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The first quarter of 2012 brought grim news from the Office of National Statistics, which reported an unemployment figure of 2.6 million. A third of this figure is made up of people who have been out of work for a year or more and are therefore classed as long-term unemployed.

With such high levels of unemployment, many workers are considering more seriously the consequences of job loss. In addition to familiarising themselves with their employer’s redundancy terms and looking for areas where they can tighten their belts, many people are investigating income-protection cover as a way of providing some additional security.

What is Income-Protection Cover?

Income-protection cover pays a regular tax-free sum when you experience a loss of income due to illness or injury, with some policies also covering unemployment and redundancy. There are a number of policies available, all offering varying periods and levels of cover.

Points to Consider

It’s important to make sure you understand the full terms and conditions of a policy you are considering taking out to ensure that it is the right fit for your own circumstances. For example, some policies may only pay out for a set period of time, while others may defer payment for a few months after a claim is made.

This delay may be fine if your employer has a generous compensation plan or you have savings, but if your employment contract only covers you for the statutory minimum you may wish to seek out a policy that either pays out right away or backdates payments to the date of a claim.

Similarly, different providers will have different exclusion criteria and rules around how long a policy has to be in effect before a claim could be made. Check if there are any special rules covering self-employment or certain medical conditions in the policy you are considering.

Income protection will pay a regular sum based on a percentage of your total monthly income. This is different to other forms of insurance, such as payment-protection insurance, which only covers the repayment costs of one particular debt or purchase.

If you are made redundant and have payment-protection insurance for your mortgage you would still need to cover the rest of your living expenses either with personal savings or an income-protection policy.

A critical-illness policy will provide you with a tax-free sum if you are diagnosed with a listed illness. However, it does not pay out for every illness in the way that an income protection policy does. Consequently, if illness or health issues are of particular concern to you and your family it may be worth spending some time researching the various income-protection policies available.

Do I Need Income-Protection Cover?

When deciding whether income protection cover is the right choice for you and your family, it may be useful to look into the terms of your employer’s redundancy cover and whether your employer will pay a percentage of your salary if you are off sick indefinitely.

Look at any other insurance policies you may have and make a note of what you would be covered for and how long you would be covered if you lost your job unexpectedly. Are there any gaps and how would you fill these gaps?

Most importantly, take time to consider the various policies available, ensure your chosen policy is right for you and your family and make sure you fully understand the terms and conditions before purchasing any insurance plan.

Many people think that consolidating debts is a quick and easy way to solve their debt problems. It is easy and quick to get the loan and set it up, but there are still many dangers involved if they haven’t fully thought it through.

It happens all too often: John borrows $10,000 to consolidate his multiple credit card debts only to use his credit cards again when he feels the pinch. Before he knows it, John now has the $10k loan and a balance of $5k on his credit cards. He’s in more debt now than when he started.

To avoid this nasty debt cycle, you need to consider some important points before you make a decision. Here are the top 4 things you need assess:

• Do you spend more than you earn? A common reason for using a consolidation loan is to help with cash flow. But just like a vitamin supplement that will only help if you have a good diet to begin with, a consolidation loan will only help if your budget is cash flow positive. The worst thing you can do is take out a loan and they use your credit cards again when you feel the pinch.

• Can you afford the repayments? This comes after you consider your budget and based on that analysis, can you afford to repay the loan comfortably? The whole point of debt consolidation is to make the payment slighter lower and more affordable. If this isn’t the case, or you may struggle to meet the payments each month then you might need to look for another solution – like a debt management plan, for example.

• How long will the loan last? Sometimes, consolidating your debts to a lower monthly amount means you will pay for longer. This might be a positive if it means you aren’t struggling every month, but you need to be aware that you will be in debt for longer whereas most people are trying to get out of debt as soon as possible.

• How much will you repay in total? Another effect of paying the loan for longer is that the total repayment might be more than it would have been if you continued paying the previous amount. This might not be the case if you had high interest credit cards, and it gives you the more affordable repayment you might need, but you need to be aware that you might pay back more with a consolidation loan because it is taken over a longer period.

