Most people find dealing with personal finances a chore. People are loath to manage their finances for all sorts of reasons, including not being comfortable with math, not having time, or even being fearful of finding out that there's just not enough money in the bank to cover the bills.
Being willfully ignorant about your finances is not a smart strategy whether you are flush with cash or not. Having a clear understanding of your finances is a crucial first step in maintaining or improving your financial health and avoiding unnecessary stress. Remember that financial knowledge yields financial power.
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April 27, 2009
Financial Management
To improve your personal financial management skills, you must learn what is involved. The different aspects to financial management include:
* budgeting
* banking and saving
* paying taxes
* investing
* managing debt
* retirement planning, and
* estate planning.
You don’t have to learn everything at once or become an expert. Start with an overview of the basics, and continue to educate yourself over time. The following list will get you started.
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* budgeting
* banking and saving
* paying taxes
* investing
* managing debt
* retirement planning, and
* estate planning.
You don’t have to learn everything at once or become an expert. Start with an overview of the basics, and continue to educate yourself over time. The following list will get you started.
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April 25, 2009
Money and Credit
The Theory of Money and Credit
Money and Credit is an economics book written by Ludwig von Mises, originally published in German as Theorie des Geldes und der Umlaufsmittel in 1912. Along with Carl Menger's Principles of Economics, and Eugen von Böhm-Bawerk's Capital and Interest, this work was a major contribution to economic theory.
Its first English translation was published in 1934, and Part Four was added by Mises to the English language edition in 1953. In this work, Mises looks at the nature and value of money, and its effect on determining monetary policy. Included is his regression theorem, that tries to explain why money is demanded in its own right, as moneys at first glance do not serve a consumable need. Mises explained that moneys only can come about after there has been a demand for the money commodity in a barter economy.read the story....
Man, Economy, and State:
A Treatise on Economic Principles, first published in 1962, is a book on economics by Murray Rothbard, and is one of the most important books in the Austrian School of economics (others are Ludwig von Mises' The Theory of Money and Credit and Human Action). Economist Walter Block has described this volume as "excruciatingly brilliant.
" Wendy McElroy credits the book as being "solely responsible for turning [her] from the advocacy of limited government to a lifetime of work within the individualist-anarchist tradition."
When originally published in 1962, the final eight chapters were removed for political reasons; these were finally published as Power and Market in 1970. The 2004 edition published by the Ludwig von Mises Institute combines both books in a single volume. This book provides a discussion of both microeconomics and macroeconomics.
To calculate the prices of everything from airfare to books to hotel prices into their home currency, aiding your decision-making.
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Money and Credit is an economics book written by Ludwig von Mises, originally published in German as Theorie des Geldes und der Umlaufsmittel in 1912. Along with Carl Menger's Principles of Economics, and Eugen von Böhm-Bawerk's Capital and Interest, this work was a major contribution to economic theory.
Its first English translation was published in 1934, and Part Four was added by Mises to the English language edition in 1953. In this work, Mises looks at the nature and value of money, and its effect on determining monetary policy. Included is his regression theorem, that tries to explain why money is demanded in its own right, as moneys at first glance do not serve a consumable need. Mises explained that moneys only can come about after there has been a demand for the money commodity in a barter economy.read the story....
Man, Economy, and State:
A Treatise on Economic Principles, first published in 1962, is a book on economics by Murray Rothbard, and is one of the most important books in the Austrian School of economics (others are Ludwig von Mises' The Theory of Money and Credit and Human Action). Economist Walter Block has described this volume as "excruciatingly brilliant." Wendy McElroy credits the book as being "solely responsible for turning [her] from the advocacy of limited government to a lifetime of work within the individualist-anarchist tradition."
When originally published in 1962, the final eight chapters were removed for political reasons; these were finally published as Power and Market in 1970. The 2004 edition published by the Ludwig von Mises Institute combines both books in a single volume. This book provides a discussion of both microeconomics and macroeconomics.
To calculate the prices of everything from airfare to books to hotel prices into their home currency, aiding your decision-making.
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Make your Realistic Budgeting
A realistic budget is your best weapon against overspending.
If you want to keep your spending under control, it's essential that you make a budget. A budget allows you to get a handle on the flow of your money -- how much you make and how much you spend. With that information in hand, you can make intelligent choices about what to buy with your hard-earned cash.
Make a List of Your Expenses
The first step in making a realistic budget is figuring out where your money goes. To keep track, make an expense record.
Limitations of computer programs.
