How to Compare Free Credit Monitoring Offers

Given the frequency and scale of cyberattacks affecting U.S. companies, it’s likely your information has been or will be caught up in a data breach. And as we’ve seen in the past, companies that have experienced breaches usually offer their customers some sort of free credit monitoring or identity theft protection plan to help deal with the aftermath. If you’ve been involved in multiple breaches, then you may have received multiple offers for free credit monitoring from different companies which provide the service. But which ones should you sign up for, and how do the different plans compare to one another?

“You need to read what you’re actually being offered,” said Adam Levin, identity theft expert and chairman and co-founder of Credit.com. “In some of these offers, they’re kind of vague, so you need to say, ‘What am I actually getting, and how do I sign up for whatever it is?’”

Some people opt into all of the plans they are offered — they may have different coverage periods, and different services are offered by different plans. Others may prefer to keep things simple and choose only one. Regardless of your choice, here are a few things to consider when reviewing your options.

What Data Does the Service Monitor?

Most consumer credit data (in addition to public records and other consumer information) are reported to the three major credit reporting agencies: Equifax, Experian and TransUnion. Some credit monitoring services review what’s happening on all three credit reports, and some offer only single-bureau monitoring. Because data varies among agencies, three-bureau monitoring is more valuable.

Monitoring services have several levels of detail, and the more closely your data is analyzed, the more helpful it is likely to be to you.

Some monitoring services review summaries of your credit report, which are known in the industry as “header files.”

“It would be the same as looking through the table of contents instead of reading the book,” said Michael Bruemmer, vice president of consumer protection for Experian. Experian’s ProtectMyID products have been offered by some companies that experienced data breaches, including Target and Premera.

Header file monitoring means a consumer would be notified if there was a change in the number of accounts on the person’s credit report, if there have been new inquiries or if debt levels have increased. A credit monitoring service may or may not include checking for changes in all aspects of a report.

“In some cases the monitoring is only looking for maybe new credit openings,” Bruemmer said. “It may not look at inquiries, it may not look at public records, it may not look at account takeover actions.”

Who Does It Serve?

A more complicated aspect of credit monitoring has come into play in the wake of the data breaches of health insurers Premera and Anthem — child identity theft. Millions of minors’ personally identifying information was exposed in the breaches, which can be used to open fraudulent credit accounts, among other things.

“The process that we use, which is a patented process, looks for the creation of a credit file,” Bruemmer said. “When we sign up and we protect a child, we’re looking for the creation of a file, and then we’ll notify the guardian or the parent. … In most cases it’s a sure sign of identity theft.”

Child credit monitoring processes vary, just like they do for adults. Find out what fraud indicators a product looks for and how you will be alerted to them. Additionally, some monitoring services go beyond the credit report and check public records databases. Some regularly scan the Internet for signs that your personal information has been abused. There are so many possibilities, so you want to look at the details of your offer and find out exactly what you’re getting for free, and for how long. When you’re comparing your options, it probably makes sense to focus on the service that gives you more.

What’s the Timeline?

Fraud can happen at any time, which is why constant monitoring is best. Find out how often the credit monitoring reviews your information for changes — whether it’s constant, daily, weekly, monthly or quarterly — and as soon as you’re notified of credit activity, follow up on the alert. That may involve you calling a hotline for more details or logging into your credit monitoring account online.

On average, it takes consumers 222 days from the time fraud has occurred for a consumer to notice it, Bruemmer said, so the sooner you can find and address suspicious activity, the better. Credit fraud and identity theft can damage your credit score and be costly to reverse, both in terms of your finances and your time.

Is There a Support System?

Credit monitoring often comes with fraud resolution services, but not always. At the same time, fraud resolution may be offered without credit monitoring — it usually comes in the form of a hotline you can call if you detect unauthorized use of your credit or identity.

Trying to resolve identity theft or credit fraud on your own can be daunting, so it’s nice to know there’s someone to help you navigate the process after you’ve found something fishy. Some companies offer identity theft insurance, as well, which can ease the financial burden that sometimes comes after a fraud incident.

Choosing a free credit monitoring or identity theft protection service comes down to being informed and doing what ultimately makes you feel comfortable. A free product, even if it doesn’t provide broad coverage, may be worth taking as an added security measure, but you still need to pay close attention to activity across all your financial and online accounts. You can check your free annual credit reports at AnnualCreditReport.com and you can get two of your credit scores for free every month on Credit.com.

Levin noted that, as helpful as free monitoring may be, it’s mostly something companies offer as part of their public relations strategy after a breach. The freebies expire, but the threat of fraud will not.

