When it comes to comparing active vs. passive investing and determining which investment method is best, the answer isn?t as clearly cut as you might imagine.
Everyone has very different risk tolerance levels, so it?s important to understand your own preferences and investing goals before you choose between active and passive investing choices.
Active vs. Passive Investing Definitions
Actively managed investments, such as mutual funds, try to beat the market performance of a benchmark index, such as the S&P 500, by choosing the best 100 or so performing stocks based on a likelihood of receiving good returns.
A passively managed investment will simply accept that market performance is what it is and invest in all 500 stocks on the index.
Which is Better ? Active or Passive?
Many investors wonder what the better option is for their own investing goals. Once again, it does come down to the individual investor?s personal levels of risk tolerance.
The level of risk you?re willing to take with your hard-earned money can often determine how you?re willing to spend and invest. After all, higher risks can often yield higher returns. Unfortunately higher risks can also compound losses too.
Low risk might equate to lower returns, but it?s commonly believed that a low guaranteed gain is far better than a risky bet on a higher risk return that may not eventuate.
Active Investing
An active investor understands that not all stock pricings move at the same rate or even in the same direction as the entire market as a whole. They will actively try to single out individual stocks that have the likelihood of out-performing the index.
In most cases, actively managed mutual funds carry higher costs. This is partly associated with the higher trading costs, time costs involved with researching likely stock picks and management costs.
For those investors who wish to take on their active investing activities themselves rather than trust their money to a fund manager, then day trading on the stock market is a very similar tactic. You spend the time researching stocks that are likely to outperform the index and you manage your portfolio personally, buying and selling as you try to capture profits and minimize losses.
Passive Investing
A passive investor will understand that as the market index moves up or down, then having a passively managed fund that is broadly diversified across almost all the available stocks on that index is likely to return average returns that are somewhat in line with the returns shown by that index.
Passively managed funds often carry lower fees and may tend to offer lower returns. However, those lower returns are often favored by investors who believe that receiving a low return is better than risking the chance of receiving no return at all.
For investors who once again don?t wish to trust their money to a fund manager, then your passive investing option is to develop a broadly diversified stock portfolio that you hold for the long term. You have the choice of allowing your stocks to simply sit in your portfolio and collecting the dividend or you can reinvest your dividend earnings back into your portfolio to acquire further stocks.
Ruthsella Corasol is the Owner of http://WorkingAtHome101.com. Check us out anytime for marketing tips and a free subscription to our cutting edge newsletter.
Thursday, May 24, 2012
Pension Tips For The Self-Employed
"Hello, I'm from the government. I'm here to help you." Ordinarily, these words
have a chilling effect on the self-employed, knowing as we do just how ironic
they can be. However, every once in a while they are true and advantageous.
This is the case with the tax-deferred pension options the U.S. government
makes available to the self-employed, people like you and me.
1) Do YOU have a pension plan? It's crazy not to!
The sad fact is, a MAJORITY of the self- employed don't have a pension plan.
Survey after survey documents the fact that millions of people -- each of whom
wants to get old (it beats the alternative) -- are NOT using their business and
the pension guidelines to arrange for a comfortable retirement. This is madness.
Don't wait another minute to do the necessary. Call your accountant today and
listen carefully as he presents your pension options. Make sure you take notes
and question him liberally until you really understand what you can do.
2) Be clear on how much you can invest in your tax-deferred pension account.
Your accountant should give you a precise figure to invest. Keep it close at
hand. Knowing this figure, and doing what's necessary to achieve it are both
crucial to your long-term comfort and security.
3) Know the next pension deposit deadline.
Ideally, you should deposit the full pension amount at the time you file your
federal taxes. If not, your accountant should give you the date (generally six
months after you've paid your taxes) that you can still pay into your pension
plan. This date is VERY important
4) Once you know the figure you can deposit into your pension plan, make
achieving it your #1 goal.
Say you are authorized to deposit $5,000 into your tax-deferred plan. Say you
have until September 1 to do so.
First, you want to deposit this amount in your pension plan just as early as
possible. Today if possible. Why? Because you want to put time to work for you.
All things being equal, it's better to make your pension payment on April 15
rather than September 15. It gives the funds just that much longer to grow.
