Contract Restrictions On Annuities Affect Them As An Investments Choice

Contract Restrictions On Annuities Affect Them As An Investments Choice

Annuities are insurance products. They're a contract between an insurer and an annuitant. But contracts inevitably imply restrictions on both parties. So, beware of restrictions that make annuities different from other investments.

The essence of an insurance product is that the insurance company guarantees a result. For life insurance the guarantee is the death benefit. For an annuity the guarantee is to pay an annuitant a monthly payment for the remainder of his life.

To 'insure' such guaranteed payouts, an insurance company must restrict how it invests its funds so they're assured of being there when needed for their clients. These restrictions must be consistent with the mortality statistics of its client base which is the basis of insurance products. A lot of insurance company investments include premium long term bonds for which it can safely project fund income over substantial periods.

Considering these points, the issue is 'in what ways do these restrictions as applied to annuities effect it as an investment by you as the client - i.e. a buyer?'

*Liquidity risk to you as the client:

The first effect is the liquidity risk that investing in an annuity presents. If you buy a deferred annuity, your contributions to it are relatively illiquid if you want to back out of the contract. That's because you face surrender penalties for cashing in your deferred annuity too soon. These penalties tend to 'lock' you into the investment for a number of years. So before you commit your money, consider if your situation allows you to be locked into an investment for some time.

Once you've annuitized (i.e. begin receiving your monthly payments) your annuity, you can't cash it in to your insurance company. So make sure an annuitization is the way to go for you.

*Accumulation phase time of your deferred annuity:

Insurance companies suffer extra cost to 'insure' their products compared to other types of investments. This reduces their comparative net returns on their own investments low risk investments are typically associated with lower returns. This, along with the penalty fees imposed on early withdrawals, means that you really need about 15 years in the accumulation phase to achieve significant compounding benefits of your annuity investment.

One benefit of an insurance product is that earnings grow tax-deferred. This can somewhat offsets their lower earnings compared to annually taxable investment types that have higher earnings.

*Contract clauses can restrict your investment flexibility:

Contract clauses may vary with the particular insurance product you buy. Therefore, be sure to understand what each clause means so you don't incur a restriction you wouldn't normally expect.

As an example, your product may have a clause that allows the insurance company to alter your product for non-payment of premiums. As a hypothetical example, the company may purchase a reduced paid-up annuity for you for non-payments. Would that be acceptable to you?

*Taxation of your payments:

If you purchased your annuity with after-tax payments, your annuitized payments will be taxed only one way. And that is that each payment will contain a taxable portion and a non taxable portion; the former comes from those tax-deferred earnings that your investment will earn over time, while the latter represents a return of your 'after taxed' contributions. Income from deferred annuities is taxed as ordinary income and withdrawals prior to age 59 1/2 are subject to a 10% penalty.

How To Choose The Best Options Trading Strategy

How To Choose The Best Options Trading Strategy

The magic behind options trading is that it permits for a number of options trading strategies to be used in conjunction with varied stock dealing philosophies. Even though, varied strategies are available, each of them has different levels of risk tolerance and profitability. Using a number of such strategies will increase the chances of succeeding in this market. Some of the strategies are discussed in the following paragraphs:

Position trading: Generally, when it comes to stock market, dealers have the habit of purchasing stocks of companies with good fundamentals and hold them for several months or even years together. They wait until the stocks get real good value as compared to what they paid for purchasing them. Once they find that the value is increasing, they will wait for other holders to make their move so that its value will further increase. This method will be helpful in earning more as compared what was actually paid for the purchase.

Momentum or trend trading: Once a stock has made a clear move, the role of momentum dealers will begin and these people generally look for short-term profits and they do not want to hold the stock for more than six months and they wait only for six weeks at the minimum level. The same technique can also be followed in trading options for getting profits from the options.

Swing trading: Under this method, the stocks are not held for more than 10 days by the dealer. Their minimum waiting time is two days. Under this method, the current trend of the stocks is analyzed by the dealers for earning profit.

Day trading: As the name suggests, purchase and sale of shares and stocks take place within a day. But, beginners are generally knocked out of this method as it is the requirement that the dealers should have at least $25000 for this method.

Before trading options, the first time dealer and even some of them, who has met several losses can just take up some coaching classes offered by professional companies. This type of coaching will be of great help to them to protect themselves from losses. Once the losses are avoided, they can slowly learn different options trading strategies one after the other by themselves once they get out of the fear of losses. Even some of these coaching providers are providing the opportunity for the dealers to understand how they are succeeding in the market.

Credit Unions Offer Several Perks and Benefits

Credit Unions Offer Several Perks and Benefits

When it comes to financial institutions, it sometimes seems as if the larger banks get all of the attention. Now, this isn't to say that they shouldn't be in the spotlight or that there is something particularly wrong with them. However, it should also be noted that credit unions are also essential and beneficial to their customers as well.

