Understanding Banks and Their Services

Without money, it's hard to make it in this world. Whether you have a lot or a little money, you need some place to store it all. This is why banks are necessary. You may not have known how essential these financial centers are. If you have all your savings and earnings just laying around the house, you must think twice. What if you happened to misplace it? What if it was stolen? Big losses are hard to get back. Here's a little info on the different types of facilities that exist to protect your money. You need a better idea of their function and how to get what you need.

There are many types of banks that exist today. No matter what your plans are for your money, there's a place where you can manage it all. One type of facility is an investment depository. This is where businesses can raise money and work in the investment market. Bonds and stocks are distributed at this type of facility. Commercial depositories also work with businesses. These facilities provide checking and savings accounts for all kinds of businesses big and small. And of course there are retail banks. These are the facilities that everyday individuals set up accounts, cash their checks, and handle financial business. Credit unions are non-profit organizations that are owned by the members or individuals who are a part of it. There are so many options when it comes to storing your money the right way.

Your personal funds are unprotected or unsafe if they are not properly stored. Using these services also makes it much easier to keep track of your amounts and transactions. Piggy banks are for kids. Once you become a full grown adult with a steady income, it will be difficult to keep track of all that money without the proper tools. But each facility has its own set of terms and agreements. To start a personal savings account, customers must have a certain amount in order to open it. Customers with checking accounts may be offered a debit card as well. This will teach them financial and spending responsibility. Also, having a checking account will save customers the money they would normally spend buying money orders or cashing checks without an account.

It's no secret that people's spending habits can get out of control. The services of banks can help people to save more and limit their habits. Customers can be alerted when their funds get too low. There are also monthly bank statements issued to all customers. This way individuals can be reminded of their budgets and keep track of what was spent. You may not have noticed how convenient these features are. Speaking with a banker can be the beginning of a great decision. Not everyone is good with math and counting. Professionals can do this for you as well as keep your money safe and protected for years and years to come. There is a financial center that is right for you and your needs.

First Time Buyer Programs - Should You Buy Your Home This Way?

Have you always dreamed of owning of your own house but are unable to do it on your own? There are first time buyer programs which have been designed to come to the aid of people who don't have a high income. However, you need to understand exactly what these programs entail before you make your decision. After all, buying a home is no small step. Resources such as BuyerPrograms.net indicate that these programs are very useful, both for you and the community.

First time home buyer programs vary from state to state. Even so, they have certain similarities in how they are run. Depending on where you live, the benefits of this program could include:

* Very affordable down payment (or none at all)

* Attractively low rates of interest

* Reduced fees and charges on various services associated with the loan

* Deferred payments in the event that you run into financial difficulties

On casual examination, these buyer programs are very attractive but you have to be prepared for a few problems. These problems can be quite serious but this too depends on which state you live in. The various problems associated with first time home buyers programs include:

1. You generally won't be able to select the best property in an area. If you take assistance from this program then you will only be able to select from low value properties in a particular area. This is because there is generally a limit on the money made available to you through this program.

2. There are sometimes restrictions on when you can sell your home or rent it out. If your circumstances improve and you want to trade the house for something better then you won't be able to.

3. In some cases, you might have to pay the lender part of the increase in value of your home.

4. You might not be offered a big range of mortgage options since you are in any case getting your money at a very attractive rate of interest.

The only reason you should take help from first time buyer programs to buy your home is if you are genuinely in need of money and are willing to stay in a home that is not quite the best one in your city. If you meet the income restrictions of the program then this is a very good way to start building your assets right up from scratch.

6 Ways to Get Your Information Quickly in QuickBooks

Let's face it - you're busy, you have information you want to know but don't want to spend all day getting it. Especially in the summer when you are either at your busy season or want to go on vacation. So here are 6 ways you can get your reporting quickly.

