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Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | What is the equation for an inflation adjusted annuity held in perpetuity? | Let P denote the amount of the investment, R the rate of return and I the rate of inflation. For simplicity, assume that the payment p is made annually right after the return has been earned. Thus, at the end if the year, the investment P has increased to P*(1+R) and p is returned as the annuity payment. If I = 0, th... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | What is the equation for an inflation adjusted annuity held in perpetuity? | EDIT: After reading one of the comments on the original question, I realized that there is a much more intuitive way to think about this. If you look at it as a standard PV calculation and hold each of the cashflows constant. Really what's happening is that because of inflation the discount rate isn't the full value of... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | What is the equation for an inflation adjusted annuity held in perpetuity? | The question lacks specificity, i.e. when does the initial investment occur, now or one period from now? If now then it is a perpetuity due. I will consider under 2 scenarios, A and B, relating to the size of the initial investment. A. Assuming that the initial investment (C_0) occurs now and each payment thereafte... |
Share your insights or perspective on the financial matter presented in the input. | What's a reliable way for a non-permanent resident alien in the USA to get an auto loan? | I don't think that they ask you for your citizenship status when you apply in a dealership. At least I don't remember being asked. I know of at least 3 people from my closest circle of friends who are in various immigration statuses (including one on F1) and got an auto loan from a dealership without a problem and with... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | What's a reliable way for a non-permanent resident alien in the USA to get an auto loan? | I took @littleadv 's recommendation that online apps only ask for citizenship due to post-9/11 legislation. I applied to 2 banks in person (one big, one small), and at the dealership. None of my in-person applications ever touched on the issue of citizenship. I even applied in person at the same bank that insta-rejec... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | What's a reliable way for a non-permanent resident alien in the USA to get an auto loan? | You have figured out most of the answers for yourself and there is not much more that can be said. From a lender's viewpoint, non-immigrant students applying for car loans are not very good risks because they are going to graduate in a short time (maybe less than the loan duration which is typically three years or mor... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | What's a reliable way for a non-permanent resident alien in the USA to get an auto loan? | From personal experience (I financed a new car from the dealer/manufacturer within weeks of graduating, still on an F1-OPT): |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | To use a line of credit or withdraw from savings | No one can really answer this for you. It is a matter of personal preference and the details of your situation. There are some really smart people on here, when placed in your exact situation, would do completely different things. Personal finance is overall, personal. If it was me, I'd never borrow money in retirem... |
Share your insights or perspective on the financial matter presented in the input. | Are there Investable Real Estate Indices which track Geographical Locations? | Yes. S&P/ Case-Shiller real-estate indices are available, as a single national index as well as multiple regional geographic indices. These indices are updated on the last Tuesday of every month. According to the Case-Shiller Index Methodology documentation: Their purpose is to measure the average change in home prices... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Are there Investable Real Estate Indices which track Geographical Locations? | Not to my knowledge. Often the specific location is diversified out of the fund because each major building company or real estate company attempts to diversify risk by spreading it over multiple geographical locations. Also, buyers of these smaller portfolios will again diversify by creating a larger fund to sell to ... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Trouble sticking to a budget when using credit cards for day to day transactions? | Discipline. If you have to have a hard limit on your account that prevents you from spending - credit cards are not for you. If you can discipline yourself not to make purchases in excess of your budget even if the plastic technically allows it - then you can go on using the credit card. Make sure to stay on top of you... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Trouble sticking to a budget when using credit cards for day to day transactions? | I am like you with not acknowledging balances in my accounts, so I pay my credit card early and often. Much more than once a month. With my banks bill pay, I can send money to the credit card for free and at any time. I pay it every two weeks (when I get paid), and I will put other extra payments on there if I boug... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Trouble sticking to a budget when using credit cards for day to day transactions? | Do yourself a favor: calculate the price of airfare, calculate how many points it takes to get a good flight, and calculate how many points you get per dollar spent. What you will find is that it is a ripoff. Leave the card at home and unlink it from your online purchasing accounts. You're welcome. If you really want t... |
