September 2008

Our schools teach the fundamentals we all love; reading, writing, math, science and history. What concerns me is our school system lacks some of the ‘street smart’ skills that kids will need to be those successful leaders, healers and entrepreneurs.

As parents, we must take teach our children ‘money smarts’.

Can you imagine how empowered you would be if your parents taught you how to balance a checkbook, invest in the stock market, manage credit card debt, start a business, or the power of compounding interest?

If you were one of the lucky few whose parents did teach you money skills, consider yourself blessed. The present economic situation is a perfect time to teach our kids the importance of money management and the need to respect money for what it is, and isn’t.

So, where do we start? With the basics. Depending upon your child’s age, you can start with talking about money. Most of us don’t discuss the family’s financial situation at the dinner table. I propose you do. I think it’s important that children understand what is happening, good or bad, with the money being earned.

Don’t get me wrong here; I’m not suggesting you tell your kids your annual income or the balance of your investment portfolio. What I am suggesting is to bring the kids into conversations regarding ways to save, creative ways to earn additional money and what to spend that money on. Involve them with decisions on vacations, donating to a charity or cause, or how they plan to buy their first car.
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Warren Buffett’s Berkshire Hathaway, which has avoided major acquisitions in the financial sector in recent months, may have had a $3.5 billion two-day paper profit on six major banking and financial services investments.

The two-day rally in financial shares, which drove the broad S&P Financials Index 24 per cent, came as the government announced sweeping measures to rescue the financial system and restore confidence in shaky markets.

Shares of Wells Fargo & Company, the fifth-largest US bank and Berkshire’s second-largest investment as of June 30, rose 19pc over the last two days and touched a record high. That would have given Berkshire a $1.85bn paper profit on its reported 290.7 million share stake.

Berkshire would also have had a $1.12bn profit on its reported 151.6m share stake in American Express Company, the credit card and travel services company. Stakes in Bank of America, M&T Bank, SunTrust Banks and US Bancorp also gained value.

Buffett has long favoured investments in undervalued businesses with strong earnings and management. That has helped him transform Berkshire since 1965 from a failing textile maker into a conglomerate with at least 76 companies.

“He’s always felt Wells was very well-managed,” said Frank Betz, who oversees more than $800m at Carret/Zane Capital Management in Warren, New Jersey. “Why does he like banks? Like Willie Sutton said, it’s where the money is.”

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Great investors surely have investing secrets that they use to build wealth, but they are open secrets. Anyone can find out what the greats do and copy them to have success in wealth creation. And many of the so-called secrets are simply common sense principles.

For instance, investing in a company with consistent earnings is the sensible thing to do and one that has helped Warren Buffet earn his millions. Taking care to invest in old and well-established companies is another. Many investors run into trouble by jumping on the bandwagon of some new company that sparkles for a while then quickly dies out leaving a pile of rubble rather than money.

Another common sense principle that is applied to both real estate and shares by the great investors is to never pay too much for an investment. Generally the more you pay, the less you get back as many real estate investors have found out to their cost. Warren Buffet also believes in concentration rather than diversification. When he buys a company he typically buys around 80%, and keeps it.

Another secret investment principle Buffet favours that has helped him with his wealth creation is to buy companies with experienced managers and keep them on to do what they do best – run the company. Buffet rarely interferes with the running of the companies he buys. He simply compliments the managers on the job they are doing. Buffet’s talent is to see where good investments are and buy them, not run the company.

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Another crisis unfolding in the US, if this is likely to give you sleepless nights and you ponder on whether to sell or hold on to your equity portfolio, here’s a word of advice. Stay calm and invested, don’t panic and sell.

You don’t incur losses till the time you book them. Equity markets behave in this fashion and investors should take such falls in their stride. If you are a long-term investor, you are likely to get the best returns in such turbulent times.

At such low levels, markets look quite attractive. For investors waiting to venture into the markets, this is an ideal time to average out the cost of purchase. Invest in stocks that are fundamentally strong, preferably in a broad-based index that gives you exposure to large cap stocks. Avoid small or mid-cap companies. But if you lack understanding or don’t have much information, then take the help of professionals or try the mutual fund way.

To start off, one can look at index funds that mirror the movement of an index. Index funds should form the nucleus of your equity investments and other funds should surround it. These funds act as a stabilizing factor in an equity portfolio and should not be always seen as a return-giving factor.

But how about those who are already neck-deep into equities? “Stay invested. Don’t change the investment strategy and keep investing in a staggered manner.”

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Are you planning to put up your own small business? Then as early as now, you must already be thinking of every aspect of our business and the things that you would need in order for your business to operate well.

For small businesses, one of the most convenient promotional materials to use is posters because they are easy to work with, very cost efficient and also poster printing when done well could reel you in with more customers than you expect thus, it would also mean better investment returns for you.

The innovations made in technology had totally changed the way businesses handle all their printing jobs. The introduction of online printing had totally helped business people handle all their printing projects without the need to leave the comfort of their homes. Thus with online printing business had achieved to attain fast turn around days and easy printing jobs.

Invitation printing is among the preferred printing services opted at present. Although it is often implied that invitations can be done through the word of the mouth, people still make use of invitation cards for formality, for their clients or friends not to forget about the affair that will about to happen.