1. The Company Snapshot - still one of my favorite features in QuickBooks. You can check on payables, receivables, account balances, see trends in income and expenses, reminders and much more - all in one place. You can choose from 12 possible reports, organize them any way you want and choose the time frame from the drop-down menu (no custom dates). Past due invoices and bills show up in red, making it easy to pick them out. You can even print the snapshot.
2. Process Multiple Reports - Run several reports at one time. You can click on Reports>Process Multiple Reports then choose the reports and dates. Guaranteed this is faster than you doing these reports individually.
3. Run a Group of reports. This can be even much faster than the Process Multiple Reports - definitely a very powerful timesaver. So often when you run a report, you want it customized. (I'm hoping you memorize it so you don't have to recreate the reports each time!) Save the report to a Group when you memorize. To run the group, simply click Reports>Memorized Report list. From that list, double-click on the Group you want to run and all the reports in the Group will run!
4. Having groups also helps you organize your reports so you can find reports more easily. How many of you have a ton of reports, all with similar names and you don't know which one you need to you use so you create another?! I've seen many outdated memorized report lists. Some Group ideas could be weekly, monthly, quarterly, during a project/job, after a job, open orders... you get the idea.
5. Put your report(s) on your toolbar. While I'm a firm believer that all QuickBooks users should have their own login information for security reasons, another benefit is that you can customize QuickBooks to suit your personal preferences - including what's on the toolbar. So if you have a report you want to see frequently, click on View>Add (and it will list the name of the report), then give it a name (I recommend keeping the name short). Next time you want to review that information, it's simply a click away!
6. Update a spreadsheet. This was a new feature in QuickBooks 2012. How often do you want to export to Excel and simply have the spreadsheet updated? You may have special formatting in the spreadsheet, or perhaps additional columns with your own formulas or inserted rows. Rather than recreating this spreadsheet from scratch each time, simply update the spreadsheet. You can either update from QuickBooks or Excel (in the QuickBooks menu)
7. If you have multiple companies and use QuickBooks Enterprise Solutions, another powerful feature is the Combine Reports from Multiple Company (Reports>Combine Reports from Multiple Companies). Then select the company files, the reports, date range, etc. Your reports will appear in Excel with columns for each company. Since the chart of accounts is often different between the two companies, having the software create the spreadsheet for you is a big timesaver.

So next time you want information from QuickBooks, don't let this take any longer than necessary. Get the information you need so you stay on top of your business, sales, jobs and head out the door sooner, be it for work - or fun!

The Good Bank - An Alternative Solution to the Banking Crisis

Last week I read Atlas Shrugged by Ayn Rand and I started to wonder: "Who is trying to stop the motor of the world?" The main culprit seems to be the federal government, which is behaving the same way as Rand's fictional "looters." And, since America's economy today is eerily similar to Rand's depiction of a society in decline, this brings up yet another question: Who and where is the modern-day "John Galt?"

If he does exist, maybe he can tell us how to fix the current fiscal mess. This question is being debated ad nauseam and yet nobody has come up with a plausible answer. So here is some outside-the-box thinking to help save the institution that made this country great: free market capitalism.

The "bad bank" is one idea being proposed, where an entity will be created to buy up all the toxic assets from the failing financial institutions. But where will all those toxic assets go? Do they just disappear into thin air? No, they would stay on a balance sheet until that institution calls them what they are - worthless.

As I ponder the questionable validity of the "bad bank" idea, it also leads me to wonder how the government expects to eliminate moral hazard without letting failing businesses go bankrupt.

Prior to July of 2007, most institutions were taking high risks with their mortgage related investments, predicting that, if they were to face bankruptcy, the government would bail them out. This assumption has proven to be correct. Due to the government's unwillingness to allow large banks to collapse, our financial institutions will continue to make the same mistakes time and time again. In other words, there's no longer any risk in "risky" investments. The government may honestly believe that bailouts are good for the economy, but they are only compounding the problem and making the recession worse.

Here is a proposed solution for this problem: A hybrid of free market capitalism and temporary government intervention. The first part of the remedy is, let the poorly run institutions fail. The most efficient economy is one where a large number of companies compete against one another. In an inefficient economy, fewer businesses compete. So by allowing mismanaged or incompetent banks to declare bankruptcy, we are also allowing entrepreneurial and properly managed financial institutions to spring up in their place. More importantly, this approach eliminates moral hazard and proves that risk is a very real thing that should not be ignored.

The problem with the "cold turkey" approach is that we would have to go through a significant amount of hardship to correct the current course we are on. It would also cause many efficient businesses to close up shop as the demand for their goods and services diminishes. Although this approach would ultimately correct the flaws in our system, no politician who values his job would casually ask the public to accept such draconian measures.

How about this: Instead of creating a "bad bank" to buy up all the toxic assets, create a "good bank," which would receive the taxpayer's dollars and have a mandate to lend the money only to qualified borrowers.

If we take the banking formula of lending $10 for each $1 in deposits, we could appropriate $100 billion of the taxpayers' money that is allocated for any one of the insolvent financial institutions - which will most likely fail anyway - and create a "good bank." This $100 billion could lend $1 trillion to qualified borrowers.