Share your insights or perspective on the financial matter presented in the input. | Trouble sticking to a budget when using credit cards for day to day transactions? | If you keep going over budget with your credit card, then stop using the credit card. If you plan to pay off the card every month, then your balance should always be under whatever your budget is. For example, if you budget to spend $500, then even though your card has a limit of $5,000 you will never carry a balance ... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Trouble sticking to a budget when using credit cards for day to day transactions? | First of all, I have to recognize up front that my "spending personality" is frugal. I don't recreational shop, and I save a lot of my total income. Building a budget and sticking to it is difficult, especially for people who are closer to living paycheck to paycheck than I. Theoretically, it should be easy to stick to... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Trouble sticking to a budget when using credit cards for day to day transactions? | You can fairly simply make a spreadsheet in your favorite spreadsheet application (or in Google Docs if you want portability). I like to make an overview page that shows how much I take in per month and what fixed bills come out of that, then break the remaining total into four to get a weekly budget. Then, I make one ... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Trouble sticking to a budget when using credit cards for day to day transactions? | Similar to what Adam F says above, except instead of just transfering the amount you spend on the credit card into the high interest account, why not keep the majority of your funds (apart from a small amount, say a couple of hundred for emergencies) in the high interest account until the credit card needs to be paid o... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Trouble sticking to a budget when using credit cards for day to day transactions? | The trick to using a credit card responsibly is accounting. With your old system, you were paying for everything out of your savings account. Everytime you had an expense, it was immediately withdrawn from your savings account, and you saw how much money you had left. Now, with a credit card, there isn't any money bei... |
Share your insights or perspective on the financial matter presented in the input. | Trouble sticking to a budget when using credit cards for day to day transactions? | Easy... Use cash, or keep a ledger. |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Trouble sticking to a budget when using credit cards for day to day transactions? | As long as you can be trusted with a Credit Card i find that if you have a setup that uses three accounts: 1. your Credit Card, 2. 2. a high interest internet account (most of these accounts don’t have fees), 3. a savings account. The Method that works for me is: 1st i calculate my fixed monthly bills i.e Rent and uti... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Trouble sticking to a budget when using credit cards for day to day transactions? | In your comment in response to this answer, you said that your biggest issue is oversight, which you can do by checking your online bank account regularly. Mint.com looks good but you're in Australia? Easy, check out getpocketbook.com. Using it and love it, helps a lot to track your tracking, and it's a god-send during... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | As a new graduate, aside from the fact that you seem to have the extra $193/mo to pay more towards your loan, we don't know anything else. I wrote a lengthy article on this in response to a friend who had a loan, but was also pondering a home purchase in the future. Student Loans and Your First Mortgage discusses the ... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | If the savings rate is the same as the loan rate, mathematically it doesn't make any difference whether you pay down the loan more and save less or vice versa. However, if the loan rate is higher than the savings rate it's better to pay it down as fast as possible. The chart below compares paying down the loan and savi... |
Share your insights or perspective on the financial matter presented in the input. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | If you pay extra now you will pay less in interest over the life of the loan. Unless your savings account has a higher interest rate than the loan's rate you are not saving anything. That being said, you may have a greater need for savings due to other things (e.g. you might need a emergency fund). But if you are only ... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | There are a few ways you can go about paying this off quickly (and safely): You could start paying $386 monthly (ie, double what you're paying now). You'll pay less interest in the long run because they can only charge you for the amount outstanding. Remember, 6.8% of $12k is more than 6.8% of $6k. However, your plan s... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | As someone in the very same position as you here is what I suggest: Have $1,000 for each possible large expense you currently have. For example, house, car, pregnant wife, etc. As someone who only has a car (living at home still) I only have $1,000 in my eFund (emergency fund). The ABSOLUTE rest of my money goes to pay... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | The interest accrues daily based on the amount you owe. The less you owe the less the daily interest accrual. The faster you pay it off the less you pay in the lifetime of the loan. You are losing money if you bank money rather than applying it to the loan immediately. Since student loans cannot be declared in bank... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | Just one more thing to consider: a friend of mine had some student loan debt left over from graduate school. Years later, through his employer, he was able to apply for and receive a grant that paid off the remainder of his student loan. It was literally free money, and a significant amount, too. The windfall was a lit... |
