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Category Archives: Finance

Handle Your Finances

Financial advisors suggest all individuals follow these six basic key principles for financial planning.

• Analyse your current financial status: To be able to plan for future you should first be very confident about your current financial position. Make a checklist of all the assets and liabilities and your income and expenditure. Having this information at hand, you would be in a clear position to understand how you can achieve your financial goals. Your total financial worth would help you to determine the ways to accomplish your set goals, which include paying for your children’s education, buying a new property or being ready for any financial emergency like the loss of a job.

• Chalk out your financial goals: In order to accumulate wealth, a lot of planning has to be done in order to achieve the desired goals. Setting goals would give you an urge to go ahead to achieve it. Your list of financial goals should be very specific, which would show that they are crystal clear in your mind.

• Plan for alternatives: You cannot expect your planning to go as per your wish, so you should always have a plan B at hand. After listing down your goals you plan for alternatives as well.

• Analyse the alternative options: You should ponder upon the feasibility of the alternative ways taking into account your social, personal and economic condition at present. The liquidity of your assets also matters in this regard.

• Creation and execution of your financial plan of action: Once you have planned about your alternative options and have analysed its feasibility, it is time for you to put these plans into action.

Charged Off Debts

If you are still doubtful on whether or not you should pay your debt, here are some things to consider:

If you are looking for a job, every company that is considering you for employment will do a background check and look at your credit report. Therefore, if you have a charged off debt that hasn’t been paid, you will be seen as an unreliable person, which may result in you being left unemployed.

You may know that an unpaid debt will damage your credit score, but it can do a lot more harm than that. This unpaid charge off will also hurt you when you are renting an apartment or making a major purchase using credit. However, if you are able to pay your debts even after they have been charged off, many will overlook your previous history and appreciate the fact that you paid off the debt eventually.

On the other hand, you need to make sure that the debt is legitimate, that the collection agency has the legal right to collect that debt and is licensed to do so in your State. Keep in mind that paying the debt, for the most part will not positively affect your scores so negotiating with the collection agency for removal of the item from your report in exchange for payment will be very helpful.

Basic Ways For Pick a Bank

Credentials

The credentials and reputation of the institution should also factor into the decision. Larger banks are generally a reliable choice due to FDIC deposit insurance. Check with the Federal Deposit Insurance Corporation to find out if a business is insured under this coverage.

Think about Physical Convenience

Physical convenience can be a key consideration in this decision. You might opt for a location that’s convenient from your place or work or your residence. Consider extended hours offered by some institutions if you work alternative shifts and you cannot visit during regular business hours. Online services can help with many types of transactions, offering services such as bill payment, automated deposits, and access to balance information. Find out about the location of ATMs you can use for no or low fee transactions. Some banks are national companies, providing customers with access to service and accounts from virtually anywhere in the country. Other businesses are local, providing no ability to travel and visit brick-and-mortar branches.

Explore Fees and Service

Every bank has a unique structure for fees and services. You will need to contact any institution you consider to find out these important details. Ask about account fees, minimum balances, ATM fees, overdraft protection, and overdraft fees. Find out how the they handle international travel to see if you will be able to get assistance with foreign currencies. Some businesses offer more services than others, some involving additional fees and some not.

Consider Personalized Service

Choosing a national company can afford you many conveniences. However, it’s important to realize that you may sacrifice some personalized service with this decision. A variety of services from a national business may be fine for many consumers. If you prefer a more personalized touch with a hometown brick-and-mortar branch, you may be happier with a local entity. Anyone with a busy lifestyle and a variety of financial activities such as IRAs, loans, credit cards, and online bill payments may be better suited to a large, national company. People with simpler lifestyles might opt for a local business instead.

Online Finance Services

Trending today is the very well-known concept of digital currency. Though there are still apprehensions about its use, it has taken the world with a sweep and gained popularity because of the convenience it has to offer. An example of digital currency would be the popular Bitcoin. Many online merchant websites have accepted bitcoin as the form of payment for making purchases from their website.

This type of currency does not require any identification on the part of a purchaser; therefore animosity is one chief benefit that it has to offer. In the form of investment, Bitcoins have proven to be profitable. This is because of the reason that its price in Dollar equivalents has been on the rise ever since its conception. If you own two Bitcoins that have a net present worth of $800, by the end of the year this price has all the possibility of rising up to $1000 for two Bitcoins. Thus, you can either use your Bitcoins for online transactions or keep them safe as an investment for your rainy days.

Finance over the internet has plunged into another very fascinating service – the crowdfunder. This concept is by far the most useful of all, because it enables entrepreneurs to gather online and share funds for their business. Elaborating it further, it means that if five people are interested in setting up a, say, online shopping business, but are short on funds individually – they can come together on a crowdfunding website and combine their money in a partnership. This way, they all get what they want, including the money to start their business. These people can also decide to share their funds with some other entrepreneur to help him get started. The internet has thus changed the scene of financing sector.