“You have to have something that continues on beyond the breach, because no one is going to give you lifetime credit and identity monitoring,” Levin said. “Unfortunately, you have to engage in a lifetime of credit and identity monitoring if your Social Security number was compromised.”

There’s no monitoring system that will catch any and all fraud someone may commit using your identity or accounts, but in general, when comparing credit monitoring or identity theft protection services, look for something that reviews multiple data sources, provides details on detected changes and offers guidance for resolving problems.

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This article originally appeared on Credit.com.

This article by Christine DiGangi was distributed by the Personal Finance Syndication Network.


Is an SAT Prep Course Worth the Cost?

Only one thing was stopping Justis Slattery from playing soccer in college: his SAT scores. He found a school he wanted to attend, and soccer coach he really wanted to play for, says his mother, Stacy. He earned a coveted spot on the team, and an admissions counselor told him he shouldn’t have any problem getting in.

But then he learned his highest SAT score was exactly 100 points below where it needed to be in order to get accepted. “It’s kind of heartbreaking,” said Stacy. “Nothing matters to him unless it’s soccer.”

Like many students, Justis had tried studying for the test on his own. He bought the Official SAT Study Guide. (Known as the “Blue Book,” it costs about $22, depending on where it is purchased.) But with a full schedule of classes, along with soccer practices and games, he didn’t spend a lot of time going through it.

But when he learned 100 points was the only thing standing between him and his dream, his priorities changed. His mom hired his middle school math tutor, who also tutors students preparing for the SAT, and they went to work. Before and during spring break they spent seven hours working together.

And it worked. Justis took the test again and scored exactly 100 points higher. He was in.

Is It Worth It? Maybe

Stacy says the key was having someone sit down and go over it with him. And that’s often the case, says his tutor, Linsea Mohr. “As a tutor, I see myself more as a puzzle decoder. I just show students how to arrive at the answer the most expediently and then they fly solo.”

Parents often agonize over whether to pay for test prep classes or tutors, but ultimately many do spring for it; the tutoring and test prep industry makes billions of dollars a year. Often, when they do pay for it, they wonder if it’s worth it.

“It’s absolutely worth it,” says Debbie Stier, a single mom with two teenagers who wrote the book The Perfect Score Project about her experience taking the SAT multiple times in an attempt to earn a perfect score. She didn’t get one, but she did raise her score by 330 points — and she helped her son raise his score 590 points (of a possible 2,400 composite for all three portions of the test).

Overall, though, the track record isn’t so hot: a 2009 paper published by the National Association for College Admission Counseling says research has found the average gains from test prep to be “more in the neighborhood of 30 points.”

Stier has since created an online course in critical reading and tutors students one-on-one as well, but she emphasizes that parents don’t have to spend a lot of money on prep. She recommends students rely primarily on the official College Board material to study but can also “use non-official material to build the muscle. Any nonfiction college-level material works.”

For example, she recommends teens read one article a day from The New York Times, The Economist or the The Wall Street Journal. The parents get homework too: Together, you “talk about the main point,” she suggests. “Research shows that studying out loud leads to deeper, more meaningful learning,” she adds.

My daughter recently took her first official SAT as a sophomore. She was invited to be a beta tester for truePrep, a company that is blending technology and the personal touch. She started by taking a practice SAT (using an official College Board test), which was then used to assess her strengths and weaknesses. The company says it uses a proprietary algorithm to hone in on the specific areas students need help with, and to help pinpoint areas where students have the greatest potential for raising their scores. Her tutor worked with her on those key areas via sessions on Skype. She took additional practice tests and, again, her plan was fine-tuned. When she finally took the actual test, she scored 160 points higher than her initial score.

Although my daughter is generally an organized and self-disciplined student, she says she appreciated the forced discipline of her tutoring sessions; between homework and extracurricular activities, she’s not sure she would have made the time to prep — at least not during the school year. And she liked the fact that those sessions didn’t waste her time on areas where she wasn’t having trouble.  “We’ve built our program to be super-efficient,” says truePrep cofounder Andrew Finn. “You can really zero in on the student’s weaknesses.”

Of course, motivated learners can always tackle the test themselves. Katherine Long says she earned a perfect score on the SAT using the Blue Book as her only study guide. “It wasn’t hard, just time-consuming — you have to dedicate the hours into it,” she says. “When I started, I wasn’t good at attention to detail so I kept messing up on the math section, but fixed it by just forcing myself to be more attentive. For the verbal section, I didn’t know SAT vocabulary when I started, but just kept learning and used flash cards. For reading comprehension, you have to remember that the answers are already there in the passage, you just have to find them.”

