \"\"The due date is March 15 for reporting by trustees and middlemen of WHFITs.\"\" I doubt that exception applies, though it may. There's also a section in the instructions on \"\"Extension of time to furnish statements to recipients\"\" which says that a company can apply to the IRS to get an extension to this deadline if needed. I'm guessing that if you were told that there were \"\"complications\"\" that they may have applied for and been given this extension, though that's just a guess. While you could try calling the IRS if you want (and in fact, their web site does suggest calling them if you don't receive a W-2 or 1099-R by the end of February), my honest opinion is that they won't do much until mid-March anyway. Unfortunately, you're probably out of luck being able to file as early as you want to.\"", "title": "" }, { "docid": "91ffa5ed8478fc188d5928f275b34075", "text": "What happened is that they do not track (and report) your original cost basis for 1099-B purposes. That is because it is an RSU. Instead, they just reported gross proceeds ($5200) and $0 for everything else. On your Schedule D you adjust the basis to the correct one, and as a comment you add that it was reported on W2 of the previous year. You then report the correct $1200 gain. You keep the documentation you have to back this up in case of questions (which shouldn't happen, since it will match what was indeed reported on your W2).", "title": "" }, { "docid": "b5dca99a685e3a33d3939c04c8107c93", "text": "From the instructions: If you do not need to make any adjustments to the basis or type of gain or loss (short-term or long-term) reported to you on Form 1099-B (or substitute statement) or to your gain or loss for any transactions for which basis has been reported to the IRS (normally reported on Form 8949 with box A checked), you do not have to include those transactions on Form 8949. Instead, you can report summary information for those transactions directly on Schedule D. For more information, see Exception 1, later. However, in case of ESPP and RSU, it is likely that you actually do need to make adjustments. Since 2014, brokers are no longer required to track basis for these, so you better check that the calculations are correct. If the numbers are right and you just summarized instead of reporting each on a separate line, its probably not an issue. As long as the gains reported are correct, no-one will waste their time on you. If you missed several thousand dollars because of incorrect calculations, some might think you were intentionally trying to hide something by aggregating and may come after you.", "title": "" }, { "docid": "f3af1afbfbdf47f2c1f93b4371879912", "text": "There are many different types of 1099 forms. Since you are comparing it to a W-2, I'm assuming you are talking about a 1099-MISC form. Independent contractor income If you are a worker earning a salary or wage, your employer reports your annual earnings at year-end on Form W-2. However, if you are an independent contractor or self-employed you will receive a Form 1099-MISC from each client that pays you at least $600 during the tax year. For example, if you are a freelance writer, consultant or artist, you hire yourself out to individuals or companies on a contract basis. The income you receive from each job you take should be reported to you on Form 1099-MISC. When you prepare your tax return, the IRS requires you to report all of this income and pay income tax on it. So even if you receive a 1099-MISC form, you are required to pay taxes on it.", "title": "" }, { "docid": "69b86f3654b9194f188b80eabf2295ae", "text": "For purposes of the EIN the address is largely inconsequential. The IRS cannot (read: won't) recover the EIN if you fail to write it down after the website generates it for you. On your actual tax form the address is more consequential, and this is more so a question of consistency than anything. But an entity can purchase property anywhere and have a different address subsequent years. Paying the actual taxes means more than the semantical inconsistencies. The whole purpose of separate accounts is to make an audit easier, so even if someone imagines that some action (such as address ambiguity) automatically triggers an audit, all your earnings/purchases are not intermingled with personal stuff, which just streamlines the audit process. Consequences (or lack thereof) aside, physical means where physical property is. So if you have an actual mailing address in your state, you should go with that. Obviously, this depends on what arrangement you have with your registered agent, if all addresses are in Wyoming then use the Wyoming address and let the Registered Agent forward all your mail to you. Don't forget your $50 annual report in Wyoming ;) How did you open a business paypal without an EIN? Business bank accounts? Hm... this is for liability purposes...", "title": "" }, { "docid": "3700ea152d1680761ab5001bc0390c48", "text": "Reading IRS Regulations section 15a.453-1(c) more closely, I see that this was a contingent payment sale with a stated maximum selling price. Therefore, at the time of filing prior years, there was no way of knowing the final contingent payment would not be reached and thus the prior years were filed correctly and should not be amended. Those regulations go on to give an example of a sale with a stated maximum selling price where the maximum was not reached due to contingency and states that in such cases: When the maximum [payment] amount is subsequently reduced, the gross profit ratio will be recomputed with respect to payments received in or after the taxable year in which an event requiring reduction occurs. However, in this case, that would result in a negative gross profit ratio on line 19 of form 6252 which Turbo Tax reports should be a non-negative number. Looking further in the regulations, I found an example which relates to bankruptcy and a resulting loss in a subsequent year: For 1992 A will report a loss of $5 million attributable to the sale, taken at the time determined to be appropriate under the rules generally applicable to worthless debts. Therefore, I used a gross profit ratio of zero on line 19 and entered a separate stock sale not reported on a 1099-B as a worthless stock on Form 8949 as a capital loss based upon the remaining basis in the stock sold in an installment sale. I also included an explanatory statement with my return to the IRS stating: In 2008, I entered into an installment sale of stock. The sale was a contingent payment sale with a stated maximum selling price. The sales price did not reach the agreed upon maximum sales price due to some contingencies not being met. According to the IRS Regulations section 15a.453-1(c) my basis in the stock remains at $500 in 2012 after the final payment. Rather than using a negative gross profit ratio on line 19 of form 6252, I'm using a zero ratio and treating the remaining basis as a schedule-D loss similar to worthless stock since the sale is now complete and my remaining basis is no longer recoverable.", "title": "" }, { "docid": "5aa15dc16f13f6e5780c55aa815a7dde", "text": "This sounds like a rental fee as described in the instructions for the 1099-MISC. Enter amounts of $600 or more for all types of rents, such as any of the following. ... Non-Employee compensation does not seem appropriate because you did not perform a service. You mention that your tax-preparer brought this up. I think you will need to consult with a CPA to receive a more reliable opinion. Make sure to bring the contract that describes the situation with you. From there, you may need to consult a tax attorney, but the CPA should be able to help you figure out what your next step is.", "title": "" }, { "docid": "02292628aef5bf27e8c5d0b8201e263a", "text": "Phil's answer is correct. Just to add to his response: Distributions are not taxable events -- you already paid your taxes, so you can take out $50k or $52k and the IRS is not concerned. You can simply write yourself a check for any amount you choose! To answer your specific question: to match your K1 losses and profit exactly, you could take out $50k. But that might leave the business strapped for cash. One way to decide how much to take out is to use your balance sheet. Look at your retained earnings (or just look at the business bank account balance), subtract however much cash you think you need to keep on hand for operations, and write yourself a check for the rest.", "title": "" }, { "docid": "ee0f34fa27cb4ca84be860d651f060f3", "text": "You tagged with S-Corp, so I assume that you have that tax status. Under that situation, you don't get taxed on distributions regardless of what you call them. You get taxed on the portion of the net income that is attributable to you through the Schedule K that the S-Corp should distribute to you when the S-Corp files its tax return. You get taxed on that income whether or not it's distributed. If you also work for the small business, then you need to pay yourself a reasonable wage. The amount that you distribute can be one factor in determining reasonableness. That doesn't seem to be what you asked, but it is something to consider.", "title": "" }, { "docid": "5d256f69d73c1c1546971bffb32a663d", "text": "\"I disagree with the other respondents. If your tenant is an individual, renting in their individual capacity, there is no reason they need your SSN. They will not be sending a 1099 to you. If your tenant is a business, then your property is not a residential property. It is at least a \"\"corporate housing\"\", and you would have noticed that the contract was signed by a company representative in the capacity of being a company representative, not an individual person. In that case, that representative would also ask you to fill a form W9, on which your tax ID should be reported. I would suggest let the tenant figure out their tax avoidance issues without you being involved.\"", "title": "" }, { "docid": "fcb2df2969c498e8cc9787fb8e1c130e", "text": "I was only able to find Maryland form 1 to fit your question, so I'll assume you're referring to this form. Note the requirement: Generally all tangible personal property owned, leased, consigned or used by the business and located within the State of Maryland on January 1, 201 must be reported. Software license (whether time limited or not, i.e.: what you consider as rental vs purchase) is not tangible property, same goes to the license for the course materials. Note, with digital media - you don't own the content, you merely paid for the license to use it. Design books may be reportable as personal tangible property, and from your list that's the only thing I think should be reported. However, having never stepped a foot in Maryland and having never seen (or even heard of) this ridiculous form before, I'd suggest you verify my humble opinion with a tax adviser (EA/CPA) licensed in the State of Maryland to confirm my understanding of this form.", "title": "" } ]	fiqa
198cd7e5b10ed8adfddf1c5ff06f0bb7	Construction loan for new house replacing existing mortgaged house?	[ { "docid": "441cb33517b78809ab0bb9a2dcf44c46", "text": "So let's assume some values to better explain this. For simplicity, all of these are in thousands: So in this example, you're going to destroy $250 in value, pay off the existing $150 loan and have to invest $300 in to build the new house and this example doesn't have enough equity to cover it. You typically can't get a loan for much more than the (anticipated) property value. Basically, you need to get a construction loan to cover paying off the existing loan plus whatever you want to spend to pay for the new house minus whatever you're planning to contribute from savings. This new loan will need to be for less than the new total market value. The only way this will work out this way is if you bring significant cash to closing, or you owe less than the lot value on the current property. Note, that this is in effect a simplification. You can spend less building a house than it's worth when you're done with it, etc., but this is the basic way it would work - or NOT work in most cases.", "title": "" }, { "docid": "d43fcc68268ff0da832453bd4ae2fc5f", "text": "\"Presumably the existing house has some value. If you demolish the existing house, you are destroying that value. If the value of the new house is significantly more than the value of the old house, like if you're talking about replacing a small, run-down old house worth $50,000 with a big new mansion worth $10,000,000, then the value of the old house that is destroyed might just get lost in the rounding errors for all practical purposes. But otherwise, I don't see how you would do this without bringing cash to the table basically equal to what you still owe on the old house. Presumably the new house is worth more than the old, so the value of the property when you're done will be more than it was before. But will the value of the property be more than the old mortgage plus the new mortgage? Unless the old mortgage was almost paid off, or you bring a bunch of cash, the answer is almost certainly \"\"no\"\". Note that from the lienholder's point of view, you are not \"\"temporarily\"\" reducing the value of the property. You are permanently reducing it. The bank that makes the new loan will have a lien on the new house. I don't know what the law says about this, but you would have to either, (a) deliberately destroy property that someone else has a lien on while giving them no compensation, or (b) give two banks a lien on the same property. I wouldn't think either option would be legal. Normally when people tear down a building to put up a new building, it's because the value of the old building is so low as to be negligible compared to the value of the new building. Either the old building is run-down and getting it into decent shape would cost more than tearing it down and putting up a new building, or at least there is some benefit -- real or perceived -- to the new building that makes this worth it.\"", "title": "" } ]	[ { "docid": "97a18181ea7766c38540dd8c3eadfd38", "text": "Just as a renter doesn't care what the landlord's mortgage is, the buyer of a house shouldn't care what the seller paid, what the current mortgage is, or any other details of the seller's finances. Two identical houses may be worth $400K. One still has a $450K loan, the other is mortgage free. You would qualify for the same value mortgage on both houses. All you and your bank should care about is that the present mortgage is paid or forgiven by the current mortgage holder so your bank can have first lien, and you get a clean title. To answer the question clearly, yes, it's common for a house with a mortgage to be sold, mortgage paid off, and new mortgage put in place. The profit or loss of the homeowner is not your concern.", "title": "" }, { "docid": "1ce16917eb1b24ba0bc42750a62d3cad", "text": "\"This is the best tl;dr I could make, [original](http://www.news.com.au/finance/economy/australian-economy/issuing-new-loans-against-unrealised-capital-gains-has-created-an-australian-house-of-cards/news-story/853e540ce0a8ed95d5881a730b6ed2c9) reduced by 87%. (I'm a bot) *** > THE Australian mortgage market has &quot;Ballooned&quot; due to banks issuing new loans against unrealised capital gains of existing investment properties, creating a $1.7 trillion &quot;House of cards&quot;, a new report warns. > The report describes the system as a &quot;Classic mortgage Ponzi finance model&quot;, with newly purchased properties often generating net rental income losses, adversely impacting upon cash flows. > Melbourne&#039;s median house price has risen by 12.7 per cent over the past year to $695,500, with Brisbane up 3 per cent to $488,757, Adelaide 5.2 per cent to $430,109, Hobart 13.6 per cent to $383,438 and Canberra 12.9 per cent to $575,173. * [Extended Summary*](http://np.reddit.com/r/autotldr/comments/6z9ea1/issuing_new_loans_against_unrealised_capital/) \| [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~207582 tl;drs so far.\"\") \| [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") \| Top* keywords: property^#1 per^#2 cent^#3 report^#4 market^#5\"", "title": "" }, { "docid": "250a7730477a33972e154998d713b752", "text": "You're in the same situation I'm in (bought new house, didn't sell old house, now renting out old house). Assuming that everything is stable, right now I'd do something besides pay down your new mortgage. If you pay down the mortgage at your old house, that mortgage payment will go away faster than if you paid down the one on the new house. Then, things start to get fun. You then have a lot more free cash flow available to do whatever you like. I'd tend to do that before searching for other investments. Then, once you have the free cash flow, you can look for other investments (probably a wise risk) or retire the mortgage on your residence earlier.", "title": "" }, { "docid": "6a30438a8e0fe678ad8874732fadef31", "text": "In short, your scenario could work in theory, but is not realistic... Generally speaking, you can borrow up to some percentage of the value of the property, usually 80-90% though it can vary based on many factors. So if your property currently has a value of $100k, you could theoretically borrow a total of $80-90k against it. So how much you can get at any given time depends on the current value as compared to how much you owe. A simple way to ballpark it would be to use this formula: (CurrentValue * PercentageAllowed) - CurrentMortgageBalance = EquityAvailable. If your available equity allowed you to borrow what you wanted, and you then applied it to additions/renovations, your base property value would (hopefully) increase. However as other people mentioned, you very rarely get a value increase that is near what you put into the improvements, and it is not uncommon for improvements to have no significant impact on the overall value. Just because you like something about your improvements doesn't mean the market will agree. Just for the sake of argument though, lets say you find the magic combination of improvements that increases the property value in line with their cost. If such a feat were accomplished, your $40k improvement on a $100k property would mean it is now worth $140k. Let us further stipulate that your $40k loan to fund the improvements put you at a 90% loan to value ratio. So prior to starting the improvements you owed $90k on a $100k property. After completing the work you would owe $90k on what is now a $140k property, putting you at a loan to value ratio of ~64%. Meaning you theoretically have 26% equity available to borrow against to get back to the 90% level, or roughly $36k. Note that this is 10% less than the increase in the property value. Meaning that you are in the realm of diminishing returns and each iteration through this process would net you less working capital. The real picture is actually a fair amount worse than outlined in the above ideal scenario as we have yet to account for any of the costs involved in obtaining the financing or the decreases in your credit score which would likely accompany such a pattern. Each time you go back to the bank asking for more money, they are going to charge you for new appraisals and all of the other fees that come out at closing. Also each time you ask them for more money they are going to rerun your credit, and see the additional inquires and associated debt stacking up, which in turn drops your score, which prompts the banks to offer higher interest rates and/or charge higher fees... Also, when a bank loans against a property that is already securing another debt, they are generally putting themselves at the back of the line in terms of their claim on the property in case of default. In my experience it is very rare to find a lender that is willing to put themselves third in line, much less any farther back. Generally if you were to ask for such a loan, the bank would insist that the prior commitments be paid off before they would lend to you. Meaning the bank that you ask for the $36k noted above would likely respond by saying they will loan you $70k provided that $40k of it goes directly to paying off the previous equity line.", "title": "" }, { "docid": "623dfa0df8931700ed0fa255c994972d", "text": "\"This seems to be a very emotional thing for people and there are a lot of conflicting answers. I agree with JoeTaxpayer in general but I think it's worth coming at it from a slightly different angle. You are in Canada and you don't get to deduct anything for your mortgage interest like in the US, so that simplifies things a bit. The next thing to consider is that in an amortized mortgage, the later payments include increasingly more principal. This matters because the extra payments you make earlier in the loan have much more impact on reducing your interest than those made at the end of the loan. Why does that matter? Let's say for example, your loan was for $100K and you will end up getting $150K for the sale after all the transaction costs. Consider two scenarios: If you do the math, you'll see that the total is the same in both scenarios. Nominally, $50K of equity is worth the same as $50K in the bank. \"\"But wait!\"\" you protest, \"\"what about the interest on the loan?\"\" For sure, you likely won't get 2.89% on money in a bank account in this environment. But there's a big difference between money in the bank and equity in your house: you can't withdraw part of your equity. You either have to sell the house (which takes time) or you have to take out a loan against your equity which is likely going to be more expensive than your current loan. This is the basic reasoning behind the advice to have a certain period of time covered. 4 months isn't terrible but you could have more of a cushion. Consider things like upcoming maintenance or improvements on the house. Are you going to need a new roof before you move? New driveway or landscape improvements? Having enough cash to make a down-payment on your next home can be a huge advantage because you can make a non-contingent offer which will often be accepted at a lower value than a contingent offer. By putting this money into your home equity, you essentially make it inaccessible and there's an opportunity cost to that. You will also earn exact 0% on that equity. The only benefit you get is to reduce a loan which is charging you a tiny rate that you are unlikely to get again any time soon. I would take that extra cash and build more cushion. I would also put as much money into any tax sheltered investments as you can. You should expect to earn more than 2.89% on your long-term investments. You really aren't in debt as far as the house goes as long as you are not underwater on the loan: the net value of that asset is positive on your balance sheet. Yes you need to keep making payments but a big account balance covers that. In fact if you hit on hard times and you've put all your extra cash into equity, you might ironically not being able to make your payments and lose the home. One thing I just realized is that since you are in Canada, you probably don't have a fixed-rate on your mortgage. A variable-rate loan does make the calculation different. If you are concerned that rates may spike significantly, I think you still want to increase your cushion but whether you want to increase long-term investments depends on your risk tolerance.\"", "title": "" }, { "docid": "b93a5d77409254fa60210ce84930525a", "text": "\"The first red-flag here is that an appraisal was not performed on an as-is basis - and if it could not be done, you should be told why. Getting an appraisal on an after-improvement basis only makes sense if you are proposing to perform such improvements and want that factored in as a basis of the loan. It seems very bizarre to me that a mortgage lender would do this without any explanation at all. The only way this makes sense is if the lender is only offering you a loan with specific underwriting guidelines on house quality (common with for instance VA-loans and how they require the roof be of a certain maximum age - among dozens of other requirements, and many loan products have their own standards). This should have been disclosed to you during the process, but one can certainly never assume anyone will do their job properly - or it may have only mentioned in some small print as part of pounds of paper products you may have been offered or made to sign already. The bank criteria is \"\"reasonable\"\" to the extent that generally mortgage companies are allowed to set underwriting criteria about the current condition of the house. It doesn't need to be reasonable to you personally, or any of us - it's to protect lender profits by aiding their risk models. Your plans and preferences don't even factor in to their guidelines. Not all criteria are on a a sliding scale, so it doesn't necessarily matter how well you meet their other standards. You are of course correct that paying for thousands of dollars in improvements on a house you don't own is lunacy, and the fact that this was suggested may on it's own suggest you should cut your losses now and seek out a different lender. Given the lender being uncooperative, the only reason to stick with it seems to be the sunk cost of the appraisal you've already paid for. I'd suggest you specifically ask them why they did not perform an as-is appraisal, and listen to the answer (if you can get one). You can try to contact the appraiser directly as well with this question, and ask if you can have the appraisal strictly as-is without having a new appraisal. They might be helpful, they might not. As for taking the appraisal with you to a new bank, you might be able to do this - or you might not. It is strictly up to each lender to set criteria for appraisals they accept, but I've certainly known of people re-using an appraisal done sufficiently recently in this way. It's a possibility that you will need to write off the $800 as an \"\"education expense\"\", but it's certainly worth trying to see if you can salvage it and take it with you - you'll just have to ask each potential lender, as I've heard it go both ways. It's not a crazy or super-rare request - lenders backing out based on appraisal results should be absolutely normal to anyone in the finance business. To do this, you can just state plainly the situation. You paid for an appraisal and the previous lender fell through, and so you would like to know if they would be able to accept that and provide you with a loan without having to buy a whole new appraisal. This would also be a good time to talk about condition requirements, in that you want a loan on an as-is basic for a house that is inhabitable but needs cosmetic repair, and you plan to do this in cash on your own time after the purchase closes. Some lenders will be happy to do this at below 75%-80% LTV, and some absolutely do not want to make this type of loan because the house isn't in perfect condition and that's just what their lending criteria is right now. Based on description alone, I don't think you really should need to go into alternate plans like buy cash and then get a home equity loan to get cash out, special rehab packages, etc. So I'd encourage you to try a more straight-forward option of a different lender, as well as trying to get a straight answer on their odd choice of appraisal order that you paid for, before trying anything more exotic or totally changing your purchase/finance plans.\"", "title": "" }, { "docid": "7e907d422e9d3d798ba1f276f896040e", "text": "\"Assumption - you live in a country like Australia, which has \"\"recourse\"\" mortgages. If you buy the apartment and take out a mortgage, the bank doesn't care too much if your apartment gets built or not. If the construction fails, you still owe the bank the money.\"", "title": "" }, { "docid": "f9ea72f98104d3270a942ed21b839709", "text": "You could consider turning your current place into a Rental Property. This is more easily done with a fixed rate loan, and you said you have an ARM. The way it would work: If you can charge enough rent to cover your current mortgage plus the interest-difference on your new mortgage, then the income from your rental property can effectively lower the interest rate on your new home. By keeping your current low rate, month-after-month, you'll pay the market rate on your new home, but you'll also receive rental income from your previous home to offset the increased cost. Granted, a lot of your value will be locked up in equity in your former home, and not be easily accessible (except through a HELOC or similar), but if you can afford it, it is a good possibility.", "title": "" }, { "docid": "c805b4bd5c0bdcc9a481645e470d3ae8", "text": "You're effectively looking for a mortgage for a new self-build house. At the beginning, you should be able to get a mortgage based on the value of the land only. They may be willing to lend more as the build progresses. Try to find a company that specializes in this sort of mortgage.", "title": "" }, { "docid": "3110b4b6766a0e1dac9a4b4944d29138", "text": "\"Construction loans are typically short term that then get rolled into conventional mortgages at the end of the construction period. Since the actual construction loan is short term, you cannot combine it with a long-term land loan as well. You could do the two separate loans up front to buy the land and finance the construction, then at the end roll both into a conventional mortgage to close out the land and construction loans. This option will only work if you do all three through the same lender. Trying to engage various lenders will require a whole new refinance process, which I very much doubt you would want to go through. These are sometimes called combo loans, since they aggregate several different loan products in one \"\"transaction.\"\" Not a lot of places do land loans, so I would suggest first find a lender that will give you a land loan and set an appoint with a loan representative. Explain what you are trying to do and see what they can offer you. You might have better luck with credit unions as well instead of traditional banks.\"", "title": "" }, { "docid": "7f398ad2294afdfaf8c2e0f39a65b251", "text": "The underlying investment is usually somewhat independent of your mortgage, since it encompasses a bundle of mortgages, and not only yours. It works similarly to a fund. When, you pay off the old mortgage while re-financing, the fund receives the outstanding debt in from of cash, which can be used to buy new mortgages.", "title": "" }, { "docid": "b22c2489d586e3c1cfc01bb3f21219c3", "text": "If you intend to flip this property, you might consider either a construction loan or private money. A construction loan allows you to borrow from a bank against the value of the finished house a little at a time. As each stage of the construction/repairs are completed, the bank releases more funds to you. Interest accrues during the construction, but no payments need to be made until the construction/repairs are complete. Private money works in a similar manner, but the full amount can be released to you at once so you can get the repairs done more quickly. The interest rate will be higher. If you are flipping, then this higher interest rate is simply a cost of doing business. Since it's a private loan, you ca structure the deal any way you want. Perhaps accruing interest until the property is sold and then paying it back as a single balloon payment on sale of the property. To find private money, contact a mortgage broker and tell them what you have in mind. If you're intending to keep the property for yourself, private money is still an option. Once the repairs are complete, have the bank reassess the property value and refinance based on the new amount. Pay back the private loan with equity pulled from the house and all the shiny new repairs.", "title": "" }, { "docid": "e5d0aae8c372fa841d206c133d72eb68", "text": "The cleanest way to accomplish this is to make the purchase of your new house contingent on the sale of your old one. Your offer should include that contingency and a date by which your house needs to sell to settle the contract. There will also likely be a clause that lets the seller cancel the contract within a period of time (like 24-48 hours) if another offer is received. This gives you (the buyer) at least an opportunity to either sell the house or come up with financing to complete the deal. For example, suppose you make an offer to buy a house for $300,000 contingent on the sale of your house, which the seller accepts. In the meantime, the seller gets an offer of $275,000 in cash (no contingency). The seller has to notify you of the offer and give you some time to make good on your offer, either by selling your house or obtaining $300,000 in financing. If you cannot, the seller can accept the cash offer. This is just a hypothetical example; the offer can have whatever clauses you agree to, but since sale contingencies benefit the buyer, the seller will generally want some compensation for that benefit, e.g. a larger offer or some other clause that benefits them. Or do I find a house to buy first, set a closing date far out and then use that time to sell my current one? Most sellers will not want to set a closing date very far out. Contingency clauses are far more common. In short, yes it's possible, and any competent realtor should be able to handle it. It also may mean that you have to either make a higher offer to compensate for the contingency and to dissuade the seller from entertaining other offers, or sell your home for less than you'd like to get the cash sooner. You can weigh those costs against the cost of financing the new house until yours sells.", "title": "" }, { "docid": "928f578d51d5e2b352fe5022b90e524e", "text": "If they own the old house outright, they can mortgage it to you. In many jurisdictions this relieves you of the obligation to chase for payment, and of any worry that you won't get paid, because a transfer of ownership to the new owner cannot be registered until any charge against a property (ie. a mortgage) has been discharged. The cost of to your friends of setting up the mortgage will be less than the opulent interest they are offering you, and you will both have peace of mind. Even if the sale of the old house falls through, you will still be its mortgagee and still assured of repayment on any future sale (or even inheritance). Complications arise if the first property is mortgaged. Although second mortgages are possible (and rank behind first mortgages in priority of repayment) the first mortgagee generally has a veto on the creation of second mortgages.", "title": "" }, { "docid": "7ded606c0cebdfa826fce881e5532323", "text": "\"To some extent, I suppose, most people are okay with paying Some taxes. But, as they teach in Intro to Economics, \"\"Decisions are made on the margin\"\". Few are honestly expecting to get away with paying no taxes at all. They are instead concerned about how much they spend on taxes, and how effectively. The classic defense of taxes says \"\"Roads and national defense and education and fire safety are all important.\"\" This is not really the problem that people have with taxes. People have problems with gigantic ongoing infrastructure boondoggles that cost many times what they were projected to cost (a la Boston's Big Dig) while the city streets aren't properly paved. People don't have big problems with a city-run garbage service; they have problems with the garbagemen who get six-figure salaries plus a guaranteed union-protected job for life and a defined-benefit pension plan which they don't contribute a penny to (and likewise for their health plans). People don't have a big problem with paying for schools; they have a big problem with paying more than twice the national average for schools and still ending up with miserable schools (New Jersey). People have a problem when the government issues bonds, invests the money in the stock market for the public employee pension plan, projects a 10% annual return, contractually guarantees it to the employees, and then puts the taxpayers on the hook when the Dow ends up at 11,000 instead of ~25,000 (California). And people have a problem with the attitude that when they don't pay taxes they're basically stealing that money, or that tax cuts are morally equivalent to a handout, and the insinuation that they're terrible people for trying to keep some of their money from the government.\"", "title": "" } ]	fiqa
