Tag: saving tips

Disastrous myths about your credit score

Disastrous myths about your credit score

Contrary to popular belief, paying bills on time is an overrated part of your financial reputation.

People are obsessed with getting and keeping an excellent credit score. We hear these statements regularly on our financial helpline:

A caller who can’t pay their monthly bills because their debt payments are so high says, “I can’t go to credit counseling because I heard it will damage my credit score.”

A caller who is not saving in their 401(k) and missing out on the company match says, “I don’t want to pay off my credit cards. I am keeping a balance to help my credit score.”

This makes no financial sense. People aren’t going to seek help getting out of debt — lowering the interest rate and possibly the balance owed — because it will hurt their credit score? How is this helpful? If people don’t get their debt under control, they may never retire. We’ll have a nation of people working into their 80’s with no savings but they can all come together and brag about their credit scores.

Let’s examine some of the biggest credit myths that can lead to disaster:

Assuming if you pay your bills on time, you don’t have to do anything else. Paying your bills on time accounts for about 35% of your credit score but there is another 65% which includes amount owed (30%), length of credit history (15%), new credit (10%) and type of credit (10%). Consider all of the other factors.

Also remember that there may be errors on your credit report so if you don’t check it, you’ll never know and your score will be affected. According to Deborah McNaughton, author of The Get Out of Debt Kit, 80% of credit reports have errors (as cited by Bankrate.com). Many of the erroneous reports had missing information that may boost a score, such as missing a revolving account in good standing, or miscellaneous incorrect information such as an incorrect birthday.

Check your credit report. Credit reports are unique to Social Security numbers, so if you are married, you may want to stagger your requests with your spouse every six months. You can also request your actual score for a onetime fee (which is less than $15 through most credit bureaus). Most credit monitoring services will provide your score for free when you sign up for their service.

Assuming when you divorce, your accounts automatically divorce with you. They don’t. If you have a joint account and one of the parties on the account is late, you are both late. With some types of loans, such as a mortgage or a car loan, the lender may not accept a letter asking you to be removed from the account after a divorce even if that property is going to your ex-spouse. They will need to qualify for the loan on their own before you will be removed from the account.

Take this into consideration because if they don’t refinance, and then have late payments, you may find yourself with some credit issues. When possible, close all joint accounts and refinance any debt separately. If it is not possible, maintain some type of control, whether it is an escrow account or at least access to information to make sure the accounts are paid in a timely manner. Don’t assume. Also see the last point about closing accounts.

Avoiding consumer credit counseling because it will hurt your credit score. For someone with serious debt, working with a not-for-profit credit counseling agency to develop a debt reduction plan and get out of debt permanently should take priority over credit scores. Credit counselors will work with your creditors to try and reduce your monthly payments, or settle your debt altogether. Debt settlement doesn’t affect scores as badly as you would think. In fact, many people don’t realize that late payments affect scores more than a debt settlement. Here is an example of how a debt settlement can affect credit scores, and how that compares to late payments.

A late payment hurts your score more than a debt settlement if your score is in the 680 range; it only significantly pulls it down if you are in the 780 range. Let’s be honest here, people ready for credit counseling probably don’t have the highest scores anyways, and the bottom line is credit scores are fluid — they can be rebuilt. According to Credit.com, a debt write off can stay on your credit report from seven to ten years, but as the information ages, so does its negative impact.

Making late payments aren’t that big a deal. According to FICO, a 30-day late payment can affect your score by as much as 110 points. Late payments can have a huge impact on your credit score causing it to drop like a stone. This is one disaster that is relatively easy to avoid. Simply set up all of your accounts with an automated minimum payment schedule from your checking account. This way you’ll never miss a payment. You can always pay additional amounts through online banking. Set yourself up for success with this one because it can be an easy one to miss and makes a significant impact.

Closing accounts to clean up your credit. Closing an account may be a good idea if you only opened the account to get a discount on merchandise or have too many credit cards which is causing confusion, but it won’t clean up your credit or help your score. In fact, it can hurt your score when the account you close has a long credit history — especially a good one. Your credit history accounts for 15% of your score, so in making decisions which cards to keep and which ones to close, keep in mind how long you’ve had the account open and close the most recent ones first.

Are credit scores important? Yes, but they are not the “be all and end all.” Now that we’ve dispelled some of the biggest myths, consider what the “be all and end all” is for you. What are your biggest financial challenges and concerns? Our latest research shows that less than 18% of employees feel they are on track for retirement.

