Sammarusich Blog » Home financing

Home Improvement Finance

admin — Sun, 13 Feb 2011 03:32:22 +0000

Doing a project that improves the quality of your home is a wise decision and a wise investment as well. Not only will it make your home more comfortable and beautiful, it will increase you home’s value as well -that is of course if you plan to sell it. Improving your home will raise neighborhood standards, because of the home improvement; the value of your property goes up. If you ask an economist, these type of improvements mean a lot of things. One is that it will increase the sales for home products and materials needed for home improvement and in effect, you will be helping your community’s economy by improving your home. Home improvements will also yield jobs since you will need a contractor, carpenters, plumbers, etc.

If you want to do some work on your home, there is such a thing as home improvement finance. This is not just a one-time agreement with a finance firm but it will cover future repairs and renovations if in case you will need financing again. This is of course an easy decision to make because year after year, you find things that need to be repaired in your home. Well there is no need to worry because financing for these types of improvements to your home are here to stay, and to assist you in getting those projects started. In fact, you can use home improvement finance to add one more room into your home, put in a bigger pool in your backyard, or for remodeling. You can even use the finance to make your home more energy efficient i.e. installing solar panels to save on electricity.

Financing for household improvements are generally home equity loans that allow you to tap into your home’s equity for cash by applying for household projects or renovations. Getting home improvement finance is better than other types of loans because the rates are lower and offer better terms for you. It gives you the flexibility to pay expenses that are recurring and the best thing about it is that there is no application fee (for at least most of the home improvement finance agencies in the US).

2011: Traditional Personal Finance Revisited

admin — Fri, 11 Feb 2011 19:09:32 +0000

“We’re not in Kansas anymore, Toto” Dorothy said in the Wizard of Oz; which pretty much sums up my view of life in America, 2011.

So what to do?

The “new normal” means we each have an opportunity to start from where we are to create successful future outcomes from this moment on. That is, if we choose to release mainstream media’s “normalcy bias” perfected over generations to perpetuate (no matter what) the illusion of normalcy!

Central to the normalcy illusion is a consumption-based definition of success designed to override concerns in a shifting economic landscape. Yet all around us hard evidence virtually screams the naked truth of the many ways the “normal” we once knew, no longer exists.

Below are my personal-finance recommendations that dovetail but do not exactly match those of traditional advisers. Why? Traditional recommendations typically ignore the risk factor represented by how money works in context of its monetary system. Same as with health issues; without knowledge of the cause of symptoms, treatments generally lack full effectiveness.

When it come to personal-finance success, responsibility for how we earn, spend, save and invest is obviously essential. However, financial objectives can easily elude us if we lack the whole story about money. The missing piece is systemic in nature. Overlooked and under reported, impersonal monetary-system mechanics grind away to leave families vulnerable; undermining goals of stability and wealth-building.

Also known as a hidden tax. Who benefits?

Central banks worldwide (Federal Reserve for the U.S.) issue currency at the precise moment it is borrowed via an automated procedure called fractional-reserve banking. Therefore, money is actually a debt instrument (Federal Reserve Note). This private profit, interest-delivering system was designed centuries ago.

Over time debt grows per compounding interest and purchasing power diminishes with increased cost of living. The cost of living rises as businesses add their interest cost from bank loans to the cost of the goods and services we purchase.

And so grows the gap between the haves and have-nots.

That brings me to the pivotal issue of how much purchasing power $1.00 has in the marketplace today. One dollar is only worth 4.5 cents and an online inflation calculator proves my point. An item purchased for $1.00 in 1913 (when the Federal Reserve System was created) would cost $22.10 in 2010; a 2000% increase in inflation!

It’s a fact: Skilled advisers are definitely helping families lower their debt-loads and modify their budgets. That said, the “good-debt, bad-debt” conversation remains as conventional truth; leading individuals and families to believe they can tweak their budget and lifestyle here and there to make it through to better days.

Unfortunately, such household gains may not last. Without a working knowledge of money as debt, even the most sincere efforts may falter as a rising cost of living erodes hard-won forward movement. When following conventional financial wisdom, the solution to keeping up and making ends meet could well end up, once again, as participation in the vicious cycle of credit and debt. Who benefits?

More choices with the big picture.

When we add the missing-piece about money to our knowledge-base and decision-making process we also gain additional financial strategies. Those who set out to explore alternatives outside-the-traditional-personal-finance-box tend to develop a new part of their brain.They uncover a world of possibilities (perhaps previously under-valued) along with the thousands of others on the very same mission!

Here are my personal finance action-steps formulated to help individuals and families build a solid financial foundation. Savings and investments are very important but in the 2011 economy they will be most SUSTAINABLE when a solid present-day foundation has been attended to first. You’ll know you have completed the “foundation” step once you have more money coming in to your household than going out for at least four consecutive months!