One of the things that make credit unions so great is the fact that they aren't as big as regular banks, for the most part. This may not be a plus for some, but for others having a smaller institution is right up their alley. This is especially true for people who love to build relationships with companies they will be conducting long-term business with.

Depending on where they live and which institution they choose, they may even become so familiar with the staff members that they come to know them on a first-name basis. This doesn't mean that everyone who chooses to go with credit unions will become best friends with their financial advisors, but they will have more of an opportunity to form closer relationships than they would at a regular bank.

Another great thing about these smaller institutions is the fact that they provide opportunities for people to form an affiliation with a business that represents one of their main interests. For example, many of these banks service people who are a part of certain groups or organizations. This includes teachers, military veterans, police officers and firemen, to name a few. Not only are some of these institutions formed in order to service these different groups, but many of them also provide different membership perks and benefits that can't really be found in many other places.

Lastly, credit unions don't necessarily consider their members to be customers. Instead, they see them and treat them as partners or shareholders. Because they are seen in this light, they are also treated a little differently. This doesn't mean that all regular banks mistreat their members, but the truth is that companies tend to hold their shareholders in a much higher regard than the average customer.

Of course, there are some people who aren't really interested in credit unions, even with all of the perks and advantages that come along with them and that's fine. However, there are those who love everything that these institutions have to offer. So, although some people may still choose to go with the larger banks, even they can admit that the smaller alternatives have a lot to offer as well.

Private Equity Investment: A Growing Trend

Private Equity Investment: A Growing Trend

Private Equity is a way by which companies can be owned and fresh capital can be raised for investment. Companies can be owned by the government, they can be owned by families or entrepreneurs. They may be listed on stock exchanges (Public companies) or, they can be equity firms. Like any other company, equities also may be small or large. Most equity investments are for small to medium enterprises (SMEs). Investment in equity is coming up as a great wealth management strategy for businesses and individuals with a high net worth.

Difference between public companies and private equity-backed companies:

  • Public companies have a huge number of small shareholders, while a private firm has a smaller number of huge shareholders.
  • Public companies give no authority to their shareholders in operations, while private companies give important roles I operations to their shareholders.
  • The shareholders of a public sector company may have different agendas. The private equity based company's stake holders' work with a common agenda.
  • Public companies cannot take swift decisions. Garnering support from large number of shareholders is slow and time consuming. On the other hand, equity companies can take quick decisions for the company, in lesser time and gain from them.
  • While public companies cannot bring about any management changes easily, private companies for equity can make fast management changes and benefit from them.
  • A public company is bound by numerous regulations and disclosure requirements, while an equity has lesser regulations and little disclosure rules.
  • Finally, public sector companies, with time seem less lucrative to their talented managers, who move to private firms for better avenues. Private equities attract talented managers as they usually offer much better compensations.

Advantages of investment in Private-equity backed firms:

  • There is a huge scope of investment for private equity. They can invest in new unlisted companies that are private startups or divisions of larger corporations or they can take over those listed companies that unappreciated by the stock markets. Private equities attract a lot of public sector companies that are hoping to go private.
  • Equity firms are highly selective and it is only after a lot of research and analysis, that they select they shortlist a company that has the right attributes to achieve growth.
  • The management of private equities is answerable to the shareholders. Shareholders can question the management for their performance and target deliverables. Also, these firms give access to each shareholder to get in touch with the top management if they feel the need to do so.
  • Looking at the fast developing and strengthening Indian economy, there seems to be very promising growth of firms in the near future. In order to make the best investment decisions, it is advisable to consult a wealth management company. A professional's advice can help one take profitable decisions after analyzing various investment opportunities available.

Disability Income Insurance for Doctors and Healthcare Professionals

Disability Income Insurance for Doctors and Healthcare Professionals

Disabilities are not just hereditary or accidental. Temporary disabilities happen to professionals all the time. Such disabilities may last for 90 days or more, and may prevent the effected people from making a living. Since most people depend on their monthly income for their everyday expenses, and do not have enough savings to last them over longer periods of time, a temporary disability can cause a lot of financial troubles. This is where disability income insurance comes in.

Some of the major types of temporary disabilities are malignant tumors, mental disorders, disability caused by substance abuse, damage to the nervous system, problems in the heart and circulatory system, problems with the digestive system, and musculoskeletal injuries. Doctors and healthcare professionals are exposed to the risk of such disabilities, and need financial support to protect their income. If a doctor or a healthcare professional is unable to work for a few months, due to a disability, disability income insurance can help take care of their financial losses.

Disability income insurance for doctors and healthcare professionals is just as necessary as a retirement fund or a life insurance policy. Through life insurance policies, one ensures financial safety for his or her beneficiaries in case of his or her premature death. However, financial safety is also required for times when a disability prevents one from working and making a living.

They say the most important financial asset of a person is their ability to earn a living. Through disability income insurance, medical professionals ensure a consistent stream of income for themselves and their families in times of need.