Are you part of the 82% that isn’t? Do you have a personal net worth statement and is it going in the right direction? The point is when you focus on the important financial issues, you have a chance to meet your financial goals. Clean up your credit if you have to, and do your best to keep a good credit score, but let’s not go overboard and lose sight of everything for just one number.

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Six red flags for your credit report

Six red flags for your credit report

You know bankruptcy and missed payments, but they can be just as bad.

You pay your bills on time and never miss a payment. If you’re still having problems with credit, something on your credit report could scare lenders.

Everyone knows the gremlins that haunt the major credit reports: items such as bankruptcies, foreclosures and payments, late or even missed. Less dramatic items can also cause some anxiety among lenders inconsistent.

When you apply for a loan or a card account, lenders review your credit score and pull your credit report. Or they can take this report and pump through one of their own rating systems.

If they do not like what they see, you may be rejected. Or you can get approved with less favorable conditions. And it’s not just new applicants who have run the gauntlet. Credit card issuers to periodically review the records of existing customers, too.

Even more confusing is that different lenders zero elements of the credit report. So it’s quite possible that even for the same loan, no two lenders will see your credit history, in exactly the same light.

Think there might be something hateful about hiding your credit report? Here are six items that could scare lenders.

1. Multiplying Lines of Credit

Opening a new map is normal. Opening three in a short period of time could signal something bad happens in your financial life.

When it comes to card issuers of credit, “the window auditing has shrunk,” said Norm Magnuson, vice president of public affairs for the Consumer Data Industry Association, the trade association of companies credit. “It used to be months and months. Now, you will find firms that monthly monitoring of account or every two months.”

And the only thing that these issuers do not want to see is that you ask all in town to lend you money.

“It would raise some questions,” he said. “This could be an indicator of something going on. I do not think it’s in the best interest of all consumers to go and be a collector of credit lines.”

2. A short-sale housing

“We told people short sales will not hurt their credit,” says Maxine Sweet, vice president of public education for Experian credit bureau. “But there is no such thing as a” short sale “in terms of how the sale is reported to us.”

“The way the account is closed is that it’s settled for a lesser amount than what you agreed to pay originally,” she said. “Status is” settled “. And it is just as negative as a foreclosure. ”

A tip: negotiating for the lender does not report the difference between your mortgage and what you paid as a “balance due” on your credit report, says John Ulzheimer, formerly of FICO, now president of consumer education for SmartCredit.com. Your credit score will take a heavy blow, but this action will not soften the blow, he said.

Sweet’s advice is not to dismiss the notion of a short sale, just go on with your eyes open.

“This may be the right decision to leave the house,” she said. It can be “better than a foreclosure in the economy, moving from the house and move on with your life. Do not expect to walk away with no impact on your credit history. ”

3. Someone Else’s Debt

Here’s something you might not know: When you co-sign on the dotted line to help someone else get a loan or card, the entire debt is on your credit report.

While the fact that you co-signed is neither good nor bad, it means – to the extent that any potential lenders are concerned – you of the debt yourself. And will be included in your existing debt burden when you apply for a mortgage, credit card or any other form of credit, said Ulzheimer.

And if the person you co-signed stopped paying, paying late or missing payments, that bad behavior is likely to go on your credit report.

So when someone tells you that co-signature is painless, because you never have to part with a penny, you can tell them that this is not true. Co-signing means accepting not only to repay the obligation, if necessary, but also to allow the debt – and all non-payment – as against you the next time you apply for credit you same.

Co-signing for a friend or family member “plays well with the Thanksgiving table, but it does not play well in the underwriting office,” said Ulzheimer.

4. Minimum Payments

If creditors make money when you carry a balance, the lenders who view your credit report does not like to see you pay just the minimum.

“It suggests that you are experiencing financial stress,” says Nessa Feddes, vice president and senior advisor for the American Bankers Association. “You can be delinquent,” she said.

Pay the minimums from time to time does not necessarily signal a problem, she said. For example, minimum pay in January, after holiday spending. Minimum one month or pay you expect your annual premium to reach.

But always pay the minimum after months months signals that you can not pay the full balance, and your current and future lenders will see that as a red giant “stop” sign when it comes to grant additional credit.

5. A Lot of Inquiries

This is similar to hiring a large number of new loans. When tightened lending standards, many borrowers, subprime borrowers in particular, had trouble getting credit, said Sweet. This meant they had to be applied several times to try to get what they wanted.

And with the VantageScore at least, that “really influenced the impact of investigations – they are more important than they used to be,” she said.

With the FICO score, the impact of investigations has remained about the same, according to Ulzheimer. Every time you allow a potential lender to pull your credit report, your score can take a small hit. The exact impact varies with the consumer, the score and the number of inquiries.