Hopefully these points will give you more information about whether a consolidation loan is right for your situation and you will know exactly what you’re signing up for.

They can be an excellent debt relief tool when used appropriately but many people think they are a magic bullet and get a nasty shock when they don’t change their spending habits or thinking and end up further in debt.

If you’ve taken out a consolidation loan in the past, share your experience with us in the comments below.

Are you a Bull or a Bear? If you are a sports fan you may think I am talking about either of the professional sports teams in Chicago, but you would be wrong! What I am actually referring to is the type of investor you are when it comes to investing in the financial markets. For those of you that don’t know, the financial markets are classed as being either a bear market or a bull market, depending on the current economic state. A bear market occurs when there is a steady decline in the stock market and investors are less confident about future prospects of stocks causing their prices to continue declining. A bull market occurs when the opposite is happening, investor optimism and confidence would be high and the stock market in general would be on an incline/resurgence with prices steadily rising.

At this current moment the world financial markets are definitely in what can be classed as a bear market, as stock prices are low and investor confidence is at an all-time low. This of course is because of the global recession that we are currently facing, which appears as If it will remain this way for the near future. Investors are really suffering because of this, as all but the sharpest and most diligent investors have pulled out of the markets and have turned to saving. This lack of confidence in the markets has spread to include prospective investors, some who have never even traded stocks before, many of them are busy looking for alternative methods of investing so than can make their money grow. The trouble with this is that the percentages currently being offered as a return on investment are so low that most end up leaving their money with their banks as the interest rates are often similar to what is being offered alternatively.

Now this is not to say that there is no money to be made in the financial markets, as there are still many investors making excellent returns daily! In fact some investors would tell you that investing now while the market is ‘bearish’ is a very smart move, which makes sense if you think about it. You see at the moment stock prices are really low and now would be the perfect time to capitalise on it. Say for instance you were looking for a long term investment; all you would have to do is research some into established companies that have relatively low stock prices, once you are satisfied that you have found the right company, purchase some of their stocks and wait. The key here is patience, as your stock might drop below the value you initially paid for it but rest assured that once we get out of this recession and the stocks start performing normally, you should make some significant profit! I can’t stress enough how important being patient is within a bear market, as the best returns can be had by keeping hold of stock that successfully makes the transition from a bear to a bull market.

This however is not the only way to make money in a bear market. A prospective investor can also start doing financial spread betting with one of the leading companies, such as Cantor Index by short selling to make profit on their investments during a bear market. This would be where you make a short term prediction/bet as to the way in which a stock/market will go, for example you can bet that a particular stock will continue falling in price and if it does you will make money however if it rises you stand to lose more than you bet initially.

Here are three tips to help you be successful in the stock market;

1. Research; The most important factor, you have to do thorough research before investing. Make sure you have sufficient knowledge of the markets before risking any of your money.

2. Split up your investments. Do not attempt to use all your investment funds to purchase one stock, as you might have predicted wrong, and your investment can become worthless quickly. Many positive returns from many small investments are better than no return from one investment.

3. Try not to sell unless necessary. Keep hold of stocks as long as you financially can whether they are performing or not. Try to set cut-off limits, so that you will have predetermined the level of profit or loss that you would be comfortable leaving the market with.

It didn’t take long for social networking to hit the financial world in a meaningful way. No, it’s not a new app for your smartphone that lets you take a picture of a check and then deposit it into your bank account. As cool as that is, SmartyPig is at least twice as cool. Read on for proof.

What is SmartyPig?

SmartyPig (smartypig.com) is a goal-oriented internet-based savings account fully protected by the Federal Deposit Insurance Corporation (FDIC) just like the savings account at your local bank. What differentiates a SmartyPig savings account from traditional savings accounts is the unique social networking component attached to each account.

Set a goal for yourself

Aren’t all savings accounts goal-oriented? Sure, but not in the same manner as a SmartyPig savings account. When you setup a SmartyPig account you immediately identify a goal for the money. Want a new laptop computer? Make that the goal. Want to take a holiday cruise? Then that’s your goal.