Islamic Banking Model

This banking system is based on the principles of Islamic law, also referred to as Sharia law, and guided by Islamic economics. The two basic principles are the sharing of profit and loss and the prohibition of the collection and payment of interest by lenders and investors. Islamic banks neither charge nor pay interest in a conventional way where the payment of interest is set in advance and viewed as the predetermined price of credit or the reward for money deposited. Islamic law accepts the capital reward for loan providers only on a profit- and loss-sharing basis, working on the principle of variable return connected to the actual productivity and performances of the financed project and the real economy. Another important aspect is its entrepreneurial feature. The system is focused not only on financial expansion but also on physical expansion of economic production and services. In practice, there is a higher concentrated on investment activities such as equity financing, trade financing and real estate investments. Since this system of banking is grounded in Islamic principles, all the undertakings of the banks follow Islamic morals. Therefore, it could be said that financial transactions within Islamic banking are a culturally distinct form of ethical investing. For example, investments involving alcohol, gambling, pork, etc. are prohibited.

For the last four decades, the Islamic banking system has experienced a tremendous evolution from a small niche visible only in Islamic countries to a profitable, dynamic and resilient competitor at an international level. Their size around the world was estimated to be close to $850 billion at the end of 2008 and is expected to grow by around 15 percent annually. While system of banking remains the main component of the Islamic financial system, the other elements, such as Takaful (Islamic insurance companies), mutual funds and Sukuk (Islamic bonds and financial certificates), have witnessed strong global growth, too. Per a reliable estimate, the Islamic financial industry now amounts to over $1 trillion. Moreover, the opportunity for growth in this sector is considerable. It is estimated that the system could double in size within a decade if the past performances are continued in the future.

Pros and Cons of an Online Wallet

If you are still thinking of obtaining an online wallet, the following things can make your decision pretty fast:

  1. Convenience. Carrying around a lot of money makes you a potential target for theft. Many will notice you and you may even feel paranoid-always looking around you-wondering if people nearby can potentially detect the amount of cash you bring. When you have an online wallet, you can do the same transaction from the convenience of any mobile connection that will allow you to transfer the amount necessary to purchase items or pay for services (like the EPS system).
  2. Time. Since you can transact as long as you have a connection to your wallet and the entity holding up your balances, you will have the ability to transact at any time from the convenience of your own home. You are in control of your availability and when you will do your purchases so even if your schedule is hectic, you can still do what you want to do.
  3. Traceability. Your transactions are connected to an entity who is able to provide you with a ledger of all the transactions that you have made and how much have been debited or credited into your account that is why every single centavo you sent is traceable and you can verify them or dispute should there be any existing inconsistencies.

However, having an online wallet can also prove to have its own inconvenience especially if your financial network does not provide services for such connections. The following are the major concerns for having an online wallet:

  1. Limitations. Not all services are tied up with all banks. There are payment networks that although they honor online transactions, do not honor certain financial institutions or are not yet coordinated with them-coordination may usually take a long time that is why there are still some items that you need to purchase by yourself.
  2. Security. Although all programmers and developer of online wallet providers do the best that they can every day to make their services better, the security of networks can still be vulnerable that is why there are still problems concerning online fraud and money laundering. One has to make sure that they are always doing their purchases and access on secured and trusted servers alone-although sometimes this can be unsecured too.
  3. Additional Charges. There are some banking or financial institution that will charge up extra-or businesses to-for online transactions as they will be charging it to the amount they also need in keeping their online businesses. So, what you normally pay for two dollars can now cause you two and a quarter.

Qualify Leads And Prospects

You should invest your money and time only after qualifying someone. Only then you should start selling the service or product to the prospect.

If you are not quite experienced you will jump at the given opportunity without properly studying the prospect. What happens here is you are trying to selling something on an assumption without the proper background check. It may or may not culminate in sales. Only mindless salespeople will do this kind of marketing and they will end up losing their energy and time chasing wrong leads.

Instead of talking all the time, try to listen to your prospect. Then you will understand whether he/she is a qualified prospect. If you listen to them your chances of selling will be much higher.

Spend time on qualified prospects, and you’ll achieve significantly more costly deals.

Even if you get a qualified lead you must put in a lot of effort to make him/her your customer. You must know all about your valuable prospect or else you will miss an opportunity to sell your product or service to them.

If you end up selling a product to a wrong customer or to people who should not have bought your product, it is not just bad for the customer but bad for you and your company.

To find a quality lead you must know how to evaluate a prospect. For instance, you must know what their drawbacks are. How have they evaluated your solution? What type of an organisation they belong to? These details are essential to personalise your pitch for your prospects.

Know their pain points and also about their organization and personality. If a salesman is not able to close a deal it shows that he did not know all the important details about his prospect and hence he did not properly qualify as lead.

Ask as many questions as possible to your customer and gather the correct information. There are certain qualifying questions which every salesman should be aware of. We list out the most important ones.

