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23
Jun

Why You Should Avoid Taking Out A 401(k) Loan

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Picture courtesy of El Paso Herald

Picture courtesy of El Paso Herald

When times get tough financially, many people think that borrowing money from their 401(k) plan is a good idea that does not require a lot of effort. After all, the money in the account won’t be needed until the future, giving you plenty of time to replace it, right? Unfortunately, the situation is not as clear cut as it might appear. Taking a loan from your retirement plan can have a number of serious consequences that many people do not think about before they make their decision. Here are some reasons why you should avoid taking out a 401(k) loan.

Stringent Repayment Terms In Certain Conditions

If everything in your life continues to go as you planned, then you would probably have no problems paying back the loan according to the original loans terms. However, if you must leave your job or are fired, then the entire balance of the loan is due within 60 days or you will be hit with hefty tax and penalty fees. According to the Financial Literacy Center, more than 80% of workers who left their jobs with a 401(k) loan unpaid defaulted on that loan. Overall, one out of 10 401(k) loans are not repaid.

Lost Contributions

In many cases, people that take out a 401(k) loan reduce the amount that they contribute to their retirement account during the time that they are repaying the loan. This not only reduces the amount you are able to deposit, but also affects the amount of interest you are able to earn on the account. These lost contributions can end up costing you many thousands of dollars that you would need during your retirement years. You can’t make up the contributions you lost.

Additional Taxes

Many people do not realize that the money that they use to pay back a 401(k) loan will be taxed twice, leading them to pay more in taxes than they normally would. The money that you are returning to the account has had income taxes and other taxes taken out when it was paid to you as income. This money will be taxed again once you begin taking withdrawals from the account during your retirement years. While the interest rate offered for the 401(k) loan may be attractive compared to other loans on the market, it could end up costing you a lot more in the long run if you are not careful.

23
Jun

Things You Should Know Before Using An Online Casino

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Photograph Courtesy Of Images Of Money

In the decades since the opening of the first online casino, the casinos online have gained respectability and trust from a wide swath of consumers around the world. Rules made by governing bodies, such as The Nevada Gaming Control Board, have regulated the industry and standardized practices across the board so visitors to these websites can feel secure playing the games. It is estimated that nearly five million people around the world gamble through these casinos on a routine basis in the approximately eighty-five countries that have legalized online casinos. Here are some things you should know about using an online casino.

What Games Are Available?

Many online casinos have hundreds of different games to choose from. Most of the games that can be found at online casinos are the same as the games played in traditional casinos. Favorites include poker, blackjack, and baccarat. Online casinos also have a wide variety of slots games available, including digital versions of favorites from physical casinos and new ones that may be specific to the particular online casino you are gambling at. These games typically have fancy graphics and sound effects that make it seem like you are playing them in a physical casino instead of at home. Pay attention to the minimum bet amount before you begin to play each game to ensure that you are not spending more than you think.

 Are They Safe To Use?

Online casinos use the latest technology to ensure that your personal and payment information is secure on their websites. While no security measure is 100% foolproof, the encryption technology securing these websites are virtually the same as the technology used by banks for their online portals. Consumers must also do their part to be vigilant against the theft of their information. It is not recommended to transmit personal or payment information over open Wi-Fi networks where hackers could snag it in mid-transmission.

How Do I Receive My Winnings?

One of the biggest concerns for people that are new to using online casinos is how to receive winnings from the games that they have played. Some players win huge jackpots playing these games, so it is important that there is a secure method set up to receive the money that you have won. Many online casinos will have you set up an account where you submit information about a bank account to use for payments and collecting winnings. When you are ready, you transfer your winning directly from your casino account to your bank account. Depending on your bank’s policies, your winnings will usually be deposited into your account in 3-5 days after the authorization for the transfer.

19
Jun

Keep The Cost Of Your Gadgets Under Control

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Photograph Courtesy Of Meraj Chhaya

Photograph Courtesy Of Meraj Chhaya

Living in a digital world can get expensive quickly. In addition to the cost of new devices, many gadgets require additional services and purchases that can reach an astronomical amount before you know it. These added costs can make it difficult to keep your spending within your budget, especially if there are multiple family members using the same service plan. Here are some good ways to ensure that you are keeping the cost of your gadgets under control.

Great Discounts Can Be Found For Older Devices

If you want to get a great device, but you not want to pay a lot of money for it, opt for an older model. Older models are often heavily discounted once one or two later models in the line are released, even when the devices themselves are new. When I purchased Samsung Galaxy SII phones for myself and my son, Best Buy was having a promotion where the cost of the devices would be $1 after an instant rebate when you renewed your service contract with your provider for an additional two years. Since I had no intention of switching services in the near future, it was a no-brainer to save nearly $800 on the cost of new devices that did everything that I needed them to do.

Choose Your Service Contracts Wisely

It is important to choose service contracts that provide you with enough that you do not trigger over limit fees but not too much that you are wasting money on something that you do not need. Many people make the mistake of thinking of the cost of their service contract on a per month basis instead of on an annual basis. If the difference in price for two service contracts is $15 per month, you will spend an additional $180 per year for the more expensive contract. You will have to ask yourself whether any additions you get with the more expensive choice is worth the $180 per year you will be paying for it.

Don’t Pay For What You Can Get For Free

One of the great things about the digital age are all the apps available that can be used for entertainment or a wide variety of different tasks. Unfortunately, many of these apps come with charges that can get very expensive very quickly if you are not careful. Luckily, many of the most popular apps are free or have free versions that you can use that do many of the same things that the paid versions do. In many cases, the only difference between the free versions and the paid versions of the app are the number of ads the user sees and hears. You should also refrain from making in app purchases for games, as there are many other free games to explore if you are bored playing the free games that you have already downloaded.

19
Jun

Many Due Refunds After Buying Payment Protection Insurance

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Experts have estimated that millions of people in the UK were potentially mis-sold payment protection insurance policies. While originally designed to help people make payments on their loans and credit cards in the event of an economic hardship, the practice soon devolved into signing up every customer for the insurance, whether it would help them or not. A number of banks and lenders across the nation have been implicated in the scheme to inflate the numbers of customers paying for payment protection insurance by mis-selling the policies.

Most of these people were signed up for a payment protection insurance policy when they opened the credit card account or signed the loan agreement with the lender. However, they may not have been adequately informed about what they were being signed up for and what the insurance policy would cover. Today, the Financial Conduct Authority in the UK works to educate consumers about payment protection insurance and the legal framework that made the refunds possible for so many around the country. In March 2014, £349.8m was paid to customers who filed claims over the way they were sold payment protection insurance, raising the amount paid out since January 2011 to £14.7bn.

In some cases, the customers were actually told that they had no choice but to sign up for the insurance policy or that they stood a better chance of being approved for a loan if they had the insurance. People that were self-employed or had certain pre-existing medical conditions were not even eligible for the insurance, yet were sold policies anyway. Many people were astonished to find that the policies did not pay out as expected when they needed the help. These insurance policies were also sold under the names payment cover insurance, protection plan insurance, personal loan protection insurance, loan care insurance, and Accident, Sickness Unemployment (ASU) insurance policies.

People that believe that they have been mis-sold a payment protection insurance policy may now file a claim for compensation for the retrieval of the premium payments made for these policies. However, proving your claim can be difficult if you are not familiar with the way that the court system works to process these claims. In these cases, the customer can turn to a professional claims expert like PPI Claims Advice Line for answers to their questions and help navigating the system. The average timeframe for the entire process of filing a claim and reaching a conclusion is between 8-12 weeks.