Money Management Tips for Good Credit

Money management is a complicated thing , but revolves around the principles which seems simple is very difficult to put into practice . Good money management strategy will result in financial stability , good credit , and the ability to see into the future with ease. Here we will discuss some of the principles of simple money management and how to apply them in your life .

Keep Track of Your Credit Score

Many people seem to share the misconception that has no debts or late payments means they have a great credit score . In fact , your credit score is based on how you use your credit , so do not ever use your credit card can actually hurt your score . Instead , put the monthly bills on automatic payment plan on a credit card , then pay the bill in full each month . This will make your credit score and building active , at zero cost to you .

Recognize good vs. bad debt

There is an acceptable debt to have . An education , for example , is a strong investment that with some measures dividends paid out 15 % of the time, get yourself down to a reasonable amount of student loan debt can actually be a wise money management strategy , if you look around for cheap educational options that provide productive opportunities . Similarly , a mortgage can be a good investment in the long-term stability and equity , so do not be shy about signing a mortgage that is within your budget . Just because some people in over their heads in debt, student loans or get stuck paying the mortgage on the house when they bought above their ability , that should not deter a person from exercising prudence in the investment .

Your Debt Obligations

Too many people start to see their debt only as a fact of life , something they carry with them forever . Whether this is because they are overwhelmed by the amount of debt - it has become so large has lost all real meaning - or whether there are other factors at play , it is wise to open your eyes to your debt , to understand them and what it takes to make them disappear . Maybe you will have to adjust your spending habits , buying clothes less , eat less , get rid of unnecessary costs , even cutting down on driving to save gas . But the first priority should pull yourself out of your debt situation and to financial independence . There are many websites out there that are intended to help you educate yourself about managing money , taking advantage of the wealth of information and take your first step towards financial freedom .

Analysis of Target Corporation

TARGET CORPORATION ANALYSIS

The purpose of this memo is to evaluate Target's recent performance and compare Target's five proposed capital budgeting projects.

The first SuperTarget store opened in Omaha, Nebraska in 1995. Target differentiated itself from Wal-mart by focusing on their customer's shopping experience. The company had been highly successful at promoting its brand awareness with large advertising campaigns and as additional enhancement to the customer shopping experience, Target offered credit to qualified customers through its RED cards.

I. Target's Recent Performance Evaluation

Wal-Mart Revenue= $315.7 billion Wal-Mart Debt Rating= AA Wal-Mart Beta= 0.80

Costco Revenue= $52.9 billion Costco Debt Rating= A Costco Beta= 0.85

Target Revenue= $52.6 billion Target Debt Rating= A+ Target Beat= 1.05

Table 1: Retail Company Financial Information

Table 1 shows that Target's total revenue is the lowest as compared to Wal-mart and Costco but it performed better in relation to its company's debt management. Target's debt rating of A+ outperforms Wal-mart's or Costco's debt rating. This indicates that Target has very efficient debt management system in its company despite the fact that they need to acquire more funds to undertake their capital budgeting projects and the risk of them defaulting on their loan payments is very low. However, Target seems to be the riskiest company with a beta of 1.05 which is higher than the other two companies. I believe that Target's beta of 1.05 is not a very big issue as the total beta of the retail industry is 1.96 and Target's beta is still much lower than the overall industry's beta.

II. Target's Financial Ratios Evaluation

Net profit Margin (2005) = 6.89% (2006) = 4.58%
Return on Assets (ROA) (2005)= 5.84% (2006)= 6.88%
Return on Equity (ROE) (2005)= 24.55% (2006) = 16.95%
Asset Turnover Ratio (2005)= 1.44 (2006) = 1.50
Inventory Turnover Ratio (2005)=5.84 (2006)= 5.98

Table 2: Target's Financial Ratios

Table 2 shows that Target's net profit margin has decreased since 2005. ROE has also decreased since 2005 but ROA increased since 2005. Target's net profit margin decreased since 2005 because they decreased their interest expense in 2006. Target experienced a growth in sales and a decrease in interest expense from 2005 to 2006 which is a good sign for the company even though this resulted in a decrease in net profit margin. This decrease in net income also led to a decrease in ROE. The decrease in ROE is not a bad sign for Target as the total shareholders' equity actually increased from 2005 to 2006 which also caused the decrease in ROE. ROA improved from 2005 to 2006 which shows that management is really good at managing Target's assets to generate earnings.

Asset Turnover Ratio and Inventory Turnover Ratio improved since 2005 which indicates that Target is becoming more efficient in managing their assets and inventories. Turnover ratios are very important in the retail industry to ensure that the company is able to keep their costs low and generate significant profits. The improvement in inventory turnover for Target shows that Target is able to lower their warehouse and inventory costs in 2006 by effectively managing their inventory. This also led to the increase in sales for Target in 2006.

III. Capital Budgeting Projects Comparison

A. Gopher Place

The total population in the area in which it is located is one of the lowest among the others. There is the potential of cannibalism in that area if Target undertakes this project as there is a high density of Target stores already in that area. In addition, Wal-mart also plans to add two new supercenters there. Competition in this area will be pretty high with such a low population and so many stores. This project may not be able to generate high number of sales or profit for Target despite the huge population increase and high median income.

B. Whalen Court

It has the highest NPV due to its location in the most populated area. It will also bring the brand awareness that Target always sought for and provide free advertising to all passerby. However, the initial investment required for this project is huge and raises concerns on Target's ability to finance it. The risks associated with this project is too high as a small decrease in amount of sales will result in a huge negative NPV and losses to the company. This project may not be able to generate the high amount of sales or profit for Target as sales are expected to remain constant with a low population increase.

C. The Barn

It requires the least investment and produces a very favorable NPV. This small rural area will enable Target to expand their stores to a new market. However, it is located in an area with the second lowest total population. The median income of the population is also pretty low. Target can achieve huge profits in this area as only a small amount of sales is required to generate huge returns and Target will not encounter losses when sales decline. This project will generate huge amount of profit for Target despite the possibility that the amount of sales may be one of the lowest compared to the other projects.

D. Goldie's Square

It has the lowest NPV among all the other projects and does not look attractive from the NPV standpoint. However, it is located in a densely populated who have a high median income. A population with a high median income may result in Target acquiring many loyal customers. There is also a high population growth which indicates that sales will increase in the future. This project can generate the high amount of sales and profit for Target as growth materializes.