And if you apply for a mortgage, auto or student, you can minimize the damage by all applications within two weeks. When you do this, the beam score of all similar investigations and treats them as such. Unfortunately, there is no grace period for applications like credit card.

6. Cash Advances

“Cash advances, in many cases, provide the despair,” says Ulzheimer. “Either you have lost your job or are underemployed. Nobody comes out cash advances against a credit card because they want the money sitting in a bank somewhere.”

Because the interest rate is usually higher than the cost of credit card “, you are usually borrow from Peter to pay Paul,” he said.

How it hurts: first, the cash advance is immediately added to the balance of your debt, which lowers your available credit and can lower your credit score, says Ulzheimer. And all potential lenders will see your score.

Second, card issuers more regularly re-evaluate the behavior of their customers. To do this, they often get the credit report, the FICO score and history of the customer’s account and put these three ingredients through their own rating systems, said Ulzheimer. Many scoring models penalize for cash advances, which are often considered risky, he said. From your account history is only available to the issuer, only your behavior score with this card is likely to be affected, he said.

However, if the issuer slices of your line of credit or cancel your account, which could affect your credit score. And that could affect your relationship with other lenders.

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Discipline and self control methods on shopping

Discipline and self control methods on shopping

Saving and spending are the two most important elements of your life and your money. Unfortunately, money does not control many factors in life. It controls where you live, what foods you can buy, and many other things. For those who spend more than they earn, they can “look comfortable” but those looks can certainly be very misleading. We call these types of people “keep with the neighbors,” because they are deep in the debt and buy things that may be out of their price range so they can have as many cars as nice a house as his neighbor in the street. This can get you far in debt you may have to declare bankruptcy. Of course, this is not what the goal is.

Save your money, even if you are only 10 dollars an hour, it’s very doable. Ot just a small bit of your weekly income and put it in a savings account. A great way to make sure you save is to create an “allowance” that takes money directly from your paycheck or direct deposit and put it in the savings account and you never need to touch the money. Do not know what it is in the savings account. Some people literally can not save money is in their hands. The temptation is too great. Therefore the allocation of savings to the idea is great. Even if only $ 5 a week, saving something is the key here.

When it comes to spending money, you simply need to evaluate your budget. Of course, you want to subtract all your needs such as electricity, water payments, rent or mortgage payments to pay car loan, or credit card payments, and any other important projects of the total money available. You also have removed everything you put in savings and just pretend that this is not if you have never tried to touch him. Simple as that, you can skip all that is excluded from this number when you subtract your total cost of your total cash.

However, a great thing to do is to spend only what you need and maybe a few luxuries you can afford. If you have something left after spending some money, you can put in your savings account to accumulate leave. Some people have a hard time doing this, but it is very important. You can save this much more than you ever expected when you can just control your spending. It is obviously easier said than done, as many people spend every penny they have available, and a few cents, even they are not spending and borrowing from creditors and the interests of payable on these things and sometimes to pay 20 percent more than what you paid for it because of that interest.

Saving and spending are simple but what is really important is self-control and discipline. If you can control your spending and at least put some in savings and not to plunge into it, you are really great! You do not have to be rich. Sometimes being rich means being debt and buying things you can not afford. So you buy a smaller house, but at least you have money in your poche.

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How to build a credit score from scratch

How to build a credit score from scratch

These measures help young adults to prove they are accountable to the owners and lenders.

When it is time for a student to start building their credit profile? The answer is simple: when ready. You will know by how they budget their money, track expenses and manage their checking or savings and debit cards.

Building good credit is a function of managing your bills responsibly. No teenager or young adult should be in bulk with a credit card or given responsibility for a car loan until they have proven they can manage their cash flow. This means they must show that can deal with obligations without constantly ask the Bank of Dad for more money.

Your child may be ready to manage credit as a rookie, especially if you are willing to look over his shoulder. I prefer to send children to college with pre-paid housing, a checking account and debit card related that does not allow overdrafts. In this way, they have no large monthly bills and can get used to the convenience of plastic without much threat dinging their credit profile.

On the other hand, this approach does little to build good credit. Debit cards and checking accounts do not count for much in the context of the major credit bureaus. Therefore each student must take specific steps to start building a good credit profile. In the real world you want and need from a potential employer or the owner or the car dealer who sees your credit report to see that you are reliable.

Contrary to what many people believe, you do not start adult life with a higher credit score falls as you embezzlement debt. You start with a score around 600 (highest score is 850) and must build through a history of timely repayment of borrowed money.