In addition to the College Board materials, there are dozens of free and low-cost tools and apps that can help students learn vocabulary words, take sample test questions and prep at their convenience. (But be sure to read reviews — some have been criticized for giving wrong answers.) One of the most popular? The College Board’s own free Question of the Day. And the Khan Academy has partnered with the College Board to provide free test prep tools, including new ones that will help students prepare for the redesigned test to be launched in 2016.

How to Pay for SAT Prep

If you decide to pay for a class or hire a tutor, here’s what not to do: raid your child’s 529 college savings funds. If you do, you’ll have to pay taxes and a 10% penalty. “It would not be a qualified expense,” warns Jim Ludwick, CFP and founder of Main Street Financial Planning. That means you’ll either have to shell out the money out of your current income or savings, or find another option.

1. Use Interest-Free Financing 

If you must pay for a package deal upfront, you can consider using a 0% credit card offer to pay it off over time while avoiding interest charges. Some card issuers offer 0% for up to 18 months on purchases while others offer similar deals on balance transfers. (Credit.com publishes a list of the Best Balance Transfer Credit Cards in America.) Just make sure you can pay off the balance before the free financing period expires. And if you take advantage of a balance transfer offer, keep in mind most, though not all, issuers charge a balance transfer fee of up to 4% of the amount transferred.

2. Create Your Own Payment Plan

While some programs may charge you upfront, tutors often work on a pay-as-you-go basis. TruePrep, the program my daughter used, for example, charges $75 an hour, and doesn’t require a long-term contract. If you sign a contract for tutoring or test prep, make sure you understand the commitment you are making. The last thing you want is to stop paying and have a debt turned over to collections, where it hurts your credit scores. (You can see if a collections account is affecting your credit scores for free on Credit.com.)

3. Get Creative

Kreigh Knerr says he once bartered his services as an SAT tutor for voice lessons. “My old voice teacher had a high-school-aged child, and we traded voice lessons for SAT prep,” he says. A former teacher who now runs the Knerr Learning Center in Milwaukee, he normally charges $250 per hour-and-a-half tutoring session, and his voice teacher’s rate was $100 an hour, “but we just did a straight exchange of SAT session for voice lessons,” he says.

Charlotte Baker says she found an SAT course her daughter Eva really wanted to attend, but couldn’t afford it. (Eva, who blogs about money at TeensGotCents.com previously shared her SAT experience with Credit.com.) Says Charlotte: “After speaking with the instructor I found out that if I hosted the class by finding a facility, helping advertise the class, and being there that weekend to do anything needed that the class would be free for my children! I did all that was required, lots of other people attended and I didn’t have to pay a dime! It was a great way to get some incredible training for my daughter that wouldn’t have been possible otherwise.”

Ann Logue says she bought an SAT prep book for her child from Amazon using her Chase credit card reward points. But that’s it. “My kid’s school uses Naviance as part of its college counseling, and one of Naviance’s features is online SAT and ACT review,” she says. (Naviance offers a online test prep program called PrepMe.)

Stick to Basics

Finally, keep in mind that throwing money at test prep doesn’t guarantee a better score. Sometimes just taking the test again can raise your score, especially if you feel less stressed and more comfortable the next time around. Also keep in mind that scores on standardized tests are just one factor many schools look at. Grades and extracurricular activities help as well. There are schools that don’t even use those scores, so if all else fails, you may want to try a different school.

“I ended up at Wharton,” says Long, who studied and earned a perfect score. But she says that wasn’t everything. “Outside of academics, I had founded and was running a business (a fashion magazine) on the side. If you’re looking to get into an elite college, after you hit a certain level in SAT scores, it really doesn’t matter — it’s about your passions, extracurriculars, and hook.”

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This article originally appeared on Credit.com.

This article by Gerri Detweiler was distributed by the Personal Finance Syndication Network.


You Could Be Risking Your Child’s Online Privacy

By now, you know that even though online crime is under-reported, it’s still a big deal. But do your kids know that?

Whether intentionally or not, you could be exposing your child to online invasions of privacy. According to a study done by TRUSTe, a data privacy management company, lots of parents are worried about their kid’s privacy online, but they may not be handling it the right way.

“While parents are concerned, they don’t always protect their children’s privacy online,” said Chris Bable, CEO of TRUSTe, in a statement. “Companies need to work with parents and their children to ensure transparency and help protect children’s data.”

The big number: 58 percent of parents said they are concerned about their child’s privacy online. Here’s what we learned from the study, and what you can do to minimize your child’s security risk when he or she goes online.

With a good password identity theft is more rare, but we can make you more secure.

When parents do more harm than good

According to the study, a full 24 percent said they do not allow their child to use the Internet. Why? Their reasoning includes:

  • 57 percent said they were worried that their child would be exposed to inappropriate content;
  • 44 percent think their child will share personal information online;
  • 43 percent think their child will share personal information online that they will later regret.