E. Stadium Remodel

It is located in an area with the highest median income and highest percentage of adults with 4+ years of college. Potential of sales look promising. However, there is not enough information to support this as sales has been declining previously. The outlook does not look too promising for this project. It is not a profitable project to undergo at this moment.

IV. Conclusion and Recommendation

Based on my evaluation of Target, I saw an overall improvement on Target's performance. I believe that Target will be able to earn huge profits and sales by sticking on to their marketing strategy and thorough analysis of future projects The Barn and Goldie's Square projects are the two projects that I would recommend as these are the most profitable projects among the others.

Forced To Retire

Birth control pills had not yet been invented. William Pearl hadn't been married 2 weeks before the first of his 14 children became a bun in Mama's oven. Until the day William was forced to retire from his longstanding job as Senior Clerk at Social Services he would be raising and supporting very young children.

So 35 years later when William Pearl turned 65 years old and faced the mandatory retirement, his youngest child Sam was only eleven. William, who was fit as a fiddle was not ready to be put out to pasture... he simply did not want to retire, and could not afford to retire.

The Pearl family lived on the top floor of a 5-story walk-up. The rundown tenement apartment had been home since William & Eva's first child Robert had come along years ago. Every single one of their offspring still lived in the apartment with them... even the 2 oldest who lived there with their spouses and children.

The long railroad-apartment was a beehive of activity and the only place to enjoy a brief moment of privacy was behind the locked door of the apartment's one bathroom. The 4 bedroom apartment had to accommodate 20 living, active, breathing souls... despite the fact that it was designed to house only a family of 5.

The bright, spacious living room with the crown-molding and high ceilings was William & Eva's bedroom, as well as the family den. The dining room was bedroom to the 6 youngest Pearl boys who were cozily packed against 3 walls, in bunk beds. The bedrooms off the corridor-of-a-hallway were divided up amongst everyone else.

There was lots of genuine love and warmth in the Pearl household. The cramped conditions didn't change that and may even have contributed to the great camaraderie everyone felt. It was like a small village where everyone cares for each other and gets along well.

William Pearl had no choice but to keep working so he sold greeting cards and did astrological charts for anyone interested. His pension was good. He had begun the pension plan during the years of a prosperous economy and was now assured a monetary payout plus full medical and dental coverage, for life. Fortunately, the pension covered all his basic expenses.

Unfortunately, it wasn't enough to cover everything, so working on commission, William sold his cards and books all over town. Between the commissions and astrological readings he was able to make ends meet to his satisfaction. William would never charge to do an astrological reading for you but he would accept donations. Oddly enough, he made more money that way.

William Pearl may have been forced to retire because of his age but he would never be forced to take money from his grown children if he did not have to. So he worked until the day he died. He claimed he would rather burn out than rust out.

Huge families were common once upon a time. Modern science has given us the ability to choose the size of our family now. So, in general, families like William & Eva's are rare today. Solid pension plans like William's that pay every penny of every expense are also rare. It is even rare for Americans to calculate how much they need to save for retirement... more than 50% do not.

Watching Out For Your Own Welfare

This is an incredible world full of remarkable people who have achieved great things. It is also a world which contains a lot of dishonest people and criminals who would do anything to make life miserable for their fellowmen.

Although the hope would be to engage with people who have integrity who want to do honest work and provide for themselves, there are many who would cheat, lie, and steal to get what they want. In that category of people fall those who resort to stealing another person's identity and money.

Needing money is not unusual, and most people will try to earn money honestly such as with regular employment or possibly a home based business (online work or network marketing also known as MLM or multi-level marketing) or find an extra part time job. There are many ways to earn extra money. Some people, however, are regularly committing dishonest acts against others. They are willing to try to improve their own station in life by doing criminal acts instead of working honestly to earn money.

Yet there are those who have mastered the techniques used by the perpetrators of these crimes. They do not seem to often be caught so they keep going. If they would be pursued more aggressively by the companies which may be losing money due to the fraud and law enforcement personnel who become aware of the crimes, these dishonest individuals might be deterred or caught and incarcerated.

So many people are suffering from the crimes of these criminals who are not being caught. It becomes extremely important to watch out for your own welfare. Some ways of doing it are:

• Check your credit report at least once a year
• Have fraud alerts available which alert you to unusual charges
• Check your charges online regularly
• Be careful with your credit card receipts and personal information
• Possibly sign up for a service to protect you in case someone steals your identity

Things can be going along just fine, and we may never imagine that identity theft would happen to us. We are not immune.

Restaurants and gas stations are easy targets for use of someone else's credit card if a person finds or steals a credit card. While checking her credit card charges online, Mary noticed two charges in a far away state. They were for gas and for a restaurant. She had not lost her card so she wondered how those charges could have been approved. She alerted the company that those were not her charges, and she was not held liable for them. She was told that an employee at some establishment might give the credit card number to a friend who uses it. How they can get away with such a thing in this day and age of machine approvals is still unknown. Criminal minds work in devious ways.

Being honest and working hard is admirable, and protecting oneself from those who do otherwise is smart. Being aware and watching out for yourself is important as you are on the quest to earn money and protect the money you have.

Workers Compensation Insurance - Learning The Basics

When it comes to the risks employees go through in these modern times, a great number of things could happen causing claims to occur. That's not to say that they will, but it's important to understand that there are situations that could arise where you are injured while performing everyday duties. This may seem like something that is unlikely and that won't happen to you, but it has been known to occur. This is especially true for those that are dealing with physical positions where lifting, awkward movements, and other tasks are part of everyday occurrences. For those that are dealing with the pressure of working and trying to remain on duty, it's important to understand workers compensation basics.

This type of insurance is meant to help people of all backgrounds deal with anything that could go wrong while at a job. Anything from back injuries to slips and falls, this insurance can bail you out when you need it most. While some people might be skeptical about paying for this option, it most certainly can help with a variety of things when you're injured. For instance, if you fall and you cannot return to your job at a full capacity, you can file a claim and get paid a salary while you are recuperating. This is one of the most important things to remember because if you are not able to perform duties, you may not be able to earn a paycheck to help with your bills, and more.