7e674832405c17acd3a13b663ad9b1b4	How to interpret stock performance charts “vs S&P 500”	[ { "docid": "d59301acd1b942e879c09beefec5df5d", "text": "tl;dr: The CNN Money and Yahoo Finance charts are wildly inaccurate. The TD Ameritrade chart appears to be accurate and shows returns with reinvested dividends. Ignoring buggy data, CNN most likely shows reinvested dividends for quoted securities but not for the S&P 500 index. Yahoo most likely shows all returns without reinvested dividends. Thanks to a tip from Grade Eh Bacon, I was able to determine that TD Ameritrade reports returns with reinvested dividends (as it claims to do). Eyeballing the chart, it appears that S&P 500 grew by ~90% over the five year period the chart covers. Meanwhile, according to this S&P 500 return estimator, the five year return of S&P 500, with reinvested dividends, was 97.1% between July 2012 to July 2017 (vs. 78.4% raw returns). I have no idea what numbers CNN Money is working from, because it claims S&P 500 only grew about 35% over the last five years, which is less than half of the raw return. Ditto for Yahoo, which claims 45% growth. Even stranger still, the CNN chart for VFINX (an S&P 500 index fund) clearly shows the correct market growth (without reinvesting dividends from the S&P 500 index), so whatever problem exists is inconsistent: Yahoo also agrees with itself for VFINX, but comes in a bit low even if your assume no reinvestment of dividends (68% vs. 78% expected); I'm not sure if it's ever right. By way of comparison, TD's chart for VFINX seems to be consistent with its ABALX chart and with reality: As a final sanity check, I pulled historical ^GSPC prices from Yahoo Finance. It closed at $1406.58 on 27 Aug 2012 and $2477.55 on 28 Aug 2017, or 76.1% growth overall. That agrees with TD and the return calculator above, and disagrees with CNN Money (on ABALX). Worse, Yahoo's own charts (both ABALX and VFINX) disagree with Yahoo's own historical data.", "title": "" } ]	[ { "docid": "db43947227c383f6e6a93cc8c27cf938", "text": "\"A minor tangent. One can claim the S&P has a mean return of say 10%, and standard deviation of say 14% or so, but when you run with that, you find that the actual returns aren't such a great fit to the standard bell curve. Market anomalies producing the \"\"100-year flood\"\" far more often than predicted over even a 20 year period. This just means that the model doesn't reflect reality at the tails, even if the +/- 2 standard deviations look pretty. This goes for the Black-Sholes (I almost abbreviated it to initials, then thought better, I actually like the model) as well. The distinction between American and European is small enough that the precision of the model is wider than the difference of these two option styles. I believe if you look at the model and actual pricing, you can determine the volatility of a given stock by using prices around the strike price, but when you then model the well out of money options, you often find the market creating its own valuation.\"", "title": "" }, { "docid": "2f59413ac77aa486091797a12cd9d78e", "text": "Robert Shiller published US Stock Market data from 1871. Ken French also has historical data on his website. Damodaran has a bunch of historical data, here is some historical S&P data.", "title": "" }, { "docid": "fbcdc4709a26a75edae1f33af053105b", "text": "This didn't answer his question. Also, while I agree with you that the Dow is meaningless (and your explanation why). In the investment industry, we don't only focus on the S&P Index.. Many have a specific benchmark they aim to outperform that matches their investment strategy (i.e. Russell Mid Cap Value, Russell 3000, etc.).", "title": "" }, { "docid": "0a4079725f2d6fbf8f1f84c9048db43f", "text": "\"This chart concerns an option contract, not a stock. The method of analysis is to assume that the price of an option contract is normally distributed around some mean which is presumably the current price of the underlying asset. As the date of expiration of the contract gets closer the variation around the mean in the possible end price for the contract will decrease. Undoubtedly the publisher has measured typical deviations from the mean as a function of time until expiration from historical data. Based on this data, the program that computes the probability has the following inputs: (1) the mean (current asset price) (2) the time until expiration (3) the expected standard deviation based on (2) With this information the probability distribution that you see is generated (the green hump). This is a \"\"normal\"\" or Gaussian distribution. For a normal distribution the probability of a particular event is equal to the area under the curve to the right of the value line (in the example above the value chosen is 122.49). This area can be computed with the formula: This formula is called the probability density for x, where x is the value (122.49 in the example above). Tau (T) is the reciprocal of the variance (which can be computed from the standard deviation). Mu (μ) is the mean. The main assumption such a calculation makes is that the price of the asset will not change between now and the time of expiration. Obviously that is not true in most cases because the prices of stocks and bonds constantly fluctuate. A secondary assumption is that the distribution of the option price around the mean will a normal (or Gaussian) distribution. This is obviously a crude assumption and common sense would suggest it is not the most accurate distribution. In fact, various studies have shown that the Burr Distribution is actually a more accurate model for the distribution of option contract prices.\"", "title": "" }, { "docid": "62f08eaa49bccd9597553e00a23f7716", "text": "\"While it's definitely possible (and likely?) that a diversified portfolio generates higher returns than the S&P 500, that's not the main reason why you diversify. Diversification reduces risk. Modern portfolio theory suggests that you should maximize return while reducing risk, instead of blindly chasing the highest returns. Think about it this way--say the average return is 11% for large cap US stocks (the S&P 500), and it's 10% for a diversified portfolio (say, 6-8 asset classes). The large cap only portfolio has a 10% chance of losing 30% in a given year, while the diversified portfolio has a 1% chance of losing 30% in a year. For the vast majority of investors, it's worth the 1% annual gap in expected return to greatly reduce their risk exposure. Of course, I just made those numbers up. Read what finance professors have written for the \"\"data and proof\"\". But modern portfolio theory is believed by a lot of investors and other finance experts. There are a ton of studies (and therefore data) on MPT--including many that contradict it.\"", "title": "" }, { "docid": "8c755610386012c509020b65c42c3891", "text": "\"Yes, there is a very good Return vs Risk graph put out at riskgrades.com. Look at it soon, because it will be unavailable after 6-30-11. The RA (return analysis) graph is what I think you are looking for. The first graph shown is an \"\"Average Return\"\", which I was told was for a 3 year period. Three period returns of 3, 6 and 12 months, are also available. You can specify the ticker symbols of funds or stocks you want a display of. For funds, the return includes price and distributions (total return), but only price movement for stocks - per site webmaster. I've used the graphs for a few years, since Forbes identified it as a \"\"Best of the Web\"\" site. Initially, I found numerous problems with some of the data and was able to work with the webmaster to correct them. Lately though, they have NOT been correcting problems that I bring to their attention. For example, try the symbols MUTHX, EDITX, AWSHX and you'll see that the Risk Grades on the graphs are seriously in error, and compress the graph results and cause overwriting and poor readability. If anyone knows of a similar product, I'd like to know about it. Thanks, George\"", "title": "" }, { "docid": "1417779afe385704661db0ac0cd35bc2", "text": "\"Since these indices only try to follow VIX and don't have the underlying constituents (as the constituents don't really exist in most meaningful senses) they will always deviate from the exact numbers but should follow the general pattern. You're right, however, in stating that the graphs that you have presented are substantially different and look like the indices other than VIX are always decreasing. The problem with this analysis is that the basis of your graphs is different; they all start at different dates... We can fix this by putting them all on the same graph: this shows that the funds did broadly follow VIX over the period (5 years) and this also encompasses a time when some of the funds started. The funds do decline faster than VIX from the beginning of 2012 onward and I had a theory for why so I grabbed a graph for that period. My theory was that, since volatility had fallen massively after the throes of the financial crisis there was less money to be made from betting on (investing in?) volatility and so the assets invested in the funds had fallen making them smaller in comparison to their 2011-2012 basis. Here we see that the funds are again closely following VIX until the beginning of 2016 where they again diverged lower as volatility fell, probably again as a result of withdrawals of capital as VIX returns fell. A tighter graph may show this again as the gap seems to be narrowing as people look to bet on volatility due to recent events. So... if the funds are basically following VIX, why has VIX been falling consistently over this time? Increased certainty in the markets and a return to growth (or at least lower negative growth) in most economies, particularly western economies where the majority of market investment occurs, and a reduction in the risk of European countries defaulting, particularly Portugal, Ireland, Greece, and Spain; the \"\"PIGS\"\" countries has resulted in lower volatility and a return to normal(ish) market conditions. In summary the funds are basically following VIX but their values are based on their underlying capital. This underlying capital has been falling as returns on volatility have been falling resulting in their diverging from VIX whilst broadly following it on the new basis.\"", "title": "" }, { "docid": "afe6a50f6ffa99608a6aa9f1d64bd178", "text": "Could somebody explain to me exactly why the writer doesn't think this is a win for passive investing? Aren't 'this could happen' statements only relevant to active managers so if you already believe that active investing is more successful than passive then of course you'll just fit this situation to 'there is still potential for major loss, the S&P has tanked x many times' because you believe that there are predictable patterns in markets while the passive investor says that isn't true.", "title": "" }, { "docid": "1dc5ad53dbebd7ef9cc8e2a028298b67", "text": "\"You are probably going to hate my answer, but... If there was an easy way to ID stocks like FB that were going to do what FB did, then those stocks wouldn't exist and do that because they would be priced higher at the IPO. The fact is there is always some doubt, no one knows the future, and sometimes value only becomes clear with time. Everyone wants to buy a stock before it rises right? It will only be worth a rise if it makes more profit though, and once it is established as making more profit the price will be already up, because why wouldn't it be? That means to buy a real winner you have to buy before it is completely obvious to everyone that it is going to make more profit in the future, and that means stock prices trade at speculative prices, based on expected future performance, not current or past performance. Now I'm not saying past and future performance has nothing in common, but there is a reason that a thousand financially oriented websites quote a disclaimer like \"\"past performance is not necessarily a guide to future performance\"\". Now maybe this is sort of obvious, but looking at your image, excluding things like market capital that you've not restricted, the PE ratio is based on CURRENT price and PAST earnings, the dividend yield is based on PAST publications of what the dividend will be and CURRENT price, the price to book is based on PAST publication of the company balance sheet and CURRENT price, the EPS is based on PAST earnings and the published number of shares, and the ROI and net profit margin in based on published PAST profits and earnings and costs and number of shares. So it must be understood that every criteria chosen is PAST data that analysts have been looking at for a lot longer than you have with a lot more additional information and experience with it. The only information that is even CURRENT is the price. Thus, my ultimate conclusive point is, you can't based your stock picks on criteria like this because it's based on past information and current stock price, and the current stock price is based on the markets opinion of relative future performance. The only way to make a good stock pick is understand the business, understand its market, and possibly understand world economics as it pertains to that market and business. You can use various criteria as an initial filter to find companies and investigate them, but which criteria you use is entirely your preference. You might invest only in profitable companies (ones that make money and probably pay regular dividends), thus excluding something like an oil exploration company, which will just lose money, and lose it, and lose some more, forever... unless it hits the jackpot, in which case you might suddenly find yourself sitting on a huge profit. It's a question of risk and preference. Regarding your concern for false data. Google defines the Return on investment (TTM) (%) as: Trailing twelve month Income after taxes divided by the average (Total Long-Term Debt + Long-Term Liabilities + Shareholders Equity), expressed as a percentage. If you really think they have it wrong you could contact them, but it's probably correct for whatever past data or last annual financial results it's based on.\"", "title": "" }, { "docid": "bf0c9b4874c0abd6793911216f8c490b", "text": "A one year period of study - Stock A trades at $100, and doesn't increase in value, but has $10 in dividends over the period. Stock B starts at $100, no dividend, and ends at $105. However you account for this, it would be incorrect to ignore stock A's 10% return over the period. To flip to a real example, MoneyChimp shows the S&P return from Jan 1980 to Dec 2012 as +3264% yet, the index only rose from 107.94 to 1426.19 or +1221%. The error expands with greater time and larger dividends involved, a good analysis won't ignore any dividends or splits.", "title": "" }, { "docid": "3623cb3175230cdde8f3cf5abed78175", "text": "\"Following comments to your question here, you posted a separate question about why SPY, SPX, and the options contract don't move perfectly together. That's here Why don't SPY, SPX, and the e-mini s&p 500 track perfectly with each other? I provided an answer to that question and will build on it to answer what I think you're asking on this question. Specifically, I explained what it means that these are \"\"all based on the S&P.\"\" Each is a different entity, and different market forces keep them aligned. I think talking about \"\"technicals\"\" on options contracts is going to be too confusing since they are really a very different beast based on forward pricing models, so, for this question, I'll focus on only SPY and SPX. As in my other answer, it's only through specific market forces (the creation / redemption mechanism that I described in my other answer), that they track at all. There's nothing automatic about this and it has nothing to do with some issuer of SPY actually holding stock in the companies that comprise the SPX index. (That's not to say that the company does or doesn't hold, just that this doesn't drive the prices.) What ever technical signals you're tracking, will reflect all of the market forces at play. For SPX (the index), that means some aggregate behavior of the component companies, computed in a \"\"mathematically pure\"\" way. For SPY (the ETF), that means (a) the behavior of SPX and (b) the behavior of the ETF as it trades on the market, and (c) the action of the authorized participants. These are simply different things. Which one is \"\"right\"\"? That depends on what you want to do. In theory you might be able to do some analysis of technical signals on SPY and SPX and, for example, use that to make money on the way that they fail to track each other. If you figure out how to do that, though, don't post it here. Send it to me directly. :)\"", "title": "" }, { "docid": "ee13d447ca63a0e4424994931d061598", "text": "https://www.hussmanfunds.com/wmc/wmc171009m.png >The following charts will provide a sense of where the U.S. equity market currently stands. The first chart shows our margin-adjusted CAPE, which as noted above has a correlation of about -0.89 with actual subsequent market returns across U.S. market cycles since the 1920’s. https://www.hussmanfunds.com/wmc/wmc171009.htm It will turn, downside potential is historic.", "title": "" }, { "docid": "2ee64c477f71e46524f285924da4742c", "text": "Dow Jones: http://en.wikipedia.org/wiki/Historical_components_of_the_Dow_Jones_Industrial_Average NASDAQ: http://en.wikipedia.org/wiki/NASDAQ-100 (scroll down) S&P Tricky. From what I can find, you need to be in Harvard Business School, a member of CRSP, or have access to Bloomberg's databases. S&P did have the info available years ago, but no longer that I can find.", "title": "" }, { "docid": "356a2e623de8568a36800b87f23611e0", "text": "\"There may well be several such graphs, I expect googling will turn them up; but the definition of risk is actually quite important here. My definition of risk might not be quite the same as yours, so the relative risk factors would be different. For example: in general, stocks are more risky than bonds. But owning common shares in a blue-chip company might well be less risky than owning bonds from a company teetering on the edge of bankruptcy, and no single risk number can really capture that. Another example: while I can put all my money in short-term deposits, and it is pretty \"\"safe\"\", if it grows at 1% so that my investment portfolio cannot fund my retirement, then I have a risk that I will run out of money before I shuffle off this mortal coil. How to capture that \"\"risk\"\" in a single number? So you will need to better define your parameters before you can prepare a visual aid. Good Luck\"", "title": "" }, { "docid": "9542646e4405b37844f1c70025ca6bf5", "text": "S&P 500 are a relatively small portion of the entire American economy. Any number of things could cause them to increase in value at a greater rate than total output. For example, distribution of total spending could shift from the public sector to the private sector if government tax receipts and outlays were decreased. It's also possible the economy is becoming more centralized towards tech and industrial giants, with an increasing market share in the hands of fewer, larger companies.", "title": "" } ]	fiqa
4dd48d08a846257c86539c787869c1f9	What questions should I ask a mortgage broker when refinancing a condo in Wisconsin?	[ { "docid": "233e4af509968b677f3d514250ad9cf6", "text": "Its a huuuuuuuuuuuge topic, and to answer your question in full will require a book, with a small booklet of legal advice attached to it. I'm not going to write it here, but I'll give you some very specific points to start your research with: ARM/Baloon - big NO NO. Don't touch that. Get rid of those you have any way you can, and then never ever do it again. That's the kind of crap that got us into the housing bubble mess to begin with. Especially with the rates as low as now, the only future with ARM/Baloon is that you're going to pay more, way more, than your initial period payments. Rates - the rates now are very low. They were even lower 12-24 months ago, but are still extremely low. Make sure you get a fixed rate loan, in order to lock these rates in for the remainder of the loan. Any ARM loan will have higher rates in the future. So go with FIXED RATE. Period - fixed rate loans are given for periods up to 30 years. The shorter the period, the lower the rate. However, at the level they're now, you're practically getting money for free (the APR is comparable to the inflation) even for 30 yr/fixed loans. PMI - private mortgage insurance - since you don't have much equity, the lender is likely to require you paying PMI. This is a significant amount of money you pay until you have at least 20% equity. It changes from lender to lender, so shop around and compare. Government assistance - that's what the broker was referring to. There were programs allowing people refinance even under-water mortgages. Check what programs are still available in your area. Some banks will not refinance with less than 20% equity, but some government assistance programs may help you get a loan even if you don't have enough equity. Closing fees and points - that's the money out of your pocket. Shop around, these vary wildly. Generally, Credit Unions, being non-profits, are cheaper on this item specifically, while comparable to big banks on everything else.", "title": "" } ]	[ { "docid": "d4800724455146c2e8d4292336105ef8", "text": "There is another factor to consider when refinancing is the remaining term left on your loan. If you have 20 years left, and you re-fi into another 30 year loan that extends the length that you will be paying off the house for another 10 years. You are probably better off going with 20, or even 15. If this is a new loan, that is less of an issue, although if you moving and buying a house in a similar price range it is still something to consider. My goal is to have my house paid off before I retire (hopefully early semi-retirement around 55).", "title": "" }, { "docid": "98d5a0edcdedb758a90682458dec1cb9", "text": "The only way I've seen mezz work for more than one cycle is the hard money model. Stay away from glory assets. Maturities of a year or two max. Have the stomach and wherewithal to foreclose quickly when the borrower defaults. Keep the (C)LTV under 70, where the V is not aspirational. Unitranche is generally better because it simplifies and, therefore, expedites things. All that requires sitting on dry powder while your competitors are busy and then it will cost you relationships in your other funds/divisions when you ramp up. This is why most lenders succumb: they tie their managers' careers to the short term, which, to be fair, is much easier to measure. This also applies the broader mezz market beyond RE.", "title": "" }, { "docid": "63d4ae49051ee9037c47e3161cb81f3a", "text": "I am sorry for your troubles, but impressed with your problem solving skills. Keep going, things will get better. Your best hope is to find a place that does manual underwriting. If they do computer generated stuff, then you will be kicked for sure. If you can show 20% down, and have some savings, and have some history of paying bills, then you might be approved. Here in Florida, RP Funding still does manual underwriting. Another one that is mentioned is Church Hill mortgage. Also you might check with local credit unions. Of course your best bet to be approved is to be open and state upfront the challenges. You have to find someone that has the ability to think, has the ability to see passed the challenges, and has the authority to do so.", "title": "" }, { "docid": "26d1fa0919c5d0cd9e23e44fd94ee05e", "text": "yeah, i get that it's not optional. just sucks that nothing has changed substantially since i closed on the loan 11 months ago (same PMI, same HO, essentially the same property taxes) and now i have to pay more. seems like the closing docs could have taken into account timing of those payments so that i primed the pump with enough from the beginning.", "title": "" }, { "docid": "cd883cb6301d3243b1424967e90752c7", "text": "First, I don't think your parents are ripping you off, but you should get your agreement in writing. The fact that you never own more than 25% doesn't matter. If the condo's value is increasing, you are in fact building equity. Your share of the equity just doesn't increase, but it doesn't decrease either. For example, if the condo is worth $300,000 now, you have $75,000 in equity. Of course if the value is decreasing, so is your equity. If you are paying $500/month in interest (as OP clarified above), and you don't have a written agreement, you are probably unable to claim that payment as mortgage interest if you itemize your deductions on U.S. federal or state tax returns, thus you may be losing out on a legal tax deduction (assuming you earn enough to itemize). They will need to give you each year the proper IRS form for mortgage interest (Form 1098). And, they have to claim the $500/month as interest income on their tax returns. Having a written and signed contract eliminates confusion and potential for heartbreaking misunderstanding the future--and it sounds like you are already experiencing some doubt and confusion now. Your rate seems within market rates for an interest-only loan. Let's say you wanted to buy out your parents' share of the condo right now. Would you pay $115,000 or would you have to get an appraisal to find out what the condo is worth now? If you can't answer that question, you need to get that in writing so that you won't have an argument over it someday. If the condo has appreciated significantly and all you have to pay is the $115,000, then that's a sweet deal for you, because you'd be buying out a much more valuable property for much less than it's worth. If that is the agreement, and the property is appreciating (no guarantee, especially with condos), then you are essentially building equity. If the property is declining in value and you do wish to sell it, then you won't have to pay $115,000; they'll just end up with their 75% share, which will be less than the $115K they invested. Both of you would lose some of your investment, but you would have had all the benefits of living in a nice condo all those years and they wouldn't. They are definitely taking more risk than you are. Second, if you had $40,000 cash saved up, your parents probably raised you with some good financial sense and work ethic, so I'm optimistic they have good intentions for your future. Operate from that frame of mind when you go to ask for a written agreement. Next, read up about Equity Share Agreements. There are many models that will help inform your decisions. But, you should engage a real estate lawyer to help you draw up a fair agreement for both parties. I was in an equity share agreement for my first townhouse. It's a common practice, and it won't cost all that much to get one created. It's worth the money to get it done properly.", "title": "" }, { "docid": "1720c6a10467c642a5fa656780667c25", "text": "\"First, one would 'not' want to be the guarantor as it would likely appear as a debt on their credit. In some cases this can be good, but not always. I'd suggest a homeowners meeting. A reverse auction where you say \"\"Would anyone like to get the condo fee waived for 12 months in return for guaranteeing the loan?\"\" If no hands go up, you have an issue. But if even one hand goes up, you have the guarantor. Then you ask if there are any objections. Anyone who objects is welcome to bid fewer, say 10 months. Ideally, you see a dozen hands go up, and you just count down until one one remains. When I lived in a condo the fee was $250. If I were one of the older residents who planned to stay, I'd do it for one or two month's fees.\"", "title": "" }, { "docid": "942b47628a48cf9290710921e24a9e53", "text": "Sorry, this isn't terribly helpful and I would post this as a comment but I'm new and apparently can't. Some considerations: 7% seems awfully high. Check SoFi and see if you can't refinance at a rate low(er) enough rate so that you won't be paying so much interest. How does reinvesting 10k into the company compare to paying off loans? 1.5 years in, you've paid down a lot of interest already... We would need a lot of particulars to give you specific advice, probably more than you're willing to give over the internet. Who does the financials for you business? They should be able to give you advice, or at least build the models specific for your situation to help you make a decision.", "title": "" }, { "docid": "995ef1b1bf6ddd14a9d3fe8709374f0b", "text": "Let's say you owe $200K (since you didn't mention balance. If you do, I'd edit my response), and can get 4.5%. You'd save 1.5% or about $3K/yr the first few years. If a $12K paydown is all that's between you and and refi I'd figure out a way. There are banks that are offering refi's under the HARP program if your current mortgage is owned by FNMA or FMAC which permit even if under water. So, the first step is research to see if you can refi exactly what's owed, failing that, shop around. A 401(k) loan will not appear as a loan on your credit report, that may be one way to raise the $12K. The best thing you can do is put all the savings into the 401(k) to really get it going.", "title": "" }, { "docid": "94b7b27feac8a3dcef63056fa43001dd", "text": "It seems like you are asking two different questions, one is, how do I know if I can afford a house? The other is, how do I know what type of mortage to get? The first question is fairly simple to answer, there's plenty of calculators out there that will tell you what you can afford, but rule of thumb is 30% of income can goto housing. Now what type of mortgage to get can be much more confusing, because the mortgage industry makes money off of these confusing products. The best thing to do in my opionion in situations like this is to keep it simple. You need to be careful buying a house. So much money is changing hands and there are so many parasites involved in the transaction I would be extremely wary of anybody who is going to tell you what mortgage to get. I've never heard of a fee only independent mortgage broker, and if I found one that claimed to be I wouldn't believe him. I would just ignore all the exotic non-conforming products and just answer one simple question. Are you the type of person that buys an insurance policy or that likes to self insure? If you like insurance, get a 30 year fixed mortgage. If you like to self insure, get a 7 year ARM. The average lenghth someone owns a house is 7 years, plus in 7 years time, it might not adjust up, and even if it does, you can just accelerate your payments and pay it off quickly (this is the self insurance part of it). If you're like me, I'm willing to pay an extra .5% for the 30 year so that my payment never changes and I'm never forced to move (which is admitedly extremely unlikely, but I like the safety). I don't like 15 year term loans because rates are so low, you can get way better returns in the stock market right now, so why pay off sooner then you need to. Heck, if I had a paid off house right now I'd refi into a 30 year and invest the money. In summary, pick 30 year or ARM, then just shop around to find the lowest rate (which is extremely easy).", "title": "" }, { "docid": "33862a0dd6492e84350b784e04d5685d", "text": "That's the nice thing. You can read the details and even ask the requester questions just as a loan officer would. You can also filter based on criteria. For me, I filter out wedding expenses, trips, home improvement (not repair), vacations and most major purchases. I tend to invest in refinancing (carefully), business expenses, renewable energy project, and educational expenses. That's the nice thing about it, I can support the initiatives that I choose to support.", "title": "" }, { "docid": "3d389cb4b83d2bff38b4d4220683af49", "text": "If you are not planning on living in your condo for at least 10 years don't do it. For about 5 years your mortgage will be more then rent, after 5 years you start to break even and may start paying less. On the other hand, if you plan to be there for 10 years or more it might be a great savings tool,", "title": "" }, { "docid": "cf5a0b627cb0a5e11a1dadec1b43be54", "text": "I'm of the belief that you should always put 20% down. The lower interest rate will save you thousands over the life of the loan. Also PMI is no different then burning that much cash in the fireplace every month. From Wikipedia Lenders Mortgage Insurance (LMI), also known as Private mortgage insurance (PMI) in the US, is insurance payable to a lender or trustee for a pool of securities that may be required when taking out a mortgage loan. It is insurance to offset losses in the case where a mortgagor is not able to repay the loan and the lender is not able to recover its costs after foreclosure and sale of the mortgaged property. You are basically paying money each month for the bank to be insured against you not paying your mortgage. But in actuality the asset of the condo should be that insurance. Only you can decide if you are comfortable with having $50k in liquidity or not. It sounds like a good cushion to me but I don't know the rest of your expenses.", "title": "" }, { "docid": "9d49fecd9c88546d2b3fd701e7d5f498", "text": "\"Short answer: It depends :) It should generally be cheaper to get a loan directly from a bank, but often a mortgage broker can find you deals that you might not be able to get with a local bank. If you are refinancing, the cheapest option of all is usually to go through the bank that holds your existing mortgage. As for how mortgage brokers make their money, there are two ways. The first is on the \"\"front end\"\" through fees (origination fees especially) that go directly to them. The second and less obvious is on the \"\"back end\"\". This is where they make money by giving you a loan at a slightly higher rate than the lender was willing to give you. So, let's say they find a lender that will give you a loan at 5.25%. They offer that loan to you at 5.5% and pocket the extra .25% when the bank takes it over.\"", "title": "" }, { "docid": "726a20f47f3f5bf128c943ade3684687", "text": "If you can deal with phone calls instead of a face to face meeting, for the average person with an average refinance online tools just offer another way to shop for deals. For new mortgages, I think having a person you can meet face to face will avoid problems, but for just a simple refi, online is one of the places you should check. Compete your current mortgage company, your bank (hopefully credit union), a local broker or two and the online places. The more competition you have, the more power you have in making a good choice.", "title": "" }, { "docid": "2d0225acd76cf1bdfbb716b6bf62df7e", "text": "Does it cost money to refi? I know there are quite a few deals out there, I refi'd in June for $500, not bad. But sometimes can cost couple grand. If so, you have up front costs, plus the cost of the personal loan, that probably would break even at some point after your refi, but at what point? Will you sell before then, or even think about it? Or would you break even next year, then its a no brainer. As mentioned by others, do the numbers.", "title": "" } ]	fiqa
