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How do I research if my student loan company is doing something illegal?

['"The thing to recall here is that auto-pay is a convenience, not a guarantee. Auto-pay withdrawals, notices that a bill is due, all of these are niceties that the lender uses to try to make sure you consistently pay your bill on time, as all businesses enjoy steady cash flows. Now, what all of these ""quality of life"" features don\'t do is mitigate your responsibility, as outlined when you first took out the loan, to pay it back in a timely manner and according to the terms and conditions of the loan. If your original contract for the loan states you shall make ""a payment of $X.XX each calendar month"", then you are required to make that payment one way or another. If auto-pay fails, you are still obligated to monitor that and correct the payment to ensure you meet your contractual obligation. It\'s less than pleasant that they didn\'t notify you, but you were already aware you had an obligation to pay back the loan, and knew what the terms of the loan were. Any forgiveness of interest or penalties for late fees is entirely up to the CSR and the company\'s internal policies, not the law."']

I carelessly invested in a stock on a spike near the peak price. How can I salvage my investment?

['"Is there anyway to salvage my investment for short-term? No. If by ""salvage"" you mean ""get back as much as you paid"", the only way to salvage it is to wait as long as you consider ""short-term"" and see if goes up again. If by ""salvage"" you mean ""get some money back"", the only thing you can do to guarantee that is sell it now. By doing so, you guarantee that you will get neither more nor less than it is worth right now. Either way, there is nothing you can do other than sell the stock or hold it. The stock price went down. You can\'t make it go back up. Would it be better if I sell my stocks now and buy from other company? Or should I just wait for it\'s price to go up again? This depends on why you bought the stock, and what you think it will do in the future. You said a family member persuaded you. Does that family member still think the stock will go up again? If so, do you still trust them? You didn\'t even say what stock it is in your question, so there\'s no way anyone here can tell you whether it\'s a good idea to sell it or not. Even if you do say what stock it is, all anyone can do is guess. If you want, you could look the stock up on Motley Fool or other sites to see if analysts believe it will rise. There are lots of sources of information. But all you can do with that information is decide to sell the stock or not. It may sound obvious, but you should sell if you think the stock will go lower, and hold it if you think it could still go back up. No one can tell you which of those things is going to happen."', '"It would be useful to forget about the initial price that you invested - that loss happened, it\'s over and irreversible, it\'s a sunk cost; and anchoring on it would only cause you to make worse decisions. Getting ""back"" from a loss is done exactly the same as growing an investment that didn\'t have such a loss. You have x units of stock that\'s currently priced $46.5 - that is your blank slate; you need to decide wether you should hold that stock (i.e., if $46.5 is undervalued and likely to increase) or it\'s likely to fall further and you should sell it. The decision you make should be exactly the same as if you\'d bought it a bit earlier for $40."', "I had a coworker whose stock picking skills were clearly in the 1% level. I had a few hundred shares of EMC, bought at $10. When my coworker bought at $80, I quietly sold as it spiked to $100. It then crashed, as did many high tech stocks, and my friend sold his shares close to the $4 bottom advising that the company would go under. So I backed up the truck at $5, which for me, at the time, meant 1000 shares. This was one of nearly 50 trades I made over a good 10 year period. He was loud enough to hear throughout the office, and his trades, whether buy or sell, were 100% wrong. Individual stocks are very tough, as other posters have offered. That, combined with taking advice from those who probably had no business giving it. For the record, I am semi-retired. Not from stock picks, but from budgeting 20% of income to savings, and being indexed (S&P) with 90% of the funds. If there are options on your stock, you might sell calls for a few years, but that's a long term prospect. I'd sell and take my losses. Lesson learned. I hope.", "You should be worried. You have made the mistake of entering an investment on the recommendation of family/friend. The last think you should do is make another mistake of just leaving it and hoping it will go up again. Your stock has dropped 37.6% from its high of $74.50. That means it has to go up over 60% just to reach the high of $74.50. You are correct this may never happen or if it does it could take a long, long time to get up to its previous highs. What is the company doing to turn its fortunes around? Take a look at some other examples: QAN.AX - Qantas Airways This stock reached a high of around $6 in late 2007 after a nice uptrend over a year and a half, it then dropped drastically at the start of the GFC, and has since kept falling and is now priced at just $1.15. QAN reported its first ever loss earlier this year, but its problems were evident much earlier. AAPL - Apple Inc. AAPL reach a high of just over $700 in September 2013, then dropped to around $400 and has recovered a bit to about $525 (still 25% below its highs) and looks to be at the start of another downtrend. How long will it take AAPL to get back to $700, more than 33% from its current price? TEN.AX - Ten Network Holdings Limited TEN reached a high of $4.26 in late 2004 after a nice uptrend during 2004. It then started a steep journey downwards and is still going down. It is now priced at just $0.25, a whopping 94% below its high. It will have to increase by 1600% just to reach its high of $4.26 (which I think will never happen). Can a stock come back from a drastic downtrend? Yes it can. It doesn't always happen, but a company can turn around and can reach and even surpass it previous highs. The question is how and when will this happen? How long will you keep your capital tied up in a stock that is going nowhere and has every chance of going further down? The most important thing with any investment is to protect your current capital. If you lose all your capital you cannot make any new investments until you build up more capital. That is why it is so important to have a risk management strategy and decide what is your get out point if things go against you before you get into any new investment. Have a stop loss. I would get out of your investment before you lose more capital. If you had set a stop loss at 20% off the stock's last highs, you would have gotten out at about $59.60, 28% higher than the current share price of $46.50. If you do further analysis on this company and find that it is improving its prospects and the stock price breaks up through its current ranging band, then you can always buy back in. However, do you still want to be in the stock if it breaks the range band on the downside? In this case who knows how low it can continue to go. N.B. This is my opinion, as others would have theirs, and what I would do in your current situation with this stock.", '"You probably bought the stock near the peak because ""it\'s been up a lot lately."" That\'s the easiest way to lose money. You need to go back and do some basic research. The stock appears to have been expensive around 75. Why is that? The stock seems to be in a ""comfortable"" level around 45. Why is THAT? Maybe it\'s too expensive around 45 (based on the P/E ratio, or other measures); maybe you should buy more at 45, where it is cheap, even though 75 is too expensive. The key is to study the stock where it is today (45-47). Ask yourself what you would do at TODAY\'s price, and today\'s ""fundamentals."" That will also save you from paying 75 for a stock worth 45, and should save you from paying 45 for a stock if it is only worth 35."', '"If you\'re asking this question, you probably aren\'t ready to be buying individual stock shares, and may not be ready to be investing in the market at all. Short-term in the stock market is GAMBLING, pure and simple, and gambling against professionals at that. You can reduce your risk if you spend the amount of time and effort the pros do on it, but if you aren\'t ready to accept losses you shouldn\'t be playing and if you aren\'t willing to bet it all on a single throw of the dice you should diversify and accept lower potential gain in exchange for lower risk. (Standard advice: Index funds.) The way an investor, as opposed to a gambler, deals with a stock price dropping -- or surging upward, or not doing anything! -- is to say ""That\'s interesting. Given where it is NOW, do I expect it to go up or down from here, and do I think I have someplace to put the money that will do better?"" If you believe the stock will gain value from here, holding it may make more sense than taking your losses. Specific example: the mortgage-crisis market crash of a few years ago. People who sold because stock prices were dropping and they were scared -- or whose finances forced them to sell during the down period -- were hurt badly. Those of us who were invested for the long term and could afford to leave the money in the market -- or who were brave/contrarian enough to see it as an opportunity to buy at a better price -- came out relatively unscathed; all I have ""lost"" was two years of growth. So: You made your bet. Now you have to decide: Do you really want to ""buy high, sell low"" and take the loss as a learning experience, or do you want to wait and see whether you can sell not-so-low. If you don\'t know enough about the company to make a fairly rational decision on that front, you probably shouldn\'t have bought its stock."', 'If you know you have picked a bad stock, the sooner you sell the better. There is a tendency to hold a bad stock in the hope that it will pick up again. Most of us fall into this trap. The best way one needs to look at things are;', "Ignore sunk costs and look to future returns. Although it feels like a loss to exit an investment from a loss position, from a financial standpoint you should ignore the purchase price. If your money could be better invested somewhere else, then move it there. You shouldn't look at it as though you'll be more financially secure because you waited longer for the stock to reach the purchase price. That's psychological, not financial. Some portion of your invested wealth is stuck in this particular stock. If it would take three months for the stock to get back to purchase price but only two months for an alternate investment to reach that same level, then obviously faster growth is better. Your goal is greater wealth, not arbitrarily returning certain investments to their purchase price. Investments are just instrumental. You want more wealth. If an investment is not performing, then ignore purchase price and sunken costs. Look at the reasonable expectations about an investment going forward.", "The market doesn't know or care why you bought. What you are asking is effectively 'this share went down in price after I bought. Is there anything I can do?'. Consider what you are asking for - if there were anything you could do, then no one would ever make a loss. How do you suppose that would work?", '"Basically, your question boils down to this: Where and how do I squeeze the stock market so that within time period X, it will make me Y dollars. (Where I\'m emotionally attached to the Y figure because I recently lost it, and X is ""as soon as possible"".) To make money on the stock market (in a quasi-guaranteed way), you have to adjust X and Y so that they are realistic. For instance, let X be twenty-five years, and Y be ""7% annual return"". Small values of X are risky, unless X is on the order of milliseconds and you have a computer program working for you. To mitigate some of the risk of short term trading, you have to treat trading seriously and study like mad: study the stock market in general, and not only that, but carefully research the companies whose stocks you are buying. Work actively to discover stocks which are under-valued relative to the performance of their corporation, and which might correct upward relative to the performance of similar stocks. Always have an exit strategy for every position and stick to it. Use instruments like ""trailing stops"": automatic tracking which follows a price in one direction, and then produces an order to close the position when the price reverses by a certain amount."', "Some financial planners would not advise one way or the other on a specific stock without knowing your investment strategy... if you didn't have one, their goal would be to help you develop one and introduce you to a portfolio management framework like Asset Allocation. Is a two of clubs a good card? Well, that all depends on what is in your hand (diversification) and what game you are playing(investing strategy). One possibility to reduce your basis over time if you would like to hold the stock is to sell calls against it, known as a 'covered-call'. It can be an intermediate-term (30-60+ months depending on option pricing) trading strategy that may require you to upgrade your brokerage account to allow option trades. Personally I like this strategy because it makes me feel proactive about my portfolio rather than sitting on the side lines and watching stocks move.", "I am very surprised no one mentioned the Stock Repair Option Strategy which has real benefits and is one of the mainstream Option Strategies. Quote: Who Should Consider Using the Stock Repair Strategy? In a nutshell, you are buying call options with current strike price (at-the-money) and sell call options with higher strike price (out-of-the-money), all with the same expiry dates. The only reason to also sell call options here is to recover your premium paid for the other call options. If you are comfortable paying that premium, you just buy the call options without selling the others. In case your stock will rise moderately to a price between the two strike prices, your call option will rise together with your stock, so you will be faster to recover your money. This is the main reason it is called Repair. If you have sold any call options, as the price rises, you have to be careful when it reaches the strike price of the options sold, as from there on you will begin incurring losses. It is however exactly the lucky outcome you were hoping for, your stock is higher, and you can buy back those loss making options - then or shortly before. If you didn't sell any options and payed your premium, you don't need to worry at all at this stage. WARNING It should be noted that the Stock Repair Strategy offers no protection for your stock price further falling down. In that case all those options will expire worthless or you can sell back the ones your bought but likely not for much. In order to have the downside protection for your stock, there are other strategies, the simplest one being buying a Put Option at-the-money or slightly lower. That will effectively cut your possible losses to the Option Premium (which is the main use of that option). Again, if you hate to pay that premium, you can offset it by selling other options that you either hope won't be exercised or take steps to protect you against those.", '"You can do several things: After the fact: If you believe the stock will go up, you can buy more stock now, it\'s what\'s called ""averaging"". So, you bought 100 at $10, now it\'s at $7. To gain money from your original investment it needs to raise to over $10. But if you really think it\'ll go up, you can buy and average. So you buy, say, 100 more stock at $7, now you have 200 shares at $8.50 average so you gain money on your investment when the stock goes over $8.50 instead of $10. Of course, you risk losing even more money if the stock keeps going down. Before the fact: When you buy stock, set \'triggers\'. In most trading houses you can set automatic triggers to fire on conditions you set. When you buy 100 shares at $10, you can set a trigger to automatically sell the 100 shares if it drops below $9, so you limit your losses to 10% (for example)."', '"Yes, you could sell what you have and bet against others that the stock price will continue to fall within a period of time ""Shorting"". If you\'re right, your value goes UP even though the stock price goes down. This is a pretty darn risky bet to make. If you\'re wrong, there\'s no limit to how much money you can owe. At least with stocks they can only fall to zero! When you short, and the price goes up and up and up (before the deadline) you owe it! And just as with stocks, someone else has to agree to take the bet. If a stock is pretty obviously tanking, its unlikely that someone would oppose your bet. (It\'s probably pretty clear that I barely know what I\'m talking about, but I was surprised not to see this listed among the answers.)"', "Just get out. If the investment isn't going up, you are losing money to inflation, as well as the opportunity cost of not having the money somewhere more profitable. These things happen to the best of us. Just learn from it and move on. Some valuable lessons: Just keep trying. Mistakes like this are all part of the learning process. Best of luck.", "Stocks go down and go back up, that's their nature... Why would you sell on a low point? Stocks are a long term investment. If the company is still healthy, it's very likely you'll be able to sell them with a profit if you wait long enough.", "The worth of a share of stocks may be defined as the present cash value of all future dividends and liquidations associated therewith. Without a crystal ball, such worth may generally only be determined retrospectively, but even though it's generally not possible to know the precise worth of a stock in time for such information to be useful, it has a level of worth which is absolute and not--unlikely market price--is generally unaffected by people buying and selling the stock (except insofar as activities in company stock affect a company's ability to do business). If a particular share of stock is worth $10 by the above measure, but Joe sells it to Larry for $8, that means Joe gives Larry $2. If Larry sells it to Fred $12, Fred gives Larry $2. The only way Fred can come out ahead is if he finds someone else to give him $2 or more. If Fred can sell it to Adam for $13, then Adam will give Fred $3, leaving Fred $1 better off than he would be if he hadn't bought the stock, but Adam will be $3 worse off. The key point is that if you sell something for less than it's worth, or buy something for more that it's worth, you give money away. You might be able to convince other people to give you money in the same way you gave someone else money, but fundamentally the money has been given away, and it's not coming back.", "If the company is stable. I like to recoup losses by buying in the valley and selling it all at the plateau and then learning as all beginners do, don't buy stocks because there's a feeding frenzy...or because Joe told me too. Pick your strategy in stocks and learn to stick with that. If you have no strategy, buy land."]

Is the Swiss stock market inversely correlated with the Swiss Franc like Japan today?

['"Roughly about 1 of 2 Swiss francs is won abroad. So, yes it is easier for Swiss companies to export when the Swiss franc is not ""too high"" as it has been those last years. The main export market for Switzerland is the UE. Some companies are doing most or all of their business on the Swiss market. Others are much more exposed to the the health of the global economy. When the Swiss franc appreciates, some companies suffer a lot from that and other less. It depends on their product portfolio, competitors, and other factors. The last decades have shown that how the Swiss Franc valuation is less and less correlated with the performance of the Swiss economy. The Swiss franc is used as a safe haven when the global economy goes bad or is uncertain. In those times, the Swiss franc can be overevaluated, at least as compared to the purchasing power. When the global economy is improving, the over-appreciation of the Swiss franc tends to disapear ; this is happening now (in Mid-2017). As a summary, the Swiss franc itself is not truly correlated with the competitiveness of the Swiss economy, but more about how people in the world are anxious. In this regard, it behaves a little bit like gold."']

How does high frequency trading work if money isn't available for 2-3 days after selling?

['Margin accounts do not have the problem you are imagining, which is unique to cash accounts', 'High frequency trades are intra day. The would buy a stock for 100 and sell for 100.10 multiple times. So If you start with 100 in your broker account, you buy something [it takes 2-3 days to settle], you sell for 100.10 [it takes 2-3 days to settle]. You again buy something for 100. It is the net value of both buys and sells that you need to look at. Trading on Margin Accounts. Most brokers offer Margin Accounts. The exact leverage ratios varies. What this means is that if you start with 10 [or 15 or 25] in your broker you can buy stock of 100. Of course legally you wont own the stock unless you pay the broker balance, etc.', "Purchases and sales from the same trade date will both settle on the same settlement date. They don't have to pay for their purchases until later either. Because HFT typically make many offsetting trades -- buying, selling, buying, selling, buying, selling, etc -- when the purchases and sales settle, the amount they pay for their purchases will roughly cancel with the amount they receive for their sales (the difference being their profit or loss). Margin accounts and just having extra cash around can increase their ability to have trades that do not perfectly offset. In practice, the HFT's broker will take a smaller amount of cash (e.g. $1 million) as a deposit of capital, and will then allow the HFT to trade a larger amount of stock value long or short (e.g. $10 million, for 10:1 leverage). That $1 million needs to be enough to cover the net profit/loss when the trades settle, and the broker will monitor this to ensure that deposit will be enough.", '"As previously answered, the solution is margin. It works like this: You deposit e.g. 1\'000 USD at your trading company. They give you a margin of e.g. 1:100, so you are allowed to trade with 100\'000 USD. Let\'s say you buy 5\'000 pieces of a stock at $20 USD (fully using your 100\'000 limit), and the price changes to $20.50 . Your profit is 5000* $0.50 = $2\'500. Fast money? If you are lucky. Let\'s say before the price went up to 20.50, it had a slight dip down to $19.80. Your loss was 5000* $0.2 = 1\'000$. Wait! You had just 1000 to begin with: You\'ll find an email saying ""margin call"" or ""termination notice"": Your shares have been sold at $19.80 and you are out of business. The broker willingly gives you this credit, since he can be sure he won\'t loose a cent. Of course you pay interest for the money you are trading with, but it\'s only for minutes. So to answer your question: You don\'t care when you have ""your money"" back, the trading company will always be there to give you more as long as you have deposit left. (I thought no one should get margin explained without the warning why it is a horrible idea to full use the ridiculous high margins some broker offer. 1:10 might or might not be fine, but 1:100 is harakiri.)"']

Mortgage refinancing fees

['tl;dr: I think you can find a much better deal. Doing a strait refi will cost you some amount of money. However, a 2.5% fee ont top of closing costs seems really high. You can get a quote from Quicken loans pretty quick and compare their fee. Also I would check with a local bank, preferably one you already do business with. The 2.5% is probably their commission for originating the loan. If you are in the Southeast I have had great luck with Regions bank. They are large enough, but also small enough. Please know that I have no affiliation with either company. BTW the rate also seems high. Doing a quick search of Bank Rate, it seems you can get 3.25% with zero fee as of this writing. The worse deal they show is 3.46 with a .75% fee, much better than you were quoted. If you can afford it I would also encourage you to think outside the box. A client of mine was able to obtain a Home Equity Loan (not line of credit) to replace their mortgage. They went for a 7 year pay off, with the loan in first position, at a rate about .75 below the then current 15 year rate. The key was there was zero closing costs. It saved them quite a bit of money. Also look at a 10 year fixed. It might not be much more than you are paying now.', '"tl;dr: I agree with Pete B.\'s assertion that you should continue shopping. That\'s not the whole story though; there are other factors that can raise your rate, and affect your closing costs. The published rate is typically the best rate you can get. Here are some other factors that can raise your rate: You should have received a loan estimate which will itemize the fees you will pay. On that document you will see if you are paying a price to ""buy down"" the rate, and all the other fees. How are you calculating the 2.5%? Note that some fees are fixed. An appraisal on a $40K home may cost the same as an appraisal for a $400K home. If you add up the total closing costs and view it as a percentage of the loan, the smaller loan may have a higher percentage than the larger loan, even though the total cost of the smaller loan is less."', '"2.5%? Whoa, you are being robbed there. Straight-up, stripped-down, and bent-over-a-table robbed. Never agree to ""fees"". If they don\'t want to do the work to give you a loan, there are other lenders who do. Rarely agree to ""points"". If you know -- and I don\'t mean ""think"", I mean ""know"" -- if you know that you are going to hold that loan much longer than it would take to repay those points, then maybe. For example, if they are charging one point to lower your rate 0.25%, you want to be totally sure you will stay in the house at least four years, and probably more like six or eight years before moving or refinancing. It\'s more-or-less OK to pay for the appraisal. If something goes wrong with the loan application, the appraisal will be valid for a few more months, you can try again. I once had 14% cash for a down-payment. The loan officer said if I could come up with 15%, the rate would be reduced by 0.25%. To get the money, I took a ""reverse point"", which paid me 1% but raised my the rate by 0.25%. The loan officer, who wasn\'t too bright, asked, ""Why did you do that? The two things cancel each other out."" ""I did it,"" I explained, ""because you paid me 1% of the value of my house to sign my name twice."""']

Are BIC and SWIFT code the same things?

['IBAN -> is International Bank Account Number. The number is constructed in such a way that it uniquely identifies your account in the world. I.e. it has a country in it, Bank (and branch) and the actual account number. This is an international standard adopted by the EU, Australia and NZ. Going forward it would be sufficient to just quote the IBAN for payment without any other details. BIC, SWIFT Code, SWIFT BIC, SWIFT ID [all mean the same] is a Bank Identifier Code [More correctly Business Identifier Code] that is again an International standard and used on all International payments. The SWIFT BIC is constructed as Hence SWIFT BIC can be 8 Chars or 11 Chars. The additional 3 Chars help bank identify the Branch where the account is held and where the payment needs to be made. So LOYDGB2L is the main head office If your branch is, say, in Canary Wharf, the SWIFT BIC would be LOYDGB21 [21-> Canary Wharf] with a 3 digit branch added.', 'BIC and IBANN are used in EU (and some other OECD countries) for inter bank transfers. SWIFT is used everywhere for interbank transfers. In the US - IBAN system is not (yet, hopefully) available, so you have to use SWIFT. The codes may look the same, but these are different systems. More details here.']

Do I need another health insurance policy?

["Most of the points by MrChrister are valid. I can't say much for Philippines, however there is a reason for one to go with individual insurance from my experience in India.", "While I can't say how it is in the Philippines, my wife the insurance broker leads me to believe that individual insurance is more expensive than group coverages in the US almost always. So much so that people will go to great extents to form any sort of business just to insure themselves. If however it is cheaper, can't you simply opt out of your employer's plan? If you can opt out, will your employer give you any of the money they aren't paying for your insurance? If you can't opt out, or if you paycheck doesn't grow, I can't see why you would want additional coverage especially at such a young age. Should you lose your job in the near future and you worry about, go get the insurance then. EDIT One big advantage is if you get personal insurance, you might need to get an exam to qualify, and it is likely the younger you are the better you will qualify. But again, you already have insurance that covers you so I would advise keeping the group policy is probably better.", "I understand that if I have multiple health insurance policies, I can only make claim from only one of them if ever I incur medical expenses (I'm from the Philippines). In the US, you cannot simultaneously submit a claim for payment of a medical bill, or request reimbursement for a bill already paid, to multiple insurance companies, but if you are covered by more than one policy, then any part of a claim not paid by one company can be submitted to another company that is also covering you. In fact, if you have employer-paid or employer-provided coverage, most insurance companies will want your employer-provided insurance company to be billed first, and will cover whatever is not paid by the employer coverage. For example, if the employer coverage pays 80% of your doctor's bill, the private insurance will pay the remaining 20%. But, the private insurance policies are also quite expensive. Some professional groups in the US offer major medical coverage to their US members, and might be offering this to non-US members as well (though I suspect not). These policies have large deductibles so that coverage kicks in only when the total medical expenses in that year (whether wholly or partially reimbursed, or not reimbursed at all) exceed the large deductible. These types of policies actually pay out to only a few people - if you have more than, say, $20,000 of medical expenses in a year, you have been quite ill, and thus the premiums are usually much smaller than full-fledged coverage insurance policies which pay out much more frequently because of much smaller deductibles."]

How do you choose which mortgage structure is appropriate when buying a home?

['There are several factors that you need to consider: If you have already decided on the house. Did you prequalify for the mortgage loan - If so, did you lock in the rate. If you have not already done than your research is still valid. Consider two calculators first - Affordability + Mortgage calculator Advice : If you can afford to pay 20% down then please do, Lesser monthly mortgage payment, you can save approx 400 $ per month, the above calculator will give you an exact idea. If you can afford go for 15 years loan - Lower interest rate over 2-5 years period. Do not assume the average ROI will + 8-10%. It all depends on market and has variable factors like city, area and demand. In terms of Income your interest payment is Tax deductible at the end of the year.', 'Go for 15 years loan - Lower interest rate over 2-5 years period. If you can afford to pay 20% down then please do. Do not assume the average ROI will +(8-10%). It all depends on market and has variable factors like city, area and demand.', "Down payment: Emphatically avoid PMI if at all possible; it's pouring money down the drain. Do 20% down if you can, or pay off enough to bring you above 20% and ask for PMI to be removed as soon as you can. Beyond that it's a matter of how much risk you want to accept and how long you'll own the place, and you'll have to run the numbers for the various alternatives -- allowing for uncertainty in your investments -- to guide your decision. Do not assume you will be able to make a profit when you sell the house; that's the mistake which left many people under water and/or foreclosed on. Do not assume that you will be able to sell it quickly; it can take a year of more. Do not assume immediate or 100% occupancy it you rent it out; see many other answers here for more realistic numbers.... and remember that running a rental is a business and has ongoing costs and hassles. (You can contract those out, but then you lose a good percentage of the rent income.) Double mortgage is another great way to dig yourself into a financial hole; it can be a bigger cost than the PMI it tries to dodge and is definitely a bigger risk. Don't."]

