Sorry, You Didn’t Win the African National Lottery After All

When it comes to the possibility of getting something for nothing, a lot of people tend to simply divorce reality. They like the possibility that they could be getting a substantial amount of free money so much that they don’t take the time to consider what the motives of the people who might potentially be giving them money are or even if they will ever actually see any of this money. One of the ways this most commonly shows up is through a variant of the classic Nigerian 419 scam and involves an alleged foreign lottery, and somehow you’re the winner. If you try to collect your ‘lottery winnings’, be prepared to go for a ride.

Here’s how it works. One day you check your email and find an unsolicited message from someone in a foreign country telling you that you (or your email address) have won in a foreign lottery that you’ve never entered. The prize money is usually quite substantial, often several million dollars. The tone of the email will be very up-beat, but often using poor grammar and spelling since the person who wrote it probably does not have English as their native tongue. They will then tell you that you should contact them right away in order to collect your winnings.

If you were to contact them back, they would probably ask for a significant amount of personal information such as names, addresses, phone numbers, and most importantly, the account and routing numbers for your checking and savings accounts so that they can ‘transfer’ your ‘lottery winnings’ into your account. This is where the scam comes in. They’ll take your personal information and use that to transfer as much money as they can out of your account under the guise of being a legitimate merchant. After they get the money from your account, you’ll never hear from them again. You will also have a very hard time getting this money back from the bank; you might be able to it in a few rare occasions, but most of the time you’re just out of luck.
There’s another variant of the scam where they’ll send you a cashier’s check and tell you to deposit it and wire them or mail them a fraction of the amount back to pay for some sort of alleged taxes or fees. In this case the cashier’s check is fraudulent, but the bank will tell you that it’s a real check and it will be several months before you find out that the check was invalid. There’s no real security for cashier’s checks in the banking industry, and even some of most authentic looking cashier’s checks could be fraudulent.

There’s an old phrase we all learned when we were young, and that if it sounds too good to be true, it probably is. There are no legitimate foreign lotteries or sweepstakes that you will ever win, especially if you didn’t enter them! If you try to claim your prize money, be prepared to get scammed.

What To Do When You’ve Got Piles of Payday Loans and It Seems There’s No Way Out

When most of us find ourselves in a place where we just don’t have enough money to pay for things, we immediately turn to borrowed money. The reason for this is that we don’t want to face any interruption in our lifestyle, so we subconsciously do what we need to do to make the money show up. This might mean selling some stuff, working extra hours, but often it just means borrowing money. Some people use credit cards, others go to the pawn-shop and some people get themselves stuck in payday loans. If you find yourself in a situation where you have a number of PayDay loans it seems that the light at the end of the tunnel has been shut-off, don’t worry, there’s help.

We must first remember that debt is not the problem itself, but rather the symptom of over-spending. Why are you spending more money than you make? Is it because you lost your job and just don’t have any income? Do you just not make enough to get by with the basic necessities of life? Perhaps you just enjoy spending money and can’t seem to stop yourself from spending more than you make. You first have to alleviate whatever is causing this imbalance. It might mean job-hunting like there’s no tomorrow, it might mean picking up a part-time job, or it might just mean getting yourself on a really tight budget, but you have to put yourself in a place where you are making more than you spend on a monthly basis.

After you’ve tipped the balance of power in your income and expenses, we can start to work off those debts. Since payday loans are so much higher in interest rates than credit cards and other debts, they should be your priority after paying for some basic groceries, your utility bill, your mortgage and some gasoline for your car. To get out of them, you have to attack them like they’re the plague, take every extra dime you can have and throw it at your loans. Start with the smallest one, and pay as much on it as you can as possible, and work your way up this list. You might want to have a garage sale, take some money out of your investments if you have any, or perhaps sell some stuff on eBay to free up extra money to help clear the log jam. The point is, make them the priority in your life after taking care of basic necessities and fight to get rid of them like there’s no tomorrow.

Sick of Credit Card Debt? Pay it Off in 1/4th The Time. (No Crazy Schemes, Just Math.)