Healthcare professionals spend too much time and money on their education. Although doctors and other healthcare professionals are financially comfortable (depending on how the practice is going), but a disability can change that in a couple of months. Considering expenses such as utility bills, mortgage payments, credit card bills, insurance payments, and children's education, a steady stream of a healthy amount of income is needed to avoid debt. After investing so much on their education, most doctors already have student loans to pay off. They cannot risk being unable to work, and therefore use disability income insurance.

Apart from disabilities caused by disease, disability income insurance for doctors also comes in handy in case of an accident. It is a common perception that construction workers and professional drivers should be covered by disability income insurance, because of the high risk nature of their jobs. However, doctors and healthcare professionals, along with people from many other professions, are also getting insurance for disabilities.

If you are a doctor or a healthcare professional, and are giving serious thought to disability income insurance, we recommend you compare key features of different policies in the market. You should read the definition of disability thoroughly because that can make all the difference. You should also know the beginning date (the amount of time you remain disabled until you finally start receiving the benefits), and should know the exact benefit period before you sign anything.

The Benefits of Banks and Their Services

The Benefits of Banks and Their Services

Banks are financial institutions that deal with many different forms of money, finances and investments. Basically, the institution handles transactions that deal primarily with money that its depositors and investors have placed in it. Since there are many different kinds of investments, deposits and dealings that go through it every day, the officials who manage these places usually have rules and stipulations that they adhere to in order to avoid any problems. These institutions have a variety of services that they usually offer their clients in order to make their lives and transactions easier, as well as to be able to turn some profit in the process.

Services
The different services that are offered to clients include, but are not limited to, handling deposits, issuance of checks, trading, credit cards, Internet and phone banking, and foreign exchange. These are the more common things that one might come across when dealing with financial institutions. When clients open a savings account with the financial institution, they are assured of interest for the duration that they leave their deposits in the account. The rate of the interest is dependent on what the banks have to offer, and what kind of account the client has opened. The deposits are also insured for specific amounts, which differs according to each institution. The issuance of drafts or checks is also another service that they extend to their clients. These checks are as good as cash, because the client can issue them to anyone with the backing of the institution as long as there is still a similar amount in the account. Trading is also another thing that many clients are interested in. Many of these places offer trading with stocks and bonds for their clients in order to get bigger returns. Most of the transactions that deal with trading are profitable, but there are also some instances when the trader who handles the account may not acquire the desired results. The issuance of credit cards is another service that banks offer their investors and clients. The person who has been handed these in lieu of cash transactions can use these credit cards. Most of the stores and companies that sell services and products accept payments made through this medium. Internet and phone banking are ways to access one's account via another medium, which does not require the client or investor to go to the bank personally. These services are usually complimentary from the bank to give their client a lot of leeway with the handling of payments and finances. Banks also handle the foreign exchange of the monies between different countries.

The benefits of dealing with bank usually come with the security that they offer their clients in terms of insurance for deposits, as well as the know how when it comes to foreign exchange and investments. It is also easier to get a loan from banks if one has an account in it.

VA Streamline Refinance Explained: Understand The Facts

VA Streamline Refinance Explained: Understand The Facts

Veterans and military personnel have the best financing opportunity in the VA loan refinance options. New VA refinance loans are offered to all veterans with VA mortgage loans at reduced rates. In terms of description, such a refinance option is available for current holders of a VA mortgage, helping them to receive lower interest rates with minimum or no out of pocket costs. Though the loan can only be obtained by veterans or active military personnel who have used their eligibility to VA in the purchase of their initial homes, refinance can easily be accomplished and accords beneficiaries the opportunity to save massively on their mortgage.

VA refinancing streamline program is also called IRRRL (interest-rate reduction refinancing loan) program because it dwells greatly on ensuring that the existing VA mortgage is refinanced into the new VA loan with a big interest rate reduction. Alternatively, those who have adjustable rate mortgage loans can replace them with fixed rate loans. However, it is on the qualifications that many may face some hurdles.

Individuals will only be eligible for VA IRRRL if they are eligible for lower interest rate loans or adjustable rate mortgage loans. IRRRL guidelines stipulate that individuals should either have fixed rate loans that they intend to refinance to lower rates or adjustable rate mortgage (ARM) loans to refinance to fixed rates, if their rates cannot be lowered in order to qualify for VA refinancing loans.

Must your refinance VA lender be your present lender?

Certainly not! There are several VA approved lenders to consider. So it is upon the borrower to shop around thoroughly for the most appropriate VA refinancing provider. By looking through offers provided by many lenders, you will have the opportunity to select the most appropriate loan terms for your situation. Be very cautious with a lender who tries to persuade you into thinking that there are few lenders. The VA approved list of lenders is quite long!

What should you look for in your VA lender?