Buying my first car out of college

["You're looking at a used car, which is good, but I think you can still be much wiser with the type of car you're looking to purchase. Maybe I'm such a fuddy-duddy because I didn't own a car until I was 25, but let's break this down with a small comparison: If you drive 1,000 miles per month with gas at $4/gallon -- which is absurdly conservative, I think -- for five years, then you're looking at an extra $60/month for just gas, and probably twice the payment, compared with a perfectly reliable but more fuel-efficient car from the same year. (Disclosure: I own a 2004 Corolla and love it. I got mine in 2007 for under $10k, and I paid cash.) $300/month or so is a good chunk of change, no? I'd do even more, and pay that loan off (which will almost certainly be less than $500/month) faster by throwing $500/month at it. You'll save hundreds of dollars in interest. Edit based on your additions: There's one thing that you don't see yet that I have. It's only because you're in your early 20s and I'm pushing 40. It is far easier to sock money away when you're single and don't have a family to take care of. (I'm assuming you're not married yet and that you don't have kids. Hopefully it's not a poor assumption.) I would be saving like crazy now if I were in your position. You have a great job for fresh out of college. My first job started ten years ago after grad school at the same salary you're making. Man, it was so easy to save money back then. Now that I'm married with a daughter, a lot of that cushion goes away. I wouldn't trade it for the world, but that's the price of being head of household. If you have any intentions of not being a hermit for the rest of your life (and I hope you do) then you'd be wise to save as much as you can now.", "Generally speaking, buying a fancy new car out of college is dumb. Buying a 3 year old flashy car with a 60 month loan is going to eat up your income, and when the thing starts breaking down, you'll get sick of buying $900 mufflers and $1,000 taillights pretty quickly. Buy a car that nobody wants for cheap and save up some money. Then buy yourself your dream car. Edit based on question update. You're posting to a Q&A site about money, and you're asking if spending over $30k (don't forget taxes) on a luxury car when you're making $60k is a good idea. You have car fever, and you're trying to sell this transaction as a good deal from a financial POV. At the end of the day, there is no scenario where buying an expensive car is a good financial transaction. For example, since you're planning on driving too many miles for a lease to make sense, the certified pre-owned warranty is a non-factor, because you'll have no warranty when the car breaks down in 4 years. The only reason CPO programs exist is to boost residual values to make leases more attractive -- luxury car makers are in the car leasing (as opposed to selling) business.", "I've seen this approach to buying/funding cars described in a couple of different ways over the years. Random thoughts:", '"DO NOT buy this car. First, I want to say I love BMW\'s. There\'s a reason why they call them ""ultimate driving machine"" and why other car manufacturers compare their new models to BMWs. I own 330i and I absolutely love it. Every time you get into the car, it just begs you to push and abuse it. Everything from steering response to throttle to engine sound. Awesome car. However... 1) BMW is not known for their reliability. I\'ve had to do numerous things to this car and if I didn\'t do the work myself (i like tinkering with cars), it would be a pretty big money pit (and actually still is). German parts are more expensive then regular cars. Labor will run you if you take it for service. Right now my car is on jack stands while I\'m fixing an oil leak, replacing cooling system components which are known to fail and doing work with the cam timing system which uses bad seals. 2) If you buy a used car which is 3 years old, just remember all the wearable items and everything that wants to break, will break 3 years sooner on you. Someone else already pre-enjoyed your car\'s maintenance-free days. At 60k-80k things will start to go. Ask me how I know. So you\'ll start paying for maintenance way before your 5-year loan expires. Compare this 330i to the Acura Integra I used to have. Acura (aka Honda) had 194k miles when I sold it and I NEVER ONCE got stranded with the Acura. 3) Fuel economy is not that good and btw you have to use the most expensive gas. 4) If you are really set on buying a BMW because you enjoy driving and won\'t drive like an old lady (my apologies to those old ladies that drive at least the speed limit, but you are not the majority), then still do not by this one and check out auctions. I bought my 2003 330i in 2005 for 21k when it cost over 40k new. You could probably find one with less than 20k miles on it. My final advice is either a) learn to at least do basic maintenance or b) stick to always buying new cars which don\'t have any issues in first 4-7 years, then move on before you have to schedule your life around your cars. on the bright side I doubt you\'ll have to ever replace the exhaust and you can buy tail lights on e-bay for roughly $60 :)"', '"Read ""Stop Acting Rich"" by Dr Thomas Stanley. I\'m concerned that even before you\'ve earned your first paycheck you want a flashy car. $4800/yr on $63K/yr income is just about half what I\'d recommend to someone who starts working. 10% is the minimum, if and only if, the employer matches 5, for a total 15% saved. Do it in a pretax account and when you go back to grad school convert to Roth."', '"You have a job ""lined up"". What if it falls through? Then you have to sell your fancy car, and you are back to scare, apart from the dough you owe your dad. For consumption items, live within your means. A cheap first car is just fine. Spend cash where it brings you more cash."', '', "I agree with the consensus as far as getting a cheaper car, paying with cash, getting a more fuel efficient car, etc. But I'd like to point out, you should make sure you really need a car at all. I ride a bike to work! If I need a car, I can use Zipcar or City Car Share or borrow a friend's car, rent a car, take the train, ride a bus, walk. But mostly, ride my bike. Burn fat not gasoline! ;)", "Think about it. IF you save $15K by buying a Honda or a Mazda, you can invest those money at modest 5% average, you'll have over 60K before you retire, which allows you to retire at least a year earlier.... So it is worth working an extra year in your life to have a fancier car? And that's a conservative investment.", '"I support the strategy to buy a less expensive car at the outset and then save for that more expensive car. You mentioned that you would be able to save $9000 by the time you had to start making payments. That sounds like a great budget for car shopping. For $9k you can get a dependable used car. If you find the right high-yield savings account you can get around 2% on your $500/month direct deposit. That\'s a difference of about 5% when you add in the 2.9% interest that you would have been paying on the loan. (You can\'t find such a low risk investment that would yield 5% these days.) Also, at that rate (2%) you would have $27k saved up in less than 52 months, or over $31k in 60 months. Then you could buy a BMW with cash! And I\'m sure they would give you a cash discount. Alternatively you could be just finishing paying off the loan and might already be looking at the next car you\'ll take a loan out for. The point is not that you have to completely deprive yourself for the rest of your life. But by not taking out a loan you were certainly come out ahead in 5-10 years time. Also, one common mistake that new grads make is thinking that they are rich right out of college. Yes, you definitely have a nice salary and ""could afford it"" by most people\'s standards. I have a coworker that graduated and started work a year ago. He first bought a brand new Subaru. Why Subaru I do not know, but that is what he thought he wanted. After driving the car for a few months he decided for a few reasons that it was not what he wanted. So he sold the car (for a loss) and bought a slightly used Nissan Z. He has since decided that he needs a more practical car for day to day driving to minimize the abuse that his Z takes. So he has bought another car. This time a low budget Honda. Had he started with a low budget car he could be driving the same car to work right now, but have a good chunk of savings for a new car instead of a loan and a car that he drives only occasionally."', 'Buy the BMW and enjoy it. An MBA? Now that is a true waste of money.', '"I realize I\'m drudging up a somewhat old post here (apologies), but I\'ve found myself in a similar situation recently and thought I would chime in. I was considering buying a car where the loan amount would be right around 25k. I tried justifying this by saying it\'s ridiculously fast (I\'m young and stupid, this is appealing), has AWD (nice for Colorado), and a hatchback with plenty of room for snowboards and whatnot in back. This is in comparison to my Civic which has high mileage, can hardly make it up hills due to the high altitude, sucks in snow, and has little room for anything. You have your reasons, I have mine. The thing is, our reasons are just us trying to rationalize an unwise purchase - just admit it, you know it\'s true. Just so you can see I\'m in a similar financial situation, I\'m 22, just graduated, and started a job making well over 80k with salary and signing bonus, plus 20k in RSUs on the side. After budgeting I can still put away over 2k/month after I\'ve factored in a car payment, insurance, rent, etc etc. Yes, I could ""afford"" this car... it\'s just dumb though dude. Don\'t do it. There are better things we can do with our money. And guess what, I\'ve been drooling over this car since middle school too."', 'Buying this car would be a good idea because you will quickly learn why you feel you need a BMW (that you cannot afford). This is not an investment, but a financing decision, beyond your means of living. As a future MBA you will regret not investing this money now.', "I know I came a little late to this discussion but let me give you my opinion. I think that purchasing the BMW is a terrible investment for obvious reasons. Once you drive the car off the dealer's lot the car loses anywhere from 5-10k in value immediately. Its a terrible investment and something that you will regret in the future. However, whether you buy it now or you hold off we all know you are eventually still going to get it. I graduated college and was in a similar situation as the one you are now. I started making 60k after college and leased a brand new BMW. Like I said it was a terrible investment, but I do not regret it for one day. Ive had so much fun in that car that I can't even begin to explain. We only live once and you don't want to be one of those guys that looks back and says I should've this I should've that, JUST DO IT. We all know it won't be possible when you have a wife and kids so just splurge now and be responsible later LOL."]

what if a former employer contributes to my 401k in the year following my exit?

["The vast majority of individual taxpayers in the United States operate on a cash basis of accounting. This means that the assignment of deductions or income to tax year is based on the date of the paycheck. So the money in that early January 2016 paycheck has been correctly assigned to the 2016 tax year. This is unfortunate for you because you will receive a W-2 for 2016 showing that you had a retirement account. Knowing exactly how many paychecks there are in a year can be very import to know when trying the reach or avoid some thresholds. Even quitting the previous pay period might not have helped. I have seen some companies payout unused vacation, sick and severance over several paychecks. They didn't give you it all in one lump sum, they did it 80 hours a paycheck until the balance owed to the employee was zero.", '"Publication 590a covers this in a fairly specific manner. Page 11, section ""Are You Covered by an Employer Plan?"", specifies: The Form W-2 you receive from your employer has a box used to indicate whether you were covered for the year. The “Retirement Plan” box should be checked if you were covered. So, by default, if that\'s checked, you\'re covered. 590 does go into more detail, though. Assuming you\'re covered under a Defined Contribution plan (a 401k for example): Defined contribution plan. Generally, you are covered by a defined contribution plan for a tax year if amounts are contributed or allocated to your account for the plan year that ends with or within that tax year. Tax Year: Tax year. Your tax year is the annual accounting period you use to keep records and report income and expenses on your income tax return. For almost all people, the tax year is the calendar year. Further, they cover issues related to an employee leaving Dec. 31 very specifically: A special rule applies to certain plans in which it is not possible to determine if an amount will be contributed to your account for a given plan year. If, for a plan year, no amounts have been allocated to your account that are attributable to employer contributions, employee contributions, or forfeitures, by the last day of the plan year, and contributions are discretionary for the plan year, you are not covered for the tax year in which the plan year ends. If, after the plan year ends, the employer makes a contribution for that plan year, you are covered for the tax year in which the contribution is made. Example: Example. Mickey was covered by a profit-sharing plan and left the company on December 31, 2014. The plan year runs from July 1 to June 30. Under the terms of the plan, employer contributions do not have to be made, but if they are made, they are contributed to the plan before the due date for filing the company\'s tax return. Such contributions are allocated as of the last day of the plan year, and allocations are made to the accounts of individuals who have any service during the plan year. As of June 30, 2015, no contributions were made that were allocated to the June 30, 2015, plan year, and no forfeitures had been allocated within the plan year. In addition, as of that date, the company was not obligated to make a contribution for such plan year and it was impossible to determine whether or not a contribution would be made for the plan year. On December 31, 2015, the company decided to contribute to the plan for the plan year ending June 30, 2015. That contribution was made on February 15, 2016. Mickey is an active participant in the plan for his 2016 tax year but not for his 2015 tax year. Mickey is in a similar (but different) circumstance, and it\'s clear from the IRS\'s treatment of his circumstance that you would be in the same boat (just a year less off) - but be aware given Mickey\'s situation that it\'s theoretically possible for them to make another contribution next year, as Mickey had, depending on when their plan year/etc. ends. So - from the IRS\'s point of view, everything you said the company did is correct. They paid you in January, contributed to your 401k as a result of that paycheck, and thus you were officially considered covered for 2015."', "According to the IRS, you can still put money in your IRA. Here (https://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits) they say: Can I contribute to an IRA if I participate in a retirement plan at work? You can contribute to a traditional or Roth IRA whether or not you participate in another retirement plan through your employer or business. However, you might not be able to deduct all of your traditional IRA contributions if you or your spouse participates in another retirement plan at work. Roth IRA contributions might be limited if your income exceeds a certain level. In addition, in this link (https://www.irs.gov/Retirement-Plans/IRA-Deduction-Limits), the IRS says: Retirement plan at work: Your deduction may be limited if you (or your spouse, if you are married) are covered by a retirement plan at work and your income exceeds certain levels. The word 'covered' should clarify that - you are not covered anymore in that year, you just got a contribution in that year which was triggered by work done in a previous year. You cannot legally be covered in a plan at an employer where you did not work in that year."]

found a 1994 uncashed profit sharing retirement plan check

['"Checks (in the US, anyway) are only good for six months after they have been written. After that. under the US Uniform Commerical Code they are considered ""stale checks"" and banks need not accept them. My experience is that they generally won\'t -- but you probably shouldn\'t count on that, either when figuring out whether to try depositing an old check or figuring out how much cash you need to keep in your checking account to cover recent stale checks. The check you now hold is certainly a statement of intent to pay you and thus is a useful document to supplement other evidence that they still owe you the money -- but since checks can be cancelled and/or a replacement check may have been issued, its value for that purpose may be limited. You can try depositing it and see what happens. If that doesn\'t work (or you don\'t want to bother trying it) you can contact the retirement plan, point out that this check went uncashed, and ask them to send you a replacement. If they haven\'t already done so (you might want to check your own records for that), there shouldn\'t be any problem with this. (Note: Many business checks have a statement printed on them that they\'re only good for 90 days or so. If yours does, you can skip trying to cash it; just contact the retirement plan offices.)"']

Is there a Canadian credit card which shows holds?

['"PC MasterCard recently added this as a new feature to their online system. It lets you see ""Pending Authorizations"" for your card when you log in. Their email said: Along with your purchases, you\'ll see a list of every transaction that\'s been approved, but not yet applied to your balance. You\'ll be able to identify these with the word “Pending” in the date column. Here\'s a link with more information: http://pcfinancial.ca/pendingauthorization/"', "It's not so much a credit card, but a financial institution's online platform that either provides this functionality or not. The following Canadian financial institutions show an itemized list of pre-authorized transactions (not an exhaustive list): The following institutions show a total value of pre-authorized transactions: Most other institutions show the available credit (e.g. Chase Financial used by Amazon Rewards), which give an indication of how much you have to spend. By subtracting the current balance and the available balance from the total credit limit, you can get an indication of the total amount of pre-authorized transactions. Example: $1000 - $500 - $400 = $100 is the amount of pre-authorized transactions. From TD's EasyWeb demo (http://tdeasywebdemo.com/v2/#/en/PFS/accounts/activity/chq), it appears that they don't include pre-authorized transactions in the Available Credit. You can verify for yourself by logging in to online banking after you make a purchase and comparing the Available Credit to [Credit Limit - Current Balance]. If it is equal, then they don't include, if it is different (most likely for the value of the transaction), then they do.", '"As for PC Mastercard like stated by @nullability, VISA Desjardins list the ""Pending Authorizations"" almost instantly (the time it\'s take to get back home) in AccesD (Their Web portal for managing accounts)."']

How does a brokerage firm work?

['"Brokerages offer you the convenience of buying and selling financial products. They are usually not exchanges themselves, but they can be. Typically there is an exchange and the broker sends orders to that exchange. The main benefit that brokers offer is a simpler commission structure. Not all brokers have their own liquidity, but brokers can have their own allotment of shares of a stock, for example, that they will sell you when you make an order, so that you get what you want faster. Regarding accounts at the exchanges to track actual ownership and transfer of assets, it is not safe to assume thats how that works. There are a lot of shortcomings in how the actual exchange works, since the settlement time is 1 - 3 business days, depending on the product (so upwards of 5 to 6 actual days). In a fast market, the asset can change hands many many times making the accounting completely incorrect for extended time periods. Better to not worry about that part, but if you\'d like to read more about how that is regulated look up ""Failure To Deliver"" regulations on short selling to get a better understanding of market microstructure. It is a very antiquated system."', 'The brokerage executes the transactions you tell them to make on your behalf. Other than acting as your agent for those, and maintaining your account, and charging a fee for the service, they have no involvement -- they do not attempt to predict optimal anything, or hold any assets themselves.', '"Real target of commisions is providing ""risk shelter"". It is kind of ""insurance"", which is actually last step for external risks to delete all your money. In part it cuts some of risks which you provide, brokers track history of all your actions for you (nobody else does). When brokerage firm fails, all your money is zero. It depends from case to case if whole account goes zero, but I wouldn\'t count on that."']

Should we park our money in our escrow account?

["The likely outcome of adding extra money to your escrow account is that the bank will send you a check for excess funds at the end of the year (or whenever your property tax and insurance payments are processed). Could you just redeposit that money immediately? Possibly. I bet most banks wouldn't care and would just follow the routine of clearing the excess from the account next time they process payments. I've never received a 1099 for interest in an escrow account. It is possible that when you start earning enough interest that a 1099 is required by law ($10/year) that the bank gets a little more aggressive about pushing your money back to you. I'm not sure why that hassle is any better than just opening up your average internet savings account (many don't have any of the fees you mentioned) and parking it there with a similar interest rate. You can deposit and withdraw using ACH transactions that post by the next business day. That said, unless they do start rejecting your money, there aren't a lot of downsides in your plan.", 'You should talk to a financial fiduciary (make sure they are a fiduciary, not all planners are) about investing your money. Even ultra safe investments such as treasury bonds will beat the 1% interest rate offered by your savings account (the yield on the 5 year treasury is currently around 2%).']

What is a stock warrant? How do warrants work?

['In general, a warrant is a security issued by a company allowing the holder to purchase a certain number of a particular class of shares at a certain price for a particular period of time. They differ from exchange traded options (i.e. calls and puts) in that they are issued by the company that issued the underlying shares that they allow you to purchase whereas calls and puts are generally written by other investors. The other big difference between options and warrants is that options are standardized. Any call or put you buy on a particular exchange has basically the same set of rules governing use. By contrast, a warrant may have all kinds of stipulations that must occur before you can execute, such as price events (e.g. only if the stock hits a certain price) or business events (e.g. only if the company elects to defer payment on a bond issued at the same time as the warrant). Warrants are generally a bad choice for small and inexperienced investors since each warrant issue is different and you often need a lawyer or other qualified professional to fully understand all to possible outcomes.', "In Australia there are 2 type of warrants (I don't know if it is the same in the US, UK and other countries), the first are trading warrants and the second are instalment warrants. The trading warrants are exactly what it says, they are used for trading. They are similar to option and have calls and puts. As Cameron says, they differ from exchange traded options in that they are issued by the financial companies whereas options are generally written by other investors. Instalment warrants on the other hand are usually bought and sold by investors with a longer term view. There are no calls and puts and you can just go long with them. They are also issued by financial companies, and how they work is best explained through an example: if I was to buy a stock directly say I would be paying $50 per share, however an instalment warrant in the underlying stock may be offered for $27 per warrant. I could buy the warrant directly from the company when it is issued or on the secondary market just like shares. I would pay the $27 per warrant upfront, and then in 2 years time when the warrant expires I have the choice to purchase the underlying stock for the strike price of say $28, roll over to a new issue of warrants, sell it back on the secondary market, or let it expire, in which case I would receive any intrinsic value left in the warrant. You would have noticed that the warrant purchase price plus the strike price adds up to more than the share price ($55 compared to $50). This is the interest component inherent in the warrant which covers the borrowing costs until expiry, when you pay the second portion (the strike price) and receive the underlying shares. Another difference between Instalment warrants and trading warrants (and options) is that with instalment warrants you still get the full dividends just like the shares, but at a higher yield than the shares."]

Where can I find information on corporate bonds (especially those rated as “junk”) ?

["Bond information is much tougher to get. Try to find access to a Bloomberg terminal. Maybe you have a broker that can do the research for you, maybe your local university has one in their business school, maybe you know someone that works for a bank/financial institution or some other type of news outlet. Part of the reason for the difference in ease of access to information is that bond markets are dominated by institutional investors. A $100 million bond issues might be 90% owned by 10-20 investors (banks, insurance co's, mutual funds, etc.) that will hold the bonds to maturity and the bonds might trade a few times a month/year. On the other hand a similar equity offering may have several hundred or thousand owners with daily trading, especially if it's included in an active stock index. That being said, you can get some information on Fidelity's website if you have an account, but I think their junk data is limited. Good luck with the hunt."]

Short-sell, or try to rent out?

['A short sale will be pretty bad for your credit report. It will linger for 7 years. This may ruin your opportunity to buy in the new area. On the other hand you need to run the numbers, the last I looked into this, the bank will look at rent and discount it by 25%. So the shortfall of $800/mo (after adjustment) will reduce your borrowing power if you rent it out. In general this is the idea. You rent for a year, and buy into the new area. If you short sell after this, while your credit is trashed, you still have your new home, and $50K less debt. (Disclaimer - There are those who question the ethics of this, a willing short sale. I am offering a purely business answer and making no judgment either way. I owed $90K on a condo where others were selling for $20K. I paid until it came up enough that a lump sum got me out upon sale. The bank got its money in full) An article on the differences between foreclosure and short sale.', 'There is another option. Stay where you are.']

I cosigned on a house for my brother

["This is why we tell people not to co-sign unless they are able and willing to risk that money becoming a gift... or are able and willing to treat it as business rather than family. Unfortunately that advice is a bit late now to help you. When you cosigned, you promised the bank that you would make any payments he didn't. The bank doesn't care why he didn't, they just want their money on time. Getting him to repay you for covering this is strictly between the two of you, and unless you signed paperwork at the time establishing a contract other than the promise to cover his loan this becomes Extremely Messy. First step is to make the payments so the loan doesn't continue acquiring fees and hurting your credit rating, and keep it from falling behind again. Then you have to convince him to repay the money you have effectively given him. Depending on your relationship, and financial situations, you may decide to carry him for a while and trust that he'll pay you back when he can, or sic a lawyer on him. You need to make that decision, recognizing that it may be a matter of how much family drama you are willing to tolerate.", "He wasn't wrong that a mortgage would help your credit score, assuming that this was a perfect world and everyone held up their end of the bargain. However, now that he hasn't, you are still legally obligated to pay the loan amount (including his portion of it). As for a lawsuit, it would be hard to prove what he said verbally, however, it doesn't hurt to call a lawyer for a free consultation."]

Are tax deductions voluntary?

['"I did a little research and found this article from 2006 by a Villanova law professor, titled ""No Thanks, Uncle Sam, You Can Keep Your Tax Break"". The final paragraph of the article says: Under these circumstances, it is reasonable to conclude that a taxpayer is not required to claim a allowable deduction unless a statutory provision so requires, or a binding judicial precedent so specifies. It would be unwise, of course, to forego a deduction that the IRS considers mandatory such as those claimed by self-employed individuals with respect to their self-employment, whether for purposes of the self-employment tax or the earned income tax credit. Until the statute is changed or some other binding authority is issued, there is no reason taxpayers who wish to forego deductions, such as the dependency exemption deduction, should hesitate in doing so. (The self-employment tax issues in the quote cited by CQM are explicitly discussed in the article as one of a few special kinds of deduction which are mandatory.) This is not a binding statement: it\'s not law or even official IRS policy. You could never use it as a defense in the event that this professor turned out to be wrong and the IRS decided to go after you anyway. However, it is a clear statement from a credible, qualified source."', '"There are many people who have deductions far above the standard deduction, but still don\'t itemize. That\'s their option even though it comes at a cost. It may be foolish, but it\'s not illegal. If @littleadv citation is correct, the \'under penalty of perjury\' type issue, what of those filers who file a Schedule A but purposely leave off their donations? I\'ve seen many people discuss charity, and write that they do not want to benefit in any way from their donation, yet, still Schedule A their mortgage and property tax. Their returns are therefore fraudulent. I am curious to find a situation in which the taxpayer benefits from such a purposeful oversight, or, better still, a cited case where they were charged with doing so. I\'ve offered advice on filings return that wasn\'t ""truthful"". When you own a stock and cannot find cost basis, there are times that you might realize the basis is so low that just entering zero will cost you less than $100 in extra tax. You are not truthful, of course, but this kind of false statement isn\'t going to lead to any issue. If it gets noticed within an audit, no agent is going to give it more than a moment of time and perhaps suggest, ""you didn\'t even know the year it was bought?"" but there would be no consequence. My answer is for personal returns, I\'m sure for business, accuracy to the dollar is actually important."', '"What kind of ""deductions"" are you talking about? Many deductions, like the standard/itemized deductions, come after the AGI, and do not affect the AGI, so I don\'t see how this would make any difference. Maybe you are talking about deductions that come before the AGI? If you want to increase your AGI legitimately, here\'s a way: Every year, itemize deductions on your federal return, and over-withhold your state income tax (assuming your state has income tax) by a lot, and/or make voluntary extra payments to your state income tax. As a result, you will get a huge refund on your state taxes the following year. Then you will need to include this refund as income on line 10 of the federal return that year, which will be included in the AGI. (Of course, you will also be able to deduct a lot of state income tax paid every year in the federal itemized deductions, but those come after the AGI.)"', '"Legally: gods know. I would strongly recommend asking the Law asre of Stack Exchange to advise on that. Practically: What\'s the worst that happens? They audit, you say ""Yeah, I could probably have claimed these deductions but I didn\'t want to; is that a problem?"", they decide and either nothing happens or they issue you the unwanted refunnd. They aren\'t going to fine you for overpaying. Unless this would expose something criminal -- or you\'re a public figure and it would be embarassing -- this strikes me as falling firmly within the bounds of ""no harm, no foul""."']

Can a wealthy investor invest in or make a deal with a company before it goes public / IPO?

["Yes, an investment can be made in a company before IPO. The valuation process is similar as that done for arriving at IPO or for a normal listed company. The difference may be the premium perceived for the idea in question. This would differ from one investor to other. For example, whether Facebook will be able to grow at the rate and generate enough revenues and win against competition is all a mathematical model based on projections. There are quite a few times the projection would go wrong, and quite a few times it would go correct. An individual investor cannot generally borrow from banks to invest into a company (listed or otherwise) (or for any other purpose) if he does not have any collateral that can be kept as security by the bank. An individual can get a loan only if he has sufficient collateral. The exceptions being small personal loans depending on one's credit history. The Private Equity placement arm of banks or firms in the business of private equity invest in start-up and most of the time make an educated guess based on their experience. More than half of their investments into start-ups end up as wiped out. An occasional one or two companies are ones that they make a windfall gain on.", '"Yes, it is common for investors to make equity investments in technology companies pre-IPO. There are technology incubators like Y Combinator that exist to make ""angel"" investments, which are early-stage equity investments in private technology companies (these investments are sometimes in notes that are convertible to equity, but are very similar to a stock investment). Wealthy individuals can also make angel investments (e.g. Peter Thiel made a $500K investment in Facebook in 2004 for 10.2% of the company). Additionally, venture capital firms exist to make equity investments in private companies. In the US, you need to be an Accredited Investor to make private equity investments (income greater than $200K or net worth greater than $1 million), but you probably need a lot more money than the minimum and connections to get in on these deals in reality."', '"IPO is ""Initial Public Offering"". Just so you know. The valuations are done based on the company business model, intellectual property, products, market shares, revenues and profits, assets, and future projections. You know, the usual stuff. Yes, it is. And very frequently done. In fact, I can\'t think of any company that is now publicly traded, that didn\'t start this way. The first investor, the one who founds the company, is the first one who invests in it after raising the capital (even if it is from his own bank account to pay the fees for filing the incorporation papers). What is the difference between ""normal"" investor and ""angel""? What do you refer to as ""angel""? How is it abnormal to you? Any investor can play a role, depending on the stake he/she has in the company. If the stake is large enough - the role will be significant. If the stake is the majority - the investor will in fact be able major decisions regarding the company. How he bought the stocks, whether through a closed offering, initial investment or on a stock exchange - doesn\'t matter at all. You may have heard of the term ""angels"" with regards to high-tech start up companies. These are private investors (not funds) that invest their own money in start ups at very early stages. They\'re called ""angels"" because they invest at stages at which it is very hard for entrepreneurs to raise money: there\'s no product, no real business, usually it is a stage of just an idea or a patent with maybe initial prototype and some preliminary business analysis. These people gamble, in a sense, and each investment is very small (relatively to their wealth) - tens of thousands of dollars, sometimes a hundred or two thousands, and they make a lot of these. Some may fail and they lose the money, but those that succeed - bring very high returns. Imagine investing 10K for 5% stake at Google 15 years ago. Those people are as investors as anyone else, and yes, depending on their stake in the company, they can influence its decisions."']

How many days do I have to hold a stock before it is considered a capital gain by the CRA?

["You don't have to wait. If you sell your shares now, your gain can be considered a capital gain for income tax purposes. Unlike in the United States, Canada does not distinguish between short-term vs. long-term gains where you'd pay different rates on each type of gain. Whether you buy and sell a stock within minutes or buy and sell over years, any gain you make on a stock can generally be considered a capital gain. I said generally because there is an exception: If you are deemed by CRA to be trading professionally -- that is, if you make a living buying and selling stocks frequently -- then you could be considered doing day trading as a business and have your gains instead taxed as regular income (but you'd also be able to claim additional deductions.) Anyway, as long as your primary source of income isn't from trading, this isn't likely to be a problem. Here are some good articles on these subjects:"]

What effect would sovereign default of a European country have on personal debt or a mortgage?

