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5 Car Insurance Myths That Every Driver Should Know

Most drivers think their auto insurance will cover them in an accident if they are current on their monthly premium. This is true in many cases, unless an uninsured driver hits their car – or a friend borrows the car and wrecks it. Auto insurance may not protect them from theft, either.

Without proper insurance coverage, these incidents could cost drivers a small fortune. According to estimates by the Insurance Research Council, more than 16 percent of drivers are uninsured, and state legal requirements are generally not enough to cover the entire cost of an accident. Here are five car insurance myths that every driver should know.

Myth 1: The State Requirement is All a Driver Needs
While the state requirement is all a driver legally needs, it will not cover the expenses for a serious accident. Getting by with the minimum requirement can be costly, especially for an accident that involves litigation.

Myth 2: The Driver is Responsible for an Accident
In most cases, the insurance follows the car no matter who is driving. If a driver has an accident in a borrowed car, the car’s owner must pay for the damages. If the insurance is not enough to cover the expenses, the responsibility goes to the driver involved in the accident.

Myth 3: All Insurance Policies Cover Uninsured Motorists
A basic insurance policy does not protect against uninsured motorists (UM); this coverage is an option. Moreover, drivers who have UM protection are only covered for physical injuries. Only collision insurance covers property damage caused by uninsured motorists.

Myth 4: All Insurance Policies Cover Natural Disasters and Theft
Unless a driver has comprehensive coverage, auto insurance will not pay for damages or loss due to natural disasters or theft. Most drivers do not have this optional policy, unless their car is financed by a creditor that requires it.

Myth 5: A Rental Car Requires Additional Coverage
Basic insurance policies already cover rental cars, so it is not necessary to buy additional insurance. For example, full coverage insurance on a personal car also applies to a rental if both are intended for personal use. Drivers who only carry liability insurance, however, are wise to buy additional coverage for rental cars.

Protection from loss is a crucial part of smart investing, including car insurance investments. Small monthly premiums protect assets (cars) as well as health in case of an accident. A Wilmington auto insurance representative can work with drivers to fully explain their plans and prevent overlapping coverage.

Five fundamental tips for long term investors

If are the kind of person who wants to take an active part in your investing and not let some other person do it for you, then you have to be prepared to do a few basic things to make it more likely that you are happy with your investment choices and with their performance.

Investing is a very personal choice because it is not without financial risk, but as any honest financial expert will tell you, with investing, you’ll likely gain more than you’ll lose if you make the effort to learn about your investments and make sound decisions. But at the same time, there are no guarantees, and you need to be prepared for losses and gains. You also need to be patient. Don’t expect to see a return on investments for several months, and it could take a year or more for you to see a significant return from any investments. The following five investing tips should help you get started in the world of investing, but if you have questions or specific concerns or just want some reassurance, you should definitely get in touch with a local financial advisor or an investment firm.

  1. Be prepared to spend money for stocks and other paper assets: Stocks, mutual funds, and other paper investments is one financial area where you really will have to spend money in order to make money. But it’s easy to see why this is the case: you need money to purchase these kinds of assets. Once purchased, so long as they perform well enough, your stocks will earn your money. And on that note, be prepared for even the best performing of stocks to lose on occasion. It happens to even the most conservative and frugal of investors, so don’t beat yourself up too badly if you end up investing in a stock (or even a couple of stocks) that winds up under-performing.
  2. Be patient
    Rome wasn’t built in a day, and neither is a company. Even already-running companies will need some time to take the capital they receive and convert it into a successful company. On average, it can take a company who’s selling stock six or more months to begin showing even a moderate return on the capital they received.
  3. Build a portfolio of paper assets: It’s understandable that you’d like to play it safe by going for low-risk stocks or other low-risk paper assets, but if you want to have a great portfolio that won’t let you down, mix things up a bit. Try to have about 60 percent of your shares in low-risk companies, 25 percent in moderate-risk stocks, and the remaining 15 percent in high-risk stocks. Low-risk and moderate-risk stocks will keep you balanced, while the loss from a small percentage of high-risk stocks will not hit hard – but on the other hand, gains from those high-risk stocks could certainly have a nice impact.
  4. Look beyond paper assets: While stocks, bonds, mutual funds, and other paper assets are by far the most common investment vehicles for the average person, the investing universe is a lot bigger than just paper. Starting your own business, however small, may be a great way for you to get an economic benefit from your personal skills and connections. Like paper assets, businesses both large and small have risks, so it may be best to start small so that your mistakes don’t hurt you that much.
  5. Keep learning: Once you are committed to investing, you should also be committed to learning about investing. Between the Internet and your local library, you have access to more information about investing and investments than you can possibly learn in ten lifetimes. However, you are not investing in every option under the sun, so you can easily focus your learning to those areas where you are either investing in now or plan to invest in the future. The day you think you don’t need to learn is the day that you should hire someone else to do your thinking for you.