Is this nationalization? Yes, but isn't this what the government is doing right now anyway?

Fortunately, there is a solution for that. The "good bank" will be mandated to lend out to borrowers at a rate of, for example, 1 percent over the market rate. This makes sense because if people cannot get a loan or line of credit from anywhere else, they will still be able to get one from this "good bank," as long as they fit the criteria. This approach solves two problems: First, it frees up the capital for the borrowers who normally can get a loan or line of credit. Second, it actually ensures that the institution will not become a perpetual entity that public policy could screw up later at the whim of an overzealous politician.

Mandating 1 percent over market rates allows this institution to naturally dissipate when the free markets return. It will remain deliberately uncompetitive. This way, the taxpayers get their money back with a decent return, and the bank will not become a permanent liability down the road.

What about the large financial institutions we are trying to save for the benefit of our economy and society? Obviously, this new entity would circumvent the need for these institutions.

In other words, this approach would take business away from the failed institutions and allow efficient ones to run as they should. The "bad banks" are not lending the money given to them by the taxpayers anyway, so why should we enable them?

Once the failed financial institutions "fix" their problems, they would be able to operate again and take business back through competitive pricing. If they fail, then the new bank would compensate for the loss, and the supply of lending to the market would not suffer. The bankruptcy courts would sort out what the other financial companies don't pick clean by way of acquisitions. Letting nature take its course would bring us back to the Darwinian principle of the survival of the fittest.

If John Galt is among us, let us hope he does not wait for our economy to collapse before providing an answer to our problems, or else the "looters" will come up with a solution of their own.

Disclaimer: This article is intended solely for informational purposes only, and in no manner intended to solicit any product or service. The opinions in this article are exclusively of the author(s) and may or may not reflect all those who are employed, either directly or indirectly or affiliated with NUA Advisors, LLC.

By: Kirk Chisholm, Principal and Wealth Manager, NUA Advisors, LLC

How to Buy Insurance On Your Stock Positions

Member questions frequently drive S.A.F.E. Insights and this week's is no different. With the market at all-time highs, but the underlying economy still in question, many people are wondering if they can protect their positions that have in many cases restored their wealth. The answer is yes, you can insure your positions and it is not that difficult.

The free-markets have existed for many centuries and over that expansive history, investors, bankers & brokers have devised an endless stream of investment possibilities. From the earliest days under the Buttonwood Tree (that's a tree in New York where the Exchange started) investors buying public stocks looked for ways to guarantee their stocks future price, even if the future price dropped. Agricultural people have been doing this for a very long time. Farmers can lock in prices on their crops long before they harvest them and sell them by using the futures market. Well stock investors can do the same thing.

Let's think about the nature of insurance. You cover your life's various risks by buying an insurance contract in which you pay a premium to someone who guarantees you that in the future, if things go against you, a flood, a tornado, an earthquake, etc., that insurer will make you whole and restore your value to the current level. In most instances, the seller of the insurance (or writer) doesn't have to pay. If I buy earthquake insurance and there's no earthquake, the writer of the insurance keeps my premium; but if an earthquake hits, the writer of my insurance is required to pay me whatever value the contract calls for. Virtually all of us have insurance of one sort or another; auto, health, life disability, etc., but most professional investors have insurance on their stocks when things look volatile.

So let's translate that to stocks. For example, I own ABC Stock that presently is priced at $50.00 per share. I'm quite nervous about that price because it's only recently that it came back from its' low price of $25.00 and now that I'm whole, I don't want to lose it again. But, I don't want to sell it because I think it can go higher. This is where insurance comes in. The United States has the most developed and liquid markets in the whole world. One of the many advantages of that is that our markets offer very liquid insurance in the form of a "put." A "put" is a contract between you (the buyer) and the writer (seller) of the put. You want your $50.00 price assured but you think it could go higher. In such a liquid market as ours, there are always different opinions, so you find a person who thinks the $50.00 stock may go down. Because they think it will go down, they are willing to risk a price drop from $50.00. So you buy from this person a put contract that says you can "put" or sell your stock to that person for $50.00 at some point in the future. So you can now rest easy knowing that you've bought insurance on that stock; that if it drops to say $45.00 you can still put it to this person at $50.00. If the stock goes up, you keep your gains because you still own the stock. Pretty neat huh.