There is no reason why you should be healing and unable to help your family, which is why the whole concept of this insurance is crucial. Workers compensation basics should be understood by anyone that is at work in a place that could potentially be dangerous. Even if you are in a relatively safe position, paying for this option can really help when the times get tough. This is especially true if you're dealing with a chronic ailment or you need a leave of absence due to injury. You'll have to understand that the bills and other payments that you have to make will not cease because you're injured, and for that reason this can definitely save the day.

The price of this type of insurance is definitely one of varying costs. You'll have to discuss this option at length with a representative to ensure that you're getting the coverage that you need to protect yourself rom what may occur in the future. This is not something that you can pick up after the fact. Even if you feel that you're never in harms way, it's not a bad idea to at least look into this option, as it can definitely save you from unwarranted heartaches and beyond. Don't wait for an emergency or calamity to strike, look into this today and understand the basics before you spend any money. A small fee could end up saving your family's life in the future, and that's definitely worth investing in. Don't let the opportunity slip by, you'll most definitely regret it.

Direct Debit Payments a Top 5 Myths and the Truth Behind Them

Direct Debit payments are a quick, easy and popular- for over 50% of the UK bill paying population, a Direct Debit solution is their preferred payment method.

Despite their popularity, there still seem to be a few myths and misconceptions around Direct Debits, so we thought it would be interesting to highlight - and disprove - the 5 most common myths...

Myth #1 - Direct Debits are the same as Standing Orders

This product differ from Standing Orders in a number of ways. A Standing Order is for a fixed amount on a fixed date whereas this product are completely flexible, and can be for variable dates and amounts.

A Standing Order is originated (pushed) from the payer's bank, whereas a product is originated (pulled) from the organization collecting the money. Perhaps the most important fact for customers is that the payments are fully protected by the product Guarantee. A Standing Order offers no such protection.

Myth #2 - Direct Debit software is expensive

Many businesses are under the mistaken impression that the software needed to collect this payments is expensive.

The truth is quite the opposite, particularly if your solution is Cloud-based. You don't have to purchase any expensive in-house software, and you won't have to pay for installation or upgrades.

Myth #3 - Direct Debit software is difficult to install

With Cloud-based Management software, you don't need to waste any time installing or configuring hardware. The Cloud is simply remote access computing, with all the hardware and software needed sitting in a secure, external location - so you don't actually have to install anything. Your provider should take care of all that for you.

Myth #4 - Direct Debit software means lots of costly upgrades

A good Cloud-based solution will operate on a modular basis, so you only pay for what you use and can control your resources, with the ability to scale up or down on demand. For example, you shouldn't have to pay more if you want to add more payers - your annual subscription fee should cover additional payers, and allow your business to grow without any additional costs.

Myth #5 - Setting up Direct Debit Payments is time consuming

A popular misconception is that all customers have to sign a paper this Instruction, meaning that businesses have to arrange a face-to-face meeting or wait for the instruction to arrive in the post.

The Truth? Paperless the product instructions are a common sign-up method - and are much quicker than a paper approach. Instructions can be completed via the telephone, online or face-to-face.

Analysis of Tiffany and Co.

The purpose of this article is to discuss the risks of exchange rate exposures that Tiffany is facing.

Tiffany & Co was an internationally renowned retailer, designer, manufacturer and distributor of luxury goods. Tiffany was acquired by Avon Products in 1979 but was then bought back by its own management in 1984. After the company became profitable again, management offered Tiffany stock to the public in 1987 and in 1989, Mitsukoshi was the largest single institutional investor in Tiffany stock. In 1993, Tiffany concluded an agreement with its Japanese distributor, Mitsukoshi to assume management responsibilities in its wholly owned subsidiary, Tiffany & Co. Japan Inc.

I. Exchange Rate Fluctuations in 1993

Tiffany restructured its Japanese operations by selling directly to the Japanese market instead of selling to Mitsukoshi and Mitsukoshi selling it to Japan. Tiffany wanted greater control over its operations in Japan even though demand for Tiffany's products in Japan declined from 23% to 15% in 1992. However, Tiffany will still be required to pay fees of 27% of net retail sales in compensation to Mitsukoshi after this restructuring.

This change in operations exposed Tiffany directly to the exchange rate fluctuations which Mitsukoshi previously bore. Previously, Mitsukoshi ensured that Tiffany never had to worry about exchange-rate fluctuations and guaranteed a certain amount of cash flows to Tiffany in their wholesale transactions. Mitsukoshi bore the risk of any exchange-rate fluctuations that took place between the time it purchased the inventory from Tiffany and when it finally made the cash settlement.

Tiffany should be worried about the exchange rate fluctuations because the yen/dollar exchange rate is very volatile. Tiffany faced an additional risk by restructuring its Japanese operations as Mitsukoshi now no longer controls Tiffany's sales in Japan.

I believe that it is very important for Tiffany to consider the exchange rate fluctuations that it will expose itself to before it decides to assume complete control of its subsidiary store in Japan.

II. Extent of Tiffany's Exposure to Foreign Exchange Risk

• Economic Exposure

Tiffany is now exposed to foreign exchange rate risk. Tiffany has to bear the risk of any exchange-rate fluctuations that will take place when it assumes the responsibility for establishing yen retail price, holding inventory in Japan for sale, managing and funding local advertising and publicity programs and controlling local Japanese management.This may or may not decrease Tiffany's sales and income from their foreign operations. Table 1 below shows Tiffany's foreign operations performance from 1992 to 1993.

Table 1: Tiffany Co Foreign Operations ($000)

1993 Net Sales= $71,838
1994 Net Sales= $52,851

1993 Income/(loss) from operations= $2,381
1994 Income/(loss) from operations = $3,888

Table 1 clearly indicates that income from Tiffany's foreign operations decreased even though net sales increased in 1993. The additional economic exposure that Tiffany is now exposed to may decrease their income even further which will impact their net sales in the long run.

• Transaction Exposure

The restructuring of Tiffany's Japanese operations requires Tiffany to repurchase its inventory which will significantly decrease its net income. As it can be seen in Table 2 below, Tiffany is said to repurchase its inventory for $115 million in 1993.

Table 2: Tiffany Co Second Quarter Income Statements ($000)

1993 Product return for Japan realignment= ($115,000)
1992 Product return for Japan realignment= 0

1993 Net Income/Loss= ($31,513)
1992 Net Income/Loss= $6,992

However, Tiffany only managed to repurchase $52.5 million of inventory in July 1993 and Mitsukoshi agreed to accept a deferred payment on $25 million of this repurchased inventory, which was to be repaid in yen on a quarterly bases with interest of 6% per annum over the next 4.5 years. The remaining $62.5 million inventory will be repurchased throughout the period ending February 28, 1998 and payment for this warehouse will be made in yen.