When running through the long list of VA options, check for low lending fees. You want to take complete advantage of the IRRRL reduced rates and should therefore avoid any high lending fees. You should also consider offers that have no origination fees. Any lender asking you to pay origination fees should be ignored with deserved urgency.

VA does not require going through appraisal process or credit checks again during refinancing. As long as your initial mortgage was approved, you will remain eligible for VA refinancing. However, lenders will still carry out credit checks to be sure that there are no mortgage delinquencies or any new judgments which may exclude you from VA streamline refinance eligibility. Nonetheless, no additional eligibility certificate proofs will be required. You should also understand that there are no further fees charged during a VA, except the nominal funding fees of new loan. Individuals who are 10% disabled or more, are exempted from VA funding fees.

What are the benefits of such refinancing?

Omission of standard underwriting processes ensures that the borrower does not bother with bank statements, job verification, W2s and pay checks. The opportunities to skip two monthly payments and to receive the previous loan escrow account balances from the past lenders are noteworthy advantages. Besides, VA refinance allows individuals to finance energy saving home improvements into the new loan.

Traveling Abroad - Here Are Some Tips To Make Your Money Go Farther

Traveling Abroad - Here Are Some Tips To Make Your Money Go Farther

One of the nice things about retirement is that you have the time to travel to those places you've dreamt of. And, hopefully, you've the money to get you there and back. Nevertheless, here are some tips to help make those travel dollars go farther.

-Off-season savings:

Not having to stick to your kids' vacation schedule, you can travel anytime. So you can avoid traveling during the expensive 'tourist' season. Airlines, hotels, and resorts base their prices on demand. Choose to travel 'off season' and save money.

-Airline ticket savings:

* Make your travel arrangements well in advance. Checkout the discount websites (Google 'cheap flights') for good deals. They often combine flight segments from different airlines for even lower costs.

* Always check out the round trip option to any flight you make - even if you don't intend to return using it; round trip tickets are often cheaper than the one-way ticket.

* Using connecting flights - rather than direct flights- can help you save money. Forget about the inconvenience. Remember, you're not in a rush. Make it work for you.

-Ground transportation savings:

* Some insurance and many credit cards have automatic car rental coverage for whenever you rent a car. You just have to pay with the credit card to be insured. Check yours. If so, be sure to decline the coverage the rental company's offers you - for more money.

* If you'll be traveling a lot in Europe by rail or metros, check on any multi-trip discounts. Many have passes such as a 3-day unlimited travel pass that can be a cheaper option.

* For long train rides between cities, consider taking a night train. Sleeping on the train not only saves you the cost of a hotel night, but frees up a day for sightseeing.

-Eating savings:

* Don't eat breakfast at your hotel. It's always expensive. Find an inexpensive local café and enjoy the local ambience.

* Stop into the local supermarket or grocery store to pick up snacks and fruits. Munch on those through the day. It's cheaper and healthier than expensive breaks at cafes.

* Choose one meal as your 'eating out' meal at a restaurant. Choosing it as a very early dinner or lunch, you'll save even more. Sample the local beer; it's often cheaper.

-Accommodation savings:

Always ask for discounts. But often you can choose to stay in a small town outside the city you'll visit. Small town hotels can offer a cheap alternative. Then use your rental care or the local transportation to travel to the big city.

-Entertainment savings:

Avoid the tourist traps; they're always more expensive. Go to a local pub to better observe the life and savings.

Improve Credit Scores And Reduce Household Expenses With These Six Ideas

Improve Credit Scores And Reduce Household Expenses With These Six Ideas

It's always wise to review your household financial strategy from time to time to see if there are any areas where you can not only reduce your ongoing expenses but ultimately improve your credit score. And we all know how credit scores are now tied to all kinds of things - from the interest rate on personal loans to your insurance premiums.

Here are six suggestions that can make handling household finances easier right now.

1. Know the "score."

Everyone has the right to a free credit report annually. Some banks do provide clients with a free credit report, but you can also obtain one online. Review each trade line on the report for accuracy. Look for any negative listings. Investigate any collections, late pays, or unfamiliar items. Dispute or explain any erroneous reporting by writing to the credit bureau. And make sure you keep copies.

2. Review important bank and monthly statements

Check statements for errors, including unnecessary bank fees. Do so regularly and do it soon. The more time that passes, the harder it is to rectify an error. At a certain point, research may have a cost, or information may no longer be available. Some providers will not waive fees for errors found after 60 or 90 days.

3. Enroll in a bank's automatic online payment service or use a third party service

Making timely payments is important in maintaining a good credit score. Technology now makes paying bills online efficient. The majority of banks and third party providers will make those payments at no charge, and most bill payment platforms integrate into financial software, such as Quicken or Mint.com. Securely enroll utility, car and mortgage payments online now.