["Patrick, This article points out three likely effects (direct and indirect) sovereign default can have on the individual: http://tutor2u.net/blog/index.php/economics/comments/the-sovereign-default-option-is-costly/ This looks at how a default may not look like a default - even if it is. But again, how defaults can impact the man in the street: http://online.wsj.com/article/SB10001424052748703323704574602030789251824.html The fascinating Argentine default is described in a blow-by-blow format here, including brief references to things like unemployment and personal savings: http://theinflationist.com/sovereign-default/argentine-sovereign-default-2002-argentina-financial-crisis Remember, though. Not all defaults are the same. And a modern-European country's default may look very different to what has occurred elsewhere.", '"This is a hard question to answer. Government debt and mortgages are loosely related. Banks typically use yields on government bonds to determine mortgage interest rates. The banks must be able to get higher rates from the mortgage otherwise they would buy government bonds. Your question mentions default so I\'m assuming a country has reneged on its promise to pay either the principal or interest on government bonds. The main thing to consider is ""Who does not get their money?"". In other words, who does the government decide not to pay. This is the important part. The government will have some money so they could pay some bond holders. They must decide who to shaft. For example, let\'s look at who holds Greek government debt. Around 70% of Greek government debt is held outside Greece. See table below. The Greek government could decide to default only on the debt to foreign holders. In that case the banks in France and Switzerland would take the loss on their bonds. This could cause severe problems in France and Switzerland depending on the percentage of Greek bonds that make up the banks\' assets. Greek banks would still face losses, however, since the price of their Greek bond holdings would drop sharply when the government defaults. Interestingly, the losses for the Greek banks may be smaller than the losses faced by the French and Swiss banks. This is usually the favored option chosen by government since the French and Swiss don\'t vote in Greece. Yields on Greek government bonds would rise dramatically. If your Greek mortgage is an adjustable rate mortgage then you could see some big adjustments upward. If you live in France or Switzerland then the bank that owns your mortgage may go under if Greece defaults. During liquidation the bank will sell their assets which includes mortgages and you will probably not notice any difference in your mortgage. As I stated earlier: this is a hard question to answer since the two financial instruments involved (bonds and mortgages) are similar but may or may not be related."', '"If the default happens through mass monetary inflation rather than openly (""We\'re not paying interest on our bonds"") then make sure you pay off your house. There may not be a very long window to do so. If the currency becomes worthless, then it depends on what you have of value that would be accepted by the lender as payment. If you don\'t have anything, the lender will take it back, as they\'re probably entitled to on the notes."']

Home Valuation in a Dodgy neighborhood

['"Bad areas are tough to value as a owner-occupied property, because the business model for being a slumlord is to rent apartments in absentia, usually to tenants receiving goverment subsidies such as Section 8 vouchers. The vouchers are based on a prevailing rent, which are often on par with nice suburban apartment complexes due to how that ""prevailing"" rate is calculated. So the value of the house is really an annuity calculation. You figure out the potential rental cash flow and apply whatever your local market premium is. The point is, doing an apples to apples comparison is going to be tough, and justifying the cost of repairs that aren\'t remediating health and safety issues probably won\'t be recoverable from a home valuation standpoint. A buyer would probably rip out your central air conditioner and sell it! If I were in your shoes, I\'d look at the time horizon that you think you\'re going to be there and amortize the cost over that period. Assuming your mortgage is small and you\'re staying for about 5 years, spending $10k costs you about $170 a month. Your reward is a modern A/C and heating system. Compare that cost to the cost of moving and your desires and see if it\'s worth it to you."', "Over the last ten years you have reaped the benefits of a good financial decision. (Presumably your low mortgage has freed up money for other financial priorities.) There would be no harm in making a clean break by selling as is. On the other hand, the resale value would probably be rather low considering the condition and the neighborhood. I don't want to assume too much here, but if a potential buyer is interested in the house by virtue of not being able to afford a house in a better neighborhood or better condition, their finances and credit history may make it difficult for them to be approved for a mortgage. That would reduce the potential buyer pool and further reduce the sale price. If you can pull more in rent than the mortgage, you definitely have an opportunity to come ahead. Maybe window A/C units and a repaired chimney are enough if you're renting. Your rental income would pay for that in less than a year even while paying your mortgage for you. (Of course you don't want to become a sleazy slumlord either.)", "I wouldn't personally spend any money on an appraisal. Spend some time yourself looking at Zillow.com and maybe Realtor.com and other sites to review recent sales in your specific area. Not the houses a mile away. Try to find comparables to yours. The key factor is dollars per square foot. See if the trend over the last couple of years is upwards or downwards in dollars per square foot of living area. If it's downwards, I wouldn't invest for sure."]

Shorting Obvious Pump and Dump Penny Stocks

["Shorting penny stocks is very risky. For example, read this investopedia article, which explains some of the problems. In general: If you have some sort of method for perfectly identifying Pump and Dump schemes, it's possible you could make money if you time things right, but that timing is going to be very difficult to identify.", "Assuming you have no non-public material information, it should be perfectly legal. I suspect it's not a great idea for the reasons that Joe outlined, but it should be legal."]

I just made $50K from selling my house. How should I invest the proceeds?

["It sounds like you want to lock-up your money in something relatively safe, and relatively hard to touch. You may want to consider a GIC (TD has one I found in a quick search) - from what I see it's the closest thing to a US CD. You won't get much back, but if you pick a 5-year term, you can't spend it* easily. Other options might be to buy an ETF, or get into REITs - but that will depend on your risk comfort. Also - to add from the comment Rick left - be sure to pay off any high-interest debts: especially if they're on a credit card, it will help you later on. * easily .. you can withdraw, but there're generally penalties", "I know an answer has been accepted, but you need an emergency fund, ideally enough to cover at least 3 months of after-tax basic living expenses. As a free-lancer, 6 months would be even better. This isn't a fun way to tie up your money, but it is a prudent way. What if you lose your job, or decide you want to change your line of work? What if you're told a close family member has only months to live and you want to take significant time off unpaid? What if your car breaks down and you need a new one? What if your freelance business hits a dry patch for a few months? What if you want to move but can't sell your next house quickly? I've known people who had these types of situations come up unexpectedly. Some were financially prepared and had the freedom to make the choices they wanted to make, others didn't and now have regrets. Once you have a basic emergency fund in place, then go for investing with the rest of the money. Best of luck!", "First pay off all existing debt. Then set up at least 6 month emergency fund. Freelancing exposes you to way more risks than employment. Then buy GIC's to cover and match the maturity of your expected education fees. Only 'play' with what is left. Don't over think it. Buy a low-cost (less than 0.5%) passive large-index mutual fund covering either the S&P or TSX."]

How can I check my credit score?

["http://annualcreditreport.com/ That's the official site for getting your free yearly credit report (one free per year from each of the 3 reporting bureaus).", "Assuming you are asking about a credit score in the United States, the following applies. To find out your FICO score, navigate to AnnualCreditReport, the official site to help consumers receive their credit report from each of the three organizations providing these scores - Equifax, Experian, and TransUnion. You are - in many states - entitled to a free copy of your credit report from each of these organizations annually. This copy of your credit report will not contain your credit score from that organization. It will, however, contain information that goes into your credit score - the lines of credits on file, any delinquencies reported, etc. If you decide you would like to pay for your credit score from each bureau, you will have the option to receive this information while getting your credit report, but you will have to pay a nominal fee for it. Remember that each of the 3 bureaus gives you a different score. Averaging your 3 scores should give you a good idea of your FICO score. Note that your report is far more important than your score - once you know that, you know if you're in a good place or not. These other questions are so close that they might even be considered duplicates, and provide other suggestions for how to check your score. As a warning, don't trust the many ads out there saying you can get your score for free. Only AnnualCreditReport is considered a safe place for entering the very personal information required to get a score. The FTC backs this up.", 'Since no one else answered this part of your question yet: Checking your own credit score or report will not affect it in any way. It only hurts you when someone looks it up to run a credit check at your request for the purpose of possibly getting a loan, for example a car dealership. This only hurts it a tiny bit, and is not worth worrying about unless you are going to 20 different car dealerships who each do a check. However, it is a good idea not to let them run your credit until you are seriously ready to buy a car. In fact, it is better to just get financing somewhere else and not let them run it at all.', '"Different states have different laws, check your local laws concerning credit. Some states even guarantee you to get one free credit report per year. If you recently apply for an apartment, a mortgage or denied a credit card or loan, you can usually get a free copy from whomever you authorized to pull your credit report. Sign up credit monitoring service, there are quite a few of these. Most credit card companies offer such service, Amex, Chase, Citibank, etc. It\' costs around $10-$20 per month. If you sign up a service and pull your own credit report, it\'s considered a ""soft"" pull which won\'t affect your score negatively."', "Check with your bank. As of January, 2015, the following banks and credit unions are offering free credit-scores: Announced, in the pipeline: Source: Banks to offer FICO credit scores for free Personal Experience: I've been receiving free FICO score from my credit union for more than 6 months now. Advice: Most people have multiple bank/credit-union accounts. The FICO score will be the same whoever offers it. If none of your financial institutions offer you a free credit-score then you may opt for free services like creditkarma.com or other paid services. Please note that a credit-score is number summarizing your credit-report and should not be confused. In the news:"]

Oh, hail. Totaled car, confused about buy-back options

["It seems like there are a few different things going on here because there are multiple parties involved with different interests. The car loan almost surely has the car itself as collateral, so, if you stop paying, the bank can claim the car to cover their costs. Since your car is now totaled, however, that collateral is essentially gone and your loan is probably effectively dead already. The bank isn't going let you keep the money against a totaled car. I suspect this is what the adjuster meant when he said you cannot keep the car because of the loan. The insurance company sounds like they're going to pay the claim, but once they pay on a totaled car, they own it. They have some plan for how they recover partial costs from the wreck. That may or may not allow you (or anyone else) to buy it from them. For example, they might have some bulk sale deal with a salvage company that doesn't allow them to sell back to you, they may have liability issues with selling a wrecked car, etc. Whatever is going on here should be separate from your loan and related to the business model of your insurance company. If you do have an option to buy the car back, it will almost surely be viewed as a new purchase by the insurances company and your lender, as if you bought a different car in similar condition."]

How long should I keep my bills?

['Consumerist posted a list of how long to keep bills.', "In general, you don't need to keep bills around for more than a few months. The exceptions are: anything that was itemized on your federal or state income taxes. You want to keep these around for seven years in case of an audit by the IRS brokerage statements buying/selling stocks, bonds, mutual funds, etc. You need to know how much you bought a stock for when you sell it, to calculate capital gains. information relating to major renovations to your house. This can be used to reduce the gain when you sell. anything relating to a business, again for tax and valuation purposes. When selling a house, the last years worth of utility bills might be useful, to show potential buyers. However, I get almost all of my recurring bills electronically now. They get saved and backed up. In that case, its easier to just keep everything than to selectively delete stuff. It takes very little space, is easier to find things than in paper files, and is much less hassle when moving than boxes full of paper.", "In normal cases you don't need it beyond 3-6 months. Beyond this destroy it. However in certain cases its required to be kept; For example if you need to prove that you are legally occupying a place/property and do not have relevant documents, the utility receipts can play a role in establishing that you were occupying a place and using it. In case you are not originaly a resident by birth, and your citizenship is at dispute, these records help. More so if the records are not maintained properly by the utitlity companies themsleves as in most developing countries. In India, these help for many individual who are occupying goverment properties for decades and then resolution is passed that people staying for past 25 yrs now own it, other become illegal and are evicted. For such cases, you could keep a history record say one per year, for past 5 years, and then one for every 5 year of a particular month ... basically in a systematic way. Other than that, just junk them.", "I'd imagine you want to keep the utility bills around to dispute any historical billing errors or anomalies for perhaps 6 months to a year. Beyond that, you always have the financial records of making the payments -- namely, your bank statements. So what benefit is there in keeping the paper receipts for utility payments around for longer than that? I say shred them, with extreme prejudice -- while wearing black Chuck Norris style.", "Shred it all. You might want to keep a record going back at most a year, just in case. But just in case of what? What is a good idea is to have an electronic record. It's a good practice to know how your spending changes over time. Beyond that, it's just a fire hazard. The thing is, I know I'm right in the above paragraph, but I'm a hypocrite: I have years' worth of paper records of all kinds. I need to get rid of it. But I have grown attached. I have trucked this stuff around in move after move. I have a skill at taking good care of useless things. I've even thought of hiring somebody to scan it all in for me, so that I can feel safe shredding all this paper without losing any of the data. But that's insane!"]

Where can I open a Bank Account in Canadian dollars in the US?

["If you can make the trip to BC yourself, I'd recommend opening an account with TD Canada Trust. They allow non-citizens to make accounts — apparently the only Canadian bank to do so. The customer service is great and they have a good online banking site that will allow you to manage it from the US. If you have an account with TD Bank in the US, it's also very easy to set up a TD Canada account through them that will be linked on their online site (though you will still have separate logins for both and manage them separately). I've done the reverse as a Canadian living in the US. You can set it up over the phone; their Cross-Border Banking number is listed here. They also offer better currency conversion rates than their standard ones when you do a cross-border transfer. You could also look into HSBC as well. They operate in Washington as well as across the border in BC. If you can't open a CAD account locally, they can help you open and manage one in Canada from the US. It may or may not require having a small business account instead of a personal account.", 'Everbank has offered accounts in foreign currencies for a while. https://www.everbank.com/currencies Takes a while to get it setup; and moving cash in and out is via wire transfer. Also you need to park $5K in USD in a money market account; which you use as a transfer point.', 'Give Harris Bank a call; they might be able to help you As of August 21, 2015, Harris bank does NOT offer Canadian dollar accounts in the U.S.', "Royal Bank in Canada can open an account for you in the US through RBC (the US affiliate to Royal Bank of Canada) I think it's called RBC Access USA.", 'Canada, like other second-rate economies with weak currencies, provides USD accounts. It is not the same vice versa. It is rare to find a direct deposit foreign currency account in the US as it is the world-leading currency.']

How to double-entry bookkeep money incoming from sold items

["If you were a business, all your assets would have a dollar value, so when you sold them you'd decrease the amount of assets by that amount and increase in cash, and if there was a profit on the sale it would go in as income, if there was loss it would count as a cost (or a loss)... so if there was a profit it would increase Equity, a loss then it would decrease Equity. Since it's not really worthwhile doing a estimated cost for everything that you have, I'd just report it as income like you are doing and let the amount of equity increase proportionately. So, implicitly you always had roughly that amount of equity, but some of it was in the form of assets, and now you're liquidating those assets so the amount shows up in GnuCash. When you buy new things you might sell later, you could consider adding them as assets to keep track of this explicitly (but even then you have problems-- the price of things changes with time and you might not want to keep up with those price changes, it's a lot of extra work for a family budget) -- for stuff you already have it's better to treat things as you are doing and just treat the money as income-- it's easier and doesn't really change anything-- you always had that in equity, some of it was just off the books and now you are bringing it into the books."]

Investing: P/E Ratio basic question

["The idea here is to get an idea of how to value each business and thus normalize how highly prized is each dollar that a company makes. While some companies may make millions and others make billions, how does one put these in proper context? One way is to consider a dollar in earnings for the company. How does a dollar in earnings for Google compare to a dollar for Coca-cola for example? Some companies may be valued much higher than others and this is a way to see that as share price alone can be rather misleading since some companies can have millions of shares outstanding and split the shares to keep the share price in a certain range. Thus the idea isn't that an investor is paying for a dollar of earnings but rather how is that perceived as some companies may not have earnings and yet still be traded as start-ups and other companies may be running at a loss and thus the P/E isn't even meaningful in this case. Assuming everything but the P/E is the same, the lower P/E would represent a greater value in a sense, yes. However, earnings growth rate can account for higher P/Es for some companies as if a company is expected to grow at 40% for a few years it may have a higher P/E than a company growing earnings at 5% for example.", "Let's take a step back. My fictional company 'A' is a solid, old, established company. It's in consumer staples, so people buy the products in good times and bad. It has a dividend of $1/yr. Only knowing this, you have to decide how much you would be willing to pay for one share. You might decide that $20 is fair. Why? Because that's a 5% return on your money, 1/20 = 5%, and given the current rates, you're happy for a 5% dividend. But this company doesn't give out all its earnings as a dividend. It really earns $1.50, so the P/E you are willing to pay is 20/1.5 or 13.3. Many companies offer no dividend, but of course they still might have earnings, and the P/E is one metric that used to judge whether one wishes to buy a stock. A high P/E implies the buyers think the stock will have future growth, and they are wiling to pay more today to hold it. A low P/E might be a sign the company is solid, but not growing, if such a thing is possible.", "While on the surface it might not make sense to pay more than one dollar to get just one dollar back, the key thing is that a good company's earnings are recurring each year. So, you wouldn't just be paying for the $1 dollar of earnings per share this year, but for the entire future stream of earnings per share, every year, in perpetuity -- and the earnings may grow over time too (if it remains a good company.) Your stock is a claim on a portion of the company's future. The brighter and/or more certain that future, the more investors are willing to pay for each recurring dollar of earnings. And the P/E ratio tells you, in effect, how many years it might take for your investment to earn back what you paid – assuming earnings remain the same. But you would hope the earnings would grow, too. When a company's earnings are widely expected to grow, the P/E for the stock is often higher than average. Bear in mind you don't actually receive the company's earnings, since management often decides to reinvest all or a portion of it to grow the company. Yet, many companies do pay a portion of earnings out as dividends. Dividends are money in your pocket each year."]

What one bit of financial advice do you wish you could've given yourself five years ago?

['2 things:', 'I wish I had learned my lesson from the dot com bubble before I took a piece of the housing bubble.', 'Maybe not exactly 5 years ago, but the big thing I wish I understood starting out my career was retirement accounts and how they worked.', "(more like 10 years ago, but that's beside the point) Save, save, save! Both in the notion of squeezing as much value as you can out of every purchase and the notion of putting money away in a savings account.", 'I wish I would have:', 'I wish I had started contributing to the pension fund offered by my employer sooner than it became compulsory. That is, I started working when I was 23 but did not contribute to the pension fund until I was 30 (the age at which it is compulsory to do so). I lost a lot of productive years in mid to late 90s, when the stocks were doing well. :-(', "I was offered a student credit card and refused it. If I'd taken it and used it sparingly, paying off the balance on time in full every month, I'd have built up a better credit rating in the time period.", "Compound interest. Next time you buy a 100$ toy realize that if you save it - in x years that 100$ you saved and invested could potentially be more than 100$ where as most likely whatever you're buying will be worth much less.", "Now, if I wasn't concerned with the integrity of my already tainted soul I would have given myself the following advice five years ago:", 'Advice to myself: the benefits of being self-employed totally outweigh the risks!', 'Get an advanced degree. This should increase your earning power. Also learn how to use a computer, this should also tend to increase your earning power.', 'I wish I would have known macro-economics taught by the Austrian School types at The Mises Institute. Their teachings would have compelled me to do the following:', 'Bank every dollar possible to have more cash available for investing during the 2008/2009 crisis.', "Planned my grocery shopping better. You can't just wake up on Saturday hungry go to the grocer and buy what looks good. Take the time to clip some coupons and more importantly make a shopping list.", 'Do your homework on all types bonds and other lower-risk instruments, including bond funds and ETFs. I left too much money sitting around as cash over the last 5 years.', 'When I was contracting I wish I had joined a tax efficient umbrella organisation rather than just work as a sole trader. I also wish I had put money aside to pay my taxes rather than just spend it all. :(']

Flexplan - a company is taking over another, do I pay the balance?

['This is only one of a series of questions your friend needs to understand. They will also need to know what happens to: vacation balances; the vacation earning schedule; retirement fund matching; the pension program; all the costs and rules regarding health, dental and vision;life insurance amounts. Some of these can be changed immediately. Some will not be changed this year because of IRS regulations. Everything can be changed by the next year. But there is no way to know if they will change a little a possible or as much a possible. It will depend on if they are buying the company, or if the company is going out of business and the new company is buying the remnants. They may also be essentially terminating the employees at the old place, and giving them the first opportunity for interviews. If they are essentially quitting they will not have to continue paying into the plan. The bad news is that their last day of work is also probably their last day to incur expenses that they can pay for with the flexible plan. If They are being purchased or absorbed the company will likely make no changes to the current plan, and fold them into the plan next year. I have been involved with company purchases and company splits, and this is how it was handled.']

Can a company stop paying dividends?

['Yes. Companies increase, decrease, start paying and stop paying dividends when they think it appropriate. If a company has been going through some problems and makes a loss, or even a large decrease in profits, they can choose to stop paying dividends until things improve. Many companies did this during the Global Financial Crisis of 2007-08.', 'Dividends are supposed to be paid from company profits (in the current or previous financial years), there are nuances around what profits mean from country to country, but the link is the UK definition from the HMRC. Profits from previous financial years are commonly called retained earnings. There are a few items around this']

CD interest rate US vs abroad, is there a catch?

["Part 1 Quite a few [or rather most] countries allow USD account. So there is no conversion. Just to illustrare; In India its allowed to have a USD account. The funds can be transfered as USD and withdrawn as USD, the interest is in USD. There no conversion at any point in time. Typically the rates for CD on USD account was Central Bank regulated rate of 5%, recently this was deregulated, and some banks offer around 7% interest. Why is the rate high on USD in India? - There is a trade deficit which means India gets less USD and has to pay More USD to buy stuff [Oil and other essential items]. - The balance is typically borrowed say from IMF or other countries etc. - Allowing Banks to offer high interest rate is one way to attract more USD into the country in short term. [because somepoint in time they may take back the USD out of India] So why isn't everyone jumping and making USD investiments in India? - The Non-Residents who eventually plan to come back have invested in USD in India. - There is a risk of regulation changes, ie if the Central Bank / Country comes up pressure for Forex Reserves, they may make it difficut to take back the USD. IE they may impose charges / taxes or force conversion on such accounts. - The KYC norms make it difficult for Indian Bank to attract US citizens [except Non Resident Indians] - Certain countries would have explicit regulations to prevent Other Nationals from investing in such products as they may lead to volatility [ie all of them suddenly pull out the funds] - There would be no insurance to foreign nationals. Part 2 The FDIC insurance is not the reason for lower rates. Most countires have similar insurance for Bank deposits for account holdes. The reason for lower interst rate is all the Goverments [China etc] park the excess funds in US Treasuries because; 1. It is safe 2. It is required for any international purchase 3. It is very liquid. Now if the US Fed started giving higher interest rates to tresaury bonds say 5%, it essentially paying more to other countries ... so its keeping the interest rates low even at 1% there are enough people [institutions / governemnts] who would keep the money with US Treasury. So the US Treasury has to make some revenue from the funds kept at it ... it lends at lower interest rates to Bank ... who in turn lend it to borrowers [both corporate and retail]. Now if they can borrow cheaply from Fed, why would they pay more to Individual Retail on CD?, they will pay less; because the lending rates are low as well. Part 3 Check out the regulations", '"If you invest in a foreign bank you are subject to their financial rules and regulations. If you put your money with their CD it will be converted to UAH (grivna) and you will be paid back in UAH, which introduces the exchange rate risk. FDIC is not the only reason why a CD in a US bank pays a lower interest, but it could be seen as a contributing factor. It all comes down to risk and what the bank is willing to pay for your money, when a bank issues a CD they are entering the debt market and competing against other banks, governments, or anyone looking for money. If the yield from lending to one bank is the same as the yield of another, the logical choice would be whichever loan is less risky. So in order for the riskier bank to receive loans they must entice investors by offering a greater rate of return. In addition, if a bank isn\'t looking for loans they might be less inclined to pay for them. - See ""What is the “Bernanke Twist” and “Operation Twist”? What exactly does it do?"" If your looking to invest in the CD\'s of foreign banks I would suggest doing research on their regulations. Especially if and how your money is protected in the event the bank goes bust."', "I think your approach of looking exclusively at USD deposits is a prudent one. Here are my responses to your questions. 1) It is highly unlikely that a USD deposit abroad be converted to local currency upon withdrawal. The reason for offering a deposit in a particular currency in the first place is that the bank wants to attract funds in this currency. 2) Interest rate is a function of various risks mostly supply and demand, central bank policy, perceived risk etc. In recent years low-interest rate policy as led by U.S., European and Japanese central banks has led particularly low yields in certain countries disregarding their level of risk, which can vary substantially (thus e.g. Eastern Europe has very low yields at the moment in spite of its perceived higher risk). Some countries offer depository insurance. 3) I would focus on banks which are among the largest in the country and boast good corporate governance i.e. their ownership is clean and transparent and they are true to their business purpose. Thus, ownership is key, then come financials. Country depository insurance, low external threat (low war risk) is also important. Most banks require a personal visit in order to open the account, thus I wouldn't split much further than 2-3 banks, assuming these are good quality."]

Electric car lease or buy?

['There are some who argue that you should lease an electric car. These factors are in addition to all the normal pros and cons of leasing vs. buying. The technology is still new and is advancing rapidly. In 2-3 years, the newer model may have significantly improved features, range, and efficiency, as well as lower prices. If you are the type of person to upgrade regularly to the latest and greatest, leasing can make it a smoother transition. It is hard to predict the depreciation of the vehicles. This is both because of the above factors, but also because these kinds of cars are newer and so the statistical models used to predict their future values are less refined. The models for predicting gas car prices have been honed for decades. EV Manufacturers have in the past made some mistakes in their residual value estimations. When you lease a car, you get essentially an option to buy the car at the future predicted residual value. If, at the end of the lease, the market value of the car is higher than the residual value, you can purchase the car at the predetermined price, making yourself some extra money. If the value is lower than the residual, you can return the car or renegotiate. I know a relatively large number of electric vehicle owners. Most or all of the ones who got the vehicle new leased it. The rest bought used vehicles coming off lease, which can also be a good deal.', '"Electric does make a difference when considering whether to lease or buy. The make/model is something to consider. The state you live in also makes a difference. If you are purchasing a small electric compliance car (like the Fiat 500e), leasing is almost always a better deal. These cars are often only available in certain states (California and Oregon), and the lease deals available are very enticing. For example, the Fiat 500e is often available at well under $100/mo in a three-year lease with $0 down, while purchasing it would cost far more ($30k, minus credits/rebates = $20k), even when considering the residual value. If you want to own a Tesla Model S, I recommend purchasing a used car -- the market is somewhat flooded with used Teslas because some owners like to upgrade to the latest and greatest features and take a pretty big loss on their ""old"" Tesla. You can save a lot of money on a pre-owned Model S with relatively low miles, and the battery packs have been holding up well. If you have your heart set on a new Model S, I would treat it like any other vehicle and do the comparison of lease vs buy. One thing to keep in mind that buying a Model S before the end of 2016 will grandfather you into the free supercharging for life, which makes the car more valuable in the future. Right now (2016/2017) there is a $7500 federal tax credit when buying an electric vehicle. If you lease, the leasing company gets the credit, not you. The cost of the lease should indirectly reflect this credit, however. Some states have additional incentives. California has a $2500 rebate, for example, that you can receive even if you lease the vehicle. To summarize: a small compliance car often has very good reasons to lease. An expensive luxury car like the Tesla can be looked at like any other lease vs buy decision, and buying a used Model S may save the most money."', "I would like to add that from my own research, a pro to leasing over buying a new vehicle would be that with the lease the entire 7,500 federal incentive is applied directly to the lease, or so they say. If you buy a new car you get a 7,500 federal tax incentive also but if you dont have 7,500 bucks in taxes this wont be as much value. It doesn't sense to me to buy used since you dont get the tax incentive and also if you're in california the 2,500 rebate only applies to buying new or leasing 30 month or longer.", "I have coworker who reported that he leased a Nissan Leaf from 2013-2016 and was offered $4000 off the contracted purchase price at the end of the lease due to a glut of other lessees turning in for a lease on the newest model with greater range. It's not clear that this experience will be repeated by others three years from now, but there is enough uncertainty in the future electric car market that it's quite possible to have faster depreciation on a new vehicle than you might otherwise expect based on experience with conventional internal combustion powered vehicles. Leasing will remove that uncertainty. Purchasing a lease-return can also offer great value. I looked at the price for a lease return + a new battery with the extended range, and it was still significantly cheaper than buying a completely new vehicle.", '"The good news about maintenance is that there\'s much less scheduled maintenance because the cars are mechanically much simpler. See the official service schedule. Most of it is just ""rotate tires / replace cabin air filter"". The brake and suspension systems are very similar to those of a normal car and require comparable maintenance. The bad news is the battery will decay over time and is a major component of the cost of the car. From that link: In the UK, the LEAF’s standard battery capacity loss warranty is for 60,000 miles or five years So you should factor your warrantied battery lifetime into the depreciation calculation. I don\'t think there are going to be many ten- or twenty- year old electric cars from the current crop in 2030 or 2040 as they\'re still improving dramatically year-on-year. (Slightly too long for a comment, slightly too short for a proper answer)"', "I might be missing something, but I always understood that leasing is about managing cash-flow in a business. You have a fixed monthly out-going as opposed to an up-front payment. My accountant (here in Germany) recommended: pay cash, take a loan (often the manufactures offer good rates) or lease - in that order. The leasing company has to raise the cash from somewhere and they don't want to make a loss on the deal. They will probably know better than I how to manage that and will therefore be calculating in the projected resale value at the end of the leasing period. I can't see how an electric car would make any difference here. These people are probably better informed about the resale value of any type of car than I am. My feeling is to buy using a loan from the manufacturer. The rates are often good and I have also got good deals on insurance as a part of that package. Here in Germany the sales tax (VAT) can be immediately claimed back in full when the loan deal is signed."]