Credit card is amazingly easy to get into and almost seemingly impossible to get out of. When we’re young we naively get a credit card in hopes of building our credit, purchase a few things here and there with the best intentions of paying off our balance at the end of the month. We end up charging more and more because we like our new found purchasing power and really don’t consider the debt that we’re building up. Before we know it, we have thousands of dollars in credit card debt and it seems that the light at the end of the tunnel has been shut off. Fortunately, there’s hope to be had. You can pay off your credit card debt in a 4th the time you normally would.

The problem with credit card debt is compound interest. With many credit cards you will be paying anywhere from 19% to 29% in interest, this will take you to the cleaners financially if you let it. Most of your payment will be going toward the interest and very little of it will be going toward your principal balance making it take seemingly forever to pay off your debt. Since most people are paying minimum payments or close to it on their credit card debt, it will often take them decades to get out of their credit card debt.

If you want to say goodbye to the balance on your Visa once and for all, the first thing you have to do is stop borrowing on it. You’ll never pay it off if you keep charging things up on it. Cut it up, or put it in water and freeze it so that you’ll not be tempted to use the card again. If you send in $100 a month on a credit card debt, change it so that you pay $50 every 14 days on your credit card. This is called the Eisenson method, essentially it will make it so that you’re paying extra payments without even realizing it. Over the course of the year, you’ll end up paying two extra payments which will go completely toward the principal balance of the credit card.

It’s shocking how fast you can get out of debt using this method to pay off your credit cards. Since the interest rates are so high on your debt, paying down extra on the principal will dramatically reduce the amount of interest you pay, in fact you’ll likely be able to get out of your credit card debt in 1/4th the time that it normally would.

Worried About the Real Estate Slump? Don’t Panic.

If you turn on any of the sensationalist news channels, chances are it won’t take long to hear a story about some poor family who signed up for an interest-only variable rate mortgage for a home they couldn’t afford in the first place and were absolutely shocked when the rate and their monthly payments adjusted upwards and now can’t sell their home. For people who made bad decisions and bought homes they couldn’t afford with rip-off mortgages, this real estate slump is probably going to be pretty painful, but for the rest of us, we have nothing to worry about.

The number home homes sitting on the open market waiting to be sold jumped over 50% in the last 12 months, leaving many home-owners who want to sell wonder if they will ever be able to sell their home. You’re not out of luck if you want to sell your home, it can be done; it just might take a little bit of extra work. You need to make sure the price you are charging is based on what the home will actually sell for in the open market, not what you think it should be worth, or what you would like to get for it. You also need to make sure that your home is in the best shape it can be and is as clean as possible. If there are any problems with your home, take care of them. Somebody’s going to buy a house in your area sometime in the next few months; you just have to make sure it’s yours and not somebody else’s.

Many parts of the country are largely unaffected by the real estate bubble. If you live on one of the coasts, Washington DC, or in Florida, chances are the home prices in your area have been somewhat affected in the last year, but there are many parts of the country where a bubble in real estate just never really occurred. For example, South Dakota has the lowest number of sub-prime mortgages per capita in the nation, and home prices have actually been slightly on the up-tick for the last few years.

If you’re living in a home and have no plans of moving in the next few years, you will be wholly unaffected by the real estate slump. Chances are your homes’ value has shot up every year from 2002 to at least 2006 and is worth quite a bit more than when you originally paid for it. The price of your home might have recessed to 2003 prices, but it’s still likely worth more than you paid for it. And if you don’t have any plans to move or sell your home in the near future, you’ll have plenty of time for the real estate market to make a correction and even out again while you keep living in your home, doing your own thing, and making your monthly mortgage payment.

Why the US Dollar’s Decline Isn’t All Bad

In the last few months there has been a lot of discussion in the financial markets about the declining value of the US dollar compared to other world currencies. Yesterday there was a big story that made the rounds about how the US Dollar has hit a 26-year low against the British Pound. Many countries are starting to use their own and other currencies instead of ours because of the dollar’s declining value, and some financial analysts have negative outlooks for the US economy because of that fact. There’s a completely other side of the story that most of the financial media isn’t talking about though. There are actually plenty of benefits of having a weak dollar.