My oldest daughter is entering her final year at university and for us it’s time to start working on their credit score. After an overview of Erik Larson, founder of NextAdvisor, a financial comparison site oriented, here’s how we approach it:

• Get a credit card. This is by far the quickest and most effective way to begin a credit profile. If I did not think my daughter was ready, I would find a prepaid card or warranty that the reports for the watchdogs of credit (it will say on the application, or just ask). Because she is ready, we’ll choose from credit cards are best suited for students.

• Use credit cards wisely. A credit card opens all sorts of ways to damage your score. Never miss a payment. Pay in full if you can. If you must carry a balance that will not hurt you unless your balance is relatively large. Never charge more than 30% of your credit limit and preferably keep it close to 10%. And do not apply for more than one card at a time or with any frequency.

• Get another form of credit. Having different types of debt helps your score. Thus, a car loan or personal loan or other installment credit can help. It can even help to have a second type, but different card, like a gas card or card store. In some cases, buy furniture or appliances can help conditions monthly. But you have to ask the finance company if they report to credit bureaus.

• Pay all bills on time. If you live off campus, to pay the cable bill or electricity bill or the monthly fee for a new office or on television is a must. It will not do much to build your score. But if you relax and get referred to a collection company is a major ding on your score.

• Do not close unused card account. It’s against-intuitive. Canceling a card can lower your score, because it leaves you with less credit overall, and instantly raises the percentage of the debt capacity you use. A long credit history is part of what makes for a high credit score. So keep those old accounts and ensure that they are in order.

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The dangers of using a debit card

The dangers of using a debit card

Consumers should be especially vigilant during the holiday season because identity thieves out en masse. Therefore it is essential that consumers keep their debit cards on the ice, “said Beth Givens, director of the Human Rights Chamber of privacy and exchange one of the foremost experts on the nation Protecting your private information confidential.

What makes debit cards so dangerous? Givens has so many reasons, his organization has developed a comprehensive information sheet if you must use cash, credit or debit card when you shop. (The report also explains the failure of gift cards.)

Here is the short version of the dangers of speed:

1. Limit Losses

Like credit cards, federal law limits your liability for fraudulent transactions on a debit card at $ 50. But only if you notify your financial institution within two days of discovery of theft. If you are a cadet of the space and do not check your bank statements for a couple of months, you could lose everything.

2. Pay Now / Reimburse Later

If someone has fraudulently used your credit card, you do not pay the fee. But when someone has fraudulently used your debit card, money is deducted directly from your account in real time. That means you’re out of money while the bank does have a quiet examination of their records to assess your application fraud. Many consumers complained to the Privacy Rights Clearing House have said they have lost access to their funds for several weeks. In the meantime, they have been caught short and unable to pay their bills, Givens said.

3. Merchant Disputes

The same problem affects merchant disputes. If you pay with a credit card when ordering something online, and that the product is damaged, broken or not at all, you can dispute the charge and stop payment by credit card. If you used your debit card, fees are paid when you order. When you find the goods were not what was announced, the merchant has your money and you are in the unenviable position of having to fight to get your money.

4. Phantom Expenses

If you use a credit card in a hotel, the hotel makes an impression when you register, but do not charge your card until you visit. It is a very different story with a debit card. Generally, the hotels put on hold “on funds in your account for more than you spend. Yes, more. They hold the entire amount of your stay, plus an estimated amount for “false”, such as meals at the hotel restaurant and diving into the mini-bar. This is not a real charge, the hold comes off your account at the end of your stay. But it affects the available balance in your checking account anyway and can lead to overdrafts. One consumer said that these accusations phantom cost him $ 140 in overdraft fees. These takeovers are usually placed on transactions made by debit card at hotels, service stations and car rental companies.

5. Overdrafts, Overdraft and Most Found

Overdraft charges have soared in recent years and the vast majority of consumers who pay to explain their discovery is the result of a transaction by debit card. Many consumers naively that if they have insufficient funds in their accounts, their bank would not approve a slip flow. But they were wrong. The result: a $ 4 coffee could trigger an overdraft fee of $ 35. Government regulators are reigning in these costs by requiring banks to give consumers the opportunity to “opt out” of overdraft protection automatically, but that does not begin to existing accounts until August. (If you have a new account, it starts in July.)

6. Skimming

Financial scammers have obtained sophisticated in recent years and that you use “skimming” machines to read your card information and charge your account, “said Givens. When your debit card is skimmed, your bank account can be drained before you know you’ve done.

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Spending cuts you might not even notice

Spending cuts you might not even notice

These tricks could raise your income or reduce expenses without affecting your quality of life.