Share your insights or perspective on the financial matter presented in the input. | To pay off a student loan, should I save up a lump sum payoff payment or pay extra each month? | Simply, you should put your money into whatever has the higher interest rate, savings or repayment of debt. Let's say at the beginning of month A you put $1000 into each account. In the case of the savings, at the end of month A you will have $1001.6 ($1000 + 1000 x 2% annual interest / 12) In the case of a loan, at th... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Should the poor consider investing as a means to becoming rich? | Definitions are in order: These definitions are important. Someone making 1,000,000 a year who spends all of it is poor. Someone who makes 500K, spends 450K a year and has three million in stocks and a paid-for million dollar home may be rich but they can't retire. They need another seven to eight million to retire. So... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Should the poor consider investing as a means to becoming rich? | Given that a poor person probably has much less to invest, how can odds be in their favor? To add to Lan's great answer, if one is "poor" because they don't have enough income to build wealth (invest), then there are only two ways to change the situation - earn more or spend less. Neither are easy but both are usually... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Should the poor consider investing as a means to becoming rich? | What could a small guy with $100 do to make himself not poor? The first priority is an emergency fund. One of the largest expenses of poor people are short-term loans for emergencies. Being able to avoid those will likely be more lucrative than an S&P investment. Remember, just like a loan, if you use your emergency fu... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Should the poor consider investing as a means to becoming rich? | Yes, you can indeed become rich by investing even small amounts over time. Let's say that you begin with nothing invested, and you start investing $100 per week. Suppose you choose to put your money in an S&P 500 index mutual fund. The CAGR (Compound Annual Growth Rate) of the S&P 500 over the last 35 years has been ab... |
Share your insights or perspective on the financial matter presented in the input. | Should the poor consider investing as a means to becoming rich? | Investments earn income relative to the principal amounts invested. If you do not have much to invest, then the only way to 'get rich' by investing is to take gambles. And those gambles are more likely to fail than succeed. The simplest way for someone without a high amount of 'capital' [funds available to invest] to b... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Should the poor consider investing as a means to becoming rich? | A cautionary tale: About 25 years ago I decided that I should try my hand at investing in some technology companies. I was in the computer biz but decided that I might suffer from myopia there, so I researched some medical startups. And I did some reasonably good research, given the available resources (the Interne... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Should the poor consider investing as a means to becoming rich? | What could a small guy with $100 do to make himself not poor To answer the question directly, not much. Short of investing in something at the exact moment before it goes bananas, then reinvesting into a bigger stock and bigger etc, it's super high risk. A better way is to sacrifice some small things, less coffee, less... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | What is the meaning of “short selling” or “going short” a stock? | This is a gross simplification as there are a few different ways to do this. The principle overall is the same though. To short a stock, you borrow X shares from a third party and sell them at the current price. You now owe the lender X shares but have the proceeds from the sale. If the share price falls you can buy ba... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | What is the meaning of “short selling” or “going short” a stock? | Rich's answer captures the basic essence of short selling with example. I'd like to add these additional points: You typically need a specially-privileged brokerage account to perform short selling. If you didn't request short selling when you opened your account, odds are good you don't have it, and that's good becau... |
Share your insights or perspective on the financial matter presented in the input. | What is the meaning of “short selling” or “going short” a stock? | The 'normal' series of events when trading a stock is to buy it, time passes, then you sell it. If you believe the stock will drop in price, you can reverse the order, selling shares, waiting for the price drop, then buying them back. During that time you own say, -100 shares, and are 'short' those shares. |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | What is the meaning of “short selling” or “going short” a stock? | The reason for selling a stock "short", is for when you believe the stock value will decrease in the near future. Here is an example: Today Exxon-Mobile stock is selling for $100 / share. You are expecting the price to decrease, so you want to short the stock, which means your broker (i.e. eTrade, etc) allows you to bo... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | stock option grant being cancelled because strike price greater than FMV and replaced with a new grant at a higher strike price | What could the tax issues with the IRS be? I thought (but not totally certain) that the tax treatment of an ISO option was based on difference between exercise price and FMV at the time of the sale. This is an accounting issue. There were times not so long ago that companies actually did these things on purpose, to bo... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | stock option grant being cancelled because strike price greater than FMV and replaced with a new grant at a higher strike price | Both you and the Company were probably benefitted by this decision. Specifically an option grant that was not FRV or more would require you to recognize the option as income whether you had exercised it or not. Additionally a host of other 409A tax issues/penalties could have been levied against you as an employee re... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | How does compounding of annual interest work? | The general concept is that your money will grow at an accelerating rate because you start getting interest paid on your returns in addition to the original investment. As a simple example, assume you invest $100 and get 10% interest per year paid annually. -At the end of the first year you have your $100 + $10 inte... |