No deposit home loans as a viable option for new homeowners in Australia

When moving out on your own, you’ll generally start out renting, perhaps renting a room in a friend’s house, sharing an apartment shared with one or more other people, or if you’re really lucky and find a good deal, a place that’s all your own. But while renting has many advantages like being able to move at any time, contract modification options, or not having responsibility for appliance repairs, there’s also something to be said for owning your own home. Home ownership is a dream for many renters, simply because home ownership, while often cheaper in the long run (and certainly more rewarding), can also be quite expensive at the offset. Typically buying a home requires that you provide a down payment on the home itself, and then there are closing costs and moving costs to consider. For many prospective buyers, home ownership winds up being delayed or put off altogether, due to the high cost of a down payment.

Fortunately for prospective home owners, there are such things as no-deposit home loans, though you’ll need to know where to look for them. It pays to let banks know right away that you want a no-deposit loan, so that if they do not have such a loan available, they can let you know right away – and thus you’ll both avoid wasting time and resources.

Banks and other lenders in Australia such as Homestart are able to provide no-deposit home loans that also have low interest rates. But despite these low rates, no-deposit loans are not always easy to find. So when you do find them, it’s important to fill out application paperwork accurately, and provide all requested documents. Saving on the cost of a down payment is a worthwhile investment, since having more money to start out with and just a monthly mortgage loan payment to make is always a good deal to have. So if you find yourself in a position of wanting to buy a home but not having savings or a personal loan from a family member or a friend to use for a down payment, do your best to seek out a no-deposit home loan.

Considerations when using a prepaid card

If you want to have the convenience of a credit card, but you can’t qualify for a regular credit card, one option is a prepaid card, sometimes known as a prepaid debit card or a stored value card. The concept is the same. It looks like a credit card, and you can use it up to some limit. Like an ATM card, you can use up to a specific amount. Depending on your bank, you may also have the ability to go over the limit on an ATM card, and maybe pay some overdraft fees. However, with a prepaid card, once you reach the limit, you can’t spend any more.

You can can get a prepaid card that looks just like a credit card, including having a Visa or MasterCard logo. They may look like credit cards, but there are a few things about them that are different, and that my make them attractive or unattractive depending on your situation.

Key things to know about prepaid cards

Whether you will want to use a prepaid card will depend on your situation. Before you use one, here are a few things to consider:

  • No bills to deal with later since you are using money you already have.
  • You don’t need a bank account to get one.
  • Your credit history doesn’t matter, you just need to have cash.
  • There is usually a fee to activate the card or to add money to it.
  • You can use it instead of cash.
  • If it is lost or stolen, it likely can’t be canceled.
  • They are accepted at most places that accept credit cards.
  • You have to keep track of how much is left on the card.

One ideal use of this kind of financial instrument is as a reloadable credit card for students, especially if the student doesn’t have experience dealing with credit cards or ATM cards, or maybe has done so in the past but has shown poor decision making.

For this kind of student, especially someone like a college freshman who is spending time away from home for the first time, a prepaid card can give a young person the convenience of a credit card with responsibility of keeping track of finances, while limiting the financial damage if they exercise poor judgment and self control.

