The Most Interest

Very few people can afford to start a business using nothing but the money they’ve got lying around in their bank accounts. For most of us, we’re going to need to get a loan before we’d have anywhere near enough money to invest in starting up.

Your Credit History.

You might not have realized that your credit history was going to count here, but it does. This is where all those late credit card payments come back to bite you. The better your credit history, the more likely a bank is to lend you money, and the better the rate it offers will be.

Bank Loans.

Banks usually have someone whose job it is to go through applications for business loans. These people have seen a thousand business plans, and they know what they’re looking for.

Take along all your plans and any other supporting material you can put together. Make sure you present yourself at your most professional. Act like the most sensible and level-headed person you’ve ever met. This is, essentially, a job interview: the bank is interviewing you and your business to try and figure out whether it would be a safe place to put their money. Remember that they’re just like every investor, lending you money with the expectation that they will get it back, plus interest.

Secured Loans.

Of course, you’ll probably have a much easier time persuading a bank to lend you money if you put up something of your own as collateral in case you can’t pay the debt back. Some dodgy banks would really like you to secure your business loan on your house, since they know that the failure rate of start-ups is high and they’d really like to get their hands on it. Be cautious, in case you sign your life away. It is almost never worth starting a business if you can only get secured loans ñ you’re tying the business’ fortunes too closely to your own.

Government Loans.

As part of the push to support small businesses, there are now many government bodies that will offer no-interest or low-interest loans to small businesses, a category which includes home businesses. The government lot will obviously be even more picky about your business plan, but it’s still a good option to have available to you. Even better, these loans will often come with free help and advice from the agency that issues them, as well as all sorts of booklets and leaflets telling you the technical details of getting started.

Credit Cards and Overdrafts.

These forms of debt are a very bad idea. Whatever you do, do not finance your business with personal debt. You’ll have to make a massive profit just to pay back your debts, and it’s unlikely that you’ll manage to both pay them off and have enough money to live. If you can’t get a loan, try to find other investors instead.

Friends and Family.

Friends and family can be a surprisingly good source of loans to help start businesses, especially if they’re in the same industry themselves ñ they’ll be more than happy to help you get a foot on the ladder. You might be able to persuade someone to give you the money at a good rate of interest, or even to act as a ‘sleeping partner’, financing half of everything while leaving you to run it all.

Be aware, though, that many friendships and families have been ruined by failed businesses. I had a friend who went around raising thousands from everyone he could think of to start a magazine of his own, only for it to crash and burn by the second issue. Be warned.

Keep Trying.

If you get turned down for a loan, keep trying (preferably at different banks!) You should revise your business plan each time, and try to get as many people as possible to read it ñ the more people who see it, the more ideas and suggestions you can hear. If your credit rating is fine, then the problem has to be with the business plan: fix it, and you’re set. Good luck.

There are very few points that everybody in this world agrees upon. And the stock market unpredictability is undoubtedly one of them. Even people with several years of experience are not always able to track the stock market dynamics, thus falling prey to faulty decisions. Watertight stock market investing strategy is something that people consider to be elusive. It is something that can be chased, but probably can never be achieved.

But is it a correct notion? Are things like fate, luck, chance, etc., are the only deciding factors in the stock market investments? Or is there any way to approach the stock market in a speculative manner?

The answer to the above question probably lies in the Systematic Investment Plan or SIP (a.k.a. “Periodic Payment Plan” or “Contractual Plan”).

Systematic Investment Plan (SIP) Unlike the one-time investment plans, SIP entails regular payments for a fixed period. It allows investors to garner shares of a mutual fund by contributing a fixed (which is often small) amount of money on a regular basis. And it offers the following advantages readily attractive to any investor.

Reduced pressure on your purse

Through SIP you can enter the stock market even with a paltry investment. Your inability to invest a more-or-less fat amount might have kept you away from investing in the stock market. SIP is an ideal solution for your problem.

Building for the future

We have certain needs that can be addressed only through long-term investments. Such needs include childrenís education, buying a house of your own, post-retirement emergencies, etc. And SIP offers precious help in this regard. It helps you to save a small amount on a regular basis. And in due time it turns into a substantial amount.

Compounds returns

SIP not only helps you reach a substantial amount after a certain period of time. Rather it helps you to reach that amount at an early age, depending when you start investing. You can amass a notable amount at 70 if you start investing at 35. An earlier start at 25 can enable you achieve the same amount by 60.

Lowering the average cost

In SIP you experience low average cost, courtesy dollar-cost average. You invest the same fixed dollar amount in the same investment at regular intervals over an extended period of time. You are buying more shares of an investment when the share price is low. And you are buying fewer shares when the share price is high. And it may result in you paying a lower average price per share.

The dollar-cost averaging strategy does not try to time the market. Rather it reduces the risk of investing a larger amount in an investment at a wrong time. And it does the same by spreading your investments out over a period of months, years, or even decades.

Market timing irrelevance

The previous two paragraphs tell you that SIP makes the market timing irrelevant for you. The stock market unpredictability and volatility often play a deterrent for wannabe investors like you. In SIP, you are completely free from this problem of wrong timing.

The SIP’s mode of function

A typical SIP entails monthly investments over a period of 10, 15 or 25 years. You are generally allowed to start your investment with a modest sum.