4. Swap retail cards for one debit card

Most retail credit cards carry very high rates of interest and can only be used at the corresponding store. And carrying a credit card balance with high interest is a waste of money. While it can be difficult to go "cold turkey" by cutting up every credit card, start by replacing minor gas and retail cards with one debit card. Keep in mind that retail credit cards are not useful in a financial emergency either.

5. Account for your past year's monthly mortgage payments

Compare the interest paid on your mortgage for the previous year to the amount the lender reports on tax form 1098. As a loan amortizes, the interest paid per year should decrease in comparison to the amount going towards principal. Use an online amortization calculator to doublecheck what the bank reports and what you have actually paid. Also every year, your 1098 should state the amount of principal left on your mortgage. If not, contact the lender immediately. If there is no response, contact the state agency that regulates mortgage lenders.

6. Reduce unnecessary expenses

Review monthly expenses and determine what changes can be made. Cable and cell phone plans are a good place to start. View favorite shows without cost on a network website. Instead of buying books or movies, borrow them from the local library. Many libraries now even have free online lending. Cancel magazine subscriptions and read the library's periodicals. Reconsider gym dues and sell unused home gym equipment. Even YouTube has free exercise videos. Many communities also offer exercise programs at no cost. So become physically fit while getting fiscally fit.

Implementing some of these suggestions may take discipline. They will, however, be worth the effort when you see the savings.

Your Financial Education

Your Financial Education

I am sure of the fact that many people are unfulfilled in their lives, particularly with their jobs, relationships and financial status. Today I want to discuss a very important issue- and I believe that many people will agree with me. I will start with this question: With the way the economy has turned,what do you think is the solution to financial lack?

Not many people have the guts or even the patience to learn about money. Human beings are creatures of habit and if one is happy with just going about their usual routine - though it may always bring them disappointment- then that is what that person will do until something so drastic happens that forces them to finally take action. Even if you do not become a big business owner, why not invest your money as opposed to saving it in the traditional way?

Financial education is, undoubtedly the most crucial element of education every person needs in this world to enjoy life. I am terrified of people who have the 'its fine to have just enough' mentality because we all know that having just enough means being able to pay your bills then hoping someone helps you get by along the month. Have you ever heard someone tell you they have more month than money? Unfortunately, for millions, the world over, that is the average person's cry. It is sad really, that we choose to use outdated strategies that were used up to five decades ago that will not only disappoint us but will see us living in abject poverty during our retirement years.

I have made it a mission to educate myself financially for my well-being. I find that it is especially important for women to learn about making and managing money because too often women rely on their counterparts for support and are often disappointed. Decide today what you want in future and plan for it meticulously. Attend seminars, read books, seek out mentors and most importantly, stay focused because if you sell your dream to someone else you will be miserable for the rest of your life. Oh, and love does NOT pay the bills!

For women, I suggest you read 'Rich Woman' by Kim Kiyosaki and 'Rich Dad's Guide To Investing' by Robert T. Kiyosaki. Have a splendid day and remember to put your financial education above all else because then you can have a firm foundation to do anything that you want.

Student Prepaid Debit Cards Rise in Popularity

Student Prepaid Debit Cards Rise in Popularity

For years credit card companies and banks were allowed to market their credit cards to students on college campuses. The Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD Act) changed the rules. The regulations were implemented to help prevent these companies from contributing to student credit card debt.

Today, a college student won't find banks enticing them to use their high-interest credit cards to rack up thousands of dollars of debt. Instead, colleges are working with prepaid card providers to offer student prepaid debit cards that drastically reduce the possibility of incurring a large amount of debt. Student prepaid cards can also double as school ID cards with two strips on the back to make them even more versatile.

The Basics of Prepaid Debit Cards for Students
A student prepaid card isn't tied to a bank account or line of credit, and can be used anywhere Visa and MasterCard are accepted. Students can only access the money placed on the card, and they aren't charged interest for their purchases.

Prepaid debit cards continue to rise in popularity. In fact, 2011 saw an 11 percent increase in consumer usage over the previous year. This is largely due to the fact that more and more consumers are growing tired of the rising fees of traditional checking accounts, and are also avoiding the pitfalls of credit card debt. With some fees hitting a high of 21 percent at financial institutions where it can be difficult for consumers to obtain an account in the first place, prepaid debit cards-including student prepaid debit cards-are an ideal solution.

Why Prepaid Debit Cards for Students?
Student prepaid debit cards offer students and higher education institutions many benefits. They may double as ID cards students use to gain access to campus buildings, in addition to being used to pay for purchases on and off campus. They provide financial and facility security, and financial aid disbursements can be easily received.