Share your insights or perspective on the financial matter presented in the input. | How does compounding of annual interest work? | Here's how I have worked it out. Different answer to the one expected. Pretty sure it's right though. |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Can zero-coupon bonds go down in price? | Of course it can. This is a time value of money calculation. If I knew the maturity date, or current yield to maturity I'd be able to calculate the other number and advise how much rates need to rise to cause the value to drop from 18 to 17. For a 10 year bond, a rise today of .1% will cause the bond to drop about 1% i... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Can zero-coupon bonds go down in price? | Certainly, yes, a zero coupon bond can go down in price. If interest rates rise before your bond matures, the price of the bond will go down – and the longer to maturity, the more it will tend to drop. Depending on when you bought and how much interest rates rise, you can incur a capital loss. The bond is guaranteed t... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Can zero-coupon bonds go down in price? | Let's say today you buy the bond issued by StateX at 18$. Let's say tommorow morning the TV says that StateX is going towards default (if it happens it won't give you back not even the 18$ you invested). You (and others that bought the same bond like you) will get scared and try to sell the bond, but a potential buyer ... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Opening 5 credit cards at once with no history to ruin, is it a good idea? | I would not call this a "good" idea. But I wouldn't necessarily call it a bad idea either. Before you even consider it, you need to do a little bit of soul searching. If there is ANY chance that having multiple credit cards could entice you to spend more than you otherwise would, then this is definitely a bad idea. Avo... |
Share your insights or perspective on the financial matter presented in the input. | Opening 5 credit cards at once with no history to ruin, is it a good idea? | Yes, this is definitely possible. You can optimize your credit worthiness within 18 months, you would first start with a secured credit card just to establish a little bit of credit history and then use that as a jumping point 6 months later to do several unsecured credit card applications. As a student, your primary l... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Should I fund a move by borrowing or selling other property assets? | When you compare the costs of paying your current mortgage with the rental income from the flat, you're not really comparing like with like. Firstly, the mortgage payments are covering both interest and capital repayments, so some of the 8k is money that is adding to your net worth. Secondly, the value of the flat (130... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Should I fund a move by borrowing or selling other property assets? | that would deprive me of the rental income from the property. Yes, but you'd gain by not paying the interest on your other mortgage. So your net loss (or gain) is the rental income minus the interest you're paying on your home. From a cash flow perspective, you'd gain the difference between the rental income and your... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Should I fund a move by borrowing or selling other property assets? | It depends what rate mortgage you can get for any extra loans... If you remortgage you are likely to get a rate of 3.5-4%... depending who you go with. With deposit accounts in the UK maying around 1% (yes, you can get more by tying it up for longer but not a huge amount more) clearly you're better off not having a mo... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Should I fund a move by borrowing or selling other property assets? | It is a lot easier to make money when you are not in debt. If you can sell the apartment, get rid of your existing mortgage and buy the new house outright, that is probably the best course of action. |
Share your insights or perspective on the financial matter presented in the input. | First time homeowner and getting a mortgage? | If you have good credit, you already know the rate -- the bank has it posted in the window. If you don't have good credit, tell the loan officer your score. Don't have them run your credit until you know that you're interested in that bank. Running an application or prequal kicks off the sales process, which gets very ... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | First time homeowner and getting a mortgage? | First of all, think of anyone you know in your circle locally who may have gotten a mortgage recently. Ask him, her, or them for a recommendation on what brokers they found helpful and most of all priced competitively. Second of all, you may consider asking a real estate agent. Note that this is generally discouraged... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | First time homeowner and getting a mortgage? | Check with you local bank where you have an account. Sometimes they can offer a discount that results in a good rate. I just refinanced a month ago with Bank Of America and their rates were very competitive. What set them aside from the rest was their low closing fees. Otherwise I would shop around on bankrate.com an... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | First time homeowner and getting a mortgage? | Make sure you shop around and ask a lot of places for a good faith estimate. Last I knew, the good faith document is the same everywhere and long form that makes it easy enough to compare the hard numbers from place to place. I have gotten several estimates for various scenarios and I have had them hand written and p... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | First time homeowner and getting a mortgage? | I second the suggestions for your local credit union and asking co-workers who might also be in the process of a home purchase. Additionally, you want to educate yourself as much as possible so that you can ask questions about the calculations responsible for the differences. I got different values starting from the va... |