Unfortunately, most computer programs that track expenses only analyze your check or credit card payments -- they don't record your cash outlays.
Make your own expense record.
Rather than relying on a computer program, keep track of your expenses in a low-tech but comprehensive way: with some paper and a pen. Here's how:
1. Use one sheet of paper per week to record your expenses for two months. By doing this, you'll avoid creating a budget based on a week or a month of unusually high or low expenses.
2. Begin recording your expenses on the first day of a month.
3. Create seven columns on the page, one for each day of the week. Record the date at the top of each column.
4. Carry that sheet with you at all times.
5. Record every expense you pay by cash or cash equivalent -- check, ATM or debit card, or automatic bank withdrawal. When you make a payment on a credit card bill, list the items paid for.
6. At the end of the week, put away the sheet and take out another. Go back to Step 3.
7. At the end of the two months, list seasonal, annual, semi-annual, or quarterly expenses you incur but did not pay during your two-month recording period. The most common are property taxes, car registration and maintenance, magazine subscriptions, tax preparation fees, insurance payments, and seasonal expenses such as summer camp fees or holiday gifts.
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If you want to keep your spending under control, it's essential that you make a budget. A budget allows you to get a handle on the flow of your money -- how much you make and how much you spend. With that information in hand, you can make intelligent choices about what to buy with your hard-earned cash.
Make a List of Your Expenses
The first step in making a realistic budget is figuring out where your money goes. To keep track, make an expense record.
Limitations of computer programs.
Unfortunately, most computer programs that track expenses only analyze your check or credit card payments -- they don't record your cash outlays.
Make your own expense record.
Rather than relying on a computer program, keep track of your expenses in a low-tech but comprehensive way: with some paper and a pen. Here's how:
1. Use one sheet of paper per week to record your expenses for two months. By doing this, you'll avoid creating a budget based on a week or a month of unusually high or low expenses.
2. Begin recording your expenses on the first day of a month.
3. Create seven columns on the page, one for each day of the week. Record the date at the top of each column.
4. Carry that sheet with you at all times.
5. Record every expense you pay by cash or cash equivalent -- check, ATM or debit card, or automatic bank withdrawal. When you make a payment on a credit card bill, list the items paid for.
6. At the end of the week, put away the sheet and take out another. Go back to Step 3.
7. At the end of the two months, list seasonal, annual, semi-annual, or quarterly expenses you incur but did not pay during your two-month recording period. The most common are property taxes, car registration and maintenance, magazine subscriptions, tax preparation fees, insurance payments, and seasonal expenses such as summer camp fees or holiday gifts.
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Demand to see your credit score
Experian's refusal to let consumers see their FICO scores, even for a price, hands more power to lenders. Lawmakers might end this outrage -- if we give them a push.
By Liz Pulliam Weston
MSN Money
After years of inaction and neglect, Washington is finally getting serious about protecting people from abusive credit card practices. Consider:
President Barack Obama last week summoned credit card executives to the White House and signaled that credit card reform is on his agenda.
Meanwhile, the "Credit Cardholders' Bill of Rights" is heading for another vote in the House of Representatives.
Regulators already have imposed significant new restrictions on card issuers, although those won't go into effect until mid-2010.
Reforms are long overdue. But all sides are missing a golden opportunity to protect people from abusive credit bureau practices, specifically the bureaus' ability to cut off our access to our own FICO credit scores.
In February, I wrote about how Experian suddenly had decided not to sell FICO scores to consumers anymore, although it continues to sell the scores to lenders. That decision, which has yet to be challenged by regulators or lawmakers, conceals from consumers a vital piece of their credit information.
Crackdown on the credit card industry
You no longer have any idea, before you apply for a mortgage, what kind of interest rate to expect. That's because most mortgage lenders use the middle of your three credit bureau FICO scores to determine rates and terms. Without access to all three FICOs, you can't know what your middle score might be.
You're also at a disadvantage if you are dealing with a lender that subscribes to only one bureau and you live in the western half of the U.S. Lenders that use just one bureau tend to use the one that specializes in their region: for Experian, it's the West and Midwest; Equifax dominates the South and TransUnion the Northeast.
And it's simply unfair that information gathered specifically about you and used for profit is unavailable to you, yet can affect so many corners of your life.
By Liz Pulliam Weston
MSN Money
After years of inaction and neglect, Washington is finally getting serious about protecting people from abusive credit card practices. Consider:
President Barack Obama last week summoned credit card executives to the White House and signaled that credit card reform is on his agenda.