This makes a great difference over time.
5) Treat your pension payments like a bill, your #1 bill.
Most people pay into their pension accounts after they've paid all their other
bills, when there may or may not be anything left. This is a mistake.
If you are unable to pay-off your pension balance at tax filing time and must
make (say) monthly payments, then ensure you make these payments the very first
thing each month, before you've depleted your available cash.
6) Cash windfall? Think pension!
Made a big sale? Had a bit of luck? Got some extra cash? Think PENSION!
Remember, deposit into your tax-deferred pension account as SOON as you can,
and if a bit of extra cash comes your way pay off what you "owe" your pension
account.
7) Pay your pension fund in advance whenever possible.
Had a good year? Made some extra money? Already paid the maximum into your
pension account? Then deposit some more! The future is, by definition, murky
and uncertain. That's why if you can deposit more, you should. Take any extra
funds you can spare and make an early deposit into your pension fund. When a
rainy day comes, you'll be glad you did!
8) Look but don't touch!
When that rainy day comes and you need extra cash, you may think longingly
about the funds in your tax-deferred pension account. DON'T!
You must regard your pension funds as sacrosanct, not to be touched until
commanded to do so by the federal regulations governing access and withdrawal.
If you withdraw them now, you will ordinarily pay a hefty penalty. What's more
you lose the benefits of time... and jeopardize the comfort and security of
your golden years. Find another way to get the funds you need. Don't dip into
this till.
Conclusion
We all hope to get old, but to get old without security and comfort is to be in
a most unenviable situation. Use your business -- and the tax-deferred pension
options provided by government --, to ensure your old age is as ample as you
deserve and desire.
Harvard-educated Dr. Jeffrey Lant is CEO of Worldprofit, Inc.,
www.worldprofit.com where small and home-based businesses learn how to profit
online. Attend Dr. Lant's live webcast TODAY and receive 50,000 free guaranteed
visitors to the website of your choice! Republished with author's permission by Ruthsella Corasol http://WorkingAtHome101.com
have a chilling effect on the self-employed, knowing as we do just how ironic
they can be. However, every once in a while they are true and advantageous.
This is the case with the tax-deferred pension options the U.S. government
makes available to the self-employed, people like you and me.
1) Do YOU have a pension plan? It's crazy not to!
The sad fact is, a MAJORITY of the self- employed don't have a pension plan.
Survey after survey documents the fact that millions of people -- each of whom
wants to get old (it beats the alternative) -- are NOT using their business and
the pension guidelines to arrange for a comfortable retirement. This is madness.
Don't wait another minute to do the necessary. Call your accountant today and
listen carefully as he presents your pension options. Make sure you take notes
and question him liberally until you really understand what you can do.
2) Be clear on how much you can invest in your tax-deferred pension account.
Your accountant should give you a precise figure to invest. Keep it close at
hand. Knowing this figure, and doing what's necessary to achieve it are both
crucial to your long-term comfort and security.
3) Know the next pension deposit deadline.
Ideally, you should deposit the full pension amount at the time you file your
federal taxes. If not, your accountant should give you the date (generally six
months after you've paid your taxes) that you can still pay into your pension
plan. This date is VERY important
4) Once you know the figure you can deposit into your pension plan, make
achieving it your #1 goal.
Say you are authorized to deposit $5,000 into your tax-deferred plan. Say you
have until September 1 to do so.
First, you want to deposit this amount in your pension plan just as early as
possible. Today if possible. Why? Because you want to put time to work for you.
All things being equal, it's better to make your pension payment on April 15
rather than September 15. It gives the funds just that much longer to grow.
This makes a great difference over time.
5) Treat your pension payments like a bill, your #1 bill.
Most people pay into their pension accounts after they've paid all their other
bills, when there may or may not be anything left. This is a mistake.
If you are unable to pay-off your pension balance at tax filing time and must
make (say) monthly payments, then ensure you make these payments the very first
thing each month, before you've depleted your available cash.
6) Cash windfall? Think pension!
Made a big sale? Had a bit of luck? Got some extra cash? Think PENSION!
Remember, deposit into your tax-deferred pension account as SOON as you can,
and if a bit of extra cash comes your way pay off what you "owe" your pension
account.