The exchange rate fluctuation will definitely affect Tiffany's ability to repurchase their inventory. Besides that, this transaction exposure can also lead to major losses for Tiffany. The reduction in net income in Table 2 assumes that Tiffany actually repurchased all of their inventory by July 31, 1993. However, this assumption was not accurate and Tiffany is now only able to repurchase all of their inventory by 1998 which I believe will lead to a bigger decrease in net income as they are then required to make payment in yen from 1993 to 1998.

III. Conclusion and Recommendation

I believe that Tiffany is making the right choice by restructuring its Japanese operations. Tiffany will be able to experience huge profits by gaining more control in Japan if they plan their strategy wisely. It is important for Tiffany to hedge against the volatile exchange rates between the yen and the dollar and they can always buy options and future contracts to reduce this risk. I believe that the profits that Tiffany can earn by gaining control in Japan outweighs the exchange rate risk as this risk can be offset by hedging.

Iraqi Currency Purchase Is Definitely a Smart Move

Becoming a millionaire is a dream shared by many people. In the United States, regular folk are very keen on investing their savings and staking their retirement on good prospects. Iraqi dinar investments have been repeatedly criticized for the needless risks involved. For some, it is not worth the investment. But for believers, the risks are worth it. After all, a very huge yield awaits those who are willing and courageous enough to explore the possibilities.

It is common that people who invest aspire to the possibility that one day they will come into serious money. People who decide to Buy Iraqi Currency Online by the thousands of dollars are convinced that one day soon this now controversial currency will come into its own. Its current value is not very encouraging at all, but investors are looking far toward the future when the dinar's worth will skyrocket.

There are a number of theories currently revolving around the expected hike in the value of the currency of Iraq. But the general idea is that once the Iraqi economy is stable enough it will then be able to maximize its oil export industry. This is not baseless especially since Iraq's oil deposits are real and not mere speculation. Investors are counting on this black gold resource that is Iraq's key to a full economic recovery.

For Americans who have not put their money in commodities such as bonds and stocks or perhaps gold, they can choose to invest in foreign currency instead. The campaign to buy Iraqi currency has reached many prospectors in the United States. People who have worked their whole lives are now ready to invest their life savings for a rather prosperous future. Despite the doubts on the wisdom of this investment strategy, financial advisers are pretty confident that they are giving smart advice to dinar buyers.

A few years from now the doubters will be proven wrong. There are of course scams here and there, and the worries are justifiable. For one, investors need to be sure that they get genuine currency that can be bought legitimately. Many companies might take advantage of people's lack of knowledge on the dinar. When the economy of the Iraqi government gets the boost that the government is currently working for, the dinar's value is expected to rise. The growth of the Iraqi economy is definitely slow because it is a fact that there are elements in the country today that discourage more foreign investors to come in.

The dinar may not be the safest investment but Dinar Currency can provide the confidence that Americans who invest in foreign currencies need, especially those who are just starting out. This company is the firm to choose when someone is finally ready to invest huge amounts with high risks involved. There is needless worry with a partner such as Dinar Currency.

How to Pay Your Mortgage Off Faster

Many of us want to be untied to our mortgage. It is likely the most expensive bill you pay every month. Although the interest you pay on your mortgage is tax deductible, all that interest would be better off put away in an investment account. Even at a low interest rate, you could still end up paying hundreds of thousands of dollars over the term of your loan.

So how can one go about paying off a mortgage faster? It's all about the term, which is how long the mortgage contract lasts. The term you choose - 1, 3, 5 or 7 years or some other period - dictates the amount of interest you'll pay. Whether you choose a fixed rate or a variable rate will also affect your interest payments.

The most common term is the five-year fixed, chosen by more than 50 percent of borrowers. Even though this term is the most popular, it's not necessarily the right choice for every home buyer. The right term for you may not be the one with the lowest rate. Some terms may lock you in at a higher rate for many years, while others may subject you to fluctuating rates. Discover the other options available, as well as their benefits and disadvantages.

Four-Year Fixed Term
The difference between the rate of a five-year fixed term and a four-year fixed term will save you one-third of a percent. This may not seem like a significant amount, but when multiplied over a four-year period, you could potentially save a few hundred thousand dollars in interest - not a small amount of cash.

One-Year Fixed Term
This term results in very little financial incentive for a lender, so it's not pushed as much as over terms. However, it can be the right term for a well-qualified borrower. With rates as low as 2.39 percent, it's ideal for a homeowner with less than 15 years left on their mortgage.

Terms to Avoid
A three-year fixed term versus a four-year term save you 0.10 percent, but when you renew, the savings could be decreased by higher rates. Avoid a seven-year fixed term as well. Although it offers a few extra years of security, the higher rates don't justify it. Another term to avoid is the five-year variable term. Although there is a savings of 0.40 percent, but with no rate protection, these savings can be offset by rising rates.

Pick the Ideal Mortgage for Your Situation
The ideal mortgage for one person may not be so perfect for another home buyer. That's why there are many options available to you. Safebridge Financial Group offers a variety of mortgage options to help virtually any home buyer - even first-time buyers - purchase their dream home. Learn more about what options we offer.

Reposition Your Income And Growth Investments To Minimize Taxation

The before-tax contributions allowed for government-regulated retirement plans (such as 401(k)s and IRAs) entice many people to invest and grow a large fraction of their retirement savings within those plans. But money you eventually withdraw from them is taxed at ordinary income rates - a potentially high rate. And their required minimum distributions (RMDs) begin after you turn 701/2. How can you minimize taxation of your savings in retirement?

Generally people have two categories of accounts that hold their savings: (regular) taxable accounts (like bank and brokerage accounts) and government-regulated retirement accounts (like their IRA). The taxation of investments in each of these is fundamentally different.

All investment earnings and gains within deductible IRA-type accounts grow tax-deferred. But everything - earnings, capital gains and principal (contributions) - is taxed at ordinary income tax rates when you withdraw from them.

On the other for taxable accounts, principal (i.e. the amount you contributed or purchased to that investment) is their tax basis since you got no deduction for it: it's never taxed. But annual earnings such as dividends or interest are taxed annually. Any growth in value (capital) is taxed only on its increase, but only when it's sold, and, then, at the low capital gains tax rates if held over 1 year.