Meanwhile, the "Credit Cardholders' Bill of Rights" is heading for another vote in the House of Representatives.
Regulators already have imposed significant new restrictions on card issuers, although those won't go into effect until mid-2010.
Reforms are long overdue. But all sides are missing a golden opportunity to protect people from abusive credit bureau practices, specifically the bureaus' ability to cut off our access to our own FICO credit scores.
In February, I wrote about how Experian suddenly had decided not to sell FICO scores to consumers anymore, although it continues to sell the scores to lenders. That decision, which has yet to be challenged by regulators or lawmakers, conceals from consumers a vital piece of their credit information.
Crackdown on the credit card industry
You no longer have any idea, before you apply for a mortgage, what kind of interest rate to expect. That's because most mortgage lenders use the middle of your three credit bureau FICO scores to determine rates and terms. Without access to all three FICOs, you can't know what your middle score might be.
You're also at a disadvantage if you are dealing with a lender that subscribes to only one bureau and you live in the western half of the U.S. Lenders that use just one bureau tend to use the one that specializes in their region: for Experian, it's the West and Midwest; Equifax dominates the South and TransUnion the Northeast.
And it's simply unfair that information gathered specifically about you and used for profit is unavailable to you, yet can affect so many corners of your life.
Dow off 51 as swine-flu fears hit stocks
By Charley Blaine and Elizabeth Strott
MSN
Investors dump airline and cruise stocks, worrying that travelers will skip trips to Mexico and the United States. GM will cut 21,000 jobs and slash 40% of dealerships; bondholders are unhappy. Bank stocks drop ahead of stress test results.
Stocks finished lower today because of the swine flu outbreak in Mexico and United States. But the damage was not nearly as bad as feared.
Hotel and airline stocks and the shares of pork producers were hit hard by the news, and financial stocks dropped on economic fears and worries about how much new capital the companies may need.
But as futures trading overnight had suggested, the day could have been much, much worse.
The Dow Jones industrials ($INDU) ended down 51 points, or 0.6%, to 8,025.
The Standard & Poor's 500 Index ($INX) fell 9 points, or 1%, to 856.
The Nasdaq Composite Index ($COMPX) slipped 15 points, or 0.9%, to 1,679.
The Nasdaq-100 Index ($NDX.X), which tracks the largest Nasdaq stocks, slipped 3 points, or 0.2%, to 1,370.
The selling continued a pattern in force since the market rally began on March 10: Stocks have fallen in six of the last seven Mondays and have moved higher at the end of each week.
The market found support near two key levels: The Dow dropped below 8,000 at 1:50 p.m. and quickly rebounded. The S&P 500 finished fairly close to 860. The Dow
While the swine flu outbreak hit travel and a number of food stocks, it boosted shares of the makers of drugs that can help prevent catching the disease.
The worries spread to energy stocks, pushing the price of crude oil lower, and added to the worries about how long the recession will last.
The downturn came despite a 20.7% gain -- to $2.06 -- in shares of General Motors (GM, news, msgs), which announced a new restructuring plan. GM's gain was the largest among the 30 Dow stocks.
Meanwhile, financial stocks were lower on worries about whether the government's stress test will force several large regional banks to raise new capital.
Regions Financial (RF, news, msgs) was down 11.7% to $4.91; KeyCorp (KEY, news, msgs) fell 12% to $6.16.
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MSN
Investors dump airline and cruise stocks, worrying that travelers will skip trips to Mexico and the United States. GM will cut 21,000 jobs and slash 40% of dealerships; bondholders are unhappy. Bank stocks drop ahead of stress test results.
Stocks finished lower today because of the swine flu outbreak in Mexico and United States. But the damage was not nearly as bad as feared.
Hotel and airline stocks and the shares of pork producers were hit hard by the news, and financial stocks dropped on economic fears and worries about how much new capital the companies may need.
But as futures trading overnight had suggested, the day could have been much, much worse.
The Dow Jones industrials ($INDU) ended down 51 points, or 0.6%, to 8,025.
The Standard & Poor's 500 Index ($INX) fell 9 points, or 1%, to 856.
The Nasdaq Composite Index ($COMPX) slipped 15 points, or 0.9%, to 1,679.
The Nasdaq-100 Index ($NDX.X), which tracks the largest Nasdaq stocks, slipped 3 points, or 0.2%, to 1,370.
The selling continued a pattern in force since the market rally began on March 10: Stocks have fallen in six of the last seven Mondays and have moved higher at the end of each week.