Share your insights or perspective on the financial matter presented in the input. | How bad is it to have a lot of credit available but not used? | Unless you have a history of over-using credit (i.e. you've gotten yourself into debt trouble), then I think that the banker is giving you bad advice in telling you to get your own credit limit reduced. Having more credit available to you that is left unused will make your utilization ratio lower, which is generally b... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | How bad is it to have a lot of credit available but not used? | While @BrianRogers makes some good points, there are a few things you need to consider from the FICO perspective that I want to lay out simply for you: |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | How bad is it to have a lot of credit available but not used? | I never give advice but I will now because you are getting poor advice. I run between 820 and 835 for a FICO score and have for years. I have a Discover, AMEX, VISA and MC. I have over 200,000 dollars of credit and I never EVER pay interest. I pay off the cards every month. So, does it matter how much credit you h... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | How bad is it to have a lot of credit available but not used? | Ironically, the worst financial advice I read comes from "bankers." The top dozen members here can be trusted to give better advice than the average banker. Your score is not improved by maintaining a balance, only by using the card(s) regularly. No need to carry charges month to month and pay interest, rather, have t... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Why don't people generally save more of their income? | If one takes a slightly more expansive view of the word "saving" to include most forms of durable asset accumulation, I think the reason some do and most don't is a matter of a few factors, I will include the three that seem obvious to me: Education Most schools in the US where I live do not offer personal finance cour... |
Share your insights or perspective on the financial matter presented in the input. | Why don't people generally save more of their income? | A person who always saves and appropriately invests 20% of their income can expect to have a secure retirement. If you start early enough, you don't need anything close to 20%. Now, there are many good reasons to save for things other than just retirement, of course. You say that you can save 80% of your income, and yo... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Why don't people generally save more of their income? | This question is likely to be voted closed as opinion-based. That said - In general people have become accustomed to instant gratification. They also have the media showing them luxury and are enticed every day to buy things they don't need. In the US, the savings rate is awfully low, but it's not just the lower 50%, ... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Best steps to start saving money for a fresh grad in Singapore? | Firstly, make sure annual income exceeds annual expenses. The difference is what you have available for saving. Secondly, you should have tiers of savings. From most to least liquid (and least to most rewarding): The core of personal finance is managing the flow of money between these tiers to balance maximizing retur... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Best steps to start saving money for a fresh grad in Singapore? | This is assuming that you are now making some amount X per month which is more than the income you used to have as a student. (Otherwise, the question seems rather moot.) All figures should be net amounts (after taxes). First, figure out what the difference in your cost of living is. That is, housing, electricity, util... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | How to increase my credit score | Get a credit card is NOT the answer. The reason people have a bad (or no) credit score is often because they're new to the country, have just turned 18, have previously fallen into arrears or are just bad with money. Getting a credit card is risky because, if you don't stay on top of your payments, it'll just damage yo... |
Share your insights or perspective on the financial matter presented in the input. | How to increase my credit score | It's probably important to understand what a credit score is. A credit score is your history of accruing debt and paying it back. It is supplemented by your age, time at current residence, time at previous residences, time at your job, etc. A person with zero debt history can still have a decent score - provided the... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | How to increase my credit score | I've been in the UK for 3.5 years, and I have the same problem: I can't get even a small loan from my bank; no one will give me a phone contract; it's a nightmare. I have 8 direct debits, I pay everything on time and I earn decent money, but still my credit is seen as no good. I have got a few ideas for you though: Goo... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | How to increase my credit score | You need to get yourself a credit card, and use it regularly and also repay on time. This will help increase your credit score. Hope you have a regular job which is bringing in money every month, but having just this isnt enough, get a credit card. |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | How to increase my credit score | Do you have the option of paying cash for the phone? To answer your question though: Essentially, you have to use credit RESPONSIBLY. That doesn't mean go get a slew of loans and pay them off. As Ratish said, a credit card is a good start. I basically buy everything with a card and then pay it off every month when the ... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Does money made by a company on selling its shares show up in Balance sheet | First: the question is irrelevant for purchases on exchange, mostly. Majority of sales on stock exchanges is between shareholders. If however you buy directly from the company (in a IPO, or direct share purchase program of some kind, like ESPP), then it does end up showing in the company account ledgers one way or anot... |