Advantages of Student Prepaid Debit Cards
Prepaid cards offer colleges, students, and parents many benefits:
• The amount of money on a prepaid card is determined by how much has been already deposited on the card-not available credit. While there are background checks, students are not turned down if they have some credit issues.
• Students don't risk damaging their credit score, which can make it more difficult to obtain loans and credit in the future.
• Student prepaid debit cards can be used everywhere MasterCard and Visa are accepted, including both online and in-store purchases.
• Students can learn essential money management skills. Since a prepaid card doesn't allow a student to spend more than what is deposited, there is virtually no risk of overspending. Parents have an easy way to promote their students' financial responsibility.
• Students can pay bills with their prepaid cards and withdraw cash from ATMs on and off campus.
• Parents can add allowances to the student prepaid debit card for safer spending compared to cash. Student loan payments can also be automatically distributed directly from the card for tuition, fees, books, and other student items.
• Prepaid cards reduce the risks of identity theft since their cards are not linked to lines of credit or bank accounts.

Student prepaid debit cards help reduce debt, save time and money, and improve security on campus. Learn more about the advantages of using a CampusCard by visiting the prepaid debit card experts at CardFlex.

Can Your Business Bank on ACH Payment Processing?

Can Your Business Bank on ACH Payment Processing?

Businesses rely on security electronically and physically. The days of paper checks and cash almost seem archaic for businesses, especially when it comes to paying the bills. ACH or Automated Clearing House is a highly sophisticated network of financial transactions between vendors, financial institutions, banks, and businesses. ACH is responsible for processing large volume payments, including payroll.

How ACH Payment Processing Works
ACH works on a transaction-by-transaction basis. It starts when a receiver authorizes an ACH debit on a bank account or credit line. The receiver is the account holder who grants access by ACH. The originator is the company requesting the funds, such as a business vendor or supplier. The receiver must provide prior authorization in order for ACH to process forthcoming transactions, which can be written or electronic. Once authorization is received, the payment is issued to the originator. Although it sounds like a long, drawn out process, an ACH transaction is typically accomplished in the same time as a credit card transaction.

Different Uses of the ACH System
There are a variety of uses for ACH payment processing, including:
• Business-to-government payments
• Business-to-business payments
• Direct debit of a customer's account (e.g., mortgage payments, utility payments, rents, etc.)
• Direct deposit to a customer's account (e.g., payroll, government payments, tax refunds, etc.)
• eCommerce payments
• Federal, state, and other local tax payments or refunds

Benefits of ACH Payment Processing
Employers, employees, businesses and their clients all benefit from the use of ACH. This batch-based process is inexpensive, faster, and more secure than any other type of electronic payment service available today. And, of course, it is far more safe and environmentally-friendly than processing paper checks. ACH payment processing has numerous advantages:

• Security: Approximately nine million Americans fall victim to identity theft on an annual basis, according to the FTC. Unfortunately, 85 percent of these thefts are the direct result of identity thieves obtaining critical data from bank statements, paper checks, and credit card bills. ACH transactions are 100 percent electronic, so there are no paper forms or statements processed for identity thieves to access.

• Fund access: When employers pay via paper check, employees have to take the time to deposit the check and then wait the specified time for the check to clear. This can mean an employee must wait three to five business days to access his paycheck. ACH payment processing, on the other hand, makes funds immediately accessible after they are deposited into an employee's account.

• Convenience: Business owners who have recurring payments can set up an automatic account with an ACH provider. That provider can then automatically make payments on the business's behalf for vendor payments, retail payments, service agreements, utility bills, and salary payments to employees, thus reducing the amount of time spent each month on accounts payable.

• Cost-effective: The biggest benefit of ACH, aside from security, is that it is cost-effective for businesses. Although ACH has associated fees, the costs associated with accepting credit cards and creating, purchasing, and using paper checks costs a business considerably more-especially when a business factors in the cost of man hours spent on accounting and paper check management.

It's no wonder that ACH is the preferred payment method for companies of all types and sizes. Learn more about the benefits of ACH payment processing for your business by visiting merchant payment processing experts.

Capital One Bank

Capital One Bank

Capital One Bank Offers Many Good Online Resources

Capitol One is one of the most recognized names in the credit card industry, and millions of people enjoy the benefits of this service, but today they also are becoming known for online banking. In 2012 ING sold their American banking branch to Capitol One, and after a seamless transition, 7.5 million people are appreciating the convenience, benefits, and comfort of banking at home with Capital One 360 Online Banking.

Many Capital One 360 customers are most happy with the savings account features offered to them. While most traditional banks have very low interest rates, Capital One gives users a much more competitive rate to save money, often boasting 15 times higher rate than other banks. They also do not charge fees and have no minimum requirement for accounts. They offer free transfers and are FDIC insured. One of the most interesting features is their sub-account to help online users to track savings for certain categories. For example, one might have a vacation fund, emergency fund, or even a special fund for holidays. This allows customers to automatically deposit money into selected accounts, helping them set savings goals and track their progress.

