September 15, 2016
You can get a home loan at 10%, education loan at 11% and a car loan at 13%. But when it comes to personal loan, lenders charge a higher rate (like 16% or even more). Why personal loans attract higher interest rates?
Personal loans are unsecured form of loans. This means that lenders do not have any recourse on any security in case the borrow defaults. As a result, lenders give personal loans at higher interest rates to compensate themselves for higher default risk that they are taking.
So how do lenders decide what rate to charge from different personal loan customers?
Everything for lenders boils down to a simple concept, higher the risk, higher the interest rate. So from a borrower who is considered safe, lenders will charge lower interest rates.
There are several factors that are used to assess the risk – current income, income stability, profession, age, existing loan EMIs, past loan repayment history, etc.
So if you are in a stable job, have a good income and do not have too many existing loans, the lender will lend to you at a lower interest rate as you are considered a safe borrower with lower default risk. However, if you have too many loan EMIs and have not be regular in your repayments, then you will be considered a risky borrower and lender will increase interest rate at which personal loan will be give to you.
Your past loan repayment history, as depicted by your credit score plays a major role in your risk assessment. So if you are unsure about your perceived riskiness as a borrower, to get in touch with lenders to understand the interest rate ranges that are applicable to different types of borrowers. Once you know the possible interest rates, you can use personal loan EMI calculators to find out much you EMI will be.
, personal finance
May 1, 2016
One wouldn’t necessarily think of their clothes as a money maker, but what we wear vastly impacts our business success rate. Having a fine tuned business acumen includes knowing what to wear and when.
If you are heading to meet a new client, you want to dress to impress. As they say, you only get one chance to make a first impression. If you show up to a meeting with a potential new client horribly dressed, they will have a terrible first impression of you. You want to leave clients with the impression that you are professional, successful, and above all else, confident you can do anything the client needs you to get done.
Dressing yourself in Macy’s is gong to convey all of the right messages. If you show up to a client meeting dressed in second-hand clothes or faded and stained suits, nothing you say will be able to convince a client that you can accomplish what they need from you. Dressing in Charles Tyrwhitt however, demonstrates that you have a history of success. Showing up to a client meeting wearing the finest of clothes demonstrates to your clients that you can succeed. When you demonstrate this, you earn their trust and their account.
It might seem odd to think that how you dress can impact your financial success, but our appearance plays a large role in how we interact with others. Dressing for success is critical in business. If you dress well, you will find your list of clients expanding and your income increasing. By contrast, neglecting your appearance will only bring you frustration and hard times financially.
Make sure to take care of your business by taking care of your appearance. You need to invest in quality wear above all else- get some shoes that shine, keep your slacks crisp, and make sure your tie is on straight. Never wear the same suit twice to a meeting with a client- so make sure you keep at least four to five different sets of suits in your closet. You’ll want to be prepared at all times to let your suit do the talking for you.
, personal finance
April 20, 2016
The same health insurance policy can cost you differently at different life stages. We explain why this happens.
Taking life insurance in today’s times of uncertainty is de rigueur for any responsible person. While lifestyle diseases and serious illnesses like cancer are on the rise, the world is also witnessing unprecedented acts of terrorism and natural disasters. All in all, life is quite unsafe all over the world. But while we can exercise no control over how the world behaves and affects us, we can certainly safeguard ourselves and our families with life and health insurance policies.
However, the timing of purchase is crucial: any financial planner and insurance advisor will tell you that the younger you are when you buy life and health insurance plans in India, the lower your premium payments will be. There is a curious correlation between one’s age and how affordable or expensive the insurance plans become. This correlation changes with:
The 20s: A person has a job with a modest income, possibly a first job. The policy holder has relatively lesser family responsibilities and can easily pay the health insurance policy premiums. A person in their 20s is also healthier and fitter than his older counterparts, so the chance of disease is lower. Also, insurers estimate a larger life span for the policy holder, hence the sum assured will be higher while the premium payments will be lower.
The 30s: By this time, a person is married and has a family, while also having a stable job. His income is also higher than in the previous decade, while his health profile may not be as good as earlier. Insurers anticipate that certain lifestyle diseases like diabetes and cardiac problems take root in this decade. Also, your profession and lifestyle can have a bearing on the premiums of your health insurance policy. If you are employed in a line of work that puts you in danger (such as the police force, fire brigade, mining and construction, etc.) the insurer will insist on a higher premium payment for you.
The 40s and 50s: Premiums on health insurance plans will be much higher as compared to those a person in his 20s would pay. Insurers anticipate a lower life expectancy for the customer at this stage, along with many varied expenses at home (children’s higher education, medical treatment costs for self and parents, home mortgage payments, etc.) and so, the premiums will be larger. Insurers will also insist on a detailed health profile to eliminate the possibility of unknown diseases, critical illnesses, disorders arising out of smoking and substance abuse, etc.
The 60s: Most insurers do not give health insurance policies in India to people who have crossed the age of 60 years. People in this age group have retired from active duty, hence they do not have an income from which they can pay their health premiums. Secondly, it is costlier to insure a person past the age of 60 because of a high incidence of poor health and diseases. Instead of taking individual health plans in their 60s, people in this age group should look at getting included in the family health plans of their children.
, Health Insurance
, personal finance
March 15, 2016
In 2005, I began working with a new client. She just got divorced after over 30 years of marriage. Like many women, she had been content to allow her husband to take care of their finances. However, circumstances changed. In her late 50s, this woman found herself in uncharted waters: managing significant financial matters with zero prior experience.