Online printing can be an ideal choice of doing your invitation printing projects. Through online printing you only need to:

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Leading bank shares around the world plunged yesterday after the crash of Lehman Brothers, forcing central banks to prop up the system with tens of billions of dollars. But US stocks rallied in the final hour of trading to close higher.

American Insurance Group (AIG) was the eye of the storm, with New York governor David Paterson warning the insurer had one day to raise $75-$80 billion.

After sliding about 150 points in early trading, Dow Jones Industrial Average closed at 11,059.02, up 141.51 points, or 1.3pc.

The S&P 500 gained 20.9 points, or 1.8pc, to 1,213.6, while the Nasdaq Composite climbed 27.99 points, or 1.3pc, to 2,207.9.

Stock markets took new fright yesterday after the Wall Street shocks, the bankruptcy of Lehman Brothers and bailout of Merrill Lynch by Bank of America.

The London and Tokyo markets dropped more than four per cent to their lowest points for more than three years with some leading bank shares dropping 20pc.

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The Internet is full of wonderful information, and much of this information can be found in ebooks. Whether you’re looking for guidance on feng shui, or just want to know how to save money, there’s an ebook out there for you. Here you’ll find a great collection of ebooks available online for free.

Learn about a wide variety of financial issues and advice in these ebooks.

  1. 66 Ways to Save Money: Learn about practical ways to cut costs in your daily life with this ebook.
  2. Estate Planning: Find out why a will is so important and how you can prepare one, plus plenty of other helpful details for estate planning.
  3. Ten Questions to Ask When Choosing a Financial Planner: Read this ebook to know what you should ask when looking for a professional to help you with your money.
  4. 7 Steps to Eliminate Debt: Take control of and eliminate your debt by following the steps outlined in this ebook.
  5. Living Trust Offers: The FTC commision’s pamphlet explains the details of living trusts and how you can protect yourself from estate planning scams.
  6. Get the Facts on Saving and Investing: This SEC document will help you learn how to save and invest properly.
  7. Simple Strategies for Managing Your Money: This FDIC ebook’s checklists will help you get financially fit and avoid scams.
  8. Building a Better Credit Report: In this ebook, you’ll learn about methods for legally improving your credit score, spotting scams, and dealing with debt.
  9. What You Should Know About Buying Life Insurance: In this pamphlet, you’ll find out about all of the types of life insurance, plus tips for choosing the right policy.
  10. How SIPC Protects You: Read this document to see how the Securities Investor Protection Corproration will help return your assets if your brokerage firm goes under.
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But, some economists say that the slowdown in August could be a temporary blip, and may not be indicative of a long-term trend.

China’s industrial output grew at its weakest pace in more than six year last month, partly due to the industrial shutdowns ordered by the government ahead of Olympics, the government’s statistics agency said on Friday. The sharp decline continued to be affected by the global economic downturn.

Industrial production in China expanded by 12.8% in August from a year earlier, the National Statistics Bureau said after a gain of 14.7% in July. The August reading was less than the 14.5% median estimate of economists. This was slowest rate since August 2002 and well below the 17.5% recorded in August 2007.

But, some economists said that the slowdown in August could be a temporary blip, and may not be indicative of a long-term trend. China’s industrial activity will pick up with the re opening of factories in Beijing and surrounding areas, JP Morgan’s local securities unit wrote in a note.

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During the last few years of real estate boom the prices were rising like fanatical and mortgage finance was simple to come by. However, things are now started to cool off so most banks and financial institutions have stiffened their mortgage lending practices.

Most significant, interest rates are rising very slowly for a last few months. This might actually not look like a real deal if you are new in the practice of house buying industry. But on a big home finance even a tiny interest rate boost could create a very huge difference to the payment you make. In usual cases the interest rate could further make the disparity among being established or discarded for a home mortgage proposal. That is because with the intention of qualifying for a home mortgages your capability to pay for the payment is one of the most vital criterions for getting sanction. And any higher interest rate might simply put the imbursement impractical.

Here the best option is to get in touch with experienced and trained mortgage broker who has qualified Certificate in Mortgage Advice training. No matter what you do, don’t just begin making home mortgage choices until you link up with somebody who has a great experience in the field of mortgage. Find a mortgage advisor who has dear knowledge of present real estate and home mortgage states and further also has entrée to many required alternatives. This would more often than not be your welcoming area banker. Banks effort with their own services and are not paying attention in making you conscious of other available products, which might offer a superior deal to you.

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There are many benefits in choosing a remortgage, some of which are listed below.

A remortgage is changing your mortgage without moving your home.

Remortgaging is the process of switching your mortgage to another lender that is offering a better deal than your current lender thereby saving money.

A remortgage can also be used to raise additional finances by releasing equity in your property.

When you remortgage you are ending your old mortgage deal and switching to a new one. This normally involves switching your lender although you can sometimes change deals with your current provider. If you do remortgage with your current lender it normally involves changing your existing deal.

You can borrow from $25,000 up to $500,000. Rates are variable, depending on status.

Remortgaging can allow you to get a better rate of interest and reduce your monthly mortgage payments.

A remortgage allows you to consolidate existing loans to one manageable monthly payment or raise money to buy a new car or home improvements.

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