748e33844dfb4ca19eafb5d25644d8cd	My university has tranfered me money by mistake, and wants me to transfer it back	[ { "docid": "b1ffb193f7c184b024bbc3b76b68584a", "text": "If you are convinced/sure its legit. Is doing a bank transfer to correct their mistake, actually the right way to do it in the first place? Best is to write to University and ask if this extra can be adjusted towards future payments. Not sure how much that is and would one or two future payments cover it off. The second best thing would be to ask if University can take it up with Bank and have this reversed? If the above don't work, then request for an address where you can send the check for the refund.", "title": "" }, { "docid": "9b251c3e68002e931dfae96e57c037cd", "text": "Confirming whether the payment was an error The simplest method is to confirm manually with the University whether the payment was a mistake and satisfy that between yourselves. If you're concerned it's fraudulant, I recommend calling the University finance office on a phone number you find on their website, or call one of the people you know. Reversing the payment To formally reverse the payment, I'd check your Product Disclosure Statement on your account with the bank. There's almost always a fee involved where a payment is reversed. It's probably easiest to just issue the payment back to the university to an agreed BSB/Account Number.", "title": "" }, { "docid": "94fa19f0a2309755bbd249404da8c270", "text": "Call in to the bank using a publicly available number to verify the request.", "title": "" }, { "docid": "843e12ea8c8fdca6bece36a8542c7c48", "text": "Really a very straightforward situation, and subsequently, answer. Call the university pursors that you normally deal with, ask them to document the last 3 months of disbursements and highlight the incorrect one(s). If the money is already spent out, ask them if they can apply it to future disbursements via adjusting entries, and call it a day. If not, and you CAN pay it back, go to your bank and ask them to figure it out...which they should be able to do, having the original sender's info.", "title": "" }, { "docid": "97577ed6cc63778664972b55eee31055", "text": "\"You have received some good answers, but since your concern is proper protocol, keep everything in writing (emails, not phone calls). Also, you'll get a quick response by contacting the University \"\"Accounts Payable\"\" department, confirm the situation with a summary as you posted here and ask for the ABA routing number for the transfer. The routing number, email, and you bank statement is all the records you need to cover your but.\"", "title": "" } ]	[ { "docid": "eb83ca5442a18d421fab68113cd1df8b", "text": "\"I doubt there is anything you can do to convince them you paid, outside of just talking to them, which it seems you already tried. These are the possibilities I can think of for how this happened: IMHO, the most likely scenario is #4. If 1 or 3 happened you'll never see your money again, but the other 3 possibilities leave open the option of the error being discovered in the future. My suggestion, if the copay is small, is to pay it again, ask for a receipt, and ask them to make a note in the system that you claim you already paid, and ask them to \"\"be on the look-out\"\" for any discrepancies in that amount. This way, (with a good amount of luck), if they find it or discover the error (from another customer asking about the credit, or an accounting cash surplus), they can refund it to you.\"", "title": "" }, { "docid": "f4896f11a944f6d57641a6383c67637c", "text": "This is not your problem and you should not try to fix it. If your employer paid money into someone else's account instead of yours they should ask their bank to reverse it and should pay you your wages while they are waiting for this to be done. No bank will let you do anything about money paid by someone else into an account that is not yours, or give you details of someone else's account.", "title": "" }, { "docid": "61107244a7aeebff7fdc6c97f2cf385e", "text": "\"This is almost certainly a scam or a mistake. This is not good, spendable money: it is not yours to keep. Very simple to handle. Tell the bank, in writing that you were not expecting to receive this money and are a bit surprised to receive it. Preferably in a way that creates a paper trail. And then stop talking. Why? Because you honestly don't know. This puts you at arm's length to the money: disavowing it, but not refusing it. Wildest dreams: nobody wants it back ever. As for the person bugging you for the cash, tell them nothing except work with their own bank. Then ignore them completely. He probably hacked someone else, diverted their money into your account, and he's conning you into transferring it to a third location: him. Leaving you holding the bag when the reversals hit months later. He doesnt want you reversing; that would return the money to the rightful owner! He works this scam on dozens of people, and he wins if some cooperate. Now here's the hard part. Wait. This is not drama or gossip, you do not need to keep people updated. You are not a bank fraud officer who deals with the latest scams everyday, you don't know what the heck you are doing in this area of practice. (In fact, playing amateur sleuth will make you suspicious). There is nothing for you to do. That urge to \"\"do something\"\" is how scammers work on you. And these things take time. Not everyone banks in real time on smartphone apps. Of course scammers target those who'd be slow to notice; this game is all about velocity. Eventually (months), one of two things is likely to happen. The transfer is found to be fraudulent and the bank reverses it, and they slap you with penalties and/or the cops come knockin'. You refer them to the letter you sent, explaining your surprise at receiving it. That letter is your \"\"get out of jail free\"\" card. The other person works with their bank and claws back the money. One day it just disappears. (not that this is your problem, but they'd file a dispute with their bank, their bank talks to your bank, your bank finds your letter, oh, ok.) If a year goes by and neither of these things happens, you're probably in the clear. Don't get greedy and try to manipulate circumstances so you are more likely to keep the money. Scammers prey on this too. I think the above is your best shot.\"", "title": "" }, { "docid": "dc53d9760e6493e8be78fe83c5079c90", "text": "The company says it's out of their control - it isn't. All they have to do is to INSTRUCT HSBC to send a certain amount of GBP, and then HSBC MUST send GBP. Obviously the bank doesn't like that because they make money through the conversion. That's not your problem. When told to send GBP, they must send GBP. Depending on what your relationship with that company is, you lost money because they didn't send the GBP. At the very least, they sent you four percent less in Euros than they should have sent you. So send them a bill for the difference. It's unfortunate that your bank charged for the conversion Euro to GBP, but fact is that less than the agreed amount arrived at your bank, and that's the responsibility of the sender.", "title": "" }, { "docid": "2c8994eda8bc5560355d5e4bd03d5914", "text": "\"The whole concept of \"\"spending a fraudulent check\"\" is misleading. Both in practice and legally there are two separate transactions - you (not) receiving funds by depositing a fraudulent check, and you sending a cash transfer further on. Regarding the fraudulent check, generally your bank is 'responsible' in the sense that it's their responsibility to recover the money from you - it will not receive any money from the bank that supposedly issued the fake check, and if they give it to you, you spend all that money and are unable to pay it back, that's their problem and not of the other institutions. Regarding the cash transfer, from the bank point of view it's solely your responsibility - it was really you who made that payment, you explicitly authorised/instructed the banks to deliver money to the recipient, and none of those banks have the duty to return it. You have been defrauded by the recipient of this payment, and may attempt to recover the money from the fraudster - but that's not particularly likely to happen even in the case of a successful arrest and conviction. Very fast reaction with involvement of police may block the \"\"vendor's\"\" account before they are able to withdraw the money. If that is the case, you might be able to recover your money or part of it.\"", "title": "" }, { "docid": "aaa7691ca4e8a234d85989b338da4378", "text": "\"It can be a money laundering scheme. The stranger gives you cash for free at first, then proposes to give you more but this time asks you to \"\"spend\"\" a fraction of it (like 80%). So on his side the money comes from a legitimate source. So you do it because after all you get to keep the rest of it and it is \"\"free\"\" money. But you are now involved in something illegal. Having money for which you cannot tell the origin is also something highly suspicious. You will not pay tax on it, and the fiscal administration of your country might give you a fine. Customs might also be able to confiscate the money if they suspect it comes from an illegal source.\"", "title": "" }, { "docid": "b4a9f359372c7bca8b88b5456e089885", "text": "Let's define better the situation and then analyze it: Start with: End with: Process: So B has the same amount of money, just in a different bank account, but A and C changed states. A now doesn't have money, and C does, as the result of the transaction between A, B and C. The gift tax issue I see is the transfer of money from A (you) to C (your brother). If you're a US tax resident then you have $14K exemption from gift tax per person per year. £20K is more than that, so it will be subject to the tax. The fact that a third person was involved as an intermediary is irrelevant - for the purpose of gift tax there's no distinction between using a bank for transfers or a private party. Keep in mind that paying tuition directly to the institution on behalf of your brother may help you mitigate your gift tax liability - tuition payment made on behalf of your brother is exempt from gift tax. But it has to be made directly to the institution, it cannot pass through your brother.", "title": "" }, { "docid": "c11c09b85c443880b8d617752cb05e2a", "text": "\"For some reason can't transfer it directly to his account overseas (something to do with security codes, authorized payees and expired cards). Don't become someone's financial intermediary. Find out exactly why he can't transfer the money himself, and then if you want to help him, solve that problem for him. Helping him fix his issue with his expired card, or whatever the real problem is, would be a good thing to do. Allowing him to involve you in the transaction, would be a bad thing to do. Possible problems which might be caused by becoming directly involved in the transaction: -The relative is being scammed themselves, and doesn't realize it / doesn't realize the risks, and either wants you to take the risk, or simply thinks there is no risk but needs administrative help. -The person contacting you is not the relative - perhaps they are faking that person's identity, and are using your trust to defraud you. -The person is committing some form of fraud, money laundering, or worse, and is directly trying to defraud you in order to keep their hands clean. -The transaction may be perfectly legal, but is considered taxable in one or more countries. By getting involved, you might face tax filing obligations, or even tax payment obligations. -The transaction may be perfectly legal and legitimate, but might accidentally get picked up as potential fraud by a financial monitoring system, causing the funds to be held, and your account to be flagged for further investigation, creating headaches for you until it becomes resolved. There are possibly other ways that this can go awry, but these are the biggest possibilities I can think of. The only possible 'good' outcome here is that everything goes smoothly, and it works exactly as well as if your relative's \"\"administrative problems\"\" were solved first, and the money went through his own account. Handwaving about why your account is needed and his is faulty is a big red flag. If it is truly just an administrative issue on his end, help him fix that issue instead.\"", "title": "" }, { "docid": "fbd6c2dfd00266e39e2432389d038f40", "text": "The money NEVER becomes your money. It has been paid to you in error. Your best response is to write to the company who has paid you in error and tell them that for the responsibilty and subsequent stress caused to you by them putting you in a position of looking after their money you hereby give notice that you are charging them $50 per week until such time as they request the repayment of their money. Keep a dated copy of your letter and if they fail to respond then in 12 weeks they will have to pay you $600 to retrieve their $600. If they come back to you anytime after that they will OWE YOU money - but I wouldn't push for payment on that one. I have successfully used this approach with companies who send unsolicited goods and expect me to mess about returning them if I don't want them. I tell them the weekly fee I am charging them for storage and they quickly make arrangements to either take their goods back or (in one case) told me to keep them.", "title": "" }, { "docid": "5be2abf7ea57d91c0d4d15e22705ea53", "text": "\"Not sure about specific French laws. Assuming its not a political party receiving such donations, and it an normal individual ... General common sense answer would be; but it could very well be a generous donation from someone in the Caimans or Germany The onus would be on you to prove it is a generous donation. What is the threshold between \"\"this money looks like money-laundering\"\" and \"\"this money looks like a generous donation\"\"? There is no threshold. By default if you don't know the source; it is money-laundering. In particular: is it up to me to explain where the money comes from, or is it the sender's problem? You have to explain the source of money. That the Bank in Germany may have to do its own due-diligence is separate from your having to explain the source of funds.\"", "title": "" }, { "docid": "59fa921526d2d5c6f4351b4d548d91fa", "text": "\"Why would you ask \"\"is the money yours\"\", when you know it isn't? When we were young children we were told \"\"two wrongs don't make a right\"\". As an adult we know that breaking the law \"\"to get back at\"\" someone we perceive as breaking the law is illegal. In sports and in real life, the retaliator often receives a worse punishment than the initial rule violator. In the case mentioned, the second part of the \"\"scam\"\" would proceed if you participated or not. The person would go to their bank and indicate a mistaken deposit and have such refunded to their account. By the correct amount yours would be debited. Woe to the person that spent this money prior to the debit.\"", "title": "" }, { "docid": "ab9f280a4c83f71970a17ce68cebc63f", "text": "\"This is a very trivial scam. Flow is like this: Send money to Mr. X (you, in this case). Call Mr. X and ask for the money back, because mistake. Usually they ask for a wire transfer/cash/gift cards/prepaid cards or something else irreversible/untraceable. Mr. X initiates transfer back to Scammer. Accept the transfer from Mr. X Dispute the original transfer or otherwise cancel it through the netbank Mr. X cannot dispute his transfer to the Scammer, since it was genuinely and intentionally initiated by Mr. X. End up with twice the money, at the expense of Mr. X In other countries this is usually done with forged checks, but transfers can work just as well. As long as the transfer can be retroactively canceled or reversed - the scam works. You mentioned money laundering - this is definitely a possibility as well. They transfer dirty money to you from unidentified sources, and you send a \"\"gift\"\" to them with a clear paper trail. When the audit comes - the only proof is that you actually sent them the gift, and no-one will believe your story. You'll have to explain why the Mr. Z who's now in jail sent you a $1K of his drug money. However, in this case I think it is more likely a scam, and the scammer didn't really know what he was doing...\"", "title": "" }, { "docid": "b2ea0cf0c472d2cb95c2b6b9cdac798e", "text": "\"They are right to ask for the money back because you were not entitled to that money. However, you may have a defense called \"\"laches\"\". Basically, you can try to show that because of the government's unreasonable delay in asking for the money back, in the meantime you relied on the assumption that it was your money in good faith, and spent it, and now to have to come up with the money that you assumed you wouldn't need would cause great harm to you.\"", "title": "" }, { "docid": "add38ca7424072cd6aa0226650874a23", "text": "\"I had about $16k in student loans. I defaulted on the loans, and they got > passed to a collection type agency (OSCEOLA). These guys are as legitimate as a collection agency can be. One thing that I feel is very sketchy is when they were verifying my identity they said \"\"Does your Social Security Number end in ####. Is your Birthday Month/Day/Year.\"\" That is not sketchy. It would be sketchy for a caller to ask you to give that information; that's a common scheme for identity theft. OSCEOLA are following the rules on this one. My mom suggested I should consider applying for bankruptcy Won't help. Student loans can't be discharged in bankruptcy. You have the bankruptcy \"\"reform\"\" act passed during the Bush 43 regime for that. The loan itself is from school. What school? Contact them and ask for help. They may have washed their hands of your case when they turned over your file to OSCEOLA. Then again, they may not. It's worth finding out. Also, name and shame the school. Future applicants should be warned that they will do this. What can I do to aid in my negotiations with this company? Don't negotiate on the phone. You've discovered that they won't honor such negotiations. Ask for written communications sent by postal mail. Keep copies of everything, including both sides of the canceled checks you use to make payments (during the six months and in the future). Keep making the payments you agreed to in the conversation six months ago. Do not, EVER, ignore a letter from them. Do not, EVER, skip going to court if they send you a summons to appear. They count on people doing this. They can get a default judgement if you don't show up. Then you're well and truly screwed. What do you want? You want the $4K fee removed. If you want something else, figure out what it is. Here's what to do: Write them a polite letter explaining what you said here. Recount the conversation you had with their telephone agent where they said they would remove the $4K fee if you made payments. Recount the later conversation. If possible give the dates of both conversations and the names of the both agents. Explain the situation completely. Don't assume the recipient of your letter knows anything about your case. Include evidence that you made payments as agreed during the six months. If you were late or something, don't withhold that. Ask them to remove the extra $4K from your account, and ask for whatever else you want. Send the letter to them with a return receipt requested, or even registered mail. That will prevent them from claiming they didn't get it. And it will show them you're serious. Write a cover letter admitting your default, saying you relied on their negotiation to set things straight, and saying you're dismayed they aren't sticking to their word. The cover letter should ask for help sorting this out. Send copies of the letter with the cover letter to: Be sure to mark your letter to OSCEOLA \"\"cc\"\" all these folks, so they know you are asking for help. It can't hurt to call your congressional representative's office and ask to whom you should send the letter, and then address it by name. This is called Constituent Service, and they take pride in it. If you send this letter with copies you're letting them know you intend to fight. The collection agency may decide it's not worth the fight to get the $4K and decide to let it go. Again, if they call to pressure you, say you'd rather communicate in writing, and that they are not to call you by telephone. Then hang up. Should I hire a lawyer? Yes, but only if you get a court summons or if you don't get anywhere with this. You can give the lawyer all this paperwork I've suggested here, and it will help her come up to speed on your case. This is the kind of stuff the lawyer would do for you at well over $100 per hour. Is bankruptcy really an option Certainly not, unfortunately. Never forget that student lenders and their collection agencies are dangerous and clever predators. You are their lawful prey. They look at you, lick their chops, and think, \"\"food.\"\" Watch John Oliver's takedown of that industry. https://www.youtube.com/watch?v=hxUAntt1z2c Good luck and stay safe.\"", "title": "" }, { "docid": "4ed3295e2613a7d343071319647b5e9d", "text": "You were the subject of a typical scam - you cashed a check that was drawn on a stolen account, and then you forwarded the money to a second account or via other means (Western Union etc). The owner of the stolen account informed their bank and the check was reversed, returning the original money from your account, leaving you completely out of pocket. If you forwarded the money by bank transfer or check, contact your bank and report the fraud. If you forwarded the money via another means, such as Western Union, then these methods are usually non-reversible and you will remain out of pocket. You will not be able to get the money back from the stolen account, that was their bank reversing a fraudulent check, they wont do anything to help you. Talk to your bank. Talk to the police.", "title": "" } ]	fiqa
b0c021b551f0e5b3cc31690d12184ef5	Efficient International money transfer	[ { "docid": "4dbccce9bfdb3d5448498fda524912d6", "text": "Typical wire transfers are not with 4-5%; but it all depends on the bank that does the transfer. You can chose to send ('wire') the money in source currency or in US $; the former, the target bank in the US does the conversion (so pick one that adds no or little spread); the latter, the sending bank does the conversion (so ask about their fees/spreads). I have multiple times transferred money across the ocean (though not from Japan), and never paid more than 0.3% + ~40 $ flat. It should be possible to get te same range. Note that if you look around for current offers, you might be easily able to even make some money on it - some US banks are eager for new money, and offer 200+$ bonus if you open an account and bring (significant =15k$+) new money to them.", "title": "" }, { "docid": "c393b2a11daf7865f68881dbb8913a11", "text": "Wiring is the best way to move large amounts of money from one country to another. I am sure Japanese banks will allow you to exchange your Japanese Yen into USD and wire it to Canada. I am not sure if they will be able to convert directly from JPY to CND and wire funds in CND. If you can open a USD bank account in Canada, that might make things easier.", "title": "" } ]	[ { "docid": "08921e6ff179ad1d23307d2cf828f157", "text": "\"This is not a problem. SWIFT does not need the Beneficiary Account Currency. The settlement account [or the Instruction amount] is of interest to the Banks. As I understand your agreement with client is they pay you \"\"X\"\" EUR. That is what would be specified on the SWIFT along with your details as beneficiary [Account Number etc]. Once the funds are received by your bank in Turkey, they will get EUR. When they apply these funds to your account in USD, they will convert using the standard rates. Unless you are a large customer and have special instructions [like do not credit if funds are received in NON-USD or give me a special rate or Call me and ask me what I want to do etc]. It typically takes 3-5 days for an international wire depending on the countries and currencies involved. Wait for few more days and then if not received, you have to ask your Client to mention to his Bank that Beneficiary is claiming non-receipt of funds. The Bank that initiated the transfer can track the wire not the your bank which is supposed to receive the funds.\"", "title": "" }, { "docid": "2059fc80a2f76d37f6cc93401c2bd359", "text": "Generally in a SWIFT transaction, there are 4 Banks involved [at times 2 or 3 or at times even 6]. The 4 Banks are Sender [Originator of Payment]; Sender's correspondent, Receiver's Correspondent, Receiver [Or beneficiary Bank] All these 4 Banks charge for making a transfer. In SHA; the charges of Sender and Senders correspondent are levied to Customer [who initiates the payment] and the Receivers Correspondent and Receiver charges are to beneficiary. In OUR all the charges of 4 Banks are to the Customer and in BEN all the charges of 4 Banks are to the Beneficiary. Or am I wrong to assume that transaction costs would be covered by that 15USD and in reality the 15USD are on top of transaction costs? As explained above it is incorrect assumption. In this case, the charges will be more. So best is go with SHA. This gives a better view of charges. On a EUR to USD transactions, there would typically be only 3 Banks in the chain. And depending on the Bank, it could also be just 2 Banks involved.", "title": "" }, { "docid": "ff8c228fa00407ba410e26d425901054", "text": "\"For the purposes of report generation, I would recommend that you present the data in the currency of the user's home country. You could present another indicator, if needed, to indicate that a specific transaction was denominated in a foreign currency, where the amount represents the value of the foreign-denominated transaction in the user's home country Currency. For example: Airfare from USA to London: $1,000.00 Taxi from airport to hotel: $100.00 (in £) In terms of your database design, I would recommend not storing the data in any one denomination or reference currency. This would require you to do many more conversions between currencies that is likely to be necessary, and will create additional complexity where in some cases, you will need to do multiple conversions per transaction in and out of your reference currency. I think it will be easier for you to store multiple currencies as themselves, and not in a separate reference currency. I would recommend storing several pieces of information separately for each transaction: This way, you can create a calculated Amount for each transaction that is not in the user's \"\"home\"\" currency, whereas you would need to calculate this for all transactions if you used a universal reference currency. You could also get data from an external source if the user has forgotten the conversion rate. Remember that there are always fees and variations in the exchange rate that a user will get for their home country's currency, even if they change money at the same place at two different times on the same day. As a result, I would recommend building in a simple form that allows a user to enter how much they exchanged and how much they got back to calculate the exchange rate. So for example, let's say I have $ 200.00 USD and I exchanged $ 100.00 USD for £ 60.00, and there was a £ 3.00 fee for the exchange. The exchange rate would be 0.6, and when the user enters a currency conversion, your site could create three separate transactions such as: USD Converted to £: $100.00 £ Received from Exchange: £ 60.00 Exchange Fee: £ 3.00 So if the user exchanged currency and then ran a balance report by Currency, you could either show them that they now have $ 100.00 USD and £ 57.00, or you could alternatively choose to show the £ 57.00 that they have as $95.00 USD instead. If you were showing them a transaction report, you could also show the fee denominated in dollars as well. I would recommend storing your balances and transactions in their own currencies, as you will run into some very interesting problems otherwise. For example, let's say you used a reference currency tied to the dollar. So one day I exchange $ 100.00 USD for £ 60.00. In this system I would still have 100 of my reference currency. However, if the next day, the exchange rate falls and $ 1.00 USD is only worth £ 0.55, and I change my £ 60.00 back into USD, I will get approxiamately $ 109.09 USD back for my £ 60.00. If I then go and buy something for $ 100.00 USD, the balance of the reference currency would be at 0, but I will still have $ 9.09 USD in my pocket as a result of the fluctuating currency values! That is why I'd recommend storing currencies as themselves, and only showing them in another currency for convenience using calculations done \"\"on the fly\"\" at report runtime. Best of luck with your site!\"", "title": "" }, { "docid": "5587d59254ae75427a684740897fd2d4", "text": "Depending what country you are from, there may be better alternatives to transfer money internationally. Opening a bank account is complicated, costs money, and international bank transfers are remarkably expensive.", "title": "" }, { "docid": "116c17b0185831018526406ebd813464", "text": "The right answer to this question really depends on the size of the transfer. For larger transfers ($10k and up) the exchange rate is the dominant factor, and you will get the best rates from Interactive Brokers (IB) as noted by Paul above, or OANDA (listed by user6714). Under $10k, CurrencyFair is probably your best bet; while the rates are not quite as good as IB or OANDA, they are much better than the banks, and the transaction fees are less. If you don't need to exchange the currency immediately, you can put in your own bids and potentially get better rates from other CurrencyFair users. Below $1000, XE Trade (also listed by user6714) has exchange rates that are almost as good, but also offers EFT transfers in and out, which will save you wire transfer fees from your bank to send or receive money to/from your currency broker. The bank wire transfer fees in the US can be $10-$30 (outgoing wires on the higher end) so for smaller transfers this is a significant consideration you need to look into; if you are receiving money in US, ING Direct and many brokerage accounts don't charge for incoming wires - but unless you have a commercial bank account with high balances, expect to spend $10-$20 minimum for outgoing. European wire transfer fees are minimal or zero in most cases, making CurrencyFair more appealing if the money stays in Europe. Below $100, it's rarely worth the effort to use any of the above services; use PayPal or MoneyBookers, whatever is easiest. Update: As of December 2013, CurrencyFair is temporarily suspending operations for US residents: Following our initial assessment of regulatory changes in the United States, including changes arising from the Dodd-Frank Act, CurrencyFair will temporarily withdraw services for US residents while we consider these requirements and how they impact our business model. This was a difficult and very regretful decision but we are confident we will be able to resume services in the future. The exact date of re-activation has not yet been determined and may take some time. We appreciate your patience and will continue communicating our status and expected return.", "title": "" }, { "docid": "9e7ade037d44f4b9595d38d7ea099389", "text": "The website http://currencyfair.com/ provides a service which gives you both a decent exchange rate (about 1% off from mid-market rate) and a moderately low fee for the transfer: 4 USD for outgoing ACH in the US, 10 USD for same-day US wire. For the reverse (sending money from the US to EU) the fees are: 3 EUR for an ACH, 8 EUR for a same-day EUR wire. It has been online for quite a while, so I assume its legit, but I'd do a transfer for a smaller sum first, to see if there are any problems, and then a second transfer for the whole sum.", "title": "" }, { "docid": "8e0683a8583aa27b8e29bce069b34820", "text": "It is not ! Of course you can transfer your monies to your account in another country. Its a different story if you were doing it for someone else and if the the money was not legitimate - then it would shade off into money laundering.", "title": "" }, { "docid": "311332c16f52022baed996f2c7cdfc26", "text": "You could use paypal to transfer money. You can pay with paypal and your UK contact could transfer the money to his bank account through paypal. I just received money this way from the US and paid 9 EUR for this. Receiving the funds is as quickly as clicking a button on the paypal site. Transfering it (without costs) took 1-3 days). It is by far the easiest way. If you are uncomfortable using paypal, the other option would be through your own bank account, where you would transfer using IBAN/SWIFT. The SWIFT bank account is usually the IBAN code plus a branch code. Often it is difficult to find the branch code, in that case you can use the IBAN+XXX. In the latter things might be delayed, but I actually haven't noticed the delay yet, since international transfer always seem to take between 1 and 10 days. The international transfering of money costs, except if it is within the EU region. The way to transfer money through Internet banking differs, from bank to bank. They keywords you need to look for are: SEPA, SWIFT, IBAN or international transfer.", "title": "" }, { "docid": "eb9a03241f0728bbb281cd981a8ef674", "text": "Depending on how tech savvy your client is you could potentially use bitcoin. There is some take of indian regulators stopping bitcoin exchanges, meaning it might be hard to get your money out in your local country but the lack of fees to transfer and not getting killed on the exchange rate every time has a huge impact, especially if your individual transaction sizes are not huge.", "title": "" }, { "docid": "9fea2316fbdf92a6a9f2072df1000cf8", "text": "\"I am not sure about transferwise and how they work, but generally when I had to transfer money across countries, I ended up using a foreign currency/transfer company who needed the destination account details i.e. a GBP account in the UK in your case, and money from the source account. Basically that means your father would need to open an EUR account, probably in an EU country (is this an option?) but may be in the UK is fine too depending on transfer fees. And a GBP account in the UK, perhaps see if there is a better business account than HSBC around, I have used them as well as Santander before. The only FX transaction done in this straightforward set up is the one performed by the specialised company (there are a few) - and their spread (difference between interbank i.e. \"\"official\"\" and your price) is likely to be around 1.0 - 1.5%. The other expenses are transfer fees to the FX company account, say a flat fee of $25 for the SWIFT payment. The full amount less the spread above then goes to your UK GBP account. There are still the running costs of both EUR and GBP accounts of course, but here the advice would be just to shop around for offers/free banking periods etc. Point being, given the saving in FX conversion, it might still be a better overall deal than just letting HSBC deal with it all.\"", "title": "" }, { "docid": "658753afb2ce69e32d23b16aa02a4b7e", "text": "If I understand TransferWise’s Supported Countries page correctly, you could use their service. I believe it should be cheaper than having the bank convert. I've been very happy with the service and use it regularly.", "title": "" }, { "docid": "bb7552c1ff46cd7722042c55aa395f87", "text": "RoyalBank provides a no fee transfer service (no fee in the sense that there is no per transfer fee aside from the spread). There is monthly fee if you keep less than 1500 or so on the american side. http://www.rbcroyalbank.com/usbanking/cross-border-transfer.html", "title": "" }, { "docid": "bd6817e4cdc5230ba683aa08909bea15", "text": "I would certainly hope to make the transfer by wire - the prospect of popping cross the border with several million dollars in the trunk seems... ill fated. I suppose I'm asking what sort of taxes, duties, fees, limits, &c. would apply Taxes - None. It is your money, and you can transfer it as you wish. You pay taxes on the income, not on the fact of having money. Reporting - yes, there's going to be reporting. You'll report the origin of the money, and whether all the applicable taxes have been paid. This is for the government to avoid money laundering. But you're going to pay all the taxes, so for transfer - you'll just need to report (and maybe, for such an amount, actually show the tax returns to the bank). Fees - shop around. Fees differ, like any other product/service costs on the marketplace.", "title": "" }, { "docid": "3a3ace553b8d5770299f9fc3f60b1b86", "text": "I've done this for many years, and my method has always been to get a bank draft from my Canadian bank and mail it to my UK bank. The bank draft costs $7.50 flat fee and the mail a couple of dollars more. That's obviously quite a lot to pay on $100, so I do this only every six months or so and make the regular payments out of my UK account. It ends up being only a couple of percent in transaction costs, and the exchange rate is the bank rate.", "title": "" }, { "docid": "5eef390d48857296621a5fd38aab8005", "text": "Several possibilities come to mind: Several online currency-exchange brokers (such as xe.com and HiFx) offer very good exchange rates and no wire transfer fees (beyond what your own bank might charge you). Get French and American accounts at banks that are part of the Global ATM alliance: BNP Paribas in France and Bank of America in the USA. This will eliminate the ATM fee. Get an account at a bank that has branches in both countries. I've used HSBC for this purpose.", "title": "" } ]	fiqa
