Personal Financial Tips

Archive for July, 2011

Know somebody whose birthday is coming up and you need to buy them a gift? Or, maybe you need to buy someone a congratulations, graduation, thank you, or special holiday gift. It can be hard to know exactly what to buy that special person.

Gift-giving is not as easy as one might expect. You would think it would be a cinch, what with the thousands of products and services available online or in nearby department stores. In reality, though, the more choices you have, the harder shopping becomes.

Compounding the problem is that, in the modern era of instant gratification, most people of any means at all will just go out and buy what they want or need. Translation: anything you could buy this person that they would actually want – they likely already have.

Traditionally, the solution to the problem of what to give someone as a gift has been solved by giving the gift of cash. Stuffing a midsize or large bill into an envelope with a card has been a socially-accepted way of giving gifts for decades. Trouble is: it’s a bit boring and uncreative.

So, what can you do if you are stuck between the inability to choose amongst a million products on the one hand and the choice to give boring old cash on the other? Answer: give them a debit gift card.

Debit gift cards are simply pre-paid cards that carry the symbol of a major credit card issuer like Visa, American Express, or MasterCard. The recipient uses them just like a credit card, right up to the denomination or value with which it was originally loaded.

If you are considering buying a debit gift card, here are 5 reasons they are better than giving products or cash:

1. Safer than giving cash:

Cash can get lost or stolen. But, with a prepaid debit card, if it is lost, the recipient can choose to immediately call in the card number to get the card frozen from making future purchases. You can’t do that with cash!

2. Debit cards are more fun to receive than cash:

When it comes to gifts, receiving a prepaid gift card feels a lot more exciting than just getting cash. It gives the impression that you put some extra forethought into the gift, rather than just pulling some cash out of your wallet and sticking it into an envelope. Plus, unless you went to the trouble of getting them a crisp, new bill from the bank: cash is just plain dirty – quite literally.

3. Offers protection against damage or loss of purchased items:

Most prepaid debit gift cards come with product purchase protection. This means that, if the recipient should make a purchase of certain goods and they get lost due to theft or are damaged within 90 days, the issuer will cover the replacement costs. (Check your card’s policy for details before buying).

4. No need to run a credit report or apply:

Of course, to use a traditional debit card you need a bank account, and to use a credit card you must go through a lengthy credit application. Not so with prepaid gift cards! You can buy one over the counter or online and have it shipped directly to the recipient.

5. They can check their balance online or by phone anytime:

If the recipient needs to know their balance, they can check anytime by calling the phone number provided with the card. The same number can also be used to report the card if it is stolen.

Consider these 5 benefits of giving someone a prepaid debit card as gift instead of products or cash.

Many motorists have proven that gas cards save or stretch gas money. However, there are still those that do not understand how gas cards work and are easily discouraged when they do not get their rebates upfront. Earning gas savings actually requires a little patience and time.

Gas savings or rebates are not earned upfront specifically when you use gas credit cards. Rebates are accumulated in the form of rewards points. These points can either be redeemed at month end or when they reach a predetermined amount. But either way, your rebates will be converted into cash after a certain period of time, usually a month or so. There may also be some companies that may require that you request to redeem rewards points. These companies are usually those that offer varied forms of rewards and the request may include the form of reward that you want. Also, there are some that carry expiration dates on redeeming rewards. So it will be best to read the card’s fine print so you won’t think that you did not earn gas savings from your gas card.

Basically, the amount of savings that you earn from your gas cards is based on the percentage rebate. Current rebates on the gas card market are from 2% to 5% during regular periods and 10% during introductory periods. Some may also offer 2% rebate or more for non gas purchases. However, the savings that you earn is not limited to this rate. You can actually earn more. For instance, if you use gas cards to buy prepaid or gift gas cards at gasoline stations or you use cash backs for gas purchases only.

Indeed, you save a lot on gas money by using gas cards. Explore your gas card options well and read the fine print so you don’t miss out on your savings.

Homeowners insurance covers damages resulting from most kinds of natural calamities. If a third party lender finances a home, it becomes important to obtain homeowners insurance, in order to cover the building and the material possessions inside.

Homeowners insurance is a package policy: This means that homeowners insurance takes care of both, the damage caused to the home, and the legal responsibilities involved. Homeowners insurance can also be used to protect the homeowner against injuries or property damage caused to other people, by the owner or his/her family members. This includes injury caused by household pets.

Homeowners insurance covers damage caused by most disasters except floods, earthquakes, and the lack of maintenance. Individuals are required to buy separate policies to cover the losses incurred due to earthquakes and floods. Maintenance related damage is not covered by any insurance policy.

Types of Homeowners Insurance

Following are the four types of coverage included in the standard homeowners insurance policy: -

Coverage For The Structures

This policy pays for repairing or re-building the house if it gets damaged because of fire, hail, lightning, hurricane, damage caused by vehicle or aircraft, explosion, windstorm or other disasters, according to the formulation of the policy. Most of the standard policies also deal with structures that are not attached to the house, like the garage or a gazebo.

Coverage For Contents Of Home

This policy covers personal belongings such as furniture, clothes, electronic goods and other household items that get destroyed by any of the insured disasters. Most companies offer coverage of 50% to 70% of the amount insured for the building. For example, if a homeowner has $200,000 worth of insurance on building structure, then he/she would have $100,000 to $140,000 worth of coverage on the personal belongings. The best way to find out whether this coverage is adequate is to carry out a home inventory, which includes the original cost of each item.