Retirees with large IRA-type savings probably have them invested in both capital growth investments and annual income-based investments. And, they also often hold CDs and other income-based investments in their taxable accounts which generate earnings taxed as ordinary income too.

When retirees must begin their IRA-type withdrawals from government savings' plans, their RMDs will be taxed at income tax rates. If their yearly income needs from savings can be met by their RMD withdrawals, it's a pity to have their taxable accounts also producing income investment-type earnings that are taxed at ordinary income rates too -and therefore pushing them possibly into higher income tax rates.

*Reposition your investments to save taxes:

Retirees can minimize this unnecessary earnings taxation in their taxable account by switching much of their CD-type investments to growth investments that carry little or no annual income earnings. Then they'll be taxed on their expected growth only when they sell them - and then only on their capital gains at their low tax rates.

At the same time, they can comparably reduce the amount of growth investments in their IRA-type accounts in favor of income investments - like those CD-type investments they had, and seek higher income-based earnings investments. Doing so, will maintain their investment 'allocations' between income and growth investments, but reduce unnecessary taxation of their taxable accounts. That way, their taxable accounts will last longer and, hopefully, grow faster.

They should maintain at least a portion of their emergency funds within the taxable accounts so they can access them - if necessary - without incurring excess taxation of 'principal'.

Traveling Abroad - Here Are Some Tips To Make Your Money Go Farther

One of the nice things about retirement is that you have the time to travel to those places you've dreamt of. And, hopefully, you've the money to get you there and back. Nevertheless, here are some tips to help make those travel dollars go farther.

-Off-season savings:

Not having to stick to your kids' vacation schedule, you can travel anytime. So you can avoid traveling during the expensive 'tourist' season. Airlines, hotels, and resorts base their prices on demand. Choose to travel 'off season' and save money.

-Airline ticket savings:

* Make your travel arrangements well in advance. Checkout the discount websites (Google 'cheap flights') for good deals. They often combine flight segments from different airlines for even lower costs.

* Always check out the round trip option to any flight you make - even if you don't intend to return using it; round trip tickets are often cheaper than the one-way ticket.

* Using connecting flights - rather than direct flights- can help you save money. Forget about the inconvenience. Remember, you're not in a rush. Make it work for you.

-Ground transportation savings:

* Some insurance and many credit cards have automatic car rental coverage for whenever you rent a car. You just have to pay with the credit card to be insured. Check yours. If so, be sure to decline the coverage the rental company's offers you - for more money.

* If you'll be traveling a lot in Europe by rail or metros, check on any multi-trip discounts. Many have passes such as a 3-day unlimited travel pass that can be a cheaper option.

* For long train rides between cities, consider taking a night train. Sleeping on the train not only saves you the cost of a hotel night, but frees up a day for sightseeing.

-Eating savings:

* Don't eat breakfast at your hotel. It's always expensive. Find an inexpensive local café and enjoy the local ambience.

* Stop into the local supermarket or grocery store to pick up snacks and fruits. Munch on those through the day. It's cheaper and healthier than expensive breaks at cafes.

* Choose one meal as your 'eating out' meal at a restaurant. Choosing it as a very early dinner or lunch, you'll save even more. Sample the local beer; it's often cheaper.

-Accommodation savings:

Always ask for discounts. But often you can choose to stay in a small town outside the city you'll visit. Small town hotels can offer a cheap alternative. Then use your rental care or the local transportation to travel to the big city.

-Entertainment savings:

Avoid the tourist traps; they're always more expensive. Go to a local pub to better observe the life and savings.

Prepare Children for a Bright Future by Teaching About Money

Being a parent requires you to teach your kids to be responsible. One thing that is often overlooked is teaching kids about money. Many parents make their finances into a secret thing rather than involving the whole family in the conversation. This can lead to a generation of children who have no clue what it means to have and use money wisely. Instead of avoiding money conversations with children, it's important for parents to make sure their kids understand money and the way credit works. Parents should even talk to kids about how to monitor credit scores so that they can track their own financial health in the future.

Introduce Money Early

In order to teach kids about money, you need to get money into their hands. Money should not be looked at as an abstract concept. Rather, parents should be sure to show kids exactly how to use it. This includes giving them an allowance, having them pay for some of their own needs, and showing them how to save. It's essential to set up a savings account for a child as soon as feasibly possible. Make a habit out of going to the bank and depositing money. Sit down with your kids and discuss how much money they have and what they plan to do with it. This practice shows them that money is a powerful thing and that you trust them to make their own decisions with it.

Teaching kids about money is a long process that needs to be a full experience. Don't just hand them some money and tell them to go shop. Model the idea of shopping by taking them with you. Simply by taking a child grocery shopping, you are teaching about adult life and what it means to be responsible with money. You should also teach kids about credit at an early age. Since credit cards and debt are such big factors in the financial lives of most people, the sooner someone is exposed, the better they should be able to handle it in the future.

Encourage Kids to Save Money

One of the best ways to teach kids about money is to set an example. If you are always suffering under mountains of debt, then surely they will do the same when they are older. Rather than spending everything you have on the nicest things, explain the importance of saving for the future. Share your savings routine with your children. For example, you could follow the ten percent savings rule. By putting away ten percent of your earnings into a special account, you can show the importance of planning for the future. Have your kids do the same thing. Offer them a small allowance until they are old enough to get a job and start earning their own income. Teach them to set aside ten percent of their allowance each week into a special savings account that you have set up for them. Every few months, show them how much money they have saved up and explain why this is important. You can also encourage them to save up for something they really want, but make sure this is in addition to the ten percent set aside. Teaching kids about money needs to be a constant fixture in your household. It's not something you can just talk about once and expect them to do. It's an ongoing learning process that is only truly accomplished through routine practice.

Explain the Importance of Credit and Credit Monitoring

With so many people in debt these days, it should be no surprise that many of these financial habits were learned behaviors from their parents. Too many people believe that credit is just a means to get things now and pay for them later. This idea leads to much irresponsible spending. Parents need to stress how much debt is too much, and they need to set the example through their own spending habits. The best way to teach kids about money is to keep them involved and have them model the spending habits themselves. Giving kids access to credit cards when they are mature enough to handle them can help them understand exactly what credit is.