There is a downside though, while there is absolutely NO stock risk to buying a put like this, you do risk in a sense, 100% of your premium. It's like auto insurance, if you never have a crash you've "wasted" the premium. Same here, if the stock doesn't drop, you've "wasted" the cost of the put. Puts can be bought in various time segments, there are three, six, and even 12 month or longer contracts. The thing you have to understand is that the cost of these options is fairly priced generally speaking because there are lots and lots of options buyers & sellers and the market is relatively efficient. So you're not getting a "free lunch" here, but you are protecting your value.

When you become comfortable with buying puts, there is always the other side, selling calls. We'll write about how that can increase your income another time.

Why Security of Payment Is Important

There are payment disputes in every field however the building and construction industry sees the most as it's one of the largest industries that have plenty of different parties working together to accomplish a single final goal.

Since there are plenty of disputes regarding payments there are also acts to prevent such malpractices and make sure that there are legal solutions to all such problems. Security of payment was recently introduced in order to provide quick financial help to people as well as large companies that were facing payment disputes of any kind.

In the earlier days such disputes took up a lot of time and you had to work really hard in order to win an argument in court, let alone the prices that you had to pay in order to take the particular case to court.

Therefore, with the use of such security of payment procedures you would be able to get rid of any kind of issue and come to a settlement through adjudication.

Therefore, no matter what you work as and where you work you're going to need to have information about these acts as you'd never know when you may need them for your own purpose.

Claiming the cash

Before you can even think of beginning the process of adjudication you would need to file a payment sheet. The two parties are going to be the claimants and respondents. The respondents would have to defend themselves against the claim set forth by the claimant party.

However, in order for any such claim to be taken into consideration it would need to be filed within a stipulated time frame. The time frame needs to be decided between both the parties and this can be a whole different issue in most cases.

Contents of your claim

As already mentioned, the adjudication process can only begin once you've filed your claim and this will pave the way for the rest of the process. What you write in your claim needs to be specific and to the point detailing every aspect of the deal and the problem between the two parties involved.

This process can be really complex and you may need the services of an attorney who specializes in such a field. There are plenty of lawyers who would be able to help you out, but when looking make sure that you pick someone who is good at security of payment claims.

Don't Make These 6 Mistakes When Hiring a New Employee

It can be very difficult to find good employees when you really need them. Many employers who are in a rush to find someone to fill a position often make mistakes that end up being costly later on. There are ways to avoid these common mistakes if you take the time to remind yourself of them.

Don't ignore your instincts. Sometimes your gut just knows that hiring a certain person is a bad idea. Trust your instincts. From years of experience, your brain knows what to look for in an employee, and apparently this person just does not have what it takes. Your body most likely knows it before you are even aware of it. Trust your feelings, or set up a second interview to see if you still feel the same in a few days.

Don't rely on someone else's judgment. Many applicants are referred to employers through people who have connections to you or your business. Just because they were referred to you through a trusted friend or employee doesn't mean that they are right for your business. You must take the time to get to know the applicant just as you would do for any other applicant.

This job seeker may not be all that was told to you. You should not feel bad about not hiring someone's brother or down-on-his-luck nephew. Business is not personal, and you should not hire someone who is beneath your standards. Do what is best for your business and not what is best for your friends.

Don't rely on the applicant's references. You may think that contacting the applicant's references is a sure way to know whether the person is responsible, reliable, and trustworthy. However, anyone could be listed as a reference. Do you really know that you are talking to someone who is an adequate judge of character? Are you really speaking to the person listed on the application?

Don't forget to ask for a signature for an employment background check. Asking a potential employee to consent to a screening will truly allow you to know who this person is. You will be able to find out how long they have been at a particular job, whether or not they have any related work experience, and much more. You may also request consent for criminal background and credit checks.

Applicants who do not want the truth to be known will often steer clear of these requests. It is a great deterrent for applicants who are less than trustworthy or responsible. You will be protecting your business and your employees with these types of checks.

Remember to hold out for the right employee to come along. It can be very tempting to want to hire the first person that comes along for a position, especially when you may not have had a lot of applicants for the position. You still need to make an informed decision before hiring anyone, even if you are in desperate need of a new employee.

Always start a trial employment first. Trial employment can give you time to really assess an employee to make sure that he or she is the right fit for the job. Be clear about the temporary position, when the trial period is over, and what to expect during this trial period.

You will feel much more empowered and informed when following these practices regarding the hiring of new employees. You are liable for every employee that you hire, so you need to know who you are hiring and what you can expect from them. In return, they also need to know what to expect from you. Be clear about your intentions to get to know them and then follow through with your actions.