It’s painfully clear Americans are still hurting financially. Jobless claims are far too high if we’re actually in any kind of meaningful recovery. Penalty withdrawals from 401(k) plans have been increasing, not shrinking. Mortgage rates are hitting 40-year lows with regularity and we still can’t find a pulse in the housing industry.

If there was a magic wand that would sharply raise incomes or reduce expenses, we’d be out there waving like mad. But that doesn’t mean there aren’t ways to cut and stretch. If you can afford it, give yourself some transition time to get used to spending cuts. Some will come at too steep a price in terms of your quality of life. But others may be painless, and you’ll never look back.

1. Know where your money goes.

This is Number One Obvious Idea that many people don’t follow. How can you possibly know how to save money if you don’t know what you spend it on? There are a growing number of online budgeting sites to help you. Use one, or do this yourself. Whatever you’ve been spending each month, try cutting it by 5 percent. Then cut it by another 5 percent the following month. Keep it up if you can, and put the savings in the bank or pay down debts.

2. Make a grocery list and don’t stray.

Once you’ve tracked household spending, you will see how much you spend at the supermarket. What’s less clear is that you also probably spend a lot of money on stuff you don’t need. In our house, we began downsizing our grocery spending by seeing what we were throwing out and the items that had freezer burn and should have been tossed. This helped sensitize us to unnecessary purchases. (My mom passed away nearly 30 years ago and I can still remember her hollering at me about wasting food.) We also save money by making fewer runs to the store. Our greatest savings come when we make a weekly meal plan, create a shopping list for that plan, and then buy nothing but what’s on that list.

3. Mothball a car.

If your household has two cars, try leaving one in the garage for a month. See how it affects your life. With a modest amount of planning, a lot of households might be able to make do with a single car. Once you’ve determined that you can do likewise, sell the second car, bank the money, and also begin enjoying lower bills for auto insurance, gasoline, and maintenance.

4. Try free phone service.

I’ve bought and used the MagicJack service, which is the most popular of its type. You order a small device — perhaps an inch and a half by three inches and about an inch thick — and it connects to your home computer. The software that launches when you connect the device provides easy-to-follow instructions. MagicJack also links from the computer to your existing phone set. So, you are making your phone calls over the Internet but using a regular telephone to do so.

I’ve found the audio quality higher than with products that require separate headphones and microphones. And picking up the phone is such a long-ingrained habit that there didn’t seem to be much to learn. You do need to get a new local phone number, which Magic Jack will provide at no extra charge. After the initial fee, there is no charge for domestic phone calls. This switch can easily save you hundreds of dollars a year. Think about keeping your existing phone line for a transition period in case MagicJack or a similar device doesn’t meet your needs. If you like the MagicJack and also have a cell phone, if could make sense to cancel your home land line and switch your home phone number to your cell. You’d lose your existing cell number but you’d at least be able to keep your old home number.

5. Trim television services.

Hey, I love my cable, and millions others love their satellite dishes. But if the times demanded, I would wave goodbye to a bundle of monthly cable charges. I’d also be in mourning during football season but I’d survive. I would install a digital antenna. And I’d begin making much heavier use of free online video sites that the networks and other providers offer.

6. Recheck insurance rates.

A year ago, I went out shopping to explore replacing all my insurance coverages. I wound up saving a bundle. When you’ve had your auto, home, life, and other insurance policies in place for several years, it’s easy to forget what I call “creepage” — those annual bump-ups in premiums. They really add up after a while. And while constantly rising health insurance rates may make it seem like premiums can only move in an upward direction, that’s not true. When you do shop around, you also may discover that your coverage needs have changed. If your cars are the same ones you had five years ago, for example, you probably don’t need as much collision insurance as you once did.

7. Forget about green; go brown!

The summer has been brutal where I live. But with dollars at stake, I am becoming very environmentally responsible. So what if even the goats pass by my yard?

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How to break your worst money habits

How to break your worst money habits

Using some simple rules and tools can help you save plenty over the long haul.

Break bad habits: The science of habit change

Does it really take just 21 days to change a habit? Experts say it’s not that simple. “Breaking bad habits successfully depends on your readiness to act,” says Heidi Beckman, clinical health psychologist at the University of Wisconsin Hospital and Clinics and speaker on financial behavior change.

John Ulzheimer, president of consumer education at SmartCredit.com, agrees. “If it was easy, we’d all have big savings accounts, and none of us would have credit card debt,” he says.

Beckman says habits change more quickly when you’re in the action stage versus the ambivalence or preparation stages that come before. To catapult yourself into action, she recommends using this three-step approach daily.

1. Create a positive picture in your mind of the result you want, and act as if the bad habit is gone. Use a negative picture of the current stressful result of the bad habit to push yourself further toward action.