7) Pay your pension fund in advance whenever possible.
Had a good year? Made some extra money? Already paid the maximum into your
pension account? Then deposit some more! The future is, by definition, murky
and uncertain. That's why if you can deposit more, you should. Take any extra
funds you can spare and make an early deposit into your pension fund. When a
rainy day comes, you'll be glad you did!
8) Look but don't touch!
When that rainy day comes and you need extra cash, you may think longingly
about the funds in your tax-deferred pension account. DON'T!
You must regard your pension funds as sacrosanct, not to be touched until
commanded to do so by the federal regulations governing access and withdrawal.
If you withdraw them now, you will ordinarily pay a hefty penalty. What's more
you lose the benefits of time... and jeopardize the comfort and security of
your golden years. Find another way to get the funds you need. Don't dip into
this till.
Conclusion
We all hope to get old, but to get old without security and comfort is to be in
a most unenviable situation. Use your business -- and the tax-deferred pension
options provided by government --, to ensure your old age is as ample as you
deserve and desire.
Harvard-educated Dr. Jeffrey Lant is CEO of Worldprofit, Inc.,
www.worldprofit.com where small and home-based businesses learn how to profit
online. Attend Dr. Lant's live webcast TODAY and receive 50,000 free guaranteed
visitors to the website of your choice! Republished with author's permission by Ruthsella Corasol http://WorkingAtHome101.com
Tuesday, May 15, 2012
Facebook Applications
Engaging Customers with Facebook Applications
With the rapid advancement in the Internet and its increasing user presence, the medium has become a preferred means of communicating directly with customers. Among the most popular activities on the Internet is the voracious usage of social networking sites.
With its open architecture and wide range of functionalities, Facebook stands as the number one social networking site. There are many reasons for this cult followership of Facebook. The ease of use and dissemination of content, tagging of friends and related users on shared items is yet another great Facebook feature. Facebook also allows creation of secured groups and publicly available fan pages regarding your own brands.
The Facebook applications are its most popular components. Facebook has an open platform for web developers and programmers to create different applications to run applications from within its framework.
What is new about Facebook applications?
Until the option of applications was incorporated, the Facebook features were more about conventional social media usage, such as adding friends and creating groups pertaining to common interests and affiliations.
Applications initiated by Facebook expanded the function of the site toward more interesting features, which included social gaming, where you could include friends and even unknown participants from around the world. The big leap happened when Facebook opened its programming platform to developers around the world, who could develop applications and submit it to Facebook. These applications are made live for public usage once they are certified by Facebook.
How do applications help brand marketing?
On an average, a user would spend no more than a few seconds on the homepage or any other text rich section of a website. Similarly, on Facebook, text-based sections have their own limitations when it comes to holding attention of the users on the same page. That is where rich content and applications come into play.
A game, such as Scrabulous or UNO, on Facebook can engage a user for hours. Social games like Farmville have brought about a new genre of Social Gaming, which is the latest buzzword in gaming circles.
For a brand, a Facebook application can serve as an effective tool to gather and engage captive audience for a longer stretch of time. Users hooked on a particular game or application on Facebook will stay with it until the completion of the game. Brands have smartly used the opportunity to insert their logos and branding very subtly in the game. Subtle messages like these are known to give more brand recall and attitude change compared to intrusive advertisements.
Much to the delight of a marketer, Facebook provides usage stats of subscribers, which gives insight into the profile of users that the brand attracts. This can be compared with the intended target audience of the brand, and campaign modifications can be done based on the findings. Unlike most surveys that are based on sample estimate, what you get to see here is a summary based on each and every user who has added the application.
Developing Applications for Your Brand
Unlike most other participative aspects of social media, developing applications for Facebook requires adequate programming knowledge. Facebook has its own set of guidelines for the creation and submission of applications. Developers working on the Facebook framework must be updated with the guidelines defined by the site for any application to run. Brand owners need to avail services of a developer who knows all the steps that go into the creation of successful Facebook applications to ensure that their brand makes its presence through one of the most engaging options available in online media.
Get more information here for the best Facebook training available: http://www.WorkingAtHome101.com/?rd=te9qac0F
Saturday, May 12, 2012
Cash It Back with Credit Cards
What is a cash back credit card?
