Tuesday, March 10, 2009

What to Look For in a Money Counter

You may initially consider buying a money counter to eliminate wasted time or to increase counting accuracy; or both. But once you have decided to purchase a money counter, how do you know which one is right for you? I did some research recently to develop a list of criteria to help you decide! It is important to choose the counter that best fits your company’s needs to increase efficiency and productivity during the money handling process.

Counterfeit Detection

First, consider whether you will need the option of counterfeit detection. If counterfeiting is a concern, you may want to purchase a counter/counterfeit detection combination machine. Typically these detectors use ultraviolet light or a combinations of ultraviolet light and magnetic detection to prevent the acceptance of fake bills. In general, money counters with added counterfeit options are more expensive and machines with both ultraviolet and magnetic detection are usually a little more expensive, but offer increased protection and versatility. In businesses completing a high number of transactions with large bills, money counters/counterfeit detectors are vital to accuracy and security.

Discriminators and International Currency

To make counting even faster, machines are available that are able to detect different bill denominations. These machines are called discriminators and are usually much more expensive than a typical money counter, but can be a huge time-saver for businesses counting large amounts of cash. Some counters are capable of detecting international bills, as well as separating smaller sized bills. When counting bills from multiple countries, international detection is a must.

Vertical or Horizontal Feed

Machines are available that can be loaded flat, by stacking bills, or loaded standing up, on the bill’s side. Machines that accept stacked bills are called horizontal feeders and those that accept only bills on edge are called vertical feeders. A horizontal feed allows the user to stack more bills into the hopper and reduces time when counting a large number of bills. For counting less than 100 bills at a time, a vertical feed is sufficient.

Additional Features

Money counters come with a variety of extra features to accommodate almost any counting needs. For instance, some models come with an external count display that allows more than one person to view the running count. This feature is perfect for situations when a teller is counting bills for a customer. Machines intended for large counting operations often come with a dust shield to deflect dust and debris away from the operator’s face.

Warranty and Service

Finally, like any product you may consider buying, investigate the specific brand’s warranty and service agreements. Ideally, you will want to find a money counter that remains under warranty for at least one year. Many manufacturers offer on-site service packages for maintenance and repair on your counter. To ensure you purchase a counter that has a long life, find one that offers the best possible warranty and service agreement.

When you are looking for a money counter remember there are an assortment of models with different features, don’t settle on a machine that doesn’t fully accommodate your needs. Examine all the possible features and choose the product that helps increase your efficiency and productivity the most. Use these basic guidelines to help narrow your product search and find the counter that is right for you!

Canadian Debt Consolidation

Our lives are full of shocks, surprises and twists. When we are challenged financially we often freeze in fear and stand-by watching as our lives deteriorate into a nightmare. Money problems are a common occurrence in the current financial climate. They are often brought on by poor health unexpected job loss, motoring expenses, addiction, and many other mishaps. When we finally realise our dire circumstances it's often too late and the shock strikes hard. So what do we do when we realise we cannot even afford minimum payments?

People from Canada are just as likely to experience financial difficulty as anyone else on the planet. Luckily, Canadians are able to seek Canadian debt relief. Debt consolidation loans are varied and work in many different ways.

The primary debt consolidation method utilises the professional services of a debt specialist. The job of this individual is to liaise with and negotiate with the clients creditors. Expert debt consolidation specialists are able to organise and negotiate reduced loan payments and interest rates. Both of these strategies bring forward the final payment date. This Canadian debt consolidation method is best used by debtors who identify and act on their problem before they reach bankruptcy. The big advantage associated with this method is the fact that the arrangements are satisfactory for all parties involved. Once the debtor has paid off the outstanding funds, he can make a fresh start.

The beauty of this approach is that it allows the debt consolidation specialists to build a strong relationship with the lending companies. They develop a trust which is otherwise hard to achieve between debtors and their lenders.

The debtor also has the advantage of being able to rely on an expert with the experience to realise what they can afford each month. The debt consolidation expert therefore, is able to rely on his expertise to ensure the debtor is provided with a practical arrangement that he's able to meet. It is his responsibility to help the debtor get back on their own two feet. It's in the consolidation expert's best interest to provide an effective service for future employment testimonies.

The second debt consolidation method is Canadian debt relief. If he is accepted the debtor is loaned sufficient funds by a financial institution to clear his debt. He uses the borrowed money to make the final lump sum payment. This breaks him away from the entanglement of higher interest debt. He now has a much lower interest rate loan to pay back. The advantage of this is that it is a single monthly payment as opposed to multiple smaller payments, it's far easier to manage and keep track of. Once he's made several payments towards this new loan he will see massive improvements in his credit rating.

