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Posted by Alan Chokov
Tax lien certificates can make a great investment. Many people want to invest in tax lien certificates but stop themselves because they think that they need to go to the live auction to do it. Yes, it's entirely true. The most common place to invest in tax lien certificates is at the live annual auction. The auction varies by state and even county, so check with your local county tax collector to see when they have their auction. Can I let you in on a little secret? I have been investing in tax liens for several years now and have NEVER been to a live auction. How can that be, you ask? Easy! I invest in Over The Counter certificates (OTC).So, what is an OTC certificate and how can you profit from it? An Over The Counter certificate is one that did not sell at the live auction. In many states, when the certificate does not sell, it is "struck off" to the county. The county simply has a list in their office and you just call them up and get it. Then, you do some research, pick out the ones you want and get the lien without any traveling or hassles.Just because you can buy tax certificates Over The Counter, should you? Well, maybe and maybe not. Remember that in most cases, Over The Counter certificates are liens that did not sell at the regular tax sale. So, there are some precautions that you should take to make sure that you are getting a good deal.First of all, start with counties that have websites. Luckily, nowadays it is very easy to find a county with a good property research website. Then, you simply enter the parcel number into the website and it will tell you what is there, and how much it's worth. Ideally, you want to find properties that have a structure already on them, but it's not always easy to find. Next, you need to see the total taxes due from all years and compare that to the tax valuation. The reason you need to know this is that in the event of a foreclosure, you will need to pay off all the back taxes. The worst thing is to find out that there are more due in back taxes than the property is worth.Once, you find that out, then copy down the legal description and call the local Realtor. Tell them that you are planning on investing in a certain property and may eventually need their services to resell it. I have never had a Realtor not give me an honest opinion of an area. Many times, they tell me NOT TO BUY there and that's ok too. It's better to find out now than to find out when it's too late. And there you have it! With proper planning, you too can be an armchair investor. eFinance Portal of New Jersey, www.efpnj.com
Monday, January 25, 2010
Many Americans Lack Basic Financial Concepts
http://www.efinanceportal.com/efp/alancommentardetails.do?orderId=30803&industryId=17&languageCode=en
Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com - So you think you're good at dealing with day-to-day financial matters. Seventy-five percent of Americans say they are, 77 percent say they're pretty good at math and 70 percent rate their financial knowledge as high.But Americans, including many who give themselves high marks on math and finances, make common mistakes that cost them a bundle in needless charges, penalties and fees. They also have trouble answering five simple questions:1) Suppose you have $100 in a savings account earning 2 percent interest a year. After five years, would you have more than $102, exactly $102, or less than $102?2) Imagine that the interest rate on your savings account is 1 percent a year and inflation is 2 percent a year. After one year, would the money in the account buy more than it does today, exactly the same or less than today?3) If interest rates rise, what will typically happen to bond prices? Rise, fall, stay the same, or is there no relationship?4) True or false: A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage but the total interest over the life will be less.5) True or false: Buying a single company's stock usually provides a safer return than a stock mutual fund.These questions were part of a "National Financial Capability Study" commissioned by the FINRA Investor Education Foundation (FINRA stands for Financial Industry Regulatory Authority). The correct answers, and the percentage of Americans who got them right are: 1) More than $102, 65 percent; 2) Less than today, 64 percent; 3) Fall, 21 percent; 4) True, 70 percent and 5) False, 52 percent.This translates to an average of just 2.72 correct answers out of five (and some correct answers may have been lucky guesses). If you are good at math, you can figure out that's a score of just 54.4 percent, or an "F" on a typical grading scale."Many respondents had difficulty with basic financial concepts," concludes the FINRA study, based on a telephone survey of 1,488 Americans 18 and over.FINRA's survey was developed in consultation with the U.S. Department of the Treasury and the President's Advisory Council on Financial Literacy. By exploring how people manage their resources and how they make financial decisions, the FINRA Foundation and others can best extend the reach of financial education programs in communities across the country.The need is enormous. Survey results were discouraging in four key components of financial capability: making ends meet, planning ahead, managing financial products, and financial knowledge and decision-making.Nearly half of survey respondents reported difficulties in covering monthly expenses. Most lack a "rainy day" fund for emergencies and do not plan for predictable events, such as their children's college education or their own retirement.More than one in five Americans reported engaging in expensive non-bank borrowing methods such as payday loans, advances on tax refunds or pawnshops. Even among those who said they were good with finances, many bounced checks and were late with credit card payments, among other things.Few compared the terms of financial products or shopped around.One in 10 people with a mortgage did not know the interest rate they are paying and 17 percent of investors in retirement plans did not know how much of their portfolio is in stocks or stock mutual funds. Regarding investments for retirement, "it is difficult to distinguish accurate responses...from guesses and misstatements," the study said. For the full report, see Web site www.finrafoundation.org/capability.Humberto Cruz contributed to this article