What are some valuable sources for investment experience, when there is very little to no money to start with?

["Fake stock market trading may teach you about trading, which isn't necessarily the same thing as investing. I think you need to understand how things work and how to read financial news and statistics before you start trading. Otherwise, you're just going to get frustrated when you mysteriously win and lose funny money. I'd suggest a few things: Also, don't get into individual stocks until you have at least $5k to invest -- focus on saving and use ETFs or mutual funds. You should always invest in around a half dozen diversified stocks at a time, and doing that with less than $1,000 a stock will make it impossible to trade and make money -- If a $100 stock position goes up 20%, you haven't cleared enough to pay your brokerage fees.", '"One way to start with stocks is by playing the fake stock market. Investigate what trading fees would be with a broker, then ""invest"" a certain amount of money - note it on paper or in a spreadsheet. Follow your stocks, make decisions on selling and buying, and see where you would be after a year or so. That way you can get an idea, even if not exactly precise, on what your returns would be if you really invested the money."']

What actions can I take against a bank for lack of customer service?

['Figure out who regulates the bank. Complain to your state banking/consumer affairs department. Complain to your state Attorney General. The Feds regulate most banks too, there are several different agencies, and I believe the way they regulate banks has changed recently. Try contacting the US Comptroller of the Currency.', "I don't think the verbal confirmation from the branch manager is worth anything, unless you got it in writing it basically never happened. That said, what did you sign exactly? An application? I'd think they would be well within their rights to deny that, no matter what the branch manager said. If you actually signed a binding contract between you and the bank, things would be different but the fact that 'approval' was mentioned suggests that all you and the bank signed was an application and the bank manager made some unreasonable promises he or she doesn't want to be reminded of now. If the complaints department can't get off their collective backsides, a firm but polite letter to the CEO's office might help, or it might end up in the round filing cabinet. But it's worth a try. Other than that, if you are unhappy enough to go through the pain, you can try to remortgage with another bank and end the business relationship with your current bank.", "You can complain to the Financial Ombudsman Service in Australia. I've never used them in particular but generally organizations will respond much faster once you get the ombudsman involved. However, since you say they've now kept their promises, the ombudsman is unlikely to do much more than listen sympathetically."]

What is the minimum age for early retirement

["You can withdraw from CPP as early as 60. However, by doing so, you will permanently reduce the payments. The reduction is calculated based on average life expectancies. If you live for an average amount of time, that means you'll receive approximately the same total amount (after inflation adjustments) whether you start pulling from CPP at 60, 65, or even delay your pension later. People may have pensions through systems other than CPP. This is often true for big business or government work. They may work differently. People who retire at 55 with a pension are not getting their pension through CPP. A person retiring at 55 would need to wait at least five years to draw from the CPP, and ten years before he or she was eligible for a full pension through CPP. Canada also offers Old Age Security (OAS). This is only available once you are 65 years old or older, though this is changing. Starting in 2023, this will gradually change to 67 years or older. See this page for more details. As always, it's worth pointing out that the CPP and OAS will almost certainly not cover your full retirement expenses and you will need supplementary funds."]

How to use a companion fare if the total fare cost is more than the companion fare limit

['"You must buy both tickets in 1 transaction and the purchased ticket cannot be purchased with miles. You\'ll pay full price (technically a ""paid published coach airfare"") for the first ticket and enter in your discount code for the companion fare which will ring up as $99 + fees ($118 in your example). If the regular price is $500, you\'ll book 2 tickets for $618 (one fare at $500 and companion fare at $118). Companion Fare Discount Code Q & A What is the Companion Fare Discount Code that comes with my credit card? The Companion Fare Discount Code is offered to holders of the Alaska Airlines Visa Signature® Card, The Platinum Plus® MasterCard® and the Visa® Business Card. This Discount Code entitles the cardholder to purchase one round-trip coach companion fare on Alaska Airlines from $121 (USD) ($99 base fare plus applicable taxes and fees from $22 depending on your Alaska Airlines flight itinerary) when traveling with another passenger on a paid published coach airfare on the same itinerary, booked at the same time. Mileage cannot be used as a form of payment, however mileage credit accrual is allowed for both travelers. Travelers are responsible for all applicable taxes, fees, surcharges and applicable checked baggage fees. The Companion Fare Discount Code is not valid with award travel, and cannot be combined with other discounts. Source: Alaska Air Companion Fair Q&A"']

Do gift cards expire? Does a gift certificate's value depreciate? How long can I keep them for?

['It depends on: In Canada, Ontario, Manitoba, Alberta and Nova Scotia have each enacted legislation to stop gift cards/certificates from expiring. Cards issued before the effective date are still subject to the old rules. The legislation came into effect: There are several common themes: There are still some unusual exemptions such as mall gift cards in Ontario, Manitoba: Ontario is the first jurisdiction in Canada to regulate gift cards. [...] Mall cards (e.g. Eaton Centre gift card) will be covered by the expiry date ban and the new disclosure rules. However, these cards can temporarily maintain their current fee structure while the provincial government examines options on how to best regulate these types of cards. This will allow more time to develop an approach that strikes the right balance for consumers and businesses. For specific details see the appropriate link.']

How can one get their FICO/credit scores for free? (really free)

["As of 2014, this answer is deprecated. Read answer here for recent developments up to January 2015. You can get a free credit report yearly, but you don't get your credit score, just the content of your report. This is useful to make sure your credit history is correct, etc. To get that, visit annualcreditreport.com. Another site which will give you your score for free, really free with no strings attached, is creditkarma.com, which gives you your TransUnion credit score and full TransUnion credit report. The site is run by TransUnion and supported via advertising. At this point Equifax and Experian offer similar services via subscription, but not for free. Update 8/14/2015: CreditKarma now offers the Equifax information as part of their service.", 'I get my credit scores from all three bureaus for free - no gimmick. I use a combination of banks that offer this service to get my scores. I wrote about this sometime back in my blog. For credit report, the only place to go is AnnualCreditReport.com. I space it out so that I get one every 4 months since there is a once a year restriction per bureau.', "I visited annualcreditreport.com to get my annual credit report. It is only the report, not the score or FICO score. This is the only outlet I know of that allows you to get your report for free, without a bunch of strings attached or crap to sign up for and cancel later. It was very easy. I was wary of putting in my private information, but how else can they possibly pull you up? Read the instructions carefully. You go to each bureau to fetch your report, and they dutifully give you a free report, but they push hard to try and sell you a score or a report service. It is easy to avoid these if you read carefully. Once you get a report, you have print it out or you can't see it again for another year. Each bureau has a different site, with different rules, and different identity checks to get in. Again, read the instructions and it isn't hard. Instead of printing, I just saved the page as HTML. You get one html file and a folder with all the images and other stuff. This suits me but you might like to print. After you get each report, you have to click a link to back to the annualcreditreport.com site. From there you go to the next bureau. Regarding a score. Everybody does it differently. Free Issac does FICO, but anybody who pulls your credit can generate a score however they like, so getting a score isn't anywhere near as important as making sure your report is accurate. You can use credit.com to simulate a score from one of the bureaus (I can't easily see which one at the moment). It is as easy as annualcreditreport.com and I have no issue getting a simulated score and report card.", "I've seen credit cards that provide you your credit score for free, updated once a month and even charted over the last year. Unfortunately the bank I used to have this card with was bought and the purchasing bank discontinued the feature. Perhaps someone out there knows of some cards that still offer a feature like this?", '"It appears that you already know this, but FICO credit scores (as controlled by Fair Isaac Corporation) are the real official credit scores, and FICO takes a cut on their production no matter which of the 3 major credit bureaus calculates the official score (all using slightly different methods). Be careful when obtaining a score for making a big decision that it is a FICO score, because relatively few lenders will lend based on a non-FICO score. That said, some non-FICO scores are easy to obtain and can be roughly translated to an approximation of your score. Barclays US/ Juniper Bank credit cards offer a free Transunion ""TransRisk""(TM) score. The TransRisk score is a 900 point scale, while the FICO score is an 850 point scale. This is a simple ratio and you can calculate your approximate FICO score by the formula:"', "Check with your bank. As of January, 2015, the following banks and credit unions are offering free credit-scores: Announced, in the pipeline: Source: Banks to offer FICO credit scores for free Personal Experience: I've been receiving free FICO score from my credit union for more than 6 months now. Advice: Most people have multiple bank/credit-union accounts. The FICO score will be the same whoever offers it. If none of your financial institutions offer you a free credit-score then you may opt for free services like creditkarma.com or other paid services. None of them are the widely used FICO scores, but they can be a good gauge of your credit standing. Please note that a credit-score is number summarizing your credit-report and should not be confused. In the news:", 'Credit Sesame monitors your credit score for free. My understanding is that they make their money off of credit card referrals.']

Bi-weekly payment option

["Your question is unclear about whether you are moving from bi-weekly payments or to bi-weekly payments. Let's calculate each case. Bi-weekly pay means you will be paid every two weeks. The amount for each payment will be your annual salary divided by 26, possibly with a small decrease (around 0.3%) to account for the fact that years are slightly longer than 52 weeks (i.e. there are slightly more than 26 two-week periods in a year), and possibly an even smaller adjustment to take account of the fact that some years are a day longer than that. You will be paid literally every 14 days (with some adjustments if a payday falls on a holiday) If you are going to be paid twice a month, then each payment will be your annual salary divided by 24. Typically you are paid on the same days of each month - for example the 1st and the fifteenth, or the last business day before those.", "Biweekly pay for salaried employees is typically calculated as Annual-salary / 26. Twice a month pay for salaried employees is typically calculated as Annual-salary / 24. If you were getting paid twice a month and now are getting paid every other week, your paycheck will be roughly ( Twice-a-month-paycheck-amount * 24 / 26 ). If you were paid $1000 twice a month, you'll be paid $923 every other week. $1000 * 24 = $24K and $923 * 26 = $24K. You will get paid every other week regardless of month boundaries on a biweekly pay cycle.", "One point that I don't see covered in the other answers yet: How does this affect the months that have 5 weeks. Do we actually lose two weeks a year? I get paid every two weeks, and pay day is always a Friday. Some months, I get paid 3 times - which is always great. If you live within your means, it's like an extra paycheck. All other months, I get paid two times. How many months a year do I get paid 3 times? 2. It will always be two, because there are 12 months. If you get paid twice a month, that's 24 pay checks, which is 2 shy of 26 pay checks - what we would expect if we were paid every two weeks. That means those 2 extra pay checks need to fall somewhere, and they will be on the months where your pay day is hit 5 times. For example, in 2014, there are 4 months with 5 Fridays: Jan May Aug Oct I got paid the second Friday of January, so I only got 2 checks in January. I will be paid on the first Friday of May, which means I will get 3 checks in May. My other triple-check month this year is October, so of course I am only going to be paid twice in August."]

Should I be worried that I won't be given a receipt if I pay with cash?

["If this is because he wants to avoid paying taxes, will I get in trouble if I agree to have him work on my vehicle? You should check your state and local sales tax laws to be certain, but in my state you have no liability if he does not pay his taxes. That's his problem, not yours. The biggest risk for you is if something goes wrong, you have no proof that the work was ever done, so it's possible he could deny that any transaction ever took place and refuse to correct it or refund your money. So at worst you're out what you paid for the service, plus what it would cost you to fix it if you needed to and chose to do so. If you don't want to take that risk, then insist on a receipt or take you business elsewhere, but there's no criminal liability for you if he chooses not to report the income. EDIT Be aware, though that state tax is levied at the state and local level, so the laws of your individual state or city may be different.", '"There are number of reasons why someone doesn\'t want to give you a receipt for cash payment. Anything ranging from not wanting to pay taxes, to being able to deny you gave them money for service in the event you\'re not happy with the service and ask for money back. You won\'t get in trouble for giving him cash, however you should be worried because any ""reputable"" person providing any type of service/product will provide a receipt regardless of payment type."', "In some states, it is your responsibility to pay the sales tax on a transaction, even if the party your purchase from doesn't collect it. This is common with online purchases across state lines; for example, here in Massachusetts, if I buy something from New Hampshire (where there is no sales tax), I am required to pay MA sales tax on the purchase when I file my income taxes. Buying a service that did not include taxes just shifts the burden of paperwork from the other party to me. Even if you would end up saving money by paying in cash, as other here have pointed out, you are sacrificing a degree of protection if something goes wrong with the transaction. He could take your money and walk away without doing the work, or do a sloppy job, or even damage your vehicle. Without a receipt, it is your word against his that the transaction ever even took place. Should you be worried that he is offering a discount for an under the table transaction? Probably not, as long as you don't take him up on it."]

Canceling credit cards - insurance rate increase?

['"You don\'t need to have a bunch of credit cards lying around; just a couple is fine. Get a ""rewards"" card (without annual fee) that pays you back for use, and use it regularly to buy groceries, for example. Pay it off promptly each month, using the rewards, if you like, to reduce the amount you have to send in. Or you can use the rewards for other purchases; some merchants offer $25 worth of merchandise for $20 in rewards. It used to be the case that you could negotiate a discount for paying cash rather than use a credit card, but that is a lot harder to do now, in many cases because credit-card company contracts with merchants prohibit this practice. Also, merchants often prefer credit cards rather than cash because money-handling is an issue (pay for an armored car to come pick up the day\'s receipts, or risk getting mugged on the way to the bank, possible burglaries if you leave the money overnight in the store, daily balancing of cash-register trays, etc.) So, not being in debt and being rich enough to not need to be in debt are laudable goals, and you have my best wishes that you will reach them soon, but getting rid of all your credit cards as a part of not being in debt may be more trouble than it is worth. Keep a couple, pay them off promptly, and if you are concerned about being in debt, you can time your charges so that you are in debt at most 2 or 3 days each month."', '"The comments section to Dilip\'s reply is overflowing. First - the OP (Graphth) is correct in that credit scoring has become a game. A series of data points that predicts default probability, but of course, offers little chance to explain why you applied for 3 loans (all refinancing to save money on home or rentals) got new credit cards (to get better rewards) and have your average time with accounts drop like a rock (well, I canceled the old cards). The data doesn\'t dig that deep. To discuss the ""Spend More With Plastic?"" phenomenon - I have no skin in the game, I don\'t sell credit card services. So if the answer is yes, you spend more with cards, I\'ll accept that. Here\'s my issue - The studies are all contrived. Give college students $10 cash and $10 gift cards and send them into the cafeteria. Cute, but it produces no meaningful data. I can tell you that when I give my 13yr old $20 cash, it gets spent very wisely. A $20 Starbucks card, and she\'s treating friends and family to lattes. No study needed, the result is immediate and obvious. Any study worth looking at would first separate the population into two groups, those who pay in full each month and those who carry a balance. Then these two groups would need to be subdivided to study their behavior if they went all cash. Not a simply survey, and not cheap to get a study of the number of people you need for meaningful data. I\'ve read quotes where The David claimed that card users spend 10% more than cash users. While I accept that Graphth\'s concern is valid, that he may spend more with cards than cash, there is no study (that I can find) which correlates to a percentage result as all studies appear to be contrived with small amounts to spend. As far as playing the game goes - I can charge gas, my cable bill, and a few other things whose dollar amounts can\'t change regardless. (Unless you\'re convinced I\'ll gas up and go joy-riding) Last - I\'d love to see any link in the comments to a meaningful study. Quotes where conclusions are stated but no data or methodology don\'t add much to the discussion. Edit - Do You Spend More with Cash or Credit? is an article by a fellow Personal Finance Blogger. His conclusion is subjective of course, but along the same path that I\'m on with this analysis."', 'Your credit score can be part of the algorithm for setting your rates for auto insurance. It is one of many factors including sex, age, zip code, driving record, type of car... There are some states that are concerned about using credit scores, some sates have passed legislation regarding this issue', "You can't ask insurers to use a particular score -- they have a state-approved underwriting model that they must follow consistently. Insurance companies make money by not paying claims, and poor credit score (including limit access to credit) increases the probability that you will file a small claim. Why? If you get into a minor accident (say $750 of damage) and have a $500 deductible, you are much less likely to file a claim to get $250 if you have access to a cash or credit lines to make the repairs yourself. If you feel that you are going to be penalized for closing credit card accounts, the solution is simple -- don't close them. Other than an event where you need to sever a relationship with a co-owner of an account (ie, you break up with your significant other, dissolve a business, etc) or avoid paying an annual fee, there is no advantage to you closing a revolving credit account, ever. If you cannot control your spending, throw the card in the shredder. Eventually, the credit card company will close your account for inactivity, which affects your credit to a lesser degree. (The big exception is if you carry sufficient balances on other cards, your credit utilization ratio goes up materially.)"]

What's the benefit of a credit card with an annual fee, vs. a no-fee card?

["How would you respond to these cases: Limited card options - If someone has a bad credit record the cards available may only be those with an annual fee. Not everyone will have your credit record and thus access to the cards you have. Some annual fees may be waived in some cases - Thus, someone may have a card with a fee that could be waived if enough transactions are done on the card. Thus, if someone gives enough business to the credit card company, they will waive the fee. On the point of the rewards, if the card is from a specific retailer, there could be a 10% discount for using that card and if the person purchases more than a couple thousand dollars' worth from that store this is a savings of $200 from the retail prices compared to what would happen in other cases that more than offsets the annual fee. If someone likes to be a handyman and visits Home Depot often there may be programs to give rewards in this case. Credit cards can be useful for doing on-line purchases, flight reservations, rental cars and a few other purchases that to with cash or debit can be difficult if not close to impossible. Some airline cards have a fee, but presumably the perks provide a benefit that outweigh that fee over the year. I'm thinking of the Citibank cards tied to American Airlines, first year free, then an $85 fee.", "Just to make this a little less vauge, I will base everything on the Mercedes Benz American Express (MB AMEX) card, which is the closest to a $100 annual fee I found on American Express's website. The benefits of a card with an annual fee generally are worth the cost if (and only if) you spend enough money on the card, and avoid paying interest to offset the benefit. Using the MB AMEX card as a reference, it offers 5X points for Mercedes Benz purchases, 3X points at gas stations, 2X points at restaurants, and 1X points everywhere else. Even if we only make purchases at the 1X rate, it only takes charging $10,000 to the card in a year in order to make up the difference. Not too hard to do on a card someone uses as their main method of payment. Every dollar spent at the higher rates only makes that easier. There are a number of other benefits as well. After spending $5,000 on the card in a year, you receive a $500 gift card towards the purchase of a Mercedes Benz car. For anyone on the market for a Mercedes Benz, the card pays for itself multiple times with just this benefit."]

What is a checking account and how does it work?

["A checking account is one that permits the account holder to write demand drafts (checks), which can be given to other people as payment and processed by the banks to transfer those funds. (Think of a check as a non-electronic equivalent of a debit card transaction, if that makes more sense to you.) Outside of the ability to write checks, and the slightly lower interest rate usually offered to trade off against that convenience, there really is no significant difference between savings and checking accounts. The software needs to be designed to handle checking accounts if it's to be sold in the US, since many of us do still use checks for some transactions. Adding support for other currencies doesn't change that. If you don't need the ability to track which checks have or haven't been fully processed, I'd suggest that you either simply ignore the checking account feature, or use this category separation in whatever manner makes sense for the way you want to manage your money.", '"A savings account and a checking account (or a ""demand"" account, or a ""transactional"" account) have different regulations. For example, fractional reserve requirements are 10% against checking accounts, but 0% against savings accounts. The theory is that savings accounts are sticky, while checking accounts are hot money. So the Fed wants to stop banks from creating accounts that are regulated as savings accounts but have the features of checking accounts. In the past, this was done by forbidding banks to pay interest on checking accounts. They eliminated that rule back in the inflation years, and instead imposed the rule that to qualify as a savings accounts for regulatory purposes, banks must discourage you from using them as transactional accounts. For example, by limiting the number of withdrawals per month that can be made from a savings account. If the Fed gave up on trying to enforce a distinction, I suspect there would soon no longer be a distinction."', '"As others have noted, in the U.S. a checking account gives you the ability to write a check, while a savings account does not. I think you know what a check is even if you don\'t use them, right? Let me know if you need an explanation. Personally, I rarely write paper checks any more. I have an account for a small side business, and I haven\'t bothered to get new checks printed since I moved 6 years ago even though the checks still have my old address, because I\'ve only written I think 3 paper checks on that account in that time. From the bank\'s point of view, there are all sorts of government regulations that are different for the two types of accounts. But that is probably of little concern to you unless you own a bank. If the software you have bought allows you to do the things you need to do regardless of whether you call the account ""savings"" or ""checking"", then ... who cares? I doubt that the banking software police will come to your house and beat you into unconsciousness and arrest you because you labeled an account ""checking"" that you were supposed to label ""savings"". If one account type does what you need to do and the other doesn\'t, then use the one that works."']

What is the fastest way to retire, using passive income on real estate

["It is worth noting first that Real Estate is by no means passive income. The amount of effort and cost involved (maintenance, legal, advertising, insurance, finding the properties, ect.) can be staggering and require a good amount of specialized knowledge to do well. The amount you would have to pay a management company to do the work for you especially with only a few properties can wipe out much of the income while you keep the risk. However, keshlam's answer still applies pretty well in this case but with a lot more variability. One million dollars worth of property should get you there on average less if you do much of the work yourself. However, real estate because it is so local and done in ~100k chunks is a lot more variable than passive stocks and bonds, for instance, as you can get really lucky or really unlucky with location, the local economy, natural disasters, tenants... Taking out loans to get you to the million worth of property faster but can add a lot more risk to the process. Including the risk you wouldn't have any money on retirement. Investing in Real Estate can be a faster way to retirement than some, but it is more risky than many and definitely not passive.", "You can't calculate how many houses it will take. To do so you would have to know how much you can charge in rent compared to how much is costs to run that particular location. If the desirability of that location changes, so does the ability to rent the place, and so does the amount you can charge. It is possible to create a business in real estate that would allow you to generate retirement income. But you would be focusing all your income in your retirement years on one segment of the entire investment universe. The diversification would have to come from spreading the money through different types of real estate: condo, apartments, houses, commercial, warehouse, light industrial. You would even have to decide whether you want them all in one micro-market, or spread throughout a larger market, or an even wider area diversification. As your empire grew and you approached retirement age you would have to decide if you wanted to liquidate your investments to minimize risk. The long leases that provides stability of income would make it hard to sell quickly if the market in one area started to weaken.", "Rule of thumb: To retire with a yearly income of $X, you need to save $(20*X) -- in other words, the safe assumption is that you'll average 4% returns on your stabilized savings/investments. In the case of retiring with a $50k passive pretax income, that means you need savings of $1M by the time you retire. If you want the $50,000 to be real post-tax spendable dollars, and your savings aren't in something like a Roth 401k or Roth IRA, increase that proportionately to account for taxes. How you get there depends on what you start with, how much you put into it every year, how you invest it and how many years you have before your retirement date. Passive investment alone will not do it unless you start with a lot of money; passive ongoing investment may depending on how much you can make yourself save when. To find out whether any specific plan will do what you need, you have to work with real numbers."]

How To Record Income As An Affiliate ( UK )

["Every bill you write counts as income (if the bill doesn't get paid, you would count that as an expense). In cases where you don't write bills, I think the payment you receive would count as income, but you might check that on the HMRC website. So to record your income, you can basically record the payments that you receive. Anything you pay out for your business is an expense. You keep a receipt for every expense - if you don't have a receipt, you can't count it as an expense, so keeping all the receipts is very, very important. An exception are investments, for example buying a computer that should last multiple years; there you can count a percentage of the investment as expense every year. All income, minus all expenses, is your profit. You pay tax and National Insurance contributions according to your profit. You can do whatever you like with the profit. Notice that I didn't mention any salary. Self employed means you have no salary, you have profits and do with them whatever you like. On the other hand, you pay taxes on these profits almost exactly as if they were income. If you have this blog but are also employed, you'll add the profits to your normal income statement.", "Adsense don't pay you daily. They pay you every month (as they have to calculate the final value). I'd say you only have to declare it when it hits your bank account. £60 actually isn't that much. It only took me a couple of months of just making a few quid, to making enough to get a monthly payment, and I only tot up what goes into my bank account. I've opened up a second account with my bank to send and receive payments relating to my online adventures. Then any in/out goes into a spreadsheet that I do at the end of the month keeping track of everything. If Mr. Taxman want to investigate at the end of the tax year, it's all logged in that account. It gets a bit murkier if you start doing US Amazon affiliates. The simplest method is to get the cheque delivered, and then log the amount that goes into your bank (after $->£ conversion). I have a Payoneer account, and transfer most of the money into my account (after it hits $500), and keep a little bit in for things I buy that are in USD. Hope that helps."]

Quandl financial data : unexpected dividend

['"For MCD, the 47¢ is a regular dividend on preferred stock (see SEC filing here). Common stock holders are not eligible for this amount, so you need to exclude this amount. For KMB, there was a spin-off of Halyard Health. From their IR page on the spin-off: Kimberly-Clark will distribute one share of Halyard common stock for every eight shares of Kimberly-Clark common stock you own as of the close of business on the record date. The deal closed on 2014-11-03. At the time HYH was worth $37.97 per share, so with a 1:8 ratio this is worth about $4.75. Assuming you were able to sell your HYH shares at this price, the ""dividend"" in the data is something you want to keep. With all the different types of corporate actions, this data is extremely hard to keep clean. It looks like the Quandl source is lacking here, so you may need to consider looking at other vendors."']

How to help a financially self destructive person?