2. Identify and focus on your positive financial habits, as proof you can do things the right way.

3. Create simple rules to fall back on when tempted, such as: “Don’t browse shopping websites until all my bills are paid this month.”

Break bad habits: Resist impulse buying

“We’re wired for instant gratification,” says Ulzheimer. “But if you can’t afford to pay cash and whip out a credit card without thinking, then you’re on a downward spiral into debt and money mismanagement.”

Using credit cards to spend more than the cash you have while making only the minimum payments on the cards can build up their balances faster than you can pay them, he says. And if you pay late, penalty fees just add to the total. “You forgo the many benefits of the proper use of plastic, such as for reimbursable business traveling, establishing a good debt utilization percentage on your credit report… and for earning easy cash-back rewards,” says Ulzheimer.

Practice telling yourself “no” when tempted to spend, and try these tactics.

• Distract yourself by making a phone call or unwrapping a stick of gum until the “buy” urge passes.

• Make a rule to only charge for reimbursable business expenses or rewards and only when you have the cash to pay for it during the grace period before the date interest is charged. Double-check dates.

• If you must take drastic measures to curb spending, have your credit card company lower your limit and opt out of over-limit and overdraft spending so your card gets declined.

Break bad habits: Automate finances

Counting on willpower alone is not enough. “When you rely on willpower to meet your expenses, important financial obligations such as timely payments and depositing to an emergency cash or retirement fund are left up to your personal choice and can easily be mismanaged,” says David Bach, author of “The Automatic Millionaire.”

Ulzheimer warns that some use the excuse of not being organized or not having enough money, but paying late just means you pay more because many companies tack on a late fee (typically $39) and many also charge you interest on the unpaid balance as well.

Says Bach: “Make your important payments automatic so bills get paid on time, and important savings deposits that protect you and your family don’t get missed.”

Make payments automatic to avoid late fees.

• Set up shadow payment dates by subtracting seven days from the real due date.

• Make payments automatic using your bank’s or the payee’s online bill pay.

Break bad habits: Pay more than the minimum

Paying just the minimum is a good way to stretch out your debts for as long as you can. “When you only pay the minimum amount due on a credit card, you’re effectively rolling over approximately 97 percent of the balance and adding the interest applied,” says Ulzheimer. This is very profitable for mortgage companies and card issuers, but not you. “The only way to reduce your balance quickly is to pay more than the minimum, avoid fees and stop adding to balances,” advises Ulzheimer.

Pay more than the minimum with every payment.

• Set up automatic timely payments of a higher amount than the minimum.

• For fastest results, create a “debt snowball,” in which you pay as much as you can toward the lowest-balance card until it is paid off. Then you apply that same payment amount plus the new payment amount to the card with the next-smallest balance.
• Consider taking advantage of the automatic biweekly mortgage payment plan your lender may offer. For the one-time fee, the quicker pay-down is worth many thousands of dollars over the life of the loan.

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Three steps to a great credit score

Three steps to a great credit score

1. Don’t close credit card accounts to improve your credit score.

You might have a good reason to shutter your account — you don’t want to pay an annual fee, you’re concerned about identity fraud, or you want to reduce the temptation to overspend — but don’t do it for the sole purpose of raising your credit score.

One factor in your credit score is your utilization, which is the ratio of balances owed compared to the credit limits on revolving accounts such as credit cards. Utilization is calculated for each credit card you have and across all of your cards. The lower your utilization, the better for your credit score. Closing a credit card account that has a zero balance excludes that credit limit from the overall utilization calculation, which can make your utilization increase and in turn, lower your score.

For the same reason, it’s also a bad idea to ask for lower credit limits on your credit cards if your goal is to improve your score. Doing so can only push your utilization higher.

Tip: If you must close a credit card account but want to keep your score high, pay down balances on other accounts to mitigate the effect.

2. Paying in full doesn’t hide a high credit card balance from your credit score.

If you’re consistently charging near the credit limit on your credit card but pay the balance in full when each bill arrives, you might be hurting your credit score. That’s because your score considers the account balance shown on your credit report. Your credit report will reflect the account balance at the time the issuer supplied it to the credit reporting agency, which will typically be the balance as of your last statement date.

Tip: If you pay in full each month but need to bump your score higher for an upcoming credit check, charge less on your credit cards.

3. Light use of credit cards is best for your credit score.

Maxing out your credit cards can obviously have a negative impact on your score. Using the majority of your credit limit is not good, either. Light use of your cards is best. Using 10 percent of your credit limit will be better than using 30 percent, which in turn is better than 50 percent. A small balance is actually slightly better than a zero balance (though it doesn’t matter to the score if you actually carry a balance).