Bankruptcy in Canada can often be avoided by making use of country's well-established debt relief systems. The benefits attached to a debt consolidation service in Canada are immense and can easily assist the debtor's desire to improve his credit score. If your debt is becoming too much and you feel overwhelmed it's time to look at Canadian debt consolidation as a means to improve your situation.

Using The “Autograph” To Get Cheap Motor Insurance

What if your motor insurance provider told you that you could get up to 25 percent discounted from your next car insurance policy simply by showing them that you were a safe driver? It would sound obvious won’t it - after all, basically, isn’t that what a no claims bonus is all about? Well, you can guess again, because with the new “autograph” device getting up to 25 percent discounted on your car insurance policy in the years to come is going to be a very real experience!

What Is The Autograph?

Basically, an “autograph” is a device that you ask a garage to plug into the diagnostic part of your car (which can be found underneath your steering wheel). The autograph will then record all of your driving skills, including how fast you drive, your average speed, whether or not you need to suddenly break (and, if so, how often), the times of the day that you like to be out and about on the roads, what your average mileage is, what your longest and shortest journeys are. In fact, the list is endless. After a pre-determined period, say three or six months, you then return to garage that installed the autograph and they will uninstall it and replace it with a new one. The old autograph is then plugged into a computer and all the requested recorded data is feed into a computer and sent to your motor insurance provider. Your motor insurance provider can then take a look at all of this recorded data and can decide, more accurately, if you are a high or low risk driver!

Benefits of the Autograph

If you are a good driver, the benefits of agreeing to use an autograph are easy to see – after all, recorded data rarely lies! The downside to using an autograph is the fact that it is recording the data collected in the car. This has two effects – first, you have to have a car capable of recording this data (i.e., not too old); second, the data collection cannot differentiate between drivers. As such, if you have a car in your house that is driven by several different people, the autograph will not be able to tell who is driving the car at any given time. Consequently, if you have your son or daughter on your car insurance and they tell you they like to drive at 50 miles an hour, while the autograph tells the motor insurance provider they like to drive at 120 miles an hour, it’s not likely you are going to be getting the 25 percent policy premium discount you were looking for!

All in all though, as with pay per mile car insurance, getting cheap car insurance using an autograph device, although being the way of the future, is here to stay and will most probably benefit far more motor drives than it inhibits.

Using Cell Phones While Driving Increases Car Insurance Rates

Cell phones are the omnipresent electronic devices of this era, and multi-tasking is the byword of this generation. So, it is quite natural to see many people jovially chatting over the mobile phone or thumbing down instant jokes while negotiating the traffic on busy highways. It is a habit that spreads like the bushfire does in Australia. And in the long run, it is as deadly as well.

Studies have proved that drivers who use cell phones while driving are more prone to cause accidents. Many researchers have equated driving while using mobile phones (or is it the other way around?) to drunken driving. They say that in both cases, a person does not have enough focus and mental capacity to carry out a potentially dangerous activity like driving. If you also have this habit, do not shrug and dismiss this article as nonsense. There are many gains - both for you and for others - if you do away with this habit.

The Advantages Of Stopping Cell Phone Use While Driving

The primary advantage is that you are keeping a safe distance from accidents. It has been estimated through various studies that a person using cell phone is four times more likely to meet with an accident. The reasons for this are not hard to understand. One cannot focus fully on the road and the other vehicles, if one keeps on chatting on phone simultaneously while driving. Thumping, or writing text messages on the cell phone, is a doubly dangerous activity. It requires the driver to control the vehicle with one hand and half a mind.

Well, let us drive past the usual negative thoughts on the same subject, such as accidents can happen to anybody and other similar gospels. Just for the record, there are a number of people who have been driving without causing any major accident.

The second, and perhaps a more tangible, benefit is the reduced car insurance Canada premium. In many states in the USA, using cell phone while driving is a traffic offense that can get you a penalty ticket. The more the number of tickets you attract against your name, the higher will be the insurance premium. In these troubled times of economic recession, insurance companies are eagerly waiting for something to increase the insurance premium. They can easily track the tickets against your name, even if you got those in faraway locations.

The rules regarding this are not consistent across the country. Different states have different sets of rules. At present, seven states have banned talking through a handheld device and texting while driving for general public. But more states - 17, to be precise - have banned the use of mobile handset device for beginner drivers. Several states allow the person to use hands-free device for talking through the cell phone while driving. But it is strongly reminded that driving does not lend itself to multitasking.