["I learned this from a business book on managing people, but I think it applies equally well here. You can't put in what God left out of people. I know several people with this mentality about money and you simply have to make your sculpture out of the clay you have. In this case, however, it seems that ship has sailed, considering it is your ex and you aren't on speaking terms. That would make it even harder, and it is debatable about whether it is your prerogative to even try. Just focus on the kids and make it clear to your wife that she needs to be providing the basics (food, shelter, heat, etc.) and don't escalate that unless it becomes a danger to the kids. In a non-judgmental way (towards your wife) I'd use it as an opportunity to teach your kids about financial responsibility and the dangers of overspending and get-rich quick schemes. It sounds like they have an example in their lives of the consequences of two very different ways of managing one's finances.", "You say you're not on speaking terms: so you do it via your lawyer. You're divorced: so IMO your obligations are: a) To your kids b) Purely financial spousal support (if any) If she's irresponsible financially then maybe she isn't the best able to care for your children. Your lawyer ought to be able to tell you what the alternatives are (it's very state-specific so no general advice from the Internet, but if your lawyer can't do that then IMO you need a different lawyer who has more experience with divorce/custody cases).", "I'm afraid your best recourse may be legal. I don't know that internet is a necessity, but the court would frown upon anyone paying $4K for rent but not being able to afford to heat the water or turn the lights on. $48K a year net should be enough for her to at least keep the kids with these things. I don't know that you can educate her. Her issue is very deep-seated and far beyond a good financial planning type session.", "You can't help people that don't want help, period. It just doesn't work, and you will waste your time and energy while making the other person mad. Both sides end up in the same place they started except now they are frustrated with each other. In a normal situation I would advise to stop enabling her by giving her money, but the court has already decided that part. There is no reason that she can't provide for her children on US$50k per year. In all honesty it sounds like she has a mental health problem and needs to see a professional. You, as the ex-husband, are probably not the right person to tell her that, though. If you really want to help her and are still on good terms with some friends or family members she trusts you could ask them to help her get help. They probably see the same mess that you and your kids do, but might need a little encouragement to act. The other option is if you sued for custody, based on living conditions, the possibility of losing her children and the child support might provide a much needed incentive to clean up her act. You probably won't win over a couple of incidents of the power being turned off and you will be putting your kids in the uncomfortable situation of telling on their mother though.", 'Back in the day, they had a highly effective solution for this type of crap, but it is frowned upon in modern society. The second-best solution would be to get your lawyer to put together a case that she is unfit to be around the children and that visitation rights should be revoked. Unfortunately, this will most likely not solve her problems, and she will probably become far worse as she feels more alone, alienated, miserable, and embarrassed.', '"Wow. Just ... wow. We all must start where we are, I guess. The past is the past. There almost certainly isn\'t a cheap way to fix this. You\'re already on the hook for $4k per month. Your money is enabling her behavior. You\'d rather not enable her behavior, but the money is part of the consequences of your divorce, so into her bank account it goes. Those who control how much alimony your ex-wife receives might reach the conclusion she needs more. That\'s not a hard conclusion for them to make. It\'s not their money. The living conditions are hurting your kids, and that\'s unfortunate, but that\'s also part of the consequences of your divorce. If it\'s deemed that your kids are better off not visiting her, then you might be relieved of paying child support (since you\'re supporting them at that point) but you might still be supporting her until some trigger is met, which might be never. (You know those details better than I do, of course.) If she\'s already lost her house, filed for bankruptcy, borrowed money from people that she hasn\'t paid back, and gets a check from you each month and still has utilities shut off, she\'ll continue to deteriorate financially until she hits rock bottom. Then, and only then, will she see the need to fix her behavior. Now, the (possibly) million dollar question for you is, ""Where is rock bottom?"" Do what you can to make that happen sooner rather than later, because you\'ll likely be subsidizing her all the way down, and part of the way back up. You\'ve lost most of the leverage you once had to change her behavior, but try every way you can. You might hit the jackpot."', '"I am no expert by any means in divorce situations, but it seems like you probably have more than enough evidence (if you can back up everything you outlined here) that the living conditions an her place are not suitable for kids. This ought to be enough for you to gain sole custody of the kids. Maybe you didn\'t want to keep their mother in the equation for their benefit, but right now it\'s not to their benefit for her to be in the equation. The honest truth is that you\'re not in a position to help her being divorced. You can\'t force her to do anything as things stand now. But if you take legal actions to gain sole custody you might be able to lay down some conditions under which she could regain partial custody of the kids. This might be the ""scare"" approach you\'re looking for if she cares about her children."']

Should I charge my children interest when they borrow money?

['"I think there\'s value in charging family members/friends interest if it will make them take the loan seriously. The problem is that if you\'re thinking about charging interest because the person seems to be borrowing from you too cavalierly, it may be too late to make them take it seriously. In the situation you describe, if you\'re concerned about the loans being paid back, I think you need to have a serious conversation with the kids and make it clear you expect them to pay the loans back on whatever schedule you agreed to. If, based on your knowledge of your kids, you think charging interest would help motivate them to do this, great. If not, charging interest is unlikely to accomplish anything that the conversation itself won\'t accomplish. If you haven\'t previously outlined a specific schedule or set of expectations for how you want to be paid back, just doing that (in writing) may be enough to make them realize it\'s not a joke. The conventional wisdom is that you shouldn\'t lend money to anyone unless you\'re either a) okay with never being paid back; or b) willing to pursue legal remedies to ensure you\'re paid back. Most people aren\'t willing to sue their own family members over small loans, which means in most cases it\'s not a good idea to loan money to family unless you\'re ""okay with"" never being repaid (whatever level of ""okay with"" makes sense for you). I should note that I don\'t have kids; my advice here is just how I would handle it if I were considering loaning money to my brother or a close friend or the like. This means I don\'t really know anything about ""teaching the kids about the real world"", but I have to say my hunch is that if your kids are 25+ and married, it\'s too late to radically change their views on how ""the real world"" works; unless they had a very sheltered early adulthood, they\'ve been living in the real world for too long and will have their own ideas of how it works."', '"Tell them you will not loan them any more money until their existing debts are paid off. This is closer to how the real world works and it won\'t come across as vengeful or like your changing your initial ""contract"". If they protest, lovingly tell them that your money is not their money, and that an interest free loan from their father is a privilege, not a right. As far as charging interest on your loans, go for it! Charge them 5% or something small. Just don\'t do it on the existing loans or that will come across as changing your initial ""contract"" again, and perhaps once they\'ve proven themselves to be reliable borrowers they can once again earn the privilege to have an interest free loan. The book ""The Millionaire Next Door"" has really good thoughts on this in its section on Economic Outpatient Care."', "Parents are eminently capable of gifting to their children. If it's a gift call it a gift. If it's not a gift, it's either a loan or a landmine for some future interpersonal familial interaction (parent-child or sibling-sibling). I an concerned by some phrasing in the OP that it is partially down this path here. If it's a loan, it should have the full ceremony of a loan: written terms and a payment plan (which could fairly be a 0% interest, single balloon payment in 10 years or conditional on sale of a house or such; it's still not a gift).", 'Going from personal experience, my parents let my brother and me borrow money from them all the time. However there was always some noteworthy things to take into account. As an example, I borrowed a large sum of money on my student loan (we will just say it was $50,000). I had saved nearly $30,000 on my own and my parents lent me $10,000. I paid the remaining off over the course of about a year and a half. After this loan was paid off - I started paying my parents back. They dictated that I should not worry about paying them until my other interest loans were paid off. Once they were, my priority was to pay back my parents. Its supposed to help your children get ahead a little bit rather then sucking out interest from them. As long as the money was not needed elsewhere and is spent on something important I would not worry about it. Just make sure they are aware they are expected to pay it back in a reasonable amount of time or with specific requirements (such as after other loans are paid off).', "Would you expect your parents to charge you interest if you borrowed from them? Yes, if they said so when the money was borrowed. No, if there were no terms communicated when the money was borrowed. Expectations need to be clearly laid out up-front. What is your advice? I think you are asking the wrong question of whether or not you should charge interest. The real issue is that you are concerned about the 'borrowing', which are really turning out to be 'gifts'. The money amounts are not the issue as much as the lack of responsibility. Going back to your children and asking for interest will not fix this issue. This is my advice: This is a difficult process, and may not go over well with your children. Remember that this is not hurting them. You are actually hurting them more by allowing them to put off developing good habits, independence, and maturity. It is hard to see someone make choices that hurt themselves and others, but you cannot prevent them from making that choice. If they never feel the results of that choice, they will lack the motivation to change.", '"This is not really the focus of your question, but it\'s worth noting that if you live in the United States (which your profile says you do), there are tax implications for you (but not for your children), depending on whether or not you charge your children (enough) interest. If you charge less interest than the appropriate Applicable Federal Rate (for May 2016, at least 0.67%), you must pay taxes on the interest payments you would have received from the debtor if you had charged the AFR, provided that the loan is for $10,001 or more (p. 7). This is referred to as ""imputed"" income."', '"This is largely a cultural issue. I would be appalled at the very idea that my parents would charge me interest for lending me money. Just as they would be appalled if I were to do so if lending them money. I find the idea of attempting to make money off of your children fundamentally wrong. I realize that you only want to do this to teach them, that you have their best interests in mind and not your own profit. Nevertheless, what will actually happen were you to charge them interest is that you would accrue a monetary gain at the expense of your children. Is that really something you would be comfortable with? Now, as I stated at the beginning, this is clearly a cultural issue. Based on the other answers here, many cultures, probably including your own, find nothing wrong with this. I\'ve even heard of people charging their adult children rent when they come home for the holidays, something that is completely baffling to me. The point I am trying to make is that asking other people\'s opinions on whether you should do this is not very useful unless those people share your own cultural background. My family and culture are such that the idea of charging interest to one\'s family members seems downright immoral to me. Given that you are asking here, it seems like you might be on the fence about it yourself. However, I freely admit that my answer is colored by my own cultural prejudices and may very well not be applicable to you. Still, ask yourself, is a relatively small amount of money in the grand scheme of things—or, for that matter, an entire fortune—worth jeopardizing your relationship with your children? Do you really believe that having their parents retroactively charge them interest for a loan will somehow teach them something about the ""real world"" that your already adult children don\'t know? One of the main reasons they came to you and didn\'t go to a bank is precisely that they expected the loan to be interest free. So, sure, tell them that you won\'t lend any more until they repay what they owe. Even better, sit them down and have an honest, adult conversation, explaining that the absence of the money they owe is making itself felt in your household and work out a way they can repay you. What, in my opinion, you most certainly shouldn\'t do is treat your relationship with your children as a regular business transaction. It isn\'t and I am sure you don\'t want it to be."', 'If they have borrowed money without paying it back, what makes you think you could get interest paid? The problem that you face first is to make clear to them that a loan is a loan. As long as they can get free money off you, they will keep borrowing.', "Because this is Money.SE and you're connecting it to offspring, I'd think about a discussion with them to get their agreements. From my perspective, anything (my wife and) I have will go to offspring in the end. As such, everything borrowed and not repaid simply reduces the estate by that much. Among multiple offspring, such reductions should be against the borrower rather than spreading it out. That should be accounted for in whatever will is created. This would be the discussion point. It might also be discussed how or even if any interest should accrue for unpaid amounts. If, for example, a 1% APR is agreed upon for unpaid loans, then the final principle+interest amount is taken off of the borrower's inheritance. Existing outstanding loans might (or might not!) be useful examples for sample calculations if desired or needed. (If nothing else, they might serve as reminders that loans were not forgotten.) By having such a discussion, you can show that you are trying to plan for a fair distribution of your estate, perhaps thereby sidestepping any concern about charging interest to offspring for repaid loans. At the same time, you're handing over some financial responsibility, giving them a power of personal choice, which seems to be a part of what you're concerned about. Once such a discussion is started, it's possible that any question of interest will resolve itself naturally. The discussion almost necessarily must include all offspring at once. One will find it harder to negotiate from a standpoint of pure self-interest without objection from another. Think beforehand about what will be said and about what responses might come. Think things through as much as you can.", '"As per the age of your son you mentions i would suggest Yes, charge them an interest amount but lesser than the market rate. And give them a valid reason behind taking interest on given amount. The reason you might grab from below real incident happen with me at the time of Diwali last year. I am 26, and i am currently doing job and my salary is not so much that i can accomplish all my dreams of buying expensive Watch and many things. So i borrowed some strong amount from my mom. She gave me the amount but she asked me to pay interest of 5% and when i asked the reason behind demanding the interest she said something which was valuable things. She said me ""If i would not give you money then you will definitely ask money from some money lenders or your friends because now that watch is your first priority. And in that case you need to pay the higher interest rate to them. And in life there might be situation where we would not capable to help you in terms of financial. So this is the time you should learn to pay interest and responsibility of borrowing amount and repaying it on time with interest rate. This will help you also to learn a lesson and our money will be withing home I am not expert in parenting because i am still unmarried but i shared my point of view for your question. Thanks"', "In terms of preserving good relationships one approach is to charge a nominal rate of interest. maybe a few percent of the total and agree a time when it should be paid back. This may actually make them feel better about borrowing them money, especially, especially if it is something like business loan or buying a house or car. If they need the money for a real crisis and they have no clear strategy for paying it back then it may just be better all around if you make it clear that it is a gift. What you don't want to do is set up a situation where you are creating unnecessary problems down the road and that will very much depend on your individual relationship and how seriously you take the loan. Here it is important that you are completely open and honest about the arrangement so take the time to make sure that both parties understand exactly what they expect from each other."]

Is insurance worth it if you can afford to replace the item? If not, when is it?

["This entirely depends on two factors: Now let's look at what AppleCare gives you: What it covers is any manufacturing defect. It also covers you for phone support, as otherwise it's a $49-per-incident charge even for simple issues. It also covers any software issues that you may come across as long as the issues pertain to Apple software or the operating system itself. What it doesn't cover is any damage caused by the user. If you snap the corner of the screen, drop it, spill liquid on it, modify it, etc... then you're responsible for paying the repair costs. If you're outside of phone support, then you're going to have to pay someone to fix any problems you come across. Now if we're to trust this handy study done in 2009, then we can say that the 3-year failure rate for Macbooks and Macbook Pros is 17.4%. We could go ahead and say that $350 / $2000 = 17.5% so the chances match up, but what's the likelihood that Apple is going to cover the full $2000? Only under extreme cases are you losing the full $2000 (theft, shock damage, etc...), and those are all cases that Apple won't cover anyways. Instead we're looking at cases such as (Please keep in mind it has been several years since I worked for Apple, so these figures may be off): So this reduces our possible savings significantly. Let's then also look at what the warranty becomes after they fixed a part: A replacement part or Apple Product, including a user-installable part that has been installed in accordance with instructions provided by Apple, assumes the remaining term of the Warranty or ninety (90) days from the date of replacement or repair, whichever provides longer coverage for you. Which means in this case that you have a 90-day warranty after they've fixed an issue. This significantly reduces the likelihood of a same part going bad multiple times in a row. Therefore the chances of that $350 being worthwhile are very much against you. Even if the system does fail in some way, it is likely that the repair would be cheaper than the AppleCare. The chances of running into a repair or series of repairs that pays for the AppleCare and then some are astonishingly low. I would still get it if you were giving it to someone who was significantly lacking in any technology concepts (such as a parent or grandparent) as they are more likely to utilize the extended phone support, especially for smaller things that they might nag you about!", '"In general, if you can afford to replace something, you are able to ""self-insure"". You really want to understand a little of the statistics before you can make a generic call, but my rule of thumb is that insurance via ""extended warranty"" is rarely a good deal. Here is a simple expected value math formula you can apply (when the > is true, then you should buy it): replacement cost x likelihood of using warranty % > cost of insurance You can then back-compute, what is the likelihood that I\'d need to lose this item to break even? Given your numbers: $2000 x Y > $350 or Y > (350/2000) or Y > 17.5% So if you think there is a 17.5% or greater chance that you\'ll need to have you system replaced (i.e. not just a simple fix) AND (as Scott pointed out) you\'ll be able to actually use the replacement warranty then the applecare is a good purchase. Note, this only applies to items you can replace out-of-pocket without significant burden, because if you didn\'t have the $10k to replace your car, it wouldn\'t matter if the insurance wasn\'t such a good deal (especially if you need the car to get to work, etc.) So the obvious question is: ""Why would a for-profit company ever offer insurance on something they are statistically likely to lose money on?"" The obvious answer is ""they wouldn\'t,"" but that doesn\'t mean you should never buy this type of insurance, because you may have statistically significant circumstances. For instance, I purchased a $40 remote helicopter as a gift for my children. I also paid the $5 for a ""no questions asked"" warranty on it because, knowing my kids, I knew there was a nearly 100% chance they would break it at least once. In this case, this warranty was well worth the $5, because they did break it! Presumably they make money on these warranties because most of the purchasers of the plan are more attentive (or too lazy to make the claim) than in this case. Edit note: I incorporated Scott\'s comment about likelihood of being able to utilize the warranty into a combined ""likelihood of using warranty"" term. This term could be broken up into likelihood of needing replacement x likelihood of actually getting company to replace it I didn\'t do this above because it makes it a little harder to understand, and may not be a major factor in all cases, but you can definitely add it after the fact (i.e. if there\'s only a 90% chance Applecare will pay out at all, then divide the 17.5% by 0.9 to get 19.4% likelihood of needing the replacement for it to be cost effective). More complete formulas can be derived also (including terms for full replacement costs vs repair costs and including terms for ""deductible"" type costs or shipping), but I\'m trying to keep things relatively simple for those who aren\'t statistics nerds like I am."', '"In regards to purchasing full coverage on your car even if you can afford to replace it, consider the hassle you have to deal with an accident that is not just the cost. As an example, my sister\'s car was stolen and wrecked. It was her problem to go recover the car on the other side of the state such that she would not be paying the storage ""fees"" imposed by the sheriff of the other county. Had she had insurance they would have taken care of it call. Another story is that I rented a car and side swiped in the parking lot by a hit and run. I was responsible for the minor damage. I started down the path of paying out of pocket because it was small enough that I did not want to submit a claim. The rental car agency started to pile on extra fees such that it was worth it to turn in a claim. My insurance company was savvy enough to be able to dispute the extra charges. After I submitted it to the insurance company I basically did nothing. They took care of everything. So, in summary, when you buy full coverage on your car, it is not just a financial decision. It is also about not having to deal with a hassle."', 'The answer to this question is very different depending on the type of item. From a purely financial perspective you would want to answer these questions which you may not have enough information to answer: Realistically the question I prefer to ask are: When something fails there is a big difference to me between having the cash and having an insurance policy that is suppose to cover it even if they are theoretically the same value. Some insurance policies may even be better than cash, like homeowners insurance might help take care of details like finding a contractor to fix the issue, finding temporary housing if your house burns down, etc.', "Insurance is for events that are both and Unexpected and, for many people, catastrophic events are, for example, sickness, disability, death, car accidents, house fires, and burglaries, for which you may buy health, disability, life, auto, home, and renter's insurance. It may be catastrophic for a family relying on a very old earner for that earner to die, and you can buy life insurance up to a very old age, but the premiums will reflect the likelihood of someone of that age dying within the covered period. The more expected an event is, the more anything referred to as insurance is actually forced savings. Health insurance with no copays on regular checkups expects the insured to use them, so the cost of those checkups plus a profit for the insurance company is factored into the premiums ahead of time. A wooden pencil breaking may be unexpected. Regardless of foreseeability, no one buys insurance on wooden pencils, as the loss of a pencil is not catastrophic. What is catastrophic can be context dependent. Health-care needs are typically unforeseeable, as you don't know when you'll get sick. For a billionaire, needing health-care, while unforeseeable, the situation would not be catastrophic, and the billionaire can easily self-insure his or her health to the same extent as most caps offered by health insurance companies. If you're on a fixed budget buying a laptop, if it unexpectedly failed, that would be catastrophic to you, so budgeting in the cost of insurance or an extended warranty while buying your laptop would probably make sense. Especially if you need that $2000 laptop, spending an extra 17.5% would safeguard against you having to come out of pocket and depleting your savings to replace it, even though that brings you to a grand total of $2350 before taxes. However, if you're in that tight of a situation, I would strongly recommend you to find a less expensive option that would allow you to self-insure. If you found a used laptop for much less (I can even see Apple selling refurbished Macs for less than $1000) you might decide that your budget allows you to self-insure, and you could profit from being careful with your hardware and resolving to cover any issues with it yourself.", "Extended warranty or insurance is a tricky thing. In general, the big screen TV, or other electronics are going to become obsolete before they fail. Laptops, even Macs, are at risk for higher failure rates than other electronics. The question remaining is whether after the item has reached its 3rd or 4th birthday, if you would already be in the market for a newer model. In the big picture, if you have the money to buy a new replacement, or pay for a repair, you are better off to avoid the insurance. The highest failures are in the first year (aka 'infant mortality') and after N years, closer to 7-10, enough for obsolescence, than in years 2-5.", "As a rule, purchasing fairly priced (minus a spread) insurance on items you can afford to replace is a bad idea. However, in addition to the points mentioned in the previous answers, one should note that many types of insurance are UNDERpriced because on average people do not make claims even though they are entitled to them. If you purchase something moderately priced at Best Buy and get the extended warranty and it breaks down a year later, you will be unlikely to even remember that you purchased the insurance much less go through the trouble of making a claim. More likely you will just go buy a replacement or whatever the latest and greatest iteration is. It's like homeowner's insurance--an amazing number of things is covered but no one ever makes claims, so it is cheap. If you are a person who remembers and utilizes warranties and insurance, there are many types of insurance that will save you money in expectation. The other thing is that you know more about your own riskiness than the insurer does. I had a girlfriend who bought super comprehensive insurance on her crappy old car. I was quite stern with her about it but could not change her mind. She totaled it a few months later. They bought her a replacement. She got in a more serious accident with that car and got yet another one in addition to payment of her medical care, which did not even go to her health care insurance. Yes, her rates went up, but not fast enough to deal with how risky she was. Another example: I used to carry an e-book reader around in my shirt pocket and read it any time I had a chance. Cheap item and not that delicate, but since I had it with me all the time and used it constantly, it was a big risk for the store. The extended warranty would have been a great idea. In short, avoid extended warranties and insurance on things you can afford to lose unless you know that you are high risk or are otherwise more likely than average to make a claim.", "As many other posters have pointed out, unless you know (and your insurer doesn't) that because of any reason you are more likely than the average to damage your computer, insuring it doesn't really make a lot of sense if you can comfortably replace it should the worst happen. In this particular case of a laptop, insurance is especially unattractive because computers depreciate fairly quickly. If you break it... ...and you're insured, you will get the very same laptop you bought more than a year ago. ...and you're not insured, you can choose to either find the same laptop at a substantially lower price (Apple does not really lower prices that much but you can probably get a refurbished unit, just like you could get with AppleCare) or spend the original amount in a newer and more powerful laptop.", "Generically, like farnsy noted in the other answer, you will only come ahead in dollar terms when you are significantly riskier than the average insuree. Otherwise the insurance company would have higher rates to make a profit. In the case of Apple Care there can arguably be other factors involved. If you did not insure your $2000 laptop and it broke (unfixably) just after the warranty period, would you replace it with a new Apple product? Maybe not, so Apple could lose a customer. That means they have an incentive to keep you happy. If your product breaks but insurance replaces it, you are a happier customer and more likely to buy other Apple products. This is not an incentive for traditional insurance companies that only do business in insurance. Now, with the profit margins Apple likes in general, I don't know if they've underpriced their insurance. I sort of doubt it even. But their margins on it are probably not high, meaning it's a closer call even if you are only averagely risky.", '"The key point to answer the question is to consider risk aversion. Assume I suggest a game to you: Throw a coin and if you win, you get $5, if you lose nothing happens. Will you play the game? Of course, you will - you have nothing to lose! What if I suggest this: If you win, you get $10,000,005 and if you lose you must pay $10,000,000 (I also accept cars, houses, spouses, and kidneys as payment). While the expected value of the second game is the same as for the first, if you lose the second game you are more or less doomed to spend the rest of your life in poverty or not even have a rest of your life. Therefore, you will not wish to play the second game. Well, maybe you do - but probably only if you are very, very rich and can easily afford a loss (even if you had $11,000,000 you won\'t be as happy with a possible raise to $21,000,005 as you\'d be unhappy with dropping to a mere $1,000,000, so you\'d still not like to play). Some model this by taking logarithms: If your capital grows from $500 to $1000 or from $1000 to $2000, in both cases it doubles, hence is considered the same ""personal gain"", effectively. And, voíla, the logartithm of your capital grows by the same amount in both cases. This refelcts that a rich man will not be as happy about finding a $10 note as a poor man will be about finding a nickel. The effect of an insurance is that you replace an uncertain event of great damage with a certain event of little damage. Of course, the insurance company plays the same game, with roles swapped - so why do they play? One point is that they play the game very often, which tends to nivel the risks - unless you do something stupid and insure all inhabitants of San Francisco (and nobody else) against eqarthquakes. But also they have enough capital that they can afford to lose the game. In a fair situation, i.e. when the insurance costs just as much as damage cost multiplied with probability of damage, a rational you would eagerly buy the insurance because of risk aversion. Therefore, the insurance will in effect be able to charge more than the statistically fair price and many will still (gnawingly) buy it, and that\'s how they make a living. The decision how much more one is willing to accept as insurance cost is also a matter of whether you can afford a loss of the insured item easily, with regrets, barely, or not all."', 'Another factor to consider is that resale value of the laptop is quite bit more if it is still under warranty. This would apply to people who replace their laptop often. It is higher because the purchaser can be assured they are not getting a lemon. I determined this by comparing prices on ebay before selling my computer. Of course, if you keep your laptop longer than the warranty, this means nothing. But for me it meant I could sell my old laptop quickly and for a better price. Because I used my laptop for work and totally depended on it, even one day of downtime would cost me a lot, so it was worthwhile to keep a relatively new laptop under warranty. Also, for those using Apple Care, there is an undocumented perk: Apple covered an out of warranty repair on a time capsule under my apple care for my laptop even tho they were not purchased at the same time.', "Can you afford to replace it? What does that mean? Even if insuring means overpaying, it does spread the risk. NB: This example is not about the Applecare program, which I think is a waste of money for many people. Others have explained very well if it would work for you or not. I have a Macbook but no Applecare. I have an expensive smartphone with insurance for dropping and water damage, but not theft. After one year I cancel this insurance. I don't have $200K in my bank account."]

Do companies only pay dividends if they are in profit?

["Yes the company can still pay dividends even if they aren't making a profit. 1) If the firm has been around, it might have made profits in the past years, which it might be still carrying (check for retained earnings in the financial statements). 2) Some firms in the past have had taken up debt to return the money to shareholders as dividends. 3) It might sell a part of it's assets and return the gain as dividends. 4) They might be bought by some other firm, which returns cash to shareholders to keep them happy. It pays to keep an eye on the financial statements of the company to check how much liquid money they might be carrying around to pay shareholders as dividends. They can stop paying dividends whenever they want. Apple didn't pay a dividend while Steve Jobs was around, even though they were making billions in profits. Many companies don't pay dividends because they find it more beneficial to continue investing in their business rather than returning money to shareholders."]

I keep getting overcharged at the grocery store. Foul play?

["Of course, there is no way for us to know whether or not the clerk is trying to rip you off $1.29 at a time, but I can't understand the possible motivation for doing so. I would imagine that most people would catch this at some point, so for a store to consistently overcharge for something like this is really bad for business. They would be risking upsetting a customer all for the potential gain of $1.29. I have to assume that it is not malice, but incompetence. We don't know what caused the clerk to be confused, but it is not really our concern. From what I can tell, you've gotten the right price in the end. You were ultimately charged for two drinks, and the extra $1.29 that you were charged was refunded. Since it happened three times, you have to decide how badly you want these drinks in the future. If you choose to return, you'll just have to expect the possibility that it will ring up incorrectly, and you'll have to get it fixed. If that seems like too much hassle, then don't return to this store."]

Why is auto insurance ridiculously overpriced for those who drive few miles?