A cash back credit card gives annual rebates or gives back money to the card holder based on how much have been purchased with it. This type of credit card is suitable for those who rarely use cash in their transactions. The rebate is computed as a percentage of the total amount charged to the credit card in a year. Usually, rebates are between 1-2%. Some can even go as high as 3%.
Are rebates always in the form of cash?
Strictly speaking, cash rebates should be in the form of cash. But now that card companies are diversifying, rebates may now come in the form of gift certificates and discount coupons. This somehow blurs the line between and among the different types of credit cards mentioned in the first paragraph of this article.
Some cash back credit cards offer upgrading of membership status which allow their members to more discounts and gifts during anniversaries and holidays like Christmas and birthdays. Moreover, some credit card companies also have partnerships with other consumer products that entitle their members to added product discounts in future purchases.
What banks offer cash back credit cards?
There are many banks that offer cash back credit cards in kind. They usually have a rewards program for members wherein card holders receive gifts and discounts courtesy of partner product companies; discount coupons to hotels, restaurants, specialty stores; and travel miles for non-travel purchases. Below are some banks that offer cash back benefits.
1. Citibank
2. Chevy Chase Bank
3. HSBC
4. Royal Bank Avion (Canada)
5. Standard Chartered Bank
Are cash back credit cards offered only by banks?
No. Since business establishments are innovating their services and benefits for their customers, some of them offer cash back to their loyal customers e.g. Discover Card (Discover Magazine). Aside from giving book and magazine discounts, airline miles are also offered by Discover Card. Big grocery stores such as Krogers, Wal Mart, and Bi-Lo offer cash back but in the form of cash certificates and discount coupons.
How does one get a cash back credit card?
Since almost all credit card companies (e.g. banks, stores, airlines) offer cash (or in kind) back benefits, all that has to be done is to file an application in any of their office or stores, or signup online by visiting their web sites. Just be a word of caution for online applications, make sure that the transaction is made through a secure internet connection since identity theft has become rampant with the advent of credit card use.
CPP_author
Ruthsella Corasol is the Owner of http://WorkingAtHome101.com. Check us out anytime for marketing tips and a free subscription to our cutting edge newsletter.
A cash back credit card gives annual rebates or gives back money to the card holder based on how much have been purchased with it. This type of credit card is suitable for those who rarely use cash in their transactions. The rebate is computed as a percentage of the total amount charged to the credit card in a year. Usually, rebates are between 1-2%. Some can even go as high as 3%.
Are rebates always in the form of cash?
Strictly speaking, cash rebates should be in the form of cash. But now that card companies are diversifying, rebates may now come in the form of gift certificates and discount coupons. This somehow blurs the line between and among the different types of credit cards mentioned in the first paragraph of this article.
Some cash back credit cards offer upgrading of membership status which allow their members to more discounts and gifts during anniversaries and holidays like Christmas and birthdays. Moreover, some credit card companies also have partnerships with other consumer products that entitle their members to added product discounts in future purchases.
What banks offer cash back credit cards?
There are many banks that offer cash back credit cards in kind. They usually have a rewards program for members wherein card holders receive gifts and discounts courtesy of partner product companies; discount coupons to hotels, restaurants, specialty stores; and travel miles for non-travel purchases. Below are some banks that offer cash back benefits.
1. Citibank
2. Chevy Chase Bank
3. HSBC
4. Royal Bank Avion (Canada)
5. Standard Chartered Bank
Are cash back credit cards offered only by banks?
No. Since business establishments are innovating their services and benefits for their customers, some of them offer cash back to their loyal customers e.g. Discover Card (Discover Magazine). Aside from giving book and magazine discounts, airline miles are also offered by Discover Card. Big grocery stores such as Krogers, Wal Mart, and Bi-Lo offer cash back but in the form of cash certificates and discount coupons.
How does one get a cash back credit card?
Since almost all credit card companies (e.g. banks, stores, airlines) offer cash (or in kind) back benefits, all that has to be done is to file an application in any of their office or stores, or signup online by visiting their web sites. Just be a word of caution for online applications, make sure that the transaction is made through a secure internet connection since identity theft has become rampant with the advent of credit card use.