Don't end the conversation about credit with how to handle a credit card. Teaching kids about money needs to be a thorough lesson that involves a discussion of credit monitoring and an explanation of how to get your credit reports. It's important for kids to understand that being responsible with money takes time and effort, and it's a lifestyle decision. If you share a credit report with them and explain the good and bad things on your credit report, they can make better decisions for themselves in the future.

All parents know that it's their job to teach their kids about many things in life. Unfortunately, not all parents understand how important money is in this equation. By teaching your kids about money from an early age, you can make sure they will be responsible with money when they are adults. These lessons about money benefit everyone involved, and reduce the possibility that you will have to help bail them out of money trouble in the future. Teaching kids about money needs to be a thorough process that involves frequent discussions, modeled behaviors, and lots of hands-on practice.

Large Mortgages Do Not Always Require A Large Income

Until the present economic downturn it was not particularly difficult to arrange a very large mortgage in comparison to your income. But we all know where that situation led us and many people are still suffering in the UK, Europe and the US from the lax lending rules that most banks and lending institutions were applying. The effect of this laxity is still being felt and is likely to be felt for some time to come.

Many young professional people who would have been able to secure a good mortgage deal pre-recession are struggling to save enough deposit to buy their first property and this lack of activity at the bottom end of the market is having an effect on the whole market (perhaps with the exception of the prime London residential property market which is being supported by overseas investors looking for a safe haven for their assets as well as a chance to sample the cultural highlights of the capital). This lack of activity on the first-time buyer front has meant that many are stuck renting properties that, ironically, they could probably afford to buy and for which the mortgage payments would be lower than their rent.

It is especially difficult to secure a mortgage from the main high-street banks and lending institutions because of their continuing stringent lending criteria such as affordability calculations and income multiples, despite government schemes to make mortgages more readily available. It is equally difficult to borrow adequate funds for a house purchase from these same lenders if you want a large mortgage, particularly one in excess of £500,000 as many institutions have that figure as their maximum lending limit.

For high net worth individuals who can finance a large mortgage there are alternatives to the high streets lenders, such as private banks but what if you want a million pound mortgage to buy that dream home but, on paper at least, your income does not appear sufficient to cover the mortgage interest?

Those same private banks and also other lenders who do not simply impose a checklist when determining affordability are often prepared to take into account other aspects of your background when deciding how much they are willing to lend as a residential mortgage. For people with other significant assets or family wealth some lenders will review the bigger picture of your ability to repay the mortgage and will not impose traditional income multiples on your ability to borrow.

Mortgages from these types of lenders are not the "self-certified" or "non-status" mortgages that many self-employed people are obliged to take out, and which are invariably on very expensive rates of interest. They are simply mortgages where the lender will take into account your full financial circumstances in deciding how much you can borrow. And if your wider financial circumstances allow then it is possible to take out a million pound mortgage or more. So obtaining a large mortgage is possible, even if your income on paper, on your tax return or on your P60 would suggest otherwise.

ew Mortgage Lenders for Top End Property Market

It has been frequently discussed in the news and other media about how the London property market is bucking the property price trend in the UK. There are a range of reasons why this should be so: the property market in the capital is seen as a stable place for investment, the value of the pound is weak and there is a limited supply of available and desirable property. Whatever the reasons for the boost in the high value residential property market in London, what is clear is that foreign buyers continue to buy.

In the wake of this surge of international buyers it is not surprising that there is also a new style of mortgage lender coming on the scene. Even the traditional high-street lenders are gradually reducing their interest rates and increasing their limits on maximum loan size in order to attract both wealthy UK buyers and also the overseas buyers.

As property prices are showing greater stability right across the country and buyers are contributing larger deposits many of these lenders are again viewing mortgages as a good bet for the first time since the start of the global economic crisis.

For those seeking large mortgages that still exceed the typical maximum loan amount of the traditional lenders i.e. those in excess of a million pounds, UK buyers can benefit from the significant number of UK-based private banks. Some of these, such as Handelsbanken and Barclays Wealth are dominating the market for large mortgages for high net worth individuals. Lenders such as these allow non-resident and non-domicile individuals to borrow a mortgage. They will take the borrower's full financial circumstances into account when deciding at what level to agree the mortgage lending. They will take a wider view of the solutions available to repay the loan such as using offshore income, background assets and limited companies. They also commonly consider high loan to value amounts with an annual repayment where this suits an individual's financial situation.

The main reason why private banks are prepared to be more flexible when it comes to mortgage lending is that they typically view the mortgage as the start of building a relationship with the client. Their longer term aim is to manage other assets and provide regular banking facilities and services to the client. So such arrangements can benefit both the private bank and the client. The client obtains a mortgage of the type and value they desire at a reasonable rate of interest (often discounted further depending on how much of their personal banking business they transfer to the private bank). And, of course, the bank benefits from all the additional services it provides.

More typically in the UK a mortgage is seen as a standalone transaction - one that could be done with any bank or building society and not necessarily with your regular bank. People looking for a mortgage would consider cost, interest rate, penalties, lending criteria and availability as more important than obtaining the mortgage from a particular lender. Indeed the high-street lending institutions encourage this approach by competing with each other on the factors that affect the customers' choice.

So the private bank approach is quite a departure from the traditional mortgage route in the UK but this full-service approach is now more and more popular with customers looking for large mortgages (typically a million pound mortgage or more). With the consequence being that there is more and more competition between this type of lender to secure the business of high net worth individuals. London mortgage brokers report sourcing loans for wealthy individuals from the traditional sources such as Switzerland and the Channel Islands, but also from lenders in Luxembourg Canada, Singapore and Dubai.

The Importance of Proper Mortgage Advice

With the UK property market continuing to show little sign of any major recovery in the near future (perhaps with the exception of the prime London property sector) it is more important than ever that any investment you make in the residential property market is a sound one; backed up by good advice. Long gone are the heady days when you could buy just about any type of property in any area of the UK and make a profit within a few years simply due to rising house prices. For those who refurbished a property the returns were even greater and in an even shorter space of time but reality has now hit home.

Or, at least, it should have. Worryingly though there are still substantial numbers of borrowers taking out bridging loans in order to secure the house they want to buy but before they have completed the sale of their old home, or even secured a buyer. In an uncertain market like the one we are currently in people should be very cautious about any sort of loan they take out but particularly one such as a bridging loan where the costs of borrowing can soon spiral out of control.