The market found support near two key levels: The Dow dropped below 8,000 at 1:50 p.m. and quickly rebounded. The S&P 500 finished fairly close to 860. The Dow
While the swine flu outbreak hit travel and a number of food stocks, it boosted shares of the makers of drugs that can help prevent catching the disease.
The worries spread to energy stocks, pushing the price of crude oil lower, and added to the worries about how long the recession will last.
The downturn came despite a 20.7% gain -- to $2.06 -- in shares of General Motors (GM, news, msgs), which announced a new restructuring plan. GM's gain was the largest among the 30 Dow stocks.
Meanwhile, financial stocks were lower on worries about whether the government's stress test will force several large regional banks to raise new capital.
Regions Financial (RF, news, msgs) was down 11.7% to $4.91; KeyCorp (KEY, news, msgs) fell 12% to $6.16.
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Financial Changes
Consider larger financial changes.
If you continually come up short, you may need to consider some larger changes. For example, you might sell your newer car for an older used car to free yourself from car payments. As you make adjustments to your budget, give careful thought to your priorities. Think about what you value, and be honest with yourself.
If you continually come up short, you may need to consider some larger changes. For example, you might sell your newer car for an older used car to free yourself from car payments. As you make adjustments to your budget, give careful thought to your priorities. Think about what you value, and be honest with yourself.
Make Adjustments
Review your budget and make adjustments.
Check your figures periodically. If you never have enough money to make ends meet, it's time to adjust some more. Or, if you constantly overspend in one area, change the projected amount for that category and trim the money from another category.
Check your figures periodically. If you never have enough money to make ends meet, it's time to adjust some more. Or, if you constantly overspend in one area, change the projected amount for that category and trim the money from another category.
Make a List
Preserve things you cannot live without.
Make a list of things you feel you can't live without, and whittle down your other expenses to accommodate them. For example, you may decide to give up most of your magazine and newspaper subscriptions because you know you'd go nuts if you couldn't go to the movies once a week. If you make room for at least some of the things you love most, you're much more likely to succeed at your plan.
Make a list of things you feel you can't live without, and whittle down your other expenses to accommodate them. For example, you may decide to give up most of your magazine and newspaper subscriptions because you know you'd go nuts if you couldn't go to the movies once a week. If you make room for at least some of the things you love most, you're much more likely to succeed at your plan.
April 22, 2009
Expenses
Decreasing Expenses
If your expenses exceed your income, you will have to cut expenses or increase your income. If finding more income is not realistic, focus on decreasing your expenses. The trick is doing this without depriving yourself of items or services you truly need.
If your expenses exceed your income, you will have to cut expenses or increase your income. If finding more income is not realistic, focus on decreasing your expenses. The trick is doing this without depriving yourself of items or services you truly need.
How to create budget
How to create your budget.
1. Determine the categories into which your expenses fall (see the chart below for suggested categories.) List your categories of expenses down the left side of a piece of paper (or Excel spreadsheet). Use as many sheets as you need to list all categories. These are your budget sheets.
2. On the sheets containing your list of categories, make 13 columns. Label the first one "projected" and the remaining 12 with the months of the year. Unless today is the first of the month, start with next month.
3. Using your total actual expenses for the two months you tracked and the other expenses you added, project your monthly expenses for the categories you've listed. (Make a note of when smaller expenses, such as magazine subscriptions, are due so you can adjust your budget for that month. These temporary adjustments make more sense than trying to save $1.23 each month to cover an annual magazine subscription.
4. Enter your projected monthly expenses into the "projected" column of your budget sheets.
5. Add up all projected monthly expenses and enter the total into a "Total Expenses" category at the bottom of the projected column.
6. Enter your projected monthly income below your total projected expenses.
7. Figure out the difference.
1. Determine the categories into which your expenses fall (see the chart below for suggested categories.) List your categories of expenses down the left side of a piece of paper (or Excel spreadsheet). Use as many sheets as you need to list all categories. These are your budget sheets.
2. On the sheets containing your list of categories, make 13 columns. Label the first one "projected" and the remaining 12 with the months of the year. Unless today is the first of the month, start with next month.
3. Using your total actual expenses for the two months you tracked and the other expenses you added, project your monthly expenses for the categories you've listed. (Make a note of when smaller expenses, such as magazine subscriptions, are due so you can adjust your budget for that month. These temporary adjustments make more sense than trying to save $1.23 each month to cover an annual magazine subscription.
4. Enter your projected monthly expenses into the "projected" column of your budget sheets.
5. Add up all projected monthly expenses and enter the total into a "Total Expenses" category at the bottom of the projected column.
