Student Loans – Student loans – Student loans - this a hot topic in the news today. As it is every time we are appoaching and election year. OBama’ Student loan plan is what we all have been waiting for, right? Well, probably not. The student loan bill that is being proposed is really nothing new just a spin on an old program.
Obama’s Student Loan Program
Mark Levin, a constitutional attorney and conservative talk show host, quotes Michelle Singletary, a writer for the Washingon Post. (http://marklevinshow.com/goout.asp?u=http://www.washingtonpost.com/business/economy/obamas-student-loan-plan-isnt-so-new/2011/10/26/gIQA9a4RJM_story.html)
Review Michelle Singletary’s article and then do some additional research to see if the proposed plan is going to help you in anyway. The fact is that most of the people that are currently in the work force will not benefit from this plan.
Please don’t be fooled by the campaign rhetoric. We all understand that if we take out of loan that we are agreeing to pay it back! That is the definition of the word loan. So with that said – if you are a student that thinks otherwise then you should stop reading this post and probably continue the “Occupy” movement.
You have a choice
A student loan is just that – a loan to a student. This great country we live in allows us the opportunity for an education. With that opportunity comes a price, like all opportunity cost. Sometimes you might have to take out a student loan; sometimes you might have to scrimp and save to go through school; sometimes you might have to do both; you might have to WORK! The opportunity to have an education rest on us. We are not force to go to school or take out a loan -we do it to better our situation.
This could be a benefit to some of you but mostly likely if you are already in the work force or you took out your loans prior to 2008 then this bill will not really effect you. It is political speech- geared to get the young vote. Student Loans, Student debt, cost of student loans, fees of student loans - these are just keywords to get the students to tune it. So students tune in - if you need to get a student loan to go through school and help your earning potential then do it… If you can find the right loans that meet your criteria then it might be a good thing. Here in America you have a choice and you are the one ultimately responsible for that choice – including being responsible for any loan you may take out 
. Take control of your dreams and use the resources along the way if they are going to help.
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The Fee War
The Fee war is heating up again!!! Debit cards vs Credit Cards. I thought we were in a double dip recession (or as some have been calling it a depression). Well for many that may feel true but not for the big banks. Wells Fargo reported record profits just recently… How are they doing it ? If the real estate market is struggling so bad? The American’s are spending less? We are in a recession… right… If you want to know the secret keep reading.
IT IS THE FEES
Banks live and die by fees- check fees; atm fees; interchange fees; business fees; non sufficient fund fees, credit card fees and debit card fees. The Federal Reserve starting in October 2011 restricted what banks can make on Debit Card fees; the Federal Reserve put a cap on the fee at 21 cents per transaction, down from and average of .44 cents per transactions.
Banks have reacted by developing new fees and charges for consumers for using their debit cards. Instead of a per transaction fee, which they will still probably charge, they are introducing the all-new monthly fee. Wells Fargo is currently testing a $3 a month fee for using your debit card. Bank of America is a little more aggressive charging a $5 fee to use their debit card. Other banks are doing the same thing but these are the biggest in the news… – Hmmmm…. WAIT a second !!! Don’t debit cards just access my own money and account at the bank? HUH weird.
Record profits
Get this Wells Fargo said it earned $3.8 billion in the third quarter for its common shareholders up from $3.1 billion from the same quarter last year. Ouch the depression is hurting these guys!!! Have you ever heard the saying, “The nickels and dimes add up? “ Well in this case you can see a penny here, a nickel there, etc… ads up to $3.8 billion dollars in a recession. So the debit cards – per use fee has been restricted but remember banks live and die by the fees so – watch closely because you are going to get new fees or a jumps in old fees.
Did you know?
There are over 600 MILLION credit cards held by U.S. consumers.
It is said that the average consumer has 3 credit cards, Salt Lake City, Utah residents too!
The average interest rate on a credit card today is just over 14%.
Recent reports are showing that consumer credit card debt has increased while delinquency rates have decreased significantly, Salt Lake City included.
Odd how credit card debt can increase yet delinquency rates can decrease, or so you may think.
Try thinking of it this way; times are tough and the economy has suffered a hit Banks and lenders aren’t offering credit as easily as they used to, whether it is for a credit card or a simple loan. Lending standards have become stricter. Consumers that can still get approved for credit cards are more likely to pay their bill. Credit card delinquency decreases.
Now, on the flip side, demands on the consumer have increased. Job layoffs and unemployment rates are high. Salt Lake City has an unemployment rate of about 7% right now. Consumers are using their Visa, MasterCard, Discover or American Express credit cards to pay for necessities while they are out of jobs or are tight on money. Therefore, credit card debt increases.
So what can you, as the consumer do to make sure you are getting the best deals on the credit card offers you’re seeking?