Customer profile

A prospect should match your ideal customer profile. How big is the company? What industry are they in? Where are they located?

Needs

You must know your customer’s needs to qualify the prospect. And you should know how to fulfil their requirements and requests. You should have an idea what result they are aspiring for, and how the result is going to impact their company or team.

Decision making process

You should also know how they make decisions and how many people are involved in the decision-making process. Are they impulsive buyers or do they take time to buy products?

For instance, some companies take almost a year to purchase products. But if you have a sales target to achieve in the next four months then they are not your qualified prospects.

Mobile ATM

1) Future:

Apart from cities in US, there are remote places where wired connections are not available. At these places wireless is the only option and works very efficiently.To reach to this untapped potential market it is very crucial for the banking sector to survive and grow into the tough competition.

2) Cost:

Before the wireless ATMs came the older one were connected by the landline and the rent had to be paid to the carrier. As there were advancements and now ATMs are operated with the modems which can be carried with them. If we compare the cost of the wired and the wireless. The wireless costs you almost half of the amount, this is for just one machine. If you are having plenty of them calculate the amount that you can save. No installation costs and no extra cost even if you move the machine. You have pay monthly just like your cellphone bill.

3) Installation:

The installation of the machine is too quick compared to the other one. If a bank decides suddenly to come up with a new branch and they want to attract the people they can use this option. For the older one you may have to request for the installation then they will give an appointment, etc. No need for all this. Ideally wireless modem needs 10-15 minutes for the installation as they are already programmed.

4) Flexibility:

Due to the progress in the wireless technology the data transfer has become faster than never before (4G). The towers that have come up for the communication in the cellular sector has been of a great importance. Earlier these mobile ATMs got a interference due cellphones at crowded places like events, exhibitions, etc. But now they can as fast as possible with no faults even at crowded places. You can move it anywhere at anytime.

Best Money Transfer Provider

The costs of transactions

Sometimes the exchange rate could be favorable but then, the costs per transaction may be high. This is not an ideal scenario for many. You need to consider just how much you will be charged as the commission or the transfer fees before a transfer can be effected. One way to make it less hectic is to consolidate the smaller payments into only one. This lowers costs. There are providers that have better rates and yet others waive the fees altogether when a large payment is made.

Convenience

Some of the companies offer a very easy way to signup, others take so much time. There are online providers that offer their services 24 hours a day, and seven days a week. You, however, need to see the delivery and payment methods that are offered so as to ensure that all your needs are satisfied. Check for features like mobile wallet options.

Currencies needed

Not all the companies will operate in all countries and even offer all currencies. When you have to send money to areas that are remote where currencies are not popular, you may have to deal with delays. It is important you check that the currencies that you need are actually offered before you settle for a specific provider.

How reliable and safe is the foreign exchange provider?

You need to assess the reliability of the company. Consider how long they have been in business. Consider the amount that has already been transferred and what others think about the services that they have provided so far. Security of the platform also has to be considered. This allows you to think more clearly and make the most informed decision.

Tracking the transactions

There are providers that allow you to track your transactions and create some alerts through emails. In this way, you can easily get the status of any order that has been placed. You can have some email updates sent and this helps in businesses. You lower risk of fraud this way.

Behavioural Economics

The traditional view of economics and financial decision-making

It is sometimes forgotten in economics that the field is meant to be about the behaviour of people when making financial decisions.

The traditional economist’s view is that the world is populated by unemotional, logical, decision makers, who always think rationally in drawing their conclusions. This view is underpinned by the understanding that human behaviour displays three key traits: unbounded rationality, unbounded willpower, and unbounded selfishness.

This has always flown in the face of the findings of cognitive and social psychologists, who questioned these assumptions as far back as the 1950s.

With the rise of behavioural neuroscience since the 1980s (especially Kahneman’s work) providing more insight into the workings of the brain, we are now more sure than ever about the role that emotion and bias plays in all decision-making: from simple day-to-day decisions like which dress to wear, through to larger decisions that may affect many people.

Overconfidence and optimism are two examples of behavioural traits that may lead to sub-optimal financial decision-making, and divert from the traditional model used. People have also been shown to make poor decisions, even when they know it’s not for the best, due to a lack of self-control.

So this is where behavioural economics has been able to step in and modify many of the beliefs of the traditional economic views.

What is behavioural economics – and how can it help?

Behavioral economics and behavioral finance study the effects of psychological, social, cognitive, and emotional factors on economic decisions.

This may apply to individuals or institutions, and involves looking at the consequences for market prices, dividends, and resource allocation.

Of the three traits of human behaviour included in the traditional model outlined above, unbounded rationality has received special focus, with new understandings in the field resulting from neuroscience.

Understanding better how people arrive at financial decisions can help in many areas: from personal finance to organisations shaping products and trying to get more customer sign-ups; and from the vagaries of stock market trading through to governments and how they formulate financial legislation.