It is important that buyers view any house purchase with a long term view and do not assume that it is easy to secure a buyer for any home. Even a highly desirable home in a good location still needs to find the one buyer who is actually ready to buy and can secure the appropriate level of borrowing. Large numbers of house sales are falling through because lending criteria or personal circumstances change between an offer being accepted and a sale being completed. A reassurance that a buyer will complete is not a completed sale and only when contracts are signed can you have some certainty of the sale being finalised (although even then it is not unheard of for the transaction to fall through).

So with all this uncertainty in the market it is surprising that the Financial Services Authority (FSA) reports an increase in the number of bridging loans and the FSA is urging consumers to seek proper advice from a regulated mortgage broker to be certain they are receiving the right advice.

While the FSA is spot checking brokers arranging bridging loans many of these are for buy-to-let properties or development opportunities and as such are viewed as being commercial rather than residential lending, making it difficult for them to regulate. And, of course, there are circumstances such as investing in a buy-to-let property where a bridging loan is a useful solution to help an individual investor to complete a purchase.

Anyone considering a bridging loan should be aware of the risks involved and the potential cost implications should the period of the loan have to be extended. A typical interest rate on a bridging loan is 1 per cent per month and a typical administration fee is also 1 per cent. So, for example, on a £1 million pound mortgage the administration fee would be £10,000 and the interest payments would be £10,000 per month so every month beyond what was budgeted for could have a significant impact on overall costs of a large mortgage. Some lenders can charge up to double these typical rates and fees.

Vehicle Accident Checklist

No matter how careful a driver you are, chances are you will at some point find yourself involved in a road accident. For any accident situation the best thing you can do is be well informed, and well insured. Below are some key factors to keep in mind if you ever find yourself involved in a vehicle accident:

1: Assess the damage

Assessing damage, includes assessing damage to yourself and any passengers, not just your vehicle. You and your passenger's health should be your number one priority. If it appears that emergency treatment is required or you have any major concerns, then make sure to call for an ambulance. Do not take any risks with regards to you or your passenger's health. Remember to that not all damage may be visible, such as in the case of head trauma. If in any doubt, call for an ambulance. It is better to be safe than sorry. Next, check on your vehicle to see what damage has been caused. Then, contact the police. They will fill out a police report on the accident, which is an important requirement for your insurance claim.

2: Check for any witnesses

Take a look around for any bystanders who may have witnessed the accident take place, and request their contact details. Their testimony of the event will aid your insurance claim. Witnesses to the accident will prove particularly important if there is any insurance claim dispute. They can then be contacted for their version of the event.

3: Exchange details with any third party

If any third party is involved in the accident, make sure to exchange contact information, insurance details and your license plate numbers. Double check that you have taken down their driving license details correctly.

4: Make an insurance claim

Fill out an insurance claim with your insurance company as soon as possible. Better yet, if you have the insurance company details at hand whilst at the scene, call the company from there. Many companies provide their clients with a 24 hour claim hotline, so even if your accident happens outside of normal working hours, they will still be contactable. Of course, your insurance package will dictate what you can claim for. So make sure that you check out comprehensive car insurance comparisons to choose which insurance cover best suits you. Be aware that your insurance company will likely ask for your version of events that led to the accident, so be clear in your mind how the event took place. The best thing to do is to try write down the details of the accident as soon as you have an opportunity to do so, as your memory will still be fresh. If you are the party at fault then the other party shall make the claim against your insurance company for damages, so they will need your insurance details. In order to be well covered, consider taking out income protection insurance on top of your regular car insurance, which will cover loss of earnings if you are unable to work for any period of time due to the accident. Additional insurance may mean more outlay, but in terms of peace of mind, it is invaluable.

Procter and Gamble's Acquisition of Gillette Analysis

P&G's businesses were organized into three product based segments: household care, health, baby and family care, and beauty care. P&G became a national consumer products company with 30 brands and production facilities across the US and Canada by 1890. P&G also experienced an increase of more than 40% in their revenues between 2001 and 2005. In 2005, P&G executed its largest acquisition with the takeover of Gillette Company.

I. Reasons for P&G's Acquisition of Gillette

A) Companies have complementary strengths in product innovation and selling activities

P&G has a distribution system that is internationally spread out as compared to Gillette. Management is expected to take Gillette products into developing markets such as China that were served by P&G, but not Gillette immediately after the merger. P&G and Gillette also plan to share their R&D costs to further develop their products to better suit their customer's needs.

B) Stronger lineup of brands

Gillette was a well-known brand in the razor market and it also has a 70% market share in the global razor market. It has a strong competitive position and Gillette has been successful in persuading their customers to trade up to higher-price-point personal care items. Gillette's customers also tended to be highly loyal. Acquisition of Gillette will definitely provide a competitive edge to P&G as Gillette is will provide a stronger lineup of brands to P&G in the consumer products industry.

C) Generate additional opportunities for economies of scale

Gillette has a huge market share on its own while P&G has an internationally spread out distribution system. Combining these companies' strengths together will enable both P&G and Gillette to reduce per unit cost by achieving economies of scale.

D) Enhance relationships and bargaining power with retail buyers

The strong competitive position that Gillette has in the consumer products industry will increase the bargaining power that P&G has over its retail buyers. P&G will be able to strengthen their market position through this acquisition. A stronger brand portfolio would also definitely help enhance relationships.

II. Ways to Generate Expected Synergies

A) Layoffs

Layoffs are generally expected when a company undergoes merger and acquisitions. It is estimated that about 4% of the total combined workforce will be laid off due to this acquisition. This is to remove management overlaps due to merging operations in more than 80 countries across the world. These lay-offs will not only come from Gillette's former operations, but also Procter and Gamble's management.

B) Business Elimination

Since both Gillette and P&G are operating in the consumer goods segment, they tend to have a few products that overlap each other. Both Gillette and P&G have to sell off some of their product line to remove this overlapping and generate synergy between them. The integration of the companies' product line is important to ensure synergy exists between them and non-profitable products are removed from their product line.

III. Financial Analysis of P&G

Profit margin for P&G was pretty low from years 2000-2004. P&G experienced an increase in their profit margin after 2001. Gillette on the other hand, had a steadily increasing profit margin since 2000. They also had a higher profit margin as compared to P&G.