But the irony is that while so many are concerned about kids sharing stuff they’ll regret, parents are sharing photos of their kids all over Facebook and Instagram. Almost 70 percent of parents admitted they’d posted photos of their kids online, and 35 percent post photos once a month or more. In addition, 1 in 5 parents said they helped their kids who were under 13 years old set up social media accounts.

That’s not illegal, thanks to the Children’s Online Privacy Protection Act, which was passed by Congress in 1998. It requires all websites selling services or collecting information to obtain parental consent before collecting information from kids under 13. But just because kids are going online legally doesn’t mean they’re doing it safely.

How to talk to your kid about staying safe online

If you don’t take anything else away from this study, remember this: The best way to protect your kid from scary stuff online is by talking to them about it. TRUSTe says that 74 percent of parents think their child understands “a small amount or nothing at all about the issues surrounding privacy online.” If that’s you and your child, keep these tips in mind:

1. Start early. Your kid born today is a digital native, so don’t think it’s out of the question to broach the topic of internet safety with a kindergartner.

2. Initiate the conversation. Even if your kids are comfortable approaching you, don’t wait for them to start the conversation. Instead, find examples in your everyday life to talk to your child about Internet safety. This can be something as simple as seeing a billboard or ad about cyberbullying, and taking the time to explain to your child what it means and what to do if they experience it.

3. Be honest and supportive. Without a foundation of trust and support, kids aren’t going to be forthcoming about what they experience on the Internet, whether it’s harassment or strangers who make them uncomfortable. Make sure you cultivate an environment of trust and let your kids know they’ll never get in trouble for admitting something serious.

4. Be patient. Especially with younger children, it can take a while for something to sink in. It’s best to broach the topic several successive times; if the information is repetitive and simple, they’ll absorb it better.

The post You Could Be Risking Your Child’s Online Privacy appeared first on Debt.com.

This article by Jess Miller was distributed by the Personal Finance Syndication Network.


More Reasons Why You Shouldn’t Bother With Gas Credit Cards

Last June, I wrote about why you should get rid of your gasoline credit card — because the rewards just aren’t competitive. Since then, the price of gasoline has plummeted, which might seem to help the case for some gas cards. Nevertheless, these cards are still a bad deal…

Low gas prices don’t help gas credit cards

At 10 cents off the price of gas, that equals a 2.5 percent discount off of gas at $4 a gallon, as it was in many places last June when I ran the numbers. But with gas now at around $2 a gallon in many places, that same discount is now equal to 5 percent off per gallon.

But you’re still getting the same absolute savings in dollars that you would have, regardless of the current price of gas. As I detailed last year, that absolute savings works out to be small compared to other reward credit cards, even if you drive a lot.

High APR

Creditcards.com recently conducted a survey of the 20 largest major-brand gas cards — and found that their disadvantages are legion. For example, gas cards had an average APR of 24.14 percent, far above the rest of the market, which is around 15 percent.

Low bonuses and confusing rewards

Creditcards.com also found these cards offered sub-standard sign-up bonuses, and their rewards were filled with confusing terms and limitations such as minimum spending thresholds, maximum limits, qualified purchase requirements, and tiered rewards levels.  And of course, they reached the same conclusion that I did: Rewards offered aren’t competitive with other reward credit cards.

“Gas cards are the dull, boring sedans of the credit card world,” according to Matt Schulz, CreditCards.com’s senior industry analyst. “They’re stuck in the slow lane, destined never to be flashy.”

creditcardad

The wider lesson

So gas cards stink, and you knew that because you read what I wrote last summer. (You do read everything I write, don’t you?)

So why am I beating on the same drum again? The lesson here is not just that gas cards are bad, but that reward-card owners must manage their portfolio strategically. It’s not enough to just apply for a credit card that offers a discount on what you would have paid. You have to compare the discount to what you would have gotten from a competing credit card, since you can apply for every card you are offered.

This is as true for gas cards as it is for a store card, frequent-flier mile card, or any other reward card. Once you understand that, than you will be in a position to evaluate any reward credit card offer.

The post More Reasons Why You Shouldn’t Bother With Gas Credit Cards appeared first on Debt.com.

This article by Jason Steele was distributed by the Personal Finance Syndication Network.


How Long Will $1 Million Last You?

Can money buy happiness? Last year, both Forbes magazine The Wall Street Journal researched this question. Their conclusions were, well, inconclusive.

“Well, maybe,” Forbes said.

“It’s true to some extent,” the Journal said.