Young drivers should be more conscious about the financial burden, if not the social troubles, that can be resulted from their cell-phone-induced driving. The rules regarding cell phone use are more stringent for the new drivers and the increase in the tax premium is steeper. The bottom line is that using cell phones while driving not only increases your phone bills, but raises your car insurance premium as well.

Thursday, February 26, 2009

Split Dollar Insurance

What is Split Dollar Insurance? You may or may not have heard of this term. It sounds very sophisticated at first, but with a little explanation, this type of insurance is easily understood.

Split Dollar Insurance is when two entities, an employee and an employer, pay premiums and the benefits of a life insurance policy are shared between the two. The policy benefits are split and the costs, or premiums, may be split, as well. The insurance is on the life of the employee. This provides insurance to the employee at a reduced cost.

Why would a company want to have this type of insurance available? It is used to give a reduced cost life insurance policy to an employee. This is viewed as a valuable added benefit to the employee. Therefore, companies can use this sort of insurance as a way to retain employees. Getting good employees loyal and committed to your company is not always an easy prospect. When the good fortune of the company arrives and there is a good group of employees in place, some companies realize that they need to do something to retain these people. Good people are hard to find.

Take, for example, the financial industry itself. At one financial company the brokers and registered representative are doing a good job. They get noticed. But they don’t just get noticed by their own company, the other companies in the industry are hearing about what a good job Joe Smith is doing over at Eastern Financial. Before they know it their employee is trying to be lured over to that company. Of course this other company has a lot to offer, as well. They say well your reputation is impeccable and we want you to come and work for us. Since we know that we have to make it worth your while, we will offer you benefits such as health insurance coverage and a 401(k) plan. But the loyal employee turns down the offer because they realize that they have all of those benefits and more. They also have insurance at a reduced cost. This type of offering made available by the current employer with the split dollar insurance, made a difference to the employee. This was an added benefit that helped make the ultimate decision to not leave a company that takes such good care of their employees.

It is important to understand that split dollar insurance is not a qualified plan. A qualified plan has to meet certain Internal Revenue Code criteria. This means that it qualifies for favorable tax treatment. What is good about qualified plans is that they have tax deductible contributions and tax-deferred growth. Further, there are employers that contribute to these plans. When they do, generally speaking, their contributions to these plans are viewed as a business expense for tax purposes. However, split dollar insurance does not fall into this category.

Moreover, the company is not profiting from the split dollar arrangement, they merely want to recoup their costs. They are usually not looking for a tax advantage either. They just want to be able to offer a fringe benefit to the employee. Usually this type of insurance is selectively offered as an executive perk.

Life insurance can help provide protection and benefits to people in many different situations. The best way to get an understanding of what one’s needs are is to connect with an insurance agent. They can get an understanding of your specific situation and suggest products to provide the best overall answers to one’s needs.

The Absa Mortgage Options and Benefits

Absa is clearly a big name in the banking industry of South Africa with assets worth more than R456 billion and was formed in 1991. With Barclays having a +-56% stake in ABSA makes one feel more secure. And after all, security is the thing everyone is after when it comes to mortgages.

ABSA is a very popular South African Bank and is one of the largest when it comes to bonds.

Absa has a number of mortgage options, structured to fit every conceivable budget. Absa are known above all for their MultiPlan option and wide range of choices for lower-income home owners.

So let’s take a look at Absa’s main home loan product, the MyHome option. This product is pointed at first time and low-income home owners with add-ons and special features. Absa also provides building loans to cater for the needs of the growing number of small businesses in South Africa, as well as a buy-to-let option for aspirant landlords.

This home loan product is very flexible and can be customized to suit everyone’s needs. That is what truly makes this product so unique. MyHome has been designed in such a way that it really isn’t a home loan package at all; it is a home-building block that can be conjoined with multiple add-on options and features in the same way you’d use a little black dress to create a wardrobe of various clothes for every event.

The benefits that you get with the Absa home loan is that you can assign your repayments by selecting your preferred interval and choosing which interest rate you’d prefer, flexible or variable. With the current economic climate, having this choice is important. With electronic banking and due-debit orders, transactions are quick and easy to make.

The MyHome mortgage product is for everyone who earns less than $750 a month. You can even get this option without having a formal proof of income and the TartetSave product will help you working towards overcoming this obstacle. Absa also offers insurance options to insurance your home when getting this option.