This indicates that Gillette's performance has been increasing steadily since 2000 and they have been experiencing increase in their sales and net earnings yearly. P&G has much higher sales and net earnings as compared to Gillette due to their internationally dispersed distribution system. However, P&G is still unable to match Gillette's profit margin performance which is higher than P&G.

The FCF productivity of P&G increased from 2000 to 2002 and then decreased from 2002 onwards. Gillette on the other hand, experienced a decline from 2000 to 2002, a short increase from 2002 to 2003 and then a decline again from 2003 onwards.

This indicates that both Gillette and P&G do not have much free cash flow in their company. However, P&G's free cash flow performance has been much better as compared to Gillette's performance. This low free cash flow may pose a problem to P&G to acquire Gillette.

P&G has much more free cash flows as compared to Gillette and this can definitely help Gillette improve their free cash flow productivity performance. However, the acquisition price offered for Gillette was $57 billion which is really high and would definitely affect P&G's free cash flow productivity performance.

IV. Conclusions and Recommendations

Even though the free cash flows may pose a problem in the acquisition of Gillette, I believe that P&G should still acquire Gillette as Gillette can definitely help improve P&G's financial performance and help provide P&G with a competitive edge in the consumer products industry. P&G will also be able to improve Gillette's free cash flow performance by their large amount of free cash flows and I believe that there will be many willing investors who would find P&G's stock very attractive during the acquisition process.

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Chloe Hung is a recent graduate from Drake University majoring in Actuarial Science and Finance. She has a strong passion for the finance and actuarial field and is constantly looking for opportunities to gain experience in these fields

Is It Easy to Make Money and Become Rich?

If you listen to the so-called gurus who are trying to sell their money-making products, it sounds extremely easy and quick to make loads of money and become filthy rich. Whether they are selling their software to earn money online using the internet or pushing newsletter subscriptions to advise people on which stocks to buy, they make it sound unbelievably simple with super fast results being likely. All you need to do is buy their products and follow their advice.

Needing money is common for most people. Although honest work with a regular job is the way for most to try to achieve their goals, it is not unusual to want to try something which promises fast returns.

Whether you are looking for a home based business which will help take the edge off the tight financial picture you are facing or you want to become wealthy beyond your wildest imagination, there seems to be a myriad of ways available to you. Whether they work or not is a different matter.

Jerry was investigating ways to earn money online so he signed up for several free offers which held big promises of wealth. All he had to do was purchase this incredibly easy to use software which would bring sales rushing to his website. He did not have a website and did not know how to get one, but the material said that they would provide everything for him so that he could start to earn money immediately. It sounded too good to be true, but it did sound believable if someone were going to help him every step of the way as indicated. He signed up and paid the money. It was very difficult to understand what to do, and he gave up on it.

If it were that easy, everyone would be rich. Some of those gurus are wealthy, but others are just struggling people who are trying to make it. It is the same when a person starts out in network marketing (MLM or multi-level marketing). Selling products is not easy without a real belief that they will be of value to the consumer. No one has success at first, but you need to act like you are successful in order to convince anyone to join you in the effort. You must rely on the success of others until you find your own.

No, it is not that easy to make money and become rich. No matter what people may tell you, it is likely going to take a super amount of effort and hard work to ever get to the point where you feel rich. It may be totally worth it for those who are willing to do what it takes.

We all know rich people, and we know that success can be achieved. If we are willing to work hard and are not too impatient by giving up too soon when success may be on the horizon, we just might become successful and rich.

How to Make Money, With Your Money! By Nathalie Martin

I am sure, like me, you keep hearing about how bad the economy is at the moment, and how poor interest rates are on savings, but how high they are on debt. Banks do not seem the safe money-keeping houses they used to be, so people are looking for better things to do with their money, and I don't blame them! Most working adults by the time they are 30 will have either just started saving, or have a substantial amount saved for a rainy day. This money at the moment seems to just be sitting there, yes it may be safe, but it is not getting bigger! I have been exploring ways to get my money working for me, and here are some of the best and most simple options I have found.

Investing money you already have is a bit of a gamble (but not gambling, I am assured), stocks and shares fluctuate depending on the market so it is not easy to predict. There is not a set limit to the amount you can start investing with, £5 a week will gradually show you a return. You can invest in stocks, where you are buying a share of the company, so you also get a share of their profits (dividends). The value of these fluctuates and does not guarantee you any return, but can potentially offer the highest out of any investment, so it is whether you want to take the risk. Or, if this is too speculative for you, bonds are the traditional alternative. There are different types (treasury, agency, corporate, depending on the institution you are buying them from) and they give you a fixed amount of interest on a fixed date. Here you are lending money to that institution, and they give you interest on that amount and eventually pay you back in full. This sounds quite scary so I have left it well alone, but as the results can be so rewarding, you may take your chances!

An ISA account is a savings account where the interest is tax exempt. You can opt for a stocks and shares ISA where you can invest your money in shares or investment funds with a limit of £11,280. Here you encounter the same risks as above, by dealing in the stock market. Or you can choose a cash ISA option which limits you to only 50% of this. Different accounts have different terms and conditions, so some may only offer you tax-exempt interest until you withdraw money, and permit you to transfer between accounts, while others do not. It is important to shop around and see which account works best for your needs. This is a valuable option if you are quite efficient with your money and know your financial stuff (this is not me!).

This is like a savings account with no regular interest, but acts as more of a lottery where every month cash prizes are drawn. You can win between £25 and £1 million, or nothing at all. This option is a bit more fun in that it's like a game, and the amount you pay in (multiples of £100 a time) stays the same regardless of how much you win, so you can withdraw it whenever you like without loss. Having had some of these for years I would recommend them as a safe option, but if you are anywhere near as unlucky as I am (I have only won £200 once in four years!), you may want to take the risk for a bigger return, or just invest as much as possible to increase your chances of a big win, without any chance of loss.

Letting a property is a big investment, but it also has a big return. Obviously it depends on just how big those savings are that you have, but with rent prices climbing very quickly you can expect a minimum of £1200 a month for a four bed house in certain areas, which is isn't bad is it! This does not necessarily have to be a huge hassle either, letting agents work as a go between for you and the tenants and it is their responsibility to manage the property, contracts and rent so you do not have to lift a finger if you do not want to! As popular as this is for many, it completely depends on just how much you have saved. For me, this one may have to wait a while!