Share your insights or perspective on the financial matter presented in the input. | Does money made by a company on selling its shares show up in Balance sheet | Share sales & purchases are accounted only on the balance sheet & cash flow statement although their effects are seen on the income statement. Remember, the balance sheet is like a snapshot in time of all accrued accounts; it's like looking at a glass of water and noting the level. The cash flow and income statements ... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | When filing taxes in Canada, in what cases does box 39 on the T4 get reported as half of box 38? | Here's the best explanation I found relating to why your T4 box 39 might not have an amount filled in, even when box 38 has one: Department of Finance – Explanatory Notes Relating to the Income Tax Act [...]. It's a long document, but here's the part I believe relevant, with my emphasis: Employee Stock Options ITA 110(... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | When filing taxes in Canada, in what cases does box 39 on the T4 get reported as half of box 38? | Apparently box 39 does not receive half of box 38 if "The price of the share or unit is less than its fair market value when the agreement was made." - the last point in paragraph 110(1)(d): *http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/fnncl/scrty/stckpt03-eng.html#dspst The employee can claim a deduction under ... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | When filing taxes in Canada, in what cases does box 39 on the T4 get reported as half of box 38? | Assuming you purchased shares that were granted at a discount under the ESPP the 50% exemption would not apply. It's pretty unusual to see a US parent company ESPP qualify for the 110(1)(d) exemption, as most US plans provide for a discount |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | How do share dilution scams make money? | For this to work, those who control the dilution must also control their salaries because the only way for them to be paid off when it's the corporation itself selling is to gain access to the proceeds. When a corporation sells newly issued equity, the corporation itself owns the money. To at least have the appearance... |
Share your insights or perspective on the financial matter presented in the input. | What are the possible metrics for evaluating annual performance of a portfolio? | The Investopedia article you linked to is a good start. Its key takeaway is that you should always consider risk-adjusted return when evaluating your portfolio. In general, investors seeking a higher level of return must face a higher likelihood of taking a loss (risk). Different types of stocks (large vs small; intern... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Having trouble with APR calculation | I have answered your question in detail here https://stackoverflow.com/questions/12396422/apr-calculation-formula The annuity formula in FDIC document is at first finding PVIFAD present value annuity due factor and multiplying it with annuity payment and then dividing it by an interest factor of (1+i) to reduce the ann... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Having trouble with APR calculation | Check your calculation of A**. I was able to duplicate their calculations using excel. Make you sure have accounted for all the terms, it can be easy to be one off. They are making a guess at the interest rate which will be wrong, then they are adjusting it to see how wrong it is, then making another adjustment. They w... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Strategy for investing large amount of cash | Dollar Cost Averaging would be the likely balanced approach that I'd take. Depending on the size of the sum, I'd likely consider a minimum of 3 and at most 12 points to invest the funds to get them all working. While the sum may be large relative to my net worth, depending on overall scale and risk tolerance I could se... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Strategy for investing large amount of cash | I think a larger issue is that you're trying to do market timing. Whether you had a large or small amount of money to invest, no one wants to put the money in to watch it go down. You can't really predict if prices in a market or security will go up in six months (in which case you want to put all your cash in now), o... |
Share your insights or perspective on the financial matter presented in the input. | Strategy for investing large amount of cash | Getting the right diversity of investments helps buffer you from some of the short term market swings. If you need advice it's worth spending a small part of that money on a consultation with a financial adviser, who can talk to you about your goals, your time horizon, and your risk tolerance and recommend a good start... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Strategy for investing large amount of cash | What you put that money into is quite relevant. It depends on how soon you will need some, or all, of that money. It has been very useful to me to divide my savings into three areas... 1) very short term 'oops' funds. This is for when you forget to put something in your budget or when a monthly bill is very high this... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Is this mortgage advice good, or is it hooey? | add the interest for the next 5 payments and divide that by how much you paid on the principal during that time Let's see - on a $200K 6% loan, the first 5 months is $4869. Principal reduction is $1127. I get 4.32 or 432%. But this is nonsense, you divide the interest over the mortgage balance, and get 6%. You only get... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Is this mortgage advice good, or is it hooey? | Sounds like baloney to me. HELOCs are variable rate, so you are paying down the principal of a fixed rate loan with a variable rate loan. If you want to pay the mortgage down faster, make two half payments per month, and/or add a little extra to each payment (make sure with the bank that any extra will automatically go... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Is this mortgage advice good, or is it hooey? | Jack "The Mortgage Professor" Guttentag provides a thorough analysis of a similar-sounding system: In addition, I had the feeling that customers of Mortgage Relief should have gotten a spreadsheet for their $45, and wondered why they hadn’t? So I set out to develop a spreadsheet of my own that could quantify the benefi... |