["There are several aspects to this but at a high level it boils down to A lot goes in to insurance rating and risk projecting. You can't adjust a single variable and expect a proportional change in your premium, 7,000 miles per year just won't be 70% of the cost of 10,000 miles per year, because there are a lot of other things in play as well. To further address premium adjustments. Consider this: Even if your liability coverage did scale with perfect correlation to your mileage (using the same 70% from above, 7,000 miles per year versus 10,000 miles per year) then your premium composition is: $200 to $170 is 15%. No change will have a direct linear correlation to your total premium because there are different component pieces of the total premium. Fixed costs may be built in to the amounts for other component pieces of the premium, for example maybe no line of coverage ever has a cost below $X. Obviously these numbers are all made up Additionally, and also less considered is the fact that your liability also scales because of a lot of factors that have nothing to do with you. It might be the other cars that are on the road, it might be that more densely populated areas have more fender benders. For example if you live in Beverly Hills you have a much higher likelihood of accidentally bumping a $70-$80-$90-$100k+ car than you do in say, rural Wisconsin. If your zip code is gentrifying and everyone starts buying Mercedes, your liability coverage increases. You can not adjust one single variable and decide that you are lower risk than all insurers think you are. If you shop this coverage and all insurers are within a nominal margin of pricing for the same coverage levels, there isn't much to argue with; you are simply riskier than you think you are and the variable you are focused on is not as meaningful as you think it is.", "Not all miles carry the same amount of risk. A survey by Progressive indicated that accidents are most likely to occur within 5 miles of home, and 77% of accidents occur within 15 miles of home. Only 1% of accidents occurred 50 or more miles from home. That's from 2002, but it seems unlikely to have changed much. Since the miles closest to your home carry more risk, they cost more, and low-mileage discounts reflect that. There are per-mile insurance options in a few states which could save you money, but they do constant monitoring via that ODB2 telematics device, and other insurers offer discounts if you accept their monitoring either in perpetuity or for a limited period of time. Without monitoring, insurers don't know if that 4,000 miles of driving is spread into a few mid-day trips each week, or maybe you're doing all that driving from midnight to 4am on weekends (fatalities far more likely), or from 5-7pm during weekdays (accidents far more likely). Personally, I save ~10% by being a 'low-mileage' driver, and am currently in the middle of a 90-day monitoring, so might go lower, but given that accidents are far more likely close to home, 10% feels pretty significant and appropriate.", "4000 miles a year is not a few! European average is about 9000... But nevertheless... But when it comes to risk, then: 1) Nothing stops you from changing circumstances and drive 10 times as much as in previous yers. The insurance remains the same. The only thing the insurance company can do is to charge you more next year (taking the miles you've made this year as a basis for calculations)* 2) Drivers who drive very seldom are a huge risk because of their low experience. I know a few people that drive more than 100 miles only a few times a year, and on average once a year have accident during that drives. It doesn't mean that an average sunday driver have similar risk of accident as daily driver, but it's in no way similar. *) Germany/Switzerland based, the whole EU is likely to be the same", 'Many services charge prices that do not scale linearly with usage. This is because the service provider has fixed costs that they must recoup by charging a rate with a fixed component. A 5-mile taxi ride is unlikely to cost half what a 10-mile taxi ride costs. Even a half sandwich at a sandwich place usually costs more than half of what a full sandwich costs. In this respect, insurance is no different from many other items you may purchase.', "Some proportion of the costs of a policy have little to no relationship to miles driven. Think of costs of underwriting, and more especially sales/marketing/client acquisition costs (auto insurance isn't in the same league as non-term life insurance (where the commissions and other selling expenses typically exceed the first year's worth of premiums), but the funny TV ads and/or agent commissions aren't free), as well as general business overhead. Also, as noted by quid, some proportion of claim risk isn't correlated to distance covered (think theft, flood, fire, etc.). There are also differences in the miles that are likely to be driven by a non-commercial/vehicle-for-hire driver who puts 25k miles a year vs. one who puts 7k per year. The former is generally going to be doing more driving at higher speeds on less-congested freeways while the latter will be doing more of their driving on crowded urban roads. The former pattern generally has a lower expected value of claims both due to having fewer cars per road-mile, fewer intersections and driveways, and also having any given collision be more likely to result in a fatality (paralysis or other lifetime disability claims are generally going to exceed what the insurer would pay out on a fatality).", "Other people lie to the companies about how many miles they drive, so they can't take the mileage figures literally. You aren't specifying whether you want liability only, or more-comprehensive insurance. Stuff happens when you aren't driving. Cars get stolen. Other drivers hit parked cars and leave. Trees fall on parked cars. Move to Virginia where insurance is not required. Just pay $500 a year for not having insurance, and be careful.", 'First you have to understand that insurance is basically a social system, just with Shareholders. Insurance costs consist of 3 factors: Now, to encourage a low-risk behavior a separating factor is search in the vast amount of statistical data. Drivers experience, miles and type of car being the most common, but also other things like oldtimer-status etc. are possible. If it so happens that the 3-5000 miles driver do only in average have 80% of the damage-costs of a comparable group 5-8000 miles driver, you´ll get the 20% bonus on factor 1. So the answer is, it is not overpriced, there is just no linear relationship to mileage. You can´t divide your insureds in too many groups or you´ll miss the mutual aspect of insurance. If everybody just pays his own risk, he can just do so in his bank and save on overhead and profit.', "There is plenty of over-rationalisation in the majority of these answers, when the simple answer is that it is simply down to statistics. Say an insurer had two pieces of information about two separate drivers: annual mileage, and whether they had had an accident in the last 3 years. Driver A drives 10,000 miles a year and hasn't had an accident in the past 3 years. Driver B drives 500 miles a year and hasn't had an accident in the past 3 years. Which would the insurer think was the safer bet? The answer is A, and this makes his premiums lower. The reason for this is that the insurer has a lot more data about Driver A than Driver B: they know that Driver A has driven 30,000 miles without having an accident. This could, of course, be luck, or a fluke, but it is likely that Driver A is actually a safe driver. The chance that Driver A hasn't had an accident just through sheer luck and that they are actually a terrible driver is quite slim. On the other hand, Driver B has only driven 1,500 miles in the past three years. Whilst this seems like prima facie evidence of them being as safe a driver as Driver A, it is much more likely that Driver B could have driven 1,500 miles and avoided an accident through sheer luck, even though they are a terrible driver. This means drivers who drive low amounts of mileage will be penalised relative to other drivers who have high mileage. It has nothing to do with insurers taking a judgement that 'doing more mileage makes you more experienced' or 'makes you a better driver' as others have suggested here (although, it is probably true - it's not quantifiable from an insurer's perspective).", "because it cost the insurer more, obviously. while this sounds snarky, it's important to realize that actual insurance companies set their insurance rates based on actual historical costs. for some reason people who report low miles have cost the company more dollars per reported mile than people who report high miles. in that sense, insurance is not overpriced. if it were truly overpriced, then an insurer would specialize in such insurance and make a killing on the free market. the more interesting questions is why do drivers who claim to travel very few miles cost the insurance companies so much per mile? that question has a host of possible answers and it's difficult to say which is the largest cost. here are just a few:", '"One reason is because car insurance is mandated. Mandated insurance means the government is forcing people to purchase it, which also means that everyone must have the opportunity to purchase it at a reasonable cost, even if the insurer would normally not choose to insure them. In mandated industries, risk pools are formed which means that as a whole, lower risk members partially subsidize higher risk members. In mandated industries that have a large risk variance, the insurance system would break down if everyone was charged their ""fair share"" because high risk members would be unable to afford a policy. (This is even more prominent with health insurance than car insurance because the difference in risk is vastly greater.) On a positive note, perhaps you may get a warm and fuzzy feeling knowing that you are helping out others ""in need""."', 'Insurance rates are about assessing risk. If the insurer has no way to reliably and easily assess usage, they will not reduce the premiums. Many companies are providing tracking devices that connect to the OBD-II port. This not only tracks actual miles driven, but can typically track aggressive driving, time of day, length of trips, and other information. Unless you are using this kind of device to give the insurer actionable feedback on your driving habits, do not expect any discounts for mileage or usage.', 'People who drive long distances tend to do more of their driving on larger, well-built roads (freeways / motorways) that are designed for high-speed driving. Although some people find them intimidating, they are much safer in terms of accidents per kilometre driven for several reasons:']

Can a bank hold my deposit on a closed account?

["What I'm reading is that they subtracted the $85 you owe them and they're cutting you a cashier's check for the rest. Ethically speaking, you owed them the money, they subtracted it and made you a check for the rest. Once you cash that check, nobody owes anyone anything in this equation. Sounds like they're in the clear. Legally speaking, I have no idea, since I'm not a lawyer, but even if it was not legal, good luck getting the $85 back without spending far more in retaining a lawyer and fighting it in court. Even fighting it in small claims court will take more of your time than $85 is worth. If it's your time that is the problem, 12 days is not horrible in banking terms. Yes, we're spoiled now by ACH transfers and same day deposit availability, but since you're retired, I'm sure if you think back you'll remember when it used to take two business weeks to clear a check... TLDR; cancel future deposits to that bank, find a new bank, then forget this fiasco and get your revenge by enjoying your life."]

Should I try to hedge my emergency savings against currency and political concerns?

["You have to balance several concerns here. The primary problem is that if you go to the effort of saving your money you want to also be sure that your savings will not lose too much of its value to inflation. Ukraine had a terrible inflation spike in 2015 for obvious reasons. Even as inflation has settled down in 2016, it is stabilizing around 12% which is very high Exchange rates are your next concern. If you lose a large percentage of the value of your money just in the process of exchanging it, that also eats away at the value of your money. If you accept the US Federal Reserve target of 2% inflation, then you should only exchange money that you will hold long enough that both exchange fees will outweigh the 10% inflation advantage. Even in cases where you have placed your money in a foreign currency, there's a chance that your government could freeze accounts denominated in foreign currencies, so there's always the political risk that you have to factor in. For that reason keeping foreign currency in cash also has some appeal because it cannot be confiscated as easily. You could still certainly be robbed, so keeping all of your savings in cash isn't a great solution either. All in all, you are diversifying your savings if you use the strategy of balancing all three methods. Splitting it evenly to 5% for each method isn't the most important. I would suggest taking advantage of good exchange rates (as they appear) to time when you buy foreign currency.", '"First thing is that your English is pretty damn good. You should be proud. There are certainly adult native speakers, here in the US, that cannot write as well. I like your ambition, that you are looking to save money and improve yourself. I like that you want to move your funds into a more stable currency. What is really tough with your plan and situation is your salary. Here in the US banks will typically have minimum deposits that are high for you. I imagine the same is true in the EU. You may have to save up before you can deposit into an EU bank. To answer your question: Yes it is very wise to save money in different containers. My wife and I have one household savings account. Yet that is broken down by different categories (using a spreadsheet). A certain amount might be dedicated to vacation, emergency fund, or the purchase of a luxury item. We also have business and accounts and personal accounts. It goes even further. For spending we use the ""envelope system"". After our pay check is deposited, one of us goes to the bank and withdraws cash. Some goes into the grocery envelope, some in the entertainment envelope, and so on. So yes I think you have a good plan and I would really like to see a plan on how you can increase your income."']

Why are interest rates on saving accounts so low in USA and Europe?

["The United States Federal Reserve has decided that interest rates should be low. (They think it may help the economy. The details matter little here though.) It will enforce this low rate by buying Treasury bonds at this very low interest rate. (Bonds are future money, so this means they pay a lot of money up front, for very little interest in the future. The Fed will pay more than anyone who offers less money up front, so they can set the price as long as they're willing to buy.) At the end of the day, Treasury bonds pay nearly no interest. Since there's little money to be made with Treasuries, people who want better-than-zero returns will bid up the current-price of any other bonds or similar loan-like instruments to get what whatever rate of return that they can. There's really no more than one price for money; you can think of the price of those bonds as basically (Treasury rate + some modifier based on the risk) percent. I realize thinking about bond prices is weird and different than other prices (you're measuring future-money using present-money and it's easy to be confused) and assure you it ultimately makes sense :) Anyway. Your savings account money has to compete with everyone else willing to lend money to banks. Everyone-else lends money for peanuts, so you get peanuts on your savings account too. Your banking is probably worth more to your bank on account of your check-card payment processing fees (collected from the merchant) than from the money they make lending out your savings (notice how many places have promotional rates if you make your direct deposits or use your check card to make a purchase N times a month). In Europe, it's similar, except you've got a different central bank. If Europe's bank operated radically differently for an extended period of time, you'd expect to see a difference in the exchange rates which would ultimately make the returns from investing in those currencies pretty similar as well. Such a change may show up domestically as inflation in the country with the loose-money policy, and internationally as weakness against other currencies. There's really only one price for money around the entire world. Any difference boils down to a difference in (perceived) risk.", '"The short answer is that banking is complicated, but the bank really doesn\'t need your money because it can get it from the Fed almost free, it can only use 90% of the money you give the bank, it can only make money on that 90% from very low-risk and thus low-return investments, and as it has to show a profit to its shareholders it will take whatever cut it needs to off the top of the returns. All of these things combine to make savings account interest roughly .05% in the US right now. The longer answer: All FDIC-insured banks (which the US requires all ""depositor"" banks to be) are subject to regulation by the Federal Reserve. The very first rule that all banks must comply with is that depositor money cannot be invested in things the Fed terms ""risky"". This limits banks from investing your money in things that have high returns, like stocks, commodities and hedges, because along with the high possible returns come high risk. Banks typically can only invest your savings in T-debt and in certain Fed-approved AAA bonds, which have very low risk and so very little return. The investment of bank assets into risky market funds was a major contributor to the financial crisis; with the repeal of the Glass-Steagall Act, banks had been allowed to integrate their FDIC-insured depositor business with their ""investment banking"" business (not FDIC insured). While still not allowed to bet on ""risky"" investments with deposits, banks were using their own money (retained profits, corporate equity/bond money) to bet heavily in the markets, and were investing depositor funds in faulty AAA-rated investment objects like CDOs. When the housing market crashed, banks had to pull out of the investment market and cash in hedges like credit-default swaps to cover the depositor losses, which sent a tidal wave through the rest of the market. Banks really can\'t even loan your money out to people who walk in, like you\'d think they would and which they traditionally used to do; that\'s how the savings and loan crisis happened, when speculators took out huge loans to invest, lost the cash, declared bankruptcy and left the S&Ls (and ultimately the FDIC) on the hook for depositors\' money. So, the upshot of all this is that the bank simply won\'t give you more on your money than it is allowed to make on it. In addition, there are several tools that the Fed has to regulate economic activity, and three big ones play a part. First is the ""Federal Funds Rate""; this is the interest rate that the Fed charges on loans made to other banks (which is a primary source of day-to-day liquidity for these banks). Money paid as interest to the Fed is effectively removed from the economy and is a way to reduce the money supply. Right now the FFR is .25% (that\'s one quarter of one percent) which is effectively zero; borrow a billion dollars ($1,000,000,000) from the Fed for one month and you\'ll pay them a scant $208,333. Banks lend to other banks at a rate based on the FFR, called the Interbank Rate (usually adding some fraction of a percent so the lending bank makes money on the loan). This means that the banks can get money from the Fed and from other banks very cheaply, which means they don\'t have to offer high interest rates on savings to entice individual depositors to save their money with the bank. Second is ""quantitative easing"", which just means the Fed buys government bonds and pays for them with ""new"" money. This happens all the time; remember those interest charges on bank loans? To keep the money supply stable, the Fed must buy T-debt at least in the amount of the interest being charged, otherwise the money leaves the economy and is not available to circulate. The Fed usually buys a little more than it collects in order to gradually increase the money supply, which allows the economy to grow while controlling inflation (having ""too much money"" and so making money worth less than what it can buy). What\'s new is that the Fed is increasing the money supply by a very large amount, by buying bonds far in excess of the (low) rates it\'s charging, and at fixed prices determined by the yield the Fed wants to induce in the markets. In the first place, with the Fed buying so many, there are fewer for institutions and other investors to buy. This increases the demand, driving down yields as investors besides the Fed are willing to pay a similar price, and remember that T-debt is one of the main things banks are allowed to invest your deposits in. Inflation isn\'t a concern right now despite the large amount of new money being injected, because the current economy is so lackluster right now that the new cash is just being sat upon by corporations and being used by consumers to pay down debt, instead of what the Fed and Government want us to do (hire, update equipment, buy houses and American cars, etc). In addition, the ""spot market price"" for a T-bond, or any investment security, is generally what the last guy paid. By buying Treasury debt gradually at a fixed price, the Fed can smooth out ""jitters"" in the spot price that speculators may try to induce by making low ""buy offers"" on T-debt to increase yields. Lastly, the Fed can tell banks that they must keep a certain amount of their deposits in ""reserve"", basically by keeping them in a combination of cash in the vault, and in accounts with the Fed itself. This has a dual purpose; higher reserve rates allow a bank to weather a ""run"" (more people than usual wanting their money) and thus reduces risk of failure. An increased reserves amount also reduces the amount of money circulating in the economy, because obviously if the banks have to keep a percentage of assets in cash, they can\'t invest that cash. Banks are currently required to keep 10% of ""deposited assets"" (the sum of all checking and savings accounts, but not CDs) in cash. This compounds the other problems with banks\' investing; not only are they not getting a great return on your savings, they can only use 90% of your savings to get it."', "There is really much simpler explanation for the interest rate differences in different countries. It is the interest rate arbitrage. It is a very well explored economic concept, so you can look it up on the Internet, in case you want to know more. 1) Interest rates for the same currency in different countries Basically, as one smart person here pointed out, there is only one price of money in free market economy. It happens, because investors can move their money unrestrictedly anywhere in the World to capitalize on the local interest rates advantage. For instance, if I can take a loan in the USA at 3-4% annual interest and receive 5-6% annual income on my dollar deposit in Russia, I would take a loan in the US and open a deposit in Russia to enjoy a risk free interest rate differential income of 2% (5-6% - 3-4% ~ 2%). So, would any reasonable person. However, in real World very few banks in Russia or anywhere would pay you an an interest rate higher than it can borrow money at. It'd probably lose money if it'd do so. Anyways, the difference between the risk free rate and interest rate on the dollar deposit can be attributed to the risk premium of this particular bank. The higher expected return, the greater risk premium. If there is a positive difference in the interest rates on the dollar deposits in different countries, it will almost entirely accounted for the risk premium. It is generally much riskier to keep money in, say Russian bank, than American. That's why investors want greater return on their dollar deposits in Russian banks than in American. Of course, if you'd want to park your USD in Russian bank you'd also have to consider transaction costs. So, as you may have already guessed, there is no free lunch. 2) Interest rates in different currencies for different countries If we are talking about the interest rates in different sovereign currencies, it is a somewhat similar concept, only there is more risk if you keep money in local currency (risk premium is much higher). Probably, the biggest component of this risk is inflation (that is only attributed to the prices in local currency). For that reason, current interest rates on deposits in Russian Rubles are at 10-12%, but only 1-3% in the US Dollars. An economic concept that discusses this phenomenon in great detail is Interest Rate Parity. Hope this was helpful. P.S. It doesn't look quite realistic that you can get an 8% annual income for USD deposit in Russia with the interest rates in the U.S. being at 1-2%. At present moment, a 30-year mortgage annual interest rate in the US is at ~2-3% and an annual interest rates for dollar deposits in Sberbank (one of the safest Russian banks = very little risk premium) is at 1-3%. So, arbitrage is impossible.", 'Typically developing economics are marked by moderate to high inflation [as they are growing at a faster pace], higher in savings rate and higher lending rates. If you reduce the lending rate, more business / start-up will borrow at cheaper rate, this in turn means lowers savings rate and leads to higher inflation. To combat this Central Banks make borrowing expensive, which lowers inflation and increases the saving rate. Essentially all these 3 are tied up. As to why these countries offer higher interest on USD is because most of the developing countries have trade [current account] deficit. They need to bring in more USD in the country. One of the ways is to encourage Non Resident Citizens to park their foreign earning back home, ensuring more funds USD inflow. The rate differential also acts as a guide as to how the currency would be valued against USD. For example if you get 8% on USD, less than 12% had you converted same to Rouble, at the end of say 3 years, the exchange rate between USD and Rouble would factor that 4%, ie rouble will go down. Developed countries on the other hand are marked by low inflation [they have already achieved everything] as there is no spurt in growth, it more BAU. They are also characterized by low savings and lending rates.', '"The 8% rate offered by Russian banks on US Dollar accounts reflects the financial problems they have. They would prefer to lend US Dollars on the international financial markets at the same rate as US banks, but loans to Russian banks are considered to be more risky. In fact, the estimated ""default"" risk is ~6%. Your ruble deposits at Russian banks are most likely backed by state guarantees, which reduces the risk and therefore the effective interest rate."', 'Banks in general will keep saving rates as low as possible especially if there is a surplus of funds or alternative access for funding as in the case of the Fed in the USA. Generally speaking, why would bank pay you a high interest rate when they cannot generate any income from your money? Usually we will expect to see a drop in the loan interest rate when their is a surplus of funds so as to encourage investment. But if the market is volatile then no banks will allow easy access to money through loans. The old traditional policy of lending money without proper security and no control from the central bank has created serious problems for savings account holders when some of these banks went into bankruptcy. It is for this reason most countries has modified their Financial Act to offer more protection to account holders. At the moment banks must follow rigid guidelines before a loan can be approved to a customer. In my country (Guyana) we have seen the collapse of a few banks which sent a shock wave across the county for those that have savings held at those bank. We have also seen unsecured loans having to be written off thus putting serious pressure of those banks. So government stepped in a few years ago and amended the act to make it mandatory to have commercial banks follow certain strict guidelines before approving a loan.', 'Some comments above are inaccurate. Advertised interest rates for deposits and savings in Russia (from Russian banks) are generally for Ruble (RUB) denominated accounts; however, USD and EUR denominated accounts still offer favorable interest rates when compared to Western counterparts. For example, Sberbank advertises these Annual Interest Rates: RUB — 8.79–11.52% USD — 2.05–5.31% EUR — 2.05–5.21%']

UK Contractor with Limited Company

["I know a guy on a much higher rate than me, about £500 per day, and he claims to pay around 18% tax which has me bewildered He will be showing expenses, which are deductible. Check with your accountant about expenses, which can be legally claimed as expenses. This is the main benefit of operating through a limited company. Legtimate business expenses can be claimed, which you cannot do if you are a permanent employee. Your friend might also be claiming false expenses, with a shady accountant. If HMRC does decide to give a call, he might have to pay n times the money he has saved till now. And my suggestion is always ask your accountant first. He(she) knows the legal stuff, so he(she) would give you the legally correct options. If you aren't comfortable with him(her), you can always change accountants. holiday pay, sick pay and job security You miss those that is why you are paid at a rate much higher than an employee. benefit of a limited company You can arrange your salary to pay no PAYE and take the rest as dividends. You willn't have to pay PAYE on that. Secondly if you have a partner(s), all of you can be paid dividends without paying PAYE(if you don't cross the threshold).", '"I know a guy on a much higher rate than me, about £500 per day, and he claims to pay around 18% tax which has me bewildered Your acquaintance may be using a tax efficient, or ""marketed avoidance"" product identical or similar to those required to be registered or declared under DOTAS legislation in the UK. If this is the case then no, your accountant is not doing anything wrong - the 18% ""tax"" probably involves a radially different remuneration mechanism to the one you are using."']

How will going from 75% Credit Utilization to 0% Credit Utilization affect my credit score?

["I wrote an article about FICO scoring which shows that 30% of your score is based on utilization or amount owed. I can't say exactly how much your score will rise, or how long it will take, but your score will improve dramatically from what you propose. This chart is from Credit Karma, and it shows how zero utilization is actually bad when it comes to your score. I wrote an article on my blog titled Too Little Debt in which I discuss further. Under 20% is ideal, just not zero.", '"You really don\'t know how credit scoring works. Let\'s think about the purpose of a credit score: to assess whether you\'re a high default risk. A lender wants to know, in this order: Utilization factors into the solvency assessment. If you are at 100% utilization of your unsecured credit, you\'re insolvent -- you can\'t pay your bills. If you are at 0%, you\'re as solvent as you can be. Most people who use credit cards are somewhere in the middle. When a bank underwrites a large loan like a mortgage or car loan, they use your credit score an application information like income and employment history to figure out what kind of loan you qualify for. Credit cards are called ""revolving"" accounts for a reason -- you\'re supposed to use them to buy crap and pay your bill in full at the end of the month. My advice to you:"']

Better rate for investment between CD or savings

["Excel has two functions you can use: Your question has the CD with a APR and the savings account that mentions both APR and APY. So convert them both to APY to compare them. The savings account (2.27 APY) will return more money based on the numbers in your question (2.27% vs 1.56%) The previous part was the math part of the answer. The following takes into other considerations. For this case the Savings account will return a larger amount of money if the conditions don't change. The CD rate is guaranteed, but the savings account could change every business day. The savings rate could go up, or down. If you expect the savings account rate to rain higher than the CD you might not want to lock into the CD. If you expect the savings rate will drop then get the CD. Of course there are penalties if you cash in the CD early."]

At what interest rate should debt be used as a tool?

