Taxes And Borrowing Money-Might Go Hand In Hand

Wednesday, December 26th, 2012

The economy has hit a lot of people hard and left so many struggling to find enough money to cover their bills. Because of this, people all across America are waiting anxiously for their tax returns to give them just a little money to help things out. Taxes and Borrowing Money do not really go hand in hand, but if you need money now you can get a loan on your tax return to help pay off those pesky debts.

Sounds like a good deal right? Getting your tax return a little early to help out. Tons of people do it because they really need the money, but is it the right choice? While you may be desperate to get some money coming in, is borrowing from your tax return the best option? There are three main reasons why you should not borrow from your tax return and instead look for alternatives.

1: Lots of fees. When you look towards your tax refund for money, you should expect to pay a ton of fees. There are fees for just about every aspect of the loan, from the initial loan fee to a prep fee to even an electronic filing fee. If you are looking to get a couple grand out of this, when all is said and done with the fees you may only actually be getting a couple hundred.

2: Massive APR. When looking towards Taxes and Borrowing Money from your return you will have to deal with an annual percentage rate increase of anywhere from 200% to 2000%. If you are struggling for money as is, can you really afford to be shelling out all this extra cash? Odds are you are not in a position to pay that much, yet even though that may be the case, many people still do it.

3: IRS is able to withhold your refund. You are putting a lot of trust in the IRS and it is very possible that your trust can be betrayed. If the IRS has any problem whatsoever with your tax return they can hold onto your refund forcing you to be unable to pay back your loan for months. All the while you are still responsible to pay the high interest rates.

People often overpay on their taxes so that they can get a nice big lump sum at the end. They think of it as a nice reward, letting good old uncle sam hold onto their money for them. But when it comes down to the wire and you need money now, delving into your Taxes and Borrowing Money from your return may be the only option you have left. And then you are stuck with a ton of fees.

Instead of taking that route, think about saving that money next year. Instead of overpaying on your taxes for a nice return, invest that money somewhere. When the government holds onto your money it is not generating interest. If you invest wisely you can actually get more money than you put in. That can go a long way to alleviating your financial problems.

Financing A Car In A Shaky Economy – Dont Get

Tuesday, November 20th, 2012

Financing A Car In A Shaky Economy – Dont Get Trapped

There is no question that today’s economy could be doing better. However, even in this slump, financing a car probably isn’t quite as hard as you may think. In some ways, car dealers are tightening their purse strings and are more careful about lending money than they were just a few years ago. At the same time, though, their lower sales volume gives them more incentive to help people buy new cars.

But that doesn’t mean that automobile dealerships are the only place to go for financing a car. Big banks are actually not one of the best sources because of the changes they have made. On the other hand, credit unions, regional bank and other local lending institutions are all potential sources for getting car loans.

The good news about the bad economy is that it makes it a buyer’s market. Car dealers are offering various incentives and rebates to help move the inventory off their lots. Some of these incentives include low interest rates, keeping your payments lower, and reducing the overall amount you will spend over the life of your loan.

There is a catch, however. The best deals are only available to those customers with the best credit. Therefore, if you are financing a car, you should check into your credit report and correct any mistakes that may be there. Also, if you haven’t been doing so, start paying all of your bills on time. The longer you do this, the more your credit score will go up.

But don’t just take the best terms you can get at the first dealer you go to. The key is to find the best price on a car first, then go to other dealerships to get the best price and terms. See what they each offer and crunch the numbers to see which ones are best. But don’t stop there! Once you have a firm offer from one dealership, go back to a different dealership and see if they can beat the offer. Remember, they are interested in selling vehicles, and may be willing to go even lower than their previous best offer if they’re afraid you’re going to buy from a competitor.

Now there is another potential trap here, so be careful. You are not only comparing the prices of cars, you are also comparing the terms of the financing. One of the dirty little secrets of car sales is that a large portion of their profits are made on the interest rates they charge. Remember, you do not have to get a car loan through the dealership. You can go to a bank or credit union, and will usually get better rates. However, you also have to take into account any special dealer incentives that good skew the numbers back into their favor.

Another thing you can do when financing a car is to go online to compare offers from various lenders. This is convenient because instead of you going out to visit each potential lender, they come to visit you, although they do it virtually.

Financial Crisis And Help -Wake Up Call In Todays Economy

Monday, November 19th, 2012

Financial Crisis And Help -Wake Up Call In Todays Economy

If anything good has come out of this current economic downturn it is the fact that many of us have gotten a wake up call. We have learned the hard way that living beyond our means and up to our eyeballs in debt is not the best way to ensure our financial future, not to mention being able to get a good nights sleep! But the good thing is that financial crisis and help with finances are now a lot more readily available.

It’s sad but true, throughout history things haven’t gotten better until there was some sort of tragedy. Think of the lack of life boats on a cruise ship, no one bothered until the Titanic went down. The same is true today with the financial crisis and help.

Due to the economy and so many people losing their job, there are now plenty of resources where you can turn for help. If you want some information on how to get out of debt, make a budget you can live with or just become more financially educated, you can turn to many places for that help.

But if you want some actual financial assistance your options are a little harder to find and a little more limited due to the increased need. Many programs like food banks, are now stretched to the breaking point.

Personally, I think it is a good idea to start with what you already have. Instead of trying to get some money from a program that is probably running out of money, why not start to try to take better care of your finances?

Going this route, you don’t have to worry about the program running out of money. Instead you are making changes right from the source.

I have a friend who has a grown son who got behind on his student loan payments. When we started talking about it she asked me what her son could do. I told her I didn’t mean to sound insensitive but the truth is he had two choices: he could lower his debt or make more money.

That is about it. Since making more money isn’t likely at this point, he needs to spend his time finding ways to lower his debt. Many of us are in the same situation and it can seem hopeless but we might have more options than we realize.

Her son, for example, pays hundreds of dollars every month for an expensive phone and phone plan. My friend has actually gotten rid of her contract phone and is happily using a pay as you go phone. Her monthly phone bill is around $45 and her son is paying over $150 a month.

So, there are things he can do to lower his overall expenses, he just needs to be willing to do them. I’ll bet if you are really honest with yourself you can find ways to cut your expenses too.

This is one of the simplest ways to give yourself a little breathing room. The more money you free up the more money you can save or apply to paying down other debt. It will take time but you can find yourself in a much better financial situation over time.

Financial crisis and help tend to go hand in hand. It seems like the worse things get, the more help is available. Get the help you need to avert any more financial crises in your life.