Managing debt by expanding your assets

Previous articles have discussed various aspects of debt management, including changing one’s approach to debt. Those changes can included reducing the total amount of debt, reducing the number of debts, looking at different financing options, and understanding the difference between a positive debt that leads to long term positive financial results, and negative debt that only produces expensed and creates no benefits.

One of the golden rules of debt is related to the last distinction of a positive or a negative debt. A positive debt incudes debt that is finances an asset that produces income that exceeds the costs of debt service and the other costs associated with that asset. An investment in an apartment building that produces a positive cash flow each month is an example of a positive debt.

Another kind of positive debt would include an educational loan that allows someone to find employment that produces a higher income, even after taking the educational debt payment into account. These very same debts could become a negative debt if the investment has a negative cash flow or if the educational loan doesn’t lead to a job or a pay raise.

While managing or reducing debt can be a primary financial goal, sustainable financial stability is much more likely to happen when you have assets working for you. Your assets can range from cash in a savings account or other low-risk paper asset, or a business or real estate investment that provides a positive cash flow every month.

If you don’t have any assets at all, it is probably smartest to start with a low risk asset like a savings account or precious metals. If you are going to use some kind of paper asset, it may be best to put it into an account that is not easily accessed to keep you from being tempted to spend it quickly.

Precious metals may fit into this kind of strategy, since you can’t just take a silver bar or a gold coin 1 oz gold american eagle to the store and use it like a common currency. You have to first take it to a coin dealer and exchange it for regular money before you can spend it. Gold and silver have an additional advantage as it can be used as a hedge against currency fluctuations and inflation.

Even if your debts are far larger than your assets, having even a tiny amount of assets to your name could do wonders to make you feel better about your financial situation and your prospects for the future.

Make smarter decisions with home loan calculators

Mortgage payment calculations are based on complex mathematical formulas, and fortunately there are many options for finding calculators to make this mathematical process easy and painless.

By using a mortgage calculator, it becomes very easy to know the monthly payments you need to make, and very easy to see what happens to your payments when you change key values like the amount of the loan, the number of payments, and the interest rate.

Types of mortgage calculators
There are two different types of mortgage calculators, online calculators and traditional physical calculators that have built-in functions for computing principal and interest payments. The online mortgage calculators are mostly used by the borrowers, and real estate and mortgage professionals usually prefer using the physical ones.

You’ll need nothing more than an Internet connection to be able to access the online mortgage calculators. They are available free of cost and are very easy to operate. You’ll just need to put in the necessary information, usually the amount of the loan, the number of payments, and the interest rate.

The most common types of mortgage calculators include the following:

  • Monthly payment calculator – It helps calculate your monthly payments easily and assists you when you’re thinking of taking out loans.
  • Interest only calculator – You’ll know the amount of interest you need to pay every month. The total interest for the term can also be calculated.
  • Amortization schedule calculator – It helps you cut down your loan term by doing calculations on the principal amount and interest rate of your loan.
  • Bi-weekly payment calculator – This calculator uses an accelerated bi-weekly mortgage payment method and helps you save money. Get to know the difference between monthly and bi-weekly payments with the help of this mortgage calculator.
  • Adjustable rate calculator – Say goodbye to uncertainty with this calculator. Know about the changing interest rates and how it is going to affect your mortgage payments.

The benefits of mortgage calculators
Mortgage calculators are beneficial in several ways when you want to refinance mortgage or calculate your debt payments:

  • They let you know about your affordability.
  • They will tell you the time it will take to pay off your loan completely.
  • They will help you learn about other better payment methods.
  • They will let you choose the most cost-effective payment method.
  • They will help you get the most favorable rates on mortgage refinances.

Using a mortgage calculator prior to making any mortgage related decision is important. The calculations give you an idea about the present market conditions and how you can benefit yourself the most.