Here’s the problem: How much money do you need to be happy? To be more specific, how much do you need to stop working? Earlier this year, the staffing firm AccounTemps asked employees what they would do “if you were to suddenly strike it rich.” Only 23 percent would quit their job, while 36 percent would stay put.

Of course, “strike it rich” means different things to different people. Let’s take a graphic look at “becoming a millionaire”…

$298,100 to buy a new home

That’s median price as of December 2014. And that’s for not an especially fancy one. Source: Census Bureau

$245,000 to raise a kid to adulthood

Includes housing, food, transportation, clothing, health care, education, child care, and “miscellaneous expenses.” And since the average American family has two children, double that. Source: Department of Agriculture

creditrepairad

$16,000 on a 2015 Toyota Corolla

This is the cheapest trim option for the best-selling car of all time, the Toyota Corolla. Since the average American buys nine cars in his lifetime, and he lives an average of 79 years, that’s two new cars in 18 years. Sources: AutoBlog, Kelley Blue Book, CNBC, CDC

$6,598 for food

That’s per year, so multiply by 18. And yes, about half of it is spent on eating out. Source: Bureau of Labor Stastics

$1,246 for a vacation

That’s per person, so if you’re the average family, multiply by four. You’ll want at least one per year, right? Source: American Express

The post How Long Will $1 Million Last You? appeared first on Debt.com.

This article by Michael Koretzky was distributed by the Personal Finance Syndication Network.


How To Start A Successful Blog?

How To Start A Successful Blog?

Tons of new blogs are launched each day by passionate people who love to share things and ideas online. Many blogs actively updated and gets popular and successful at a time, also many  of them gets dead and become inactive. There are many reason of getting a blog dead or inactive. Most of people have no idea what it takes and how to start a successful blog. You can think of popular blogs and even you can start a blog and make it popular like that one.

For this, you should have patience. It could take few months hard work and will return nothing in start. You take hours to write articles and gets nothing. It usually happens at start for few months. Don’t lose hope and don’t give up. Keep updating your blog with the articles that establish readership and day will be no far when your blog will become popular and successful. You completely have to focus on your blog and have to sacrifice for many things to make it popular.

how to start a successful blog

So, how to start a successful blog?

There are many things we have to care about…

1. Choose Niche For Your Blog

Most blogs gets unsuccessful because bloggers just focus on which topic will make them more money and they do not focus on their circle of interests.  When you start blogging about an idea you’ve no interest. It would result in failure of your blog. You should be passionate about your blog’s idea. Think about your favorite websites and follow them and find the focus of your interest and follow it for your blog.

2. Think About How Your Blog Will Monetize

Before starting your blog, you must have an idea about your blog will monetize. For this reason, you must ask yourself some of the following questions and if get a positive answer, move on and start it.

  • Your competitors.
  • Ways blog would monetize.
  • How long it would take to monetize.
  • What’s different and useful in your blog.
  • Problems that can be faced after launching.

If you get fully satisfied with the answers you get, you will not have to face any unexpected problem and no doubt it would give a super push in making your blog popular and successful.

3. Choose Blog Domain Name And Reliable Hosting

It could be a little hectic. Domain name is the most important part of branding your blog. Your blog domain name should be similar to your blog idea. Best is to try your keyword in domain name and try it on .COM extension because it’s the most popular extension. If can’t find on .COM, try any different but try the popular one like .NET, .ORG and many others. Once you found a perfect domain name for your blog, register it on domain hosting website like GoDadday.

It is essential to host your blog or website over a hosting website. Find a reliable,fast responsive and affordable hosting service. Hosting your blog will alot you a remote space on the server to store your blog contents that would never go offline. You can choose shared or dedicated server as per needs.

4. Design Professional Blog

Blog design makes first impression of your blog to the visitor. Your blog is judged through it’s look. Make your first impression so effective that visitors would love to stay. Always try to keep your blog design clean and professional. This would be helpful in finding content easily. And don’t place flash banners on the blog that make your blog look rough.

You should keep your first focus to establish readership. Make a fast loading blog design. It is essential to make your blog user friendly. Optimize the blog design in the way it loads pages super fast. If your blog loads faster, search engine lists your blog up in ranking and your website will get gain high organic traffic.

5. Search Engine Optimization Of Your Blog

The most important part of the blog is it’s optimization for the search engines. Your blog ranks up as you optimize it. You can optimize your blog in the following ways.

  • Post unique content. Avoid copying content from other websites. Write your own optimized content.
  • Choose a ‘focus keyword’ so wisely and write content related to it.
  • Add robots.txt and allow the permissions to the search engine for crawl.
  • Place sitemap to your blog. So,your blog pages and posts get indexed in the search engine.