You do not have direct ownership of the funds. Rather you own an interest in the plan trust. The plan trust invests the investor’s regular payments, after deducting applicable fees, in shares of a mutual fund.

Things that you should make clear before investing in an SIP

You should make certain things clear to yourself before going for an SIP investment. They include the following:

1. You should be confident about continuing to make payments for the term of the plan. Withdrawal in the mid way will almost certainly make you lose your money unless you are eligible for a full refund.
2. Check the fees charged by the plan. Also check the circumstances under which the plan waives or reduces certain fees.
3. Study the planís investment objectives. Take a note of the risks of investing in the plan. And check whether you are comfortable with them.
4. Check your statutory rights to a refund in case you cancel your plan.

Credit card companies offer varying benefits and promotions to entice their customers to use their credit cards not only in their everyday purchases but also for major buying decisions.

One of the promotions that credit card companies have is the rewarding of points to their users for every purchase that they make.

Different credit cards have different product features, benefits and ways of providing rewards to their users. A frequent traveler credit card that is made available in the market to those who are frequently flying can avail of the rewards points their card companies provide to them by converting these rewards to frequent flyer miles. These frequent flyer miles is then converted to actual miles that can be redeemed from airline companies that is co-sponsoring the credit card promotions with that credit card company. The frequent flyer miles are not always equivalent to the actual miles required to travel to particular destination. Some credit card companies reward the credit card user with 1 flyer mile for every dollar spent on his purchases. Different purchases mean varying reward points. Retail companies that may also co-sponsor those credit cards available in the market today may have higher reward points equivalent for purchases made on those credit cards to promote the sales of their products too.

Citing the frequent traveler credit card rewards system for example, a card user who purchases groceries, gas or technically his daily purchases, may have an equal travel reward points awarded to him for every dollar he spends on his regular purchases. On the other hand, should he ever buy plane tickets from an airline company co-sponsoring the credit card heís using, the reward points that he may earn may be higher as this is also one way to help promote the airline companyís latest promotions or travel packages.

Once an individual credit card user has accumulated enough points from his purchases, he may then redeem them for equivalent rewards. The higher the accumulated points, the higher the value of the reward he may redeem. Appliances such as a big flat screen tv or electronic gadgets such as a notebook PC are some of the possible rewards that credit card companies may offer their users when they redeem their rewards points. For smaller accumulated rewards points, a not so frequent credit card user may also redeem their points for rewards of smaller value such as a personal wall clock or a desk calculator. Credit card companies have different rewards for various points accumulated on a specific time period.

So, you want to put an offer in on a bank owned property?  I’ve asked several people who are in the business and here’s the best data I’ve collected:

The truth is that many times an offer is not accepted because the two parties involved are not optimal for each other.  If you are selling your house, you don’t care who the buyer is – you will get paid regardless. Banks, however, do care and most brokers do their homework on a prospective buyer better than others.

Here are some things to keep in mind, especially during these times:

• Banks are very hungry for cash right now so if you are going to negotiate – you have more leverage if you’re paying cash up front
• Banks know the value of the house they are selling.  They’ve done their homework.
• Banks do not like contingencies – they are selling as is for a reason – get an inspection if you must but don’t expect them to pay for anything to be done to the house
• Close, Close, Close! If you can’t at least SAY you can do this within 30 days, your offer is much weaker than others.  It usually takes much longer for this for the bank to close, so don’t worry too much. However, be ready for day 30.

Offers are basically separated into 3 tiers, A offers, B offers and C offers.  Clearly, the bank prefers A offers.

Tier A:

• All Cash – No Contingencies – Close ASAP
•  All Cash – few contingencies such as an inspection – Close ASAP

Tier B:

• Regular financing (approx 20% or more) – No Contingencies – Close ASAP
• Regular financing (approx 20% or more) – few contingencies such as an inspection – Close ASAP

Tier C:

• Low down payiment financing (3% – 19%) – No Contingencies – Close ASAP
• Low down payiment financing (3% – 19%) – few contingencies such as an inspection – Close ASAP

More than 50% of bank owned properties are purchased by all cash paying investors.  Buyers are usually street savvy and smart.  A lot of the times your offer can get beat, even if the total dollar amount is less but the earnest money deposit amount is higher.  Earnest Money is not the same as a Down Payment – (What is the difference between Earnest Money and a Down Payment) – Do not expect to win a bid if you are still somehow getting “100% Financing”.

• Be smart
• If you are serious about a property put your money where your mouth is and impress the bank
• Make sure you know who are you giving the earnest money to.
• Never give it to the seller
• Always make sure you read your contract, specifically instructions for refunding you the money you put down. 
• Don’t release the money until your transaction is complete.

Often, you can set the escrow account holding this earnest money to automatically return to the purchaser should the transaction not be complete by a certain date.

Received my monthly “You’ve met your requirements” letter that states I will be getting 6% APY:

“For the cycle beginning 08/29/08 and ending 09/29/08, your account qualified. To receive the highest rate of interest and ATM fee refunds”

However, this was also attached to the email:

“Beginning in October you will need to make 13 debit card transactions.  We are also going to cycle your account after month-end.  Transactions must post to your account by the last business day of the month.”

So, if you have a turbochecking.com account, please keep this in mind.  Won’t really effect me, as all it means is buying chips or a starbucks tea 3 more times a month… I can handle that.  I hope this isn’t a start to a slippery slope however.