CPP_author
Ruthsella Corasol is the Owner of http://WorkingAtHome101.com. Check us out anytime for marketing tips and a free subscription to our cutting edge newsletter.
Thursday, May 3, 2012
Can You Be Sued For Credit Card Debts
People often ask can you be sued for credit card debts and the short answer is yes you can. You owe this money and you need to repay it or your creditors will take action against you. But the good news is that there are various laws and regulations in place that these financial institutions must adhere to. You, as a consumer, are very well protected especially when compared to practices outside of the US.
There are two types of law, State Laws and Federal Laws. Every State will have their own rules with regard to debt collection so it is best if you read up on your local ones. Your bank or financial institution will be able to provide you with a copy of the relevant laws. There should be a statute of limitation which will dictate how long your creditors have to file a lawsuit to recover their money.
This does vary but usually lies within 3 to 10 years but you should check. Federal laws apply to everyone regardless of where you live. The law you are probably now most interested in will be the Federal Fair Debt Collection Practices Act. This law covers how your creditors must behave when attempting to collect monies due. It also dictates where and when lawsuits can be filed if you live in a different state to your creditor. Another act you should familiarize yourself with is the Credit Card Reform act. Depending on your age and circumstances, you may find that some of these provisions are relevant to your case.
If you are having problems repaying your debts, make an emergency appointment with a local debt counseling service. You should be able to find a free advisor in your area such as one provided by a charity. If possible avoid the paid debt negotiation advisors as any spare funds you have should be directed towards repaying your creditors. Your advisor and the people you owe money to will want to see a full income and expenditure account. You will need to write down exactly how much money you make from all sources and what you spend this money on. Some debts are a priority meaning that you should always pay these first but your advisor will go through this with you.
Whatever you do, do not ignore the situation you are in. It will only get worse. All credit card debt problems can be resolved one way or another. Bankruptcy is always an option although one you do not want to enter into lightly and definitely not without proper advice.
Suing you isn't your creditors' only option. They could sell your debt onto a third party company who won't care what your personal circumstances are. But if you have had a good record with your bank and your money problems are recent, you may find that they are willing to work with you to reach a solution.
So now you know the answer to can you be sued for credit card debts is yes, you need to do everything you can to avoid this scenario.
Ruthsella Corasol is the Owner of http://WorkingAtHome101.com Check us out anytime for marketing tips and a free subscription to our cutting edge newsletter.
There are two types of law, State Laws and Federal Laws. Every State will have their own rules with regard to debt collection so it is best if you read up on your local ones. Your bank or financial institution will be able to provide you with a copy of the relevant laws. There should be a statute of limitation which will dictate how long your creditors have to file a lawsuit to recover their money.
This does vary but usually lies within 3 to 10 years but you should check. Federal laws apply to everyone regardless of where you live. The law you are probably now most interested in will be the Federal Fair Debt Collection Practices Act. This law covers how your creditors must behave when attempting to collect monies due. It also dictates where and when lawsuits can be filed if you live in a different state to your creditor. Another act you should familiarize yourself with is the Credit Card Reform act. Depending on your age and circumstances, you may find that some of these provisions are relevant to your case.
If you are having problems repaying your debts, make an emergency appointment with a local debt counseling service. You should be able to find a free advisor in your area such as one provided by a charity. If possible avoid the paid debt negotiation advisors as any spare funds you have should be directed towards repaying your creditors. Your advisor and the people you owe money to will want to see a full income and expenditure account. You will need to write down exactly how much money you make from all sources and what you spend this money on. Some debts are a priority meaning that you should always pay these first but your advisor will go through this with you.
Whatever you do, do not ignore the situation you are in. It will only get worse. All credit card debt problems can be resolved one way or another. Bankruptcy is always an option although one you do not want to enter into lightly and definitely not without proper advice.
Suing you isn't your creditors' only option. They could sell your debt onto a third party company who won't care what your personal circumstances are. But if you have had a good record with your bank and your money problems are recent, you may find that they are willing to work with you to reach a solution.
So now you know the answer to can you be sued for credit card debts is yes, you need to do everything you can to avoid this scenario.
Ruthsella Corasol is the Owner of http://WorkingAtHome101.com Check us out anytime for marketing tips and a free subscription to our cutting edge newsletter.
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