After your savings goal has been identified, simply enter in the amount of your goal and the day you want to reach it.

Social Networking

What makes the SmartyPig savings accounts a zillion times more fun than a traditional savings account is that you get to share your goal with all your friends on Facebook! Just try and pretend that isn’t awesome.

But the Facebook fun doesn’t end there. Not only can your friends share in your goal by encouraging you to stay on track to achieve your goal, they can also contribute to your financial success. Just imagine 1,000 of your closest friends each contributing just one dollar each to your success. Okay, it’s probably not quite that easy, but you get the gist of how the social networking component works.

Retail Partners

Another exciting part of a SmartyPig savings account is the retailer shops that have jumped on board with cash-back savings of up to 11% on purchases, and it’s no small number of stores. Here’s a partial list:

* Amazon.com (3%)
* Banana Republic (10%)
* Gap (10%)
* Macy’s (11%)
* Old Navy (5%)
* Sports Authority (5%)
* Travelocity Hotel Gift Card (10%)

Here’s how this program works. Let’s say you have saved $1,000, reaching your goal for a vacation. When you transfer that money, as an example, to a Travelocity Hotel Gift Card you instantly get an additional 10 percent—$100 dollars—added to the gift card. That’s $1,100 to put towards your hotel. Sweet, right? Of course it is.

Interest Account

To top off everything you’ve read so far about SmartyPig savings accounts, they also pay a very competitive annual yield of 0.70% on any balance below $50,000. Accounts exceeding $50,000 earn an annual yield of 0.50%, making SmartyPig savings accounts among the most competitive in the industry.

So, what are you waiting for? Do you have a financial goal that could really get exciting with SmartyPig, your friends on Facebook, and cash back from great retail partners? Visit smartypig.com for all the details and set a plan into motion to reach your goals.

Are you looking for ways to make your dollar go further? Staying on a budget can be difficult if you’re not sure where to start. Try following these 5 easy ways to help you manage or lower your expenses.

1) Buy generic brands

Grocery stores usually offer a store brand or a generic brand that costs less than name brands. Pharmacies also offer generic versions of most medications that tend to be far less expensive. It’s also important to avoid shopping on an empty stomach. If you do, anything and everything will look delicious. You’ll throw out that budget you had in mind along with your will power to resist that chocolate cake in the bakery. So, eat before you go to the grocery store and stick to your list!

2) Carpool

With rising gas prices, who wants to pay so much to drive to and from work every day? Find someone you work with who lives close enough to you that you can carpool. Carpooling will save you money on gas, allow you to use the HOV lane, and give you time to catch up on water cooler gossip before you get to the office. If you have no options for carpool buddies, you can use public transportation or even consider moving closer to work to shorten your commute.

3) Pay off credit cards

Pay off your credit card with the highest interest rate first. It is imperative that you make your payments on time. Late payments can lead to a nightmare of late fees, increased interest rates, and seeing that dreaded decrease in credit score. It is a good idea to make a separate calendar just for bills and their due dates to avoid missing payments. You will never have to incur late fees because you simply forgot to pay the bill.

4) Pay yourself first

A wise man (my dad) once told me that the most important bill to pay is – you. All you have to do is budget a certain amount of money from every paycheck and essentially “pay” yourself. This money should go into your savings account. You’re continually adding a fixed amount to your savings and growing your emergency fund a little at a time.

5) Take advantage of free offers

There are free and discounted offers all over the Internet, you just have to find them. For instance, if you type in “pizza hut promo code,” you’re likely to find a coupon for a few bucks off your pizza. You can also sign up for newsletters from your favorite online stores. You’ll get emailed frequently with discounted offers. There are also tons of online coupon sites. If you’ve ever seen the television show “Extreme Couponing” you know just how much coupons can save you. There you have it! Try these 5 simple ways to stretch your dollar. Remember, creating and managing a budget plays a crucial role in your financial health. Don’t let the process overwhelm you. Simply pick a place to start and go from there.