While insurance, investments and financial planning have traditionally been “a man’s game,” there are many statistics that predict a different story. Women are living significantly longer than men and are more likely to become widows. Like it or not, it’s imperative for women stay on top of all things financial, for themselves and their families.
There are many aspects to financial planning: savings, retirement, day-to-day expenses, student loans, college savings, estate management, building a comprehensive stock market portfolio, life insurance, and more! It can get overwhelming trying to keeping track of every aspect of your broad financial plan. Here are four tips to get started:
1) Make it fun. Financial planning is not something that brings an immediate smile to one’s face. Try to take the stress out of it by making your conversations fun. Plan a “date night” where you cook together and go over one aspect of the finances over dinner. Don’t try to go out: restaurants are wonderful for romance, but not great for private financial conversations. Whatever it is you enjoy, try to mix that in so you can associate something positive with this new learning adventure.
2) Don’t get defensive. Your goal is to become more educated and involved in your family’s finances. This doesn’t have to be a cause for alarm or fighting! Remind whoever is currently in charge that this is not a criticism of what they have been doing. You are not going to change things overnight or perhaps even at all, so do not start out on the defensive.
3) Start with cash flow. In terms of where to start, I recommend beginning with the basics: cash flow. Where are funds currently being spent and allocated? How are new expenses prioritized? This is a good time to analyze expenses both from a high level and then more detailed. We get busy with our daily lives and while a $100/year item may not be significant—how many of them are there? Those can really add up.
4) Meet and engage with your team. Do you personally know your CPA, attorney, and financial professionals? Start to build a relationship with them. Make sure you understand how they make decisions, how they bill, and how they can help you and your partner reach your goals.
Starting the process is half the battle,and there is no wrong answer when deciding which area to approach first. Remember that this is a team effort between you and your family, spouse, or partner, so don’t try to go it alone. By following these steps,I believe you will become more empowered to make smart financial decisions in good times and in bad.
Meghann McKenna is Owner & Financial Adviser at McKenna Financial in Bozeman MT, a family owned financial firm serving clients since 1949. She also is a Registered Representative offering securities through NYLIFE Securities LLC, Member FINRA/SIPC a Licensed Insurance Agency, and a Financial Adviser offering investment advisory services through Eagle Strategies LLC, a Registered Investment Adviser. McKenna Financial is not owned or operated by Eagle Strategies LLC or its affiliates. This article is offered for general information purposes only. It does not set forth solutions to individual situations. Consult your professional advisor(s) before implementing any planning strategies. SMRU 1683868 (exp. 2.18.2018)
, financial planning
, personal finance
December 31, 2015
This world is running for money. We are struggling to earn money, doing study to get a good job to earn money. People can compromise for money; they do illegal work for this only. Because we all know that money can buy almost everything. But the above mentioned sources are limited or rather the earning money from these sources is limited. So, in this situation we are dreaming or looking for some alternative ways from where we can expect money suddenly. The volume of money in these sudden sources is not small. So, in this article I am trying to focus on those sources where we can earn money suddenly.
Sell your unused product to earn money:
Running short of money & also need to wait a long for the next month’s salary to come. What to do, here is a solution which will make you organized & also help others to get something in a cheap rate. We always have something at our home which is in unused condition means we have used that once but now those are scrap for us like our old mobile phone(workable condition), Old TV, Old music system, old furniture etc. which we can sell to others as per their requirements in a cheaper rate. Now many e-commerce sites can help us. Where we can post the image of that product & quote a price for the same. This can be viewed by multiple buyers. Here I can personally recommend OLX & Quickr.
Do financial help with higher interest rates:
Those who are in money crisis in your locality you can give them small loans with bigger interest rates. Here through interest you will get some extra money which ideally you will not get if you will deposit the same amount to some other financial organization like bank. So, in this situation you have helped that person in his crisis & also earn extra but this is a small risk because here you won’t keep any doc. In terms of prove that you have given money to this person. So, here only trust factor can work & that’s why I have mention this deal should between those people whom you know very well.
Make Gardening is your hobby to earn extra money:
We all do have some hobbies so fix something productive inform of your hobbies like Gardening. I personal feel that I am addicted in gardening & also got the same inspiration from my office garden. So, Now inform of gardening I have planted some herbal plants like tulsi, alovera etc. & many more. These plants are very valuable for the cosmetics companies. They can contact you & can pay you good amount in return of these herbal plants. Also we can sell flowers to earn money. So, here we can cherish our hobbies & also can earn good money.
Selling painting can help you earn money:
Suppose if you are good in drawing then you can paint some canvas or can prepare small wishing cards to sell. You can sit anywhere at running fair & I am sure people can give value to your creativity & also can purchase your work. The amount which you can earn here might be not huge but this is the token of appreciation of your creative part.
Other unusual ways:
Here you need to depend somehow on your luck. You can buy lottery, if you are lucky enough you can become rich in one night. There are many govt. Sponsored lottery agencies where you can purchase the luck. Or you can go to casino with your friends. Casino is a place where you can hang out & also if luck favors then after playing this game you can earn a lot of money like Mansion Casino.
Whatever the way you applied money is money but in terms of going to the uncertain way to earn money it is always better to make yourself involved in something productive from where you can earn money after every interval. That might be in terms of Job, business or some other creative work.
, Money Games
, personal finance