['"I\'ve been taking all the cheap fixed-rate debt banks would like to give me lately. What Rate? In practice I find the only way I get a low-enough rate on a longish-term fixed-rate loan is to use collateral. That is, auto loans and home loans. I haven\'t seen any personal loans with a low enough fixed rate. (Student loans may be cheap enough if they\'re subsidized, I guess.) Here\'s how I think of the rate: If you look at https://personal.vanguard.com/us/insights/saving-investing/model-portfolio-allocations , the average annual return on 80% bonds / 20% stocks is 6.7%, with worst year -10.3%. That\'s a nominal return not a real return. If you subtract taxes, say your marginal rate (the rate you pay on your last dollar of income) is 28% federal plus 5% state, then if you have no tax deferral the 6.7% becomes about a 4.5% average, with reasonably wide variation year-by-year. (You can mess with this, e.g. using tax-exempt bonds and tax-efficient stock funds, etc. which would be wise, but for deciding whether to take out debt, getting too detailed is false precision. The 6.7% number is only an average to begin with, not a guarantee.) Say you pay 4.5% on a loan, and you keep your money in very conservative investments, that\'s probably at least going to break even if you give it some years. It certainly can and sometimes will fail to break even over some time periods, but the risk of outright catastrophe is low. If your annual loss is 10%, that sucks, but it should not ruin your life. In practice, I got a home loan for close to 4.5% which is tax-deductible so a lower effective rate, and got an auto loan subsidized by the manufacturer for under 3%. Both are long-term fixed-rate loans with collateral. So I was happy to borrow this money paying about a 3% effective rate in both cases, well below my rough threshold of 4.5%. I do not, however, run a credit card balance; even though one of my cards is only 7% right now, 7% is too high, and it\'s a floating rate that could rise. The personal loans I\'ve seen have too-high rates also. Thoughts Overall I think using debt as a tool requires that you\'re already financially stable, such that the debt isn\'t creating a risky situation. The debt should be used to increase liquidity and flexibility and perhaps boost investment returns a bit. Where you\'re likely to get into trouble is using debt to increase your purchasing power, especially if you use debt to buy things that aren\'t necessary. For me the primary reason to use debt is flexibility and liquidity, and the secondary ""bonus"" reason is a possible spread between the debt rate and investment returns."', '"Money is a commodity like any other, and loans are a way to ""buy"" money. Like any other financial decision, you need to weigh the costs against the benefits. To me, I\'m happy to take advantage of a 0% for six months or a modest 5-6% rate to make ""capital"" purchases of stuff, especially for major purchases. For example, I took out a 5.5% loan to put a roof on my home a few years ago, although I had the money to make the purchase. Why did I borrow? Selling assets to buy the roof would require me to sell investments, pay taxes and spend a bunch of time computing them. I don\'t believe in borrowing money to invest, as I don\'t have enough borrowing capacity for it to me worth the risk. Feels too much like gambling vs. investing from my point of view."', '"Average return on the S&P500 over the last 10 years has been 1.6 %; so if you\'d invested in that with money borrowed at 3 % you would have lost (so far). Investing with borrowed money implies you think you can beat the market: that you\'re a cleverer investor than whoever decided to lend you the money. Whoever decided to lend you the money decided that you are the best (return/risk ratio) investment for their money. It might make sense to invest borrowed money if you don\'t need to pay it back if things go wrong: if you\'re an investment professional whose bonus depends on the profit you make, but who won\'t need to repay any loss. It might also makes sense to borrow money if you\'re going to \'add value\', e.g. sweat equity: for example if you use it to renovate a house or (if you\'re a business) to hire more staff. But the question was ""What guidelines do you use"" and the answer is, ""I don\'t make passive investments with borrowed money."" My Dad did it, i.e. didn\'t repay his mortgage as soon as he could have: but that was because (back in the \'70s) he had a long-term (government-sponsored) mortgage for about 1.5 % (designed to help first-time buyers or something like that), at a time when banks were paying higher interest rates on (ultra-safe) deposits."', "This is a very interesting question. I'm going to attempt to answer it. Use debt to leverage investment. Historically, stock markets have returned 10% p.a., so today when interest rates are very low, and depending on which country you live in, you could theoretically borrow money at a very low interest rate and earn 10% p.a., pocketing the difference. This can be done through an ETF, mutual funds and other investment instruments. Make sure you have enough cash flow to cover the interest payments! Similar to the concept of acid ratio for companies, you should have slightly more than enough liquid funds to meet the monthly payments. Naturally, this strategy only works when interest rates are low. After that, you'll have to think of other ideas. However, IMO the Fed seems to be heading towards QE3 so we might be seeing a prolonged period of low interest rates, so borrowing seems like a sensible option now. Since the movements of interest rates are political in nature, monitoring this should be quite simple. It depends on you. Since interest rates are the opportunity cost of spending money, the lower the interest rates, the lower the opportunity costs of using money now and repaying it later. Interest rates are a market mechanism so that people who prefer to spend later can lend to people who prefer to spend now for the price of interest. *Disclaimer: Historically stocks have returned 10% p.a., but that doesn't mean this trend will continue indefinitely as we have seen fixed income outperform stocks in the recent past.", "It's not so much the rate of the debt as it is the total cost of the debt relative to the gain you expect to see from using it to purchase something of value. I've known people who were quite happy to pay 12% on personal loans used to buy investment properties for flipping. They're happy to pay that because conventional loans from banks require too much documentation and out-of-pocket expense. For some investors, 12% without all of the documentation burden is money well spent. So if I'm the investor, and the interest on this 12% loan is $5,000 and I can flip a property for $20,000 after all of the other expenses, then the 12% loan was an enabler to netting $15,000 profit.", 'This post has a great discussion on the topic. Basically, there is no single interest rate above which you should pay off and below which you should keep. You have to keep in mind factors such as', "It's tough to borrow fixed and invest risk free. That said, there are still some interesting investment opportunities. A 4% loan will cost you 3% or less after tax, and the DVY (Dow high yielders) is at 3.36% but at a 15% favored rate, you net 2.76% if my math is right. So for .5%, you get the fruits of the potential rise in dividends as well as any cap gains. Is this failsafe? No. But I believe that long term, say 10 years or more, the risk is minimal.", "I don't really see it as worth it at any level because of the risk. If you take $10,000,000 using the ratios you gave making 2% return. That is a profit of $200,000. Definitely not worth it, but lets go to 20% profit that is $2,000,000. To me the risk involved at beint 10 million in debt isn't worth it to make $2,000,000 quickly it would be pretty easy doing something wrong to wipe out everything."]

How can contractors recoup taxation-related expenses?

['They are already indirectly paying these expenses. They should be built into your rates. The amount per job or per hour needs to cover what would have been your salary, plus the what would have been sick, vacation, holidays, health insurance, life insurance, disability, education, overhead for office expenses, cost of accountants...and all taxes. In many companies the general rule of thumb is that they need to charge a customer 2x the employees salary to cover all this plus make a profit. If this is a side job some of these benefits will come from your main job. Some self employed get some of these benefits from their spouse. The company has said we give you money for the work you perform, but you need to cover everything else including paying all taxes. Depending on where you live you might have to send money in more often then once a year. They are also telling you that they will be reporting the money they give you to the government so they can claim it as a business expense. So you better make sure you report it as income.', '"Anything is negotiable. Clearly in the current draft of the contract the company isn\'t going to calculate or withhold taxes on your behalf - that is your responsibility. But if you want to calculate taxes yourself, and break out the fees you are receiving into several ""buckets"" on the invoice, the company might agree (they might have to run it past their legal department first). I don\'t see how that helps anything - it just divides the single fee into two pieces with the same overall total. As @mhoran_psprep points out, it appears that the company expects you to cover your expenses from within your charges. Thus, it\'s up to you to decide the appropriate fees to charge, and you are assuming the risk that you have estimated your expenses incorrectly. If you want the company to pay you a fee, plus reimburse your expenses, you will need to craft that into the contract. It\'s not clear what kind of expenses you need to be covered, and sometimes companies will not agree to them. For specific tax rule questions applicable to your locale, you should consult your tax adviser."']

What is the best way for me to invest my money into my own startup?

['"It will depend somewhat on the rules where the company is formed, and perhaps how much you\'re talking about investing. I don\'t know about Canada, but when I\'ve formed businesses in the U.S., I\'ve been advised to invest some of the money as an equity investment, and the bulk of the remainder as a loan. You say ""more shares"", so it sounds like you\'ve already invested some money and need to inject another round. If you make a loan to the company, make sure everything is done at arm\'s length -- you\'ll need to wear the hat of the Company Management and sign a contract with yourself, use a market-based interest rate, and make sure the company is paying you back with interest. An alternative which may work if you expect cash flow soon is to pay for certain expenses personally and then submit an expense report to the company, which will pay you back. Overall, a quick consultation with your accountant should be a relatively inexpensive way to get the best answer for your specific circumstances."', 'Ask your accountant about convertable preference shares. This would permit you to loan money to your company and then convert the debt to equity, should you so choose, at a later stage. As with the answer by bstpierre, these are all contractual arrangements conducted at arms-length.']

Which countries allow eChecks?

["eChecks (and ACH) are a (desperate?) try of the US banking system to get into the 21st century. All EU countries (and some others) have direct deposits and transfers as the standard way of transferring money since about 20 years, and since about 5 years it is cost-free and one-day across all the EU. The rest of the world runs mostly country specific system, as there is not that large a demand for cross country shifting, and exchange rates are also an issue in any such transaction. Because they have different ways that work fine since decades, other countries will consider the eCheck idea as a step backwards and will probably ignore it, so your answer is 'none'. International companies work with banks in a different relationship than retail customers, so they can do things you and me cannot do - depending on size and volume. Some large companies get a banking license and then handle their own stuff; medium sized companies make favorable contracts with banks (they are golden goose customers - never an issue, no brick and mortar presence needed, banks love them), or they simply suck up the transfer cost (if you move millions, who cares about a 40 $ fee). Small businesses whine and live with what they get..."]

Which technical indicators are suitable for medium-term strategies?

["If I knew a surefire way to make money in FOREX (or any market for that matter) I would not be sharing it with you. If you find an indicator that makes sense to you and you think you can make money, use it. For what it's worth, I think technical analysis is nonsense. If you're just now wading in to the FOREX markets because of the Brexit vote I suggest you set up a play-money account first. The contracts and trades can be complicated, losses can be very large and you can lose big -- quickly. I suspect FOREX brokers have been laughing to the bank the last couple weeks with all the guppies jumping in to play with the sharks.", 'Speaking from stock market point of view, superficially, TA is similarly applicable to day trading, short term, medium term and long term. You may use different indicators in FX compared to the stock market, but I would expect they are largely the same types of things - direction indicators, momentum indicators, spread indicators, divergence indicators. The key thing with TA or even when trading anything, is that when you have developed a system, that you back test it, to prove that it will work in bear, bull and stagnant markets. I have simple systems that are fine in strong bull markets but really poor in stagnant markets. Also have a trading plan. Know when you are going to exit and enter your trades, what criteria and what position size. Understand how much you are risking on each trade and actively manage your risk. I urge caution over your statement ... one weakened by parting the political union but ought to bounce back ... We (my UK based IT business) have already lost two potential clients due to Brexit. These companies are in FinServ and have no idea of what is going to happen, so I would respectfully suggest that you may have less knowledge than professionals, who deal in currency and property ... but one premise of TA is that you let the chart tell you what is happening. In any case trade well, and with a plan!']

How to pay taxes on YouTube if I'm a dependent?

['"The Form 1040 (U.S. tax return form) Instructions has a section called ""Do You Have To File?"". Below a certain income, you are not required to file a tax return and pay any tax. This amount of income at which you are required to file depends on several things, including your dependency status (you are a dependent of your parents), your marital status, and other factors. The instructions have charts that show what these numbers are. You would fall under Chart B. Assuming that you are under age 65, unmarried, and not blind, you only have to file when you reach the following conditions: Your unearned income was over $1,050. Your earned income was over $6,300. Your gross income was more than the larger of— $1,050, or Your earned income (up to $5,950) plus $350. (Note: Income from YouTube would count as ""earned income"" for the purposes above.) However, if you are producing your own videos and receiving revenue from them, you are technically self-employed. This means that the conditions from Chart C also apply, which state: You must file a return if any of the five conditions below apply for 2015. As a self-employed person, you can deduct business expenses (expenses that you incur in producing your product, which is this case is your videos). Once your revenue minus your expenses reach $400, you will need to file an income tax return."']

Recording of personal property contribution to S-Corp in QuickBooks

["One approach would be to create Journal Entries that debit asset accounts that are associated with these items and credit an Open Balance Equity account. The value of these contributions would have to be worked out with an accountant, as it depends on the lesser of the adjusted basis vs. the fair market value, as you then depreciate the amounts over time to take the depreciation as a business expense, and it adjusts your basis in the company (to calculate capital gains/losses when you sell). If there were multiple partners, or your accountant wants it this way, you could then debit open balance equity and credit the owner's contribution to a capital account in your name that represents your basis when you sell. From a pure accounting perspective, if the Open Balance Equity account would zero out, you could just skip it and directly credit the capital accounts, but I prefer the Open Balance Equity as it helps know the percentages of initial equity which may influence partner ownership percentages and identify anyone who needs to contribute more to the partnership."]

Should I really pay off my entire credit card balance each month or should I maintain some balance?

["You should pay things off every month. You don't want to be paying 10%-25% interest if you don't have to. If you regularly use you card, the credit agencies can't tell the difference. The way it works is that every month, they send the credit agencies your current balance and if you paid the last bill on time. There is nothing that indicates if this is a standing balance, or if you charged all of it since the last payment. Any business that you legitimately owe a debt to can report that to the credit agencies. Not all of them do. This includes utilities, cell phone companies, landlords, etc. If any of them report overdue items it will show up on your credit report, and your credit card company can use that to raise you interest rate. Some cards will automatically raise you credit limit. They are basically looking to make money fro you. If you often charge near the limit, and pay the minimum balance each month, they may raise your limit to get you to charge more, and pay more interest. You can also call them and ask. They have some internal rules to decide if, based on your history with them and your credit history, if you are a good risk.", "I think you got the message mixed up a little: Racking up big balances can hurt your scores, regardless of whether you pay your bills in full each month. What's typically reported to the credit bureaus, and thus calculated into your scores, are the balances reported on your last statements. (That doesn't mean paying off your balances each month isn't financially smart -- it is -- just that the credit scores don't care.) You typically can increase your scores by limiting your charges to 30% or less of a card's limit. -- from 7 Ways to Fix Your Credit Score In other words, ALWAYS pay off your balance if you can. But don't fill up your card to the max of your credit limit each month. i.e. if your credit limit is $5000, only spend $2000 each month.", 'Always pay on time, and stop listening to whoever is telling you not to -- they are clueless. Credit cards are revolving accounts with a grace period. The balance owed is due on the statement date, and you have a grace period of 20-40 days to pay. Paying bills on time is the single most important thing that you can do to have a good credit score. Always pay on time.']

Does the Fed keeping interest rates low stimulate investment in the stock market and other investments?

["Investopedia has this note where you'd want the contrapositive point: The interest rate, commonly bandied about by the media, has a wide and varied impact upon the economy. When it is raised, the general effect is a lessening of the amount of money in circulation, which works to keep inflation low. It also makes borrowing money more expensive, which affects how consumers and businesses spend their money; this increases expenses for companies, lowering earnings somewhat for those with debt to pay. Finally, it tends to make the stock market a slightly less attractive place to investment. As for evidence, I'd question that anyone could really take out all the other possible economic influences to prove a direct co-relation between the Federal Funds rate and the stock market returns. For example, of the dozens of indices that are stock related, which ones would you want that evidence: Total market, large-cap, small-cap, value stocks, growth stocks, industrials, tech, utilities, REITs, etc. This is without considering other possible investment choices such as direct Real Estate holdings, compared to REITs that is, precious metals and collectibles that could also be used."]

How to find if a public company has taken out a loan?

["Somewhat. The balance sheet will include liabilities which as Michael Kjörling points out would tell you the totals for the debt which would often be loans or bonds depending on one's preferred terminology. However, if the company's loan was shorter than the length of the quarter, then it may not necessarily be reported is something to point out as the data is accurate for a specific point in time only. My suggestion is that if you have a particular company that you want to review that you take a look at the SEC filing in full which would have a better breakdown of everything in terms of assets, liabilities, etc. than the a summary page. http://investor.apple.com/ would be where you could find a link to the 10-Q that has a better breakdown though it does appear that Apple doesn't have any bonds outstanding. There are some companies that may have little debt due to being so profitable in their areas of business."]

What is a Master Limited Partnership (MLP) & how is it different from plain stock?

["I was hesitant to answer this question since I don't own MLP even though I'm aware of how they work. But hear crickets on this question, so here goes. I'll try to keep this as non technical as possible. MLPs are partnerships where a shareholder is a partner and liable for the partnership's taxes. MLPs don't pay corporate tax since the tax burden flows to you, the shareholder. So does that mean like a partnership the partners are liable for the company's actions? Technically, yes. Has it happened before? No. Of course there are limitations to the liability, but are not definitely shielded in a way normal shareholders are. MLPs issue a K-1 at the beginning of the year (feb/mar). The tax calculations are relatively complex and I'm not going to go over that in this post. Generally MLPs are a bad choice for tax-deferred accounts like IRAs since there are tax implications beyond certain limits of distribution (yes even out of an IRA you'll have to pay taxes if above the limit). Not all types of businesses can become MLPs (hey no corporate tax, let's form an MLP!) Only companies engaged in businesses related to real estate, commodities or natural resources can become MLPs. There are a number of MLPs out there. The largest is Kinder Morgan Energy Partners. Hope this helps!", "I own a few MLPs that operate oil/gas pipelines (TSE:IPL-UN, NYSE:BPT, NYSE:APL), and I'm very happy with their performance. Because they don't pay corporate tax MLPs tend to pay higher dividends than most regular stocks. I pay H&R Block to do my taxes, and they sort out all the arcane details.", '"MLP stands for master limited partnership. Investors who buy into one are limited partners, rather than shareholders, and have their taxable income reported on K-1s, rather than 1099s. MLPs are engaged in businesses (e.g. real estate, natural resources) that generate a lot of cash that doesn\'t need to be ""reinvested,"" or put back into the company. Because of this feature, the IRS will exempt it from corporate tax if it pays out at least 95% of its income in the form of dividends. The advantage is that you avoid the ""double taxation"" common to most corporations, and get a higher yield as a result. The disadvantage is that the company can\'t retain earnings for growth, and needs to borrow money if it wants to grow. In this regard, an MLP is much like a utility (except that a utility has to pay corporate taxes, and is otherwise heavily regulated by the Federal and/or state governments). You can look upon an MLP as an unregulated utility. This means that MLPs are most suitable for utility type investors who are more interested in current income, than capital gains. Because they are unregulated, they are riskier than utilities."', 'My question is: absent the corporate shield, to what extent are partners liable for a serious disaster or accident such as the BP Gulf incident. IN other words, if an oil pipeline had a major spill or explosion in which there were serious liabilities, to what extent would this effect the owners of a listed partnership beyond the effects of corporate liability on a common stock holding?']

How to account for a shared mortgage in QuickBooks Online?

["How you should record the mortgage payments depends on if you are trying to achieve correct accounting, according to the standards, or if you are just tracking everything for you and your friends. If you're just keeping track for personal reasons, I'd suggest that you set up your check (or journal entry, your preference) how you'd like it to be recorded. Then, memorize that transaction. This allows you to use it as many times as you need to, without having to set it up each time. (Also note: there is no way to record a transaction that decreases cash and increases equity.) If you're trying to keep track of everything according to accounting standards, which it should be if you've set up an official business, then you have a lot more tracking to do with each payment. Mortgage payments technically do not affect the equity accounts of the owners. Each mortgage payment should decrease the bank balance, increase interest expense and decrease the mortgage balance, not to mention tracking any escrow account you may have. The equity accounts would be affected if the owners are contributing funds to the bank account, but equity would increase at the time the funds are deposited, not when the mortgage payments are made. Hope this helps!", 'You could classify the mortgage as a different assets class and then create automated additions and deductions to the account as deems fit. other than that quickbooks online is a bit fishy so it seems.', 'What is the corporate structure? Your partnership agreement or LLC operating agreement should dictate how you approach this.']

Money transfer to the U.K

['"I\'d recommend an online FX broker like XE Trade at xe.com. There are no fees charged by XE other than the spread on the FX conversion itself (which you\'ll pay anywhere). They have payment clearing facilities in several countries (including UK BACS) so provided you\'re dealing with a major currency it should be possible to transfer money ""free"" (of wire charges at least). The FX spread will be much better than you would get from a bank (since FX is their primary business). The additional risk you take on is settlement risk. XE will not pay the sterling amount to your UK bank account until they have received the Euro payment into their account. If XE went bankrupt before crediting your UK account, but after you\'ve paid them your Euros - you could lose your money. XE is backed by Custom House, which is a large and established Canadian firm - so this risk is very small indeed. There are other choices out there too, UKForex is another that comes to mind - although XE\'s rates have been the best of those I\'ve tried."', "I've been using xetrade for quite awhile, also used nzforex (associated with ozforex / canadian forex, probably ukforex as well) -- xetrade has slightly better rates than I've gotten at nzforex, so I've been using them primarily. That said, I am in the process of opening an account at CurrencyFair, because it appears that I'll be able to exchange money at better rates there. (XETrade charges me 1.5% off the rate you see at xe.com -- which is the FX conversion fee I believe -- there are no fees other than the spread charged). I think the reason CurrencyFair may be able to do better is because the exchange is based on the peer-to-peer trade, so you could theoretically get a deal better than xe.com. I'll update my answer here after I've been using CurrencyFair for awhile, and let you know. They theoretically guarantee no worse than 0.5% though (+ $4.00 / withdrawal) -- so I think it'll save me quite a bit of money."]

Transfering money from NRE to saving account is taxable or not

["Meagrely transferring money within your own accounts doesn't result in any tax, however legally once you are an NRI you cannot operate a savings account at all as per Reserve Bank Guidelines found here One option is for you to transfer to a joint account held by a close relative of yours with you and this would be tax free in India.", 'There are quite a few things here; Edit: If you are away for 2.5 Years, you are NRE. Your situation is slightly tricky in the sense that you are getting a salary in India for doing work outside. Please consult a professional CA who can advise you better. If you were not getting an Indian salary, then whatever you earn outside India is non-taxable and you can transfer it into your NRE account. As per regulations an NRI cannot hold a savings account. Point 3 is more applicable if you are on a short visit.']

Are there any credit cards with a statement period longer than 1 month?

["Most credit cards will allow you to pick the closing date. In fact almost every bill with the exception of utilities that collected usage by reading a meter at the house will either let you pick the closing date each month, or at least have several to pick from. They won't let you pick the length, but they will let you pick the day of the month. When I worked a job that paid once a month. I wanted all my bills due early in the month: get paid, pay bill, know how much I have left. When I went back to every other week spreading them out made more sense. No credit card had a problem with this. The transitional cycle was not the correct length, but after that it was fine. As Dheer pointed out extending the cycle to 90 days would involve them extending credit for much longer than they would be comfortable. Also the goal of keeping utilization under 30% would be very difficult, you would have to keep your spending per month to less than 10% of your credit limit. Some people have trouble not falling behind on credit card bills, having to set aside the money to pay the bill every 90 day may be way to tough for many people.", 'If the billing cycle is 2 to 3 months, it would mean Banks have to give credit for a longer period and it makes the entire business less profitable as well as more risky compared to the Monthly billing cycle. For example the current monthly billing cycle with a date say of 14th, means if you swipe your card on 1st day, one would effectively get a credit for 30+14, around 44 days. If you swipe on last day, one would get a credit for 14 days. On an average 22 days of credit. If we make this 3 months, the credit period would increase on an average (90+14)/2, 52 days. From a risk point of view, on monthly cycle if there is non-payment its flagged much earlier compared to a 3 months cycle. On offering different dates, shop around. In the older times the cycles were different, however with individuals having several cards, and trying to optimize every purchase to maximize credit period. Quite a few banks have streamlined it to monthly cycle. Shop around and some banks should be able to offer you different dates.']

how much of foreign exchange (forex/fx) “deep liquidity” is really just unbacked leverage and what is the effect?

['"In essence the problem that the OP identified is not that the FX market itself has poor liquidity but that retail FX brokerage sometimes have poor counterparty risk management. The problem is the actual business model that many FX brokerages have. Most FX brokerages are themselves customers of much larger money center banks that are very well capitalized and provide ample liquidity. By liquidity I mean the ability to put on a position of relatively decent size (long EURUSD say) at any particular time with a small price impact relative to where it is trading. For spot FX, intraday bid/ask spreads are extremely small, on the order of fractions of pips for majors (EUR/USD/GBP/JPY/CHF). Even in extremely volatile situations it rarely becomes much larger than a few pips for positions of 1 to 10 Million USD equivalent notional value in the institutional market. Given that retail traders rarely trade that large a position, the FX spot market is essentially very liquid in that respect. The problem is that there are retail brokerages whose business model is to encourage excessive trading in the hopes of capturing that spread, but not guaranteeing that it has enough capital to always meet all client obligations. What does get retail traders in trouble is that most are unaware that they are not actually trading on an exchange like with stocks. Every bid and ask they see on the screen the moment they execute a trade is done against that FX brokerage, and not some other trader in a transparent central limit order book. This has some deep implications. One is the nifty attribute that you rarely pay ""commission"" to do FX trades unlike in stock trading. Why? Because they build that cost into the quotes they give you. In sleepy markets, buyers and sellers cancel out, they just ""capture"" that spread which is the desired outcome when that business model functions well. There are two situations where the brokerage\'s might lose money and capital becomes very important. In extremely volatile markets, every one of their clients may want to sell for some reason, this forces the FX brokers to accumulate a large position in the opposite side that they have to offload. They will trade in the institutional market with other brokerages to net out their positions so that they are as close to flat as possible. In the process, since bid/ask spreads in the institutional market is tighter than within their own brokerage by design, they should still make money while not taking much risk. However, if they are not fast enough, or if they do not have enough capital, the brokerage\'s position might move against them too quickly which may cause them lose all their capital and go belly up. The brokerage is net flat, but there are huge offsetting positions amongst its clients. In the example of the Swiss Franc revaluation in early 2015, a sudden pop of 10-20% would have effectively meant that money in client accounts that were on the wrong side of the trade could not cover those on the other side. When this happens, it is theoretically the brokerage\'s job to close out these positions before it wipes out the value of the client accounts, however it would have been impossible to do so since there were no prices in between the instantaneous pop in which the brokerage could have terminated their client\'s losing positions, and offload the risk in the institutional market. Since it\'s extremely hard to ask for more money than exist in the client accounts, those with strong capital positions simply ate the loss (such as Oanda), those that fared worse went belly up. The irony here is that the more leverage the brokerage gave to their clients, the less money would have been available to cover losses in such an event. Using an example to illustrate: say client A is long 1 contract at $100 and client B is short 1 contract at $100. The brokerage is thus net flat. If the brokerage had given 10:1 leverage, then there would be $10 in each client\'s account. Now instantaneously market moves down $10. Client A loses $10 and client B is up $10. Brokerage simply closes client A\'s position, gives $10 to client B. The brokerage is still long against client B however, so now it has to go into the institutional market to be short 1 contract at $90. The brokerage again is net flat, and no money actually goes in or out of the firm. Had the brokerage given 50:1 leverage however, client A only has $2 in the account. This would cause the brokerage close client A\'s position. The brokerage is still long against client B, but has only $2 and would have to ""eat the loss"" for $8 to honor client B\'s position, and if it could not do that, then it technically became insolvent since it owes more money to its clients than it has in assets. This is exactly the reason there have been regulations in the US to limit the amount of leverage FX brokerages are allowed to offer to clients, to assure the brokerage has enough capital to pay what is owed to clients."', "I'd think that liquidity and speed are prioritized (even over retail brokers and in come cases over PoP) for institutional traders who by default have large positions. When the going gets tough, these guys are out and the small guys - trading through average retail brokers - are the ones left holding the empty bag.", '"First it is worth noting the two sided nature of the contracts (long one currency/short a second) make leverage in currencies over a diverse set of clients generally less of a problem. In equities, since most margin investors are long ""equities"" making it more likely that large margin calls will all be made at the same time. Also, it\'s worth noting that high-frequency traders often highly levered make up a large portion of all volume in all liquid markets ~70% in equity markets for instance. Would you call that grossly artificial? What is that volume number really telling us anyway in that case? The major players holding long-term positions in the FX markets are large banks (non-investment arm), central banks and corporations and unlike equity markets which can nearly slow to a trickle currency markets need to keep trading just for many of those corporations/banks to do business. This kind of depth allows these brokers to even consider offering 400-to-1 leverage. I\'m not suggesting that it is a good idea for these brokers, but the liquidity in currency markets is much deeper than their costumers."']

How dividend payout happens

["You will need to buy a stock before the ex-dividend date to receive the dividends. You can sell a stock on the ex-dividend date or after and you will receive the dividends. So if the ex-dividend date is the 5th August, you need to buy before the 5th and you can sell on the 5th or after, to receive the dividends. Definitions from the ASX: Record date The Record Date is 5.00pm on the date a company closes its share register to determine which shareholders are entitled to receive the current dividend. It is the date where all changes to registration details must be finalised. Ex dividend date The ex dividend date occurs two business days before the company's Record Date. To be entitled to a dividend a shareholder must have purchased the shares before the ex dividend date. If you purchase shares on or after that date, the previous owner of the shares (and not you) is entitled to the dividend. A company's share price may move up as the ex dividend date approaches and then fall after the ex dividend date.", "As the record date is 7th August, you need to hold stocks on the 7th August closing. You need not hold it till 2nd Sept. The list as taken on 7th August would be processed and instructions given to Bank and the dividends credited by 1st Sept. Edit: To Clarify Victor's comment Typically from the time one sells the stocks to the time it actually gets transferred has a clearing cycle. Most stock exchanges have 2 or 3 days cycles. i.e. if I sell the stock today, it is still in my name. The money is still with the buyer. On Day 1, the positions are arrived at. On Day 2 the stock gets credited to the buyer and the funds gets credit to seller. As the question was specific whether to hold the stock till 7th or 22nd Sept, my initial answer was simple. The illustration by Victor is more accurate.", "The ex-dividend date is the first date on which you may sell without losing your dividend. In this case that date is August 5th (thanks, Victor). The price opens on the ex-dividend date lower than it closed on the previous day (by the amount of the dividend). Therefore you may sell any time on August 5th (including during pre-market trading) and still get the dividend. You must be the owner of the stock as of the end of after-hours trading on the 4th (and therefore overnight) in order to get the dividend. Intel's Dividend Dates The record date isn't important to your trading decision."]