Tip: If you need to raise your credit score, look at your monthly billing statements to see how your balances compare to your credit limits. Consider increasing your payments, or if you pay in full, using your credit cards less often.

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Black Friday becomes Black Week this year

Black Friday becomes Black Week this year

Retailers have turned the one-day bonanza into a week’s worth of hot sales.

…There may be just one Black Friday — the day after Thanksgiving — but retailers are offering deals pretty much every day this week. “It’s become Black Friday Week,” says Deborah Mitchell, executive director for the Center of Brand and Product Management at the University of Wisconsin-Madison. “Like Super Bowl Sunday, the main event is later in the week, but everyone is gearing up and excited now.” Not all the best discounts, however, are saved for the big day, and shoppers who stick to Black Friday may find they’ve missed out, she says. “Smart shoppers will be looking every day.”

The wider spread of sales throughout the week, both before and after Black Friday, has another advantage for shoppers. While stores typically suspend their price matching policies on Black Friday, most will meet a competitor’s advertised deal on other days this week. They may also offer a credit on an item recently purchased for the difference between the purchased price and new sale price, says Edgar Dworsky.

But there’s a catch, say retail experts. Many of the deals are blink-and-you’ll-miss-them opportunities which are available for a few hours, or until a limited supply runs out. Here’s what to look for each day now through Cyber Monday:

Tuesday

Many stores have already kicked off their Black Friday countdowns, offering one-day deals that come close to — or in some cases beat — their Friday prices, Mitchell says. Best Buy, for example, had a 55″ LG LED HDTV Monday for $898, a 31% discount and $100 cheaper than a planned Samsung door-buster for Black Friday of comparable quality. Amazon.com launched its Black Friday deals site Nov. 1, and has new offers each day this week. A number of stores, including Lowe’s and Home Depot, are promising that Black Friday prices are already in effect, Dworsky says.

Wednesday

Big pre-Black Friday sales, including those from Newegg.com and Target wrap up on Wednesday. Shoppers also may benefit from waiting until midnight, when many Thanksgiving online-only deals could go into effect, Dworsky says. Since most retailers have specified turkey-day deals, but haven’t offered details on availability, it may only be worth it if you’re already up late making the pies. “Last I checked, Nov. 24 still had 24 hours in it, so you could wait up for nothing,” he says.

Thursday

Shoppers stuffing the turkey at 6 a.m. may find their time waiting for the bird to roast well spent shopping. Kmart will be open from 6 a.m. until 9 p.m., and Best Buy plans to release a number of online-only sales that day. Gap Inc. plans to open 1,000 stores — including 800 Old Navy stores and a number of Gap and Banana Republic outlet stores — for limited hours on Thanksgiving. “We know from the receptiveness of Thanksgiving hours over the past two years that many consumers want the ability to jump-start their holiday shopping,” says Louise Callagy, a spokeswoman for Gap. She says Old Navy will offer 3D glasses for shoppers to spy hidden games, messages and extra discounts around the store.

On the later side, Toys R Us will open its doors for Black Friday at 9 p.m. on Thanksgiving, followed an hour later by Walmart. But leaving in time to get in line may require cutting Thanksgiving celebrations short. Mitchell suggests double-checking the ads to see which in-store-only deals (if any) are worth ditching the family.

Black Friday

More deals are rolling in at midnight this year, with retailers including Kohl’s, Target, Best Buy and Macy’s pushing forward the usual 5 a.m. store openings. Online shoppers will find plenty of deals at that time, too, with online-only deals and some of the same door-busters that are available in stores, says Andrew Eisner, the director of content for Retrevo.com. Despite waning interest from consumers, Black Friday is still one of the best days of the year to get bargains, he says. Anticipated deals include a $200 42″ Sharp LCD HDTV at Best Buy, and a $350 HP laptop at Office Depot. But shoppers must also contend with very limited quantities of those deeply discounted items, as well as some misleading sales on older items that aren’t the latest technology, Eisner says. Many of the sale Blu-ray players, for example, require shoppers to buy an extra WiFi adaptor, while laptops tend to have older, slower processors.

Shoppers have added incentive to keep their mobile phone on hand this year. Stores including Bon Ton, Macy’s and JC Penney have said they plan to have more mobile coupons available. Toys R Us announced last week that it will offer shoppers who check in on Foursquare special “swarm” deals including $50 off the $170 Imaginarium City train table and 40% off the Incredible Edibles toy line.