When you apply for a mortgage, you have to make sure that the loan will adabt to your budget and needs.

With the FastForward product, you can automatically enlarge your bond repayments. It is in your best advantage to pay of your house as soon as possible as this will save you thousands in the long term. If you need money then FlexiReserve is the way to go. With this you will be able to withdraw cash in your bond account when you need it. You can do this easily. The FurtherAdvance allows you to register a higher amount on your home loan up front, even before you need it, so that you have access to that virtual loan if and when you do need it. This option will let you save thousands in the long run as your house will be worth that increase. With Multiplan you can configure your mortgage account into separate accounts with different interest rates, terms, etc. MultiPlan is like a spreadsheet; you can design the way you want to handle your bond yourself.

Cheap Car Insurance Companies Online In Alabama

If you are going to drive a car in Alabama you'd better buy car insurance. The penalties for driving without insurance include having your car's registration suspended and paying a fine of $100 - plus a lot of time and aggravation. Fortunately the state of Alabama makes a very cheap form of auto insurance available to its drivers, a type of car insurance that virtually every driver can afford.

It's known as a 20/40/10 basic liability policy. This is the cheapest insurance policy that you can buy in Alabama and still drive 100% legally.

This policy pays a maximum of $20,000 toward the medical expenses of any one individual who is hurt as a result of an accident with your vehicle. It pays a maximum of $40,000 toward the medical expenses of everyone involved in an accident with your vehicle - this $40,000 maximum payment is made regardless of how many people are hurt or how badly they are hurt. The policy also pays a maximum of $10,000 in property damage (typically the repair of the other person's vehicle).

There are a couple of things you should be aware of if you are thinking about buying this insurance. First, a liability policy pays NOTHING toward repairing your car after an accident nor does it pay anything toward any of your medical costs or the medical expenses of anyone in your car at the time of an accident.

The other thing you need to understand is that the maximum payouts on a basic liability policy are rather small. It is not difficult to run up medical bills in excess of $20,000 or even $40,000 after even a moderate-sized accident. Also, the cost of repairing most modern cars is astronomical - for some models a simple fender-bender can almost run $10,000.

The reason this is important is because if your insurance doesn't cover all of the medical bills or all of the property damage caused by your vehicle in an accident it is possible that YOU could be forced to pay the difference out of your own pocket or purse. That means your life savings could be wiped out or you could even be forced to sell your home to pay the bills.

But regardless of what kind of cheap car insurance you're looking for the best place to find it is online. Online insurance sellers have very little overhead and they pass those rather substantial savings on to you.

In order to insure that you are getting the very best price possible you're going to want to see the prices from the largest number of companies possible. The best way to do that is to make your car insurance price comparisons on more than one site and not relay on the results you get from just one site.

Once you've reviewed all of the prices you've found, getting the best deal is as easy as simply choosing the lowest price. The state of Alabama wants you to know that it is absolutely serious when it says that you must buy car insurance before you drive a car on its roadways. If you're caught driving in Alabama without car insurance your car's registration can be revoked on the spot, meaning your car may be impounded at a tremendous cost to you. Plus you'll have to pay a fine of $100. Fortunately the state of Alabama offers its drivers a very cheap high risk auto insurance that almost anyone can afford to buy.

This cheap insurance is called a basic liability policy. Every state has one and every state sets the minimum payouts that such insurance must make. In Alabama the cheapest insurance policy you can legally buy is called a 20/40/10 liability policy.

What this means is that the policy will pay a maximum of $20,000 to pay the medical bills of any one individual person who is hurt in an accident with your vehicle. The insurance will pay a maximum of $40,000 to pay the medical bills of everyone in the other vehicle who is hurt. Plus the insurance will pay a maximum of $10,000 in property damage - usually the repair of the other person's car.

If you are familiar with medical costs or with the high cost of car repairs you will understand why this cheap insurance is considered a high risk type of insurance. It doesn't take a very big accident for someone to need considerably more than $20,000 to pay their medical bills, and it doesn't take much of an accident to cause far more than $10,000 in damage to someone's vehicle.

So what happens if you are at fault in an accident and the bills are higher than your basic liability policy will cover? It's possible that YOU could be forced to pay the difference. Some people have lost their entire life savings or have even been forced to sell their home because of one car accident.

Still, if you are looking for the cheapest high risk auto insurance there is, a basic liability policy fits the bill. And if you want to get it at the best price possible then you'll definitely want to buy your policy online. Buying your policy online will save you a ton of money!