Write down your short-term, mid-term, and long-term financial goals and put them somewhere to easily refer back to them. Review your goals (at least) on a weekly basis. Figure out your exact financial status today. How much money a) comes in and b) goes out each month. Create a line-item and categorized itemization of money in and out. Don’t forget things like eating out and entertainment. Track your expenses and out-of-pocket spending precisely for at least one month. Save all receipts and record out-of-pocket information daily. Also determine the exact amount of money (or average) that comes in each month. Do you have more money going out than coming in? If so, exactly how much? Use your list of current itemized expenses to create an action-plan regarding how and by when you will lower or eliminate line-items that exceed the amount of money currently coming in to your household. This may mean creative downsizing. Create an action-plan about how and by when you will increase money coming in to your household. As debt becomes reduced or eliminated, this action step becomes the most important one in order to stay ahead of the cost-of-living debt curve for the long-term. As you focus on ways to increase cash flow, perhaps consider an independent trade or service that people will always need and that best suits you. For example, car mechanics, computer techs, hair stylists, barbers, clean-water suppliers, pet care-givers, delivery-service providers etc. Make debt-elimination a high-priority; the final goal being to consistently live within your means and pay as you go. Once credit-card debt is paid off, get rid of all but one credit card because credit access is actually an instant-gratification state-of-mind. Do NOT keep your one remaining credit card in your wallet. Leave it frozen in a bowel of water in your freezer. This tactic builds time into the otherwise instant-gratification decision-making mindset of a credit card in your wallet. You might even want to reallocate existing assets towards building your “more money in than going out” household-budget foundation more quickly. Since money (as debt) is worth the most today than it will be tomorrow, it’s best to put it to work today! A stable present situation will increase your well-being. Increased well-being empowers a healthy decision-making process Use cash first and foremost. Most people will pay more attention to what they spend when it comes straight out of their wallet. Stop shopping for entertainment. Shop purposefully using coupons, during sales and buy bulk whenever possible. Generally shop recycled including for cars. Include your children in the how and why of your decision-making process (should you accept this mission)and invite their imitation of your thinking and efforts. If you have savings and/or investments to preserve, keep some of YOUR money entirely out of the reach of the banking-services industry. They consider their own interests before they consider yours! More and more people are moving their bank capital into hard (tangible) assets. Specifically per 16 above, consider anything you have in savings, retirement funds or the stock market. (Remember the stock-market 2008 and FYI: The U.S. government is currently floating the idea of nationalizing 401(k)’s and IRA’s given their nearly 14-trillion-dollar deficit. In other words, individuals would lose control over their account and the government instead would ration annuity-type payments.)

2011: Hope or Despair (Part 2)

admin — Tue, 08 Feb 2011 23:58:08 +0000

Are some people immune to the recession?

Not everyone is affected by the recession. Some people are lucky enough to be recession-proof. According to George Orwell, in his book “Animal Farm”: “All animals are equal, but some animals are more equal than others.”

To single out Premiership footballers, I am sure Manchester United’s Wayne Rooney and Manchester City’s Carlos Tevez are smiling like Cheshire cats having recently signed new contracts after successfully holding their clubs to ransom over their intentions to leave.

Furthermore, I am sure we all remember the recent remark of Tory grandee, Lord Young, that most Britons “have never had it so good.” Of course, there is no doubt about what side of the divide Lord Young happens to be perched on.

On a philosophical note, life may not be the party we hoped for, but while we are here we might as well dance.

Tips for getting value for money from expenditure during these desperate times

Don’t be afraid to haggle when you are out shopping. For most of us, haggling is something we engage only in when holidaying abroad – mostly in developing countries. However, given the current economic climate in the UK and retailers being at the mercy of the consumers, some retailers will extend discounts to customers on request.

Local markets are a good place to get value for money. You will save a significant amount of money doing your grocery and meat shopping at a local market compared to a big chain store. Don’t forget your haggling skills.

Utility bills are next. Remember to check your gas and electricity bills to make sure you are on the right tariff. If you are not sure of your tariff, call your provider to find out. Chances are that you are on the most expensive tariff, just like I was for the last six years before I changed it.

Try and get into a habit of reviewing your bank statements on a monthly basis. Apart from staying on top of your cash flow, it is important that you highlight and query any unexplained bank charges or transactions posted to your account. Contrary to what some people think, the banks do get it wrong sometimes.

I wish you all a very prosperous 2011. God willing, we will all succeed in keeping the wolf from the door over the coming months.

2011 Tax Deduction for Homeowners – 4 Tips for 2011 Homeowner Tax Deduction

admin — Sun, 06 Feb 2011 10:29:36 +0000

2011 Tax Deduction for Homeowners is a great way to save money in year 2011. If a taxpayer understands the benefits of home ownership they might decide to own a home instead of continuously paying down payment to a rental apartment.

If you own a house, here’s the steps on how to claim maximum Tax deduction for homeowners in 2011.

The deductions can be made by reducing the real estate taxes you paid in accordance to the assessment value of your property and if the local government has similar rating to its value.The public must have gained benefits from taxes they paid and not only for individuals or community. Whenever you have first or second homeowner mortgage, home equity loan, and home improvement loan in 2011 you can deduct from taxes all the interest you paid for this loan as long you are using this home as your main or secondary residence. Never deduct payments you have made from your real estate escrow account because your lender can present annual information of your payments that can show the actual amount you paid for it and can deduct to your federal income taxes. This is important point you must remember when doing Homeowner Deductions from your 2011 Tax return. A lot of people make this mistake. In the event you bought a house you can transfer all taxes you have paid and add it to its cost basis. This is the item that cannot be deducted to your taxable income.

To claim your Tax Deductions as a Homeowner in 2011, be diligent when filing.