Traditional checking accounts are also popular with users. These are competitive for earning interest, and also have no maintenance fees or minimum required balance. Users can write checks, make ATM withdrawals at over 40,000 ATM machines in the US, and utilize online bill pay. They can also use debit cards and do not have overdraft fees. Mobile apps and electronic transfers are also making this way of banking even more convenient. They offer "remote check deposit," which means customers can take a picture of a check with Snapshot, their smartphone app, and remotely deposit it. They save time and money as there are no stamps, envelopes, or mailing hassles.

One of the growing trends today is teaching teens and kids about money, and Capital One 360 provides a complete resource to parents to help with this. One of these is an account called MONEY, and it caters to teens and parents. This gives the same excellent benefits of other accounts, but it provides parents with texts and alerts to keep up with transfers. There are also other account options to help younger kids to learn about earning interest, and there is even an option to directly deposit some or all of their allowance into their account.

Capital One 360 also offers a range of other banking options, including home equity loans, stock investments, retirement accounts, and business related savings accounts, CDs, and 401 (K) plans. One of the most convenient, unique choices is the direct integration to Sharebuilder. This is an online broker that allows customers to invest in stocks, mutual funds, and ETFs. The unique pairing of Capital One and Sharebuilder online, is just one more convenience that draws in customers.

Capital One continues to be known for its excellence in the credit card industry, but customers are realizing that Capital One 360 Online Banking offers them a complete banking experience without leaving their homes or businesses. More and more people are choosing Capital One online banking services to work with their busy lives, helping them become more financially secure.

A Sound Financial Plan - Live Like a King on Your Budget

A Sound Financial Plan - Live Like a King on Your Budget

So you want to be rich, wealthy, or financially independent. Seems impossible, right? It's not as hard as you'd think. Let's start with some questions. How many times have you questioned how someone you personally know seems to spend money like it's free? Have you wondered where they are getting their extra money from especially if they make a similar amount of income as you? Have you tried to figure out how they can afford "this" while they are purchasing "that"? We all have, and from my experience, there can be one of two major things happening:

  1. They are living beyond their means, overspending daily, and will eventually get into trouble.
  2. They have created a sound financial plan, save daily, and can spend their money knowing they are OK to do so.

Both of the above examples will allow an individual to purchase things they want and need but the person who creates a sound financial plan and sacrifices a little "now" will be able to keep much more of their very hard-earned money. A little bit of sacrifice really does go a long way.

Living Beyond Your Means

Most of us at some point in our lives will "live beyond our means" whether by choice or necessity, but when this idea, along with overspending, becomes regular practice it's only a matter of time before something happens that could create very real and big financial problem. Living beyond your means keeps you on the edge of paycheck survival and beyond. Below are some behaviors of living beyond your means:

  • Using a credit card to pay for everything
  • Using a credit card to pay for emergencies (no need for this - save an emergency fund instead)
  • Spending more when paying by credit card vs. paying with cash
  • Living paycheck to paycheck without having any extra money or savings
  • Using savings, retirement money, or other investments to pay for regular bills and goods
  • Having a spenders mentality - "I earn my money to be able to spend it"
  • Not tracking what you earn and spend (living on a budget)
  • Making purchases based on the thinking "I can afford the payments"
  • Playing the game "keeping up with the Joneses"

A Sound Financial Plan

A strong financial plan starts with your desire to get your finances in order and then your ability to put your plan into action. Once you begin your plan and stay with it you will begin to experience many great benefits such as:

  • Never paying credit card interest rates and bills again
  • Never having to scramble for money when there is an emergency
  • Not having to live pay check to pay check for the rest of your life
  • Knowing how to control your money
  • Knowing where your money is going
  • Making your money work for you
  • Being able to purchase more expensive items with cash
  • Being able to treat yourself without it creating a debt burden

That's just the tip of the iceberg and every individual will have different benefits. Having a positive surprise from hard work on your finances is one of the best feelings of accomplishment and pride. It's also addictive! Below is a small list of steps you can take to begin creating your own financial plan.

Set Goals - Create some realistic and reasonable goals for your plan. Take it slow at first and once you have reached a goal, review it, revise it, or change it as needed.

Track Your Money and Create a Budget - I am a big money tracking and budget nerd because they work so well. If you know where your money is going you can then make educated decisions about how to handle your money.

Save an Emergency Fund - Saving 3-6 months of your expenses is a great way to have a decent sized stash of cash to pay for those unexpected, but all to regular, emergencies we all have.

Pay Off High Interest Debts - High interest credit cards, auto loans, or any other loan that isn't directly related to improving your finances (example: a business loan) that is at a very high rate must be paid off and destroyed.

Save, Invest, and Build Wealth - Choose a savings or investment method that you are comfortable with and can understand. Savings accounts and some investments are pretty simple. Other investments may be very complicated. If you can't understand it don't invest in it.

Have Fun and Enjoy - The whole reason for creating this plan is give you more enjoyment out of life. Once your plan is set and working, you will see that it is well worth the time, and you will wonder how you ever got along without it.