ISA - intra year profits and switching process

["You're overthinking it. The ISA limit applies to the amount you invest into the ISA. In your example, £10,000. Whether that then fluctuates with performance is irrelevant. Even if you realise aprofit or a loss, nobody is watching it. You merely count the amount you originally contributed into the ISA wrapper. When they add up to £15,000; that's the limit reached. (And by the way, remember that only money going into the ISA is counted. It doesn't matter if you -let's say - put £15k in, then remove 10k. You've reached the limit. You don't again have the chance to put £10k 'back in'.", "An ISA is a much simpler thing than I suspect you think it is. It is a wrapper or envelope, and the point of it is that HMRC does not care what happens inside the envelope, or even about extractions of funds from the envelope; they only care about insertions of funds into the envelope. It is these insertions that are limited to £15k in a tax year; what happens to the funds once they're inside the envelope is your own business. Some diagrams: Initial investment of £10k. This is an insertion into the envelope and so counts against your £15k/tax year limit. +---------ISA-------+ ----- £10k ---------> | +-------------------+ So now you have this: +---------ISA-------+ | £10k of cash | +-------------------+ Buy fund: +---------ISA-------+ | £10k of ABC | +-------------------+ Fund appreciates. This happens inside the envelope; HMRC don't care: +---------ISA-------+ | £12k of ABC | +-------------------+ Sell fund. This happens inside the envelope; HMRC don't care: +---------ISA-------+ | £12k of cash | +-------------------+ Buy another fund. This happens inside the envelope; HMRC don't care: +---------ISA-----------------+ | £10k of JKL & £2k of cash | +-----------------------------+ Fund appreciates. This happens inside the envelope; HMRC don't care: +---------ISA-----------------+ | £11k of JKL & £2k of cash | +-----------------------------+ Sell fund. This happens inside the envelope; HMRC don't care: +---------ISA-------+ | £13k of cash | +-------------------+ Withdraw funds. This is an extraction from the envelope; HMRC don't care. +---------ISA-------+ <---- £13k --------- | +-------------------+ No capital gains liability, you don't even have to put this on your tax return (if applicable) - your £10k became £13k inside an ISA envelope, so HMRC don't care. Note however that for the rest of that tax year, the most you can insert into an ISA would now be £5k: +---------ISA-------+ ----- £5k ---------> | +-------------------+ even though the ISA is empty. This is because the limit is to the total inserted during the year."]

Why does the calculation for IRR use revenue, not profit?

["The short answer is that you would want to use the net inflow or net outflow, aka profit or loss. In my experience, you've got a couple different uses for IRR and that may be driving the confusion. Pretty much the same formula, but just coming at it from different angles. Thinking about a stock or mutual fund investment, you could project a scenario with an up-front investment (net outflow) in the first period and then positive returns (dividends, then final sale proceeds, each a net inflow) in subsequent periods. This is a model that more closely follows some of the logic you laid out. Thinking about a business project or investment, you tend to see more complicated and less smooth cashflows. For example, you may have a large up-front capital expenditure in the first period, then have net profit (revenue less ongoing maintenance expense), then another large capital outlay, and so on. In both cases you would want to base your analysis on the net inflow or net outflow in each period. It just depends on the complexity of the cashflows trend as to whether you see a straightforward example (initial payment, then ongoing net inflows), or a less straightforward example with both inflows and outflows. One other thing to note - you would only want to include those costs that are applicable to the project. So you would not want to include the cost of overhead that would exist even if you did not undertake the project."]

Sale of house profit gifted to child

["1) You parents will have to pay tax on the gain as it wasn't their primary home. You don’t pay Capital Gains Tax when you sell (or ‘dispose of’) your home if all of the following apply: As I look at it, it is your parents are the ones who own the property and they will have to pay on £60000. But as you say you pay part of the mortgage, I would go to a tax advisor/accountant to confirm if they will only pay on the £15000. I couldn't find any guidance on that matter on gov.uk 2) Inheritance tax will not be levied on it as it is below £325000, but tax will be levied on £325000, less £3000 annual gift allowance. Two articles for further information - GOV.UK's Tax when you sell your home Money.co.UK's Gifting money to your children: FAQs"]

On a debt collection agency's letter, what does “balance” refer to?

['"Without more info to go on (such as a screenshot of the relevant portion of the statement or what country you\'re in), I will run with the answer that ""balance"" is the amount the collection agency is attempting to collect from you, including any and all fees the agency may have added. One important idea to keep in mind is that depending on how old the debt is, the amount involved, and the importance to the agency to collect it, you may be able to negotiate a settlement for less than the full amount. This isn\'t always possible, but sometimes you get lucky, and it doesn\'t hurt to try. Collection agencies work in several ways. Some will actually buy the outstanding debt from the original creditor for some percentage of the debt\'s face value and then take their chances on whether they collect anything at all, while others work on behalf of the creditor and earn some percentage of what they manage to recover. In the latter case, your chance of negotiating a reduced amount is better, because the agency is being evaluated by the creditor on how quickly and efficiently they collect debts. An agency that is slower or less effective than another is less likely to continue earning the creditor\'s business. I hope this helps. Good luck!"', 'The balance is the amount due.']

How can I borrow in order to improve a home I just bought?

['"Be careful that pride is not getting in the way of making a good decision. As it stands now what difference does it make to have 200K worth of debt and a 200K house or 225K of debt and a 250K house? Sure you would have a 25K higher net worth, but is that really important? Some may even argue that such an increase is not real as equity in primary residence might not be a good indication of wealth. While there is nothing wrong with sitting down with a banker, most are likely to see your scheme as dubious. Home improvements rarely have a 100% ROI and almost never have a 200% ROI, I\'d say you\'d be pretty lucky to get a 65% ROI. That is not to say they will deny you. The banks are in the business of lending money, and have the goal of taking as much of your hard earned paycheck as possible. They are always looking to ""sheer the sheep"". Why not take a more systematic approach to improving your home? Save up and pay cash as these don\'t seem to cause significant discomfort. With that size budget and some elbow grease you can probably get these all done in three years. So in three years you\'ll have about 192K in debt and a home worth 250K or more."', "It depends on your equity(assets - liabilities). If you have a lot of equity, banks will be happy to lend you money because they now they can always seize your assets. If you don't have a lot of equity another option is to go to hard money lenders. They charge high rates and some of them lend-to-own, but is an option. And consider what Pete said, you might be a little optimistic."]

What are pros and cons of UK Building Societies compared to banks?

["they may be willing to issue mortgages with smaller deposits, but may take longer to make a decision That cannot be farther from the truth. If you are getting a mortgage on a smaller deposit, you will be paying a higher interest rate. Time to take a decision depends very much on your credit situation, earnings, spending and the amount of loan you want to avail of. advantages and disadvantages compared to banks today Nothing specifically that is obvious. You deposits are guaranteed by FSCS, which is primarily everybody's biggest concern. One thing I did observe was they generally have saving accounts which pay better than the big banks, but that is for one to compare and find out. In ownership structure you own a part of the building society because you are a member by having an account(bank/mortgage) with them. Not the case with a big bank though unless you own any shares. You can make a case for the difference of the big bank's multiple business as compared to a building society."]

Why does my checking/savings account offer a higher interest rate than a standalone savings account?

["The key is that you need to use your debit card to earn the higher interest rate. The bank can offer a higher interest rate on accounts connected with a debit card because: They earn additional income through debit card fees charged towards account holders, among other things. They offer the higher interest rate specifically to encourage people to use their debit cards. By offering a joint checking/savings account that requires you to use your debit card, the bank is assuming that you'll keep more money in your account than you would in a standard checking-only account. Your higher balance translates into more money the bank can loan out or invest, which usually leads to higher profit for them. Businesses pay fees to the bank to accept debit cards. These fees represent another source of profit for the bank. The more you use your debit card, the more the bank earns in fees, so the bank encourages you to use your debit card more frequently through incentives like a higher interest rate or waiving fees on your account if you use your card enough. Plus, since it's likely that an individual who maintains a fairly high balance in an account linked to a debit card is going to spend more (simply because they can spend more), banks will sometimes waive fees on the consumer side for balances over a certain amount."]

Do I need to file taxes jointly with my girlfriend if we live together?

["In Ontario, common law marriage requires 3 years of cohabitation, and doesn't give rights to property (which remains separate). I'd say in your situation you can still file as single, but I'd suggest asking your tax accountant to be sure.", '"If you pay her rent, how do you differ from a tenant in the eyes of the law? I ask this to show that you are in a business relationship first and foremost. If you don\'t want to file jointly, there is nothing compelling about your situation to force it. (Grant you, in most countries, there is a benefit to filing jointly) but here, I would argue it would be difficult to make the case. There are, to the best of my knowledge, no laws barring opposite sex landlord-tenant rental situations. Furthermore, there are no laws barring romantic relationships amongst landlords and tenants. Indeed, you would need to prove your relationship in some fashion for it to even be considered. In establishing a date of separation from my soon-to-be-ex-wife, for example, I merely needed to prove that we were not ""presenting ourselves as husband and wife."" Once I showed that we didn\'t sit together at church and that she was attending parties I wasn\'t, that was sufficient. Proving you are in a relationship is actually a lot harder than proving you\'re not."']

How do credit card payments work? What ensures the retailer charges the right amount?

["When you give your credit card number and authorize a merchant to charge your credit card, the merchant then gives the information to their merchant processor which in turns bills the bank that issued the card (it's a little more complex and it all happens instantly unless the merchant is using the very old fasion imprinting gizmos). It is possible for a merchant to attempt to charge you more than you authorized but if they do they risk a fine ($25-$50 for a chargeback) from their processor, the legitimate portion of the charge as well as increasing the processing fees charged by their processor or even the possibility of loosing their merchant account entirely and being permanently blacklisted by Visa/Mastercard. In short no legitimate business is going to intentionally over charge your credit card. There really isn't significant risk in using a reputable online retailer's order forms. There is the possibility that their database could be compromised but that risk is lower than the risk of having an employee steal your credit number when you give it to them in person. Besides in the US at least the most you can legally be held liable for is $50 assuming you notice the discrepancy within 60 days of statement the charge appears on and most banks limit liability to $0. Over the years I have had a number of different credit card numbers stolen and used fraudulently and I have never had to pay any fraudulent charges.", '"Your credit card limit is nothing more than a simple number. When you purchase something, the merchant receives a number (i.e. the amount of the transaction) from your card company (e.g. Visa) in their bank account, and that number is subtracted from your limit (added to your balance). The amount is recorded, and isn\'t changed, so that\'s how they get the ""exact"" amount you paid. Transferring a number is easier than the retailer having to wait for cash to get from you to your card company to them. Moving numbers around is the basis of the modern financial system. And yes, it is always a risk to let someone else have your credit card number. An untrustworthy company/person may use it to charge you without your permission, or if they have your full details they could use it as if they were you. With a reputable retailer like Amazon, the main risk is data theft: If a security hole is found in Amazon\'s system, someone could steal your credit card info and misuse it."']

What's the general principle behind choosing saving vs. paying off debt?

["It has to do with return. I don't know if Canada has a matching feature on retirement accounts, but in the US many companies will match the first X% you put in. So for me, my first $5000 or so is matched 100%. I'll take that match over paying down any debt. Beyond that, of course it's a simple matter of rate of return. Why save in the bank at 2% when you owe at 10-18%? One can make this as simple or convoluted as they like. My mortgage is a tax deduction so my 5% mortgage costs me 3.6%. I've continued to invest rather than pay the mortgage too early, as my retirement account is with pre-tax dollars. So $72 will put $100 in that account. Even in this last decade, bad as it was, I got more than 3.6% return.", 'Debt creates risk. Plain and simple. Comparing interest rates of debt vs. possible investing. To me, it is all meaningless. When you are in debt, you options are limited. If you are not in debt, you have more freedom. To me, it is a no brainer. Become debt free ASAP.', '"Think of yourself as a business with two accounts, ""cash"" and ""net worth"". Your goal is to make money. ""Cash"" is what you need to meet your obligations. You need to pay your rent/mortgage, utilities, buy food, pay for transportation, service debt, etc. If you make $100 a month, and your obligations are $90, you\'re clearing $10. ""Net worth"" are assets that you own, including cash, retirement savings, investments, or even tangible goods like real property or items you collect with value. The ""pay off debt"" versus ""save money"" debate, in my opinion, is driven by two things, in this order: If you start saving too soon, you\'ll have a hard time getting by when your car suddenly needs a $500 repair or you need a new furnace. You need to improve your cash flow so that you actually have discretionary income. Pay off those credit cards, then start directing those old payments into savings and investments."', "Depends upon the debt cost. Assuming it is consumer debt or credit card debt, it is better to pay that off first, it is the best investment you can make. Let's say it is credit card debt. If you pay 18% interst and have for example a $1,000 amount. If you pay it off you save $180 in interest ($1,000 times 18%). You would have to earn 18% on 1,000 to generate $180 if it was in aninvestment. Here is a link discussing ways of reducing debt Once you have debt paid off you have the cashflow to begin building wealth. The key is in the cashflow."]

Can used books bought off Amazon be claimed as a tax deduction in Australia?

['"VAT = Value Added Tax (as an Aussie think ""GST"") This is applicable in Britain. Basically, if you were in Britain, and if you could claim VAT as a deduction, that invoice is not sufficient proof to make the claim. But you\'re in Oz so it doesn\'t apply to you in any case. For work-related deductions like book purchases, see http://www.ato.gov.au/individuals/content.asp?doc=/content/00216829.htm&pc=001/002/068/001/002&mnu=&mfp=&st=&cy=1 Issues such as the books being second hand or purchased online are not cited in the instructions as relevant/limiting factors. In fact, if you really want to get into the nitty gritty, you could claim the work-related proportion of your internet access fees as a deduction (question D5 instructions, above, cover that as well)."', "Yes, you can. That the books were purchased from abroad is irrelevant: you incurred an expense in the course of earning your income. If the books are expensive (>$300 per set iirc) you will need to deprecate them over a reasonable life time rather than claiming the entire amount up front. It doesn't matter whether what you got was a VAT Invoice; as long as you have some reasonable documentation of the expense you're ok.", "Yes, if they meet the ATO's criteria. Books, periodicals and digital information If the item cost less than $300 you can claim an immediate deduction where it satisfies all of the following requirements: http://www.ato.gov.au/Individuals/Income-and-deductions/Deductions-you-can-claim/Other-deductions/Books,-periodicals-and-digital-information/ Alternatively They may be a self-education expense http://www.ato.gov.au/Individuals/Income-and-deductions/Deductions-you-can-claim/Self-education-expenses/ A Further Alternative They could fall into the tool, equipment or other asset category if they are for a professional library (this can include a home office). http://www.ato.gov.au/Individuals/Income-and-deductions/Deductions-you-can-claim/Tools,-equipment-and-other-assets/ I understand this is an old question although given the dead link in the above answer and the new resources this answer might prove helpful for others coming across this question."]

privacy concerns when receiving money from paypal from strangers?

["You'll need to check PayPal's terms of service for that first question. I would imagine you could, as my wife and I both have personal PayPal accounts listed at the same address. When you receive money, the senders will only see the (full) name on your account, the amount, and the transaction ID. If you set up a business account, the name on your account will be replaced with the company name. Your mailing address will not be made visible. Yes, PayPal provides an export option of your transaction history. For reference: If your volume greater than $20,000 across 200 or more transactions, then they'll be issuing a 1099-K form, anyway. That depends on the payment method. Bank transfers are instant, where cards require a settlement delay. PayPal provides buyer protection, so I'd be very dutiful in logging all of your work done to provide proof of completion, in case someone disputes a payment. Disputes can take place up to 45 days from the date of the transaction. Chargebacks can take place 120 days or more after the transaction (depends on the card network)."]

Health insurance lapsed due to employer fraud. How to get medications while in transition?

['Check with the manufacturer of the name brand medication. Most of them have programs to help people who need their medication but can not afford it. They may be able to send you coupons for discounted or free medication. You can go to a free clinic. If your income is low enough the free clinic will provide medicine until you can get back on insurance. You can do what alot of people who work hard and do not have insurance do and pay for it outof pocket. You can talk to your doctor and see if there is an alternative to the expensive medicine that your insurance used to pay for. It may not be as effective or may have other side affects but many people are forced to go with these alternatives. You situation is certianly unfortunate but also not terribly uncommon. You probably also have recourse against the former employer but if they commited fraud, and faked your insurance there probably is not alot of money to recoup. If it was a person who commited fraud then you may be able to get a judgement against them that would survive bankruptcy and the business but it will probably be at least 5 years before you can recoup anything possibly much longer and your attorney will probably not take it on contingency.', 'Your doctor may also have free samples available. You could call, explain your situtation and ask to see if they have any free samples.']

In what circumstances will a bank waive the annual credit card fee?

["See if the bank has other credit cards they offer. Many banks have multiple ones: some cards have great benefits, others do not; some cards have high rates, some do not; some cards are secured, some do not. If they have a card that you like ask them to switch you to the card you want. They should be able to do so very easily. Your card number will change, but they will treat it is a replacement so that your credit score will not take a hit during the switch. It may be possible to get them to waive the annual fee, but most won't because each card type they offer are separate products so they only allow you to pick one of their options. If they don't have a card to your liking apply for a card from anther bank that has the benefits and annual fees (zero) that you are looking for. It may be that the new card will start with a lower limit, but it will increase over time, especially as you shift more of your business to the new card. When you cancel the old card before the next year rolls around you will take a small short hit to your credit score, but that is ok."]

How to calculate cash loss over time?

['If inflation is at 2% per annum, in a year you would need £102 to buy equivalent goods to what you could buy today. So if you keep your money in a drawer the buying power of your £100 in a year will be only 100/102 = 98.039% of what it is currently.', "While it is a true loss, as you've determined, is not a cash cost, per se. A cash cost would be a decrease in cash holdings. Inflation does not take your cash balance; it devalues it, so it is an accrued loss. Central banks are extremely lazy in determining inflation, so the highest resolution available at a public level is monthly. In the United States, there is a small project that tries to calculate daily inflation rates and seems to do a decent job, but unless if you are a customer of a particular financial institution, you will suffer a lag. The small project refuses to make the data public in real time or even allow outside analysis. In the UK, the Office for National Statistics is responsible for consumer inflation statistics. The methodology is not readily available, but considering the name, it is most likely an inferior Laspeyres index instead of the optimal Fisher index as it is in the US. To calculate the accrued cost due to inflation, simply multiply the amount of money held by the price index value at the beginning of the time held and divide by the price index value at the end of the time held. For example, to determine the amount of value lost since March 2014, multiply the money held by the price index value for March 2014 and divide by June 2014.", "It helps to put the numbers in terms of an asset. Say a bottle of wine costs 10 dollars, but the price rises to 20 dollars a year later. The price has risen 100%, and your dollars have lost value. Whereas your ten used to be worth 100% of the price of bottle of wine, they now are worth 50% of the risen price of a bottle of wine so they've lost around 50% of their value. Divide the old price by the new inflated price to measure proportionally how much the old price is of the new price. 10 divided by 20 is 1/2 or .50 or 50%. You can then subtract the old price from the new in proportional terms to find how much value you've lost. 1 minus 1/2 or 1.00 minus .50 or 100% minus 50%.", "There are two things you need to keep in mind when you look at Inflation as an entity. Inflation is necessary to keep in check the value of goods. As per Moore's Law for example, a mobile phone that you buy for £100 today will be available for £50 in two years. With increased purchasing power, one needs to maintain balance between the purchasing power and its value. If you think about the 'loss' at a rate of 2% you would have £96.04 (in terms of today's value) in two years. But if you looked at the same cell phone as leverage for your business where it allowed you to do work and earn £1000 in two years - the investment would clearly offset the cost of inflation. Inflation is incentive for people to spend their money. If you for example spent all of your £100 today, it is £100 income for someone else. He has further incentive to spend it creating a chain of transactions. In theory while this is a true mathematical loss, the increasing purchasing power helps you leverage your financial asset to get a return on your investment."]

How to realize capital gains before going from non-resident alien to resident alien in USA

["Is this possible and will it have the intended effect? From the US tax perspective, it most definitely is and will. Is my plan not very similar to Wash Sale? Yes, except that wash sale rules apply for losses, not gains. In any case, since you're not a US tax resident, the US wash sale rules won't apply to you.", "This will work as intended, but there's another point to consider. In the US, the tax rate on proceeds from stock sales is higher for short term holdings, which are defined as held for less than one year. Both rates vary based on your income. Bracket numbers are for fiscal year 2014, filing as single. The difference between short and long term capital gains tax in the US is a minimum of ten percentage points, and works out to 15 percentage points on average. This is substantial. If you won't be reporting much income the year you move to the US (say because you only worked for a portion of the year) it is decidedly to your advantage to wait and sell the stocks in the US, to get that sweet 0% rate. At a minimum, you should hold the position for a year if you sell and rebuy, from a tax optimization perspective. Two caveats:"]

No-line-of-credit debit card?

["This arrangement might be a bit of a pain, but what about Visa gift card(s)? The transfer of money just doesn't happen if the money isn't already on the card. See here.", 'We have a pre-paid mastercard. This will only allow the spending up to the amount already paid into the card account. Visa Electron is a bank account linked debit card that will not allow the account to go overdrawn but this card type is getting quite rare.', '"I think what you are looking for is a secured credit card. They are mostly used by people who have ruined their credit and want to rebuild it, but it might also serve your purpose. Essentially you deposit some money in an account and the credit card can be used up to the amount left in the account. Each month when you pay the bill, it resets the balance that you can charge. Also, many credit card providers also offer ""disposable"" or ""one use"" credit card numbers for the express purpose of using it online. It still gets charged against your regular account, but you get a separate number that can only be used for up to X dollars of transactions."', "Having worked at a financial institution, this is a somewhat simple, two-part solution. 1) The lendor/vendor/financial institution simply turns off the overdraft protection in all its forms. If no funds are available at a pin-presented transaction, the payment is simply declined. No fee, no overdraft, no mess. 2) This sticking point for a recurring transaction, is that merchants such as Netflix, Gold's Gym etc, CHOOSE to allow payments like this, BECAUSE they are assured they are going to get paid by the financial institution. It prevents them from having issues. Only a gift card will not cost you more money than you put in, BUT I know of several institutions, that too many non-payment periods can cause them to cease doing business with you in the future. TL:DR/IMO If you don't want to pay more than you have, gift cards are the way to go. You can re-charge them whenever you choose, and should you run into a problem, simply buy a new card and start over."]

Do classes have to pay sales tax on materials used?

['"In most jurisdictions, both the goods (raw materials) and the service (class) are being ""sold"" to the customer, who is the end user and thus the sale is subject to sales tax. So, when your friend charges for the class, that $100 is subject to all applicable sales taxes for the jurisdiction and all parent jurisdictions (usually city, county and state). The teacher should not have to pay sales tax when they buy the flowers from the wholesaler; most jurisdictions charge sales tax on end-user purchases only. However, they are required to have some proof of sales tax exemption for the purchase, which normally comes part and parcel with the DBA or other business entity registration paperwork in most cities/states. Wholesalers deal with non-end-user sales (exempt from sales tax) all the time, but your average Michael\'s or Hobby Lobby may not be able to deal with this and may have to charge your friend the sales tax at POS. Depending on the jurisdiction, if this happens, your friend may be able to reduce the amount the customer is paying that is subject to sales tax by the pre-tax value of the materials the customer has paid for, which your friend already paid the tax on."']

Why are interbank payment (settlement) systems closed for weekends and holidays?

['"The second part of your question is the easiest to answer, how much manual work is involved in settlement processes? Payment systems which handle low value (i.e. high volume) transactions work on the basis of net settlement. Each of the individual payments are netted across all of the participant banks, so that only one ""real"" payment is made by each bank. Some days banks will receive money, others they will pay money. This is arbitrary and depends on whether their outbound payments exceed their inbound payments for that day. The payment system will notify each Bank how much it owes/will receive for the day. The money is then transferred between all of the banks simultaneously by the payment system to remove the risk that some pay and others don\'t. If you\'re going to make or receive a very large payment, you\'re going to want to make certain that its correct. This means that if there\'s a discrepancy, you need operations people available to find out why its wrong. When dealing with this many payments, answering that question can be hard. Did we miss a payment? Is there a duplicate? Etc. The vast majority of payments will process without any human involvement, but to make the process work, you always need human brains there to fix problems that occur. This brings me to your first question. On every day that settlement happens, a bank will receive (or pay) a very large sum of money. As a settlement bank you must settle that money - the guarantee that every bank will pay is one of the main reasons these systems exist. For settlement to happen, every bank has to agree to participate, and be ready to verify the data on their side and deliver the funds from their account. So there is no particular reason that this doesn\'t happen on weekends and holidays other than history. But for any payment system to change, it would require the support of (at least) a majority of participants to pay staff to manage the settlement process on weekends. This would increase costs for banks, but the benefits would only really be for you and me (if at all). That means it\'s unlikely to happen unless a government forces the issue."', 'TARGET2 is a high value realtime settlement system across Europe and for this to be open on weekends would mean all the Banks including Central Banks in the Euro Zone work. Quite a few times to manage intra day liquidity, banks borrow from each other, hence there is an active monitering of the liquidity by Banks. The borrowing happens over phone and fax and the lending bank sending a high value transaction that credits the borrowing banks. These is the day to day job of treasury group [highly paid individuals] to manage liquidity. Now if on weekends the volume is less, it does not make sense to keep these people, the cost of supporting this for very insiginificant business gain is not driving to build such systems. On the other hand on retail transactions, say Cards [Debit / Credit], ATM, the value is not high and hence there is no treasury function involved and there is a huge need, everything is automated. So no issues.']

Working as a freelancer overseas, but US Citizen, what is my tax situation?

["This person must pay taxes in both the overseas country and in the U.S. This is unusual; generally, only the U.S. demands this. Depending on the specific country, he would likely not be taxed twice as the U.S. generally recognises tax paid in a different country. Note there are some gotchas, though. For example, although Canada has a generally higher tax scheme than the U.S., you may still end up owing tax if you use the Tax-Free Savings Account system in Canada, as that is not recognised in the U.S. As to whether or not this person should form a company, that is far too broad a question. It's going to depend in large part on the tax situations of the countries involved. This person needs to consult an accountant specialising in this situation. That is, on personal versus business tax and on tax involving U.S. citizens. Yes, this person can and indeed must file and pay taxes in the U.S., from outside the U.S."]

Are stock prices likely drop off a little bit on a given friday afternoon?

["It is called the Monday Effect or the Weekend Effect. There are a number of similar theories including the October Effect and January Effect. It's all pretty much bunk. If there were any truth to traders would be all over it and the resulting market forces would wipe it out. Personally, I think all technical analysis has very little value other than to fuel conversations at dinner parties about investments. You might also consider reading about Market efficiency to see further discussion about why technical approaches like this might, but probably don't work.", "There are classes of 'traders' who close their positions out every evening, not just on fridays. But their are other types of businesses who trade shortly before or nearly right at market close with both buys and sells There are lots of theories as to how the market behaves at various times of day, days of the week, months of the year. There are some few patterns that can emerge but in general they don't provide a lot of 'lift' above pure random chance, enough so that if you 'bet' on one of these your chances of being wrong are only very slightly different from being right, enough so that it's not really fair to call any of them a 'sure thing'. And since these events are often fairly widely spaced, it's difficult to play them often enough to get the 'law of large numbers' on your side (as opposed to say card-counting at a blackjack table) which basically makes betting on them not much different from gambling"]