02d9e8acb2820b38b294ca4fc6cf71ac	What are some sources of information on dividend schedules and amounts?	[ { "docid": "6efc06d196afec374bb60ee6e801f6e6", "text": "I second the Yahoo! Finance key stats suggestion, but I like Morningstar even better: http://quote.morningstar.com/stock/s.aspx?t=roic They show projected yield, based on the most recent dividend; the declared and ex-dividend dates, and the declared amount; and a table of the last handful of dividend payments. Back to Yahoo, if you want to see the whole dividend history, select Historical Prices, and from there, select Dividends Only. http://finance.yahoo.com/q/hp?s=ROIC&a=10&b=3&c=2009&d=00&e=4&f=2012&g=v", "title": "" }, { "docid": "28fd1acdbc2eb2164ba1402e0d88a13a", "text": "There are dividend newsletters that aggregate dividend information for interested investors. Other than specialized publications, the best sources for info are, in my opinion:", "title": "" }, { "docid": "16b63e18f2e95db3e1bdd38ff0c20108", "text": "You can use Yahoo! Finance to pull this information in my use. It is listed under Key Statistics -> Dividends & Splits. For example here is Exxon Mobile (XOM): Dividend Payout Information", "title": "" }, { "docid": "f546a579450b87a61ba2b7d0f2569303", "text": "\"I have 3 favorite sites that I use. http://www.nasdaq.com/symbol/mcd/dividend-history - lists the entire history of dividends and what dates they were paid so you can predict when future dividends will be paid. http://www.dividend.com/dividend-stocks/services/restaurants/mcd-mcdonalds/ - this site lists key stats like dividend yield, and number of years dividend has increased. If the next dividend is announced, it shows the number of days until the ex-dividend date, the next ex-div and payment date and amount. If you just want to research good dividend stocks to get into, I would highly recommend the site seekingalpha.com. Spend some time reading the articles on that site under the dividends section. Make sure you read the comments on each article to make sure the author is not way off base. Finally, my favorite tool for researching good dividend stocks is the CCC Lists produced by Seeking Alpha's David Fish. It is a giant spreadsheet of stocks that have been increasing dividends every year for 5+, 10+, or 25+ years. The link to that spreadsheet is here: http://dripinvesting.org/tools/tools.asp under \"\"U.S. Dividend Champions\"\".\"", "title": "" }, { "docid": "d65e2d5329fa3d2f3b1c4b2a853847b7", "text": "\"Yahoo Finance is definitely a good one, and its ultimately the source of the data that a lot of other places use (like the iOS Stocks app), because of their famous API. Another good dividend website is Dividata.com. It's a fairly simple website, free to use, which provides tons of dividend-specific info, including the highest-yield stocks, the upcoming ex-div dates, and the highest-rated stocks based on their 3-metric rating system. It's a great place to find new stocks to investigate, although you obviously don't want to stop there. It also shows dividend payment histories and \"\"years paying,\"\" so you can quickly get an idea of which stocks are long-established and which may just be flashes in the pan. For example: Lastly, I've got a couple of iOS apps that really help me with dividend investing: Compounder is a single-stock compound interest calculator, which automatically looks up a stock's info and calculates a simulated return for a given number of years, and Dividender allows you to input your entire portfolio and then calculates its growth over time as a whole. The former is great for researching potential stocks, running scenarios, and deciding how much to invest, while the latter is great for tracking your portfolio and making plans regarding your investments overall.\"", "title": "" } ]	[ { "docid": "16b0f346130714809d8295fe35c92f4d", "text": "\"Dividend-paying securities generally have predictable cash flows. A telecom, electric or gas utility is a great example. They collect a fairly predictable amount of money and sells goods at a fairly predictable or even regulated markup. It is easy for these companies to pay a consistent dividend since the business is \"\"sticky\"\" and insulated by cyclical factors. More cyclic investments like the Dow Jones Industrial Average, Gold, etc are more exposed to the crests and troughs of the economy. They swing with the economy, although not always on the same cycle. The DJIA is a basket of 30 large industrial stocks. Gold is a commodity that spikes when people are faced with uncertainty. The \"\"Alpha\"\" and \"\"Beta\"\" of a stock will give you some idea of the general behavior of a stock against the entire market, when the market is trending up and down respectively.\"", "title": "" }, { "docid": "4ed058f7de8d238c01c3ce90f9ae86b7", "text": "\"Someone (I forget who) did a study on classifying total return by the dividend profiles. In descending order by category, the results were as follows: 1) Growing dividends. These tend to be moderate yielders, say 2%-3% a year in today's markets. Because their dividends are starting from a low level, the growth of dividends is much higher than stocks in the next category. 2) \"\"Flat\"\" dividends. These tend to be higher yielders, 5% and up, but growing not at all, like interest on bonds, or very slowly (less than 2%-3% a year). 3) No dividends. A \"\"neutral\"\" posture. 4) Dividend cutters. Just \"\"bad news.\"\"\"", "title": "" }, { "docid": "d80b33775084481e3cce09445f2b3a83", "text": "I don't think that you will be able to find a list of every owner for a given stock. There are probably very few people who would know this. One source would be whoever sends out the shareholder meeting mailers. I suspect that the company itself would know this, the exchange to a lesser extent, and possibly the brokerage houses to a even lesser extent. Consider these resources:", "title": "" }, { "docid": "d424b29f29d724e29c526bee6f6ce5bf", "text": "The yield on Div Data is showing 20% ((3.77/Current Price)*100)) because that only accounts for last years dividend. If you look at the left column, the 52 week dividend yield is the same as google(1.6%). This is calculated taking an average of n number of years. The data is slightly off as one of those sites would have used an extra year.", "title": "" }, { "docid": "add0a2e26607e3e2f5a0795ea12c2485", "text": "I also prefer to crunch the numbers myself. Here are some resources:", "title": "" }, { "docid": "1aa6e57fcc88ff4c8206e366d19db581", "text": "As mentioned, dividends are a way of returning value to shareholders. It is a conduit of profit as companies don't legitimately control upward appreciation in their share prices. If you can't wrap your head around the risk to the reward, then this simply means you partially fit the description for a greater investment risk profile, so you need to put down Warren Buffett's books and Rich Dad Poor Dad and get an investment book that fits your risk profile.", "title": "" }, { "docid": "f2b2cd5d67aa4c7040942dcefbcbc302", "text": "The biggest issue with Yahoo Finance is the recent change to the API in May. The data is good quality, includes both dividend/split adjusted and raw prices, but it's much more difficult to pull the data with packages like R quantmod than before. Google is fine as well, but there are some missing data points and you can't unadjust the prices (or is it that they're all unadjusted and you can't get adjusted? I can't recall). I use Google at home, when I can't pull from Bloomberg directly and when I'm not too concerned with accuracy. Quandl seems quite good but I haven't tried them. There's also a newer website called www.alphavantage.co, I haven't tried them yet either but their data seems to be pretty good quality from what I've heard.", "title": "" }, { "docid": "46651b3b3476d6ee2c361efaaa80b1bb", "text": "It's difficult to compile free information because the large providers are not yet permitted to provide bulk data downloads by their sources. As better advertising revenue arrangements that mimic youtube become more prevalent, this will assuredly change, based upon the trend. The data is available at money.msn.com. Here's an example for ASX:TSE. You can compare that to shares outstanding here. They've been improving the site incrementally over time and have recently added extensive non-US data. Non-US listings weren't available until about 5 years ago. I haven't used their screener for some years because I've built my own custom tools, but I will tell you that with a little PHP knowledge, you can build a custom screener with just a few pages of code; besides, it wouldn't surprise me if their screener has increased in power. It may have the filter you seek already conveniently prepared. Based upon the trend, one day bulk data downloads will be available much like how they are for US equities on finviz.com. To do your part to hasten that wonderful day, I recommend turning off your adblocker on money.msn and clicking on a worthy advertisement. With enough revenue, a data provider may finally be seduced into entering into better arrangements. I'd much rather prefer downloading in bulk unadulterated than maintain a custom screener. money.msn has been my go to site for mult-year financials for more than a decade. They even provide limited 10-year data which also has been expanded slowly over the years.", "title": "" }, { "docid": "0f8ff70696e06a1a1df44938f4de14eb", "text": "If you have access, factset and bloomberg have this. However, these aren't standardized due to non-existent reporting regulations, therefore each company may choose to categorize regions differently. This makes it difficult to work with a large universe, and you'll probably end up doing a large portion manually anyways.", "title": "" }, { "docid": "4f86a8a4bb3fa8d170e7d2cb5f67b104", "text": "Thanks for your thorough reply. Basically, I found a case study in one of my old finance workbooks from school and am trying to complete it. So it's not entirely complicated in the sense of a full LBO or merger model. That being said, the information that they provide is Year 1 EBITDA for TargetCo and BuyerCo and a Pro-Forma EBITDA for the consolidated company @ Year 1 and Year 4 (expected IPO). I was able to get the Pre-Money and Post-Money values and the Liquidation values (year 4 IPO), as well as the number of shares. I can use EBITDA to get EPS (ebitda/share in this case) for both consolidated and stand-alone @ Year 1, but can only get EPS for consolidated for all other years. Given the information provided. One of the questions I have is do I do anything with my liquidation values for an accretion/dilution analysis or is it all EPS?", "title": "" }, { "docid": "04870e2e53ff714d4ec85e6dec4a22ee", "text": "One big difference: Interest is contracted. They can change the rate in the future but for any given time period you know what you're going to get. Dividends are based on how the company did, there is no agreed-upon amount.", "title": "" }, { "docid": "2136538e1c183dd41f933085eadd0b7f", "text": "\"The mathematics site, WolframAlpha, provides such data. Here is a link to historic p/e data for Apple. You can chart other companies simply by typing \"\"p/e code\"\" into the search box. For example, \"\"p/e XOM\"\" will give you historic p/e data for Exxon. A drop-down list box allows you to select a reporting period : 2 years, 5 years, 10 years, all data. Below the chart you can read the minimum, maximum, and average p/e for the reporting period in addition to the dates on which the minimum and maximum were applicable.\"", "title": "" }, { "docid": "ebd7b8b4d4c3a2ee667131466eae36f4", "text": "I second @DumbCoder, every company seems to have its own way of displaying the next dividend date and the actual dividend. I keep track of this information and try my best to make it available for free through my little iphone web app here http://divies.nazabe.com", "title": "" }, { "docid": "34e4ff8c31dc911644bb906c3fa47495", "text": "No - there are additional factors involved. Note that the shares on issue of a company can change for various reasons (such as conversion/redemption of convertible securities, vesting of restricted employee shares, conversion of employee options, employee stock purchase programs, share placements, buybacks, mergers, rights issues etc.) so it is always worthwhile checking SEC announcements for the company if you want an exact figure. There may also be multiple classes of shares and preferred securities that have different levels of dividends present. For PFG, they filed a 10Q on 22 April 2015 and noted they had 294,385,885 shares outstanding of their common stock. They also noted for the three months ended March 31 2014 that dividends were paid to both common stockholders and preferred stockholders and that there were Series A preferred stock (3 million) and Series B preferred stock (10 million), plus a statement: In February 2015, our Board of Directors authorized a share repurchase program of up to $150.0 million of our outstanding common stock. Shares repurchased under these programs are accounted for as treasury stock, carried at cost and reflected as a reduction to stockholders’ equity. Therefore the exact amount of dividend paid out will not be known until the next quarterly report which will state the exact amount of dividend paid out to common and preferred shareholders for the quarter.", "title": "" }, { "docid": "8e99da3dcb69407b14e31d57a876e9de", "text": "\"Yea. Almost every form I fill out wants to know \"\"Employer Name\"\". They don't even bother checking \"\"Are you Self Employed\"\". Of course, I end up writing \"\"Self Employed\"\" in employer name field anyway. In the United States, it is even harder because EVERY state has their own labor and employment laws. You are a freelancer but what if you need to travel to a client site in a different state. Bam, you gotta file taxes for that state as well even if you made like a few hundred bucks. Too much red tape and it is really hard to change.\"", "title": "" } ]	fiqa
5c3139aedde08e386e58849ba5f9c969	If I plan to buy a car in cash, should I let the dealer know?	[ { "docid": "438bad75d87d85c9b5fcb2144e7da298", "text": "Ideally you would negotiate a car price without ever mentioning: And other factors that affect the price. You and the dealer would then negotiate a true price for the car, followed by the application of rebates, followed by negotiating for the loan if there is to be one. In practice this rarely happens. The sales rep asks point blank what rebates you qualify for (by asking get-to-know-you questions like where you work or if you served in the armed forces - you may not realize that these are do-you-qualify-for-a-rebate questions) before you've even chosen a model. They take that into account right from the beginning, along with whether they'll make a profit lending you money, or have to spend something to subsidize your zero percent loan. However unlike your veteran's status, your loan intentions are changeable. So when you get to the end you can ask if the price could be improved by paying cash. Or you could try putting the negotiated price on a credit card, and when they don't like that, ask for a further discount to stop you from using the credit card and paying cash.", "title": "" }, { "docid": "a531ae13f8165cbc32348746da7983e3", "text": "\"Yes you tell them. I can say that I pay cash for all my cars and always get cars for lower than the TrueCar low-end. There are basically two steps: go test drive, negotiate fully, leave (unless you are given a mind-blowing offer). This may take you one to many dealerships. It depends on how well you know what car you want and how much a dealership will negotiate. you pick a night that another dealership that specifically has the car you want (or multiple - even better) is open and you go in 30-45 mins before they close. Paying cash is key for this to work. By the time you get to numbers they will be almost closed. Their finance guy might be gone so you will get your salesman and a manager. I will use my last car as an example. Toyota Highlander 2015 with MSRB 32,995. TrueCar at 29,795 with a good deal at 29,400. I simply talked to my sales guy said I would like to walk out with the car tonight. I have already talked to XYZ dealership and they offered me 28,500 - which is already below TrueCar low price. I asked for $27,900. Boom 10 minutes later car bought at 28,100. Cash is king. The sales guy and manager will bite the bullet on profit for ease of sale. Going in late is the key to using the cash. You don't have the finance guys jumping in and you have less people to move through. Also they know they have limited time to deal and if you walk off the lot there is less than 10% chance of you coming back - they want to close. They are making minimal profit but doing minimal work. With cash your sales guy is on your side because you are basically throwing him a couple hundred dollars at the end of a shift (where most would just be sitting around watching TV). Some other tips: be fair. If they would have said 28,300 is our lowest that we can go and that's it. I probably would have still got the car. Dealerships will tell you their lowest price if you are close and you are still below it. since they didn't show me their lowest price I didn't budge much but still budged a bit to show good sport. They brought their invoice number out to show that at 28,100 that they were going to lose $1500 on the car. I made the manager laugh because my response was to bring up KBB and show the used car price for the car, which was minus $2000. So I just said, \"\"Well you lost $1500 but I lose $2000 driving this off the lot.\"\" I then went back to $27,850 to meet in the middle of \"\"losing\"\" money. This actually closed the deal. Anyway don't ever believe any piece of paper they show you with numbers. These dealerships get monthly bonuses on sales and that is a lot of their profit past selling your trade-in. If you actually value your money you would never be trading in a car to a dealer so if you are paying cash, sell your own car or at least take it to a place like CarMax which I don't endorse but better than dealer.\"", "title": "" }, { "docid": "8a1f39931d478f146422f20709cd9041", "text": "\"Ditto other answers, but I'd add there's a lot of psychology going on in a sale. If you're paying cash, you presumably have a pretty fixed upper limit on what you can spend. But if you're getting a loan, a large increase in the price of the car may sound like just a small addition to the monthly payment. Also, these days dealers often try to roll \"\"extended warranties\"\" into the loan payment. Most people can't calculate loan amortizations in their heads -- I'm pretty good at math, and I need a calculator to work it out, assuming I remember or wrote down the formula -- a dealer can often stick a piece of paper in front of you saying \"\"Loan payment: $X per month\"\" with fine print that says that includes $50 for the extended warranty, and most people would just say, \"\"oh, okay\"\".\"", "title": "" }, { "docid": "fb32ab169c1794b67f1a1ee65fd22d70", "text": "If you buy a car using a loan, the dealer gets benefited by the financing institution by the way of referring fee paid to the dealer by the institution, and that too if the dealer has helped in financing the purchase. Otherwise for the dealer it doesn't matter if one pays in full or through financing. The dealer is paid in full in either cases. Hence the dealer may slightly get disappointed that you are not taking a loan.", "title": "" }, { "docid": "277d4423be680399e5c346d4177ce244", "text": "In the UK at least, dealers definitely want you to take finance. They get benefits from the bank (which are not insubstantial) for doing this; these benefits translate directly to increased commission and internal rewards for the individual salesman. It's conceivable that the salesman will be less inclined to put himself out for you in any way by sweetening your deal as much as you'd like, if he's not going to get incentives out of it. Indeed, since he's taking a hit on his commission from you paying in cash, it's in his best interests to perhaps be firmer with you during price negotiation. So, will the salesman be frustrated with you if you choose to pay in cash? Yes, absolutely, though this may manifest in different ways. In some cases the dealer will offer to pay off the finance for you allowing you to pay directly in cash while the dealer still gets the bank referral reward, so that everyone wins. This is a behind-the-scenes secret in the industry which is not made public for obvious reasons (it's arguably verging on fraud). If the salesman likes you and trusts you then you may be able to get such an arrangement. If this does not seem likely to occur, I would not go out of my way to disclose that I am planning to pay with cash. That being said, you'll usually be asked very early on whether you are seeking to pay cash or credit (the salesman wants to know for the reasons outlined above) and there is little use lying about it when you're shortly going to have to come clean anyway.", "title": "" } ]	[ { "docid": "908bb1c1bfc0b6588872a25b38b982be", "text": "I think you are a little confused. If you have 10.000€ in cash for a car, but you decide instead to invest that money and take out a loan for the car at 2,75% interest, you would have to withdraw/sell 178€ each month from your investment to make your loan payment. If you made exactly 2,75% on your investment, you would be left with 0€ in your investment when the loan was paid off. If your investment did better than 2,75%, you would come out ahead, and if your investment did worse than 2,75%, you would have lost money on your decision. Having said all that, I don't recommend borrowing money to buy a car, especially if you have that amount of cash set aside for the car. Here are some of the reasons: Sometimes people feel better about spending large amounts of money if they can pay it off over time, rather than spending it all at once. They tell themselves that they will come out ahead with their investments, or they will be earning more later, or some other story to make themselves feel better about overspending. If getting the loan is allowing you to spend more money on a car than you would spend if you were paying cash, then you will not come out ahead by investing; you would be better off to spend a smaller amount of money now. I don't know where you are in the world, but where I come from, you cannot get a guaranteed investment that pays 2,75%. So there will be risk involved; if the next year is a bad one for your investment, then your investment losses combined with your withdrawals for your car payments could empty your investment before the car is paid off. Conversely, by skipping the 2,75% loan and paying cash for your car, you have essentially made a guaranteed 2,75% on this money, comparatively speaking. I don't know what the going rate is for car loans where you are, but often car dealers will give you a low loan rate in exchange for a higher sales price. As a result, you might think that you can easily invest and beat the loan rate, but it is a false comparison because you overpaid for the car.", "title": "" }, { "docid": "d1f1aa4fd1d65fa135ec33d4155d334c", "text": "\"You are correct to be wary. Car dealerships make money selling cars, and use many tactics and advertisements to entice you to come into their showroom. \"\"We are in desperate need of [insert your make, model, year and color]! We have several people who want that exact car you have! Come in and sell it to us and buy a new car at a great price! We'll give you so much money on your trade in!\"\" In reality, they play a shell game and have you focus on your monthly payment. By extending the loan to 4 or 5 years (or longer), they can make your monthly payment lower, sure, but the total amount paid is much higher. You're right: it's not in your best interest. Buy a car and drive it into the ground. Being free of car payments is a luxury!\"", "title": "" }, { "docid": "12262c326568149698533a3c185be27c", "text": "If a shop offers 0% interest for purchase, someone is paying for it. e.g., If you buy a $X item at 0% interest for 12 months, you should be able to negotiate a lower cash price for that purchase. If the store is paying 3% to the lender, then techincally, you should be able to bring the price down by at least 2% to 3% if you pay cash upfront. I'm not sure how it works in other countries or other purchases, but I negotiated my car purchase for the dealer's low interest rate deal, and then re-negotiated with my preapproved loan. Saved a good chunk on that final price!", "title": "" }, { "docid": "bcccf69a9f98dfcff83c699440ea1e54", "text": "\"If you were making that large of a payment (via a cashiers check or other withdrawal means from a cash account) to a credit card, would the payment generate a Cash Transaction Report? Probably, yes. If it does require the bank to make a CTR, then is there any harm in that or anything to be concerned about (like that transaction appearing suspicious, personal reporting implications, etc.)? Are there any other reasons why one might want to make sure payments to a credit card are broken up made* in amounts smaller than $10K? You should be concerned if you cannot explain the source of the money (legally...). If you withdrew cash from your own account and paid your credit card with it, in case of questions asked you can show the account statement with the matching withdrawal, and you're done. The point in this report is to point at people who move around large amounts of cash. Usually, people pay credit cards with checks or ACH transactions, but if you want cash - it's your right, as long as the cash was obtained legally. But if you're paying your credit cards off with the cash you got as a bribe or by selling cocaine on the streets, then you should be worried. By the way, breaking into smaller payments may not save you from being reported to the money laundering detection agencies. The report is per transaction, not per payment, so if the credit card statement is $11K and you pay $5K and $6K - the transaction is still $11K. Also, the bank can file a report even if it is not required (it was clarified in the other answer to the same question you're referring to), if the clerk thinks the transaction is suspicious. This leaves the decision on filing a report solely on the banks \"\"common sense\"\" and internal policies which you don't know. So even paying $10 in cash may trigger a report if the bank suspects wrongdoing.\"", "title": "" }, { "docid": "230bf99815c0f1b4b3d8aea5c08f2c0f", "text": "The car dealership doesn't care where you get the cash; they care about it becoming their money immediately and with no risk or complications. Any loan or other arrangements you make to raise the cash is Your Problem, not theirs, unless you arrange the loan through them.", "title": "" }, { "docid": "06b62f2e839c4409e58c08dab7ad9f74", "text": "1) How long have you had the car? Generally, accounts that last more than a year are kept on your credit report for 7 years, while accounts that last less than a year are only kept about 2 years (IIRC - could someone correct me if that last number is wrong?). 2) Who is the financing through? If it's through a used car dealer, there's a good chance they're not even reporting it to the credit bureaus (I had this happen to me; the dealer promised he'd report the loan so it would help my credit, I made my payments on time every time, and... nothing ever showed up. It pissed me off, because another positive account on my credit report would have really helped my score). Banks and brand name dealers are more likely to report the loan. 3) What are your expected long term gains on the stocks you're considering selling, and will you have to pay capital gains on them when you do sell them? The cost of selling those stocks could possibly be higher than the gain from paying off the car, so you'll want to run the numbers for a couple different scenarios (optimistic growth, pessimistic, etc) and see if you come out ahead or not. 4) Are there prepayment penalties or costs associated with paying off the car loan early? Most reputable financiers won't include such terms (or they'll only be in effect during the first few months of the loan), but again it depends on who the loan is through. In short: it depends. I know people hate hearing answers like that, but it's true :) Hopefully though, you'll be able to sit down and look at the specifics of your situation and make an informed decision.", "title": "" }, { "docid": "ab573c1f875dcbc6bc45473c81083849", "text": "\"A while back I sold cars for a living. Over the course of 4 years I worked for 3 different dealerships. I sold new cars at 2 and used at the last one. When selling new cars I found that the majority of people buying the higher end cars honestly shouldn't have been - 80%+. They almost always came in owing more on their trades then they were worth, put down very little cash and were close to being financially strapped. From a financial perspective these deals were hard to close, not because the buyer was picky but rather because their finances were a mess. Fully half, and probably more, we had to switch from the car they initially wanted down to a much cheaper version or try to convert to a lease because it was the only way the bank would loan the money. We called them \"\"$30,000 millionaires\"\" because they didn't make a whole lot but tried to look like they did. As a salesman you knew you were in serious trouble when they didn't even try to negotiate. Around 2% of the deals I did were actual cash deals - meaning honest cash, not those who came in with a pre-approved loan from a bank. These were invariably for used cars about 3 to 4 years old and they never had a trade in. The people doing this always looked comfortable but never dressed up, you wouldn't even look at them twice. The negotiations were hard because they knew exactly how much that car should go for and wouldn't even pay that. It was obvious they knew the value of money. That said, I've been in the top 3% of wage earners for about 20 years and at no point have I considered myself in a position to \"\"afford\"\" a new \"\"luxury\"\" car. IMHO, there are far more important things you can do with that kind of money.\"", "title": "" }, { "docid": "ca02d79a218a5da56b3ad28ddecc2d10", "text": "\"I have a very simple rule. For anything other than trivial purchases (a small fraction of my monthly income), the only final decision I will make in the presence of a salesperson is \"\"No\"\". After I have the terms nailed down, and still feel that I am likely to buy the item, I leave the store, car dealership etc., and think about it by myself. Often, I go to a mall coffee shop to do the thinking. If it is really big, I sleep on it and make my decision the next day. Once I have made my decision, I inform the salesperson. If the decision is \"\"No\"\" I do not discuss my reasons - that gives them an overcome-the-objection lever. I just tell them I have decided not to buy the item, which is all they need to know.