In order to guarantee than you have found the best possible price when you start comparing auto policy prices online you'll want to make your price comparisons on several different sites. But once you've done that then all you have to do is to choose the lowest price you've found and you're done!

Friday, February 13, 2009

How to Compare Savings Accounts

Savings accounts are where many people hang on to cash for future use – some people save for emergencies, vacations and travel, and the items they would like to buy someday when they have saved up enough money. People feel confident with their money in savings accounts, because they are insured by the Federal government and offer some growth over time.

If you're going to use a savings account to hang on to your money rather than just stuffing it in a shoe box under the bed, you should take a moment to compare different types of savings accounts in order to get the most out of your money.

Interest Rates

When looking at different savings accounts, take note of how much interest they will give you. The higher the interest rate, the better. Keep an eye out for savings accounts that charge different interest rates based on the amount of your balance – and consider how much you will typically maintain in your savings account to determine if you qualify for a higher interest rate or lower interest rate.


How easy do you want to have access to your money? If you're trying to save money without dipping into it, you may choose an account that doesn't have an ATM card, or that requires advance notice for withdrawing money, for example.

On the other hand, if you use your savings account to hold money that you use for your every day spending needs, you'll want to look at accounts that make it possible to withdraw your money instantly, and without penalty or fees.

Fees and Service Charges

Take a look at the fees and service charges that each of the savings accounts you are comparing charge. Some will charge a monthly service charge if your balance is below a minimum level – if you think you may not be able to maintain their minimum balance to avoid the monthly service charge, it's probably a good idea to look at a different account. Monthly service charges almost always cost more than the interest you'll earn.

If you tend to move your money between accounts, you'll want to make sure you won't be charged fees for transferring money. If you rarely move money between accounts that way, a fee for that service shouldn't deter you from an otherwise great savings account.

If you access money via an ATM, you'll want to make sure there are no fees for doing so if possible – or at least select a savings account with the lowest ATM fees.

Introductory Rates

Some savings accounts will give a promotional rate to encourage new customers to open accounts. A promotional rate may offer higher interest earnings for a certain, temporary period of time. If you are going to take advantage of a promotion – just be sure you understand the rates and fees of the account once the promotional period ends to determine if you'll keep your money with that account or if you'll start looking for a new savings account at the end of the promotional offer.

Graduated Interest Rates

If you know your savings will increase over time, you might want to look at savings accounts with graduated interest rates. This means you'll get higher interest with more money in the account, and lower interest with a lower balance.

Multiple Savings Accounts

Many people determine they need more than one savings account. Sometimes having a mix of savings accounts is better than trying to find a “one-size-fits-all” savings account for all of your saving needs. For example, you might have a long term savings for your future needs, an emergency fund for unexpected problems that might come up that require access to money, and another account for specific savings – like Christmas shopping or vacations.

Could You Use More Than One Savings Account?

Originally, savings accounts were created to give people a place to hang on to their money for the future, and to earn a little interest in exchange for doing it. It was a safer place to hold the money than under the mattress or in a box buried in the backyard, which is the type of savings people had before banks started offering savings accounts.

Savings accounts are still around to help people save their money and earn interest, but there is a greater variety of savings account options and many different reasons people open savings accounts. Many people have more than one savings account, designed to save for different uses.

Emergency Savings Accounts

Many people have set up savings accounts that are used for emergencies. It’s recommended that everyone establish an emergency account that has at least three months of living expenses in it; but for many people that is a challenge. Having an account that is designated for emergencies only is good even if you are unable to set it up with enough money to cover a full three months of expenses! For an emergency savings account, you want to be able to access the money when you need it – but you probably don’t want it to be so easy that you’ll be tempted to spend it in non-emergency situations.

Setting up an automatic deposit into your emergency fund helps you save a little at a time until you’ve reached your desired amount. Choose an account that allows a direct deposit or a bank transfer so you can quickly and easily move money into the account on a regular basis; and look for accounts that generate high interest so you can earn money on the balance you save until it’s needed for an emergency.

Christmas Club or Vacation Savings

Another type of savings account that many people set up is one to save for their holiday needs or to take a vacation. It’s a good idea to keep this money separate from your emergency savings, because you will be tempted to take your vacation as soon as there is enough money in the savings account and you’ll wipe out your emergency funds!