Protection Against Liability

This covers against lawsuits for any physical injury or property damage that the homeowner, or his/her family members, or pets cause other people. This liability policy covers a homeowner anywhere in the world. For example, if a homeowner’s children, or dog, or any other pet accidentally damages the neighbor’s furniture, or expensive carpet, or any other property, the homeowner is covered by this policy. But the homeowner’s own property is not covered by this policy, if the children or pets damage it similarly. Liability coverage generally starts at $100,000.

Additional Living Expenses Under Conditions The Homeowner Is Not Able To Live In The Home:

This policy pays for the additional cost of living away from home if it gets damaged by fire, lightning, hail, smoke, theft, storm, volcanic eruption or any other insured disaster. It covers restaurant bills, hotel bills and additional living expenses incurred while the home is being repaired. Generally, companies provide coverage for about 20% of the insurance on the structure of the house.

For example, if a homeowner has insurance worth of $100,000 on the structure of his/her house, then the additional living expenses coverage in case of damage will be 20% of $100,000, which is $20,000. This policy also reimburses the rent amount if a part of the damaged house had been on rent.

For most people, a home involves a large investment. Insuring it against damage due to some unforeseen calamity can protect you from bearing the burden of such losses.

Often, finding all the documents at one place is difficult and this becomes painful especially when you have to dispatch them for an instant loan. In the loan market, however, to combat such a situation, you have an option of getting payday loans without having to fax any papers at the time of making the application. This implies that you will get the money within 24 hours in your bank account without having the papers ready in your hands.

You do not have to fax proves of your salary, employment, residence, bank statements and so on. This means that there is no stress on you while making the loan application. If the lender asks the documents later, you can send them as you have arranged them by that time.

Under payday loans, you can borrow an amount depending on your monthly salary as these are made to people who are employed for at least past six months. Usually, the loan ranges from 100 to 1500 for an approval of two weeks only. This implies that you will repay it at your next salary time. These are unsecured loans, without any security offer to the lender.

However, you should be prepared for making high fee payments on each 100 borrowed. Obviously these high cost loans are meant for urgency only.

The loan approval usually comes without any credit checks. This means that people with history of payment faults like late payments, defaults, arrears and CCJs are approved with ease. Thus, they have an opportunity for improving their credit rating shortly.

In order to avail payday loans no fax at comparatively lower fee of the lenders, compare them on internet as there are plenty of such offers there. Ensure that you do not have to extend the loan as it makes the repayment highly burdensome.

Gas cards have been proven to stretch gas money and using them is a good way to augment the ever-increasing gas prices. Basically, there are two types of gas cards: prepaid and gas credit cards.

Gas credit cards work the same way as ordinary credit cards, only that you earn rebates when used for gas purchases. During introductory periods, you can earn as much as 10% rebates on gas purchases. On regular periods on the other hand, you earn rebates from 2% to 5%, depending on the card company. The rebates are not always earned upfront but are accumulated in the form of rewards points. And once these points reach the redeemable amount set by the card company, they are converted into either cash back, airline tickets or gift certificates. The cash back reward however is preferable since it can be used to pay for gas purchases.

Prepaid gas cards on the other hand, works almost the same way as gas credit cards only that there is a limit to the amount you can use it for. Basically, you set the amount limit that the card can be used for by paying for it upfront; this is why it is called prepaid.

When you search for gas cards, you basically have to make a choice between the two types. Which one is better? There is no definite answer since your choice will depend on your gas spending habit. If you need help controlling your gas expenses, then prepaid gas cards are preferable. However, in instances when you loose your gas cards, gas credit cards are preferable since the balance on prepaid cards is unrecoverable. Also, using gas credit cards will help improve your credit score or your credit history provided that you are vigilant in paying your bill on time and in full.

When applying for a home equity loan, keep in mind that like most loans, there are always a host of fees. Usually the interest rates for this type of loan are much lower than those of a credit card which is a plus but be sure you understand all costs that will be associated with the loan before you sign on the line.

The main cost to consider is the interest rate. Different types of home equity loans come with different types interest rates. If you are getting a closed home equity loan, which is a single loan, it traditionally will have a fixed interest rate. If you are considering a home equity line of credit, know that it usually will have a variable interest rate. The two types of loans are quite different so expect a discrepancy in the rate of interest for each.

With the home equity line of credit, often every time you borrow from that line, you may be asked to pay a transaction fee. But with all fees, it never hurts to ask for them to be waived or reduced. Often lenders waive certain fees as an incentive to use their company. So do your research!

Both of these loans are treated much like a mortgage. So like your initial home loan, expect that you will have closing costs, attorney fees (if they prepare the legal documents) and insurance fees to pay. You’ll more than likely also encounter an appraisal fee. It’s usually required to have an official home value established before the loan amount can be properly determined. Just keep these all in mind when deciding on whether or not getting a home equity loan is right for you.

Unfortunately, fees are a necessary evil when it comes to getting any type of loan so be prepared to analyze the whole picture. There’s always more to consider than just your monthly payment. And since it’s your home you are putting on the line, it’s so important to understand every fee that will ultimately be associated with the loan. There are so many options out there for home owners. Just be a savvy consumer and get all the information before committing to anything.