Research, research, research. We, as consumers, are always looking for the best deals we can find. Why should it be any different when it comes to our credit cards? There are MANY different cards out there. Do your research! Sometimes we can find a credit card that will offer no annual fees with a slightly higher interest rate. Sometimes there are cards that have annual fees but offer a lower interest rates.
An example: Currently, in Salt Lake City you can get a MasterCard with no annual fee and a 0% introductory rate for the first 7 billing cycles and then your interest rate can be as low as 12.99% thereafter. On the other hand, you can get a MasterCard that has an annual fee between $35-$79 and the interest rates can be as low as 7.90%. The question is, which credit card will be best for you; a MasterCard with no annual fee or a MasterCard with an annual fee?
Think about convenience. If you are using the card for travel, who is most accepted in the area you are traveling? MasterCard and Visa are the top two accepted credit cards in Salt Lake City and the rest of the United States as well.
Try to find credit cards with perks that will benefit you. Visa, MasterCard, Discover and even American Express often have credit cards with different reward programs. Compare the cards that peak your interest to find the best deal that suites you best. All sorts of reward cards are out there for credit accounts. Anything from 0% introductory rates to gas rewards to cash back rewards. Remember, no annual fee credit cards can be a perk too!
Do your research and compare credit card offers. Whether you end up with an American Express card or a MasterCard, an annual fee or no annual fee, cash back rewards or gas rewards… the most important thing is what is best for you!
Credit cards are a big part of life -whether you live in a small community like Salt Lake City or a big metropolitan like New York. Credit cards are used to buy online; pay for dinner; taxi; hotel reservations; and tuition. We use them to buy things for the benefits, the convenience of not carrying cash, the safety of having a paper trail, insurance, reward points, and or sky miles. Credit Cards are a great tool and they provide a ton of benefits in today’s society.
For the first time in decades, across the country from Los Angles, Salt Lake City, to New York individual consumer trends are showing consumers are trying to save a little more money. Well, credit card companies don’t make profits unless the consumer uses the credit extended to them. So, credit cards companies are using the marketing data to help them understand and craft advertising that is appealing to specific markets.
For example, lets say that the trend in Utah is for the consumer to pull back on spending or they are trying to pay off debt. That data might result in advertising such us “Salt Lake City no annual fees credit cards”; “O % balance transfer”; “low interest rates for debt consolidation”.
Regardless of what advertising draws you in – make sure you understand the credit cards terms and conditions to determine if the card is right for you. A no annual fee credit card simple means their is no annual fee to have the card. That doesn’t do much for you if you need a credit card with O% balance transfers because you need to consolidate debt… or maybe you need a low interest rate loan and you don’t mind paying your hard earned cash on a small annual fee.
Searching the Internet and various card company websites we have found many cards with no annual fees. Use credit wisely continues to save and reduce your debt but in today’s world it is a good idea to have some credit available to you. As we have compared cards with no annual fee we have found the following cards to be consumer friendly:
*Discover More Card -
*Chase Freedom Visa
*Discover Open Road (SM) Card
There are hundreds of credit card offers and they change all the time, so do your own research and be responsible for your own evaluations. Discover is a great company and they have great programs, but they are not as widely accepted VISA, MASTERCARD, and AMERICAN EXPRESS especially if you are traveling internationally. Because of that and various other reasons you might want to also get an additional card branded with Visa, MasterCard, and or American Express.
Being financially savvy means that you understand some of the rules that govern finances. Let’s look at a story to illustrate this principle –
Bill’s Story
Bill, a money wise New York man, goes into one of the most prestigious New York banks and asks the loan officer if he can have a loan for $5,000 for one month… and he would secure his the loan with his Lamborghini. The loan officer was thinking, “this man is crazy Lamborghini’s are worth hundreds of thousands of dollars”– this loans would be the best secured loan that he had done all year. His boss was going to be proud of him. The loan officer quickly looked up Bill’s credit and called his other bank references and found out that Bill had millions of dollars in his account at another bank. The loan officer couldn’t help but squeaks out, “Sir, I don’t understand- you have millions of dollars in your bank account and you want a $5,000 loan from us just for one month… Why?” Bill turned to the loan officer and said, “if I get a loan from you and I secure it with my Lamborghini – you guys are going to take my Lamborghini and put it in your underground parking … right?” The Loan officer said, “Right” Bill continued, “Well, I am leaving town for a month and won’t be driving my car – and when I get back I will give back the loan of $5,000 you lent me plus interest for one month which comes out to be $33.33 at … Now son you tell me where you can find a secure parking spot for just $33.33 in New York for one 1 month?”