If you’re using wordpress content management system, add any of the following SEO plugins.

  • WordPress SEO for all.
  • One SEO Pack.
  • SEO by Yoast

6. Keep Your Blog Up To Date

To run a successful blog, research articles time to time and act positively on feed backs. Write content related to your topic at least thrice in a week. Long term goal is to become an authority in your subject. Few following good things to follow for writing a successful content.

  • Update blog with latest news in your niche.
  • Subscribe to other good blogs related to your niche.
  • Research about your niche in books and on the internet.
  • Proofread your articles, be honest, be original and learn from the best.

7. Make Social Network Pages For Your Blog

After search engines, social networks are the largest source of traffic over the web. It is important to make your blog appear in social media. This will make your blog popular and people’s interaction increase for your blog.

Simply make article on your blog and share it on your social page. It’ll surely turn followers to visit your content and will become a source of traffic.  There are few most popular social networks are Facebook, Twitter and Google+ and many others. Make a state of showing connections to your social networking profiles appear in your sidebar to encourage readers to follow you.

8. Engage Blog Readers

You must definitely attempt to engage your followers throughout feedback, social media marketing, your e mail list, not to mention, via your writing. It’s also possible to work with podcasts along with video clip in order to talk straight to your market. This can establish loyal readership that spreads the word about your blog.

9. Make Relationship To Other Blogs Of Your Niche

Sometimes, after working so hardly on your blog, making it’s design optimized and writing a unique search optimized content can not make your blog popular and blog readership doesn’t grow. This is really a discouraging and frustrating thing. Mostly bloggers quit blogging because they work so hard and get no grow in valuable readers.

To make your blog successful and popular, you have to make relations with other blogs of your niche. There are few ways to do this:

  • Be connective to other bloggers.
  • Make guest posts to other blogs.
  • Communicate and write on forums.
  • Be active on social networks.
  • Compete with other blogs.

10. Monetize Your Blog

Now, finally you have to look how your blog will generate revenues. Choose affiliate products that can be sponsored through your articles. Implement the monetization strategies to let your blog get high revenues.You are able to monetize your blog from affiliate networks, sponsors, premium posts and ad networks like Google Adsense, Infolinks  and many more. Be careful in placing ads on the blog and make sure that ads do not effect the design of your blog.

These are the 10 most important strategies needed for how to start a successful blog. 

This article by Mubeen Jalib first appeared on Computer Tricks Point and was distributed by the Personal Finance Syndication Network.


Can I Get a Car Loan If I Have No Credit?

What do you do if you need a car and you don’t yet have a track record to make a dealer confident you’ll be able to repay a car loan?

Phil Reed, senior consumer advice editor for consumer auto site Edmunds.com, said a surprising number of people who aren’t sure of the answer to that question go to dealerships and essentially say, “Hi, I have no credit, and I want to buy a car.” It’s not an approach he recommends.

Instead, he suggests trying to get pre-approved for a loan before walking through the door. But even that could be more complicated than it seems. “You have to choose the right car and the right amount (to borrow),” he said. What you are looking for is reliable transportation you can afford. So your initial shopping may start at your computer.

If you have a relationship with a bank or credit union, Reed recommends starting there to look for financing. Particularly if you have a “thin” or nonexistent credit file, he advises trying to get an in-person appointment — and bringing pay stubs and any bank account records with you. “Make a case for yourself,” he said. Edmunds recommends putting at least 10% down on a used car. In addition to reducing the amount you’ll need to borrow, it shows the lender some commitment on your part. (A trade-in could also be used as a down payment, Reed notes.) We also advise checking your credit reports, if they exist, and credit scores. You want to know as much about your credit profile as a lender would.

Reed said that even though a dealership may well be able to beat an offer from your bank or credit union, if you have that loan approval, you needn’t worry about whether you can get approved. You already know you can be — now you can compare rates or negotiate as a cash buyer, focusing on price. You don’t want to feel so indebted to the dealer for “giving” you a loan that you fail to negotiate on the price of the car, he said. And if the dealer’s financing isn’t any better, you have an approval in your pocket.

Reed said it’s important to be confident the car is affordable to you even if it’s not the car you’d choose if you had more money and better credit. “If you have no credit, it’s not time to get your dream car,” he said. “You can move up later.”

He also cautioned that the interest rate you’re offered may seem appallingly high, but that may be part of the cost of not having much of a credit history. He said that if a car buyer is paying on time and building credit, refinancing is a possibility. He said a former dealership employee told him he once saw a customer decrease his interest rate from 13% to 2% in two years’ time, by improving his credit and refinancing. (You can check your credit scores for free every month on Credit.com to track your credit building progress.)