6. Enter your projected monthly income below your total projected expenses.
7. Figure out the difference.
Monthly Income
Determine monthly income.
Finally, multiply the net amount by the number of pay periods to determine the monthly amount. For example, if you are paid twice a month, multiply the net amount by two. If you are paid every other week, multiply the amount by 26 (for the annual amount) and divide by 12.
When you are done, total up all the amounts. This is your total average monthly income.
After you keep track of your expenses and income for a few months, you're ready to create a budget. Your goals in making a budget are to:
* control your impulses to overspend, and
* start saving money.
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Finally, multiply the net amount by the number of pay periods to determine the monthly amount. For example, if you are paid twice a month, multiply the net amount by two. If you are paid every other week, multiply the amount by 26 (for the annual amount) and divide by 12.
When you are done, total up all the amounts. This is your total average monthly income.
After you keep track of your expenses and income for a few months, you're ready to create a budget. Your goals in making a budget are to:
* control your impulses to overspend, and
* start saving money.
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Net Income
Record net income.
Next to each source of income, list the net (after deductions) amount you receive each pay period. If you don't receive the same amount each period, average the last 12.
Next to each net amount, enter the period covered by the payment -- such as weekly, twice monthly (24 times a year), every other week (26 times a year), monthly, quarterly, or annually.
Next to each source of income, list the net (after deductions) amount you receive each pay period. If you don't receive the same amount each period, average the last 12.
Next to each net amount, enter the period covered by the payment -- such as weekly, twice monthly (24 times a year), every other week (26 times a year), monthly, quarterly, or annually.
Income
Total Your Income
Your expenditures account for only half of the picture. You also need to add up your monthly income.
On a blank sheet of paper, list the jobs for which you receive a salary or wages. Then, list all self-employment for which you receive income, including farm income and sales commissions. Finally, list other sources of income, such as:
* bonus pay
* dividends and interest
* alimony or child support
* pension or retirement income, and
* public assistance.
Your expenditures account for only half of the picture. You also need to add up your monthly income.
On a blank sheet of paper, list the jobs for which you receive a salary or wages. Then, list all self-employment for which you receive income, including farm income and sales commissions. Finally, list other sources of income, such as:
* bonus pay
* dividends and interest
* alimony or child support
* pension or retirement income, and
* public assistance.
Best of way to do when making your Budget
Staying on track
Don't think of your budget as etched in stone. If you do, and you spend more on an item than you've budgeted, you'll get frustrated and be more likely to scrap the budget altogether.
Be willing to sacrifice.
You may have to sacrifice some things that feel important to you. But don't expect to stick to your budget if you take away all but the essentials. Be realistic.
Don't think of your budget as etched in stone. If you do, and you spend more on an item than you've budgeted, you'll get frustrated and be more likely to scrap the budget altogether.
Be willing to sacrifice.
You may have to sacrifice some things that feel important to you. But don't expect to stick to your budget if you take away all but the essentials. Be realistic.
Budgeting
Drafting a personal budget is one of the best ways to control your spending. Until you know what you earn and spend, you can't figure out how to live within your means. Don’t be intimidated by the process. Creating a budget can be simple and easy. For information on budgeting,
April 21, 2009
JCB Creditcard
Japan Credit Bureau, usually abbreviated as JCB, is a credit card company based in Tokyo, Japan. Its English name is JCB Co., Ltd. (株式会社ジェーシービー ,Kabushiki gaisha jē shī bī?). The abbreviation is sometimes thought to stand for Japan Commerce Bank, but this is incorrect.
Founded in 1961, JCB established dominance over the Japanese credit card market when it purchased Osaka Credit Bureau in 1968 and its cards are now issued in 20 different countries. Fifty-nine million JCB cardmembers worldwide use their cards to purchase over US$62.7 billion of goods and services annually in 190 countries worldwide.
JCB also operates a network of membership lounges targeting Japanese, Chinese, and Korean travelers in Europe, Asia, and North America.
Since 1981, JCB has been aggressively expanding its business overseas. Currently JCB cards are issued in 20 countries, most of which JCB is affiliated with financial institutions to license them to issue JCB-branded cards. All the international operation is conducted through its 100% subsidiary, JCB International Credit Card Co., Ltd.
In the United States, JCB is not as well known or as widely accepted as other credit cards such as Visa, MasterCard or American Express. Instead it is primarily accepted by tourism-related businesses such as airlines, car rental companies, and hotels. JCB is also increasingly accepted at businesses such as department stores, gas stations, and Japanese specialty retailers.