On a macroeconomic scale, American produced goods are essentially on-sale to the rest of the countries in the world. American companies receive the same amount of dollars for each good produced, but the people paying in foreign currencies are paying a lot less in their local currency for our products. Since our products are costing them a lot less than they used to, foreign consumers are more likely to purchase American produced goods. This mean that retail sales will increase for companies with a lot of foreign customers, and the amount of exports or nation has will increase as well, thus lessening the trade deficit.

There are benefits to those of us who do business with companies in other countries as well. For example, let’s say I have an advertiser based in Britain that’s paying me 100 GBP a month to run their advertisements. Right now I get about $210 in American Dollars for that 100 GBP they send me each month. When the dollar was much stronger, I might only receive $100 in American Dollars for each 100 GBP they send over, so as far as I as a business owner am concerned, I’m getting free money each month to reinvest in the business. This is true for just about anyone with customers overseas. Not only will their general volume of sales increase, but the conversion ratio will mean they get a lot more American Dollars than they would have before.

On a long term scale, having a dollar that’s worth dramatically less than other major world currencies will certainly have some very major negative effects for the American financial markets, but so far that just hasn’t happened yet. Those forecasting an extremely negative outlook on the economy are a bit hasty; so far the dollar has only been dropping for a few years, hardly a long-term macroeconomic trend. In fact, there are actually many benefits of having a weak dollar for a certain amount of time.

Is Lending Money on Prosper.com Competitive With Other Investments?

When most of us loan money to our friends, we give them $20 or $30, and they pay us back a week or two later and we think nothing of it. If the person was willing to pay a little bit in interest, you could make a little bit of money off the deal. Now what if you took the money in your savings account repeated this process this process hundreds of times to different friends around the world? This is exactly what Prosper.com is allowing people with money to do, and many people are making it part of their investment portfolios. The question arises, how does lending money through Prosper.com compare to other investments such as mutual funds, real estate, and simple savings. Let’s find out.

We know that one of the most important factors in an investment is risk. You could go down to Las Vegas, play roulette at one of its many casinos, and put your entire life savings on black. It would provide a 100% rate of return on your investment if you won, but nobody does that because it involves far too much risk. When you factor in risk, it’s just not worth it. The same is true for other investments. You might have the option to invest in some hot new tech company that could potentially double or triple your money, but you might not do it because it’s a very risky venture.

Prosper.com recently launched “portfolio plans” which automatically fund loans for you and will give you a better idea of what kind of money you might make after adjusting for non-payment by borrowers and service fees. With their balanced plan, you’ll make about 13.5% interest on the money you invest. When you adjust for risk and the servicing costs, that number ends up being 9.14%.

The rate of return you’ll get through Prosper is very comparable to what you might find when investing in a mutual fund. There are hundreds of mutual funds which will earn you anywhere from 9% to 13% year over year over a long period of time. Does this mean the investments are equal? Not exactly, you still have to consider the tax consequences of both options. If you invested $1000 in a mutual fund and earned 10% on it in one year, you would have to pay a capital gains tax of 15% of the amount of money that you gained, so you would pay 15% of $100 which ends up being $15.00. If you loaned $1,000 on prosper and earned 10% on it in on year, you would have to pay your full tax rate plus the self employment tax. Depending on you tax rate, you could be paying upwards of 30-35% when all is said and done. So instead of sending $15.00 to the government, you’re sending over twice that!

Currently Prosper.com has no options which allow you to invest money into loans through any sort of tax-beneficial retirement account, so you’re stuck paying your ordinary income tax rate on any money that you earn. It might look the same when it comes to interest rates, but when considering the investments holistically, there’s just no comparison.

Prosper.com might not be able to beat out a typical mutual fund in terms of investment, but it is several steps ahead of a savings account at an online bank such as ING Direct or HSBC Direct. You’ll only earn around 4.5% APY on your money at these places, but you know that your money is guaranteed. If you invest in conservative loans on Propser.com, you can still almost get twice that after factoring in fees and lost funds due to non-payment and have a relatively secure investment.