That’s one reason he advises biting the bullet and paying a higher interest rate over getting a co-signer. Co-signing will involve checking someone else’s credit and using that to qualify (it might get you a lower rate — or might not, depending on their credit score). It will tie their credit profile to the way you repay your car loan. Reed said if you’re going to do it, it’s pretty much a last resort, and it should be a relative. Bottom line, though: “It’s asking a lot.”

Better, he says, to finance the car yourself and pay on time, which will help build your credit. That way, you won’t have to go through worrying about whether you’ll qualify for a loan next time.

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This article originally appeared on Credit.com.

This article by Gerri Detweiler was distributed by the Personal Finance Syndication Network.


Why You Should File Your Taxes by April 15, Even If You Can’t Pay

Q. I will owe taxes this year, but I don’t have the money to pay the bill. What should I do?

A. Even if you don’t have the cash to pay, you should still file your return on time. If not, you’ll end up owing even more, and that won’t be any good. And not filing at all isn’t an option.

As long as you file on time, you won’t face a penalty for filing late, said Joseph Matheson, a certified public accountant with Matheson & Associates in Whippany, N.J..

“Pay as much as you can with your tax return,” he said. “The more you can pay with the return, the less interest and late payment penalty you will incur.”

You can pay online with IRS Direct Pay, which is an electronic payment option available from the Internal Revenue Service, Matheson said.  It allows you to schedule payments from your checking or savings account for no charge and you’ll receive an immediate payment confirmation.

Then, pay the rest of your tax as soon as you can.

“If it is possible, get a loan or use a credit card to pay the balance,” Matheson said. “The interest and fees charged by a bank or credit card company may be less than the interest and penalties charged for late payment of tax.”

That can be especially true if you already have a low-interest credit card (here are some of the best) or one with a 0% financing offer.

Matheson said the IRS offers an Online Payment Agreement tool which allows you to ask for an installment agreement.

“You can use a direct debit plan. When you pay with a direct debit plan, you won’t have to write a check each month,” he said. “If you can’t use the IRS.gov tool, you can file Form 9465, Installment Agreement Request instead.”

But whatever your situation, don’t ignore a tax bill.

“The IRS may take collection action if you ignore the bill,” Matheson said. “Contact the IRS or your CPA right away to talk about your options. If you are experiencing a financial hardship, the IRS will work with you.”

Hopefully next year you won’t owe, or you’ll get a tax refund, so review your withholding to make sure you’re not in the same mess next year.

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This article originally appeared on Credit.com.

This article by Karin Price Mueller was distributed by the Personal Finance Syndication Network.


How to Turn the Tables on Your Debt

No one really wants to talk about debt and certainly no one wants anyone else to know they have debt. The reality is that most people have debt and that debt is not necessarily a bad thing. In fact, you can use debt as a tool to help you get what you want in life. However, I have found that people will quickly tell me that they don’t have any debt at all because in reality they don’t want to catch the debt disease. Debt has the stigma of being dirty, bad and associated with people who don’t pay their bills. I can tell you that’s not really the case. Debt, when used as a tool, can be a good thing, something you live with and something you may even end up liking.

The Good, the Bad & the Ugly

The first step towards being able to embrace debt as a tool is understanding the difference between good and bad debt. Simply put: all debt can become bad debt if it becomes unmanageable. If you’re able to make your monthly payment in full and on time and you have positive cash flow, then congratulations, you have good debt. If you’re struggling to scrounge up the money each month and constantly find yourself making late payments or robbing Peter to pay Paul, then you have bad debt.

Budgeting Isn’t a Dirty Word

Budgeting is key to start making debt work for you instead of against you. Knowing how much money you have coming in and going out each month will tell you what sort expenses you can afford. Let’s say you’re looking to lease or finance a new car. After taking a look at your monthly expenses, you see that you have enough money left over each month to afford a $200 payment. A loan under $200 then would be good debt because you know you’ll be able to manage your payment. On the other hand, anything over $200 will be a stretch and would fall under the ‘bad debt’ category.

Pick Your Battles

Just like you wouldn’t use a screwdriver to hammer in a nail, there are some instances where debt just isn’t the right tool for the job. Let’s say for this year’s Super Bowl you want to get a better look at the game. You head to the store in hopes of picking up a new TV and find one that’s just perfect. Problem is, it’s way out of your price range. Thinking over your options, you decide that you could pick it up today by charging it to a credit card and paying it off over the next couple of months. You have to ask yourself if this really makes sense to you in the short and long term.

Can you afford the payments? Do you really need the item? What is going to change in the next few months in terms of your finances, meaning will you have more money/bills? Remember, if you wind up purchasing the TV, you don’t want to find yourself struggling to pay for it later.