JCB accounts in the United States are issued by JCBUSA, but are currently only available to residents of California, Connecticut, Illinois, Nevada, New York, New Jersey, Oregon, Washington and Hawaii
Founded in 1961, JCB established dominance over the Japanese credit card market when it purchased Osaka Credit Bureau in 1968 and its cards are now issued in 20 different countries. Fifty-nine million JCB cardmembers worldwide use their cards to purchase over US$62.7 billion of goods and services annually in 190 countries worldwide.
JCB also operates a network of membership lounges targeting Japanese, Chinese, and Korean travelers in Europe, Asia, and North America.
Since 1981, JCB has been aggressively expanding its business overseas. Currently JCB cards are issued in 20 countries, most of which JCB is affiliated with financial institutions to license them to issue JCB-branded cards. All the international operation is conducted through its 100% subsidiary, JCB International Credit Card Co., Ltd.
In the United States, JCB is not as well known or as widely accepted as other credit cards such as Visa, MasterCard or American Express. Instead it is primarily accepted by tourism-related businesses such as airlines, car rental companies, and hotels. JCB is also increasingly accepted at businesses such as department stores, gas stations, and Japanese specialty retailers.
JCB accounts in the United States are issued by JCBUSA, but are currently only available to residents of California, Connecticut, Illinois, Nevada, New York, New Jersey, Oregon, Washington and Hawaii
Discover Card
The Discover Card is a major credit card, issued primarily in the United States. It was originally introduced by Sears in 1985, and was part of Dean Witter, and then Morgan Stanley, until 2007, when Discover Financial Services became an independent company. Novus, a major processing center, used to be partners with the company as well. The Novus logo has since been retired and now the Discover Network logo has replaced it.
Most cards with the Discover brand are issued by Discover Bank. Discover Card transactions are processed through the Discover Network payment network. As of February 2006, the company announced that it would begin offering Discover Debit cards to banks, made possible by the Pulse payment system, which Discover acquired in 2005.
At the time the Discover Card was introduced, Sears was the largest retailer in the United States. It had purchased the Dean Witter Reynolds Organization (brokerage) and Coldwell, Banker & Company (real estate) in 1981, as an attempt to add financial services to its portfolio of customer services.
Together with the Discover Card (and its issuing bank, the Greenwood Trust Company, owned by Sears), this was named the Sears Financial Network. Early Discover Cards bore a small embossed symbol representing the Sears Tower, the company's headquarters at the time.
In October 2004, the Supreme Court upheld a ruling in Discover Card's favor that challenged exclusionary policies of Visa and MasterCard. Before this ruling, Visa and MasterCard would not allow banks to issue a Discover Card if they issued a Visa or MasterCard. Within days of the court ruling, Discover Card filed a lawsuit in federal court seeking damages from Visa and MasterCard. In 2005, Discover Card acquired PULSE, an electronic funds transfer association, allowing it to issue and market debit and ATM cards.
Shortly after the 2004 Supreme Court ruling, Discover also struck its first deal to have its card issued by another bank, GE Consumer Finance, which now issues three cards for retailer Wal-Mart and its wholesale warehouse stores, Sam's Club; transactions for both cards are processed on the Discover Network. Sam's Club exclusively accepted Discover Card for many years, although, since November 2006, it has also accepted MasterCard for purchases.
HSBC has also issued credit cards processed through the Discover Network, and branded with the Discover logo, since its acquisition of card issuer Metris in late 2005. Metris had originally signed an agreement with Discover in September 2005, only three months prior to the HSBC acquisition.
Morgan Stanley was long thought to want to sell the Discover Card business, and in April 2005, it announced that it would divest Discover Financial Services as an independent company within six months. However, by June industry sources reported that Morgan Stanley was reassessing its plan to spin off Discover.
Finally, in August 2005, the company confirmed it would not sell Discover. In yet another reversal, in December 2006, Morgan Stanley announced it would, again, spin off Discover as a standalone company by the end of August 2007. The spin-off was finalized ahead of schedule, on June 30, 2007.
Most cards with the Discover brand are issued by Discover Bank. Discover Card transactions are processed through the Discover Network payment network. As of February 2006, the company announced that it would begin offering Discover Debit cards to banks, made possible by the Pulse payment system, which Discover acquired in 2005.
At the time the Discover Card was introduced, Sears was the largest retailer in the United States. It had purchased the Dean Witter Reynolds Organization (brokerage) and Coldwell, Banker & Company (real estate) in 1981, as an attempt to add financial services to its portfolio of customer services.