Some banks offer accounts that are specifically designed for holiday club savings or vacation savings – and may offer special perks for saving in these categories. You can use any savings account that meets your needs, however. Once again, since you’ll be leaving the money in the account until you’re ready to do your holiday shopping or go on vacation – you’ll want to find accounts that help you earn interest on the balance you have. For vacations that may be planned a few years away, you may want to put a chunk of your savings into a certificate of deposit or money market that will increase your interest earnings for a certain period of time.

Long term/Retirement Savings

Another potential savings account people may open is meant to be a long term savings. Some parents open savings accounts to put money aside in case their children decide to go to college when they’re older, while most people with and without children try to set money aside to help support them when they retire.

Choosing high interest savings accounts while you build up a balance is ideal; and once you have enough money saved in this category to move into a certificate of deposit or fixed rate IRA, you can probably find higher interest earning accounts with those savings options over a standard savings account.

What is Debt Settlement and is it Right For You?

If you're seeking an alternative to bankruptcy due to excessive debt that you can't pay, you may be considering debt settlement. Settling your debt is when you negotiate with your creditors to lower the amount you owe. While there are a number of debt settlement companies that exist to help you get rid of your debt – you may be better off doing it on your own. There are many risks associated with using debt settlement companies, including outrageous fees for their services.

Why Do Creditors Agree to Settle?

Many creditors would rather accept less than what you owe than send you collection notice after collection notice in an attempt to recover what you owe them if you have fallen behind on your payments. A debt settlement is when a creditor accepts 20-75% of what you owe in a one-time payment and then forgives the rest of the debt owed. They will then report to credit bureaus that the amount owed has been “settled”. The history of delinquent payments and charge-offs that may have occurred on the settled account prior to the pay-off date will remain on your credit report.

Creditors are not likely to agree to settlement options if consumers are up to date with their payments. Many won't talk to you about settlements unless you are three to six months behind on payments – and have been unresponsive to debt collection attempts. This means you'll spend three to six months screening your calls and not paying anything toward the debts you hope to settle on. During those three to six months, you would put as much money aside as possible to use to pay the company off when they agree to settle.... IF they agree to settle! There are no guarantees that a creditor will agree to settle, and you do take the chance that after not paying them for three to six months, possibly lowering your credit score even more, the creditor will refuse to settle.

Debt Settlement Companies

A number of companies exist nationwide to help consumers settle with their creditors. As the economy continues to weaken, even more debt settlement companies are popping up in hopes of getting business from the large percentage of Americans who are struggling under excessive debt.

The problem with debt settlement companies is that they often charge excessive fees for their services, and you probably won't know up front how much you'll actually pay for the service. Some companies charge 15-20% of your total debt, plus an initial sign-up fee and ongoing monthly service charges. Some companies charge a monthly service fee instead of a percentage of your debt.

The companies are supposed to be able to help you negotiate with your creditors. Many people who have worked with debt settlement companies have reported that they weren't able to get all creditors to negotiate the amount owed. You're required to set up an escrow account when you use most debt settlement companies, and this is where your service fees, sign up fee, and/or monthly fee, as well as the monthly amount you are paying the debt settlement company to pay your creditors with, is deposited each month. It's also where the debt settlement company withdraws their fees. Some consumers have reported over a two year period that they made their monthly required payments under the debt settlement plan to the company, and the only payments to come out of that escrow account were those made to the debt settlement company. Meanwhile, the consumers continue to get phone calls and debt collection notices from creditors looking for their money – because nothing has been settled during this time.

Some creditors will escalate the accounts if they realize you are working with a debt settlement company – which means they may send your account to a collections agency sooner than they would have otherwise, or attempt to sue you. If a creditor takes legal action, most debt settlement companies will drop your account because they don't have the ability to represent you in court or give legal advice.

Should You Attempt to Settle Your Debts?

Debt settlement is only a good option for people who are heading toward a bankruptcy but don't qualify for filing Chapter 7. In a Chapter 7 bankruptcy, most unsecured debts are written off but you may sell your home or other property). If you qualify for a Chapter 7, chances are you don't have the cashflow available to make a debt settlement option work for you, since it requires paying a percentage of your debts back to “settle” them and close the accounts.

If you are able to scrape together enough money to pay your debts through a debt-management program, where you are working to pay off all of your debt under lower interest rates – then by all means choose that option over debt settlement. It's better for your credit score.

If you've been pretty good about keeping up with your debts, you'd have to allow your accounts to go three to six months late before a creditor would consider you for debt settlement. If your credit score is reasonable now, you would completely damage it by going with a debt settlement.