\"", "title": "" }, { "docid": "2c91d469adaf30cb4392e92342f5ad50", "text": "\"Unfortunately, it's not unusual enough. If you're looking for a popular car and the dealer wants to make sure they aren't holding onto inventory without a guarantee for sale, then it's a not completely unreasonable request. You'll want to make sure that the deposit is on credit card, not cash or check, so you can dispute if an issue arises. Really though, most dealers don't do this, requiring a deposit, pre sale is usually one of those hardball negotiating tactics where the dealer wrangles you into a deal, even if they don't have a good deal to make. Dealers may tell you that you can't get your deposit back, even if they don't have the car you agreed on or the deal they agreed to. You do have a right for your deposit back if you haven't completed the transaction, but it can be difficult if they don't want to give you your money back. The dealer doesn't ever \"\"not know if they have that specific vehicle in stock\"\". The dealer keeps comprehensive searchable records for every vehicle, it's good for sales and it's required for tax records. Even when they didn't use computers for all this, the entire inventory is a log book or phone call away. In my opinion, I would never exchange anything with the dealer without a car actually attached to the deal. I'd put down a deposit on a car transfer if I were handed a VIN and verified that it had all the exact options that we agreed upon, and even then I'd be very cautious about the condition.\"", "title": "" }, { "docid": "6d5910124726284e0e65d9ed7ffacf81", "text": "\"I love John's answer, but I just can't help myself from adding my 2 cents, even though it's over 5 years later. I sold cars for a while in the late 90s, and I mostly agree with John's answer. Where I disagree though, is that where I worked, the salesperson did not have ANY authority to make a sale. A sales manager was required to sign off on every sale. That doesn't mean that the manager had to interact with the buyer, that could all be handled behind the scenes, but the pricing and even much of the negotiating strategies were dictated by the sales managers. Some of the seasoned salespeople would estimate numbers on their own, but occasionally you'd hear the managers still chew them out with \"\"I wish you wouldn't have said that\"\". Of course, every dealership is different. Additional purchase advice: There is a strategy that can work well for the buyer, but only in scenarios where the salesperson is trying to prevent you from leaving. They may start interrupting you as you are packing up, or blocking your path to the door, or even begging. If this happens, they are obviously desperate for whatever reason. In this case, if you came prepared with research on a good price that you are comfortable with, then shoot lower and hold firm to the point of near exhaustion. Not so low that that they realize you're too far away- they will let you leave at that point. It needs to be within a reasonable amount, perhaps at most 1-2% of the purchase price. Once you detect the salesperson is desperate, you finally move up to your goal number or possibly a little lower. Typically the salesperson will be so happy to have gotten you to move at all that they'll accept. And if the managers are fed up too (like 45 minutes after close), they'll accept too. I saw this happen multiple times in a high pressure scenario. I also used it once myself as a buyer. If you are planning to purchase options that can be added at the dealer rather than from the factory, keep them up your sleeve at first. Get your negotiations down to where you are a little further apart than the invoice price of the option, then make your move. For example, suppose the option you want retails for $350 with an invoice of $300. Get within about $400 of the dealer. Then offer to pay their price, but only if they throw in the option you want. This will throw them completely off guard because they didn't expect it and all of their calculations were based on without it. If they say yes, you effectively moved $100 and they moved $300. It's much more likely that they'll agree to this than taking $300 off the price of the car. (I'm guessing the reason for this is partially due to how their accounting works with sticker price vs aftermarket price, and partially psychological.) Note, this works best with new cars, and make sure you only do this if it's for items they can add after the fact. Even if they don't have the part in stock it's ok, they can give you an IOU. But if the option requires a car change to something they don't have on the lot, it will probably just make them mad.\"", "title": "" }, { "docid": "f66e25bacedbdcc71660c7a8b122bb2e", "text": "The only issue I can see is that the stranger is looking to undervalue their purchase to save money on taxes/registration (if applicable in your state). Buying items with cash such as cars, boats, etc in the used market isn't all that uncommon* - I've done it several times (though not at the 10k mark, more along about half of that). As to the counterfeit issue, there are a couple avenues you can pursue to verify the money is real: *it's the preferred means of payment advocated by some prominent personal financial folks, including Dave Ramsey", "title": "" }, { "docid": "393ee932bbcbbe5f9751ffa34a64af45", "text": "\"It sounds like you're basing your understanding of your options regarding financing (and even if you need a car) on what the car salesman told you. It's important to remember that a car salesman will do anything and say anything to get you to buy a car. Saying something as simple as, \"\"You have a low credit score, but we can still help you.\"\" can encourage someone who does not realize that the car salesman is not a financial advisor to make the purchase. In conclusion,\"", "title": "" }, { "docid": "dc46bad77cc109cfa403d08ea54ba070", "text": "If they bring cash, meet at your bank to verify. If they want to use cashiers check, meet them at their bank. Large amounts use wires directly to your acct and verify (not only received, but deposited) before handing over the title/keys.", "title": "" }, { "docid": "fbe3c32df23d6bab65850a0504a96d0d", "text": "Very generally speaking if you have a loan, in which something is used as collateral, the leader will likely require you to insure that collateral. In your case that would be a car. Yes certainly a lender will require you to insure the vehicle that they finance (Toyota or otherwise). Of course, if you purchase a vehicle for cash (which is advisable anyway), then the insurance option is somewhat yours. Some states may require that a certain amount of coverage is carried on a registered vehicle. However, you may be able to drop the collision, rental car, and other options from your policy saving you some money. So you buy a new car for cash ($25K or so) and store the thing. What happens if the car suffers damage during storage? Are you willing to save a few dollars to have the loss of an asset? You will have to insure the thing in some way and I bet if you buy the proper policy the amount save will be very minimal. Sure you could drop the road side assistance, rental car, and some other options, during your storage time but that probably will not amount to a lot of money.", "title": "" }, { "docid": "168704f710afdf153cf1d910d90c06eb", "text": "\"You can greatly reduce the risk if you can line up a buyer prior to purchasing the car. That kind of thing is common in business, one example is drop shipping. Also there are sales companies that specialize in these kinds of things bringing manufacturers of goods together with customers. The sales companies never take delivery of the product, just a commission on the sales. From this the manufacturers are served as they have gained a customer for their goods. The buying company is served as they can make a \"\"better\"\" end product. The two parties may have not been brought together had it not been for the sales company so on some level both are happy to pay for the service. Can you find market inequalities and profit from them? Sure. I missed a great opportunity recently. I purchased a name brand shirt from a discount store for $20. Those shirts typically sell on ebay for $80. I should have cleaned out that store's inventory, and I bet someone else did as by the time I went back they were gone. That kind of thing was almost risk-less because if the shirts did not sell, I could simply return them for the full purchase price. That and I can afford to buy a few hundred dollars worth of shirts. Can you afford to float 45K CDN? What if it takes a year to sell the car? What if the economy goes sour and you are left \"\"holding the bag\"\"? Why are not car dealers doing exactly what you propose? Here in the US this type of thing is called \"\"horse trading\"\" and is very common. I've both lost and made money on these kind of deals. I would never put a significant amount of my net worth at risk.\"", "title": "" } ]	fiqa
4bda541623260f04b0390db05e7fc2d9	What is the equivalent of the QQQ in the UK for the FTSE 100?	[ { "docid": "1b2dae65dd374866d9f3920425b49b6e", "text": "I'm not familiar with QQQ, but I'm guessing this is something like IShares Ftse 100 (see description here)", "title": "" }, { "docid": "6e1a49099026facd9c7a976bb9804035", "text": "I searched for FTSE 100 fund on Yahoo Finance and found POW FTSE RAF UK 100 (PSRU.L), among many others. Google Finance is another possible source that immediately comes to mind.", "title": "" } ]	[ { "docid": "776a0fad3abfce8445dedec1de473ff6", "text": "Short the Pound and other English financial items. Because the English economy is tied to the EU, it will be hit as well. You might prefer this over Euro denominated investments, since it's not exactly clear who your counterpart is if the Euro really crashes hard. Meaning suppose you have a short position Euro's versus dollars, but the clearing house is taken down by the crash.", "title": "" }, { "docid": "5143955b19fc35d10f4d972ba0c77714", "text": "I've never heard of such a thing, but seems like if such a product existed it would be easily manipulated by the big trading firms - simply bet that trading volume will go up, then furiously buy and sell shares yourself to artificially drive up the volume. The fact that it would be so easily manipulated makes me think that no such product exists, but I could be wrong.", "title": "" }, { "docid": "38209351c883c0ccdec99ec8f3586956", "text": "\"I agree that you should CONSIDER a shares based dividend income SIPP, however unless you've done self executed trading before, enough to understand and be comfortable with it and know what you're getting into, I would strongly suggest that as you are now near retirement, you have to appreciate that as well as the usual risks associated with markets and their constituent stocks and shares going down as well as up, there is an additional risk that you will achieve sub optimal performance because you are new to the game. I took up self executed trading in 2008 (oh yes, what a great time to learn) and whilst I might have chosen a better time to get into it, and despite being quite successful over all, I have to say it's the hardest thing I've ever done! The biggest reason it'll be hard is emotionally, because this pension pot is all the money you've got to live off until you die right? So, even though you may choose safe quality stocks, when the world economy goes wrong it goes wrong, and your pension pot will still plummet, somewhat at least. Unless you \"\"beat the market\"\", something you should not expect to do if you haven't done it before, taking the rather abysmal FTSE100 as a benchmark (all quality stocks, right? LOL) from last Aprils highs to this months lows, and projecting that performance forwards to the end of March, assuming you get reasonable dividends and draw out £1000 per month, your pot could be worth £164K after one year. Where as with normal / stable / long term market performance (i.e. no horrible devaluation of the market) it could be worth £198K! Going forwards from those 2 hypothetical positions, assuming total market stability for the rest of your life and the same reasonable dividend payouts, this one year of devaluation at the start of your pensions life is enough to reduce the time your pension pot can afford to pay out £1000 per month from 36 years to 24 years. Even if every year after that devaluation is an extra 1% higher return it could still only improve to 30 years. Normally of course, any stocks and shares investment is a long term investment and long term the income should be good, but pensions usually diversify into less and less risky investments as they get close to maturity, holding a certain amount of cash and bonds as well, so in my view a SIPP with stocks and shares should be AT MOST just a part of your strategy, and if you can't watch your pension pot payout term shrink from 26 years to 24 years hold your nerve, then maybe a SIPP with stocks and shares should be a smaller part! When you're dependent on your SIPP for income a market crash could cause you to make bad decisions and lose even more income. All that said now, even with all the new taxes and loss of tax deductible costs, etc, I think your property idea might not be a bad one. It's just diversification at the end of the day, and that's rarely a bad thing. I really DON'T think you should consider it to be a magic bullet though, it's not impossible to get a 10% yield from a property, but usually you won't. I assume you've never done buy to let before, so I would encourage you to set up a spread sheet and model it carefully. If you are realistic then you should find that you have to find really REALLY exceptional properties to get that sort of return, and you won't find them all the time. When you do your spread sheet, make sure you take into account all the one off buying costs, build a ledger effectively, so that you can plot all your costs, income and on going balance, and then see what payouts your model can afford over a reasonable number of years (say 10). Take the sum of those payouts and compare them against the sum you put in to find the whole thing. You must include budget for periodic minor and less frequent larger renovations (your tenants WON'T respect your property like you would, I promise you), land lord insurance (don't omit it unless you maintain capability to access a decent reserve (at least 10-20K say, I mean it, it's happened to me, it cost me 10K once to fix up a place after the damage and negligence of a tenant, and it definitely could have been worse) but I don't really recommend you insuring yourself like this, and taking on the inherent risk), budget for plumber and electrician call out, or for appropriate schemes which include boiler maintenance, etc (basically more insurance). Also consider estate agent fees, which will be either finders fees and/or 10% management fees if you don't manage them yourself. If you manage it yourself, fine, but consider the possibility that at some point someone might have to do that for you... either temporarily or permanently. Budget for a couple of months of vacancy every couple of years is probably prudent. Don't forget you have to pay utilities and council tax when its vacant. For leaseholds don't forget ground rent. You can get a better return on investment by taking out a mortgage (because you make money out of the underlying ROI and the mortgage APR) (this is usually the only way you can approach 10% yield) but don't forget to include the cost of mortgage fees, valuation fees, legal fees, etc, every 2 years (or however long)... and repeat your model to make sure it is viable when interest rates go up a few percent.\"", "title": "" }, { "docid": "ea5224b299f0a085053f5da9d760c98c", "text": "\"FTSE ethical investment index: http://www.ftse.com/products/indices/FTSE4Good \"\"The FTSE4Good Index is a series of ethical investment stock market indices launched in 2001 by the FTSE Group. A number of stock market indices are available, for example covering UK shares, US shares, European markets, and Japan, with inclusion based on a range of corporate social responsibility criteria. Research for the indices is supported by the Ethical Investment Research Services (EIRIS).\"\" - Wikipedia\"", "title": "" }, { "docid": "2379e2f1e6f178d08404ad68f7796fef", "text": "http://www.moneysupermarket.com/shares/CompareSharesForm.asp lists many. I found the Interactive Investor website to be excruciatingly bad. I switched to TD Waterhouse and found the website good but the telephone service a bit abrupt. I often use the data presented on SelfTrade but don't have an account there.", "title": "" }, { "docid": "83d7f42c43f58775278ebe1d15dde98b", "text": "FYI, I am assuming you are an individual investor.. The rates on the website may change, if the government decides so. Anyway it is a UK government website, so it would reflect the changes immediately.", "title": "" }, { "docid": "61e08f0d238c2474a7eb648aac96c339", "text": "\"TL;DR - go with something like Barry Ritholtz's All Century Portfolio: 20 percent total U.S stock market 5 percent U.S. REITs 5 percent U.S. small cap value 15 percent Pacific equities 15 percent European equities 10 percent U.S. TIPs 10 percent U.S. high yield corp bonds 20 percent U.S. total bond UK property market are absurdly high and will be crashing a lot very soon The price to rent ratio is certainly very high in the UK. According to this article, it takes 48 years of rent to pay for the same apartment in London. That sounds like a terrible deal to me. I have no idea about where prices will go in the future, but I wouldn't voluntarily buy in that market. I'm hesitant to invest in stocks for the fear of losing everything A stock index fund is a collection of stocks. For example the S&P 500 index fund is a collection of the largest 500 US public companies (Apple, Google, Shell, Ford, etc.). If you buy the S&P 500 index, the 500 largest US companies would have to go bankrupt for you to \"\"lose everything\"\" - there would have to be a zombie apocalypse. He's trying to get me to invest in Gold and Silver (but mostly silver), but I neither know anything about gold or silver, nor know anyone who takes this approach. This is what Jeremy Siegel said about gold in late 2013: \"\"I’m not enthusiastic about gold because I think gold is priced for either hyperinflation or the end of the world.\"\" Barry Ritholtz also speaks much wisdom about gold. In short, don't buy it and stop listening to your friend. Is buying a property now with the intention of selling it in a couple of years for profit (and repeat until I have substantial amount to invest in something big) a bad idea? If the home price does not appreciate, will this approach save you or lose you money? In other words, would it be profitable to substitute your rent payment for a mortgage payment? If not, you will be speculating, not investing. Here's an articles that discusses the difference between speculating and investing. I don't recommend speculating.\"", "title": "" }, { "docid": "b1c3ef346e865a00ed0f22d1e57bf6c2", "text": "You might have better luck using Quandl as a source. They have free databases, you just need to register to access them. They also have good api's, easier to use than the yahoo api's Their WIKI database of stock prices is curated and things like this are fixed (www.quandl.com/WIKI ), but I'm not sure that covers the London stock exchange. They do, however, have other databases that cover the London stock exchange.", "title": "" }, { "docid": "625a988bfb55940701a041358b283f3b", "text": "Some of the ETFs you have specified have been delisted and are no longer trading. If you want to invest in those specific ETFs, you need to find a broker that will let you buy European equities such as those ETFs. Since you mentioned Merrill Edge, a discount broking platform, you could also consider Interactive Brokers since they do offer trading on the London Stock Exchange. There are plenty more though. Beware that you are now introducing a foreign exchange risk into your investment too and that taxation of capital returns/dividends may be quite different from a standard US-listed ETF. In the US, there are no Islamic or Shariah focussed ETFs or ETNs listed. There was an ETF (JVS) that traded from 2009-2010 but this had such little volume and interest, the fees probably didn't cover the listing expenses. It's just not a popular theme for North American listings.", "title": "" }, { "docid": "b8bc5ac6fc7eafb3ec03c29d82e651ec", "text": "\"The London Stock Exchange offers a wealth of exchange traded products whose variety matches those offered in the US. Here is a link to a list of exchange traded products listed on the LSE. The link will take you to the list of Vanguard offerings. To view those offered by other managers, click on the letter choices at the top of the page. For example, to view the iShares offerings, click on \"\"I\"\". In the case of Vanguard, the LSE listed S&P500 ETF is traded under the code VUSA. Similarly, the Vanguard All World ETF trades under the code VWRL. You will need to be patient viewing iShares offerings since there are over ten pages of them, and their description is given by the abbreviation \"\"ISH name\"\". Almost all of these funds are traded in GBP. Some offer both currency hedged and currency unhedged versions. Obviously, with the unhedged version you are taking on additional currency risk, so if you wish to avoid currency risk then choose a currency hedged version. Vanguard does not appear to offer currency hedged products in London while iShares does. Here is a list of iShares currency hedged products. As you can see, the S&P500 currency hedged trades under the code IGUS while the unhedged version trades under the code IUSA. The effects of BREXIT on UK markets and currency are a matter of opinion and difficult to quantify currently. The doom and gloom warnings of some do not appear to have materialised, however the potential for near-term volatility remains so longs as the exit agreement is not formalised. In the long-term, I personally believe that BREXIT will, on balance, be a positive for the UK, but that is just my opinion.\"", "title": "" }, { "docid": "9e1bd8222fab6420ee6d31859fb24346", "text": "\"Although this is an old question, it's worth pointing out that the Google Stock Screener now supports stocks traded on the London Stock Exchange. From the country dropdown on the left, select \"\"United Kingdom\"\" and use the screener as before.\"", "title": "" }, { "docid": "ebdb1628c3593302cee0c498228e0163", "text": "\"Wrong. Business lending has boomed under QE.. does the term \"\"cov-lite\"\" sound familiar? That's because there's so much liquidity, that they're willing to lend to companies with little to no restrictions. There is so much credit to go around, that a \"\"High Yield Bond\"\" can price at L+800 bps. When you're taking all the risk of a HY issuer, and maxing your return at 8.5%-9%, it's not too appealing. Instead, you could take a bit more risk, but also get all of the potential upside of equities. 1. Fed buys assets, injects money into banks. 2. Banks, flush with liquidity, need to put their balance sheet to use and begin lending to everyone. 2. Bond market flooded with supply, causes bond yields to drop to historic lows. 3. Investors don't enjoy limiting upside for incredibly low returns, and begin flooding equity markets to get some sort of yield. Business lending is booming, making equities the only place to get larger returns.\"", "title": "" }, { "docid": "3294cc3ac110d2d7324b53bdd16c05e7", "text": "Wikipedia is your friend: http://en.wikipedia.org/wiki/List_of_stock_exchanges", "title": "" }, { "docid": "c4358d19edb2a53d219d633e838d8e96", "text": "There are multiple places where you can see this. Company house website On any financial news website, if you have access e.g. TESCO on FT On any 3rd party website which supply information on companies e.g. TESCO on Companycheck An observation though, FT lists down more shareholders for me than Companycheck as I pay for FT.", "title": "" }, { "docid": "e8c5450e3d1e6e492f587ae662fb9d9e", "text": "\"I kind of understand the \"\"basics\"\", and have done a couple (with the assistance of pre-made excel sheets haha), I just don't feel that I'm creating an actual valuable valuation when I do one. While on the topic though, do you know where an individual investor can calculate the cost of debt for the WACC? I've been looking on morningstar and search up that public company and take the average of the coupon on all outstanding bonds. I don't feel like that's very correct though :(\"", "title": "" } ]	fiqa
5b3e1f3a60ef4723d43b2ff669bd930d	How much financial information should a buyer give an estate agent?	[ { "docid": "57e48b2c7795653180c80ca8958191f2", "text": "\"My guess is they are fishing for business for their in-house finance person. In the UK, all the estate agency chains (and many of the smaller outfits) have financial advice firms they are affiliated with, often to the extent that a desk in each branch will be for 'the finance guy' (it's usually a guy). The moment you show any sign of not quite having the finances for a place you like, they will offer you a consultation with the finance guy, who \"\"will be able to get you a deal\"\". On commission, of course. What you need to say with regards to financing is (delete as applicable) \"\"I am a cash buyer\"\" / \"\"I have an Agreement In Principle\"\". And that's it. They do not 'need' to know any more, and they are under obligation to pass your offer on to the vendor.\"", "title": "" }, { "docid": "ffe9ee151e013016633159ed412829cc", "text": "Estate agents need the amount of deposit you will put down because they want to be able to assess the viability of your mortgage plans. If you have a high deposit (or are a cash buyer) that makes you an attractive buyer, and they can use it as leverage in your favour. It may also give them an idea of whether you could afford to pay more if you found a more expensive house you really liked.", "title": "" } ]	[ { "docid": "58be026b69e764ad156771ce303b2029", "text": "To add to ChrisInEdmonton's answer: Your conveyancing solicitor should be able to advise on the details, but a typical arrangement involves: As an alternative to the numbers in Chris' answer, it could be argued that you should first be reimbursed for the fees you paid (accounting for inflation), but that any remaining profits from the property itself should be divided in proportion to your individual investments (so 51.6% to you, and 48.4% to your partner, assuming you contribute to the loans equally).", "title": "" }, { "docid": "23b6f4cc7a062574252fae52b1dd5397", "text": "A rule of thumb I like to follow when purchasing things from CL listed well below value is this.. Assess the level of affluence of the seller. People living in poor neighborhoods are much more likely to try and hide things that would deter buyers as they are more likely to need the money. I find that when I go to a big house with 4 cars in the driveway the seller is more likely to be honest because she likely doesn't need the money from the sale. Edit: I seem to have angered the PC police with this answer. This is based on facts and statistics, not my opinion. I have no bias against poor people.", "title": "" }, { "docid": "a06533d7177634bb712fb080219b3f5b", "text": "The seller has a legitimate desire to know of your preapproval. I have two current anecdotes on this issue. As a realtor helping a client buy a home, I worked closely with buyer's bank, and got a pre-approval for the amount we were offering. When there was a counteroffer, and we were going to raise the price, the bank upped the numbers on the pre-approval letter. I have a property of my own I am trying to sell. I had a negotiated price, P&S, but no pre-approval from the buyer. The buyer of his home couldn't get a mortgage, and so far, the deal has fallen through. I agree with you, you don't want to signal you can afford more, nor show any emotion about how great that house is. That's just giving the seller a bargaining chip.", "title": "" }, { "docid": "b2fbd2fff45199d02a30d6be5e70281f", "text": "Your adviser cannot advise you if you don't tell him the whole picture. You don't have to invest everything with the adviser, you can just say that you have the cash allocation portion already invested elsewhere, and he can consider your portfolio based on that information. He works for you and you pay him for this work, why would you want him to provide a result that you know is worthless, because you didn't tell him what he needs to know?", "title": "" }, { "docid": "ef6251beb395b3ce7201d8f108e1c6cc", "text": "Whether applying for a job or buying a house, Offer a more specific price like $72,500, which tells them you thought hard about the price. $70K is too 'round' of a number. Additionally, your financial ability/condition can be a factor too. If you have 20% down, and your Realtor assures the seller that your transaction will go down without a hitch, and you'll be approved for a mortgage, they may accept your offer of $72,500 over the other guys $78K offer if [s]he has less desirable finances. Good Luck!", "title": "" }, { "docid": "83ab38287c21b4283e6a336cae5294fb", "text": "Hi I am assuming you are doing this in the US? I run a social media / content marketing agency in the UK, Some of our very first clients were real estate agents, the idea we had was to market properties through Facebook using interior and exterior video shots to commercial music, This took off with some estate agents and not so much with others, My biggest piece of advice find a chain and start there that way you will get a hell of a lot of recognition by the smaller firms, You need to find a realistic price point for your clients that is measurable on the ROI and ultimately pays for your lifestyle. I started at £200 which is $257 dollars - arguably very underpriced but it gave me the opportunity to work with a cluster of people, I even went to the extreme of offering free work so I could get work for the portfolio! In terms of who to contact and how to find them.. enter Linkedin.com your new best friend - connect with real estate developers, buyers, owners you name it then informally introduce yourself and ask when they are free for a coffee. Post an article about why video and drone footage is the next big thing for real estate, don't be afraid to ask for the business at the end of the day you are providing cold hard value. I've always tried to get retainer deals with clients in the real estate sector but to achieve this you have to talk to the big boys and not independent firms. I could be wrong though I haven't done business with a lot of people in the states so definitely something to keep in mind. A good lot of this business idea is trial and error but I agree with it 100% just go and do basically, Hope this helps - I am happy to show you some of my work if you want to shoot me over a private message!", "title": "" }, { "docid": "df5527df899950b6cbc702027a4673cc", "text": "\"The real estate agent industry is a cartel. They seek to keep fees high even as their services are becoming less and less necessary. To that end, traditional seller's agents will laugh at your attempt to negotiate their fee. They can do this quite simply because the industry is designed so the vast majority of people think of buyer's agents as \"\"free\"\" even when they are anything but free. That being said, the only way to do what you're trying to do is to find a buyer's agent who will rebate to you a portion of the commission they receive. It is extremely extremely unlikely you'll get a seller's agent to play ball especially once they know you're interested. You can check out redfin which connects people to RE agents that rebate commissions but the buyer's cut isn't that high. Your best bet, IMO, is to contact agents in your area before you go shopping to see what kind of rebate you can negotiate with them. A word of caution, if you look at a house without your own agent, instead asking the seller's agent to show the house they will claim procuring clause and you'll be sunk. In other words, once they claim procuring clause, you can't, later, go back and get a discount broker to get the commission to rebate to you.\"", "title": "" }, { "docid": "fc1f5ed2c1250c7cf1fbdfde726a122d", "text": "Here, you can get a professional recommendation approximately any most important issues and the way they may affect the belongings over time. We offer you better inspection carrier all of that, it's miles an Australia's maximum trusted employer. We will offer you and your property agent with assets to help marketplace the document as one of a number of techniques that permit you to control the sale technique of a pre sale inspections. As one among a number of strategies that let you manage the sale technique. We tell you the real condition of the interior and exterior of the building.", "title": "" }, { "docid": "59737251d36622741b945a786416c7ac", "text": "\"In a hot market, aka a \"\"sellers market\"\", rates are low, money readily available, housing inventory low, and demand high. It's not rocket science, and in fact, the only thing the buyer is likely to need from his agent is advice on price. Is it possible the fair price attracts a buyer on day one? Sure. But it's far more likely the house should have been listed higher. Perhaps a lot higher. (Disclosure - I am an agent) I'd rather set a price too high, and agree with the seller that we have room to go down, than to sell on day one at a low price, wondering how much money I just lost my client. Even if an offer came at asking price on the first day, in a hot market, the right answer is \"\"we are entertaining a number of offers, please confirm your best and final by next Friday.