Together with the Discover Card (and its issuing bank, the Greenwood Trust Company, owned by Sears), this was named the Sears Financial Network. Early Discover Cards bore a small embossed symbol representing the Sears Tower, the company's headquarters at the time.
In October 2004, the Supreme Court upheld a ruling in Discover Card's favor that challenged exclusionary policies of Visa and MasterCard. Before this ruling, Visa and MasterCard would not allow banks to issue a Discover Card if they issued a Visa or MasterCard. Within days of the court ruling, Discover Card filed a lawsuit in federal court seeking damages from Visa and MasterCard. In 2005, Discover Card acquired PULSE, an electronic funds transfer association, allowing it to issue and market debit and ATM cards.
Shortly after the 2004 Supreme Court ruling, Discover also struck its first deal to have its card issued by another bank, GE Consumer Finance, which now issues three cards for retailer Wal-Mart and its wholesale warehouse stores, Sam's Club; transactions for both cards are processed on the Discover Network. Sam's Club exclusively accepted Discover Card for many years, although, since November 2006, it has also accepted MasterCard for purchases.
HSBC has also issued credit cards processed through the Discover Network, and branded with the Discover logo, since its acquisition of card issuer Metris in late 2005. Metris had originally signed an agreement with Discover in September 2005, only three months prior to the HSBC acquisition.
Morgan Stanley was long thought to want to sell the Discover Card business, and in April 2005, it announced that it would divest Discover Financial Services as an independent company within six months. However, by June industry sources reported that Morgan Stanley was reassessing its plan to spin off Discover.
Finally, in August 2005, the company confirmed it would not sell Discover. In yet another reversal, in December 2006, Morgan Stanley announced it would, again, spin off Discover as a standalone company by the end of August 2007. The spin-off was finalized ahead of schedule, on June 30, 2007.
April 19, 2009
Credit repair and debt
Except for those folks who are born accountants, most people find dealing with personal finances a chore. People are loath to manage their finances for all sorts of reasons, including not being comfortable with math, not having time, or even being fearful of finding out that there’s just not enough money in the bank to cover the bills. But you must have a clear understanding of your finances to maintain or improve your financial health.
Credit Insurance
Insurance a lender requires a borrower to purchase to cover the loan. If the borrower dies or becomes disabled before paying off the loan, the policy will pay off the remaining balance. Federal and state consumer protection laws require the lender to disclose to existing and potential borrowers the terms and costs of obtaining credit insurance because it can affect the terms of the loan.
April 12, 2009
Credit counseling
Counseling that explores the possibility of repaying debts outside of bankruptcy and educates the debtor about credit, budgeting, and financial management.
Under the new bankruptcy law, a debtor must undergo credit counseling with an approved provider before filing for bankruptcy.
Under the new bankruptcy law, a debtor must undergo credit counseling with an approved provider before filing for bankruptcy.
April 05, 2009
VISA ElectronCard
Visa Electron is a debit or credit card available across most of the world, with the exception of Canada, Australia, and the United States. The card was introduced by VISA in the 1980s and is a sister card to the Visa Debit card.
The difference between Visa Electron and Visa Debit is that payments with Visa Electron require that all the funds be available at the time of the transfer (i.e., Visa Electron card accounts cannot be overdrawn).
As a comparison, Visa Debit cards allow transfers of unavailable funds below a certain limit. As a result, some online stores and all offline terminals (e.g., onboard trains or planes) do not support Visa Electron because their systems cannot check for the availability of funds.
In different regions, the card is issued with different specifications. For example, one bank may issue it as a debit card, while another may issue it as a credit card. It is most commonly issued as a debit card. In this case applying for a credit card requires the applicant to present some proof of regular income (such as an employment certificate) or financial assets invested elsewhere.
In addition to debit facilities, the card also allows the holder to withdraw cash from ATMs even outside the holder's country of residence unlike normal ATM cards issued in some countries. This is because Visa Electron cards are also linked to the PLUS interbank network. While one may not be able to purchase the card in the United States, it can be used to transfer funds from other countries, for example Lebanon.
In the United Kingdom, the card is not as widely accepted as the brother Visa Debit card, but is often issued by banks as a debit card for children's accounts. In some countries, like Australia, retailers are required to accept the card as part of VISA's Accept All Cards Policy, which also applies to the normal Visa Debit card, although the card is not available locally.[citation needed]
In countries that have stricter criteria for issuing credit cards, Visa Electron has become popular with younger people and students alike. As each transaction requires funds to be checked, there is no chance of accounts going overdrawn. Therefore banks will issue a Visa Electron card to customers who may not qualify for another type of card.