Now that is supplementing your income with credit!!! The story above is a perfect example of how supplementing your income with credit can be done and when performed correctly it makes things possible that otherwise wouldn’t be. Bill took a loan out for $5,000 for 1 month and was willing to pay interest on it because the benefit he received was better then the alternative (leaving the car out on the street or paying an exorbitant fee to have someone watch over his car). Because he understood how money and credit worked he was able to securely store his car at one of the best locations, and was sure that no damage would be done to his car in the mean time or the bank would be destroying its own collateral. He was willing to use short-term credit because he understood what it could provide to him. Can you see how supplementing your income with credit, credit cards, and the right loans can help you? How could you get more control of your finances by using credit cards to provide you with short-term loans? What are the benefits?
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Credit Cards and Debt is something most Americans struggle with. It is real easy to get credit but it is very hard to get out of it once you have gotten in. When you turn 18 you have 3-5 credit card applications coming to your house a week. Most 18 year olds are just starting their life and don’t have much in the way of income but yet the credit card companies are willing to give us CREDIT – they have also promoted the industry so well that we think we have to have credit to buy certain things and the fact is anymore that is probably true unless you are really creative, and patience.
Why do they do it? Because they know if you can satisfy the desires for the things you want now you will give them the things they want in the future YOUR PAYMENTS PLUS INTEREST!!! Sounds like a good trade on the surface and in fact they are great to have if you are disciplined with them. So for most people they are not disciplined and the credit card company turns the people into payment machines for life. Here is a little story to illustrate the point : A doctor went on a bike riding trip with a few buddies – all of them very well off financially. Well a few days into the trip one of the guys said, “Hey why don’t we extend the trip 2 more days and do this one last trail. A couple of guys said that would be great made a few phone calls and said they were in. The Doctor said I can’t I don’t get paid unless I am there to see patients. Then he turned to a couple of the other guys and said, “Don’t you have to go back? “ and they replied,” No we get the payments whether we are there are not.” It is all about the payments.
The Credit card companies know this well. The Credit card companies know that they provide a service – to allow people to buy things now in return for the payments!!! Are the credit cards and the credit card companies bad – no the products or the companies are not inherently bad they are just a tool. It is us that need to learn how to use the tools to our advantage. Credit is not a bad thing in fact it allows most economic systems to flow freely we just need to understand how to the tools to our advantage.
It has been said that the stress of getting a home loan or buying a house is 2nd to death or public speaking to some. To make the process easier and less stressful, there are a number of wonderful tools. One of those tools is a free mortgage calculator. These simple straightforward tools allow you to quickly and easily compare loans and interest rates, compute potential savings, payment amounts and a variety of other financial formulas. Best of all it helps you make informed decisions as to what is the right loan for you. Which calculator should you use? Well, that all depends on what type of loans you are looking for. Below are a number of different types of Mortgage Calculators.
Home Purchase Calculators
First-time home buyers can use the calculator to help them decide whether it is better for them to rent or if they can buy and invest into home-ownership. Often times renters are amazed when they see the numbers and realize it might be cheaper for them to invest in a home. The free mortgage calculator is simple to use just put in the information that it asks you and out comes the monthly payment. Knowing the monthly numbers is vital to making an informed and smart decision. It is better to know right up front how much “house” you can afford then to find out 3 months after that you are struggling to “afford” the house.. Nobody likes being house poor. The free mortgage calculator allows you to know how much you can qualify for and then you decide on how much you can afford and still be comfortable. Whether you are an “Empty Nester” buying a 2nd home or a first time buyer using a free mortgage calculator is a smart idea.
Refinance Calculators
If you already own a home and you want to take advantage of lower interest rates, debt consolidation, or just want to stop paying that annoying mortgage insurance you might want to refinance your current loan. A free mortgage calculator can help you to determine the cost to refinance, the new monthly payment, how your mortgage payments are amortized over the life of the loan, or calculate the mortgage balance.
Home Equity Calculator
Home Equity or the amount of Equity (ownership) you have in your home. For example if your home is worth $200,000 and you have a mortgage of $150,000 then you take what your home is worth ($200,000) and subtract the mortgage ($150,000) to give you $50,000 of Equity in your home. A Free mortgage calculator is indispensable when shopping for home equity loans – loans or lines of credit against the equity in the home. Sometimes these are called credit lines (CL), home equity lines of credit (HELOC), Home Equity Credit Line (HECL). Often, people will use home equity lines of credit to consolidate credit card debt – so they have 1 monthly payment and also in some cases can right off the interest they pay on the home equity line of credit because the IRS (internal Revenue Service) allows you in certain circumstances to right off the interest payments you pay on your house.
Always consult a professional before making big financial decisions. Free mortgage calculators are great, but keep in mind they are no substitute for consulting a live loan expert.