3 Basic Principles For Good Personal Finance Habits

There are three basic principles surrounding good personal finance habits, and they are:

* Live Within Your Means by Spending Less Than You Make
* Making the Money You Do Have Work More For You
* Anticipating and Preparing for the “Unexpected”

Living Within Your Means

Everyone talks about living within your means, which simply means that you spend less than you make, you avoid excessive debt and you save money. The concept is easy to understand, but judging by the number of people who spend more than they have – not so easy to apply!

Living within your means involves knowing where your money is going for the everyday spending – but it also applies to the big life purchases, like buying a house or renting, the decision to have (or not to have) children, deciding your location, and what kind of car to drive.

Making Your Money Work More For You

Making small changes can maximize your savings without having to modify your lifestyle much. For instance, if you have good financial discipline, it may make sense to use a rewards credit card for every purchase and payment during the month. Paying it back in full at the end of each month means you have a 30-day interest free loan every month, you earn more rewards from the credit card company, and it's easier to see where your money goes each month when you view your transaction records.

Upgrading your bank account to one with higher interest or no fees can make or save you a lot of money over time. Try to invest money in accounts that will give you the most interest for the length of time you're able to leave the money untouched in the savings and watch the magic of compounding interest. Get into the habit of paying yourself first, automatically – every single pay period.

Check over your existing bills carefully and look for ways to save money – typical expenses that people pay too much for include cable television, phone and cell phone service, and utility bills.

Anticipating and Preparing for the Unexpected

Many people claim not to have money to repair their vehicles when it breaks down because it was “unexpected”. When the furnace in the house dies and requires replacing or maintenance – people claim it was unexpected and therefore they don't have the money to take care of it.

While we may not know exactly when these events will occur- we know that these types of “unexpected” events DO occur, without fail. So they aren't really “unexpected”.

Anticipate and prepare for these events by setting up an emergency fund. This is an account that gives you a way to keep going and stay on your feet when disaster happens. If you can, set aside three months of living expenses, but if you aren't there yet- just keep putting aside as much as you can into your emergency fund until you reach that number.

It's important to recognize the emergency fund is separate from your savings account – it's not used for vacations and it's not used for investments. Your emergency fund is meant for all of those “I didn't know it was going to happen” type events that typically lead people to take out loans, use credit cards, or borrow from friends or family.

Save money for your emergency fund in an account that you can access as needed – but in one that will also earn interest to better maximize your money.

Make Your Own Debt Reduction Plan

As an increasing number of people are finding themselves in over their heads in debt, many are turning to various debt management programs for assistance. Before you sign on to one of these programs, you might try to make your own debt reduction plan – and save yourself having to pay a company fees for their services, or avoid the trouble of potentially dealing with a dishonest company.

Step One: How Bad Is The Situation?

Before you can honestly make a go at paying off debt, you need to have accurate knowledge of how much debt you have. Get out your checkbook register, bank statements, credit card statements and anything else you use to track your finances and see if you can pull together a complete list of debt. Include the name of the creditor or person you owe, how much you owe them, what the minimum payment is, and how much the interest is.

Make a second list of other financial obligations each month – your rent or mortgage, utilities, etc. This way you can see how much money you're paying out versus how much you're receiving. If your income isn't greater than the minimum payments and living expenses on your list, you know you're in a really bad situation. If the income is the same or greater than what you owe – the situation is troublesome but probably not as bad as you thought.

Either way – making your own debt reduction plan is a good place to start digging yourself out of this hole. If after you try this with 100% commitment you find you still can't make any headway in reducing debt, you might want to consider other options (debt management companies or a debt consolidation loan, for example).

Step Two: Call your Creditors

This step can be challenging and it's the reason many people feel working with a debt management company is helpful because they will actually try to negotiate on your behalf. What you may not realize is they don't have much more pull in getting lower interest rates are different repayment terms than you do on your own.

There is nothing stopping you from calling each of your credit card companies and explaining your situation. Right now, they are likely to be getting a lot of calls from people trying to do the same thing, so it may be more difficult than ever but you won't know if you don't try! Ask for a lower interest rate for a period of six or twelve months, to help you pay down your debt faster; or ask for any other payment arrangement that helps more of your money go to the principal balance to enable you to get out of debt. You may be pleasantly surprised at the offer you receive – if the customer service representative tells you there is nothing they can do, don't just say thank you and hang up! They are reading from a “what to say when the customer asks...” type of script, so be sure to ask to be transferred to the supervisor and be persistent (yet polite).