\"\"\"", "title": "" }, { "docid": "bdfc3e853580c00d5da19e51a2631af0", "text": "\"Based on what you asked and your various comments on other answers, this is the first time that you will be making an offer to buy a house, and it seems that the seller is not using a real-estate agent to sell the house, that is, it is what is called a FSBO (for sale by owner) property (and you can learn a lot of about the seller's perspective by visiting fsbo.com). On the other hand, you are a FTB (first-time buyer) and I strongly recommend that you find out about the purchase process by Googling for \"\"first-time home buyer\"\" and reading some of the articles there. But most important, I urge you DO NOT make a written offer to purchase the property until you understand a lot more than you currently do, and a lot more than all the answers here are telling you about making an offer to buy this property. Even when you feel absolutely confident that you understand everything, hire a real-estate lawyer or a real-estate agent to write the actual offer itself (the agent might well use a standard purchase offer form that his company uses, or the State mandates, and just fill in the blanks). Yes, you will need to pay a fee to these people but it is very important for your own protection, and so don't just wing it when making an offer to purchase. As to how much you should offer, it depends on how much you can afford to pay. I will ignore the possibility that you are rich enough that you can pay cash for the purchase and assume that you will, like most people, be needing to get a mortgage loan to buy the house. Most banks prefer not to lend more than 80% of the appraised value of the house, with the balance of the purchase price coming from your personal funds. They will in some cases, loan more than 80% but will usually charge higher interest rate on the loan, require you to pay mortgage insurance, etc. Now, the appraised value is not determined until the bank sends its own appraiser to look at the property, and this does not happen until your bid has been accepted by the seller. What if your bid (say $500K) is much larger than the appraised value $400K on which the bank is willing to lend you only $320K ? Well, you can still proceed with the deal if you have $180K available to make the pay the rest. Or, you can let the deal fall apart if you have made a properly written offer that contains the usual contingency clause that you will be applying for a mortgage of $400K at rate not to exceed x% and that if you can't get a mortgage commitment within y days, the deal is off. Absent such a clause, you will lose the earnest money that you put into escrow for failure to follow through with the contract to purchase for $500K. Making an offer in the same ballpark as the market value lessens the chances of having the deal fall through. Note also that even if the appraised value is $500K, the bank might refuse to lend you $400K if your loan application and credit report suggest that you will have difficulty making the payments on a $400K mortgage. It is a good idea to get a pre-approval from a lender saying that based on the financial information that you have provided, you will likely be approved for a mortgage of $Z (that is, the bank thinks that you can afford the payments on a mortgage of as much as $Z). That way, you have some feel for how much house you can afford, and that should affect what kinds of property you should be bidding on.\"", "title": "" }, { "docid": "98b07a3bada1706a14716f012eaff827", "text": "\"Accounting for this properly is not a trivial matter, and you would be wise to pay a little extra to talk with a lawyer and/or CPA to ensure the precise wording. How best to structure such an arrangement will depend upon your particular jurisdiction, as this is not a federal matter - you need someone licensed to advise in your particular state at least. The law of real estate co-ownership (as defined on a deed) is not sufficient for the task you are asking of it - you need something more sophisticated. Family Partnership (we'll call it FP) is created (LLC, LLP, whatever). We'll say April + A-Husband gets 50%, and Sister gets 50% equity (how you should handle ownership with your husband is outside the scope of this answer, but you should probably talk it over with a lawyer and this will depend on your state!). A loan is taken out to buy the property, in this case with all partners personally guaranteeing the loan equally, but the loan is really being taken out by FP. The mortgage should probably show 100% ownership by FP, not by any of you individually - you will only be guaranteeing the loan, and your ownership is purely through the partnership. You and your husband put $20,000 into the partnership. The FP now lists a $20,000 liability to you, and a $20,000 asset in cash. FP buys the $320,000 house (increase assets) with a $300,000 mortgage (liability) and $20,000 cash (decrease assets). Equity in the partnership is $0 right now. The ownership at present is clear. You own 50% of $0, and your sister owns 50% of $0. Where'd your money go?! Simple - it's a liability of the partnership, so you and your husband are together owed $20,000 by the partnership before any equity exists. Everything balances nicely at this point. Note that you should account for paying closing costs the same as you considered the down payment - that money should be paid back to you before any is doled out as investment profit! Now, how do you handle mortgage payments? This actually isn't as hard as it sounds, thanks to the nature of a partnership and proper business accounting. With a good foundation the rest of the building proceeds quite cleanly. On month 1 your sister pays $1400 into the partnership, while you pay $645 into the partnership. FP will record an increase in assets (cash) of $1800, an increase in liability to your sister of $1400, and an increase in liability to you of $645. FP will then record a decrease in cash assets of $1800 to pay the mortgage, with a matching increase in cost account for the mortgage. No net change in equity, but your individual contributions are still preserved. Let's say that now after only 1 month you decide to sell the property - someone makes an offer you just can't refuse of $350,000 dollars (we'll pretend all the closing costs disappeared in buying and selling, but it should be clear how to account for those as I mention earlier). Now what happens? FP gets an increase in cash assets of $350,000, decreases the house asset ($320,000 - original purchase price), and pays off the mortgage - for simplicity let's pretend it's still $300,000 somehow. Now there's $50,000 in cash left in the partnership - who's money is it? By accounting for the house this way, the answer is easily determined. First all investments are paid back - so you get back $20,000 for the down payment, $645 for your mortgage payments so far, and your sister gets back $1400 for her mortgage payment. There is now $27,995 left, and by being equal partners you get to split it - 13,977 to you and your husband and the same amount to your sister (I'm keeping the extra dollar for my advice to talk to a lawyer/CPA). What About Getting To Live There? The fact is that your sister is getting a little something extra out of the deal - she get's the live there! How do you account for that? Well, you might just be calling it a gift. The problem is you aren't in any way, shape, or form putting that in writing, assigning it a value, nothing. Also, what do you do if you want to sell/cash out or at least get rid of the mortgage, as it will be showing up as a debt on your credit report and will effect your ability to secure financing of your own in the future if you decide to buy a house for your husband and yourself? Now this is the kind of stuff where families get in trouble. You are mixing personal lives and business arrangements, and some things are not written down (like the right to occupy the property) and this can really get messy. Would evicting your sister to sell the house before you all go bankrupt on a bad deal make future family gatherings tense? I'm betting it might. There should be a carefully worded lease probably from the partnership to your sister. That would help protect you from extra court costs in trying to determine who has the rights to occupy the property, especially if it's also written up as part of the partnership agreement...but now you are building the potential for eviction proceedings against your sister right into an investment deal? Ugh, what a potential nightmare! And done right, there should probably be some dollar value assigned to the right to live there and use the property. Unless you just want to really gift that to your sister, but this can be a kind of invisible and poorly quantified gift - and those don't usually work very well psychologically. And it also means she's going to be getting an awfully larger benefit from this \"\"investment\"\" than you and your husband - do you think that might cause animosity over dozens and dozens of writing out the check to pay for the property while not realizing any direct benefit while you pay to keep up your own living circumstances too? In short, you need a legal structure that can properly account for the fact that you are starting out in-equal contributors to your scheme, and ongoing contributions will be different over time too. What if she falls on hard times and you make a few of the mortgage payments? What if she wants to redo the bathroom and insists on paying for the whole thing herself or with her own loan, etc? With a properly documented partnership - or equivalent such business entity - these questions are easily resolved. They can be equitably handled by a court in event of family squabble, divorce, death, bankruptcy, emergency liquidation, early sale, refinance - you name it. No percentage of simple co-ownership recorded on a deed can do any of this for you. No math can provide you the proper protection that a properly organized business entity can. I would thus strongly advise you, your husband, and your sister to spend the comparatively tiny amount of extra money to get advice from a real estate/investment lawyer/CPA to get you set up right. Keep all receipts and you can pay a book keeper or the accountant to do end of the year taxes, and answer questions that will come up like how to properly account for things like depreciation on taxes. Your intuition that you should make sure things are formally written up in times when everyone is on good terms is extremely wise, so please follow it up with in-person paid consultation from an expert. And no matter what, this deal as presently structured has a really large built-in potential for heartache as you have three partners AND one of the partners is also renting the property partially from themselves while putting no money down? This has a great potential to be a train wreck, so please do look into what would happen if these went wrong into some more detail and write up in advance - in a legally binding way - what all parties rights and responsibilities are.\"", "title": "" }, { "docid": "0da8c2414ebdc46df7f1a8d8ddcacf03", "text": "Warranties are usually sold at 60-90% margin. They are just about always a bad deal. If you are forced to buy one, negotiate on price, and be wary of realtor or mortgage broker recommendations.", "title": "" }, { "docid": "63e51e8915f6b5fad4b0c2e725767892", "text": "I'm surprised by all these complicated answers. Yes @Victor, you can create a form that asks people to put down their financial information but you want to be careful and not put off potential tenants by asking for too many details. Depending on the OP's typical tenants, an extensive background and credit check may not be necessary. For example, if I have proof that someone is a graduate student at the local university, that's usually good enough for me because I am willing to bet that they will follow my contract. Bidding war doesn't sound doable, you advertise a price correct? You can only be haggled down not up. So my suggestion is to look at other rental advertisements in the area. Compare what you're offering (location, quality of house, cleanliness, amenities, etc) to the competition and price accordingly. If you're getting a flood of interest, then you're probably pricing below the average price in your area. Or you live in an area where demand is just much higher than supply, in which case you can also raise your rent.", "title": "" }, { "docid": "88890edbedd3979b6a8244e4a8df8b85", "text": "\"Here in the UK, the rule of thumb is to keep a lot of equity in your home if you can. I assume here that you have a lot of savings you're considering using. If you only have say 10% of the house price you wouldn't actually have a lot of choice in the matter, the mortgage lender will penalise you heavily for low deposits. The practical minimum is 5%, but for most people a 95% mortgage is just silly (albeit not as silly as the 100% or greater mortgages you could get pre-2008), and you should take serious individual advice before considering it. According to Which, the average in the UK for first-time buyers is 20% (not the best source for that data I confess, but a convenient one). Above 20% is not at all unusual. You'll do an affordability calculation to figure out how much you can borrow, which isn't at all the same as how much you should borrow, but does get you started. Basically you, decide how much a month you can spend on mortgage payments. The calculation will let you put every penny into this if you choose to, but in practice you'll want some discretionary income so don't do that. decide the term of the mortgage. For a young first-time buyer in the UK I think you'd typically take a 25-year term and consider early repayment options rather than committing to a shorter term, but you don't have to. Mortgage lenders will offer shorter terms as long as you can afford the payments. decide how much you're putting into a deposit make subtractions for cost of moving (stamp duty if applicable, fees, removals aka \"\"people to lug your stuff\"\"). receive back a number which is the house price you can pay under these constraints (and of course a breakdown of what the mortgage principle would be, and the interest rate you'll pay). This step requires access to lender information, since their rates depend on personal details, deposit percentage, phase of the moon, etc. Our mortgage advisor did multiple runs of the calculation for us for different scenarios, since we hadn't made up our minds entirely. Since you have not yet decided how much deposit to make, you can use multiple calculations to see the effect of different deposits you might make, up to a limit of your total savings. Putting up more deposit both increases the amount you can borrow for a given monthly payment (since mortgage rates are lower when the loan is a lower proportion of house value), and of course increases the house price you can afford. So unless you're getting a very high return on your savings, £1 of deposit gets you somewhat more than £1 of house, and the calculation will tell you how much more. Once you've chosen the house you want, the matter is even simpler: do you prefer to put your savings in the house and borrow less and make lower payments, or prefer to put your savings elsewhere and borrow more and make higher payments but perhaps have some additional income from the savings. Assuming you maintain a contingency fund, a lower mortgage is generally considered a good investment in the UK, but you need to check what's right for you and compare it to other investments you could make. The issue is complicated by the fact that residential property prices are rising quite quickly in most areas of the UK, and have been for a long time, meaning that highly-leveraged property investment appears to be a really good idea. This leads to the imprudent, but tempting, conclusion that you should buy the biggest house you can possibly afford and watch its value rises. I do not endorse this advice personally, but it's certainly true that in a sharply rising house market it's easier to get away with buying a bigger house than you need, than it is to get away with it in a flat or falling market. As Stephen says, an offset mortgage is a no-brainer good idea if the rate is the same. Unfortunately in the UK, the rate isn't the same (or anyway, it wasn't a couple of years ago). Offset mortgages are especially good for those who make a lot of savings from income and for any reason don't want to commit all of those savings to a traditional mortgage payment. Good reasons for not wanting to do that include uncertainty about your future income and a desire to have the flexibility to actually spend some of it if you fancy :-)\"", "title": "" }, { "docid": "277d4423be680399e5c346d4177ce244", "text": "In the UK at least, dealers definitely want you to take finance. They get benefits from the bank (which are not insubstantial) for doing this; these benefits translate directly to increased commission and internal rewards for the individual salesman. It's conceivable that the salesman will be less inclined to put himself out for you in any way by sweetening your deal as much as you'd like, if he's not going to get incentives out of it. Indeed, since he's taking a hit on his commission from you paying in cash, it's in his best interests to perhaps be firmer with you during price negotiation. So, will the salesman be frustrated with you if you choose to pay in cash? Yes, absolutely, though this may manifest in different ways. In some cases the dealer will offer to pay off the finance for you allowing you to pay directly in cash while the dealer still gets the bank referral reward, so that everyone wins. This is a behind-the-scenes secret in the industry which is not made public for obvious reasons (it's arguably verging on fraud). If the salesman likes you and trusts you then you may be able to get such an arrangement. If this does not seem likely to occur, I would not go out of my way to disclose that I am planning to pay with cash. That being said, you'll usually be asked very early on whether you are seeking to pay cash or credit (the salesman wants to know for the reasons outlined above) and there is little use lying about it when you're shortly going to have to come clean anyway.", "title": "" } ]	fiqa
0edd5fc1a55c07a6bb3feb1254172a49	Free service for automatic email stock alert when target price is met?	[ { "docid": "9b8834fbccc5971800907f56b7c5afdd", "text": "Sure, Yahoo Finance does this for FREE.", "title": "" }, { "docid": "1de4f9aa53884a7706ec901cd7a5d604", "text": "\"http://finance.yahoo.com/stock-alerts/stock-watch/add/?.done=/stock-alerts/ You will have to have a yahoo account. If you want to provide an alternative delivery email address, visit the URL above. Click \"\"Stocks Watch\"\", enter ticker(s) and price(s) at which you want alerts, then at the bottom select the \"\"email\"\" radio button. If your preferred email address is not listed, click the \"\"Add an email address\"\" link and follow the instructions. I don't know what their limit is, but I currently have three addresses set up -- two to non-@yahoo addresses -- and it works fine.\"", "title": "" }, { "docid": "091a391b4b94a0f22804364eb88fe280", "text": "You can do it graphically at zignals.com and freestockcharts.com.", "title": "" }, { "docid": "99606fba681bb49a9a1a8b432c5440c5", "text": "Hey guys, I found this website, it seems to do it for free, and they have many options. If let me know if you find something better than this. http://members.zignals.com/main/", "title": "" }, { "docid": "0985481e9f73fca898466d7f62d286ab", "text": "If you're a customer, TD Ameritrade has a really robust alerting system.", "title": "" }, { "docid": "0790763ce1214e0a9fa81798f3e2e128", "text": "I've used BigCharts (now owned by MarketWatch.com) for a while and really like them. Their tools to annotate charts are great.", "title": "" }, { "docid": "e853758f05e570fe21d8ba61816753d6", "text": "Yes, there are plenty of sites that will do this for you. Yahoo, and MarketWatch are a few that come to mind first. I'm sure you could find plenty of others.", "title": "" } ]	[ { "docid": "705ee9b2dcdf79ccdb72df415ee392af", "text": "thanks. I have real time quotes, but in the contest, if you put in a market order the trade might happen at the delayed quote price and not the real time price. Does anyone know at which price it will trade, delayed or real time?", "title": "" }, { "docid": "992dc4a9ec3108d705e47fbb0ccb0bf4", "text": "\"Real-time equity (or any other market) data is not available for free anywhere in the US. It is always delayed by 10-15 minutes. On the other hand, online brokers who target the \"\"day trader\"\" (Interactive Brokers, TD Ameritrade, etc.) offer much closer to real-time data AND feature all the tools/alerts/charts/etc. you could ever possibly dream of. I bet the type of alert you're asking for is available with just a couple of clicks on one of these brokers' platforms. Of course, accounts with these online brokers are not free; you must pay for these sophisticated tools and fast market access. Another down side is that the data feeds sent to you by even the most sophisticated online broker are still delayed by tens of seconds compared to the data feeds used by big banks and professional investors. Not to mention that the investment arm of the broker you use will be making its own trades based on the data feeds before relaying them on to you. So this begs the question: why do you need real-time information? Are you trying to \"\"day trade\"\" -- i.e. profit from minute-to-minute fluctuations in the stock market? (I can't in good conscience recommend that, but best of luck to you.) If on the other hand you don't truly need \"\"real-time\"\" data for your application, then I support @ChrisDegnen's approach -- use public data feeds and write your own software. You probably will not find any free tools for the sort of alerting you're looking for because most folks who want these types of alerts also need faster feeds and are therefore already using an online broker's tools.\"", "title": "" }, { "docid": "5984c0c4c0baff7438067b30546e4b1c", "text": "\"AOL Mail (stylized as Aol Mail) is a free web-based email service provided by AOL, a division of Verizon Communications. The service is sometimes referred to as AIMMail where \"\"AIM\"\" stands for AOL Instant Messenger.For any issue call toll free number +61-283206015 to get quick solution.\"", "title": "" }, { "docid": "3d58f98963f60b0132ca92e895b7293a", "text": "\"Wouldn't this be part of your investing strategy to know what price is considered a \"\"good\"\" price for the stock? If you are going to invest in company ABC, shouldn't you have some idea of whether the stock price of $30, $60, or $100 is the bargain price you want? I'd consider this part of the due diligence if you are picking individual stocks. Mutual funds can be a bit different in automatically doing fractional shares and not quite as easy to analyze as a company's financials in a sense. I'm more concerned with the fact that you don't seem to have a good idea of what the price is that you are willing to buy the stock so that you take advantage of the volatility of the market. ETFs would be similar to mutual funds in some ways though I'd probably consider the question that may be worth considering here is how much do you want to optimize the price you pay versus adding $x to your position each time. I'd probably consider estimating a ballpark and then setting the limit price somewhere within that. I wouldn't necessarily set it to the maximum price you'd be willing to pay unless you are trying to ride a \"\"hot\"\" ETF using some kind of momentum strategy. The downside of a momentum strategy is that it can take a while to work out the kinks and I don't use one though I do remember a columnist from MSN Money that did that kind of trading regularly.\"", "title": "" }, { "docid": "5e9f78b304262a787f28122f0e2865ff", "text": "I haven't seen one of these in quite some time. Back in the 1970s, maybe the 1980s, stock brokers would occasionally send their retail clients a complimentary copy once in a while. Also, I remember the local newspaper would offer a year-end edition for a few dollars (maybe $3) and that edition would include the newspaper company's name on the cover. They were very handy little guides measuring 5 1/2 x 8 (horizontal) with one line devoted to each company. They listed hundreds of publicly traded companies and had basic info on each company. As you stated, for further info you needed to go to the library and follow-up with the big S&P and/or Moody's manuals. That was long before the internet made such info available at the click of a button on a home computer!", "title": "" }, { "docid": "699745e7c7937d1720f0f1a34cb89933", "text": "Hi guys, This is an app I've been working on over the summer. It's my belief that a lot of people want to learn about the stock market but in the end can't because they're turned off by long walls of text you get when you Google about them/read a textbook. I know there are other simplified solutions out there but they're not widely adopted yet and I don't think there are any (?) that were made app first. Anyway, check it out if you can. Appreciate all feedback/comments.", "title": "" }, { "docid": "41d3a9dacac7a4016af8e209ec7fe579", "text": "Yahoo finance does in fact have futures quotes. But I've found them difficult to search for because you also have to know the expiration codes for the contract to find them. S&P 500 Emini quote for June 2012", "title": "" }, { "docid": "8e321b1bf44d18871008ee0bb0e814fe", "text": "I'm actually building a UK stock screener right now. It's more of an exercise in finding out how to work out technical things like MACD and EMA calculations, but if those are the things you're interested in, it's at http://www.pifflevalve.co.uk/screen-builder/ As I say, it's more of a personal project than anything commercial, but it's fun to play with.", "title": "" }, { "docid": "43bdbf79a13a6c8e8d9b9fc4fface6b0", "text": "Bloomberg is really just a huge database. You can look up just about anything you need to know. Launchpad is much better than the old NW market monitors. The Excel API is useful. If it wasn't where all my brokers are I would consider something different like Eikon. It has some limitations but it's a useful system and parts of my job would be a pain without it.", "title": "" }, { "docid": "646d740938295d35af899582a87fef54", "text": "\"Yes, there are a lot of places you can research stocks online, Google Finance, Yahoo Finance, Reuters etc. It's important to understand that the price of the stock doesn't actually mean anything. Share price is just a function of the market capitalization divided by the number of shares outstanding. As an example take two companies that are both worth $1 million, but Company A has issued 10,000 shares and Company B has issued 100,000 shares. Company A has a share price of $100 while Company B has a share price of just $10. Comparing share price does nothing to indicate the relative value or health of Company A versus Company B. I know there are supposed to be no product recommendations but the dictionary area of investopedia.com is a good source of beginner investing information. And as Joe points out below the questions here with the \"\"stock\"\" tag would also be a good place to start. And while I'm on a roll, the book \"\"A Random Walk Down Wall Street\"\" is a good starting point in investing in the stock market.\"", "title": "" }, { "docid": "c7e85b5175eb7557058a06f4ece1e8e9", "text": "Sort of unrelated to the main post here, but I've been hoping to buy a few shares that would motivate me to follow the market and get a bit of hands on experience to better understand it all. What trading program would you recommend for a few simple trades like that? Thanks!", "title": "" }, { "docid": "58508326ca40b024e9d896173d8c4094", "text": "Take a look at this: http://code.google.com/p/stock-portfolio-manager/ It is an open source project aimed to manage your stock portfolio.", "title": "" }, { "docid": "902596c59a47fa18569e3dfee25ff68c", "text": "Depends on the exchange, and it's usually not going to be free. I use IB's API, and I've heard good things about IQFeed. You can get some free book data from Bats, but again you probably won't see your own transactions go by. http://batstrading.com/market_data/", "title": "" }, { "docid": "a6cbcbd8b3cddff05df38d1e7b8f0339", "text": "I won't be able to model stock prices using this information. The pros aren't likely to use Google as much. Even the casual investor is likely to have his own habits. For example, I've come to like how Yahoo permits me to set up a portfolio and follow the stocks I want. And the information that interests me is there, laid out nicely, price, history, insider trades, news etc. But your effort probably still has some discovery value, as it will help you understand when interest in a company suddenly swells above normal. Nothing wrong with a good project like that. Just don't expect to extract too much market-beating success from it. The pros will eat your lunch, take your money, and not even say thanks. Welcome to Money.SE.", "title": "" }, { "docid": "41d8fdff82afc393afa41b1b7afff9bc", "text": "\"Note: the answer below is speculative and not based on any first-hand knowledge of pump-and-dump schemes. The explanation with spamming doesn't really makes sense for me. Often you see a stock jump 30% or more in a single day at a particular moment in time. Unlikely that random people read their emails at that time and decide to buy. What I think happens is the pumper does a somewhat risky thing: starts buying a lot of shares of a stock that has declined a lot and had low volumes during the previous days. As the price starts to increase other people start to notice the jump and join the buying spree (also don't forget that some probably use buy-stop orders which are triggered when the price reaches a particular level). Also there should be some automatic trading involved (maybe HFT firms do pump-and-dumps) as you have to trade a big volume in a relatively short time span. I think it is unlikely to be done by human operators. Another explanation would be that there is a group of pumpers (to spread the risk so to speak). Update: As I think more of it, it is not necessary to buy \"\"a lot of shares\"\". You could buy some shares, sell them to another pumper and buy from them again at a higher price in several iterations. I think this could also work if you do it fast enough. These scheme makes sense only you previously bought many shares at the low price, possibly during several weeks. Once the price is pumped high enough you can start selling the shares you previously bought (in the days preceding the pump).\"", "title": "" } ]	fiqa
ab213d1097b764a8a6a1f730ce738e08	Is there an online cost-basis calculator that automatically accounts for dividend re-investments and splits?	[ { "docid": "3daa8dfcc2bb62b6a3a6ee4291dda11f", "text": "Google Finance portfolios take into account splits and cash deposits/withdrawals.", "title": "" }, { "docid": "2cb94464a77b00425f9ce06a9382f6db", "text": "Reinvestment creates a nightmare when it comes time to do taxes, sadly. Tons of annoying little transactions that happened automatically... Here's one article trying to answer your question: http://www.smartmoney.com/personal-finance/taxes/figuring-out-your-cost-basis-when-youve-lost-the-statements-9529/ You could also try this thing: http://www.gainskeeper.com/us/BasisProIndividual.aspx But I couldn't tell you if it would help. If it makes you feel better, brokerages are now required by the IRS to track your basis for you, so for new transactions and assets you shouldn't end up in this situation. Doesn't help with the old stuff ;-)", "title": "" }, { "docid": "51b8666a42d8e6aa0626cd4367ee50a7", "text": "Calculating and adjusting cost basis accurately is a daunting task, but there is a (paid) online tool, NetBasis, which will automatically calculate and adjust your cost basis. It is used by brokerage firms and Fortune 500 companies and is available to the public. Go to netbasis.com. All you need are the purchase and sale dates and shares of the stock or mutual fund and the system has the rest of the information, such as corporate actions (splits, spin-offs, etc), pricing, and dividends and it also will apply the appropriate IRS rules for inherited and gifted shares. The regulation also gives investors the option to choose calculation methods. Not only does NetBasis automatically calculate the method you choose, it will also give the results for all options and allow you to choose the best result. NetBasis also provides you with detailed supporting documentation which shows all of the calculations and the adjustments in chronological order. NetBasis has data going back as far as 1925, so it will accurately calculate cost basis for your old American Telegraph and Telephone shares. NetBasis also handles complex investment scenarios such as wash sales, short sales, return of capital, etc. Moderator's note: Disclosure: The answerer's profile indicates they are affiliated with NetBasis.", "title": "" } ]	[ { "docid": "67d0933ebc414d7cc9167018cbc619f2", "text": "I am not a tax professional, only an investment professional, so please take the following with a grain of salt and simply as informational guidance, not a personal recommendation or solicitation to buy/sell any security or as personal tax or investment advice. As Ross mentioned, you need to consult a tax advisor for a final answer concerning your friend's personal circumstances. In my experience advising hundreds of clients (and working directly with their tax advisors) the cost basis is used to calculate tax gain or loss on ordinary investments in the US. It appears to me that the Edward Jones description is correct. This has also been the case for me personally in the US with a variety of securities--stocks, options, futures, bonds, mutual funds, and exchange traded funds. From the IRS: https://www.irs.gov/uac/about-form-1099b Form 1099-B, Proceeds From Broker and Barter Exchange Transactions A broker or barter exchange must file this form for each person: Edward Jones should be able to produce a 1099b documenting the gains/losses of any investments. If the 1099b document is confusing, they might have a gain/loss report that more clearly delineates proceeds, capital returns, dividends, and other items related to the purchase and sale of securities.", "title": "" }, { "docid": "7e6a30f5616e94418f406aebfface37b", "text": "Have you looked into GnuCash? It lets you track your stock purchases, and grabs price updates. It's designed for double-entry accounting, but I think it could fit your use case.", "title": "" }, { "docid": "1ebc364846535cd64021290e9b7af494", "text": "You could create your own spreadsheet of Cash Flows and use the XIRR function in Excel: The formula is:", "title": "" }, { "docid": "7e1b383fd0db28de0e0948544e307d5f", "text": "Yes, add the stocks/mutual funds that you want and then you would just need to add all the transactions that you theoretically would have made. Performing the look up on the price at each date that you would have sold or bought is quite tedious as well as adding each transaction.", "title": "" }, { "docid": "eaf8fbb6297344fa58d97ad8831b11ca", "text": "Having all of the numbers you posted is a start. It's what you need to perform the calculation. The final word, however, comes from the company itself, who are required to issue a determination on how the spin-off is valued. Say a company is split into two. Instead of some number of shares of each new company, imagine for this example it's one for one. i.e. One share of company A becomes a share each in company B and company C. This tell us nothing about relative valuation, right? Was B worth 1/2 of the original company A, or some other fraction? Say it is exactly a 50/50 split. Company A releases a statement that B and C each should have 1/2 the cost basis of your original A shares. Now, B and C may very well trade ahead of the stock splitting, as 'when issued' shares. At no point in time will B and C necessarily trade at exactly the same price, and the day that B and C are officially trading, with no more A shares, they may have already diverged in price. That is, there's nothing you can pull from the trading data to identify that the basis should have been assigned as 50% to each new share. This is my very long-winded was of explaining that the company must issue a notice through your broker, and on their investor section of their web site, to spell out the way you should assign your basis to each new stock.", "title": "" }, { "docid": "a12da22d330b7e220f7cd8e070ac02ec", "text": "\"You can calculate the \"\"return on investment\"\" using libreoffice, for example. Look at the xirr function. You would have 2 columns, one a list of dates (ie the dates of the deposits or dividends or whatever that you want to track, the last entry would be today's date and the value of the investment today. The xirr function calculates the internal rate of return for you. If you add money to the account, and the current value includes the original investment and the added funds, it will be difficult to calculate the ROI. If you add money by purchasing additional shares (or redepositing dividends by buying additional shares), and you only want to track the ROI of the initial investment (ignoring future investments), you would have to calculate the current value of all of the added shares (that you don't want to include in the ROI) and subtract that value from the current total value of the account. But, if you include the dates and values of these additional share purchases in the spreadsheet, xirr will calculate the overall IRR for you.