Your Credit Is Married to Your Debt

This is true in sickness and in health. The reality is just about all debt shows up on your credit report. This can help your score or lower it depending on how you’ve managed your debt. It can help at first but then hurt it or hurt it but then help it. Let’s say you have that car loan we talked about earlier and you’ve been making on-time payments for two years. Then you lose your job and stop paying. Now the same credit account that was helping your credit has flipped and impacted your credit negatively when the lender reports that you have not paid your bill.

You can check your free annual credit reports on AnnualCreditReport.com to make sure your debts are being reported to the major credit bureaus and that they’re accurate. Your credit scores are based on this data, so an account that incorrectly shows a late payment can ding your score, turning it from good debt to bad debt. You should dispute any inaccuracies with the bureau. You can also see how your debt is impacting your credit scores for free every month on Credit.com.

Arming yourself with the right knowledge and debt management strategies can help to turn debt from a burden into something beneficial. If you keep what I shared here in mind the next time you consider taking on debt, you’ll find yourself making much smarter financial related decisions. So stop living in fear of debt and start seeing it for what it can do for you today.

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This article originally appeared on Credit.com.

This article by Leslie Tayne was distributed by the Personal Finance Syndication Network.


Can You Discharge Private Student Loans in Bankruptcy?

There’s a big misconception that private student loans can never be discharged in bankruptcy. People have repeated that statement so often they believe it to be a fact. The only problem is it’s not quite true.

Some private student loans are clearly eligible to be wiped away in a consumer bankruptcy. Even in a Chapter 7 bankruptcy, it takes only about 90 days to forgive the debt tax-free.

And while these special rules apply to private student loans that meet some criteria, all private students loans are no longer legally collectible once they have expired under the statute of limitations in your state. In that case, while they may be listed as a debt on your bankruptcy filing, there isn’t much of a need since the lender can no longer sue you or garnish your wages over those debts. In some states, the statute of limitations is as little as three years. In others it is 15 years.

But for some private student loan debt you don’t have to wait that long. You don’t even have to wait a week.

Where Did You Go to School?

If you owe private student loans for a school that was not accredited, your loans can probably be discharged in a Chapter 7 bankruptcy right away. Even some big-time lenders still make private student loans to such unprotected organizations. It’s quite common to find vocational and trade school students with these types of unprotected loans. Flight schools for pilots seem to notoriously be unaccredited. Yet pilots errantly labor under hundreds of thousands of dollars of unmanageable student loans believing there is no hope for them. You can see some real case studies showing how easily these loans were discharged.

In particular the issue that makes these private student loans so easily dischargeable in bankruptcy is the fact the school was not a “eligible educational institution” or that the loans were for a “qualified higher education expense.”

In order for a loan to be qualified as a private student loan:

“(1) it must have been made under a government or nonprofit student loan program, or (2) it must be a qualified educational loan under section 221(d)(1) of the Internal Revenue Code, for attending an eligible education institution as defined in section 221(d)(2) of the Internal Revenue Code, and incurred for costs of attendance as defined in section 472 of the Higher Education Act.”

As bankruptcy attorney Craig Andresen says, “For example, perhaps you were not an “eligible student” at the time the private student loan was made to you; or maybe the loan was not incurred to pay ‘qualified education expenses’; or perhaps the loan was not for attendance at an ‘eligible education institution’ because the school was not accredited under Title IV of the Higher Education Act. All these are requirements imposed by section 221(d) of the Internal Revenue Code. Failure of a private student loan to meet any of these criteria means that the loan is fully dischargeable, because it would not qualify under section 523(a)(8) of the bankruptcy law.”

But the characteristics of a private student loan get even more specific. Just because a school was accredited, they must also have offered Title IV federal loans or the private loans may not be protected from discharge in bankruptcy.

Some attorneys have also reported to me other types of entities have been financing services using private student loans. One facility on particular was an inpatient drug treatment facility. Clearly that does not seem to be a protected category for private student loans.

How You Used the Loan Matters

But wait, just because your school might have met all the requirements of a Title IV of the Higher Education Act of 1965, that doesn’t mean some or all of your private student loans are not eligible to be eliminate in bankruptcy. If your loans were used for things other than a “qualified higher education expense” the law does not protect those amounts. So if you used your private student loan money for things other than tuition, books, supplies and required equipment, that part of your student loans may be eliminated in bankruptcy today.

Private student loan bankruptcy discharge is one of those issues in the debt world that many just make the wrong assumptions about. It pays to learn more.

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This article originally appeared on Credit.com.

This article by Steve Rhode was distributed by the Personal Finance Syndication Network.