Step Three: Work Out a Repayment Plan

You have to be committed. You have to be serious about wanting to get rid of the debt, or you may as well stop right here because you aren't going to get anywhere if you start a debt reduction plan and quit a week later. You can't approach it like a diet that you start before Thanksgiving and quit because you want to eat two helpings of Thanksgiving dinner.. start back up afterwards and quit for Christmas and New Year. It probably took you a few years to get into serious debt, and unless you win the lottery or are handed a ton of cash, it's going to take discipline and time to get out of it.

Look at your lists and see where your money is going right now. First of all, eliminate all unnecessary expenses (coffee on the way to work, picking up extra groceries on a whim when shopping for meals, eating in restaurants or take-out, buying books when you can go to the library, etc). Change your list to reflect new interest rates or minimum payments you maybe succeeded in arranging from doing Step Two.

After subtracting your required living expenses from your income (your rent, your utilities, your gasoline, car insurance, etc), take the amount you have left and decide how to allocate it to your debts to pay them off. You can use a “debt snowball” to do this. The key is to pay the minimum payment on all debts except for one; which you send as much money as possible month after month until it is paid off. Once the account is paid off, you send the money you had been sending to it on to the next account on your list (added to the minimum payment you were already sending). As you pay off accounts your payments get bigger to each of the accounts on your debt list, which accelerates repayment.

When you use a debt management company, often you are required to stop making payments on some or all of your accounts in order to get them three months (or more) past due just to get the company to work with you. In some cases, you may already be this far behind and the option for using a debt management company may be a good one. If you aren't quite that behind on your debt, you can work out better repayment terms and become disciplined with your finances without having to damage your credit score further or make payments to a debt management company.

Learn What Credit Insurance Can Do For You

Almost every time you make major or smaller purchases you apply for some type of credit. No matter if you are buying a house or a car, or you just go and buy some appliances or electronics for your home you’ll use some type of credit. And more or less every time you use a form of loan there are big chances that you’ll be asked to also buy some form of insurance for your credit. Before proceeding with buying any kind of insurance you should know what you’re paying for. Credit insurance is a type of insurance made on a debtor in favor of a lender and it is intended to pay off a loan or the remaining balance if the insured dies or is unable to make any more payments. The insurance for credits comes in various forms; the typical form includes credit life, credit property insurance, credit disability and involuntary unemployment. Usually all these coverages come all together with the same credit insurance. Some of them will have a value for you and some may not have. You can opt for which one of them you want to pay with one small exception: credit disability and life coverage cannot be sold separately.

Credit life coverage is actually a type of life insurance that pays off the loan or the remaining balance in case you die. The payment of the life credit insurance on this type of insurance for the credit always goes to the lender as he is the beneficiary of your policy. The credit disability insurance is the type of insurance that makes your monthly credit payments during a certain fixed period of documented medical disability. While this type of insurance can help you keep a good credit report and history, it will not make the monthly payment forever and will not, for sure, pay off all your balance. In such situations it is best to try to get back on your feet and pay by yourself the loan because, as the time passes, interest and insurance charges continue to add up to your already existing balance and you’ll end up paying more than your original credit.

The other two types of credit insurance are: involuntary unemployment insurance and credit property insurance. The involuntary unemployment insurance is very much similar to the disability insurance: the insurance makes the monthly minimum payments for a certain period of time while you are involuntary unemployed. Like we said before is better to not let this situation go on for a long period of time. The credit property insurance is different than all the other insurances in the way that it cancels the debt you owe for the items purchased if the property purchased is destroyed by certain specified risks like: fire, flood, accident, earthquake, etc.

No matter for which one of the above credit insurance you opt, it is most important to read and know the full details of the coverage. This way you’ll be able to know which one of them best suites your needs and select that particular one or maybe a combination of two or more of them. Also, you should consider your financial status before purchasing insurance for the credit. Or maybe you’re considering making several purchases from different places and each one of them asks for insurance. But this cannot be so cost effective. If you have more accounts and intend to insure all off them maybe you should think of buying a traditional insurance; an insurance agent or broker can be of big help in such a situation. He will help you make the necessary comparisons and finally with choosing the right insurance type for you.

Last but not least you have to make sure you qualify for the credit insurance you’re going to buy. These types of insurances are sold without any screening to anyone that makes a purchase on credit. Often, many people do not qualify for the insurance they are buying but the company that is selling you the insurance will not bother asking you if you think you qualify or not. So, it is you, the borrower and the buyer of the insures, that has to carefully read and understand how the insurance works and be fully aware of any special claim procedures or limitation clauses included into the insurance. It is only your responsibility.