The only problem with that is that the money you put in Prosper.com is not liquid. You won’t get your full amount back plus the interest until the loan is paid off 3 years down the road. Prosper.com appears to be planning a means for lenders to sell their loans to other lenders based on a recent FCC filing, but that’s a bit down the road yet.

Prosper.com certainly won’t replace stocks, real estate and mutual funds that you are using to save for retirement, but it will provide a bit better rate of return than a traditional savings account.

Why College is The Best Time to Start Your Own Business

Many of us have the entrepreneurial spirit deep inside of us yearning to do our own thing and start our own business, but a lot of us never get around to taking the leap because we have a job and think we need to quit it to devote ourselves to our business, or we have families that we have to provide for. Fortunately, there’s a four-to-five year period in our lives when we don’t have these obligations and have everything we need to start a business—it’s called college.

A lot of people live under the false notion that when someone attends college, they have to fully devote themselves to it and won’t have time for anything else. This is simply not the case even if you go to one of the tougher schools. You’re in class for all of 15 hours a week, and do maybe another 10 hours of studying and homework. You’ll have all sorts of free time to pursue your own interests. Most college students use this time to drink, socialize, or play ultimate Frisbee, but that doesn’t have to be you. You can use this time to get a jump on live, get involved, and even start your own business.

College can be an ideal time to start a business because your finances are probably still paid largely by your parents or through a scholarship, so you really don’t have to worry about making a ton of money right away. You will also have the resources of your university at your disposal. Chances are there are a number of business professors that would jump at the chance to help a budding entrepreneur. Some colleges, such as Dakota State University, even offer office space and funding opportunities for students who are interested in starting their own business!

If you’re majoring in anything related to business, you’ll be learning a lot about business as you go through your classes. You’ll be able to practically apply what you’ve picked up in your classes and have real world experience. Even if your business doesn’t succeed, showing that you have a strong sense for business and are willing to go out and try something is definitely something that potential employers will praise and look for.

Should you start a business and have it be relatively successful to the point that it could be your full-time job after you graduate, you’re set. You can keep working and growing your business and don’t have to consider a full-time job. If you need employees, chances are there are thousands of college students at your disposal to hire! You’ll have plenty of connections to professors and students and have no shortage of talent if you need it!

College is the perfect time to start your own business no matter how you put it. You’ve got plenty of free time, very few expenses, and plenty of resources at your disposal!

Applebees, Ruby Tuesday and Chilli’s are Less Healthy than McDonalds

After the release of the documentary Super Size Me, there was not a shadow of a doubt in our nation’s collective minds that the food we eat from McDonalds on a weekly basis was any bit healthy. We spend a lot of time demonizing fast food restaurants for the unhealthy products we voluntarily purchase from them, but did you know there is are restaurants that are much less healthy for you than the major chain fast food restaurants? It turns out that many of our nation’s upscale restaurants, places such as Applebees and Chilli’s are actually a lot less healthy for you than if you were to go down to McDonalds and get your favorite meal.

Our nation’s finer eateries are much less healthy for us because they offer such substantial portions, often well more than any of us should reasonably eat for one meal. At McDonalds if you order a hamburger and fries, you’ll eat a combined 630 calories. If you go to Ruby Tuesday and order their “Ruby’s Classic Burger” and a side of fries, you’ll eat a whopping 1,372 calories! If you go to Chilli’s and order their “Oldtimer Burger” and an order of fries, you’ll be taking in 1,320 calories!

Applebees doesn’t even post their nutritional facts on their website for their regular menu. Their website claims that having so many locations and vendors would make it “extremely difficult to obtain nutritional information on our items.” It seems that all of the other major restaurants in this country were able to come up with reasonable estimates of how many calories are in their food, what makes it so much more difficult for Applebees to provide this data? Is it perhaps that their regular menu items might not be very healthy at all?

We expect burgers and fries not to be healthy for us, but what about things such as pasta’s and salads? It turns out that Ruby Tuesday’s Carolina Chicken Salad contains a whopping 1022 calories and their Club House Salad has 896 calories, and that’s without any dressing. Throw some ranch one on of those and you’re easily adding 100 additional calories. Chili’s “Crispy Chicken Salad” comes in at a 810 calories and their “Grilled Chicken Caesar Salad with dressing” comes in at 1,010 calories!