Hopefully you can see that it's not too difficult to create a very reasonable and sound financial plan to fit your needs. The hardest part now is to stop reading and thinking about it and begin to take action. So, close down your web browser and get to work!

The Perks of Having Business Bank Accounts

The Perks of Having Business Bank Accounts

Start-up businesses would often forego opening business bank accounts and opt to use their personal bank accounts instead. Why is this so? For one, opening a separate account may mean incurring additional expenses. Another thing is that new entrepreneurs would want to reduce risks andso they want to establish their business names first before considering account options. Some are also hesitant to open business bank accounts because they think that it would be too much of a hassle to deal with the legalities associated with opening a corporate account. But should you follow in their footsteps?

Advantages of Opening a Company Bank Accounts

There are in fact a lot of advantages of having business bank accounts. Here are some of them:

  • It organises your finances and makes it easier for you to check your income and expenditure for the year. If you don't have a business account, it will prove to be more difficult and time-consuming since you will have to separate and distinguish the personal transactions from that of the business banking transactions.

  • Another advantage of having business bank accounts is that it gives your business a professional profile especially when it comes to transactions with customers. This also shows that you are serious and focus-oriented on the ends of the business. And besides, a guaranteed business account will also help speed up the day-to-day financial transactions that you have.

  • The edge of having a separate business bank account would be transparency in financial transactions and in declaration of income. The flow of income and expenses should be clear. This also further shows tax authorities that you are a responsible business owner because you uphold transparency in business transactions and can pay your taxes in a timely manner.

  • Having a company or business bank account will actually get you more perks than nuisance. Some banking institutions for example would offer free business banking for a year for start-up businesses. Some banks could also offer business accounting software to be used on their day-to-day business operations on finances.

  • Finally, it will be easier for you to apply for business loans if you have an active business bank account.

Online Banking at Its Peak

A great thing about the technological advancements available today is that banking can already be done online. Online banking has become a growing necessity for business people who are always on the go, thereby making financial transactions very easy and convenient, as everything is done on a virtual landscape and can be completed quickly. Online banking also provides you easy access to your business data and income, and helps you keep track of your expenses. The element of speedy transactions is magnified online as well because your borganisation now runs on your own time and not on banking hours. You can easily pay bills and receive funds in a secure and fast manner, no matter what time of the day it is. So, with common banking concerns at bay, the company can now focus more on other important matters like generating sales.

The Reality About PPI Insurance Claims Companies

The Reality About PPI Insurance Claims Companies

In case your Payment Protection Insurance happens to be mis-sold and now you're looking to get it back (and even if you're not), chances are PPI insurance claims companies have been courting you non-stop. You've most likely been bombarded with messages; perhaps you've seen fliers. Or maybe some random salesperson has halted you before and advertised PPI insurance claims service that assures the quick return of your hard earned cash.

And perhaps, if you've experienced those uncooperative banks, you might be lured to take them up on their offer.

Payment protection insurance (PPI) guarantees repayment of loans just in case you lose your job, get sick, get impaired, or die. Today, the problem is it's not impossible to claim your PPI stat. A number of high-profile banks and companies have been mis-selling PPI on a big scale for over ten years. While the true mis-selling has reduced since the government designed a crackdown of these shady (but popular) companies, the people whose PPI had been mis-sold are have a tough time. These companies often reject claims or process them very slowly.

This is where PPI insurance claims companies come in. They work as middlemen and fixers, promising quick processing of your PPI insurance claims. But don't be tricked. Regardless how appealing it is to just let somebody else handle your PPI because working with your bank is just very stressful, never ever employ a PPI insurance claims company.

Here's the fact: PPI insurance claims companies don't make processing of your claims go faster. In reality, employing middlemen will likely make things even sluggish than they seem to be. In case you really need a refund, have it returned yourself. For another, PPI insurance claims providers get a tremendous amount of your PPI money for taxes, services, and other stuff like that. You're lucky if you get 1 / 2 of your PPI cash back.

If you should get your cash back (and you must), you've got to depend on yourself. Act by yourself. Seek guidance but never help. You've been mislead once; don't allow PPI insurance claims companies con you again.

For trusted advice on how to get back PPI, look into PPI support communities (both on the web and in the real world). Numerous organizations were created during and after the PPI disaster, and there are many accounts of success among them. Listen to their stories and maybe you may follow their cases. Besides, misery loves company. Railing and cursing against your PPI company and/or the claims company you've wrongly hired in a crowd might prove cathartic to you.

While you're searching for advice from people who are in the same boat, you may pull out those old PPI transaction folders you haven't seen for years and begin re-reading those papers. Review all your contracts and transactions. Look into the fine print. And then visit the bank and make your claim. Provided that there's no problem with your data, they must start processing and filing your claim.

If however your bank/PPI firm is being stubborn (as is necessary), you can always file a complaint to the Financial Ombudsman Service. They'll look into your case and pressure the bank to pay quickly and completely. Use this as your last measure.

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