As Visa Electron cards lack embossed details, they cannot be used with older card "imprinters" that transfer payment information to a paper slip, unless the card details are manually entered.
As the card carries a low interchange fee, airlines and other businesses which apply a surcharge for credit and debit card payments generally do not apply one for Visa Electron payments.
The difference between Visa Electron and Visa Debit is that payments with Visa Electron require that all the funds be available at the time of the transfer (i.e., Visa Electron card accounts cannot be overdrawn).
As a comparison, Visa Debit cards allow transfers of unavailable funds below a certain limit. As a result, some online stores and all offline terminals (e.g., onboard trains or planes) do not support Visa Electron because their systems cannot check for the availability of funds.
In different regions, the card is issued with different specifications. For example, one bank may issue it as a debit card, while another may issue it as a credit card. It is most commonly issued as a debit card. In this case applying for a credit card requires the applicant to present some proof of regular income (such as an employment certificate) or financial assets invested elsewhere.
In addition to debit facilities, the card also allows the holder to withdraw cash from ATMs even outside the holder's country of residence unlike normal ATM cards issued in some countries. This is because Visa Electron cards are also linked to the PLUS interbank network. While one may not be able to purchase the card in the United States, it can be used to transfer funds from other countries, for example Lebanon.
In the United Kingdom, the card is not as widely accepted as the brother Visa Debit card, but is often issued by banks as a debit card for children's accounts. In some countries, like Australia, retailers are required to accept the card as part of VISA's Accept All Cards Policy, which also applies to the normal Visa Debit card, although the card is not available locally.[citation needed]
In countries that have stricter criteria for issuing credit cards, Visa Electron has become popular with younger people and students alike. As each transaction requires funds to be checked, there is no chance of accounts going overdrawn. Therefore banks will issue a Visa Electron card to customers who may not qualify for another type of card.
As Visa Electron cards lack embossed details, they cannot be used with older card "imprinters" that transfer payment information to a paper slip, unless the card details are manually entered.
As the card carries a low interchange fee, airlines and other businesses which apply a surcharge for credit and debit card payments generally do not apply one for Visa Electron payments.
CHOICE Card
Choice was a credit card test marketed by Citibank in the United States, announced in 1977 and first issued in 1978. It was one of the first cards to offer a cash-refund program and no annual fee. Choice was intended to create a rival to Visa, MasterCard, and American Express, but proved unsuccessful, and was withdrawn in 1987. Citibank has continued to use the "Choice" name on some of its Visa and MasterCard cards.
The card was introduced in 1977, when Citibank bought NAC, a regional credit card based in Baltimore, renaming it Choice. A subsequent campaign in Maryland in 1980 turned the card into a regional success, earning more than one million cardholders in the Baltimore and Washington, DC, area.
With a view to nationwide expansion, the test market was expanded to include Colorado. Ultimately, despite the success of Sears' Discover Card, which offered many of the same features as Choice when it was introduced in 1985 (such as a rebate on purchases and no annual fee), Citibank decided Choice could not compete with Visa and MasterCard in the longer term, and the card was reissued as a Visa at the end of 1987, aimed at entry-level customers and those with poor credit.
Its fate was similar to that of Citibank's first credit card, the "First National City Charge Service" (or "The Everything Card"), introduced on the East Coast in 1967 to compete with BankAmericard (today's Visa) but which became part of Master Charge (now MasterCard) in 1969
The card was introduced in 1977, when Citibank bought NAC, a regional credit card based in Baltimore, renaming it Choice. A subsequent campaign in Maryland in 1980 turned the card into a regional success, earning more than one million cardholders in the Baltimore and Washington, DC, area.
With a view to nationwide expansion, the test market was expanded to include Colorado. Ultimately, despite the success of Sears' Discover Card, which offered many of the same features as Choice when it was introduced in 1985 (such as a rebate on purchases and no annual fee), Citibank decided Choice could not compete with Visa and MasterCard in the longer term, and the card was reissued as a Visa at the end of 1987, aimed at entry-level customers and those with poor credit.
Its fate was similar to that of Citibank's first credit card, the "First National City Charge Service" (or "The Everything Card"), introduced on the East Coast in 1967 to compete with BankAmericard (today's Visa) but which became part of Master Charge (now MasterCard) in 1969
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