Choosing the right bank for your needs

If you grew up in the U.S. in the 1960s, the world of banking was much different than it is in the 21st century. Back then, most banking, whether business or personal, was very local, with the majority of working people, even those with high salary jobs, using savings and loan banks.

These banks made most of their money by making loans for local homes and businesses, with the amount of loans depending on the amount of deposits at the bank. If the local bank was in a relatively prosperous area, then the size of the loans and the amount of services that they offered would be quite a bit higher.

No matter how high or low the level of service, nearly all banking was face-to-face. It was very hard to do any kind of banking if there was not a branch office nearby. The idea of doing routine banking by phone was not offered for most depositors, and the concept of banking by computer only happened in science fiction.

Fast forward to 2012, and the situation is very different. While local banks and bank branches still exist, anyone in the U.S. can easily choose any bank in the country for their day-to-day transactions. You could deposit your paychecks in a Massachusetts bank, even if your job is in a nearby town. While you still may have to talk to a representative during the bank’s business hours, you can get 24 hour access to your bank online.

Where does does all these options leave the average individual or business banker? Simply put, in a very powerful position. Once you get beyond the idea that your bank has to be local, you can pick and choose the bank that works best for you.

Once you make this mental switch, you figure out ways to deal with having a non-local bank. One common tactic is to choose to bank with a credit union that allows you to use the ATMs of other credit unions without surcharge, or that may even allow you to do in-bank transactions like depositing paper checks.

Using an online database in a virtual company

Zoho Projects

Zoho Projects

The modern corporation doesn’t look much like the corporation of the last century. Back then, in order get the work done, the people doing the managing, and the people doing the work often had to meet face to face to communicate effectively.

With the development of the Internet, and more importantly the continuing reduction in the cost of the hardware and software that makes up the Internet, many of the basic administrative tasks of a company can now be outsourced to a remote labor pool at a much lower costs. Hoever, those remote workers still need to be able to share key company resources, and to do so simultaneously.

Take one small example, maintaining a basic database of customers, suppliers, products, and services. For smaller companies, this can often be done on a handful of spreadsheets or a basic database program. While it would be easy to do this on any laptop computer, when the information has to be accessible to a widely dispersed set of workers and managers, a company would need a virtual database that anyone in the company can access at any time.

One example of this kind of virtual database capability is offered by the Zoho company. Their project management software allows a company to have several users simultaneously update a database from several remote locations.

This kind of capability can even eliminate phone calls and emails. If a company also took the time and effort to develop systematic procedures for editing the database, employees from different time zones or even different continents would be able to perform their tasks without constant input from management.

For a company that intends to leverage the power of the Internet to get work done, it makes sense to design basic administrative and record-keeping tasks around this kind of online database.

Making a smartphone app isn’t as easy is it seems

In the last few months, the level of excitement in the software side of the high tech industry has reached a fever pitch at the IPO end with companies like Facebook and Groupon, and enterprise software companies like ERP software, but it has also gotten a bit crazy when it comes to much smaller scale software projects such as smartphone apps.

Whether an entrepreneur trying to make a decision about creating an app for the Android market, the iPhone market, or a web-only app, many of the problems are similar, among them are the following:

  1. It is tempting to fire first and aim later: While it may be a bit daunting to make a sophisticated app, anyone who is familiar with the basic programming to make a web site work can take on the technical challenge of writing the code for an app. The problem is that just because a programmer can create an app doesn’t mean that they know about all the things that go into creating something that people will find useful.
  2. It isn’t just a smaller screen, it is a whole new world: A smartphone screen isn’t a smaller version of desktop or laptop screen, and it is not an iPad. The average person uses a smartphone in ways that are very different from how other devices are used. The behavior of someone who graduated to a smartphone from older online access technologies. Anyone who doesn’t take the tine to really thing through what they are doing may end up with a product that works well but doesn’t work for the user because it wasn’t built to around how the user want to use it.
  3. If you don’t make a move you may get left behind: Smartphone use has taken off like a rocket, and shows no sign of slowing down. While it may encourage an entrepreneur to do something now, it may be much better in the long term to understand the overall process of creating something useful for the consumer instead of just getting something to market.