\"", "title": "" }, { "docid": "289270da721e0e136ede814135c932bf", "text": "\"Re. question 2 If I buy 20 shares every year, how do I get proper IRR? ... (I would have multiple purchase dates) Use the money-weighted return calculation: http://en.wikipedia.org/wiki/Rate_of_return#Internal_rate_of_return where t is the fraction of the time period and Ct is the cash flow at that time period. For the treatment of dividends, if they are reinvested then there should not be an external cash flow for the dividend. They are included in the final value and the return is termed \"\"total return\"\". If the dividends are taken in cash, the return based on the final value is \"\"net return\"\". The money-weighted return for question 2, with reinvested dividends, can be found by solving for r, the rate for the whole 431 day period, in the NPV summation. Now annualising And in Excel\"", "title": "" }, { "docid": "cbe2602216d25f7f2f97e3625c46ea0b", "text": "\"(Value of shares+Dividends received)/(Initial investment) would be the typical formula though this is more of a percentage where 1 would indicate that you broke even, assuming no inflation to be factored. No, you don't have to estimate the share price based on revenues as I would question how well did anyone estimate what kind of revenues Facebook, Apple, or Google have had and will have. To estimate the value of shares, I'd likely consider what does my investment strategy use as metrics: Is it discounted cash flow, is it based on earnings, is it something else? There are many ways to determine what a stock \"\"should be worth\"\" that depending on what you want to believe there are more than a few ways one could go.\"", "title": "" }, { "docid": "a1ae49664cd8b97b99849aab8d3bce30", "text": "Adjustments can be for splits as well as for dividends. From Investopedia.com: Historical prices stored on some public websites, such as Yahoo! Finance, also adjust the past prices of the stock downward by the dividend amount. Thus, that could also be a possible factor in looking at the old prices.", "title": "" }, { "docid": "38bdbd4c2225ed3344f2d36eb24aa6d8", "text": "You can use a tool like WikiInvest the advantage being it can pull data from most brokerages and you don't have to enter them manually. I do not know how well it handles dividends though.", "title": "" }, { "docid": "8f94c2aedfcae7a40f3f9d639c2e702a", "text": "Your investment is probably in a Collective Investment Trust. These are not mutual funds, and are not publicly traded. I.e. they are private to plan participants in your company. Because of this, they are not required* to distribute dividends like mutual funds. Instead, they will reinvest dividends automatically, increasing the value of the fund, rather than number of shares, as with dividend reinvestment. Sine you mention the S&P 500 fund you have tracks closely to the S&P Index, keep in mind there's two indexes you could be looking at: Without any new contributions, your fund should closely track the Total Return version for periods 3 months or longer, minus the expense ratio. If you are adding contributions to the fund, you can't just look at the start and end balances. The comparison is trickier and you'll need to use the Internal Rate of Return (look into the XIRR function in Excel/Google Sheets). *MFs are not strictly required to pay dividends, but are strongly tax-incentivized to do so, and essentially all do.", "title": "" }, { "docid": "616669427b16951427638365fcc9f849", "text": "I have found The DRiP Investing Resource Center to be a useful resource for more information about DRIP investing. Moneypaper.com offers a list of companies offering both direct purchase options and dividend reinvestment plans. For those offering dividend reinvestment plans, but not direct purchase, you have the option of using a service to purchase your first shares to enroll in the DRIP program. The tax paperwork for DRIPs is a pain due to the partial shares purchased over time when you have to figure out your own cost basis upon sale of shares , but a spreadsheet and a FIFO (first in first out) approach makes it not too much of a headache. -MU", "title": "" }, { "docid": "bf0540111a2051185227f72005547c32", "text": "\"Generally if you are using FIFO (first in, first out) accounting, you will need to match the transactions based on the number of shares. In your example, at the beginning of day 6, you had two lots of shares, 100 @ 50 and 10 @ 52. On that day you sold 50 shares, and using FIFO, you sold 50 shares of the first lot. This leaves you with 50 @ 50 and 10 @ 52, and a taxable capital gain on the 50 shares you sold. Note that commissions incurred buying the shares increase your basis, and commissions incurred selling the shares decrease your proceeds. So if you spent $10 per trade, your basis on the 100 @ 50 lot was $5010, and the proceeds on your 50 @ 60 sale were $2990. In this example you sold half of the lot, so your basis for the sale was half of $5010 or $2505, so your capital gain is $2990 - 2505 = $485. The sales you describe are also \"\"wash sales\"\", in that you sold stock and bought back an equivalent stock within 30 days. Generally this is only relevant if one of the sales was at a loss but you will need to account for this in your code. You can look up the definition of wash sale, it starts to get complex. If you are writing code to handle this in any generic situation you will also have to handle stock splits, spin-offs, mergers, etc. which change the number of shares you own and their cost basis. I have implemented this myself and I have written about 25-30 custom routines, one for each kind of transaction that I've encountered. The structure of these deals is limited only by the imagination of investment bankers so I think it is impossible to write a single generic algorithm that handles them all, instead I have a framework that I update each quarter as new transactions occur.\"", "title": "" }, { "docid": "35ec6ed1d2beb27b9ab3d584c9de8470", "text": "Dividend yield is a tough thing to track because it's a moving target. Dividends are paid periodically the yield is calculated based on the stock price when the dividend is declared (usually, though some services may update this more frequently). I like to calculate my own dividend by annualizing the dividend payment divided by my cost basis per share. As an example, say you have shares in X, Co. X issues a quarterly dividend of $1 per share and the share price is $100; coincidentally this is the price at which you purchased your shares. But a few years goes by and now X issues it's quarterly dividend of $1.50 per share, and the share price is $160. However your shares only cost you $100. Your annual yield on X is 6%, not the published 3.75%. All of this is to say that looking back on dividend yields is somewhat similar to nailing jello to the wall. Do you look at actual dividends paid through the year divided by share price? Do you look at the annualized dividend at the time of issue then average those? The stock price will fluctuate, that will change the yield; depending on where you bought your stock, your actual yield will vary from the published amount as well.", "title": "" }, { "docid": "835aea544af9ee19eb114bf793e8f425", "text": "\"I keep spreadsheets that verify each $ distribution versus the rate times number of shares owned. For mutual funds, I would use Yahoo's historical data, but sometimes shows up late (a few days, a week?) and it isn't always quite accurate enough. A while back I discovered that MSN had excellent data when using their market price chart with dividends \"\"turned on,\"\" HOWEVER very recently they have revamped their site and the trusty URLs I have previously used no longer work AND after considerable browsing, I can no longer find this level of detail anywhere on their site !=( Happily, the note above led me to the Google business site, and it looks like I am \"\"back in business\"\"... THANKS!\"", "title": "" } ]	fiqa
44cf87232b23f4ebd334bc12e35dce90	Can GoogleFinance access total return data?	[ { "docid": "1fe2c6cb65515b9032aed7caae98453f", "text": "\"This is the same answer as for your other question, but you can easily do this yourself: ( initial adjusted close / final adjusted close ) ^ ( 1 / ( # of years sampled) ) Note: \"\"# of years sampled\"\" can be a fraction, so the one week # of years sampled would be 1/52. Crazy to say, but yahoo finance is better at quick, easy, and free data. Just pick a security, go to historical prices, and use the \"\"adjusted close\"\". money.msn's best at presenting finances quick, easy, and cheap.\"", "title": "" }, { "docid": "3451c2779bca4a3422a1edf0de832b52", "text": "At this time, Google Finance doesn't support historical return or dividend data, only share prices. The attributes for mutual funds such as return52 are only available as real-time data, not historical. Yahoo also does not appear to offer market return data including dividends. For example, the S&P 500 index does not account for dividends--the S&P ^SPXTR index does, but is unavailable through Yahoo Finance.", "title": "" } ]	[ { "docid": "43b5e2eff2438cb0614ae2ecf7afe2da", "text": "Yes, Alpha Vantage. As MasticatedTesticle points out, it is worth asking where it originally comes from, but it looked to me like a solid source for, in particular, intraday trading data. Additionally, Yahoo finance is done on R (zoo, PerformanceAnalytics libraries don't work anymore as far as I can tell). The numbers look right to me tho, let me know if things are off.", "title": "" }, { "docid": "ad993468933429d86a8b8e460cafd7cb", "text": "\"Short answer: google finance's market cap calculation is nonstandard (a.k.a. wrong). The standard way of computing the market capitalization of a firm is to take the price of its common stock and multiply by the number of outstanding common stock shares. If you do this using the numbers from google's site you get around $13.4B. This can be verified by going to other sites like yahoo finance and bloomberg, which have the correct market capitalization already computed. The Whole Foods acquisition appears to be very cut-and-dry. Investors will be compensated with $42 cash per share. Why are google finance's numbers wrong for market cap? Sometimes people will add other things to \"\"market capitalization,\"\" like the value of the firm's debt and other debt-like securities. My guess is that google has done something like this. Whole Foods has just over $3B in total liabilities, which is around the size of the discrepancy you have found.\"", "title": "" }, { "docid": "0e4dd0800c43b069a301a33451519f63", "text": "\"I'd start with a Google search for \"\"best backtesting tools.\"\" Does your online brokerage offer anything? You already understand that the data is the important part. The good stuff isn't free. But yeah, if you have some money to spend you can get more than enough data to completely overwhelm you. :)\"", "title": "" }, { "docid": "f88af7a8167c5d60b1d44913022efb1f", "text": "Ya, that's a lot of data - especially considering your relative lack of experience and the likely fact that you have no idea what to do with what you're given. How do you even know you need minute or tick-based bid-ask data? You can get a lot more than OHLC/V/Split/Dividend. You can get: * Book Value; * Dividend information (Amount, yield, ex date, pay date); * EBITDA; * EPS (current AND estimates); * Price/sales ratio; * Price/book value; * Price/earnings ratio; * PEG ratio; * Short ratio; * Market cap. Among other things, all for free.", "title": "" }, { "docid": "a386bedbf0f63f354370e49ebbe1d777", "text": "I still can't understand why there is a price discrepancancy. There isn't. It's the same stock and price differences between such major exchanges will always be minimal. I think you simply haven't paid attention to the date range. It seems Google finance only has data for FRA:BMW reaching back to 2011, so if you try to look at the development of your investment since 2009, you're not getting comparable data.", "title": "" }, { "docid": "841f67a51fe5b559c4ce1db46e0b290f", "text": "The point of a total return index is that it already has accounted for the capital gains + coupon income. If you want to calculate it yourself you'll have to find the on-the-run 10y bond for each distinct period then string them together to calc your total return. Check XLTP if they have anything", "title": "" }, { "docid": "2591ce2451f7d5ac4b526b0f345156c6", "text": "I use Yahoo Finance to plot my portfolio value over time. Yahoo Finance uses SigFig to link accounts (I've linked to Fidelity), which then allows you to see you exact portfolio and see a plot of its historical value. I'm not sure what other websites SigFig will allow you to sync with, but it is worth a try. Here is what the plot I have looks like, although this is slightly out of date, but still gives you an idea of what to expect.", "title": "" }, { "docid": "991cef19bbf007ca750f256f14ac5d3a", "text": "Since the vast majority of fund managers/big investors run private entities, it's not possible to track their performance. It's possible to look at what they are holding (that's never real-time information) and emulate their performance.", "title": "" }, { "docid": "fae50c83913edd7f063607b16dfb1431", "text": "While the S&P500 is not a total return index, there is an official total return S&P500 that includes reinvested dividends and which is typically used for benchmarking. For a long time it was not available for free, but it can currently be found on yahoo finance using the ticker ^SP500TR.", "title": "" }, { "docid": "ae1d9140fa353b223f504333df2c180b", "text": "For whatever reason, I don't believe they offer it. Yahoo does. A google for google finance VIX turns up people asking the question, but no quote on google.", "title": "" }, { "docid": "76e622fc225406dbd70fb144752364dc", "text": "\"You could use any of various financial APIs (e.g., Yahoo finance) to get prices of some reference stock and bond index funds. That would be a reasonable approximation to market performance over a given time span. As for inflation data, just googling \"\"monthly inflation data\"\" gave me two pages with numbers that seem to agree and go back to 1914. If you want to double-check their numbers you could go to the source at the BLS. As for whether any existing analysis exists, I'm not sure exactly what you mean. I don't think you need to do much analysis to show that stock returns are different over different time periods.\"", "title": "" }, { "docid": "9764ba3afd9210806de741e49eaf845a", "text": "\"Google Docs spreadsheets have a function for filling in stock and fund prices. You can use that data to graph (fund1 / fund2) over some time period. Syntax: =GoogleFinance(\"\"symbol\"\", \"\"attribute\"\", \"\"start_date\"\", \"\"num_days\|end_date\"\", \"\"interval\"\") where: This analysis won’t include dividends or distributions. Yahoo provides adjusted data, if you want to include that.\"", "title": "" }, { "docid": "3daa8dfcc2bb62b6a3a6ee4291dda11f", "text": "Google Finance portfolios take into account splits and cash deposits/withdrawals.", "title": "" }, { "docid": "39e680ba097f0ffc975fb39a29e5dcd0", "text": "Check the answers to this Stackoverflow question https://stackoverflow.com/questions/754593/source-of-historical-stock-data a number of potential sources are listed", "title": "" }, { "docid": "d13d7d5d09b57fd32a374cdfbec87f29", "text": "I think you really have to ask yourself if its worth it, the risk/reward. Can you trust a publicly traded company with your data in return for the analytics you can get back from them?", "title": "" } ]	fiqa
1950f4149b4c54481b5ce81a932528b6	Credit card grace period for pay, wait 1 day, charge?	[ { "docid": "a0a837bb59550e224a7b7b583c1f7dc1", "text": "You shouldn't be charged interest, unless possibly because your purchases involve a currency conversion. I've made normal purchases that happened to involve changes in currency. The prices were quoted in US$ to me. On the tail end, though, the currency change was treated as a cash advance, which accrues interest immediately.", "title": "" }, { "docid": "3c20845d1c8484de1456b7cbea74a70d", "text": "\"If I understand you correctly, no you shouldn't be charged interest. Lets say you have a billing cycle of monthly (which usually isn't true). You charge $XX per day, ending up at $1000 at the end of January. So February 1st, your bill for your January billing cycle is $1000, due by Feb 15th (lets say). On February 1st, you continue to charge $XX per day. You go to pay your bill online on Feb 14th (to be safe), and you'll usually see on your credit card website something like: You'd hit \"\"Pay my bill\"\", and you'd usually see these options: At the date your cycle was due (Feb 15th), if you haven't paid your full latest statement (lets say you paid $500), they will charge you interest on the entire balance for the period (so interest on $1000, or lets say $50). The other $500 will roll over to the next month, so your next month you'd be somewhere near a $1550 bill.\"", "title": "" }, { "docid": "68951b4c12af986332c0bdd35a0d268e", "text": "This will not result in any finance charges: I wouldn't recommend cutting it quite so close, but as long as you pay the full balance as shown on each statement by the due date shown on that same statement, you won't incur a finance charge. Of course this only applies in the case of ordinary purchases that have a grace period.", "title": "" } ]	[ { "docid": "6cc787c66286e2c2fb1e5324f4a23d80", "text": "\"From my days in e-commerce they break down like this? The company doesn't know a debit from a credit card. Got the Visa logo, then it is a Visa through the company's payment gateway. The gateway talks to the bank and that is where the particulars for money is figured out. When I programmed gateway interfaces, I had the option to \"\"authorize\"\" or check for funds (which didn't reserve anything, just verified funds existed), run for batch (which put a hold on the funds and collected them at the end of the night) or just take the money. Most places did a verify during the early checkout stages and then did a batch at the end of the night. The nightly batch allows a merchant to cancel a transaction without getting charged a fee. The \"\"authorize\"\" doesn't mean the money is tied up, although that might be your banks policy. Furthermore, an authorize can only last for so many days. This also explains why most of your banks don't report your transactions to you the day of. There is a bunch more activity on your card than the transactions that complete.\"", "title": "" }, { "docid": "0858b1aa61813012c475ae93260a956e", "text": "All standard mortgage promissory notes mandate payments are due on the first of every month; I can almost guarantee the note you signed has this provision. Most lenders offer a grace period of generally 15 days before they assess a late charge, but the payment IS late on the 2nd. People have become incorrectly accustomed to believe that the payment is due between the 1st and 15th. If they are servicing your loan for another investor (FNMA, FHMLC, a private investor, etc.), they may have contractual requirements to begin collection activities by a certain date. So they are within the rights you granted them. If these calls really bug you, you can start to adjust your cashflow so you can perhaps make your payment a few days ahead of the first each month.", "title": "" }, { "docid": "b4585c86d5566947354fbb2697a2c873", "text": "You're knowingly providing a payment method which has insufficient funds to meet the terms of the contract, because you are too lazy to comply with the contract. That's unethical and fraudulent behavior. Will you get in trouble? I don't know. I'd suggest getting acquainted with an electronic calendar that can remind you to do things.", "title": "" }, { "docid": "cbb6ec7a1888247441acb6231540199b", "text": "\"Played \"\"the balance transfer game\"\" once recently, just as a reference - Got a balance transfer offer for a sock drawer no-AF card. 2% up-front fee, 0% APR. Grace period was, by the time I acted on it, about 16 months. Used it to pay down an auto loan with an APR slightly higher than 2%, and brought my equity back to positive. Towards the end when I rolled over the auto loan, thanks to the positive equity I was offered a rate discount on the new loan. Essentially this was a piggyback loan on the original auto loan funded by credit card (via balance transfer). Saved some interest charges without having to refinance.\"", "title": "" }, { "docid": "585f805eb52017a01668c8f337d46eb9", "text": "Remember that if you make charges as the starting of your billing cycle, then you are receiving a free ~60-day loan. For those that are able to receive high interest rates on their, this means a greater opportunity to earn on their money. For example: Your billing statement ends on Jan 5th. On Jan 6th, you max out your credit card. Your billing statement ends on Feb 5th. Depending on your credit card, your grace period can be anywhere from 20 to 30 days. If your bill is due Mar 7th, you just gave yourself a free 60 day loan. If you have multiple credit cards with different due dates and long grace periods, you can rotate which cards you max out to optimize the money you keep in savings.", "title": "" }, { "docid": "dd8c7409b7e8aa91eec22d0b56fdad7b", "text": "Each bank is different. Usually in my experience for newer credit card accounts, there is a specific number of days in a billing cycle (something like 28) and then a 20-25 day grace period. Older accounts usually have 30+ day billing cycles. Back in the 90's, many cards also had 30-40 day grace periods. The language specific to your card is in the card agreement.", "title": "" }, { "docid": "be5e92c9a470b50398820cd8544a10a2", "text": "It is the people who you bought the ticket from. Blocking is frequently done by hotels, gas stations, or rental car companies. Also, for anything where the credit card might be used to cover any damages or charges you might incur later as part of the transaction. In essence, they are reserving part of your credit limit, ostensibly to cover charges they reasonably expect you might incur. For example, when you start pumping gas using a credit card they may block out $100 to make sure you don't pump a full tank and your credit card is declined because you ran over your limit at $3. In general, the blocks clear fairly quickly after you settle up with the company on your final bill. You can also ask the company to clear the block, but I don't think they are required to by law in any specific time period. It may be up to their (and your) agreement with the credit card company. Normally it isn't an issue and you don't even notice this going on behind the scenes, but if you keep your credit card near its limit, or use a debit card it can lead to nasty surprises (e.g. they can make you overdraw your account). One more reason not to use debit cards. More information is available here on the Federal Trade Commission's website.", "title": "" }, { "docid": "9ab83502b801dfa3023ad27ef9d55d5d", "text": "It's my understanding that the grace period is only for filing - the actual procedure/purchase must be performed CY2011 to be paid out from the 2011 FSA money, etc.", "title": "" }, { "docid": "0fe8ad531b8303ea06ea6b21256025fe", "text": "I don't believe Saturday is a business day either. When I deposit a check at a bank's drive-in after 4pm Friday, the receipt tells me it will credit as if I deposited on Monday. If a business' computer doesn't adjust their billing to have a weekday due date, they are supposed to accept the payment on the next business day, else, as you discovered, a Sunday due date is really the prior Friday. In which case they may be running afoul of the rules that require X number of days from the time they mail a bill to the time it's due. The flip side to all of this, is to pick and choose your battles in life. Just pay the bill 2 days early. The interest on a few hundred dollars is a few cents per week. You save that by not using a stamp, just charge it on their site on the Friday. Keep in mind, you can be right, but their computer still dings you. So you call and spend your valuable time when ever the due date is over a weekend, getting an agent to reverse the late fee. The cost of 'right' is wasting ten minutes, which is worth far more than just avoiding the issue altogether. But - if you are in the US (you didn't give your country), we have regulations for everything. HR 627, aka The CARD act of 2009, offers - ‘‘(2) WEEKEND OR HOLIDAY DUE DATES.—If the payment due date for a credit card account under an open end consumer credit plan is a day on which the creditor does not receive or accept payments by mail (including weekends and holidays), the creditor may not treat a payment received on the next business day as late for any purpose.’’. So, if you really want to pursue this, you have the power of our illustrious congress on your side.", "title": "" }, { "docid": "e817c6ac14aee27f38a313a4b564c0ad", "text": "I'm pretty sure it's merchant-dependent. If a credit card transaction doesn't go through, PayPal will automatically charge your bank account. Some merchants may want that extra insurance.", "title": "" }, { "docid": "5decb6a6d267bdd7e47d67861b736515", "text": "The only card I've seen offer this on credit card purchases is Discover. I think they have a special deal with the stores so that the cash-over amount is not included in the percentage-fee the merchant pays. (The cash part shows up broken-out from the purchase amount on the statement--if this was purely something the store did on its own without some collaboration with Discover that would not happen). The first few times I've seen the offer, I assumed it would be treated like a cash-advance (high APR, immediate interest with no grace period, etc.), but it is not. It is treated like a purchase. You have no interest charge if you pay in full during the grace period, and no transaction fee. Now I very rarely go to the ATM. What is in it for Discover? They have a higher balance to charge you interest on if you ever fail to pay in full before the grace period. And Discover doesn't have any debit/pin option that I know of, so no concern of cannibalizing their other business. And happier customers. What is in it for the grocer? Happier customers, and they need to have the armored car come around less often and spend less time counting drawers internally.", "title": "" }, { "docid": "eea446cbb3ebab34ec08cdc4dd791dde", "text": "That would have been a good idea. They don't charge interest on a $0 balance, but if you payoff your account after the cycle date, there is a hidden balance and that balance will accrue interest. It is only a few cents a day. I just don't think it is legal for them to refuse to provide you a payoff quote mid cycle. I'm almost certain. When I worked for Discover it was a key point in training to not give the wrong amount and to make sure to use the calculator in the system to quote a daily balance, how much it goes up per day, and how much they should send if they were mailing the payment, giving consideration for the time it takes to receive/process the payment.", "title": "" }, { "docid": "8dec075513c05e6d972b7d6572bde1fe", "text": "\"AIUI this is not terribly abnormal. There are authorisations (sometimes reffered to as \"\"pending charges\"\" or \"\"holds\"\") and actual charges. An authorisation reserves money but doesn't actually take it. Normally what happens when you pay by card is that the merchant gets an authorisation immediately. Then some time later the authorisation is converted into an actual charge when the merchant takes the money. Sometimes merchants are slow in taking the actual charge, either deliberately (some merchants won't charge your card until they actually supply the goods to reduce the chance of having to process a refund) or because of administrative snarlups somewhere. When this happens the authorisation can time out before the actual charge is taken. So you get the pattern you see, first the authorisation appears then it times out and dissapears and finally the actual charge shows up.\"", "title": "" }, { "docid": "4e18a3c6cbff373b8ab0f583250150a6", "text": "A friend of mine has two credit cards. He has specifically arranged with the card issuers so that the billing cycles are 15 days out of sync. He uses whichever card has more recently ended its billing cycle, which gives him the longest possible time between purchase and the due date to avoid interest.", "title": "" }, { "docid": "d3e77b72b9352ad4d9199ede44d3730d", "text": "\"In short you have to wait till the hold expires. If its one week, its great. Few years back it was one Month. It is advisable you use a Credit Card for these type of transactions. With Credit Cards you are not out of funds like in Debit Cards. Plus the reversals are as much as I know automatic. In case of Debit Cards, the Holds are not automatically released on cancelled transactions but released only after expiry. Where as in Credit Cards, the holds are released immediately on cancelled transactions. \"\"Does the hold reserve it for them or for the original transaction?\"\" Yes hold is for that specific transaction from that specific merchant. i.e. if you try and book the same item from the same merchant, you will not be able to as you have money blocked. Although the merchant sends an unblock message when cancelling, on Debit cards these messages are not supported in India\"", "title": "" } ]	fiqa