Share your insights or perspective on the financial matter presented in the input. | Is this mortgage advice good, or is it hooey? | That makes no sense at all. They try to compare and that's exactly the same as comparing apples versus oranges. Mortgage is long-term loan, so for the first many years the huge part of the payment will go to repaying interest, so that ratio 1 will indeed be something like 20% or more despite the fact that the interest ... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | Is this mortgage advice good, or is it hooey? | This doesn't say the whole story (like the length of the HELOC). if you have 15 years left on a mortgage and "refinance" into a 30 year HELOC then yes, your payments maybe 20% lower, but you add 15 years to pay it off. Just remember that interest occurs daily on what you owe. If you move 100K of debt from 5% mortgage ... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | Is this mortgage advice good, or is it hooey? | Sounds fishy - taking out more debt to pay the main mortgage down faster? There are a couple of issues I can see: I would think that a much more sensible strategy with a lot less risk is to save up extra cash and send your lender a check every quarter or six months. |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | Is this mortgage advice good, or is it hooey? | I think the idea here is that because of the way mortgages are amortized, you can drop additional principal payments in the early years of the mortgage and significantly lower the overall interest expense over the life of the loan. A HELOC accrues interest like a credit card, so if you make a large principal payment us... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | Should I buy out my brother on a property we will inherit before making improvements? | In the end you, your dad, and your brother should come to an agreement so there's no surprises or unfulfilled expectations, but here's my opinion: If you can afford to make the additions now: I would offer to pay fully for the addition, with the understanding that the additional value that it generates is yours. That ... |
Share your insights or perspective on the financial matter presented in the input. | Should I buy out my brother on a property we will inherit before making improvements? | If your father is still able to make financial decisions and sign contracts, I see a better option. Have your father borrow against his equity to finance the renovation. Example: the house is worth 400 now. He can borrow 100 against that. He spends it on the addition, making the house worth 500, with the same 400 of e... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | After consulting HR Block, are you actually obligated to file your taxes with them, if they've found ways to save you money? | The obligation is contractual, so you need to read the contract to answer your question. However, since you paid for the service provided, I see no way they can force you buy any other service from them. They cannot file your tax returns without your explicit consent (on a form dedicated to that, dated and having the n... |
Utilize your financial knowledge, give your answer or opinion to the input question or subject . Answer format is not limited. | After consulting HR Block, are you actually obligated to file your taxes with them, if they've found ways to save you money? | This is a legal issue, or possibly an ethical issue, and not really a finance issue. And I am not a lawyer. But for what it's worth: Did you sign a written contract with H&R Block? If so, then the terms of that contract would govern. If you signed a contract saying that you agree to file your taxes through them if they... |
Offer your insights or judgment on the input financial query or topic using your financial expertise. Reply as normal question answering | After consulting HR Block, are you actually obligated to file your taxes with them, if they've found ways to save you money? | It sounds like they want to enter you into a contract in which they are allowed to charge a flat fee for filing contingent on money saving results from a tax review service, paid in full. Like those who answered before I have no legal experience. IRS Circular 230 defines the ethics for tax practitioners and the defini... |
Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open. | After consulting HR Block, are you actually obligated to file your taxes with them, if they've found ways to save you money? | As I have worked for H&R Block I know for a fact that they record all your activity with them for future reference. If it is their opinion that you are obligated to use their service if you use some other service then this, most likely, will affect your future dealings with them. So, ask yourself this question: is red... |
Share your insights or perspective on the financial matter presented in the input. | Evidence for/against negative correlation between commodity futures, stocks | The correlation I heard most about in economics/finance was that stock prices and bond yields were negatively correlated; as the stock market does better, bond yields fall (company's doing well as evidenced by stocks, so it's a good credit risk, so YTM of its bonds on the market goes down). The correlation, if any, bet... |
Offer your thoughts or opinion on the input financial query or topic using your financial background. | What does it mean when the broker does not have enough shares to short? | For Canada No distinction is made in the regulation between “naked” or “covered” short sales. However, the practice of “naked” short selling, while not specifically enumerated or proscribed as such, may violate other provisions of securities legislation or self-regulatory organization rules where the transaction fails ... |
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