Alan Chokov, eFinance Portal of New Jersey, www.efpnj.com - So you think you're good at dealing with day-to-day financial matters. Seventy-five percent of Americans say they are, 77 percent say they're pretty good at math and 70 percent rate their financial knowledge as high.But Americans, including many who give themselves high marks on math and finances, make common mistakes that cost them a bundle in needless charges, penalties and fees. They also have trouble answering five simple questions:1) Suppose you have $100 in a savings account earning 2 percent interest a year. After five years, would you have more than $102, exactly $102, or less than $102?2) Imagine that the interest rate on your savings account is 1 percent a year and inflation is 2 percent a year. After one year, would the money in the account buy more than it does today, exactly the same or less than today?3) If interest rates rise, what will typically happen to bond prices? Rise, fall, stay the same, or is there no relationship?4) True or false: A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage but the total interest over the life will be less.5) True or false: Buying a single company's stock usually provides a safer return than a stock mutual fund.These questions were part of a "National Financial Capability Study" commissioned by the FINRA Investor Education Foundation (FINRA stands for Financial Industry Regulatory Authority). The correct answers, and the percentage of Americans who got them right are: 1) More than $102, 65 percent; 2) Less than today, 64 percent; 3) Fall, 21 percent; 4) True, 70 percent and 5) False, 52 percent.This translates to an average of just 2.72 correct answers out of five (and some correct answers may have been lucky guesses). If you are good at math, you can figure out that's a score of just 54.4 percent, or an "F" on a typical grading scale."Many respondents had difficulty with basic financial concepts," concludes the FINRA study, based on a telephone survey of 1,488 Americans 18 and over.FINRA's survey was developed in consultation with the U.S. Department of the Treasury and the President's Advisory Council on Financial Literacy. By exploring how people manage their resources and how they make financial decisions, the FINRA Foundation and others can best extend the reach of financial education programs in communities across the country.The need is enormous. Survey results were discouraging in four key components of financial capability: making ends meet, planning ahead, managing financial products, and financial knowledge and decision-making.Nearly half of survey respondents reported difficulties in covering monthly expenses. Most lack a "rainy day" fund for emergencies and do not plan for predictable events, such as their children's college education or their own retirement.More than one in five Americans reported engaging in expensive non-bank borrowing methods such as payday loans, advances on tax refunds or pawnshops. Even among those who said they were good with finances, many bounced checks and were late with credit card payments, among other things.Few compared the terms of financial products or shopped around.One in 10 people with a mortgage did not know the interest rate they are paying and 17 percent of investors in retirement plans did not know how much of their portfolio is in stocks or stock mutual funds. Regarding investments for retirement, "it is difficult to distinguish accurate responses...from guesses and misstatements," the study said. For the full report, see Web site www.finrafoundation.org/capability.Humberto Cruz contributed to this article
Helping teach financial literacy to students
http://www.efinanceportal.com/efp/alancommentardetails.do?orderId=30673&industryId=17&languageCode=en
Posted by Alan Chokov - Students are heading back to school after the holidays, eager to pursue good grades, activities that will boost their resumes and that elusive summer job. Now is the time for parents to reflect upon their own contributions to family and community. Even when it seems like we all have less time, this spring may be a good time to assess opportunities to volunteer.
According to the U.S. Department of Labor, 26.4 percent of Americans volunteered in 2008. While that shows a significant number of people making an effort to give back, it also reveals that three quarters of our citizens are not volunteering.
What better way to help shape our nation's future than by personally investing in our children's education?
As students focus on their studies, there are a few subjects that most of them won't be taught: How to manage money; how to create a budget and balance a checkbook; how to avoid credit debt; how to get ready for a job in the real world.
The basics of money management what we call financial literacy are essential life skills. Few would disagree that better financial decision-making could have lessened the negative consequences of the current recession for many families.
Managing money needs to be taught early, before students head off to college or enter the workforce. Ten percent of 2008 college graduates left school owing $40,000 in educational loans, according to U.S. News & World Report. Credit card debt also is increasing. A 2009 Sallie Mae study reports students graduated with 41 percent more credit card debt than four years ago, with one in five owing at least $7,000 and 82 percent unable to pay the monthly balance in full.
More bad news is that current graduates face the toughest job market in years. A recent National Association of Colleges and Employers survey found that only 20 percent of 2009 graduates who applied for jobs have been hired.
Parents should consider volunteering to teach a financial literacy program that can help students internalize essential money and job skills early on.
We all can share our personal experiences and expertise.
Posted by Alan Chokov - Students are heading back to school after the holidays, eager to pursue good grades, activities that will boost their resumes and that elusive summer job. Now is the time for parents to reflect upon their own contributions to family and community. Even when it seems like we all have less time, this spring may be a good time to assess opportunities to volunteer.
According to the U.S. Department of Labor, 26.4 percent of Americans volunteered in 2008. While that shows a significant number of people making an effort to give back, it also reveals that three quarters of our citizens are not volunteering.
What better way to help shape our nation's future than by personally investing in our children's education?
As students focus on their studies, there are a few subjects that most of them won't be taught: How to manage money; how to create a budget and balance a checkbook; how to avoid credit debt; how to get ready for a job in the real world.
The basics of money management what we call financial literacy are essential life skills. Few would disagree that better financial decision-making could have lessened the negative consequences of the current recession for many families.
Managing money needs to be taught early, before students head off to college or enter the workforce. Ten percent of 2008 college graduates left school owing $40,000 in educational loans, according to U.S. News & World Report. Credit card debt also is increasing. A 2009 Sallie Mae study reports students graduated with 41 percent more credit card debt than four years ago, with one in five owing at least $7,000 and 82 percent unable to pay the monthly balance in full.
More bad news is that current graduates face the toughest job market in years. A recent National Association of Colleges and Employers survey found that only 20 percent of 2009 graduates who applied for jobs have been hired.
Parents should consider volunteering to teach a financial literacy program that can help students internalize essential money and job skills early on.
We all can share our personal experiences and expertise.
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