112fbd2aad7d02b9394eeac5be5150b5	Applying student loan proceeds toward tuition?	[ { "docid": "6d89396a8694541c2527f1a4d4fea75d", "text": "Your university should have a finance department which can help with payments. Speak with them and tell them you have interest in paying for at least part of your next semester in cash. From here they should be able to tell you the best method for this, though most likely cash/check will suffice. If there is no finance department, or you are still unsure, check with student services for more information.", "title": "" } ]	[ { "docid": "e469fecddb9bac73a2d315a66af0ca53", "text": "\"There will be many who will judge your proposal on the idea that subsidized loans should be available to those who need them, and should not be used by others who are simply trying to profit from them. Each school has a pool of money available to offer for subsidized and unsubsidized loans. If they are giving you a subsidized loan, they cannot allocate it to someone else who needs it. Once you weigh the investment risks, I agree that it is analogous to investing rather than repaying your mortgage quickly. If you understand the risks, there's no reason why you shouldn't consider other options about what to do with the money. I am more risk averse, so I happen to prefer paying down the mortgage quickly after all other investment/savings goals have been met. Where you fit on that continuum will answer the question of whether or not it is a \"\"bad idea\"\".\"", "title": "" }, { "docid": "b3346a1b229db484ce324244ae755a29", "text": "There is no document that I know of that stipulates otherwise. This can also be corroborated by the fact that RESP withdrawals are considered as income in the name of the student. Thus, so long as the student pays tuition and receives a T2202A slip from the educational institution, they should be able to claim tuition, education, and textbook amounts.", "title": "" }, { "docid": "964ef441a36a8f3558d245c82db5bc45", "text": "It may have been the standard practice for a long time, and indeed it still is the common practice for my credit union to apply all excess payment directly to the principal. At the risk of sounding a little cynical, I will suggest that there is a profit motive in the move to not applying excess payments to principal unless directly instructed to do so. Interest accrued isn't reduced until the principal is reduced, so it benefits the creditor to both have the money in advance and to not apply it to the principal. You should probably move forward with the expectation that all of your creditors are adversarial even if only in a passive-aggressive manner.", "title": "" }, { "docid": "b8518ab561569554ce809f6be732522a", "text": "\"I haven't dealt with this kind of thing in any way, but I found some quotes from IRS publications which I think are relevant and hopefully help. Your scenario sounds to me like a Qualified Tuition Reduction as described in Publication 970 Tax Benefits for Education. It appears the rules are different for graduate study as opposed to pre-graduate work, though I don't see anything about any dollar amount limit. There are various requirements and exceptions, so hopefully reading through that section of the publication can help you understand whether the benefit is supposed to be taxable. If taxable, it should show up on your W-2 like any other income: Any tuition reduction that is taxable should be included as wages on your Form W-2, box 1. Report the amount from Form W-2, box 1, on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ). It doesn't appear that there is any special designation or box for the tuition reduction as opposed to \"\"normal\"\" work, it just is income that's been earned like any other. If you need guidance on how much of the income is for \"\"normal\"\" work and how much is for the tuition reduction, you probably need to see if you can figure it out from her pay stubs, or contact the university's HR department. Well, looking through the credits I see in Publication 970, there appear to be two possible credits: The \"\"American opportunity credit\"\" section, under \"\"No double benefit allowed\"\", says things like (my emphasis added): You can't do any of the following. ⋮ My understanding from reading through the section is that expenses are only excluded if they were tax-free, so that there can't be a double-dipping of benefits. If they're included as taxable income, I think they would count under your second interpretation, that the employer paid them like any other income, and your wife spent them as educational expenses just like other students, and they would qualify for educational credits. In fact, it explicitly states: Don't reduce qualified education expenses by amounts paid with funds the student receives as: Which sure sounds to me that anything that counts as W-2 Box 1 \"\"Wages\"\" would be payments received that then the expenses were logically paid separately from. The other credit, the \"\"Lifetime Learning Credit\"\", appears to use identical language (No double benefits; and don't reduce by wages). Obviously this is just from my looking through Publication 970; there may be more nuances here and for \"\"real\"\" advice you may want to speak more to the university HR department (who perhaps have dealt with this before) and/or a real tax advisor. You might also see if you can get any sort of a \"\"receipt\"\" or even a Form 1098-T from the university of what amount was paid on your wife's behalf, to help document it is truly that she was just paid more wages and spent them on classes as far as tax law is concerned.\"", "title": "" }, { "docid": "8125e139939bdcfbcaeb83f843bb2452", "text": "employed under the table and doesn't have a bank account If I could make that size 10,000,000 font I would. Your friend likely also isn't paying taxes. The student loan penalties will be nothing compared to what the IRS does to you. Avoid taking financial advice from that person.", "title": "" }, { "docid": "8700cf158da8042aaddd73f9043e4aef", "text": "\"This election only applies to payments that you make within 120 days of your having received loan money. These wouldn't be required payments, which is why they are called \"\"early\"\" payments. For example, let's say that you've just received $10,000 from your lender for a new loan. One month later, you pay $500 back. This election decides how that $500 will be applied. The first choice, \"\"Apply as Refund,\"\" means that you are essentially returning some of the money that you initially borrowed. It's like you never borrowed it. Instead of a $10,000 loan, it is now a $9,500 loan. The accrued interest will be recalculated for the new loan amount. The second choice, \"\"Apply as Payment,\"\" means that your payment will first be applied to any interest that has accrued, then applied to the principal. While you are in school, you don't need to make payments on student loans. However, interest is accruing from the day you get the money. This interest is simple interest, which means that the interest is only based on the loan principal; the interest is not compounding, and you are not paying interest on interest. After you leave school and your grace period expires, you enter repayment, and you have to start making payments. At this point, all the interest that has accrued from the time you first received the money until now is capitalized. This means that the interest is added to your loan principal, and interest will now be calculated on this new, larger amount. To avoid this, you can pay the interest as you go before it is capitalized, which will save you from having to pay even more interest later on. As to which method is better, just as they told you right on the form, the \"\"Apply as Refund\"\" method will save you the most money in the long run. However, as I said at the beginning, this election only applies if you make a payment within 120 days from receiving loan funds. Since you are already out of school and in repayment, I don't think it matters at all what you select here. For any students reading this and thinking about loans, I want to issue a warning. Student loans can ruin people later in life. If you truly feel that taking out a loan is the only way you'll be able to get the education you need, minimize these as much as possible. Borrow as little as possible, pay as much as you can as early as you can, and plan on knocking these out ASAP. Great Lakes has a few pages that discuss these topics:\"", "title": "" }, { "docid": "4b27fe4787eb6e07ed71131bc7357766", "text": "\"There are other good answers to the general point that the essence of what you're describing exists already, but I'd like to point out a separate flaw in your logic: Why add more complications so that \"\"should I call this principal or interest\"\" actually makes a difference? Why's the point (incentive) for this? The incentive is that using excess payments to credit payments due in the future rather than applying it to outstanding principal is more lucrative for the lender. Since it's more lucrative and there's no law against it most (all) lenders use it as the default setting.\"", "title": "" }, { "docid": "0a650c6cb599a5da5b1517644cefd71c", "text": "It's not a question with a single right answer. Other answers have addressed some aspects, my case may provide some guidance as to one way of looking at some of the issues. When I had student loans, the interest rate was RPI¹ and I could get more than that as the return on a savings account. At the time I could get a whole year's worth of loan at the start of the year, save it, and draw from the savings, partly because I had a little working capital saved already. Importantly in my case, the loans were use-it-or-lose-it: if I didn't take the loan out by about halfway through each academic year, it was no longer available to me. The difference in interest rates was probably similar to what you can get with a careful choice of savings account and 0% on the loan (I did this in the 90s when interest rates were higher). Over a four year degree the interest I earned this way added up to no more than about £100, which went someway towards offsetting the fact I would be paying interest after graduation. If you can clear the loan before you pay any interest it would give you a return, but a small one that could easily be eroded by rate changes or errors on your part (like not keeping on top of the paperwork). It still may be beneficial to take out the loans depending on your capital needs -- in my case it made buying a house after graduating much easier, as we still had money for the deposit (downpayment) and student loan rates were much lower than mortgage rates (100% mortgages were also available then, but expensive). ¹ RPI stands for retail price index, a measure of inflation.", "title": "" }, { "docid": "ad04daeb3d0cbecfa093e1702e2200b8", "text": "\"I was told if I moved my 401k into a Roth IRA that school purposes is one reasons you can withdraw money without having to pay a tax. Incorrect. You will need to pay tax on the amount converted, since a 401(k) is pre-tax and a Roth IRA is after-tax. It will be added to your regular income, so you will pay tax at your marginal tax rate. is there any hidden tax or fee at all for withdrawing money from a Roth IRA for educational purposes? You still will need to pay the tax on the amount converted, but you'll avoid the 10% penalty for early withdrawal. I know that tuition, books and fees are covered for educational purposes. Can I take out of my Roth IRA for living expenses while I'm attending school? Rent, gas, food, etc... Room and board, yes, so long as you are half-time, but not gas/food Possibly only room and board for staying on-campus, but I'm not certain, although I doubt you could call your normal house payment \"\"education expense\"\" with my 401k being smaller, would it just be better to go ahead and cash the whole thing and just pay the tax and use it for whatever I need it for? What is the tax if I just decide to cash the whole thing in? You pay your marginal tax rate PLUS a 10% penalty for early withdrawal. So no, this is probably not a wise move financially unless you're on the verge of bankruptcy or foreclosure (where distress costs are much higher then the 10% penalty) I can't answer the other questions regarding grants; I would talk to the financial aid department at your school. Bottom line, transferring your 401(k) is very likely a bad idea unless you can afford to pay the tax in cash (meaning without borrowing). My advice would be to leave your 401(k) alone (it's meant for retirement not for school or living expenses) Ideally, you should pay for as much as you can out of cash flow, and don't take out more student loans. That may mean taking fewer classes, getting another part time job, finding a different (cheaper) school, applying for more grants and scholarships, etc. I would not in ANY circumstance cash out your 401(k) to pay for school. You'll be much worse off in the long run, and there are much cheaper ways to get money.\"", "title": "" }, { "docid": "5e68a7f16bbbafd367c5aa932c0fa551", "text": "The short answer is that you can use student loans for living expenses. Joe provides a nice taxonomy of loans. I would just add that some loans are not only guaranteed, but also subsidized. Essentially the Government buys down the rate of the loan. The mechanics are that a financial aid package might consist of grants, work study (job), subsidized, and guaranteed loans. One can turn down one or more of the elements of the package. All will be limited in some form. The work study will have a maximum number of hours and generally has low pay. Many find better deals working in the businesses surrounding the college or starting their own services type business. The grants rarely cover the full cost of tuition and books. The loans will both be limited in amount. It mainly depends on what you qualify for, and generally speaking the lower the income the more aid one qualifies for. Now some students use all their grant, all their loan money and buy things that are not necessary. For example are you going to live in the $450/month dorm, or the new fancy apartments that are running $800/month? Are you going to use the student loan money to buy a car? Will it be a new BMW or a 8 year old Camary? I see this first hand as I live near a large university. The pubs are filled with college students, not working, but drinking and eating every night. Many of them drive very fancy cars. The most onerous example of this is students at the military academies. Attendees have their books and tuition completely paid for. They also receive a stipend, and more money can be earned over the summer. They also all qualify for a 35K student loan in their junior year. Just about every kid, takes this loan. Most of those use the money to buy a car. I know a young lady who did exactly that, and so did many of her friends. So kids with a starting pay of 45K also start life with a 35K. Buying a nice car in the military is especially silly as they cannot drive it while deployed and they are very likely to be deployed. At least, however, they are guaranteed a starting job with a nice starting pay, and upward potential. College kids who behave similarly might not have it as good. Will they even find work? Will the job have the ability to move up? How much security is in the job? One might say that this does not apply to engineers and such, but I am working with a fellow with a computer science degree who cannot find a job and has not worked in the past 6 months. This even though the market is super hot right now for computer engineers. So, in a word, be very careful what you borrow.", "title": "" }, { "docid": "6f8deb6271cb0f019346d6c648e11cd1", "text": "I think increasing funding to public colleges are an -okay- thing to do. Certainly it is better than the current system which guarantees student loans to benefit the bankers. So, we're talking about two different kinds of subsidies: one directly for schools and one for bankers. While ideally, I'd like to see no government involvement whatsoever, I can compromise as long as bankers are bearing the full risk of their student loans. The student loan system is what is bubbling up tuition prices, very similar to what happened in housing.", "title": "" }, { "docid": "3182d40a537f4e9791d6668c12f8c989", "text": "There are too many qualifying questions like martial status, dependent status, annual income, etc. Your answer is most likely in the Form Pub 970 you referenced: Adjustments to Qualified Education Expenses If you pay qualified education expenses with certain tax-free funds, you cannot claim a deduction for those amounts If the grant is tax free, you can not claim deductions up to that amount. Even if you were able to expense all the educational expenses you list, I doubt you can exceed the grant disbursement disbursement amount. I'm not a tax professional, so take my advice for what it is worth.", "title": "" }, { "docid": "2e92dac5806716153cdccea6b4a15c79", "text": "I would consult a tax professional for specific help. On my own research, I believe that you could. I know that when I made payments when I was in school for my undergraduate, I made payments on the interest. I believe that I was even told by my financial aid office that I could deduct the interest that I paid. I made not much money so I wasn't anywhere close to the MAGI >75k, but I believe you still could. Not only that but one other thing to consider is that if you have an unsubisidized loan, the interest still accrues when you are in school. In that case, it might be better to make at least some payments. It would save you from the total loan amount ballooning so much while you are in school.", "title": "" }, { "docid": "e634ebc5b8d5a558812184dc3afaf7cd", "text": "One way to reduce the monthly payment due each month is to do everything to eliminate one of the loans. Make the minimum payment to the others, but put everything into eliminating one of the loans. Of course this assumes that you have separate loans for each year of school. Make sure that in trying to get aggressive on the loan repayment that you don't neglect the saving for a down payment. Each dollar you can put down will save you money on the mortgage. It might also allow you to reduce the mortgage insurance payments. If you pay one student loan back aggressively but can't eliminate it you might be worse off because you spent your savings but it didn't help you qualify for the mortgage. One way to maximize the impact is to not make the extra payments until you are ready to apply for the mortgage. Ask the lender if you qualify with all the student loans, or if you need to eliminate one. If you don't need to eliminate a loan, then apply the extra funds to a larger down payment or pay points to reduce the interest rate.", "title": "" }, { "docid": "0ac0b0b64d309a1940fa5d71c715c966", "text": "Means A has a much higher level of interest payments dye to either higher debt or higher cost of debt (or combination of both). MM theory suggests higher debt in a capital structure due to the tax shield but you need to consider if A's debt level is appropriate or too high and what that says about your company.", "title": "" } ]	fiqa
e7fad579ec9f83aac432d70d6e1980b3	Non-EU student, living in Germany, working for a Swiss company - taxes?	[ { "docid": "f05fb26a8310550af2f484a24017dcea", "text": "\"I'll assume that you would work as a regular (part-time) employee. In this case, you are technically a Grenzgänger. You will need a specific kind of Swiss permit (\"\"Grenzgängerbewilligung\"\") allowing you to work in Switzerland. Your employer typically takes care of this - they have more experience than you. You being non-EU might make matters a bit more complicated. Your employer will withhold 4.5% of your gross income as source taxes (\"\"Quellensteuer\"\"). When you do your tax declaration, your entire income will be taxed in Germany, since this is where you live. This will happen after your first year of work. Be prepared for a large tax bill (or think of this as an interest-free loan from Germany to you). However, due to the Doppelbesteuerungsabkommen (DBA), the 4.5% you already paid to Switzerland will be deducted from the taxes you are due in Germany. Judging from my experience, the tax authorities in Germany are not fluent in the DBA - particularly in areas far away from the Swiss border. I had to gently remind them to deduct the source taxes, explicitly referring to the DBA. The bill was revised without problems, but I strongly recommend making sure that your source taxes are correctly deducted from your German tax liability. Once your local German tax office understands your situation, you will be asked to make quarterly prepayments, which will be calculated in a way to minimize your later overall tax liability. Budget for these. You didn't ask, but I'll tell you anyway: social security will normally be handled by Switzerland as the country of employment - not the country of residence. Your employer will automatically deduct old age, unemployment and accident insurance and contribute to a pension plan, all in Switzerland. However... ... if you do a lot of your work in Germany (>25%), which certainly applies if you plan on mostly working remotely, your social security will be handled by your country of residence. This is a major pain for your employer, because now your Swiss employer needs to understand the German social security system, how much and to whom to co-pay and so forth. This is a major area of study, and your employer may not want to spend all this effort. My employer has looked at this and requires anyone living outside of Switzerland to limit working from home to less than 25%, because by extension, they would some day also need to do the same for employees living in France, Italy, Austria... or even the UK. They don't want to dig through half the EU states' social security regulations. Therefore, you would not be able to work remotely from Germany for my employer. This is actually a fairly recent development that only entered in force at the beginning of 2015 (before that, this was all a bit of a gray area). Your prospective employer may not be aware of all details. So you will need to think about whether you actively want to point them at this (possibly ruining your plans of working remotely), or not (and possibly getting major problems and post-payments years later). Finally, I think you can choose whether you want to have your health insurance in Switzerland or in Germany (unless your Swiss obligation to be insured is waived because of your part-time status). Some Swiss health insurers offer plans where they cooperate with German health insurers, so you can go to German doctors just like a German resident. Source: I have been a Grenzgänger from Germany into Switzerland off and on for over ten years now. I can't say anything about whether your German visa restricts you from working in Switzerland. You may want to ask about this at Expatriates.SE, but I'd much rather ask your local German authorities than random strangers on the internet.\"", "title": "" }, { "docid": "ad545957f5af34e852059d84dd928377", "text": "\"Finally, I got response from finance center: \"\"It doesn't matter where do you study, what does matter is where you live. So, once you live in Germany, you pay taxes in Germany. And it doesn't matter who you work for.\"\" So, there are two options to pay taxes: it's paid by an employer or an employee: If I would work for Swiss company, I need to show how much money I make every month (or year) to Finance Center.\"", "title": "" } ]	[ { "docid": "866b5c9cc2f9d0044adca9577f629247", "text": "\"You'll need to read carefully the German laws on tax residency, in many European (and other) tax laws the loss of residency due to absence is conditioned on acquiring residency elsewhere. But in general, it is possible to use treaties and statuses so that you end up not being resident anywhere, but it doesn't mean that the income is no longer taxed. Generally every country taxes income sourced to it unless an exclusion applies, so if you can no longer apply the treaty due to not being a resident - you'll need to look for general exclusions in the tax law. I don't know how Germany taxes scholarships under the general rules, you'll have to check it. It is possible that they're not taxed. Many people try to raise the argument of \"\"I'm not a resident\"\" to avoid income taxes altogether on earnings on their work - this would not work. But with a special kind of income like scholarship, which may be exempt under the law, it may. Keep in mind, that the treaty has \"\"who is or was immediately before visiting a Contracting State a resident of the other Contracting State\"\" language in some relevant cases, so you may still apply it in the US even if no longer resident in Germany.\"", "title": "" }, { "docid": "47fbaf740dacac037b1f7a8f5dfa294b", "text": "This answer is assuming you're in the US, which apparently you're not. I doubt that the rules in the EU are significantly different, but I don't know for sure. In case of an IRS control, is it ok to say that I regularly connect remotely to work from home although in the work contract it says I must work at client's office? No. Are there any other ways I can prove that this deduction is valid? No. You can't prove something is valid when its not. You can only deduct home office expense if it is used exclusively for your business, and your bedroom obviously is not.", "title": "" }, { "docid": "6930ffd3459df51d2e594465b3b8a9f1", "text": "There's nothing wrong with your reasoning except that you expect the tax laws to make perfect sense. More often than not they don't. I suggest getting in touch with a professional tax preparer (preferably with a CPA or EA designation), who will be able to understand the issue, including the relevant portions of the French-US tax treaty, and explain it to you. You will probably also need to do some reporting in France, so get a professional advice from a French tax professional as well. So, in my tax return, can I say that I had no US revenue at all during this whole year? I doubt it.", "title": "" }, { "docid": "6bd9d272d2c1f443beb8f7f2851e50c7", "text": "\"(Selling apps is AFAIK business, not freelancing - unless the type of app you produce is considered a freelancing subject. The tax office will give you a questionnaire and then decide). As Einzelunternehmer, you can receive the payments for the apps to the same account where your wages go. However, there are lots of online accounts that do not cost fees, so consider to receive them on a separate account so you have the business and private kind of separate (for small Einzelunternehmer, there is no legal separation between business and private money - you have full liability with your private money for the business). The local chamber of commerce can tell you everything about setting up such a business, ask them (you'll probably have to become a member there anyways). They have information as well on VAT (Umsatzsteuer, USt) which you need to declare unless you get an exemption (probably possible), and about Gewerbesteuer (the income tax of the business) etc. For the tax, you have \"\"subforms\"\" for the income tax e.g. for wages and for business income, so you just submit both with the main form. You'll get an appropriate tax number when registering the business. Social security/insurance: as long as the app selling is only a side business, the social insurance payments for your main job completely cover the side job as well. You need to make sure that your employment contract is compatible with the app business, though. A quick search indicates that there is a tax treaty between Germany and the Ukraine, Wikipedia says there are no contracts about social insurance in effect (yet).\"", "title": "" }, { "docid": "dedd7c79745b9a261780a16dd3d00d32", "text": "\"Yeah but a lot of people wont see it that way. Most will read the headline Burger King to avoid US taxes and then wonder why BK isnt pulling their weight when they do business inside the US. Look at what happened when Walgreens tried this [Source](http://crooksandliars.com/2014/08/walgreens-wont-leave-usa-avoid-taxes) It didnt go over so well. Made them look unAmerican. I hate using that word but that is what it looks like.\"\"the bulletin reported that Walgreens has decided not to “invert” the company’s nationality to become a Swiss company\"\" I have no idea if this will happen to BK.\"", "title": "" }, { "docid": "cc041b18ffe6b806ba4fbcb0c963b9b0", "text": "\"The IRS taxes worldwide income of its citizens and green card holders. Generally, for those Americans genuinely living/working overseas the IRS takes the somewhat reasonable position of being in \"\"2nd place\"\" tax-wise. That is, you are expected to pay taxes in the country you are living in, and these taxes can reduce the tax you would have owed in the USA. Unfortunately, all of this has to be documented and tax returns are still required every year. Your European friends may find this quite surprising as I've heard, for instance, that France will not tax you if you go live and work in Germany. A foreign company operating in a foreign country under foreign law is not typically required to give you a W-2, 1099, or any of the forms you are used to. Indeed, you should be paying taxes in the place where you live and work, which is probably somewhat different than the USA. Keep all these records as they may be useful for your USA taxes as well. You are required to total up what you were paid in Euros and convert them to US$. This will go on the income section of a 1040. You should be paying taxes in the EU country where you live. You can also total those up and convert to US$. This may be useful for a foreign tax credit. If you are living in the EU long term, like over 330 days/year or you have your home and family there, then you might qualify for a very large exemption from your income for US tax purposes, called the Foreign Earned Income Exclusion. This is explained in IRS Publication 54. The purpose of this is primarily to avoid double taxation. FBAR is a serious thing. In past years, the FBAR form went to a Financial Crimes unit in Detroit, not the regular IRS address. Also, getting an extension to file taxes does not extend the deadline for the FBAR. Some rich people have paid multi-million dollar fines over FBAR and not paying taxes on foreign accounts. I've heard you can get a $10,000 FBAR penalty for inadvertent, non-willful violations so be sure to send those in and it goes up from there to $250k or half the value of the account, whichever is more. You also need to know about whether you need to do FATCA reporting with your 1040. There are indeed, a lot of obnoxious things you need to know about that came into existence over the years and are still on the law books -- because of the perpetual 'arms race' between the government and would be cheaters, non-payers and their advisors. http://www.irs.gov/publications/p54/ http://americansabroad.org/\"", "title": "" }, { "docid": "f358501a7f9abf6f372a1afd9f0f7be5", "text": "except that most companies are small companies and most business owners end up as families at some point. I'm starting a business abroad and will be taxed at 35% in the USA even if I don't live there. There's ways to get around it, but I'm not sure exactly how to do it yet nor am I making enough money yet to justify the up front expense of doing this", "title": "" }, { "docid": "8faf102c4cceb0254f9731411e2413c0", "text": "If the firm treats you as an employee then they are treated as having a place of business in the UK and therefore are obliged to operate PAYE on your behalf - this rule has applied to EU States since 2010 and the non-EU EEA members, including Switzerland, since 2012. If you are not an employee then your main options are: An umbrella company would basically bill the client on your behalf and pay you net of taxes and NI. You potentially take home a bit less than you would being 100% independent but it's a lot less hassle and potentially makes sense for a small contract.", "title": "" }, { "docid": "7b0a4c725928d63b3690d12d6b444b02", "text": "\"They did not do a corporate inversion. They mostly avoid paying taxes to European countries through setups that use two Irish companies, one Dutch (or Swiss, or Luxembourgian) and a Cayman Islands \"\"European\"\" headquarters office. They are still domiciled in the US and pay US taxes.\"", "title": "" }, { "docid": "b71efbb3f5044251b6e0a556fed686ed", "text": "\"If you haven't been a US resident (not citizen, different rules apply) at the time you sold the stock in Europe but it was inside the same tax year that you moved to the US, you might want to have a look at the \"\"Dual Status\"\" part in IRS publication 519.\"", "title": "" }, { "docid": "1c63acd0b8f3d76f9dd620dc9995123e", "text": "There are just too many variables here... Will you legally be considered a permanent resident from the moment you move? Will you work from home as a contractor or as an employee? Those are not questions you can answer yourself, they really depend on your circumstances and how the tax authorities will look at them. I strongly encourage you to speak to an advisor. Very generally spoken, at your place of residence you pay taxes for your worldwide income, at the place of your work base (which is not clear if this really would be Turkey) you pay taxes on the income generated there. If it's one and the same country, it's simple. If not, then theoretically you pay twice. However, most countries have double taxation treaties to avoid just that. This usually works so that the taxes paid abroad (in Turkey) would be deducted from your tax debt at your place of residence. But you might want to read the treaty to be sure how this would be in your specific case (all treaties are publicly available), and you should really consider speaking to a professional.", "title": "" }, { "docid": "e316d41336ca3bda6eb126bcc4115790", "text": "\"Can I use the foreign earned income exclusion in my situation? Only partially, since the days you spent in the US should be excluded. You'll have to prorate your exclusion limit, and only apply it to the income earned while not in the US. If not, how should I go about this to avoid being doubly taxed for 2014? The amounts you cannot exclude are taxable in the US, and you can use a portion of your Norwegian tax to offset the US tax liability. Use form 1116 for that. Form 1116 with form 2555 on the same return will require some arithmetic exercises, but there are worksheets for that in the instructions. In addition, US-Norwegian treaty may come into play, so check that out. It may help you reduce the tax liability in the US or claim credit on the US taxes in Norway. It seems that Norway has a bilateral tax treaty with the US, that, if I'm reading it correctly, seems to indicate that \"\"visiting researchers to universities\"\" (which really seems like I would qualify as) should not be taxed by either country for the duration of their stay. The relevant portion of the treaty is Article 16. Article 16(2)(b) allows you $5000 exemption for up to a year stay in the US for your salary from the Norwegian school. You will still be taxed in Norway. To claim the treaty benefit you need to attach form 8833 to your tax return, and deduct the appropriate amount on line 21 of your form 1040. However, since you're a US citizen, that article doesn't apply to you (See the \"\"savings clause\"\" in the Article 22). I didn't even give a thought to state taxes; those should only apply to income sourced from the state I lived in, right (AKA $0)? I don't know what State you were in, so hard to say, but yes - the State you were in is the one to tax you. Note that the tax treaty between Norway and the US is between Norway and the Federal government, and doesn't apply to States. So the income you earned while in the US will be taxable by the State you were at, and you'll need to file a \"\"non-resident\"\" return there (if that State has income taxes - not all do).\"", "title": "" }, { "docid": "d96a217cfd999cfcfdccb979a8068a15", "text": "\"Q) Will I have to submit the accounts for the Swiss Business even though Im not on the payroll - and the business makes hardly any profit each year. I can of course get our accounts each year - BUT - they will be in Swiss German! You will have to submit on your income from the business. The term \"\"partnership\"\" refers to a specific business entity type in the U.S. I'm not sure if you're using it the same way. In a partnership in the U.S. you pay income tax on your share of the partnership's income whether or not you actually receive income in your personal account. There's not enough information here to know if that applies in your case. (In the U.S., the partnership itself does not pay income tax - It is a \"\"disregarded entity\"\" for tax purposes, with the tax liability passed through to the partners as individuals.) Q) Will I need to have this translated!? Is there any format/procedure to this!? Will it have to be translated by my Swiss accountants? - and if so - which parts of the documentation need to be translated!? As regards language, you will file a tax return on a U.S. form presumably in English. You will not have to submit your account information on any other form, so the fact that your documentation is in German does not matter. The only exception that comes to mind is that you could potentially get audited (just like anyone else filing taxes in the U.S.) in which case you might need to produce your documentation. That situation is rare enough that I wouldn't worry about it though. I'm not sure if they'd take it in German or force you to get a translation. I was told that if I sell the business (and property) after I aquire a greencard - that I will be liable to 15% tax of the profit I'd made. I also understand that any tax paid (on selling) in Switzerland will be deducted from the 15%!? Q) Is this correct!? The long-term capital gains rate is 15% for most people. (At very high incomes it is 20%.) It sounds like you would qualify for long-term (held for greater than 1 year) capital gains in this case, although the details might matter. There is a foreign tax credit, but I'm not completely sure if it would apply in this case. (If forced to guess, I would say that it does.) If you search for \"\"foreign tax credit\"\" and \"\"IRS\"\" you should get to the information that you need pretty quickly. I will effectively have ALL the paperwork for this - as we'll need to do the same in Switzerland. But again, it will be in Swiss German. Q) Would this be a problem if its presented in Swiss German!? Even in this case you will not need to submit any of your paperwork to the IRS, unless you get audited. See earlier comments.\"", "title": "" }, { "docid": "328d9ea0fda297f04389a4d04d3ab323", "text": "It is unlikely that UK tax will be due on the money -- see here: Foreign students usually don’t pay UK tax on foreign income or gains, as long as they’re used for course fees or living costs But if the UK doesn't tax you on the money then double-taxation agreements probably won't apply, and so any Italian tax due will be payable.", "title": "" }, { "docid": "ca9f15b971066c655c369646ad1c9047", "text": "Some companies have banks and brokerages that are completely separate systems. So you could be actually running ACH transactions between two different banking entities. Bank of America used to have significant latency between BoA accounts, because they ran into delays integrating Fleet, BankSouth and BoA systems.", "title": "" } ]	fiqa

Subsets and Splits

No community queries yet

The top public SQL queries from the community will appear here once available.