Relationship between golf technique and financial decision making

Anyone who makes an argument that understanding golf techniques can help the average person with financial decision making is either a golfer who wants to find a justification for their hobby or someone hoping to market financial education to golf fanatics. Both are true for the writer of this article.

Take the example of deciding whether to invest in a particular opportunity. One way to organize and evaluate that decision is to split it into four parts: (1) the project, (2) the financing, (3) the partners, and (4) the management. If you don’t understand one or more parts of this situation, or see a potential issue in one of these four areas, it may be very unwise to move forward.

On the golf course, with a bit of a stretch of the imagination, you can use the same model to decide whether to go out and enjoy a round of golf. Two of these areas are very easy to understand. If the financing isn’t in place (green fees, babysitter, food and beverage costs, tip for the caddy, reserve for lost bets), or if you really don’t want to golf with the other people in your party (for example a client that you can’t stand), then staying away from the links may be a good idea. Of course, if the project is attractive enough (a round a Pebble Beach, golfing with a US Senator), you may find the resources and motivation to deal with the partner and financing issues.

The hardest thing in both financial decision making and golf is management. In business, while you should have at least of basic understanding of how to manage the investment, you often have the option of evaluating an outside manager or management group to take over many and perhaps all management aspects of your investment. That option doesn’t exist in golf.

In managing one’s golf game, some things like deciding what shots to take in a particular situation is a function of experience, with the decisions often getting better over time. Other things, like golf technique, also depend on experience, but are affected by the the quality of the formal training you get, or the kinds of advice you may get, especially from an experienced golfer like Neil Haboush. As is the case with financial decision making, the best advice may not come from someone with the best textbook or theoretical knowledge, but from someone who has been out there in the middle of if all an knows from personal experience how to get out of a bad situation.

Is going to university really worth it?

There used to be a time when getting a degree from most public colleges was very affordable (sometimes with free tuition), and it helped young graduates get access the best paying jobs or professions.

Now, most students have to use one or more student loans to pay their fees, and after all that investment may graduate to a world full of job insecurity and high unemployment rates.

Many people ask the question – is university really worth it? The answer, however, depends on the circumstances of the individual, their aspirations and their access to money.

First, there are some professions where a university degree is essential. In these cases, students have no choice but to undertake further study and many will need one or more loans.

It is not unusual for medical or veterinary students to rack up debts, including student loans, of over one hundred thousand dollars during the course of their university education.

However, the status and potential earnings attached to these professions should mean that the suffering will be worthwhile eventually. In the US, doctors and veterinary surgeons are both highly paid and highly regarded professions.

Other industries also expect an undergraduate degree, such as in the legal profession. Although there are opportunities to access paralegal positions without a degree, to really have the opportunity of a high-flying career, a law degree is essential.

It is not unheard of for law companies and multinational firms in other areas to pay off the loans of graduates when they accept a job with the firm.

This fantastic opportunity only applies to the crème de la crème of candidates, however, so an outstanding academic record and evidence of potential and ambition is also needed.

Students who have difficulty with finance often take part-time work to supplement their income. However, if this is to the detriment of their studies, the end results may be less impressive.

It may be worthwhile to take some time out and build up financial resources before attending university, so that the student does not have to commit time to paid work.

There are numerous jobs, though, which do not require a university education and individuals may be better off by simply gaining work experience while earning a decent wage.

Some of the more manual professionals such as plumbers and electricians can bring significant financial rewards. Students generally gain an apprenticeship and may study at a local college to get the necessary qualifications.

Many highly paid individuals have taken this route through their working life and have built their fortunes and even empires this way, sometimes starting as a plumber, electrician, or carpenter before moving on to lucrative careers as construction managers or real estate developers.

So, university is really worth if for many people but it does depends on the individual’s professional aspirations. It is expensive but it may be essential. However, there are many ways to make a good living and that is only one route. If your talents lie elsewhere, investigate those options, as they may be just as lucrative and rewarding.

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