Eating out at these major chain restaurants is just not healthy any way you put it. Fortunately there are a few things you can do to make it a bit healthier. Consider only eating half of your meal and taking the rest home with you for lunch the next day. This will spread out the calories over two meals rather than gorging yourself at one sitting. You could also split a meal with the person you’re going to eat with. It will cut your bill in half and get rid of a lot of the calories. You can skip on the Soda or any other beverage besides water, that’ll save you $1.50 off your bill and save you a few hundred calories.

How to Get Your Family Prepared in The Event of a House Fire

Most of us had all sorts of fire-safety instruction when we were in grade-school and middle school. The nice fireman would come and visit, show us some cool equipment, and demonstrate how to stop, drop and roll. We’d have occasional fire-drills which meant an extra recess during the day and occasionally watch a fire-safety video. After some initial instruction in grade-school, very few of us ever think about fire-safety again, but the reality is that there are thousands house fires in the United States each year and we need to make sure we’re prepared in the unlikely event a fire does occur. Here’s what to do to make sure your family is ready.

Have a Plan. Make sure you know exactly how you and your children are going to get out of your home in the event of a fire. Have at least two escape routes for each family member from their bedroom. Know who’s going to call the fire-department, what to do about pets, where the children should go, and just about anything else you can think of.

Know Your Fire Extinguisher – If you have a fire-extinguisher, it’s definitely a valuable tool. You can use it to put out small fires, but they have limitations. You’ll get 15-20 seconds of pressure out of them and be able to put out a fire the size of an oven, but not much more. Always remember to shoot at the base of the fire to have the best change of putting it out.

Have Home Fire Drills. If you have young children, under the age of 15, have fire drills twice a year to keep yourself alert. It’ll be a good chance to remind children how they’re supposed to get out in the event of a fire and make sure that everyone is prepared.

Get Smoke Detectors, Lots of Them. Most modern building codes call for a smoke detector in each room of the house. Make sure that you have plenty of smoke detectors around so that you know when a fire does occur. You should have two or three in every level of your home if not more. Check the batteries every two months and make sure they’re working properly.

If you have 2nd Story Bedrooms… - It can be a lot harder to get out of a home when you have more than one story. If you only have one stair well, you should consider coming up with some sort of rope-ladder system to get out a second story window in the event of a fire.

Need Information? Don’t Pay a Dime for 411 Service Ever Again

We all make the occasional trip and find ourselves in a location we’re unfamiliar with. Sometimes we just don’t know where the local eating establishments, shopping cents and entertainment locales are at. Unless you’ve got an iPhone or another cell-phone with a web-browser, sometimes old fashioned directory assistance is the only way to get information about local businesses and organizations. Traditionally we’ve just had to suck it up and pay $1.00 or $2.00 to get the information that we want, but now we’re off the hook! There are a number of free directory assistance numbers that you can all that work nationwide meaning you never have to pay another dime for 411 service.

One service that has been around for a while is 1-800-FREE-411, which you can call, you’ll hear a 30 second advertisement, and then be able to specify what information you want. It works quite well, but there’s actually a service in which you don’t even have to listen to advertisements! Google has launched its own completely free 411 service for business listings. You can give it a try by calling 1-800-GOOG-411. It’s a great way to order pizza or get the phone number for a local business if yu don’t know it off the top of your head.

If you’ve got an internet connection wherever you’re at, usually you can just find a phone number online by going to a website such as WhitePages.com. You can also find local businesses by making use of the Google Maps service. Bring up your city on Google Maps and type in the word “Restaurant,” you’ll see just about every place there is to eat near you. This is a great tool to use when you’re off in the world and need to find a place to eat, shop, or get any other services!

Paid directory assistance is a thing of the past. There are two great free services that will provide you the same information for literally nothing, and if the internet’s available to you when you’re off in the world, you don’t even need to make a phone call.