Saturday

Big-box stores will continue some of the same sales they offered on Friday, with a different round of door-busters. Given limited inventory this year, shoppers shouldn’t count on these items being in stock, says Dworsky. You may find deals on items that are less likely to sell out. Sears, for example, has a door-buster of 30% off Kenmore Elite appliances until 1 p.m. on Saturday as well as $200 off a broad range of Craftsman tool sets.

It may be worth browsing mom-and-pop shops, too. Many are participating in American Express’s “Small Business Saturday.” The card company is offering a $25 credit to shoppers who register their card and spend $25 at a small business that day. Plus, many stores are offering their own deals, including 20% off at McNally Jackson Books in New York and up to 25% off designer denim at AB Fits in San Francisco.

Sunday

Savvy shoppers should check out eBay in the early morning hours, says Tim Dubroy, a spokesman for eBay market data firm Terapeak. “We noticed a couple of years ago that sales are higher on the Sunday after Thanksgiving than on the Monday after,” he says. eBay sellers scanning Cyber Monday ads often price their items competitively. Last year, for example, a Dell Zino HD desktop sold for an average $340 on eBay on Sunday — $9 less than the Dell.com Cyber Monday price that several gadget blogs touted. Sellers also matched a $399 Amazon.com deal for a Panasonic Lumix DMC-G1 digital camera. For the best deals, bid or buy before 2 p.m. Eastern, when prices rise as more shoppers head online, Dubroy suggests.

Monday

“There’s been so little talk of Cyber Monday this year that you have to wonder if it even exists,” Dworsky says. The National Retail Federation reports that 45% of retailers plan to offer a coupon or percentage-off sale, about 38% will have a limited-time promotion and 30% will offer free shipping on some orders. (In comparison, last year 49% had special offers, 41% offered one-day sales and 22% had free shipping on all purchases.) Still, it’s worth browsing the sales, if not necessarily waiting for them, he says. AT&T plans to offer several smartphones — including the HTC Inspire and the LG Thrill — for a penny when consumers sign a two-year contract, similar to a deal Amazon.com has scheduled for Black Friday weekend. Clothing chain Express offers 30% off all online purchases plus free shipping, which is 10% less than its Thanksgiving and Black Friday morning in-store offers.

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Rising food prices you’ll feel the most

Rising food prices you'll feel the most

Expect to pay more for groceries these popular because of shortages in the world.

Prices are up in grocery stores across the country. You may not notice changes right away, that bread can be only one cent more expensive than last year. Soda that you buy may be the same price but it is now 1.5 liters instead of two. Many major cereal manufacturers such as General Mills, warned of impending price increases.

Why Grocery Prices Going Up ?

While nearly all grocery aisles is affected by rising prices, a large part of the reason all comes down to two commodities: wheat and corn. The two staples have been hit hard over the last two years – a combination of climate change, natural disasters and crop diseases. Russia experienced a severe drought for two years and had stopped completely wheat exports to ensure sufficient domestic supply. They resumed limited exports of July 2011, but supplies are still far away. A disease called Ug99 wheat rust destroyed crops across Africa and spread to other wheat producing countries at a rapid pace.

There was a lot of bad harvests corn in North America as well, but the real culprit for corn is that it is used to make ethanol, a fuel probably sustainable. Hundreds of thousands of acres that once grew corn for the people now grow it to fuel our cars.

At first glance it may seem that these increases does not mean you will pay more for a few grocery items such as bread and popcorn, but wheat and corn are included in the vast majority of food you can eat every day. Here are four areas where you will see higher prices.

Rising food prices you'll feel the most

1. Cereals, breads and pasta products

Most cereals are made from corn and they will be hit hard by price increases in the coming year. The commodity price of corn has nearly doubled since 2010 and is rising again due to the massive drought in Texas is facing. Bread, rolls, cakes and biscuits will all rise in prices of steep jump in the price of wheat. According to food manufacturers, the industry has been holding the increase in retail prices, but can not absorb the costs any longer.

2. Sweets

Most treaties “candy” soda biscuits with jam, are made with corn syrup, high fructose. The lack of corn supply is causing prices to increase in these areas regularly. Beware of packages decreases, as well. Many companies will keep the same price but lower the amount you get.

3. Beef, pork and chicken

Almost all industrialized meat fed with corn, mainly because it was the cheapest food available. As the price of corn increases, there is still no cheaper alternative, so the price of meat increases due to the rising price of entry.

4. Cat and Dog Food

Pet food contains grains in one of two ways: treatment of dry foods often contain corn as one of its primary ingredients and canned food contains pieces of meat or wheat-based thickeners. It’s not just the cost of food will rise.

Related Link: View more smart shopping advices

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